CAFR for Year Ending 12/31/10

CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT

For The Year Ended December 31, 2010 REPORT ISSUED BY: DEPARTMENT OF FINANCE VICTORIA A. RUNKLE, DIRECTOR

CITY OF ARVADA, COLORADO COMPREHENSIVE ANNUAL FINANCIAL REPORT

December 31, 2010

TABLE OF CONTENTS

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INTRODUCTORY SECTION

Letter of Transmittal – Director of Finance................................................................................. 1-4

Government Finance Officers Association Certificate of Achievement ....................................... 5

City Officials.................................................................................................................................. 6

Organizational Chart .................................................................................................................... 7

FINANCIAL SECTION Report of Independent Certified Public Accountants ............................................................ 9

Management’s Discussion and Analysis............................................................................. 11-22 Basic Financial Statements

Government-wide Financial Statements

Statement of Net Assets................................................................................................. 23 Statement of Activities................................................................................................. 24-25

Fund Financial Statements

Governmental Funds Financial Statements Balance Sheet.......................................................................................................... 26 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets ......................................................................... 27 Statement of Revenues, Expenditures, and Changes In Fund Balances ............... 28 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities....................................................................................... 29 General Fund Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 30 Community Development Fund Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 31 Arvada Center Fund – Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 32 Parks Fund - Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 33

Proprietary Fund Financial Statements

Statement of Net Assets .......................................................................................... 34 Statement of Revenues, Expenses and Changes in Fund Net Assets ................... 35 Statement of Cash Flows......................................................................................... 36

Fiduciary Fund Financial Statements

Statements of Fiduciary Net Assets......................................................................... 37 Statements of Changes in Fiduciary Net Assets ..................................................... 38


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Notes to the Financial Statements ....................................................................................... 39-70

Required Supplementary Information Schedule of Funding Progress.......................................................................................... 71

Supplementary Information

Combining and Individual Fund Statements and Schedules Construction Fund ................................................................................................... 72

Non-Major Governmental Funds Combining Balance Sheet .................................................................................... 74-75 Combining Statement of Revenues, Expenditures and Changes in Fund Balances............................................................................................ 76-77 Lands Dedicated Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 78 Drainage Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 79 Arvada Housing Authority – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 80 Police Seizure Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 81 Police Tax Increment Fund (.21) – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 82 Police Tax Increment Fund (.25) – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 83 Repayment Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 84 Grants Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 85 Bond Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 86 Debt Service Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual............................................................... 87

Enterprise Funds

Water Fund – Budgetary Comparison Schedule ..................................................... 90 Wastewater Fund – Budgetary Comparison Schedule ........................................... 91 Stormwater Fund – Budgetary Comparison Schedule ............................................ 92 Golf Fund – Budgetary Comparison Schedule ........................................................ 93 Food Service Fund – Budgetary Comparison Schedule ......................................... 94

Internal Service Funds

Combining Statement of Net Assets........................................................................ 96 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets ......................................................................................................... 97 Combining Statement of Cash Flows ...................................................................... 98 Insurance Service Fund – Budgetary Comparison Schedule.................................. 99 Computer Fund – Budgetary Comparison Schedule.............................................. 100 Print Shop Fund – Budgetary Comparison Schedule............................................. 101


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Vehicle Fund – Budgetary Comparison Schedule.................................................. 102 Building Fund – Budgetary Comparison Schedule................................................. 103

Fiduciary Fund

Agency Fund – Statement of Changes in Assets and Liabilities ............................ 105

Local Highway Finance Report .............................................................................. 107-108

STATISTICAL SECTION Financial Trends

Net Assets by Component ................................................................................................... 110 Changes in Net Assets (expenses) ..................................................................................... 111 Changes in Net Assets (revenues) ...................................................................................... 112 Fund Balances, Governmental Funds ................................................................................. 113 Changes in Fund Balances, Governmental Funds.............................................................. 114 Revenue Capacity

