HomeMy WebLinkAboutJune-30-2017
CITY OF PADUCAH,
KENTUCKY
COMPREHENSIVE
ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2017
FINANCE DEPARTMENT
CITY OF PADUCAH,
KENTUCKY
CITY OF PADUCAH, KENTUCKY
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2017
TABLE OF CONTENTS
Exhibit No. Page No.
Introductory Section:
Letter of Transmittal 1 - 7
Organizational Chart 8
Principal Officials 9
GFOA Certificate of Achievement 10
Financial Section:
Independent Auditor’s Report 11-12
Required Supplementary Information:
Management’s Discussion and Analysis 13-28
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position 1 29-30
Statement of Activities 2 31-32
Fund Financial Statements:
Governmental Funds:
Balance Sheet 3 33-34
Reconciliation of the Governmental Funds Balance
Sheet to Statement of Net Position 4 35-36
Statement of Revenues, Expenditures and Changes
in Fund Balances 5 37-38
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances of
Governmental Funds to the Statement of Activities 6 39-40
Statement of Revenues, Expenditures and Changes -
Budget and Actual - General Fund 7 41-44
Statement of Revenues, Expenditures and Changes -
Budget and Actual - Special Revenue Investment Fund 8 45
Proprietary Funds:
Statement of Net Position 9 46
Statement of Revenues, Expenses and Changes in
Fund Net Position 10 47
Statement of Cash Flows 11 48
Fiduciary Funds:
Statement of Net Position 12 49
Statement of Changes in Net Position 13 50
Notes to Financial Statements 51-95
Required Supplementary Information:
Schedule of Changes in the Police and Firefighters’
Pension Trust Fund’s Net Pension Liability and Related Ratios A-1 96
Schedule of Changes in the Appointive Employees’
Pension Trust Fund’s Net Pension Liability and Related Ratios A-2 97
Schedule of Police and Firefighters’ Pension Trust Fund
Contributions and Investment Returns A-3 98
Schedule of Changes in the Appointive Employees’
Pension Trust Fund Contributions and Investment Returns A-4 99
Schedule of City’s Proportionate Share of the Net Pension Liability
County Employees’ Retirement System A-5 100
Schedule of City’s Contributions
County Employees’ Retirement System A-6 101
Exhibit No. Page No.
Supplementary Information:
General Capital Improvements Detail Schedule of
Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual B-1 102
Debt Service Fund Detail Schedule of Revenues,
Expenditures, and Changes in Fund Balance - Budget
and Actual B-2 103
Nonmajor Governmental Funds:
Combining Balance Sheet B-3 104-105
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances B-4 106-107
Detail Statement of Revenues, Expenditures, and
Changes in Fund Balance - Budget and Actual:
Municipal Aid Fund B-5 108
Emergency Communication Service Fund B-6 109
Court Awards Fund B-7 110
CDBG Grant Fund B-8 111
Special Revenue Bond Fund B-9 112
Nonmajor Proprietary Funds:
Nonmajor Enterprise Funds:
Combining Statement of Net Position C-1 113
Combining Statement of Revenues, Expenses and
Changes in Fund Net Position C-2 114
Combining Statement of Cash Flows C-3 115
Internal Service Funds:
Combining Statement of Net Position D-1 116
Combining Statement of Revenues, Expenses, and
Changes in Fund Net Position D-2 117
Combining Statement of Cash Flows D-3 118
Fiduciary Funds:
Combining Statement of Net Position -
Private-purpose Trust Funds E-1 119
Combining Statement of Changes in Net Position -
Private-purpose Trust Funds E-2 120
Statement of Changes in Assets and
Liabilities - Agency Funds E-3 121
Table No. Page No.
Statistical Section:
Net Position by Component 1 122
Changes in Net Position 2 123-124
Fund Balances, Governmental Funds 3 125
Changes in Fund Balances, Governmental Funds 4 126
Assessed and Estimated Actual Value of
Taxable Property 5 127
Governments 6 128
Principal Taxpayers 7 129
Secured Tax Levies and Collections 8 130
Employee License Tax Collections 9 131
Principal Employee License Taxpayers 10 132
Ratio of Outstanding Debt by Type 11 133
Ratio of Net General Bonded Debt Outstanding 12 134
Table No. Page No.
Statistical Section:
Direct and Overlapping Governmental
Activities Debt 13 135
Legal Debt Margin Information 14 136
Demographic and Economic Statistics 15 137
Principal Employers 16 138
City Full-Time Employees by Function 17 139
Operating Indicators by Function 18 140
Capital Asset Statistics by Function 19 141
Single Audit Section:
Schedule of Expenditures of Federal Awards 142
Notes to the Schedule of Expenditures of Federal
Awards 143
Independent Auditor’s Report on Internal Control Over
Financial Reporting and on Compliance and Other Matters Based
on an Audit of Financial Statements Performed in Accordance
with Government Auditing Standards 144-145
Independent Auditor’s Report on Compliance for Each Major
Program and on Internal Control Over Compliance Required by
Uniform Guidance 146-147
Schedule of Findings and Questioned Costs 148
Schedule of Prior Audit Findings 149
December 21, 2017
Honorable Mayor and Commissioners
City of Paducah
Paducah, Kentucky
We are pleased to submit Paducah's Comprehensive Annual Financial Report for the year ended June 30,
2017. 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, 2017,
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 and cultural center. 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.
CITY OF PADUCAH
Finance Department
P.O. Box 2267
Paducah, KY 42002-2267
270-444-8512
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Economic Development Activities
Paducah Economic Development (PED) 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, PED
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, PED 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 Illinois Central). The park is
located within the southwest quadrant of the I-24/Cairo Road interchange.
In 2007, PED began assembling property to establish Riverport West, an industrial park with rail and river
access in western McCracken County. So far, 229 acres have been purchased.
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,
the McCracken County School System, Community Christian Academy, and by the 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. In 2010, a new 65,000 square feet 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 Paducah Economic Development to construct an approximately 40,000
square foot educational building to serve as their Paducah campus. Classes began at the Paducah campus
in 2014.
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 650 beds for medical needs.
The two largest hospitals, together, employ over 3,000 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, footgolf,
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 180-
year-old historic neighborhood. The LowerTown Art and Music Festival is an outdoor-juried show in its
15th 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. A second annual show began in
September 2017, which had an estimated 15,000 in attendance.
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 40,000 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 $40,000 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.
The Luther F. Carson Four Rivers Center for the Performing Arts 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.
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The McCracken County Public Library offers a large selection of literature, special collections and
programs. The West Kentucky Community and Technical College Library supplement this community
resource.
THE GOVERNMENT
Paducah operates under a City Manager plan 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 330 full-time employees as of June 30, 2017. 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 City has one component unit that has been presented as a discrete unit to emphasize that it is legally
separate from the City. Paducah Water Works is included in the City’s financial statements because of its
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; 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
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.
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Internal Control
In developing and evaluating the City’s accounting system, consideration is given to the adequacy of
internal controls. Because the cost of a control should not exceed the benefits to be derived, the objective
of these internal controls is to provide reasonable, rather than absolute assurance that the financial
statements are free of any material misstatements. 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 FY2017, one 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 FY2017
this contribution was $435 thousand. This amount was $417 thousand in FY2016.
LONG-TERM FINANCIAL PLANNING
On October 1, 2005, the City’s payroll tax was increased ½ cent. As a result of the payroll tax increase,
the City Commission created the Investment Fund. The Investment Fund is funded with the ½ cent
increase and is dedicated to the following purposes: community redevelopment, economic development,
infrastructure capital investment, and property tax relief. During the FY2017 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 and levee system protecting a large portion of the
Paducah-McCracken area exceeds 70 years of age. Its age has marginalized its electrical and mechanical
components well beyond their 50 year useful design life; therefore, it is in need of necessary repairs and
upgrades. In FY2011, the U.S. Army Corps of Engineers (USACE) issued a Feasibility Report, which
recommended a comprehensive reconstruction, rehabilitation, and restoration project to improve the
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reliability and restore the system performance of the original floodwall construction. It is anticipated the
USACE will cover 65% of the expenses incurred and the City will be responsible for the remaining 35%
by payment or credited by in-kind services. The USACE and the City are now initiating Preconstruction
Engineering and Design (PED) and preparing plans and specifications for the reconstruction projects as
listed within the Feasibility Report. This project will have multiple phases and priorities of which cannot
be completed within one project package. The City has targeted pump stations #2 and #9 to have active
construction during calendar years 2018 and 2019. Based on USACE revised authorization, it is estimated
that the City’s portion for the total overall project cost is approximately $10.9 million. The City has
aligned itself with USACE to receive future in-kind credit approximating $2.1 million it expended in
FY2009 for identified project components requiring reconstruction, i.e., slip lining 37 of its corrugated
metal pipes.
Storm Water Master Plan. In March 2017, the City Commission approved an ordinance to execute an
agreement for professional engineering, consulting, and related services for the development of a
comprehensive storm water master plan (CSMP). The CSMP will provide the City the identification of
ten priority flood areas, the analysis of flood mitigation alternatives, a prioritized raking of projects along
with a benefit cost analysis, and the development of a capital project program. The CSMP process has an
anticipated completion date by the end of 2018. Decisions made once this process is complete will
require long-term financial 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
increased slightly in comparison to the prior year, with 27,883 persons employed (McCracken County) as
of June 30, 2017. The June 2017 unemployment rate was 6.8% (McCracken County), which is a 10%
increase from 6.2% in the prior year, and exceeds the June 2017 federal unemployment rate of 4.4%.
INDEPENDENT AUDIT
Kentucky Revised Statute 91A-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
Kemper CPA Group, 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.
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, 2016. This was the twenty-sixth
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.
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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 Kemper CPA Group, 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.
Government Finanq� Officers Association
Certificate of
Achievement for Excellence
in Financial Reporting
Pres�nted to
City of Paducah
Kentucky
For its Compr�hensive Annual
Financi;;µ Report
for the Fiscal Year Ended
June 30, 2016
Executive D.irector/CEO
INDEPENDENT AUDITOR’S REPORT
Honorable Brandi Harless, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities, the
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, 2017, and the related notes to the financial statements, which
collectively comprise the City’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
accounting principles generally accepted in the United States of America; this includes the design, implementation, and
maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free
from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial
statements of the following component unit: Paducah Water Works, which is presented as a discretely presented
component unit in the statement of net position and statement of activities. These financial statements were audited by
another auditor whose report has been furnished to us, and our opinions, insofar as it relates to the amounts included for
Paducah Water Works, discretely presented component unit, is based solely on the reports of the other 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 financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on
the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
Opinions
In our opinion, 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 discretely presented component units, each
major fund, and the aggregate remaining fund information of the City of Paducah, Kentucky, as of June 30, 2017, and
the respective changes in financial position, and, where applicable, cash flows thereof and the respective budgetary
comparison for the General Fund and the Special Revenue Investment Fund for the year then ended in accordance with
accounting principles generally accepted in the United States of America.
100 South 4th Street Suite 300 Paducah, KY 42001
Phone: (270)443-4400 Fax: (270)443-0963 kempercpa.com
Other Matters
Required Supplementary Information
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 13-28 and 96-101 be presented to supplement the basic financial
statements. Such information, although not a part of the basic financial statements, is required by the Governmental
Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic
financial statements in an appropriate operational, economic, or historical context. We have applied certain limited
procedures to the required supplementary information in accordance with auditing standards generally accepted in the
United States of America, which consisted of inquiries of management about the methods of preparing the information
and comparing the information for consistency with management’s responses to our inquiries, the basic financial
statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an
opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient
evidence to express an opinion or provide any assurance.
Other Information
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 on pages 1-10; budgetary comparison
schedules, combining and individual nonmajor fund financial statements, budgetary comparison schedules for the
nonmajor funds, nonmajor enterprise financial statements, internal service and fiduciary financial statements on pages
102-121; and statistical section on pages 122-141, are presented for purposes of additional analysis and are not a
required part of the basic financial statements. The schedule of expenditures of federal awards on pages 142-143 is
presented for purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations Part 200,
Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also
not a required part of the basic financial statements.
The budgetary comparison schedules, combining and individual nonmajor fund financial statements, budgetary
comparison schedules for the nonmajor funds, nonmajor enterprise financial statements, internal service and fiduciary
financial statements and the schedule of expenditures of federal awards are the responsibility of management and were
derived from and relate directly to the underlying accounting and other records used to prepare the basic financial
statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the
United States of America. In our opinion, the budgetary comparison schedules, combining and individual nonmajor
fund, budgetary comparison for the nonmajor funds, nonmajor enterprise, internal service and fiduciary financial
statements and the schedule of expenditures of federal awards are fairly stated in all material respects in relation to the
basic financial statements as a whole.
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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 21, 2017, on our
consideration of the City of Paducah, Kentucky’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose
of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the
results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City
of Paducah, Kentucky’s internal control over financial reporting and compliance.
Certified Public Accountants and Consultants
Paducah, Kentucky
December 21, 2017
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CITY OF PADUCAH, KENTUCKY
MANAGEMENT’S DISCUSSION AND ANALYSIS
JUNE 30, 2017
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, 2017. 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 1-7) and the basic financial statements (pages 29-93) 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 $41 million at the close of the 2016-2017 fiscal year.
Total net position increased $11,725,459.
At fiscal year end, City governmental funds reported a combined ending fund balance of $29.3
million. Approximately 15% of this total amount, $4.5 million, is restricted or committed for
highways/streets and capital improvements. Assigned fund balance comprises 30% 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’s fund balance was $15.3 million and
is available for spending at the City’s discretion. Cash makes up approximately $10.5 million.
When compared to final total appropriations, the General Fund cash balance is 29%.
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: 1) 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 Position presents information on all City assets and liabilities, with the
difference between assets and liabilities reported as net position. Monitoring increases and/or
decreases in net position 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 position changed
during the fiscal year. All net position 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.
Both of the government-wide financial statements distinguish City functions that are primarily
supported by taxes and intergovernmental revenues (governmental activities) from other City
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 the Transient Boat Dock.
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Government-wide financial statements include not only the City (the primary government), but also
a legally separate Paducah Water Works (component unit) for which the City is financially
accountable. Financial information for the component unit is reported separately from the financial
information presented for the primary government itself.
The government-wide financial statements can be found on pages 29-32 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:
1) 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 nine (9) 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 five (5) 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 103-110.
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 35-36) and Exhibit 6 (pages 39-40)
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 33-40 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
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 Transient Boat Dock. Civic Center receives subsidy from the General
Fund.
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The City’s component unit enterprise is the Paducah Water Works. This component unit,
which has its own board of directors, is also an enterprise fund and is shown on pages 29-32.
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 111-113 of this report. Individual data for the
internal service funds is likewise presented in the form of combining statements on pages 114-
116 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 three (3) fiduciary funds (Appointive Employees’ Pension, Police and Firefighters’
Retirement, and Cemetery and Parks Trusts Funds) are presented in the form of combining
statements on pages 89-90 and 117-118 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 51-93 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 pension obligation to its
employees as well 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 102-119 of this report.
III. Government-Wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of the City’s financial
position. City assets exceeded liabilities by $41 million as of June 30, 2017.
For FY2017, the largest portion of the City’s net position ($55.1 million) 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 position ($2.3 million) represents resources that are subject to external restrictions on
how they may be used.
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In FY2015 the City implemented Government Accounting Standards Board (GASB) Statement No.
68, which requires that the City report and fully disclose its share of net pension liability, which is
$46.4 million as of June 30, 2017. Disclosing the City’s participation in the County Employee
Retirement System (CERS) has been the primary factor in driving the City’s unrestricted net
position to a negative $16.3 million in FY2017.
As of June 30, 2017, the City reports positive balances of total net position, both for the government
as a whole, as well as for its separate governmental and business-type activities.
City of Paducah, Kentucky
Net Position
June 30
Governmental Activities Business-Type Activities Total Primary Government
2017 2016 2017 2016 2017 2016
Current Assets $ 44,454,697 $ 40,457,159 $ 5,849,858 $ 7,328,926 $ 50,304,555 $ 47,786,085
Capital Assets 61,316,723 55,617,018 2,152,827 1,678,728 63,469,550 57,295,746
Other noncurrent assets 6,643,477 3,573,410 - - 6,643,477 3,573,410
Total Assets 112,414,897 99,647,587 8,002,685 9,007,654 120,417,582 108,655,241
Deferred Outflows of
Resources 9,544,779 9,697,728 454,939 440,338 9,999,718 10,138,066
Current Liabilities 7,145,085 10,283,408 501,801 390,146 7,646,886 10,673,554
Noncurrent liabilities 70,805,403 67,008,754 4,227,219 4,014,302 75,032,622 71,023,056
Total liabilities 77,950,488 77,292,162 4,729,020 4,404,448 82,679,508 81,696,610
Deferred Inflows of Resources 6,676,017 7,690,538 62,496 132,341 6,738,513 7,822,879
Net position:
Net Invested in Capital Assets 52,898,618 46,389,685 2,152,827 1,678,728 55,051,445 48,068,413
Restricted 2,268,705 1,296,007 - 38,247 2,268,705 1,334,254
Unrestricted (17,834,152) (23,323,077) 1,513,281 3,194,228 (16,320,871) (20,128,849)
TOTAL NET POSITION $ 37,333,171 $ 24,362,615 $ 3,666,108 $ 4,911,203 $ 40,999,279 $ 29,273,818
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The exhibit below charts the City’s total net position for the past ten years (as previously mentioned,
prior years have not been restated for implementation of GASB 68).
After several years of keeping a level net position, the City experienced significant increases in
FY2013 and FY2014. This was due to two consecutive years of heavy capital development that was
funded primarily with grant funding.