Direct and Overlapping Property Tax Rates........................................................................ 115 Sales and Use Tax Revenue ........................................................................................... 116-117 Principal Property Tax Payers ......................................................................................... 118-119 Property Tax Levies and Collections ................................................................................... 120 Assessed Value and Actual Value of Taxable Property ...................................................... 121 Debt Capacity

Ratios of Outstanding Debt by Type.................................................................................... 122 Ratios of General Bonded Debt Outstanding ...................................................................... 123 Direct and Overlapping Governmental Activities Debt ........................................................ 124 Legal Debt Margin Information ............................................................................................ 125 Pledged-Revenue Coverage ............................................................................................... 126 Schedule of Debt Service Requirements – Governmental Activities................................... 127 Schedule of Debt Service Requirements – Business-type Activities................................... 128 Demographic and Economic Information

Demographic and Economic Statistics ................................................................................ 129 Principal Employers ......................................................................................................... 130-131 Operating Information

Full-time Equivalent City Government Employees by Function/Program............................ 132 Operating Indicators by Function/Program.......................................................................... 133 Capital Asset Statistics by Function/Program...................................................................... 134


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P.O. BOX 8101 8101 RALSTON ROAD ARVADA, COLORADO 80001-8101

FINANCE DEPARTMENT FACSIMILE: 720-898-7846 TDD: 720-898-7869

PHONE: 720-898-7120 June 28, 2011 Citizens of the City of Arvada, Honorable Mayor, Members of City Council and City Manager We are pleased to submit the Comprehensive Annual Financial Report for Arvada Colorado for the fiscal year ended December 31, 2010. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the management of the City. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present the financial position and results of operations of various funds and component units of the City in accordance with Generally Accepted Accounting Principles (GAAP). All disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have been included. In addition to an annual audit of the City’s financial records performed by a third-party private auditor, the City is also required to have an annual single audit in conformity with the provisions of the Single Audit Act, as amended, and U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. Information related to this single audit, including the schedules of federal and state financial assistance, findings and recommendations, and independent auditors’ reports on the internal control structure and compliance with applicable laws and regulations, are not included herein but are reported separately. In conformity with generally accepted accounting principles, as set forth in Government Accounting Standards Board (GASB) Statement 14, The Reporting Entity, and Statement 39, Determining Whether Certain Organizations are Component Units, this report includes all funds of the primary government and the City’s component units. For this report the City of Arvada and all its departments and funds comprise the Reporting Entity. Our component units are the Arvada Urban Renewal Authority and the Arvada Economic Development Association. The City is required to provide a narrative introduction, overview and analysis to accompany the basic financial statements in the form of management’s discussion and analysis (MD&A). This letter of transmittal is intended to complement the MD&A and should be read in conjunction with it. PROFILE OF THE CITY OF ARVADA The City of Arvada is located approximately 20 miles to the northwest of the City of Denver Colorado along Interstate 70. The City provides a full range of services, including police protection, physical parks, planning and zoning, transportation planning, street improvements and maintenance, a housing authority, a regional cultural center, two golf courses, municipal court services, water, waste water and storm water services and facilities, along with various administrative functions. The area has separate governmental units that provide fire protection and recreational services. The population of the City is approximately 108,539. THE ECONOMIC FACTORS OF 2010 The City’s finances continued to be unpredictable in 2010. Sales and use taxes combined, which comprise over 50 percent of our revenue for general governmental activities, were up 1.5% over 2009. While this increase was minimal, we viewed it as a positive sign that the City had stabilized and would build momentum for the future years.