The City’s net position decreased significantly in FY2015 due to the implementation of GASB 68.
As discussed earlier in this report, the City’s participation in the County Employee Retirement
System (CERS) has led to the addition of a noncurrent liability of $42.7 million.
The upswing in the last two years has been due to capital development primarily funded by grants
and previously set-aside funds. This includes the completion of Riverfront Development Phase 1B,
the Olivet Church Road project, and Phase 1 of the Jim & Pat Brockenborough Rotary Health Park.
A. Analysis of the City’s Operations
The following table provides a summary of the City’s operations for the years ended June 30, 2017
and 2016. Governmental activities increased the City’s net position by $12,970,556 and whereas
business-type activities decreased the City’s net position by $1,245,097.
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City of Paducah, Kentucky
Changes in Net Position
June 30
Governmental Activities Business-Type Activities Total Primary Government
Revenues: 2017 2016 2017 2016 2017 2016
Program revenues:
Charges for services $ 3,080,186 $ 2,564,345 $ 4,604,117 $ 4,560,232 $ 7,684,303 $ 7,124,577
Operating grants/contributions 7,509,005 6,179,709
1,962,125
1,845,549 9,471,130 8,025,258
Capital grants/contributions 3,702,428 4,139,036 - - 3,702,428 4,139,036
General Revenues:
Property taxes 4,996,242 4,943,962 - - 4,996,242 4,943,962
Franchise taxes 235,512 162,593 - - 235,512 162,593
Telecommunications tax 677,478 656,214 - - 677,478 656,214
Insurance premium tax 4,331,956 4,170,381 - - 4,331,956 4,170,381
Vehicle tax 747,384 673,786 - - 747,384 673,786
Bank tax 242,931 242,344 - - 242,931 242,344
Gross receipts license tax 4,721,657 4,711,708 - - 4,721,657 4,711,708
Employee license tax 20,803,763 20,130,249 - - 20,803,763 20,130,249
Other taxes 665,384 656,647 - - 665,384 656,647
Intergovernmental revenue 364,718 368,318 - - 364,718 368,318
Unrestricted investment
earnings 188,097 137,224 37,644 30,302 225,741 167,526
Gain on sale of capital assets - - - - - -
Miscellaneous 51,922 189,489 374,244 85,649 426,166 275,138
Total revenues 52,318,663 49,926,005 6,978,130 6,521,732 59,296,793 56,447,737
Expenses:
General Government 8,652,987 9,777,876 - - 8,652,987 9,777,876
Public safety 20,176,070 20,503,784 - - 20,176,070 20,503,784
Public service 7,771,335 10,266,856 - - 7,771,335 10,266,856
Park & recreation 3,059,447 3,052,360 - - 3,059,447 3,052,360
Planning & development 1,077,265 911,830 - - 1,077,265 911,830
Interest on long-term debt 885,380 900,593 - - 885,380 900,593
Solid Waste - - 3,902,907 3,815,476 3,902,907 3,815,476
Section Eight Housing - - 1,952,441 1,874,074 1,952,441 1,874,074
Civic Center - - 92,471 74,457 92,471 74,457
Transient Boat Dock - - 1,031 - 1,031
Total expenses 41,622,484 45,413,299 5,948,850 5,764,007 47,571,334 51,177,306
Increase (decrease) in Net
position before transfers 10,696,179 4,512,706 1,029,280 757,725 11,725,459 5,270,431
Transfers 2,274,377 137,582 (2,274,377) (137,582) - -
Change in net position 12,970,556 4,650,288 (1,245,097) 620,143 11,725,459 5,270,431
Net position, July 1 24,362,615 19,712,327 4,911,205 4,291,062 29,273,820 24,003,389
NET POSITION, JUNE 30 $37,333,171 $ 24,362,615 $ 3,666,108 $ 4,911,205 $ 40,999,279 $ 29,273,820
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B. Governmental Activities
As with most municipalities, the City’s governmental activities are heavily subsidized by taxes, with
little or no program revenue for each function. The chart below demonstrates the importance of tax
revenue to essential functions of the City.
The graph below depicts the breakdown of revenue by source for fiscal year 2017.
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In fiscal year 2017, the City derived approximately 72% of its revenue from taxes/licenses.
Occupational licenses, which include payroll withholding tax, business licenses, and insurance
premium tax is the largest source of income to the City, totaling $30 million. This category of
revenue increased 2.9% from fiscal year 2016. Business license revenue was flat compared to
FY2016. Both insurance premium tax and payroll withholding tax had increases in excess of 3%.
None of these changes appear to be the result of one significant taxpayer’s activity, but the result of
multiple entities having modest increases/decreases. Property taxes continue to be a stable source of
revenue, comprising nearly 10% of total revenue in FY2017.
C. Business-Type Activities
The chart below shows the year’s revenues and expenses for each of the City’s business-type
activities. These activities should break-even; that is, the charges for services should be large
enough to sustain operations. The majority of business-type activities reflect these results – the
largest being the Solid Waste Fund with income before contributions and transfers of $1,124,848.
These results are consistent with prior years.
For fiscal year 2017, business-type activities as a whole had a decrease in net position of
$1,298,239. This decrease is primarily the result of the Solid Waste Fund’s contribution of $2
million in unrestricted retained earnings to the Capital Improvements Fund for the renovation of
City Hall. Also, beginning in FY2012, an annual transfer of approximately $240,000 is made from
Solid Waste to the General Fund. The Phase II Storm Water Act requires that the City make an
effort to curb solid waste from the landfill/sewer system. As a result, three full time street sweepers
and eighteen right of way maintenance employees (one day a week) have been assigned to this
program. Because these are General Fund employees, the Solid Waste Fund is making monthly
interfund transfers to the General Fund to compensate for their use.
Analysis of the remaining business-type activities is included in Section IV-B of this report.
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IV. Financial Analysis of the City’s Funds
A. Governmental Funds
The focus of the City’s governmental funds is to provide information on near-term inflows, outflows
and balances of spendable resources. Such information is useful in determining the City’s financing
requirements. Unreserved fund balance serves as a useful measure of the City’s net resources
available for spending at the end of the fiscal year.
At the end of the fiscal year, the City governmental funds reported combined ending fund balances
of $29.3 million. In FY2011, the City implemented GASB Statement No. 54, Fund Balance
Reporting and Governmental Fund Type Definitions. The redefined categories of fund balance are
described below:
Nonspendable fund balance includes amounts that are not in a spendable form or are required
to be maintained intact indefinitely. For example, at the end of the fiscal year, the City had
$525,732 of real property held in inventory for urban development.
Restricted fund balance has external limitations on use that may be imposed by creditors,
grantors, contributors, or laws and regulations. For example, at the end of the fiscal year,
the City had $605,406 of municipal aid funds, which are restricted in use for paving by the
State of Kentucky
Committed fund balance has self-imposed limitations enacted by the highest level of decision
making that requires formal action at the same level to remove the limitations. The City had
$2,387,922 in fund balance committed for capital improvements in the Investment Fund.
Assigned fund balance has limitations resulting from intended use; formal action is not
required. Approximately 30% of the City’s fund balance is assigned for various purposes,
including capital improvements, public safety, and debt service.
Unassigned fund balance is the total fund balance in the General Fund in excess of the other
fund balance categories.
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Approximately 52% of total fund balance, $15.3 million is unassigned General Fund fund balance,
which is available for spending at the government’s discretion but only up to the amount represented
by cash. At year-end there was $10.5 million available as General Fund cash; the balance is tied up
in other assets including accounts receivable and property taxes collectible. City fiscal policy
(Ordinance 2016-06-8380) requires that an amount not less than 10% of the General Fund’s
budgeted expenditures remain undesignated in the fund balance, or $3.7 million, which leaves $11.6
million as unreserved for fiscal year 2017.
As a measure of General Fund liquidity, readers may compare unassigned (formerly reported as
“unreserved”) fund balance to total General Fund expenditures. Unassigned General Fund’s fund
balance ($15.3 million) represents 42% of expenditures and transfers out ($36.9 million). This has
remained stable for the last ten years, as illustrated in the table below.
The Investment Fund had a fund balance of $2.4 million, all of which is committed for capital
projects. The Investment Fund was authorized by the City Commission in fiscal year 2005-2006 as
a special revenue fund whose use is restricted to property tax reduction, economic development,
community redevelopment and capital and infrastructure projects. The Investment Fund captures all
manner of financial activities related to revenue from the ½ cent payroll tax increase, effective
October 1, 2005. For FY2017, the increase in fund balance of $369 thousand was due to a budgeted
surplus of $100 thousand, slightly higher revenue than anticipated, and a budgeted debt service
expenditure for a bond issue that was delayed until FY2018.
Fund balance in the General Capital Improvements fund increased by approximately $2.2 million
from the prior year to $8.0 million. The increase is due to funds set aside to complete capital
projects in FY2018. Capital improvement projects for the year are discussed in Section VI-A of this
report.
B. Proprietary Funds
The City’s proprietary funds provide the same information found in the government-wide financial
statements but in more detail.
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Net position of the respective proprietary funds are:
Solid Waste $2,903,614
Section Eight Housing (5,831)
Civic Center 191,321
Transient Boat Dock 3,974
Combined total net asset change for the three funds was a decrease of $1.3 million, broken down as
follows: Solid Waste ($1.25 million decrease), Section Eight Housing ($45 thousand decrease),
Civic Center ($10 thousand decrease), and Transient Boat Dock ($4 thousand increase). The largest
proprietary fund, Solid Waste, was discussed under Business Type Activities (Section III-C).
The Transient Boat Dock Fund is a new fund in FY2017. The 340 foot transient boat dock opened
for business in the fall of 2017. This new facility allows for the mooring of several transient and
local recreational boats with full City services, including power, water, and sewer pump out. It also
has the capacity to supply gasoline and diesel for refueling vessels. FY2017 activity includes a
transfer from the General Fund for set up expenses incurred prior to its opening.
V. General Fund Budgetary Highlights
Differences between the original budget and the final budget resulted in a $1.2 million increase in
appropriations. This was largely due to a General Fund reserve transfer to the Capital Improvements
Fund for renovation of City Hall in the amount of $1,150,000.
Final appropriations (excluding operating transfers out) exceeded total expenditures by $3.47
million. A FY2017 appropriation in the amount of $2.4 million made for an 800mhz radio
controller replacement was postponed until FY2018 to allow additional time for the development of
an RFP and evaluation of proposals. Additionally, several departments experienced significant
salary slippage during the year due to unfilled positions. Police – Patrol had $283 thousand in
unused personal service funds, Public Works – Street Maintenance and Public Works – Facility
Maintenance had $178 thousand and $102 thousand, respectively. Several other departments also
experienced minor salary slippage.
Intergovernmental Expense of $329 thousand accounts for the pass-through of property taxes to the
Paducah Junior College. The College is technically not a taxing district, and the City levies this tax
on their behalf. The City does not include this account in its budgeting process.
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,
2017, is $63 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 2017, project and equipment additions totaled over $11 million, with $7.8 million
of that attributed to Construction in Progress at year-end. Some of the largest capital-type project
additions, in terms of dollars in fiscal year 2017, are shown in the following table:
Olivet Church Road Construction (Construction in Progress) $2,257,617
Riverfront Phase 1B (Construction in Progress) 4,434,184
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Jim & Pat Brockenborough Rotary Health Park (Construction in Progress) 607,792
Refuse trucks & equipment 875,767
Excavator 299,650
The City’s Construction in Progress balance at year end was in excess of $20 million. Two very
large projects that have comprised Construction in Progress for multiple years will be placed into
service in FY2018: 1) At fiscal year end the Riverfront Phase 1B project had total cumulative
expenditures of $8.2 million. 2) Olivet Church Road project had total cumulative expenditures of
nearly $6.4 million at the end of FY2017.
In the upcoming years, several street, economic development, riverfront development, and drainage
projects will continue and are estimated to cost several million dollars. Capital improvement projects
including infrastructure, City-owned facility improvements, continued neighborhood revitalization,
and street and sidewalk rehabilitation are among the projects to be addressed.
City of Paducah, Kentucky
Capital Assets
(Net of Accumulated Depreciation)
June 30
Governmental Activities Business-Type Activities Total Primary Government
2017 2016 2017 2016 2017 2016
Land $ 10,376,832 $ 10,393,332 $ 62,152 $ 62,152 $ 10,438,984 $ 10,455,484
Land improvements 9,411,107 9,749,732 - - 9,411,107 9,749,732
Construction in
progress 20,009,381 13,293,457 - - 20,009,381 13,293,457
Buildings and
improvements 5,926,065 5,830,257 254,997 271,324 6,181,062 6,101,581
Infrastructure 9,930,281 10,876,077 - - 9,930,281 10,876,077
Equipment 1,895,804 1,675,520 364,870 360,648 2,260,674 2,036,168
Furnishings and
fixtures 22,338 12,542 - - 22,338 12,542
Vehicles 3,744,915 3,786,101 1,470,808 984,604 5,215,723 4,770,705
TOTALS $ 61,316,723 $ 55,617,018 $ 2,152,827 $ 1,678,728 $ 63,469,550 $57,295,746
Additional information on City capital assets can be found in Note 3 in the notes to financial
statements on pages 68-70.
B. Long-Term Debt
At year-end, the City had $28,034,113 in outstanding bonds and notes payable, compared to
$27,281,531 at June 30, 2016 with maturities extending through 2032.
Governmental Activities
2017 2016
Kentucky League of Cities – 2003 $1,309,616 $1,500,126
Floodwall Rehabilitation – 2008 1,862,123 1,990,271
Convention Center Renovation – 2008 1,751,666 1,866,666
Refinanced Convention Center – 2010 4,515,000 4,955,000
Margaret Hank Agreement – 2011 47,934 94,851
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Refinanced Rental Building – 2011 2,230,000 2,530,000
Murray State University Agreement – 2011 2,109,088 2,224,792
Public Pool Renovations – 2013 925,000 990,000
Economic Development – 2013 2,040,000 2,185,000
Refinanced Public Projects – 2014 4,505,000 4,805,000
Refinanced Police/Firefighter Pension Fund Liability - 2014 3,660,000 4,055,000
CFSB Agreement - 2017 3,000,000 -
Net Premiums/Discounts 78,686 84,825
TOTALS $28,034,113 $27,281,531
During the year, the City had one new debt issue. In January 2017, the City entered into an
agreement with Community Financial Services Bank in the amount of $3 million on behalf of
McCracken County to finance improvements to the Julian Carroll Convention Center. Debt issues
prior to July 1, 2016 are described below:
Police/Firefighter Pension Fund Liability – Refinance. In November 2014, a $4.225 million
general obligation was issued to advance refund $3.845 of outstanding 2005 series bonds. The 2005
bonds were issued to finance the police and firefighters’ pension fund estimated pension liability.
Public Improvement Projects – Refinance. In May 2014, a $5.46 million general obligation was
issued to refund $5.545 million of outstanding 2010 series bonds. The 2010 bonds were 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 the public portion of a hotel purchase.
Economic Development. In September 2013, $2.475 million in general obligation taxable bonds
were issued to finance a portion of construction of 1) improvements to a speculative building and 2)
an approximately 30,000 square foot building (TeleTech). Each of these buildings are being utilized
for separate economic development projects.
Public Pool Renovations. In September 2013, $1.12 million in general obligation bonds were issued
to finance Noble Park’s pool renovation project.
Murray State University (MSU) Agreement. In November 2011, the City entered into a general
obligation note in the amount of $2,674,093 with McCracken County and MSU to finance the
construction of an educational facility to be occupied by Murray State University.
Rental Building – Refinance. In August 2011, a $3.91 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 a rental 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.
Margaret Hank Building Agreement. In June 2011, the City entered into an agreement in the
amount of $188,533 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.
Convention and Performing Arts Center – Refinance. In August 2010, a $7.165 million general
obligation was issued to advance refund $6.725 million of outstanding 2001 series bonds. The 2001
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.
- 26 -
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 50% of the principal amount through an Interlocal Cooperative Agreement between the
City and McCracken County.
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.
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).
The City’s legal debt limit under §158 of the Kentucky Constitution is 10% of total assessed value of
taxable property in Paducah; therefore, the debt limit is $244,792,901. The City’s latest bond rating
by Standard & Poor’s is AA-. The City has a relatively 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 2017, approximately 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 71-76.
VII. Other Potentially Significant Matters.
A. Post-employment Benefits. Over the years, the City’s contribution to the Kentucky Retirement
System (CERS) has seen a substantial rise in costs that has significantly impacted the City’s
operating budget. The table and graph below show the actual cost of the City’s contributions to
CERS for both Non-Hazardous and Hazardous employees for selected fiscal years 1997, 2007, and
2017.
CERS Employer Contributions
Non-Hazardous Hazardous
FY Rate Amount % Chg Rate Amount % Chg
1997 8.65% $445,178 18.69% $990,416
2007 13.19% $1,008,946 127% 28.21% $1,929,980 95%
2017 18.68% $1,631,570 62% 31.06% $2,776,387 44%
- 27 -
In early spring 2013, the State of Kentucky passed a pension reform bill (Senate Bill 2) to prevent
pension costs from escalating even higher. This legislation established a hybrid cash balance plan
for participants entering the plan after January 1, 2014, that provides a retirement benefit based on
an individual’s accumulated account balance. It also reset the amortization period to a new 30-year
period beginning with FY2015. Other highlights include the elimination of automatic cost of living
increases for retirees and provisions for retirement “spiking.” However, employer contribution rates
will not differ for employees beginning participation after January 1, 2014. The contribution rates
will be determined based on all CERS membership, and any excess funds contributed on new
employees will be used to pay down the system’s unfunded liability.
As of the date of this report, the Kentucky General Assembly is attempting to further reduce the
State’s pension liability. Under the current circumstances, the State is projecting that hazardous
duty contribution rates could reach 50% and non-hazardous contribution rates could reach 30% for
July 2018 if no action is taken by the General Assembly. If it is dealt with in special session or the
upcoming legislative session at the beginning of 2018, the hope is that the contribution rates will
stay the same or only rise marginally as major adjustments are made to the plan, including the
movement of new employees to a 401K style plan where contribution rates are more in line with
what private industry offers.
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). The Fund still remains in an unfunded position due to these events. The July
2017 actuary study shows that the PFPF unfunded pension liability is approximately $3.6 million as
the following chart displays.
- 28 -
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,
2017, indicates the minimum actuarially sound contribution for FY2018 will be $376,148.
VIII. Requests for Information
This financial report is designed to provide a general financial overview for those interested in the City
of Paducah government finances. Questions or requests for additional financial information may be
addressed to Jonathan Perkins, Finance Director, City of Paducah, 300 South 5th Street, Paducah, KY
42003.
Exhibit 2
FUNCTIONS/PROGRAMS Operating
Charges for Grants and
Primary Government:Expenses Services Contributions
Governmental activities:
General government 8,652,987 1,650,034 3,580,583$ 2,808$
Public safety 20,176,070 340,705 766,154 601,755
Public service 7,771,335 967,518 2,794,626 -
Parks and recreation 3,059,447 121,929 - -
Planning and development 1,077,265 - 228,647 3,097,865
Interest on long-term debt 885,380 - 138,995 -
Total governmental activities (See Note 1) 41,622,484 3,080,186 7,509,005 3,702,428
Business-type activities:
Solid Waste 3,902,907 4,567,392 58,402 -
Section Eight Housing 1,952,441 - 1,903,723 -
Civic Center 92,471 36,725 - -
Transient Boat Dock 1,031 - - -
Total business-type activities 5,948,850 4,604,117 1,962,125 -
TOTAL PRIMARY GOVERNMENT 47,571,334$ 7,684,303$ 9,471,130$ 3,702,428$
Component Unit:
Paducah Water Works Authority 9,856,634$ 10,957,435$ -$ 625,490$
TOTAL COMPONENT UNITS 9,856,634$ 10,957,435$ -$ 625,490$
General revenues:
Taxes and licenses:
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
Miscellaneous
Total general revenues
Transfers
Total general revenues and transfers
Change in net position
Net position - beginning
Net position - ending
See accompanying notes to the basic financial statements.
FOR THE YEAR ENDED JUNE 30, 2017
STATEMENT OF ACTIVITIES
Program Revenues
Capital
-31-
CITY OF PADUCAH, KENTUCKY
Grants and
Contributions
FUND FINANCIAL STATEMENTS
Exhibit 4
Total fund balance - total governmental funds 29,268,357$
Amounts reported for governmental activities in the Statement
of Net Position are different because:
163,983
6,372,500
34,589
61,316,723
261,542
(829,895)
9,283,237 8,714,884
See accompanying notes to the basic financial statements. (Continued)
Deferred refunding costs
Deferred pension related inflows
Deferred pension related outflows
-35-
Deferred refunding costs and deferred pension activity in
governmental activities are not current financial resources and,
therefore, are not reported in the governmental funds balance sheet:
Capital assets used in governmentalactivities are not current financial
resources and, therefore, are not reported in the governmentalfunds
balance sheet. This amount includescapital assets of Internal Service
Funds.
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO STATEMENT OF NET POSITION
Delinquent property taxes receivable are not reported in the
governmental funds balance sheet since they are not considered
"available" revenues.
Interest receivableon the long-termnotes receivableis not reported on
the governmentalfunds balance sheet since neither the note receivable
nor the interest is available to pay current period expenditures.
JUNE 30, 2017
The long-term notes receivable are not reported in the governmental
funds balance sheet since they are not available to pay current period
expenditures.
Exhibit 4
(Continued)
(1,894,752)$
(111,077)
$ 2,340,963
70,009,094 (72,350,057)
6,585,591$
(194,540)
(573,030) 5,818,021
NET POSITION OF GOVERNMENTAL ACTIVITIES 37,333,171$
See accompanying notes to the basic financial statements
The portion of accrued compensatedabsences not due and payable in
the current period, and therefore, not reported in the governmental
funds balance sheet.
JUNE 30, 2017
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.
business-type activities
Long-term pensions, bonds and notes of ($72,350,056) are not due
and payable in the current period and, therefore, they are not reported
in the governmentalfunds balance sheet. See Note 3 for detail. The
long-term pensions, bonds and notes are:
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO STATEMENT OF NET POSITION
-36-
Due within one year
Due after one year
Current assets
Net amount allocated to
Internal service funds are used by managementto charge the costs of
certain activities, such as insurance and fleet management, to
individual funds. The assets and liabilities of the Internal Service
Funds (net of amount allocated to business-type activities) not
included in other reconciling items are:
Current liabilities
Amounts reported for governmental activities in the Statement
of Activities are different because:
Exhibit 7
(Continued)
Variance with
Final Budget
Actual Positive
General government:Original Final Amounts (Negative)
Planning:
Administration 291,330$ 293,255$ 276,159$ 17,096$
Planning 167,925 463,260 441,448 21,812
Grants 158,780 840 - 840
Economic development 136,285 - - -
Total planning 754,320 757,355 717,607 39,748
Radio and rental property 2,570,760 2,570,760 133,003 2,437,757
Human rights 41,955 41,035 40,222 813
Information systems 679,020 678,830 560,910 117,920
Human resources/risk management 376,380 375,740 372,535 3,205
Total general government 7,539,275 7,508,955 4,848,176 2,660,779
Public safety:
Police:
Police administration 1,112,455 1,121,890 1,056,652 65,238
Patrol 6,496,705 6,433,825 6,116,193 317,632
Investigations 2,028,965 2,029,580 1,938,797 90,783
Total police 9,638,125 9,585,295 9,111,642 473,653
Fire:
Fire administration 658,225 579,575 575,548 4,027
Suppression 6,444,530 6,419,075 6,422,980 (3,905)
Prevention and inspection 1,065,100 1,043,225 1,038,102 5,123
Training 146,940 146,605 147,579 (974)
Total fire 8,314,795 8,188,480 8,184,209 4,271
Total public safety 17,952,920 17,773,775 17,295,851 477,924
Public service:
Public works:
Street maintenance 2,130,935 2,116,685 1,914,982 201,703
Street lighting 778,000 778,000 791,560 (13,560)
Facility maintenance 1,193,215 1,188,400 1,064,024 124,376
Total public works 4,102,150 4,083,085 3,770,566 312,519
See accompanying notes to the basic financial statements. (Continued)
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
CITY OF PADUCAH, KENTUCKY
Budgeted Amounts
GENERAL FUND
FOR THE YEAR ENDED JUNE 30, 2017
-43-
Exhibit 12
Private-
Pension purpose Agency
Funds Trusts Funds
Cash and cash equivalents 13,272$ 112,032$ 882,529$
Receivables:
Interest 4,070 - -
Investments at fair value
Money market funds 132,577 - -
Common stock 2,653,671 - -
Mutual funds 2,779,993 1,070,929 -
Total assets 5,583,583 1,182,961 882,529$
Voucher and accounts payable 101 - -
Payroll taxes and withholdings
payable - - 882,529$
Total liabilities 101 - 882,529$
Net position restricted for pensions 5,583,482$
Held in trust for other purposes 1,182,961$
See accompanying notes to the basic financial statements
NET POSITION
Primary Government
-49-
ASSETS
LIABILITIES
CITY OF PADUCAH, KENTUCKY
STATEMENT OF NET POSITION
FIDUCIARY FUNDS
JUNE 30, 2017
Government-wide Financial Statements
Fund Financial Statements
Fund Financial Statements
Revenues – Exchange and Non-Exchange Transactions
Unearned revenue
Allocation of Indirect Expenses
- 58 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 1 - Summary of Significant Accounting Policies:
Capital Assets
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, work of art capital assets received in a service concession arrangement
which are recorded at their acquisition 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 1, 1999, $2,500 or more after July 1,
1999, $3,000 or more after June 24, 2009 and $5,000 or more after June 30, 2016. Prior to July 1, 2002,
governmental funds’ infrastructure assets were not capitalized. These assets have been valued at estimated
historical cost.
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 10-15 Years
Buildings 30 Years
Building improvements 10-15 Years
Infrastructure 15-30 Years
Equipment 7-9 Years
Furnishings and fixtures 3-5 Years
Vehicles 5-7 Years
Fund Financial Statements
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.
Deferred Outflows/Inflows of Resources
Government-wide Statement
In addition to assets, the statement of net position will sometimes report a separate section for deferred
outflows of resources. This separate financial statement element, deferred outflows of resources,
represents the consumption of net position that applies to a future period(s) and so will not be recognized
as an outflow of resources (expense/expenditure) until then. The government has two items that qualifies
for reporting in the category. These are the deferred charge on refunding and deferred pension related
outflows reported in the statements of net position. A deferred charge on refunding results from the
difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and
amortized over the shorter of the life of the refunded or refunding debt.
The deferred pension related outflows results from pension contributions subsequent to the measurement
date of the pension plan and various changes resulting from actuarial pension measurement. The pension
contribution amount is deferred and recognized as a component of the change in pension plan liability in
the next measurement period. The various changes resulting from actuarial pension measurement are
deferred and amortized in future periods as a component of the pension expense.
(Continued)
deferred inflows of resources,
Deferred charge on refunding
Deferred pension contributions
Changes in proportion and differences
between employer contributions and
proportionate share of contributions
Differences between expected and
actual experience
Change of assumptions
Difference between projected and
actuarial earnings
Pension related deferred outflows
Changes in proportion and differences
between employer contributions and
proportionate share of contributions
Difference between projected and
actuarial earnings
Pension related deferred inflows
Deferred pension contributions
Differences between expected and
actual experience
Change of assumptions
Difference between projected and
actuarial earnings
Pension related deferred outflows
Unavailable revenues – property taxes
Changes in proportion and differences
between employer contributions and
proportionate share of contributions
Pension related deferred inflows
Fund Financial Statements
unavailable revenue,
Government-wide Statements
Fund Statements
program revenues
general revenues
- 63 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 1 - Summary of Significant Accounting Policies:
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.
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 Legal Restrictions of Use
Section Eight Housing Choice Voucher Program Subsidize Rental Costs for Low-
Income Families
FEMA - Disaster Grants Debris Removal and Disaster Recovery
HOME Investment Partnerships Grant Construction of Low-income
Rental Units
Emergency Communication Revenue E-911 Emergency Services
Transient Room Tax Debt Obligations
Homeland Security Grant Program Homeland Security Enhancement
Kentucky Housing Corporation Façade Loans
Other Grants Grant Program Expenditures
Bond Proceeds Defeasance of debt and Capital Projects
25% of Employee Earning Tax Economic, Community and
Capital Development
For the year ended June 30, 2017, 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 21, 2017, the date financial statements were available to be
issued.
(Continued)
City Policy
City Policy
Pension Trust Policy
Pension Trust Policy
Private Purpose Trust
- 68 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 3 - Detail Notes on Transaction Classes/Accounts:
Capital Assets
Capital asset activity for the year ended June 30, 2017, was as follows:
Balance Balance
Primary Government: July 1, 2016 Additions Deductions June 30, 2017
Capital assets, not being depreciated:
Land $10,393,332 $ - $ 16,500 $10,376,832
Construction-in-progress 13,293,457 7,763,328 1,047,404 20,009,381
Total capital assets, not being
depreciated 23,686,789 7,763,328 1,063,904 30,386,213
Capital assets, being depreciated:
Land improvements 12,901,662 422,189 - 13,323,851
Buildings and improvements 19,034,719 525,215 173,197 19,386,737
Infrastructure 41,625,986 131,087 - 41,757,073
Equipment 8,411,539 596,116 165,874 8,841,781
Furnishings and fixtures 215,936 13,140 7,735 221,341
Vehicles 9,160,408 825,614 651,328 9,334,694
Totals at historical cost 91,350,250 2,513,361 998,134 92,865,477
Less accumulated depreciation:
Land improvements 3,151,930 760,814 - 3,912,744
Buildings and improvements 13,204,462 386,479 130,269 13,460,672
Infrastructure 30,749,909 1,076,883 - 31,826,792
Equipment 6,736,019 375,832 165,874 6,945,977
Furnishings and fixtures 203,394 3,344 7,735 199,003
Vehicles 5,374,307 848,961 633,489 5,589,779
Total accumulated depreciation 59,420,021 3,452,313 937,367 61,934,967
Total capital assets, being
depreciated, net 31,930,229 (938,952) 60,767 30,930,510
PRIMARY GOVERNMENT
ACTIVITIES CAPITAL
ASSETS, NET $55,617,018 $ 6,824,376 $1,124,671 $61,316,723
(Continued)
- 70 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 3 - Detail Notes on Transaction Classes/Accounts:
Capital Assets
Balance Balance
Business-type Activities: July 1, 2016 Increases Decreases June 30, 2017
Capital assets, not being depreciated:
Land $ 62,152 $ - $ - $ 62,152
Total capital assets, not being
depreciated 62,152 - - 62,152
Capital assets, being depreciated:
Buildings and improvements 571,759 - - 571,759
Equipment 1,516,052 136,521 89,201 1,563,372
Vehicles 2,921,255 739,246 667,748 2,992,753
Totals at historical cost 5,009,066 875,767 756,949 5,127,844
Less accumulated depreciation:
Buildings and improvements 300,435 16,327 - 316,762
Equipment 1,155,404 122,078 78,980 1,198,502
Vehicles 1,936,651 253,042 667,748 1,936,651
Total accumulated depreciation 3,392,490 391,447 746,728 3,037,209
Total capital assets, being
depreciated, net 1,616,576 484,320 10,221 2,090,675
BUSINESS-TYPE ACTIVITIES
CAPITAL ASSETS, NET $ 1,678,728 $ 484,320 $ 10,221 $ 2,152,827
Balance Balance
Discretely Presented July 1, 2016 Increases Decreases June 30, 2017
Component Units:
Capital assets, not being depreciated:
Land & construction in progress $ 1,626,870 $ 3,182,992 $ - $ 4,809,862
Capital assets, being depreciated:
Utility plant 87,917,041 2,746,299 2,348,969 88,314,371
Less accumulated depreciation:
Utility plant 37,963,019 2,179,062 2,308,055 37,834,026
Total capital assets, being
depreciated, net 49,954,022 567,237 40,914 50,480,345
COMPONENT UNIT
CAPITAL ASSETS, NET $ 51,580,892 $ 3,750,229 $ 40,914 $ 55,290,207
Depreciation expense, charged to functions/programs of discretely presented major component units as
follows:
Paducah Water Works $ 2,179,062
(Continued)
Governmental Activities
Business-type Activities
General Obligation Bonds
General Obligation Bonds
Advance Refunding
Notes Payable
- 75 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
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, 2017:
Beginning Ending Due within
Type of Liability: Balance Additions Reductions Balance One Year
Governmental activities:
General obligation bonds:
Floodwall Rehabilitation $ 1,990,271 $ - $ (128,148) $ 1,862,123 $ 132,130
Refinanced Pension 4,055,000 - (395,000) 3,660,000 405,000
Refinanced Convention Center 4,955,000 - (440,000) 4,515,000 450,000
Refinanced Rental Building 2,530,000 - (300,000) 2,230,000 310,000
Public Pool Renovations 990,000 - (65,000) 925,000 65,000
Economic Development 2,185,000 - (145,000) 2,040,000 145,000
Refinancing Public Projects 4,805,000 - (300,000) 4,505,000 310,000
Premiums 179,492 - (22,684) 156,808 -
Discounts (94,667) - 16,545 (78,122) -
Total bonds payable 21,595,096 - (1,779,287) 19,815,809 1,817,130
Notes payable:
Kentucky League of Cities 1,500,126 - (190,510) 1,309,616 196,297
Kentucky Association of
Counties 1,866,666 - (115,000) 1,751,666 119,583
Margaret Hank Agreement 94,851 - (46,917) 47,934 47,934
Murray State University
Agreement 2,224,792 - (115,704) 2,109,088 117,601
CFSB Agreement - 3,000,000 - 3,000,000 42,417
Total notes payable 5,686,435 3,000,000 (468,131) 8,218,304 523,832
Pension Obligations 41,221,575 6,006,015 (2,911,647) 44,315,943 -
Accrued Compensated
Absences 2,083,261 1,330,693 (1,299,175) 2,114,779 1,318,470
TOTAL GENERAL LONG-
TERM LIABILITIES $70,586,367 $10,336,708 $ (6,458,240) $ 74,464,835 $ 3,659,432
Business-type activities:
Pension Obligations $ 1,884,418 $ 327,280 $ (125,218) $ 2,086,480 -
Accrued compensated
Absences 173,919 99,129 (79,526) 193,522 115,283
TOTAL BUSINESS LONG-
TERM LIABILITIES $ 2,058,337 $ 426,409 $ (204,744) $ 2,280,002 $ 115,283
(Continued)
Changes in Long-Term Liabilities
Less
Annual Debt Service Requirements
- 77 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 3 - Detail Notes on Transaction Classes/Accounts:
Accrued Compensated Absences
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, 2017, are as
follows:
Accrued Compensated Absences
Governmental Business-type
Activities Activities
Accrued sick leave $ 715,692 $ 77,693
Accrued vacation leave 1,399,087 115,829
Totals 2,114,779 193,522
Less current portion 1,318,470 115,283
LONG-TERM PORTION $ 796,309 $ 78,239
Termination Benefits
Nine 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, 2017.