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 2 Permit revenue was up for the first six months of 2010 as the last remaining roofs damaged in the hail storm were replaced. We also issued 190 permits for single family homes which more than doubled the number issued in 2009. While this number is still below our historic average, we are hopeful that this is a trend that will continue in 2011 and 2012. The City continued to focus on capital expenditures as over $24.7 million dollars was transferred into the Capital Projects Fund for current and future capital needs. This revenue came from many different sources including the General Fund, Parks Fund, Grants Fund, Construction Fund, Stormwater Fund, Insurance Fund and Vehicle Fund. While this is a large sum of money, it only represents a partial funding of the capital needs identified by City Council, the staff and the citizens of Arvada. Future years will continue to see a dedication to capital as the City’s aging infrastructure is in need of repair. The City departments continued to save budget dollars at every opportunity as the three ballot issues, Proposition 101 and Initiatives 60 and 61, were up for vote in November. While the voters did not pass these issues, the conservative efforts throughout the year did lead to savings of over $2.4 across all funds and $1.7 million in the General Fund. A large percentage of this savings came from personnel as many vacant positions were held open pending the November vote. FUTURE ECONOMIC FACTORS The City of Arvada’s current sales tax base is primarily based upon grocery store anchored shopping areas. In addition, we have five major value-based retailers: Kohl’s, Costco, Sam’s Club, K-Mart and Target shopping areas. We know from national statistics that people tended to shop at these value-based stores in 2010 over other discretionary spending. The question all economists and other interested analysts are asking is what will be significant changes in consumer spending based on the experience of this economic recession. While we certainly do not know the answer to that question, we know that before the recession, these businesses attracted consumers. While we need to always be scanning the environment for competitors to these businesses, we also know that we must ensure the best thing the government can do is strategically invest its capital dollars to ensure the City provides the necessary infrastructure to help all our businesses. To that end, our policy makers have defined their focus for the next two years. The City’s policy makers have clearly articulated that for the next two years, they will focus on capital improvements that strengthen our relationships with both other public agencies and the private sector. Through a series of special meetings, they have:

√ Identified and dedicated $1.5 million of additional funding to street maintenance ($800,000), park maintenance ($500,000) and neighborhood revitalization ($200,000).

√ Transferred $500,000 and reserved another $500,000 to the Arvada Economic Development Association (AEDA) to be used for small business loans and grants.

√ Allocated an additional $900,000 to capital maintenance. This funding was created through reductions in internal service funds transfers and further reductions in line items.

√ Dedicated further funding to the Jefferson Parkway Public Highway Authority (JPPHA), a municipal corporation organized in May 2008 to help facilitate the financing, construction, operation and maintenance of a public highway located on the northern and western perimeters of the Denver metropolitan area. JPPHA is currently working with private businesses and the local governments to refine conceptual engineering and firm up financing. When constructed, this road will complete the beltway loop around the greater Denver metro region.

√ Dedicated monies to hold in reserve for improvements to Wadsworth Boulevard, which is the main arterial that runs through the City.

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 3 We believe our current economic base will slowly grow: the businesses we have provide the basic needs of our consumers. The only way to expand our economic base is to build upon the assets we currently have – our small businesses, the AURA districts and the partnerships with our regional partners. Also, because we realize our current economic base will only slowly grow, we made some ongoing reductions to our base budget. We reduced our position count in the 2011 budget by 10.5 (the net of 17 position eliminations and 6.5 position additions) across all funds, and departments reduced ongoing expenditures by over one million dollars. These changes better aligned the business needs of the organization for the future. This will be an ongoing annual process. We have learned over the past years that we must constantly question our level of services and how we might provide what we must as effectively and efficiently as possible. We believe we have developed both internal and external collaborations that will help us face the very different and unknown economic environment. FINANCIAL INFORMATION Pension Trust Funds: The City has three defined contribution programs for different types of employees: City of Arvada Retirement Program (CARP) for its regular employees; the Arvada Police Pension Plan (APPP) for its uniformed police officers; and the Executive Management Program for the appointed management team. The City deposits between 10% – 15% into an individual’s account and the employee must contribute between 8% - 10%. The employee directs their own investments within a limitation of funds as identified by each Board. In addition, the City offers a voluntary 457 program where employees can place additional dollars for retirement on a tax-free basis. All four programs have independently elected boards. The APPP uses Fidelity Investments as their record keeper. The others all use Great West Retirement Services. The Council adopts the investment plans of all the Boards. Internal Control Structure: The City of Arvada establishes and maintains an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse, and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived, and valuation of costs and benefits requires estimates and judgments by management. Budgetary Controls: The City of Arvada maintains budgetary controls in order to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City of Arvada’s City Council, its governing body. All activities of the City are included in the annual appropriated budget. The City maintains an accounting system to provide management with information regarding obligations against appropriations. Budgetary compliance is based on expenditures during the period (GAAP), rather than expenditures and encumbrances (non-GAAP). Because appropriations lapse at December 31, encumbrances outstanding are carried over and become a liability on the 2011 budget. Appropriations for fiscal 2011 will provide the authority to complete those transactions. Single Audit: As a recipient of federal and state financial assistance, the City is responsible for ensuring that adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. As part of the City's single audit, tests are performed to determine the adequacy of the internal control structure, including that portion related to federal financial assistance programs, as well as to determine that the City has complied, in all material respects, with applicable laws and regulations. The results of the City’s single audit for fiscal year 2010, including any reported instances of significant deficiencies in the internal control structure or any violations of applicable laws and regulations, are reported separately. Independent Audit: Section 10.9 of the City of Arvada’s charter requires an annual audit of accounts and other evidences of financial transactions of the City and its departments by independent certified public accountants. The