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, 2017, $87,965 of payments was 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, 2017, 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.
(Continued)
Plan description -
Benefits provided
Non-hazardous members:
Hazardous members:
Plan Funding
Non-hazardous Hazardous
Actuarial assumptions -
Discount rate
Sensitivity of CERS proportionate share of net pension liability to changes in the discount rate
CERS
Pension plan fiduciary net position
Basis of Accounting
Administration
Administrative Costs
Valuation of Investments
Plan Administration
Plan Description
Membership Information:
Benefits provided:
Funding policy:
- 86 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 4 - Pension Plans - City of Paducah:
Single Employer Defined Benefit Funds - Police and Firefighters' Pension Fund (PFPF) and
Appointive Employees’ Pension Fund (AEPF)
Changes in PFPF and AEPF’s Net Pension Liability is as follows:
PFPF
Total
Pension
Liability
Plan
Net
Position
Net
Pension
Liability
(a) (b) (a) – (b)
Balance – June 30, 2016 $ 9,893,474 $ 5,644,261 $ 4,249,213
Service cost 7,038 - 7,038
Interest expense 626,531 - 626,531
Experience losses (gains) (278,063) - (278,063)
Change in assumptions 148,359 - 148,359
Contributions – City - 436,575 (436,575)
Contributions – Members - 4,001 (4,001)
Investment income - 766,509 (766,509)
Benefits paid (1,223,078) (1,223,078) -
Plan administrative expenses - (44,786) 44,786
Net change (719,213) (60,779) (658,434)
Balance – June 30, 2017 $ 9,174,261 $ 5,583,482 $ 3,590,779
AEPF
Total
Pension
Liability
Plan
Net
Position
Net
Pension
Liability
(a) (b) (a) – (b)
Balance – June 30, 2016 $ 95,226 $ - $ 95,226
Service cost - - -
Interest expense 5,308 - 5,308
Experience losses (gains) (13,742) - (13,742)
Change in assumptions - - -
Contributions – City - 21,062 (21,062)
Contributions – Members - - -
Investment income - - -
Benefits paid (13,533) (13,533) -
Plan administrative expenses - (7,529) 7,529
Net change (21,967) - (21,967)
Balance – June 30, 2017 $ 73,259 $ - $ 73,259
For the year ended June 30, 2017, the City recognized pension expense of $75,898 and $191 related to
PFPF and AEPF pension plans, respectively.
(Continued)
Actuarial assumption
Post-retirement mortality
Rate of return
Discount Rate
Sensitivity of the net pension liability to changes in the discount rate
- 90 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 4 - Pension Plans - City of Paducah:
Single Employer Defined Benefit Funds - Police and Firefighters' Pension Fund (PFPF) and
Appointive Employees’ Pension Fund (AEPF)
COMBINING STATEMENT OF CHANGES IN NET POSITION
PENSION TRUST FUNDS
JUNE 30, 2017
PFPF AEPF Total
Additions:
Contributions
Employer $ 436,575 $ 21,062 $ 457,637
Plan members 4,001 - 4,001
Total contributions 440,576 21,062 461,638
Investments earnings:
Net change in fair value of investments 657,159 - 657,159
Interest and dividends 109,351 - 109,351
Net investment earnings 766,510 - 766,510
Total additions 1,207,086 21,062 1,228,148
Deductions:
Benefits 1,223,078 13,533 1,236,611
Administrative expenses 44,786 7,529 52,315
Total deductions 1,267,864 21,062 1,288,926
Change in net position (60,778) - (60,778)
Net position - beginning 5,644,260 - 5,644,260
Net position - ending $ 5,583,482 $ - $ 5,583,482
Note 5 - Component Unit Long-Term Liabilities:
Long-term liabilities of the discretely presented component units consist of the following at June 30, 2017:
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 rate is 1.00%, with a .25% annual service fee. The annual requirements to amortize the
outstanding debt as of June 30, 2017, are as follows:
.25%
Year Ending Service R & M
June 30 Principal Interest Fee Reserve Total
2018 $ 450,271 $ 92,178 $ 18,712 $ 29,950 $ 591,111
2019 455,532 86,971 17,584 29,950 590,037
2020 460,856 81,646 16,442 29,950 588,894
2021 466,250 76,252 15,287 29,950 587,739
2022 471,709 70,793 14,117 11,200 567,819
2023-2027 2,442,870 269,640 52,561 56,000 2,821,071
2028-2032 2,185,818 123,468 21,464 - 2,330,750
2033-2037 664,003 32,374 4,626 - 701,003
TOTALS $7,597,309 $833,322 $160,793 $187,000 $8,778,424
(Continued)
- 91 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 6 - Appropriations Deficit:
No departments that adopted budgets annually had excess expenditures over appropriations for the fiscal
year ended June 30, 2017.
Note 7 - Commitments and Contingencies:
Grant Contingencies
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, 2017, the most significant construction commitment were as follows:
Cumulative Estimated
Costs Incurred Total Costs
Comprehensive Stormwater Master Plan Study $ 178,230 $ 986,446
Riverfront Development – Phase 1b 8,267,257 8,300,000
City Hall Improvement – Phase I 50,550 4,857,000
$ 8,496,037 $14,143,446
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 Payments Year End
2014 - 2015 $ - $ 32,834 $ 32,834 $ -
2015 - 2016 - 95,720 95,720 -
2016 - 2017 - 110,570 110,570 -
(Continued)
- 93 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 9 - Lease Agreements:
Operating Leases
Depreciation expense for the year ended June 30, 2017, on leased property was $81,466.
The following is a schedule of future minimum rental income from operating leases at June 30, 2017:
Lease
Income
2018 $ 746,749
2019 746,749
2020 738,415
2021 535,435
2022 304,031
2023-2024 578,000
TOTAL MINIMUM LEASE RECEIPTS $3,649,379
Note 10 – Tax Abatements:
Developer Residential Property Tax Abatements –
The City of Paducah is authorized by Kentucky Revised Statues Chapter 81A and City Ordinance 2002-
10-6989 to enter into property tax abatement agreements for the purpose of subsidizing developers for
their cost of infrastructure improvements associated with residential infill and annexation development.
Tax reimbursements cannot exceed the cost of City-approved infrastructure associated with the
development over the life of the agreement. The abatement is limited to the actual City of Paducah real
estate property taxes collected in any given year attributed to a specific development area as outlined in the
individual agreement with the City.
For the year ended June 30, 2017, the City abated property taxes totaling $25,878 under this program,
including the following tax abatement agreements:
Recipient Development Agreement
Ordinance
Abatement Amount
Current
Year
Inception to
Date
Signature Homes of
Paducah, LLC
Westwood Subdivision
In-fill 2010-12-7768 $11,922 $62,136
Greenway Village,
LLC
Greenway Village In-
fill 2011-2-7789 $13,956 $27,333
Kentucky Business Investment (KBI) Program, KRS 154.32 –
The KBI Program provides income tax credits and wage assessments to new and existing manufacturing
companies, and non-retail service companies that locate or expand operations in Kentucky. The Program
can be set to last up to 10 years.
(Continued)
- 94 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 10 – Tax Abatements:
For the year ended June 30, 2017, the City rebated employee local payroll taxes totaling $2,966 under this
program, including the following resolutions:
Recipient Start Date Term Authority
Payroll Tax
Rebate Amount
Current
Year
Inception to
Date
Dippin’ Dots, LLC 12-11-2016 10 yrs. Resolution - 2014 $2,966 $2,966
Industrial Park West (IPW) – Ordinance 1997-2-5642 authorized the joint development of the IPW, for
economic development purposes, as well as an inter-local agreement authorizing the city to share 50% of
all payroll tax revenue generated in the Park. This agreement is good for 10 years after 97% of the park
property is developed or 25 years (March 6, 2022), whichever is first.
For the year ended June 30, 2017, the City shared payroll tax revenue totaling $105,830 under this
agreement with McCracken County (“County”), as follows:
Payroll Tax Remitter Start Date
Payroll Tax Revenue Shared
Current Year Inception to
Date
Coca Cola September 2005 $13,853 $294,826
Genova September 2014 $21,609 $35,253
H.T. Hackney March 2012 $24,952 $116,238
Whitehall December 2014 $45,416 $89,727
Information Age Park (IAP) – Ordinance 2005-11-7046 authorized an inter-local agreement between the
City and County relating to payroll tax revenue generated in the Park. If the City invites the County to
participate in the cost of an economic development project, the City will share 50% of all payroll tax
revenue generated through the term of the agreement which expires February 13, 2021.
For the year ended June 30, 2017, the City shared payroll tax revenue totaling $216,164 under this
agreement with the County, as follows:
Payroll Tax Remitter Start Date
Payroll Tax Revenue Shared
Current Year Inception to
Date
Lynx March 2006 $78,057 $620,793
Ulrich March 2006 $13,656 $152,939
Pepsi December 2007 $3,182 $73,638
Marquette March 2008 $77,823 $732,778
Teletech December 2014 $43,446 $121,880
(Continued)
- 95 -
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2017
Note 10 – Tax Abatements:
AAA (Pebco) – Ordinance 2004-6-6824 authorized an inter-local agreement between the City and County
relating to payroll tax revenue generated by the AAA Company on Coleman Road. The City and County
partnered on an economic development project which calls for the City to share 50% of all payroll tax
revenue generated at the AAA facility on Coleman Road for 25 years, through 2029.
For the year ended June 30, 2017, the City shared payroll tax revenue totaling $11,374 under this agreement
with the County, as follows:
Payroll Tax Remitter Start Date
Payroll Tax Revenue Shared
Current Year Inception to
Date
AAA (Pebco) July 2005 $11,374 $140,814
Other Local Economic Development Programs –
In order to attract certain companies to the Paducah area, the City and County partnered together to
construct facilities to house corporate operations in the Information Age Park (IAP) and the Industrial Park
West (IPW).
For the year ended June 30, 2017, the City and County provided reduced rent for the following corporate
recipients, totaling $466,000:
Recipient Location Bldg.
Size
Agreement
Ordinance
FMV
Rent Rent Paid
Genova 5400 Commerce Drive 100,000 sf 2014-7-8162 $425,000 $289,000
Teletech 2301 McCracken Blvd. 30,000 sf 2012-11-7986 $330,000 None
Note 11 – New Accounting Pronouncements:
The Governmental Accounting Standards Board issued Statement No. 75, Accounting and Financial
Reporting for Postemployment Benefits Other than Pensions which is effective for the City beginning July
1, 2017. The total effect has yet to be determined but is expected to be significant.
2017 2016 2015 2014
Total pension liability
Service cost 7,038$ 7,183$ 5,576$ 4,871$
Interest 626,531 686,614 744,910 792,267
Changes in benefit terms - - - -
Differences between expected and actual experience (278,063) (111,824) (43,965) 150,977
Changes in assumptions 148,359 156,880 166,753 175,893
Benefit payments/refunds (1,223,078) (1,308,290) (1,386,273) (1,445,080)
Net change in total pension liability (719,213) (569,437) (512,999) (321,072)
Total pension liability - beginning 9,893,474 10,462,911 10,975,910 11,296,982
Total pension liability - ending (a)9,174,261$ 9,893,474$ 10,462,911$ 10,975,910$
Plan fiduciary net position
Contributions - employer 436,575$ 420,352$ 391,468$ 420,834$
Contributions - member 4,001 4,494 6,088 5,354
Net investment income 766,509 165,489 310,681 1,057,726
Benefit payments/refunds (1,223,078) (1,308,290) (1,386,273) (1,445,080)
Administrative expenses (44,786) (46,422) (49,115) (48,406)
Other - - - -
Net change in plan fiduciary net position (60,779) (764,377) (727,151) (9,572)
Plan fiduciary net position - beginning 5,644,261 6,408,638 7,135,789 7,145,361
Plan fiduciary net position - ending (b)5,583,482$ 5,644,261$ 6,408,638$ 7,135,789$
Net pension liability ending (a) - (b)3,590,779$ 4,249,213$ 4,054,273$ 3,840,121$
Plan fiduciary net position as a percentage of total pension liability 61%57%61%65%
Covered-employee payroll 50,009$ 56,175$ 76,102$ 66,928$
Net pension liability as a percentage of covered-employee payroll 7180% 7564% 5327% 5738%
(1)
-96-
Exhibit A-1
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE POLICE AND FIREFIGHTERS' PENSION
Last Four Fiscal Years Ending June 30 (1)
TRUST FUND'S NET PENSION LIABILITY AND RELATED RATIOS
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided as this
information becomes available.
2017 2016 2015 2014
Total pension liability
Service cost -$ -$ -$ -$
Interest 5,308 5,400 5,687 8,258
Changes in benefit terms - - - -
Differences between expected and actual experience 13,742 9,751 9,391 (30,605)
Changes in assumptions - - - -
Benefit payments/refunds (13,533) (19,856) (19,856) (21,152)
Net change in total pension liability 5,517 (4,705) (4,778) (43,499)
Total pension liability - beginning 99,931 99,931 104,709 148,208
Total pension liability - ending (a)105,448$ 95,226$ 99,931$ 104,709$
Plan fiduciary net position
Contributions - employer 21,062$ 6,599$ -$ -$
Contributions - member - - - -
Net investment income - 53 264 598
Benefit payments/refunds (13,533) (19,856) (19,856) (21,152)
Administrative expenses (7,529) (7,539) (7,533) (7,483)
Other - - - -
Net change in plan fiduciary net position - (20,743) (27,125) (28,037)
Plan fiduciary net position - beginning - 20,743 47,868 75,905
Plan fiduciary net position - ending (b)-$ -$ 20,743$ 47,868$
Net pension liability ending (a) - (b)105,448$ 95,226$ 79,188$ 56,841$
Plan fiduciary net position as a percentage of total pension liability 0.0%0.0%20.8% 45.7%
Covered-employee payroll n/a n/a n/a n/a
Net pension liability as a percentage of covered-employee payroll n/a n/a n/a n/a
(1)
-97-
Exhibit A-2
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE APPOINTIVE EMPLOYEES' PENSION
TRUST FUND'S NET PENSION LIABILITY AND RELATED RATIOS
Last Four Fiscal Years Ending June 30 (1)
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided
as this information becomes available.
2017 2016 2015 2014
Actuarially determined contribution 434,758$ 416,844$ 391,468$ 421,933$
Contributions in relation to the actuarially
determined contribution 436,575 420,352 391,468 420,834
Contribution deficiency (excess)(1,817)$ (3,508)$ -$ 1,099$
Covered-employee payroll 50,009$ 56,175$ 76,102$ 66,928$
Contributions as a percentage of covered-employee payroll 873% 748% 514% 629%
2017 2016 2015 2014
Annual money-weighted rate of return, net of investment expens 14.61% 2.78% 4.69% 15.95%
(1)
Exhibit A-3
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF POLICE AND FIREFIGHTERS' PENSION TRUST FUND
CONTRIBUTIONS AND INVESTMENT RETURNS
Last Four Fiscal Years Ending June 30 (1)
Schedule of Contributions
Schedule of Investment Returns
-98-
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided
as this information becomes available.
2017 2016 2015 2014
Actuarially determined contribution 19,856$ 19,856$ 15,734$ 10,779$
Contributions in relation to the actuarially
determined contribution 21,062 6,599 - -
Contribution deficiency (excess)(1,206)$ 13,257$ 15,734$ 10,779$
Covered-employee payroll n/a n/a n/a n/a
Contributions as a percentage of covered-employee payroll n/a n/a n/a n/a
2017 2016 2015 2014
Annual money-weighted rate of return, net of investment expense 0.00% 0.47% 0.75% 0.97%
(1)
Last Four Fiscal Years Ending June 30 (1)
Exhibit A-4
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF APPOINTIVE EMPLOYEES' PENSION TRUST FUNDS
CONTRIBUTIONS AND INVESTMENT RETURNS
-99-
Schedule of Contributions
Schedule of Investment Returns
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided
as this information becomes available.
Year Ended
June 30
City's
proportion
of the net
pension
liability
City's
proportionate share
of the net pension
liability (asset)
City's covered
employee payroll
City's share of the
net pension
liability (asset) as
a percentage of its
covered employee
payroll
Plan fiduciary
net position as a
percentage of
the total pension
liability
CERS Nonhazardous
2017 0.3047% 14,999,862 7,266,510 206.4246% 55.5028%
2016 0.3150% 13,543,354 7,349,249 184.2821% 59.9684%
2015 0.3261% 10,579,475$ 7,477,608$ 141.4821% 66.8010%
2014 0.3261% 11,970,884$ 7,466,979$ 160.3176% 61.2209%
CERS Hazardous
2017 1.6165% 27,738,524$ 8,404,139$ 330.0579% 53.9483%
2016 1.6428% 25,218,200$ 8,402,943$ 300.1115% 57.5152%
2015 1.6323% 19,617,569$ 8,267,598$ 237.2826% 63.4574%
2014 1.6323% 21,907,757$ 8,016,505$ 273.2831% 65.7178%
*The amounts presented were determined as of the measurement date June 30 of the prior year.
*
Exhibit A-5
-100-
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY
COUNTY EMPLOYEES' RETIREMENT SYSTEM
LAST FOUR FISCAL YEARS*
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided as
this information becomes available.
REQUIRED SUPPLEMENTARY INFORMATION
Year Ended
June 30
Contractually
required penson
contribution
Contributions
relative to
contractually
required
contribution
Contribution
deficiency (excess)
City's covered
employee
payroll
Contributions
as a percentage
of covered
employee
payroll
CERS Nonhazardous
2017 1,098,317$ 1,098,317$ -$ 7,861,744$ 13.9704%
2016 902,501$ 902,501$ -$ 7,266,510$ 12.4200%
2015 937,029$ 937,029$ -$ 7,349,249$ 12.7500%
2014 1,027,423$ 1,027,423$ -$ 7,477,608$ 13.7400%
CERS Hazardous
2017 1,954,791$ 1,954,791$ -$ 9,004,106$ 21.7100%
2016 1,702,679$ 1,702,679$ -$ 8,404,139$ 20.2600%
2015 1,741,930$ 1,741,930$ -$ 8,402,943$ 20.7300%
2014 1,799,856$ 1,799,856$ -$ 8,267,598$ 21.7700%
*
Changes of Benefit Terms:
A cash balance plan was introduced for member whose participation date is on or after January 1, 2014.
Changes of assumptions:
The assumptions were updated as of result of an experience study for the three year period ending June 30, 2008.
The discount rate changed from 7.75% to 7.50% from the prior measurement date.
The inflation rate changed from 3.50% to 3.25% from the prior measurment date.
Exhibit A-6
-101-
Notes to Required Supplementary Information
For the Year Ended June 30, 2016
The amortization period of the unfunded accrued liability was reset to a closed 30 year period for the year ended June 30,
2013.
Schedule is intended to show information for 10 years. Additional years of supplementary information will be provided
as this information becomes available.
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF CITY'S CONTRIBUTIONS
COUNTY EMPLOYEES' RETIREMENT SYSTEM
LAST THREE FISCAL YEARS*
REQUIRED SUPPLEMENTARY INFORMATION
Exhibit B-1
Variance with
Final Budget
Final Positive
Budget (Negative)
Revenues:
Grants 5,487,300$ 5,487,305$ 5$
Interest 3,680 3,682 2
Property upkeep, rentals, sales and other 618,875 618,885 10
Total revenues 6,109,855 6,109,872 17
Expenditures:
Capital outlay 10,148,320 10,148,302 18
Excess (deficiency) of revenues over
expenditures (4,038,465) (4,038,430) 35
Other Financing Sources (Uses):
Operating transfers in 6,316,810 6,316,818 8
Operating transfers out (126,315) (126,308) (7)
Total other financing sources 6,190,495 6,190,510 1
Net change in fund balance 2,152,030$ 2,152,080 36$
Fund balance, July 1, 2016 5,803,064
FUND BALANCE, JUNE 30, 2017 7,955,144$
See auditors report on pages 11-12.
-102-
Actual
CITY OF PADUCAH, KENTUCKY
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
GENERAL CAPITAL IMPROVEMENTS FUND
FOR THE YEAR ENDED JUNE 30, 2017
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
Exhibit B-2
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Intergovernmental 701,775$ 636,772$ (65,003)$
Property upkeep, rentals, sales and other 289,000 288,995 (5)
Total revenues 990,775 925,767 (65,008)
Expenditures:
Debt service:
Principal requirement 2,513,695 2,244,361 269,334
Interest and fiscal requirement 955,300 810,917 144,383
Total expenditures 3,468,995 3,055,278 413,717
Excess (deficiency) of revenues over
expenditures (2,478,220) (2,129,511) 348,709
Other Financing Sources (Uses):
Operating transfers in 2,478,220 2,377,511 (100,709)
Total other financing sources 2,478,220 2,377,511 (100,709)
Net change in fund balance -$ 248,000 248,000$
Fund balance, July 1, 2016 750,824
FUND BALANCE, JUNE 30, 2017 998,824$
See auditors report on pages 11-12.
-103-
FOR THE YEAR ENDED JUNE 30, 2017
CITY OF PADUCAH, KENTUCKY
DEBT SERVICE FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
NONMAJOR GOVERNMENTAL FUNDS
Exhibit B-3
Court
Awards
Fund
Cash and cash equivalents 665,970$ 310,800$ 187,697$
Receivables, net:
Accounts 46,827 136,566 -
TOTAL ASSETS 712,797$ 447,366$ 187,697$
Liabilities:
Voucher and accounts payable 107,391$ 90,475$ 56,642$
Accrued payroll and payroll taxes - 29,774 -
Total liabilities 107,391 120,249 56,642
Fund Balances:
Restricted for:
Highway and streets 605,406 - -
Public safet y - - 131,055
Capital Improvements - - -
Assigned for:
Public safet y - 327,117 -
Total fund balances 605,406 327,117 131,055
TOTAL LIABILITIES AND
FUND BALANCES 712,797$ 447,366$ 187,697$
See auditors report on pages 11-12.
JUNE 30, 2017
FUND BALANCES
Municipal
Aid Program
Special Revenue Funds
CITY OF PADUCAH, KENTUCKY
COMBINING BALANCE SHEET
ASSETS
-104-
Emergency
AND
NONMAJOR GOVERNMENTAL FUNDS
LIABILITIES
Service Fund
Communication
CDBG
Grant Bond
Fund Fund
-$ 1,624,457$ 2,788,924$
- - 183,393
-$ 1,624,457$ 2,972,317$
-$ 92,213$ 346,721$
- - 29,774
- 92,213 376,495
- - 605,406
- - 131,055
- 1,532,244 1,532,244
- - 327,117
- 1,532,244 2,595,822
-$ 1,624,457$ 2,972,317$
Funds
Total Nonmajor
Special Revenue Funds
-105-
Governmental
Exhibit B-4
Court
Awards
Revenues: Fund
Taxes -$ 448,257$ -$
Charges for services - 313,705 -
Intergovernmental 503,850 - -
Grants - - 18,441
Interest 5,382 1,821 1,213
Miscellaneous - 427,132 -
Total revenues 509,232 1,190,915 19,654
Expenditures:
Current operations:
Public safety - 1,591,402 35,817
Public service 1,684,762 - -
Planning and development - - -
Capital Outlay - - -
Total expenditures 1,684,762 1,591,402 35,817
Excess (deficiency) of revenues
over expenditures (1,175,530) (400,487) (16,163)
Other Financing Sources (Uses):
Proceeds of debt - - -
Transfers in 632,147 436,126 -
Transfers out - (7,500) -
Total other financing sources (uses) 632,147 428,626 -
Net change in fund balances (543,383) 28,139 (16,163)
Fund balances, July 1, 2016 1,148,789 298,978 147,218
FUND BALANCES, JUNE 30, 2017 605,406$ 327,117$ 131,055$
See auditors report on pages 11-12.
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2017
Emergency
Service Fund
-106-
Aid Program
Municipal
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
Special Revenue Funds
Communication
CDBG
Grant Bond
Fund Fund
-$ -$ 448,257$
- - 313,705
- - 503,850
209,000 - 227,441
- 5,737 14,153
- - 427,132
209,000 5,737 1,934,538
- - 1,627,219
- - 1,684,762
209,000 - 209,000
- 138,901 138,901
209,000 138,901 3,659,882
- (133,164) (1,725,344)
- 3,000,000 3,000,000
- - 1,068,273
- (1,334,592) (1,342,092)
- 1,665,408 2,726,181
- 1,532,244 1,000,837
- - 1,594,985
-$ 1,532,244$ 2,595,822$
Total Nonmajor
-107-
Funds
Special Revenue Funds
Governmental
Exhibit B-5
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Intergovernmental 450,000$ 503,850$ 53,850$
Interest 6,000 5,382 (618)
Total revenues 456,000 509,232 53,232
Expenditures:
Public service 2,023,000 1,684,762 338,238
Excess (deficiency) of revenues over
expenditures (1,567,000) (1,175,530) 391,470
Other Financing Sources (Uses):
Operating transfers in 613,845 632,147 18,302
Operating transfers out - - -
Total other financing sources (uses)613,845 632,147 18,302
Net change in fund balance (953,155) (543,383) 409,772
Fund balance, July 1, 2016 1,148,789 1,148,789 -
FUND BALANCE, JUNE 30, 2017 195,634$ 605,406$ 409,772$
See auditors report on pages 11-12.
-108-
FOR THE YEAR ENDED JUNE 30, 2017
CITY OF PADUCAH, KENTUCKY
MUNICIPAL AID PROGRAM FUND
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
Exhibit B-6
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Local contributions 360,000$ 448,257$ 88,257$
Telephone surcharges 270,000 313,705 43,705
Interest 900 1,821 921
Miscellaneous 506,770 427,132 (79,638)
Total revenues 1,137,670 1,190,915 53,245
Expenditures:
Public safety 1,748,780 1,591,402 157,378
Excess (deficiency) of revenues over
expenditures (611,110) (400,487) 210,623
Other Financing Sources (Uses):
Operating transfers in 618,610 436,126 (182,484)
Operating transfers out (7,500) (7,500) -
Total other financing sources (uses)611,110 428,626 (182,484)
Net change in fund balance -$ 28,139 28,139$
Fund balance, July 1, 2016 298,978
FUND BALANCE, JUNE 30, 2017 327,117$
See auditors report on pages 11-12.
-109-
FOR THE YEAR ENDED JUNE 30, 2017
CITY OF PADUCAH, KENTUCKY
EMERGENCY COMMUNICATION SERVICE FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
Exhibit B-7
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Grants 25,000$ 18,441$ (6,559)$
Interest 1,200 1,213 13
Total revenues 26,200 19,654 (6,546)
Expenditures:
Public safety 30,750 35,817 (5,067)
Excess (deficiency) of revenues over
expenditures (4,550) (16,163) (11,613)
Net change in fund balance (4,550)$ (16,163) (11,613)$
Fund balance, July 1, 2016 147,218
FUND BALANCE, JUNE 30, 2017 131,055$
See auditors report on pages 11-12.
-110-
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, 2017
Exhibit B-8
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Grants 209,000$ 209,000$ -$
Total revenues 209,000 209,000 -
Expenditures:
Planning and development 209,000 209,000 -
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, 2016 -
FUND BALANCE, JUNE 30, 2017 -$
See auditors report on pages 11-12.
-111-
FOR THE YEAR ENDED JUNE 30, 2017
CITY OF PADUCAH, KENTUCKY
CDBG FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
Exhibit B-9
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Grants -$ -$ -$
Interest - 5,737 5,737
Total revenues - 5,737 5,737
Expenditures:
Capital outlay - 138,901 (138,901)
Total expenditures - 138,901 (138,901)
Excess (deficiency) of revenues over
expenditures - (133,164) (133,164)
Other Financing Sources (Uses):
Proceeds of debt 8,350,000 3,000,000 (5,350,000)
Operating transfers in - - -
Operating transfers out (8,350,000) (1,334,592) 7,015,408
Total other financing sources (uses) - 1,665,408 1,665,408
Net change in fund balance -$ 1,532,244 1,532,244$
Fund balance, July 1, 2016 -
FUND BALANCE, JUNE 30, 2017 1,532,244$
See auditors report on pages 11-12.
-112-
FOR THE YEAR ENDED JUNE 30, 2017
CITY OF PADUCAH, KENTUCKY
BOND FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
NONMAJOR PROPRIETARY FUNDS
Exhibit C-1
Civic Transient
Center Dock
Current Assets: Fund Fund
Cash and cash equivalents 338,110$ 78,000$ 3,974$ 420,084$
Total current assets 338,110 78,000 3,974 420,084
Noncurrent Assets:
Net depreciable capital assets 143 119,511 - 119,654
Total assets 338,253 197,511 3,974 539,738
Deferred Outflows of Resources:
Deferred pension related outflows 66,095 - - 66,095
Current Liabilities:
Voucher and accounts payable 36,341 6,190 - 42,531
Accrued compensated absences 1,987 - - 1,987
Due to other funds 52,710 - - 52,710
Total current liabilities 91,038 6,190 - 97,228
Noncurrent Liabilities:
Pensions obligation 292,497 - - 292,497
Accrued compensated absences 17,883 - - 17,883
Total noncurrent liabilities 310,380 - - 310,380
Total liabilities 401,418 6,190 - 407,608
Deferred Inflows of Resources
Deferred pension related inflows 8,761 - - 8,761
Net invested in capital assets 143 119,511 - 119,654
Unrestricted (5,974) 71,810 3,974 69,810
TOTAL NET POSITION (5,831)$ 191,321$ 3,974$ 189,464$
See auditors report on pages 11-12.
NET POSITION
-113-
Total Nonmajor
Enterprise
Funds
Section
Eight
Housing
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF NET POSITION
NONMAJOR PROPRIETARY FUNDS
JUNE 30, 2017
ASSETS
LIABILITIES
Exhibit C-2
Civic Transient
Center Dock
Operating Revenues:Fund Fund
Charges for services -$ 36,725$ -$ 36,725$
Miscellaneous 4,038 - - 4,038
Total operating income 4,038 36,725 - 40,763
Operating Expenses:
Cost of sales and service 1,952,018 82,451 1,031 2,035,500
Depreciation and amortization 423 10,021 - 10,444
Total operating expenses 1,952,441 92,472 1,031 2,045,944
Operating income (loss)(1,948,403) (55,747) (1,031) (2,005,181)
Non-Operating Revenues (Expenses):
Grants - program purpose 1,903,723 - - 1,903,723
Interest and investment income 35 - 5 40
Total nonoperating revenues
(expenses)1,903,758 - 5 1,903,763
Income (loss) before contributions and
transfers (44,645) (55,747) (1,026) (101,418)
Contributions and Operating Transfers:
Transfers in - 45,623 5,000 50,623
Transfers out - - - -
Total contributions and operating transfers - 45,623 5,000 50,623
Change in net position (44,645) (10,124) 3,974 (50,795)
Net position - beginning 38,814 201,445 - 240,259
Net position - ending (5,831)$ 191,321$ 3,974$ 189,464$
See auditors report on pages 11-12.
-114-
FOR THE YEAR ENDED JUNE 30, 2017
NONMAJOR PROPRIETARY FUNDS
AND CHANGES IN NET POSITION
Funds
Section
Eight
Housing
COMBINING STATEMENT OF REVENUES, EXPENSES
CITY OF PADUCAH, KENTUCKY
Total Nonmajor
Enterprise
Exhibit C-3
Civic Transient
Center Dock
Cash Flows from Operating Activities: Fund Fund
Cash received from customers -$ 36,725$ -$ 36,725$
Payments to employees (177,762) - - (177,762)
Payments to internal service funds - (2,301) - (2,301)
Other receipts 4,038 - - 4,038
Housing assistance and other payments (1,728,832) (80,047) (1,031) (1,809,910)
Net cash provided (used) by operating activities (1,902,556) (45,623) (1,031) (1,949,210)
Cash Flows from Noncapital
Financing Activities:
Grants - program purpose 1,903,723 - - 1,903,723
Transfers from other funds - 45,623 5,000 50,623
Transfers to other funds - - - -
Net cash provided (used) by noncapital
financing activities 1,903,723 45,623 5,000 1,954,346
Cash Flows from Investing Activities:
Interest on cash and investments 35 - 5 40
Net increase (decrease) in cash and cash
equivalents 1,202 - 3,974 5,176
Cash and cash equivalents, July 1, 2016 336,908 78,000 - 414,908
CASH AND CASH EQUIVALENTS,
JUNE 30, 2017 338,110$ 78,000$ 3,974$ 420,084$
Reconciliation of Operating Income (Loss) to
Net Cash Provided by Operating Activities:
Operating income (loss)(1,948,403)$ (55,747)$ (1,031)$ (2,005,181)$
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:
Depreciation and amortization 423 10,021 - 10,444
Change in assets and liabilities:
Unearned revenues - - - -
Pension obligation and related deferrals 15,780 - 15,780
Accounts payable and accrued expenses 29,644 103 - 29,747
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES (1,902,556)$ (45,623)$ (1,031)$ (1,949,210)$
See auditors report on pages 11-12.
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2017
-115-
Section
Eight
Housing
Total Nonmajor
Enterprise
Funds
INTERNAL SERVICE FUNDS
Exhibit D-1
Health
Fleet Lease Insurance Insurance Combined
Current Assets:Trust Fund Fund Total
Cash and cash equivalents 2,345$ 1,879,897$ 210,363$ 643,862$ 2,736,467$
Investments - 1,000,000 250,000 1,750,000 3,000,000
Receivables, net 1,121 695,235 460 86,633 783,449
Inventories 65,675 - - - 65,675
Total current assets 69,141 3,575,132 460,823 2,480,495 6,585,591
Noncurrent Assets:
Net depreciable capital assets 32,117 4,004,542 - - 4,036,659
Total assets 101,258 7,579,674 460,823 2,480,495 10,622,250
Deferred Outflows of Resources:
Deferred pension related outflows 129,127 - - - 129,127
Current Liabilities:
Voucher and accounts payable 12,752 - 9,088 100,772 122,612
Accrued payroll and payroll taxes 10,160 - - - 10,160
Accrued compensated absences 28,523 - - - 28,523
Deferred revenue - - - 22,152 22,152
Total current liabilities 51,435 - 9,088 122,924 183,447
Noncurrent Liabilities:
Pensions obligation 530,995 - - - 530,995
Accrued compensated absences 11,093 - - - 11,093
Total noncurrent liabilities 542,088 - - - 542,088
Total liabilities 593,523 - 9,088 122,924 725,535
Deferred Inflows of Resources
Deferred pension related inflows 15,905 - - - 15,905
Net invested in capital assets 32,117 4,004,542 - - 4,036,659
Unrestricted (411,160) 3,575,132 451,735 2,357,571 5,973,278
TOTAL NET POSITION (379,043)$ 7,579,674$ 451,735$ 2,357,571$ 10,009,937$
See auditors report on pages 11-12.