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 4 audit is performed by a firm chosen by a three-member audit board consisting of the City Manager and two members of the City Council, known as the Finance Committee. This year Clifton Gunderson LLP, a firm of independent accountants, audited the financial statements for the year ended December 31, 2010. AWARDS AND ACKNOWLEDGEMENTS 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 Arvada for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2009. The City of Arvada has received this award for over 26 consecutive years. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized CAFR. This report must satisfy generally accepted accounting principles and applicable legal requirements. A certificate of achievement is valid for a period of one year only. We believe that our current CAFR continues to meet the certificate of achievement program requirements and we are submitting it to the committee to determine its eligibility for another certificate. The preparation of this report could not have been accomplished without the professionalism and dedication demonstrated by the financial and management personnel of each department. Special mention needs to be directed to the dedicated employees of the Finance Department charged with ensuring that all accounting principles are adhered to each and every day, thus ensuring the efficient and effective preparation of this audit and document. Special thanks goes to Lisa Yagi, Assistant Finance Director; Bryan Archer, Controller; and many people of his team. The production of the document was in the capable hands of Arlene Martinez, the Finance Department’s Executive Secretary, and Steve Milke, the City’s Creative Services Designer. Respectfully submitted, Victoria A. Runkle Director of Finance


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City Officials

Bob Frie Mayor

(Term expires 2011)

Don Allard Councilmember – At-Large

(Term expires 2013)

Rachel Zenzinger Councilmember – District 1

(Term expires 2013)

Mark McGoff Councilmember – District 2

(Term expires 2011)

Shelley Cook Councilmember – District 3

(Term expires 2013)

Bob Dyer Mayor Pro Tem

Councilmember – District 4 (Term expires 2011)

Marc Williams Councilmember – At-Large

(Term expires 2011)

City Manager and Key Staff

Craig G. Kocian City Manager William Ray Deputy City Manager George Boyle Municipal Judge Christopher K. Daly City Attorney Jo Mattoon Director of Human Resources James Root Director of Public Works Michael Elms Director of Community Development Victoria A. Runkle Director of Finance Gene Sobczak Executive Director of Arvada Center Chris Koch City Clerk Gordon Reusink Director of Parks, Golf and Hospitality Services Timothy Steinhaus Executive Director of Arvada Urban Renewal Authority Hazel Hartbarger Director of Arvada Economic Development Association Michele Hovet Director of Information Technology Vicky Reier Assistant to the City Manager Don Wick Chief of Police


December 31, 2010


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Independent Auditor’s Report Honorable Mayor and Members of City Council City of Arvada Arvada, Colorado We have audited the accompanying financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Arvada as of and for the year ended December 31, 2010, which collectively comprise the City of Arvada’s basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City of Arvada’s management. Our responsibility is to express opinions on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our 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 aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Arvada as of December 31, 2010, and the respective changes in financial position and cash flows, where applicable, thereof, and the respective budgetary comparison for the General Fund, Community Development Fund, Arvada Center Fund, and Parks Fund, for the year then ended in conformity with accounting principles generally accepted in the United States of America.