-116-
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
JUNE 30, 2017
LIABILITIES
ASSETS
NET POSITION
Fleet
Maintenance
Exhibit D-2
Health
Fleet Lease Insurance Insurance Combined
Trust Fund Fund Total
Operating Revenues:
Charges for services - internal 422,004$ 905,200$ 1,174,263$ 3,264,344$ 5,765,811$
Charges for services - external - - - 279,008 279,008
Total operating revenues 422,004 905,200 1,174,263 3,543,352 6,044,819
Operating Expenses:
Vehicle maintenance 567,212 6,499 - - 573,711
Administrative - 48,518 - 535,190 583,708
Insurance premium, claims and medical - - 1,154,138 2,474,458 3,628,596
Depreciation 5,623 873,339 - - 878,962
Total operating expenses 572,835 928,356 1,154,138 3,009,648 5,664,977
Operating income (loss)(150,831) (23,156) 20,125 533,704 379,842
Nonoperating Revenues and (Expenses):
Interest and investment income 9 39,742 460 3,807 44,018
Gain (loss) on disposal of property
and equipment 14,267 70,148 - - 84,415
Total nonoperating revenues
(expenses)14,276 109,890 460 3,807 128,433
Income (loss) before transfers (136,555) 86,734 20,585 537,511 508,275
Contributions and Transfers:
Transfers in 164,276 - 35,411 - 199,687
Transfers out - - - - -
Total contributions and operating transfers 164,276 - 35,411 - 199,687
Change in net position 27,721 86,734 55,996 537,511 707,962
Net position - beginning (406,764) 7,492,940 395,739 1,820,060 9,301,975
Net position - ending (379,043)$ 7,579,674$ 451,735$ 2,357,571$ 10,009,937$
See auditors report on pages 11-12.
-117-
Fleet
Maintenance
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF REVENUES, EXPENSES,
AND CHANGES IN NET POSITION
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2017
Exhibit D-3
Health
Fleet Lease Insurance Insurance Combined
Cash Flows from Operating Activities: Trust Fund Fund Total
Receipts from other funds for services 420,883$ 610,040$ 1,174,444$ 3,498,775$ 5,704,142$
Payments to suppliers (260,624) - - - (260,624)
Payments to employees (329,440) - - - (329,440)
Insurance premium, claims and medical - - (1,156,222) (2,576,052) (3,732,274)
Other payments - (55,846) - (535,189) (591,035)
Net cash provided (used) by operating activities (169,181) 554,194 18,222 387,534 790,769
Cash Flows from Noncapital Financing
Activities:
Transfers from other funds 164,276 - 35,411 - 199,687
Transfers to other funds - - - - -
Net cash provided (used) by noncapital
financing activities 164,276 - 35,411 - 199,687
Cash Flows from Capital and Related
Financing Activities:
Proceeds from sale of capital assets 14,266 87,988 - - 102,254
Purchase of capital assets (7,328) (1,041,823) - - (1,049,151)
Net cash used by capital and related financing 6,938 (953,835) - - (946,897)
Cash Flows from Investing Activities:
Interest and dividends 9 39,742 460 3,807 44,018
Purchase of investments - (1,000,000) (250,000) (1,750,000) (3,000,000)
Net cash used by investing activities 9 (960,258) (249,540) (1,746,193) (2,955,982)
Net increase (decrease) in cash
and cash equivalents 2,042 (1,359,899) (195,907) (1,358,659) (2,912,423)
Cash and cash equivalents, July 1, 2016 303 3,239,796 406,270 2,002,521 5,648,890
CASH AND CASH EQUIVALENTS,
JUNE 30, 2017 2,345$ 1,879,897$ 210,363$ 643,862$ 2,736,467$
Reconciliation of Operating Income (Loss) to
Net Cash Provided by Operating Activities:
Operating income (loss)(150,831)$ (23,156)$ 20,125$ 533,704$ 379,842$
Adjustments to reconcile operating
income (loss) to net cash provided
(used) by operating activities:
Depreciation and amortization 5,623 873,339 - - 878,962
Change in assets and liabilities:
Receivables (1,121) (495,160) 181 (42,864) (538,964)
Inventories (9,559) - - - (9,559)
Due form other funds - 200,000 - - 200,000
Pension obligation and related deferrals 19,586 - - - 19,586
Accounts payable and accrued expenses (32,879) (829) (2,084) (103,306) (139,098)
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES (169,181)$ 554,194$ 18,222$ 387,534$ 790,769$
See auditors report on pages 11-12.
-118-
Fleet
Maintenance
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2017
FIDUCIARY FUNDS
Exhibit E-1
Cemetery
and
Park
Trusts
Cash and cash equivalents 112,032$
Investments at fair value
Money market funds -
Mutual funds 1,070,929
Total assets 1,182,961
Accounts payable -
Held in trust for other purposes 1,182,961$
See auditors report on pages 11-12.
-119-
ASSETS
LIABILITIES
NET POSITION
JUNE 30, 2017
FIDUCIARY FUNDS - PRIVATE-PURPOSE TRUST FUNDS
STATEMENT OF NET POSITION
CITY OF PADUCAH, KENTUCKY
Exhibit E-2
Cemetery
and
Park
Additions:Trusts
Contributions:
Intergovernmental revenues -$
Private donations 3,860
Total contributions 3,860
Investment earnings:
Change in fair value of investments 58,149
Interest and dividends 69,102
Net investment earnings 127,251
Total additions 131,111
Deductions:
Capital outlay 41,578
Administrative expenses 13,342
Total deductions 54,920
Change in net position 76,191
Net position - beginning 1,106,770
Net position - ending 1,182,961$
See auditors report on pages 11-12.
STATEMENT OF CHANGES IN NET POSITION
CITY OF PADUCAH, KENTUCKY
-120-
FOR THE YEAR ENDED JUNE 30, 2017
FIDUCIARY FUNDS - PRIVATE-PURPOSE TRUST FUNDS
Exhibit E-3
Payroll Fund: Additions Deductions
Assets:
Cash and cash equivalents 519,942$ 13,702,123$ 13,339,536$ 882,529$
Liabilities:
Payroll taxes and withholdings
payable 519,942$ 13,702,123$ 13,339,536$ 882,529$
See auditors report on pages 11-12.
CITY OF PADUCAH, KENTUCKY
AGENCY FUND
IN ASSETS AND LIABILITIES
STATEMENT OF CHANGES
-121-
FOR THE YEAR ENDED JUNE 30, 2017
Balance Balance
July 1, 2016 June 30, 2017
STATISTICAL SECTION
Contents Page
Financial Trends 122-126
Revenue Capacity 127-132
Debt Capacity 133-136
Economic and Demographic Information 137-139
Operating Information 139-141
These schedules offer economic and demographic indicators to help the reader understand
the environment within which the City's financial activities take place.
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 ending June 30, 2003. Schedules presenting government-
wide information include information beginning in that year.
This part of the City of Paducah's comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial
statements, note disclosures, and required supplementary information say about the City's
overall financial health.
These schedules contain trend information to help the reader understand how the City's
financial performance and well-being changed over time.
These schedules contain information to help the reader assess the factors affecting the
City's ability to generate its property and employee taxes.
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.
20172016 2015 (1) 20142013201220112010 (2)20092008Governmental activities:Net Invested in Capital Assets52,898,618$ 46,389,685$ 39,349,789$ 39,844,772$ 33,365,112$ 31,957,381$ 32,905,977$ 31,136,514$ 31,215,252$ 31,766,783$ Restricted for:Program purposes131,055 147,218 144,857 205,979 284,760 897,942 1,264,986 1,100,696 2,183,559 1,782,251 Capital projects2,137,650 1,148,789 2,427,218 2,168,201 1,301,421 4,105,639 5,987,399 5,077,026 4,363,913 5,028,420 Unrestricted(17,834,152) (23,323,077) (22,209,537) 13,382,066 13,539,204 5,913,997 4,229,501 8,165,101 8,621,077 9,432,763 Total governmental activities net position 37,333,171$ 24,362,615$ 19,712,327$ 55,601,018$ 48,490,497$ 42,874,959$ 44,387,863$ 45,479,337$ 46,383,801$ 48,010,217$ Business-type activities:Net Invested in Capital Assets2,152,827 1,678,728 1,133,226 1,210,415 1,232,735 1,308,574 1,334,230 1,652,961 1,721,419 1,863,975 Restricted for:Program purposes- 38,247 124,012 437,483 385,885 732,817 999,885 620,800 369,368 579,460 Unrestricted1,513,281 3,194,228 3,033,822 3,837,034 3,428,267 3,246,320 3,004,783 1,816,705 1,036,093 (19,965) Total business-type activities net postion 3,666,108$ 4,911,203$ 4,291,060$ 5,484,932$ 5,046,887$ 5,287,711$ 5,338,898$ 4,090,466$ 3,126,880$ 2,423,470$ Primary government:Net Invested in Capital Assets55,051,445 48,068,413 40,483,015 41,055,187 34,597,847 33,265,955 34,240,207 32,789,475 32,936,671 33,630,758 Restricted for:Program purposes131,055 185,465 268,869 643,462 670,645 1,630,759 2,264,871 1,721,496 2,552,927 2,361,711 Capital projects2,137,650 1,148,789 2,427,218 2,168,201 1,301,421 4,105,639 5,987,399 5,077,026 4,363,913 5,028,420 Unrestricted(16,320,871) (20,128,849) (19,175,715) 17,219,100 16,967,471 9,160,317 7,234,284 9,981,806 9,657,170 9,412,798 Total primary government net position 40,999,279$ 29,273,818$ 24,003,387$ 61,085,950$ 53,537,384$ 48,162,670$ 49,726,761$ 49,569,803$ 49,510,681$ 50,433,687$ (1)Significant change in governmental and business-type net position due to implementation of GASB No. 68 - Accounting and Financial Reporting for Pensions. (2) Significant change in governmental net position due to reclassification for prior year grant receivables. Fiscal YearTABLE 1CITY OF PADUCAH, KENTUCKYNET POSITION BY COMPONENTLast Ten Fiscal Years (accrual basis of accounting)-122-
Pages 1 of 22017 2016 2015 (1) 2014 2013 2012 2011 2010 (3) 2009 2008 (2)ExpensesGovernmental activities:General government 8,652,987$ 9,777,876$ 9,801,489$ 8,005,619$ 7,843,140$ 12,937,997$ 9,786,052$ 9,763,178$ 12,148,118$ 10,709,641$ Public safety 20,176,070 20,503,784 17,974,548 18,439,670 18,204,945 17,045,731 16,993,228 16,239,042 15,734,557 15,938,831 Public service 7,771,335 10,266,856 6,855,234 6,982,536 6,167,510 6,163,602 7,328,806 7,669,729 12,849,566 9,543,714 Parks and recreation 3,059,447 3,052,360 2,811,533 2,750,531 2,710,659 2,654,098 2,748,333 2,653,474 1,492,306 1,286,955 Planning and development 1,077,265 911,830 1,000,020 1,805,379 1,463,659 1,192,952 1,212,103 970,022 708,827 282,042 Interest on long-term debt 885,380 900,593 850,827 1,084,016 1,066,876 1,059,537 1,363,580 1,099,450 1,029,888 1,066,067 Total governmental activities expenses41,622,484 45,413,299 39,293,651 39,067,751 37,456,789 41,053,917 39,432,102 38,394,895 43,963,262 38,827,250 Business-type activities:Solid Waste3,902,907 3,815,476 3,843,081 3,985,233 3,967,490 3,900,264 3,832,130 3,797,097 4,037,845 4,086,747 Section Eight Housing1,952,441 1,874,074 1,819,328 1,855,869 2,032,843 1,921,004 1,956,728 2,061,370 2,154,360 1,949,899 Civic Center92,471 74,457 98,318 81,982 78,000 71,069 76,546 69,537 75,692 84,908 Transit Boat Dock1,031 - - - - - - - - - TISA- - - - - 173,708 183,546 206,798 162,848 156,388 Total business-type activities expenses5,948,850 5,764,007 5,760,727 5,923,084 6,078,333 6,066,045 6,048,950 6,134,802 6,430,745 6,277,942 Total primary government expenses47,571,334$ 51,177,306$ 45,054,378$ 44,990,835$ 43,535,122$ 47,119,962$ 45,481,052$ 44,529,697$ 50,394,007$ 45,105,192$ Program RevenuesGovernmental activities:Charges for services:General government 1,650,034$ 1,128,785$ 185,745$ 1,672,552$ 1,525,212$ 1,488,845$ 1,051,509$ 993,371$ 1,303,667$ 1,415,943$ Public safety340,705 237,641 237,222 264,143 354,829 509,297 790,650 484,754 602,262 268,839 Public service967,518 1,065,010 945,471 960,271 963,893 1,032,953 1,205,666 1,197,194 1,220,999 1,111,188 Parks and recreation121,929 132,909 108,307 105,248 106,183 97,896 129,790 152,890 180,420 124,606 Planning and development- - - - - - - - 1,600 30,627 Operating grants and contributions7,509,005 6,179,709 3,360,731 5,419,715 3,067,581 2,215,247 2,086,625 1,813,019 2,119,845 1,340,261 Capital grants and contributions3,702,428 4,139,036 899,522 4,136,749 2,165,548 533,169 1,767,093 1,390,848 4,889,520 1,297,900 Total governmental activities program revenues 14,291,619 12,883,090 5,736,998 12,558,678 8,183,246 5,877,407 7,031,333 6,032,076 10,318,313 5,589,364 Business-type activities:Solid Waste4,567,392$ 4,520,084$ 4,453,865$ 4,410,059$ 4,372,060$ 4,437,341$ 4,476,139$ 4,436,540$ 4,547,959$ 4,165,094$ Section Eight Housing- - - - - - - - - - Civic Center36,725 40,148 43,486 41,266 38,265 34,038 33,766 32,455 38,577 32,932 TISA- - - - - 99,603 138,797 148,158 148,291 143,833 Operating grants and contributions1,962,125 1,845,549 1,744,364 1,956,995 1,727,238 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 Total business-type activities program revenues 6,566,242 6,405,781 6,241,715 6,408,320 6,137,563 6,234,229 7,057,901 6,984,659 6,829,795 6,137,148 Total primary government program revenues 20,857,861$ 19,288,871$ 11,978,713$ 18,966,998$ 14,320,809$ 12,111,636$ 14,089,234$ 13,016,735$ 17,148,108$ 11,726,512$ Fiscal Year-123-TABLE 2CITY OF PADUCAH, KENTUCKYCHANGES IN NET POSITIONLast Ten Fiscal Years (accrual basis of accounting)
Pages 2 of 22017 2016 2015 (1) 2014 2013 2012 2011 2010 (3) 2009 2008 (2)Net (Expense)/RevenueGovernmental activities(27,330,865)$ (32,530,209)$ (33,556,653)$ (26,509,073)$ (29,273,543)$ (35,176,510)$ (32,400,769)$ (32,362,819)$ (33,644,949)$ (33,237,886)$ Business-type activities617,392 641,774 480,988 485,236 59,230 168,184 1,008,951 849,857 399,050 (140,794) Total primary government net (expense) (26,713,473)$ (31,888,435)$ (33,075,665)$ (26,023,837)$ (29,214,313)$ (35,008,326)$ (31,391,818)$ (31,512,962)$ (33,245,899)$ (33,378,680)$ General Revenues and Other Changesin Net PositionGovernmental activities:Taxes and licenses:Property taxes, levied for general purpose4,996,242 4,943,962 4,726,244 4,622,292 4,502,276 4,267,812 4,402,226 4,207,736 3,986,760$ 4,221,957 Insurance premium tax4,331,956 4,170,381 3,786,514 3,831,792 3,863,464 3,690,806 3,476,309 3,797,347 4,055,228 4,699,458 Gross receipts license tax4,721,657 4,711,708 4,397,888 4,444,440 4,391,352 4,359,835 4,243,511 4,229,102 4,320,850 4,061,587 Employee license tax20,803,763 20,130,249 19,092,912 18,114,396 18,336,124 18,095,182 17,345,033 16,384,509 16,584,636 16,520,523 Other taxes2,933,407 2,759,902 2,964,685 2,785,333 2,799,043 2,711,924 2,712,817 2,844,154 2,776,407 2,259,956 Intergovernmental revenue- - - - - - - - - 1,401,400 Unrestricted investment earnings188,097 137,224 176,229 232,204 211,306 203,261 264,913 172,213 336,960 540,620 Miscellaneous51,922 189,489 16,870 (482,137) 300,378 36,718 62,539 64,620 68,530 119,200 Insurance recoveries- - - - - 27,448 410,462 - - - Litigation settlement- - - - - - (1,482,743) - - - Transfers in/out2,274,377 137,582 194,014 212,128 485,138 270,620 (125,772) (78,893) (110,838) (96,609) Total governmental activities40,301,421 37,180,497 35,355,356 33,760,448 34,889,081 33,663,606 31,309,295 31,620,788 32,018,533 33,728,092 Business-type activities:Unrestricted investment earnings37,644 30,302 39,565 48,255 49,382 48,806 46,052 33,724 52,961 73,985 Miscellaneous374,244 85,649 8,339 116,682 135,702 2,443 67,657 1,112 98,369 127,131 Transfers(2,274,377) (137,582) (194,014) (212,128) (485,138) (270,620) 125,772 78,893 110,838 96,609 Total business-type activities(1,862,489) (21,631) (146,110) (47,191) (300,054) (219,371) 239,481 113,729 262,168 297,725 Change in Net PositionGovernmental activities:12,970,556 4,650,288 1,798,703 7,251,375 5,615,538 (1,512,904) (1,091,474) (742,031) (1,626,416) 490,206 Business-type activities:(1,245,097) 620,143 334,878 438,045 (240,824) (51,187) 1,248,432 963,586 661,218 156,931 Total primary government 11,725,459$ 5,270,431$ 2,133,581$ 7,689,420$ 5,374,714$ (1,564,091)$ 156,958$ 221,555$ (965,198)$ 647,137$ (1) Significant change in governmental and business-type net position due to implementation of GASB No. 68 - Accounting and Financial Reporting for Pensions. (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 position due to restatement of prior year grant receivables.(accrual basis of accounting)CHANGES IN NET POSITION-124-Fiscal YearCITY OF PADUCAH, KENTUCKYLast Ten Fiscal Years TABLE 2
2017201620152014201320122011 2010 (2) 2009 2008 (1)General FundUnassigned15,330,645$ 13,198,126$ 12,549,232$ 12,694,610$ 12,311,565$ 11,321,438$ 10,940,121$ 10,208,678$ 10,311,490$ 9,416,427$ Total general fund15,330,645$ 13,198,126$ 12,549,232$ 12,694,610$ 12,311,565$ 11,321,438$ 10,940,121$ 10,208,678$ 10,311,490$ 9,416,427$ All Other Governmental FundsNonspendable:Inventory525,732$ 623,735$ 828,419$ 1,497,659$ 1,336,234$ 1,098,304$ 1,253,953$ 1,416,130$ 2,019,630$ 1,208,749$ Restricted for:Program purposes736,461 1,296,007 1,303,030 205,979 284,760 1,236,780 - - - - Capital improvements1,532,244 - 1,269,045 2,168,201 1,301,421 286,276 - - - - Committed for:Capital improvements2,387,922 2,018,581 1,814,834 1,758,934 2,589,099 2,631,233 2,587,012 2,844,706 2,618,147 2,081,280 Assigned for:Program purposes1,325,941 1,049,802 951,296 802,692 752,691 472,235 683,578 1,402,731 1,634,547 1,193,968 Capital improvements7,429,412 5,179,330 4,665,475 3,206,412 3,055,250 1,487,938 2,133,786 5,151,791 1,745,766 2,947,140 Total all other governmental funds 13,937,712$ 10,167,455$ 10,832,099$ 9,639,877$ 9,319,455$ 7,212,766$ 6,658,329$ 10,815,358$ 8,018,090$ 7,431,137$ (1) Significant decrease in reserve for program purpose due to converting governmental fund to proprietary fund.(2) Significant decrease in general fund balance due to restatement of prior year grant receivables-125-Fiscal YearTABLE 3CITY OF PADUCAH, KENTUCKYFund Balances, Governmental FundsLast Ten Fiscal Years (modified accrual basis of accounting)
2017201620152014201320122011201020092008Revenues:Taxes7,310,257$ 6,976,933$ 6,987,173$ 6,713,889$ 6,583,690$ 6,343,608$ 6,223,511$ 6,326,740$ 5,867,782$ 6,139,164$ Licenses30,360,825 29,606,552 27,804,759 26,987,110 27,197,290 26,753,432 25,704,849 24,979,768 25,411,112 25,924,562 Charges for services964,766 884,259 848,971 851,080 815,791 817,607 811,590 846,087 866,688 835,105 Intergovernmental1,140,622 1,132,852 1,244,417 2,624,363 1,240,312 1,191,835 1,148,362 1,091,324 1,086,377 1,565,348 Grants6,476,765 8,892,529 2,496,329 5,923,651 3,737,402 1,699,399 2,992,519 2,062,554 5,405,810 1,673,936 Interest144,079 115,922 148,411 199,583 175,371 162,580 205,837 121,246 225,251 419,103 Other2,389,230 2,085,412 2,408,193 3,271,860 2,743,698 1,902,075 1,790,890 2,653,382 2,250,344 1,944,310 Total revenues48,786,544 49,694,459 41,938,253 46,571,536 42,493,554 38,870,536 38,877,558 38,081,101 41,113,364 38,501,528 Expenditures:General government4,881,298 4,526,828 4,484,105 4,311,103 4,481,485 5,117,194 5,151,370 5,277,916 4,726,435 5,051,374 Public safety18,923,070 18,435,365 18,524,763 18,475,471 18,174,349 18,479,428 16,854,136 15,999,437 15,599,613 15,696,728 Public service6,515,997 6,106,773 6,165,664 6,323,481 5,710,018 5,596,702 6,446,503 5,984,115 7,855,846 7,935,188 Parks and recreation3,012,236 2,929,404 2,842,460 2,602,348 2,426,234 2,677,781 2,781,663 2,582,382 1,490,732 1,298,329 Planning and development936,855 910,379 950,297 2,086,527 1,776,897 2,372,314 1,842,474 2,471,869 1,000,202 481,523 Other393,812 441,742 247,878 640,452 766,847 516,534 486,239 847,188 514,488 520,611 Capital outlay10,287,203 13,305,919 4,708,663 11,926,435 4,324,821 2,104,993 5,121,682 8,324,312 8,580,910 4,826,983 Debt service:Principal requirement2,244,361 2,137,759 2,158,385 1,748,233 1,698,468 1,434,246 2,233,588 1,020,585 830,682 880,887 Debt issuance costs- - 51,461 109,292 - - - - - - Interest and fiscal requirement810,917 845,609 817,191 1,086,866 1,089,447 1,114,852 1,519,329 1,077,128 1,003,439 1,051,008 Total expenditures48,005,749 49,639,778 40,950,867 49,310,208 40,448,566 39,414,044 42,436,984 43,584,932 41,602,347 37,742,631 Other Financing Sources (Uses):Bonds issued- - 4,225,000 9,055,000 - - - 6,645,000 1,718,605 - Payment to bond escrow agent- - (4,143,964) (5,627,447) - - - - - - Premium on debt issued- - - 220,683 - - - - - - Discount on debt issued- - (29,576) (53,529) - - - - - - Long-term debt draws/issued3,000,000 - - - 308,112 101,983 366,039 1,480,781 69,032 - Capital lease- - - - 405,796 405,796 405,796 405,796 405,796 371,979 Transfers in10,377,609 10,034,851 7,785,410 9,148,761 7,462,944 5,888,847 8,455,433 9,722,852 5,928,413 6,241,886 Transfers out(8,255,627) (10,105,282) (7,780,785) (9,199,119) (7,125,024) (5,809,539) (8,201,253) (9,893,709) (6,150,847) (7,086,517) Total other financing sources (uses)5,121,982 (70,431) 56,085 3,544,349 1,051,828 587,087 1,026,015 8,360,720 1,970,999 (472,652) Net change in fund balances5,902,777$ (15,750)$ 1,043,471$ 805,677$ 3,096,816$ 43,579$ (2,533,411)$ 2,856,889$ 1,482,016$ 286,245$ Capital outlay (1)8,180,134$ 9,718,561$ 1,481,948$ 10,843,726$ 4,034,424$ 2,156,290$ 4,833,547$ 8,763,073$ 2,850,717$ 2,857,189$ Debt service as a percentageof noncapital expenditures7.67%7.47%7.54%7.37%7.66%6.84%9.98%6.02%4.73%5.54%(1) Capital outlay is reported on the Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities.-126-Fiscal Year(modified accrual basis of accounting)TABLE 4CITY OF PADUCAH, KENTUCKYChanges in Fund Balances, Governmental FundsLast Ten Fiscal Years
TotalEstimated DirectFiscalPersonalActual Tax Year Commercial Residential Property FranchiseTotalValue RateExemptions2008 748,189,877 603,688,455 481,049,523 74,068,797 1,906,996,652 1,970,156,891 0.287 96.8% 63,160,239 2009 776,876,510 645,672,462 526,966,182 56,333,800 2,005,848,954 2,069,450,607 0.288 96.9% 63,601,653 2010 797,902,456 659,381,375 495,273,730 57,459,000 2,010,016,561 2,076,961,686 0.286 96.8% 66,945,125 2011 780,357,859 670,841,459 536,894,082 46,722,282 2,034,815,682 2,103,120,249 0.288 96.8% 68,304,567 2012 781,685,815 685,984,380 524,400,400 48,227,212 2,040,297,807 2,108,802,723 0.287 96.8% 68,504,916 2013 787,762,105 731,842,861 564,154,697 60,279,730 2,144,039,393 2,214,978,356 0.288 96.8% 70,938,963 2014 826,805,152 743,249,074 585,142,381 41,487,586 2,196,684,193 2,270,597,754 0.292 96.7% 73,913,561 2015 851,731,625 751,761,832 582,368,709 73,944,847 2,259,807,013 2,333,746,718 0.291 96.8% 73,939,705 2016 902,687,182 783,886,570 573,896,954 57,561,993 2,318,032,699 2,394,834,871 0.289 96.8% 76,802,172 2017 900,210,589 802,111,012 603,335,847 66,110,416 2,371,767,864 2,447,929,006 0.290 96.9% 76,161,142 Source: McCracken County Property Valuation AdministratorNotes: Property in McCracken county is reassessed once every four years on average.-127-TABLE 5CITY OF PADUCAH, KENTUCKYASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTYLAST TEN FISCAL YEARSEstimatedValuePercentAssessedToAssessed ValueReal Estate
TotalFiscal RealDirect RealRealRealRealYear Estate Personal Rate Estate Personal Estate Personal Estate Personal Estate Personal2008 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 0.018 0.018 0.096 0.106 2010 0.250 0.390 0.286 0.504 0.504 0.678 0.678 0.018 0.018 0.095 0.095 2011 0.250 0.390 0.288 0.504 0.504 0.711 0.711 0.018 0.018 0.095 0.098 2012 0.250 0.390 0.287 0.504 0.504 0.747 0.747 0.018 0.018 0.098 0.119 2013 0.250 0.390 0.288 0.504 0.504 0.747 0.747 0.017 0.017 0.096 0.102 2014 0.255 0.390 0.292 0.504 0.504 0.767 0.767 0.017 0.017 0.095 0.101 2015 0.255 0.390 0.291 0.495 0.495 0.771 0.771 0.017 0.017 0.094 0.095 2016 0.255 0.390 0.289 0.524 0.524 0.800 0.800 0.017 0.017 0.098 0.102 2017 0.255 0.390 0.290 0.516 0.516 0.799 0.799 0.017 0.017 0.096 0.098 Source: McCracken County Property Valuation Administrator and City Tax Levy Ordinance.General FundCity Direct RatesMcCracken Co.City of Paducah-128-McCracken PaducahSchool DistrictsSchool DistrictsJunior CollegeCountyTABLE 6CITY OF PADUCAH, KENTUCKYPROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS(PER $100 OF ASSESSED VALUE)LAST TEN FISCAL YEARS
(1)(2)
(1)(2)
Assessed Assessed
Taxpayer Valuation Valuation
Kentucky Oaks Mall 50,900,262$ 2.15%50,900,262$ 2.88%
Paducah Medical Investors 13,440,090 0.57%13,440,090 0.76%
Ducmall LLC 13,119,800 0.55%14,374,800 0.81%
Woodstone Enterprises LP 12,429,000 0.52%
Wal Mart Real Estate Business 10,646,400 0.45%10,646,400 0.60%
Superior Care Homes Properties 10,000,000 0.42%
Paducah Hospitality Partners 9,600,000 0.40%
Sams Real Estate Business Trust 9,222,955 0.39%9,222,955 0.52%
Computer Service Inc 9,083,185 0.38%9,083,185 0.51%
Wal Mart Store 9,000,000 0.38%9,000,000 0.51%
Olivet Church 1031 LLC 15,493,200 0.88%
Lourdes Medical Pavilion 15,982,400 0.90%
TOTALS 147,441,692$ 6.23%148,143,292$ 8.37%
(1) Source - Property Valuation Administration; Assessed value as of January 1, 2016.
(2) Source - Property Valuation Administration; Assessed value as of January 1, 2007.
-129-
Percentage of Percentage of
Total Assessed Total Assessed
Valuation Valuation
TABLE 7
CITY OF PADUCAH, KENTUCKY
PRINCIPAL TAXPAYERS - PROPERTY TAX
CURRENT YEAR AND NINE YEARS PRIOR
2017 2008
Total Collections to Date
(1)
(1) Percent of Percent of
Amount of Levy Total Levy
Collections Collected Collections Collected
3,969,753 3,814,940 96.1% 150,346 3,965,286 99.9%
4,195,148 4,017,032 95.8% 168,645 4,185,677 99.8%
4,251,473 4,131,454 97.2% 108,778 4,240,232 99.7%
4,190,003 4,110,973 98.1% 67,082 4,178,055 99.7%
4,219,111 4,119,689 97.6% 87,461 4,207,150 99.7%
4,432,408 4,334,698 97.8% 83,529 4,418,227 99.7%
4,599,099 4,509,874 98.1% 71,039 4,580,913 99.6%
4,722,507 4,644,522 98.3% 54,642 4,699,164 99.5%
4,880,275 4,802,067 98.4% 41,768 4,843,835 99.3%
4,988,651 4,888,303 98.0%- 4,888,303 98.0%
(1) Includes current year real and personal property tax.
* Source - City of Paducah Finance Department.
2017
2013
-130-
2008
2009
2010
2016
2014
2015
2011
2012
TABLE 8
CITY OF PADUCAH, KENTUCKY
SECURED TAX LEVIES AND COLLECTIONS*
LAST TEN FISCAL YEARS
June 30,
Ended
Year
Fiscal Year
Collections
in Subsequent
Years
Collected within the
Fiscal Year of the Levy
Taxes Levied
Fiscal
for the
(1)Direct
Fiscal Taxes Tax
Year Collected Rate
2008 16,535,542 2.00%
2009 16,584,618 2.00%
2010 16,384,509 2.00%
2011 17,345,034 2.00%
2012 18,095,182 2.00%
2013 18,336,124 2.00%
2014 18,114,396 2.00%
2015 19,092,911 2.00%
2016 20,130,158 2.00%
2017 20,803,763 2.00%
181,422,237
(1) Source - City of Paducah Finance Department - Actual collections during the fiscal year.
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TABLE 9
CITY OF PADUCAH, KENTUCKY
EMPLOYEE LICENSE TAX COLLECTIONS
LAST TEN FISCAL YEARS
(1) Percentage of
Number of Percentage Taxes Total Employee
Filers of Total Collected License Tax
$0 - $50,000 2,504 97.62% 9,224,311 44.34%
$50,001 - $100,000 33 1.29% 2,394,902 11.51%
$100,001 - $500,000 25 0.97% 5,099,294 24.51%
Greater than $500,000 3 0.12% 4,085,256 19.64%
TOTALS 2,565 100.00% 20,803,763$ 100.00%
(1) Percentage of
Number of Percentage Taxes Total Employee
Filers of Total Collected License Tax
$0 - $50,000 2,052 97.81% 8,707,672 52.66%
$50,001 - $100,000 27 1.29% 1,791,822 10.84%
$100,001 - $500,000 17 0.81% 3,595,858 21.75%
Greater than $500,000 2 0.10% 2,440,190 14.76%
TOTALS 2,098 100.00% 16,535,542$ 100.00%
(1) Source - City of Paducah Finance Department - Actual collections during the fiscal year.
-132-
Taxpayers
By Range
Taxpayers
By Range
2017
2008
TABLE 10
CITY OF PADUCAH, KENTUCKY
PRINCIPAL EMPLOYEE LICENSE TAXPAYERS
CURRENT YEAR AND NINE YEARS PRIOR
(1)Ratio of (3)Reported Net Net Net Debt as (2)General Refunding Total Debt to Percentage NetFiscal Obligation Capital Revenue Primary Actual of Personal Debt PerYear Bonds Lease Bonds Government Value Income Capita2008 17,680,000 2,946,303 - - - 20,626,303 1.05 4.26% 784 2009 19,799,638 5,187,262 - - - 24,986,900 1.21 5.16% 950 2010 25,661,440 5,808,267 - - - 31,469,707 1.52 6.50% 1,196 2011 24,879,948 4,910,742 - - - 29,790,690 1.42 5.92% 1,190 2012 23,651,493 7,320,328 - - - 30,971,821 1.47 6.16% 1,238 2013 22,361,906 6,920,838 - - - 29,282,744 1.32 5.82% 1,170 2014 24,706,291 6,519,356 - - - 31,225,647 1.38 6.21% 1,248 2015 23,320,347 6,101,064 - - - 29,421,411 1.26 5.85% 1,176 2016 21,595,096 5,686,435 - - - 27,281,531 1.14 5.42% 1,090 2017 19,815,809 8,218,304 - - - 28,034,113 1.15 5.57% 1,120 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 16 for population data.(3) See Table 16 for personal income dataTABLE 11CITY OF PADUCAH, KENTUCKYRATIO OF OUTSTANDING DEBT BY TYPELAST TEN FISCAL YEARSPublic-133-ImprovementDebtNetPublicDebtImprovement
(1)Ratio ofPublicNetConvention & Rental Floodwall ImprovementPublic PoolEconomicBonds toFiscal Art CenterBuildingRehabilitation ProjectRenovation DevelopmentActualYear Bonds Bonds Bonds Bonds Bonds Bonds Total Value2008 7,600,000 5,740,000 4,340,000 - - - - 17,680,000 0.90 672 2009 7,320,000 5,545,000 4,160,000 2,774,638 - - - 19,799,638 0.96 753 2010 7,030,000 5,340,000 3,975,000 2,671,440 6,645,000 - - 25,661,440 1.24 975 2011 7,040,000 5,125,000 3,780,000 2,564,948 6,370,000 - - 24,879,948 1.18 994 2012 6,630,000 4,895,000 3,630,000 2,455,210 6,100,000 - - (58,717) 23,651,493 1.12 945 2013 6,220,000 4,655,000 3,370,000 2,341,790 5,825,000 - - (49,884) 22,361,906 1.01 894 2014 5,805,000 4,400,000 3,100,000 2,224,863 5,460,000 1,120,000 2,475,000 121,428 24,706,291 1.09 987 2015 5,385,000 4,435,000 2,820,000 2,104,212 5,100,000 1,055,000 2,330,000 91,135 23,320,347 1.00 932 2016 4,955,000 4,055,000 2,530,000 1,990,271 4,805,000 990,000 2,185,000 84,825 21,595,096 0.90 863 2017 4,515,000 3,660,000 2,230,000 1,862,123 4,505,000 925,000 2,040,000 78,686 19,815,809 0.81 792 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 yea(2) See Table 16 for population data.TABLE 12CITY OF PADUCAH, KENTUCKYRATIO OF NET GENERAL BONDED DEBT OUTSTANDINGLAST TEN FISCAL YEARSPolice andFire PensionFundBonds-134-CapitaAmortizationof Discountsand Premiums(2)NetBonds Per
Estimated
(1) Share of
Reported Percentage Direct and
Debt Applicable Overlapping
Outstanding to the City Debt
City of Paducah 28,034,113$ 100.00% 28,034,113$
Paducah Independent School District 46,038,900 * 100.00% 46,038,900
McCracken County 17,459,381 * 45.70% 7,978,937
McCracken County Board of Education 60,116,953 * 31.80% 19,117,191
Overlapping debt 123,615,234 73,135,028
TOTAL DIRECT AND OVERLAPPING DEBT 151,649,347$ 101,169,141$
(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.
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TABLE 13
CITY OF PADUCAH, KENTUCKY
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
AS OF JUNE 30, 2017
Net assessed value2,371,767,864$ Add exemption76,161,142 Total assessed value2,447,929,006$ Debt limit - 10% of total assessed (1)244,792,901$ Debt outstanding:General obligation bonds outstanding19,815,809$ Note payable8,218,304 Less debt not subject to limit- Gross bonded debt28,034,113 Less amount available in debt servicefunds1,022,907 Net bonded indebtedness subject tolimit27,011,206 LEGAL DEBT MARGIN217,781,695$ 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008Debt limit 244,792,901$ 239,483,487$ 233,374,672$ 227,059,775$ 221,497,836$ 212,207,634$ 210,312,025$ 207,696,169$ 206,945,061$ 197,015,689$ Total net debt applicable to limit 27,011,206 26,489,770 28,769,092 30,721,830 28,966,286 30,936,733 29,716,418 31,377,263 24,893,656 20,561,255 LEGAL DEBTMARGIN217,781,695$ 212,993,717$ 204,605,580$ 196,337,945$ 192,531,550$ 181,270,901$ 180,595,607$ 176,318,906$ 182,051,405$ 176,454,434$ Total net debtapplicable to thelimited as a percentage ofdebt limit11.03% 11.06% 12.33% 13.08% 14.58% 14.13% 15.11% 12.03% 10.44%11.82%(1) "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."-136-Fiscal YearTABLE 14CITY OF PADUCAH, KENTUCKYLEGAL DEBT MARGIN INFORMATIONLAST TEN FISCAL YEARS
(1)(1)
Personal
Income
26,307 484,469,019 18,417 39.9 2,832 6.1%
26,307 484,469,019 18,417 39.9 2,774 9.3%
26,307 484,469,019 18,417 39.9 2,659 8.5%
25,024 503,179,300 20,430 41.4 2,789 8.7%
25,024 503,179,300 20,430 41.4 2,682 8.0%
25,024 503,179,300 20,430 41.4 2,744 8.4%
25,024 503,179,300 20,430 41.4 3,138 8.2%
25,024 503,179,300 20,430 41.4 2,843 5.6%
25,024 503,179,300 20,430 41.4 3,139 6.2%
25,024 503,179,300 20,430 41.4 3,132 6.8%
Sources:
(1)Bureau of the Census Count - 2000, 2010
(2)Board of Education; represents elementary and secondary public schools.
(3)Kentucky Cabinet for Human Resources, Department for Employment Services.
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TABLE 15
CITY OF PADUCAH, KENTUCKY
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
(1) (1) (2)(3)
Per Capita Median School Unemployment
Enrollment RateAgeIncome
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
Fiscal Year Population
2014-2015
2015-2016
2016-2017
Percentage ofPercentage ofTotalTotalEmployees (1) Employment (2) Employees (1) Employment (2)Western Baptist Hospital1,7106.13%1,7005.66%Lourdes Hospital1,4505.20%1,4004.66%Wal Mart9253.32%1,2004.00%Paducah Public Schools5461.96%6002.00%West Kentucky Community and Technical College4901.76%3801.27%City of Paducah3951.42%3401.13%State of Kentucky3401.22%3901.30%Computer Services, Inc.2750.99%Parkview Convalescent Center2500.90%Paxton Media Group1900.68%2900.97%LYNX Services3601.20%NRE Acquisitions2200.73%TOTALS6,57123.57%6,88022.92%(1) Source - City of Paducah Finance Department(2) State of Kentucky - Office of Employment and Training. Ratio based on employment within County of McCracken.-138-EmployerTABLE 16CITY OF PADUCAH, KENTUCKYPRINCIPAL EMPLOYERSCURRENT YEAR AND NINE YEARS PRIOR20082017
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008Governmental ActivitiesGeneral governmentGeneral administration12 11 11 11 12 12 12 12 12 12Finance11 11 11 11 11 11 14 14 17 14Inspection000001111101313Information systems5555666644Risk/Human resources4333331114Public safetyPolice87 87 87 87 88 90 90 90 93 93Fire76 76 76 76 74 64.5 64 65 69 69Public serviceStreets21.2 21 21 20 20 23 23 23 29 29Facilities12.8 12.5 12.5 13.5 13.5 11.5 14 34 36 35Engineering5.8 6.6 6.6 6.6 7.6 7.67589E911**22000000000Other5555556466Parks and recreation25252524242424777Planning and development111010999991011OtherPaducah Riverfront Dev. Authority0111110000Renaissance0003345350Fleet maintenance6.5 6.5 6.5 6.5 6.5 6.5 6.5867Business-type ActivitiesSolid waste25.7 25.4 25.4 25.4 25.4 25.4 26 27 27 27TOTAL PRIMARY GOVERNMENT330 306 306 307 309 314.5 318 318 343 340* Employee budget census.** E911 became a City department effective 7/1/16.-139-Fiscal YearTABLE 17CITY OF PADUCAH, KENTUCKYCITY FULL-TIME EMPLOYEES BY FUNCTION*Last Ten Fiscal Years
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008General governmentBuilding and electrical permits issued1,285 1,344 1,175 1,251 1,202 1,232 1,239 1,263 1,179 1,203 Business licenses issued4,234 3,826 3,729 3,717 3,966 3,956 3,254 3,397 3,691 3,507 Public safetyPoliceAdult arrests2,259 2,174 2,293 2,546 2,508 2,753 3,564 3,859 4,454 4,170 Murder1 2 2 3 - 3 3 1 5 - Rape13 11 10 17 16 14 22 12 20 15 Robberies29 42 41 36 38 14 31 56 41 49 Burglary130 185 138 127 142 123 155 245 169 203 Auto theft89 59 49 60 41 47 54 62 57 60 Larceny1,027 1,173 1,138 1,090 1,110 1,005 1,013 1,092 1,106 *Arson6 7 2 3 5 7 6 7 7 8 Traffic accidents1,826 1,936 1,722 1,664 1,573 1,666 1,762 1,774 1,368 1,519 Traffic violations4,663 4,231 5,501 6,821 10,168 8,573 7,701 7,240 9,143 7,109 FireEmergency responses3,275 3,201 2,956 2,935 3,054 3,164 3,181 2,603 3,305 2,603 Fires extinguished135 124 118 115 105 138 122 133 136 102 Structure fires36 42 42 35 33 53 37 49 57 49 Incidents with reportedlosses138 72 73 56 55 89 73 89 85 70 Medical/rescue2,308 2,259 2,150 2,080 2,151 2,270 2,133 1,690 1,616 1,506 Tours/in-services/carseats262 305 400 378 570 524 671 676 907 699 Training man hours8,378 10,589 10,860 8,959 9,155 7,232 7,033 8,493 7,716 4,344 Inspections2,126 2,060 1,324 1,710 1,157 1,417 1,063 985 1,183 1,449 Refuse collectionResidentialRefuse collected (tons36 41 34 36 36 34 34 38 32 25 per day)Customers served9,806 9,801 9,639 9,600 9,478 9,488 9,568 9,445 9,435 9,446 CommercialRefuse collected (tons70 61 64 61 65 71 71 70 75 83 per day)Customers served858 854 861 927 805 803 806 810 810 821 Public service911 dispatches94,053 85,380 83,465 83,614 92,786 79,333 82,268 79,768 81,525 83,871 Police53,896 46,660 44,337 43,877 51,131 43,686 44,794 42,496 40,921 43,420 Fire3,314 3,230 3,152 3,517 4,747 3,189 3,226 2,702 2,490 2,720 Other36,843 35,490 35,976 36,220 36,908 32,458 34,248 34,570 38,114 37,731 * Information not available.** Information from city departments-140-Fiscal YearTABLE 18CITY OF PADUCAH, KENTUCKYOPERATING INDICATORS BY FUNCTION**Last Ten Fiscal Years
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008Public safetyPoliceStations1111111111FireStations5555555555Refuse collectionCollection trucksResidential10 10 10 10 10 1099710Commercial4444444545Other public worksStreets (miles paved)218 218 218 218 218 218 218 218 216 216Sidewalks (miles)47 47 47 47 47 47 47 47 45 45Traffic signals13 13 13 13 13 13 13 13 12 11Parks and recreationParks29 29 28 28 27 27 27 27 27 27Acreage960 960 960 960 960 1125 1125 1125 960 960Community centers2222222111Swimming pools1111111111Public tennis courts6666666666Public golf courses2222222222* Information from city departments.-141-Fiscal YearTABLE 19CITY OF PADUCAH, KENTUCKYCAPITAL ASSET STATISTICS BY FUNCTION*Last Ten Fiscal Years
Federal
CFDA Pass-Through Pass-Through
Program Title:Number Grantor Number To Subrecipients Expenditures
Department of Housing and Urban
Development:
Direct Programs:
Section 8 Housing Choice Vouchers 14.871 N/A -$ 1,952,018$
Pass-through Kentucky Governors
Office for Local Development:
Community Development Block Grants 14.228 N/A 220,000 220,000
Total Department of Housing and Urban
Development 220,000 2,172,018
Department of the Interior:
Pass-through Kentucky Department of
Fish and Wildlife Resources
Sportfishing and Boating Safety Act 15.622 PON2-094-1500003154-1 - 472,105
Passed-through Kentucky Governors
Office for Local Development:
15.916 N/A - 69,652
Total Department of the Interior - 541,757
Department of Justice:
Direct Programs:
Bulletproof Vest Partnership Program 16.607 N/A - 2,220
Edward Byrne Memorial Justice
Assistance Grant Program 16.738 N/A - 11,963
Total Department of Justice - 14,183
Department of Homeland Security:
Direct Programs:
Assistance to Firefighters Grant 97.044 N/A - 82,371
Total Department of Homeland Security - 82,371
Department of Transportation:
Passed-through Kentucky Transportation Cabinet
State and Community Highway Safety 20.600 PT-15-43 - 5,600
State and Community Highway Safety 20.600 PT-16-45 - 15,953
Highway Planning and Construction 20.205 N/A - 42,914
Highway Planning and Construction 20.205 N/A - 15,036
Highway Planning and Construction 20.205 P02-625-1500004634 - 884,280
Total Department of Transportation - 963,783
TOTAL EXPENDITURES OF FEDERAL AWARDS 220,000$ 3,774,112$
See accompanying notes to schedule of expenditures of federal awards.
-142-
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2017
Federal Grantor/Pass-Through Grantor/
Outdoor Recreation, Acquisition,
Development and Planning
CITY OF PADUCAH, KENTUCKY
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2017
Note 1 - Basis of Presentation:
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 Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements
for Federal Award (Uniform Guidance). 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:
Federal
CFDA Amount
Program Title Number Provided
Four Rivers Recovery Center 14.228 $220,000
Note 3 – Indirect Cost Rate:
The City of Paducah has not elected to use the 10% de minimis indirect cost rate as allowed under the
Uniform Guidance.
Note 4 – Reconciliation of Federal Awards to the Financial Statements:
Total Federal Awards $ 3,774,112
Federal Awards by Fund
General Fund $ 32,553
Capital Improvement Fund 1,580,541
Special Revenue Fund 209,000
Proprietary Fund 1,952,018
Total Federal Awards $ 3,774,112
-143-
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND
ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Honorable Brandi Harless, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General
of the United States, the financial statements of the governmental activities, the 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, 2017, and the related notes to the financial statements, which
collectively comprise City of Paducah, Kentucky’s basic financial statements, and have issued our report thereon dated
December 8, 2017.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered City of Paducah, Kentucky’s internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of City of Paducah, Kentucky’s internal control. Accordingly, we do not
express an opinion on the effectiveness of City of Paducah, Kentucky’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements
on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that
there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented,
or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in
internal control that is less severe than a material weakness, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was
not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies.
Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be
material weaknesses. However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City of Paducah, Kentucky’s financial statements are free
from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts,
and grant agreements, noncompliance with which could have a direct and material effect on the determination of
financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective
of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of
noncompliance or other matters that are required to be reported under Government Auditing Standards.
100 South 4th Street Suite 300 Paducah, KY 42001
Phone: (270)443-4400 Fax: (270)443-0963 kempercpa.com
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the
results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on
compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in
considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other
purpose.
Certified Public Accountants and Consultants
Paducah, Kentucky
December 21, 2017
-145-
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM
AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
Honorable Brandi Harless, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
Report on Compliance for Each Major Federal Program
We have audited City of Paducah, Kentucky’s compliance with the types of compliance requirements described in the
OMB Compliance Supplement that could have a direct and material effect on each of City of Paducah, Kentucky’s
major federal programs for the year ended June 30, 2017. 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.
Management’s Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal
awards applicable to its federal programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of City of Paducah, Kentucky’s major federal
programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of
compliance in accordance with auditing standards generally accepted in the United States of America; the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the
United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and
Uniform Guidance 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 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 on compliance for each major federal program.
However, our audit does not provide a legal determination of City of Paducah, Kentucky’s compliance.
Opinion on Each Major Federal Program
In our opinion, City of Paducah, Kentucky, complied, in all material respects, with the types of compliance
requirements referred to above that could have a direct and material effect on each of its major federal programs for the
year ended June 30, 2017.
Report on Internal Control Over Compliance
Management of City of Paducah, Kentucky, is responsible for establishing and maintaining effective internal control
over compliance with the types of compliance requirements referred to above. In planning and performing our audit of
compliance, we considered City of Paducah, Kentucky’s internal control over compliance with the types of
requirements that could have a direct and material effect on each major federal program to determine the auditing
procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each
major federal program and to test and report on internal control over compliance in accordance with the Uniform
Guidance, 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.
100 South 4th Street Suite 300 Paducah, KY 42001
Phone: (270)443-4400 Fax: (270)443-0963 kempercpa.com
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. A significant
deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over
compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in
internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of
this section and was not designed to identify all deficiencies in internal control over compliance that might be material
weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal
control over compliance and the results of that testing based on the requirements of the Uniform Guidance.
Accordingly, this report is not suitable for any other purpose.
Certified Public Accountants and Consultants
Paducah, Kentucky
December 21, 2017
-147-
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
RESTATED FOR ADDITIONAL MAJOR PROGRAM
YEAR ENDED JUNE 30, 2017
Section I – Summary of Auditor’s Results
1. The independent auditor’s report expresses an unmodified opinion on the financial statements of
the City of Paducah, Kentucky.
2. No significant deficiencies relating to the audit of the financial statements are reported. No
material weaknesses relating to the audit of the financial statements are reported.
3. No instances of noncompliance material to the financial statements of the City of Paducah,
Kentucky were disclosed during the audit.
4. No significant deficiencies relating to the audit of major federal award programs are reported. No
material weaknesses relating to the audit of major federal award programs are reported.
5. The auditor’s report on compliance for the major federal award programs for the City of Paducah,
Kentucky expresses an unmodified opinion.
6. There are no findings to be reported in accordance with 2 CFR Section 200.516(a) in this
schedule.
7. The programs tested as major programs included:
Name CFDA
Section 8 Housing Choice Vouchers 14.871
8. The threshold used for distinguishing Types A and B programs was $750,000.
9. The City of Paducah, Kentucky did qualify to be audited as a low-risk auditee.
Section II – Findings – Financial Statements Audit
There are no findings related to the financial statements which are required to be reported in accordance
with Government Auditing Standards.
Section III – Findings and Questioned Costs – Major Federal Awards Programs
There are no findings or questioned costs related to the major federal programs which are required to be
reported in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles and Audit Requirements for Federal Award (Uniform Guidance).
-148-
CITY OF PADUCAH, KENTUCKY
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
YEAR ENDED JUNE 30, 2016
Section II – Findings – Financial Statements Audit
There were no findings related to the financial statements which are required to be reported in accordance
with Government Auditing Standards.
Section III – Findings and Questioned Costs – Major Federal Awards Programs
There were no findings or questioned costs related to the major federal programs which are required to be
reported in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles and Audit Requirements for Federal Award (Uniform Guidance).
-149-