In accordance with Government Auditing Standards, we have also issued our report dated June 28, 2011 on our consideration of the City of Arvada’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 the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.

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The management’s discussion and analysis and other post-employment benefit information on pages 11 through 22 and 71 are not a required part of the basic financial statements but are supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it.

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Arvada’s basic financial statements. The supplementary information listed in the table of contents is presented for purposes of legal compliance and additional analysis and is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. The introductory section and statistical section listed in the table of contents have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them.

a1 Greenwood Village, Colorado June 28, 2011

CITY OF ARVADA, COLORADO MANAGEMENT’S DISCUSSION AND ANALYSIS

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This section of the City of Arvada’s Comprehensive Annual Financial Report provides readers with a narrative overview and analysis of the City’s financial performance during the fiscal year that ended on December 31, 2010. We encourage readers to consider the information presented here in conjunction with the letter of transmittal at the front of this report, the City’s basic financial statements and notes to the financial statements, to enhance their understanding of the activities and financial health of the City of Arvada. Overview of Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements consist of the following three components:

• Government-wide Financial Statements • Fund Financial Statements • Notes to the Financial Statements

Other supplementary information is also included at the end of the report. Government-wide Financial Statements. The government-wide statements are designed to provide readers with a broad overview of the City’s finances using the accrual basis of accounting, the basis of accounting used by most private-sector businesses. The statement of net assets presents information on all of the City’s assets and liabilities. The difference between assets and liabilities are reported as net assets. Over time, increases and decreases in net assets may provide an indication of whether the City’s financial position is improving or deteriorating. The statement of activities presents information reflecting how the City’s net assets have changed during the fiscal year that just ended. All changes in net assets are reported as soon as the underlying activity occurs. Thus, revenues and expenses are reported in these statements for some items that will only result in cash flows in future periods (e.g. uncollected taxes and earned but unused vacation leave). The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (government activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, public works, parks, cultural and human service. The business-type activities of the City include water, wastewater, stormwater, golf and food service. The government-wide financial statements also include both the Arvada Urban Renewal Association and Arvada Economic Development Association as discretely presented component units of the City. Fund Financial Statements. Traditional users of the City’s financial statements will find the fund financial statement presentation more familiar. The focus is now on major funds rather than fund types. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. A major fund should generally meet both of the following criteria: 1) total assets, liabilities, revenues, or expenditures/expenses are at least 10% of the corresponding total (assets, liabilities or expenditures/expenses) for that fund type (i.e. governmental or enterprise funds) and 2) total assets, liabilities, revenues, or expenditures/expenses of the individual governmental or enterprise fund are at least 5% of the corresponding total for all governmental and enterprise funds combined.


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The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All funds of the City can be divided into three categories: governmental funds, proprietary funds and fiduciary funds. Governmental Funds. Governmental funds are used to report those same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide statements, the fund financial statements are prepared on the modified accrual basis. Under the modified accrual basis of accounting, revenues are recognized when they become measurable and available, and expenditures are recognized when the related fund liability is incurred, with the exception of long-term debt and similar long-term items which are recorded when due. Therefore, the focus of the governmental fund financial statements is on near-term inflows and outflows of spendable resources as well as on the balance of spendable resources available at the end of the fiscal year. Since the focus of the governmental funds is on near-term resources, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. To facilitate this comparison, reconciliations are provided for both the governmental fund balance sheet and the governmental statements of revenues, expenditures and changes in fund balances. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balance for the General fund, Community Development fund, Arvada Center fund, Parks fund, General Capital Projects fund and the Construction fund. These six funds are considered to be major funds. Data from the other governmental funds is combined into a single aggregated presentation. Individual fund data for each of these non-major funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements. The City adopts an annual appropriated budget for all of its governmental funds. A budgetary comparison statement has been provided to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 26-28 of this report. Proprietary Funds. The City maintains two different types of proprietary funds, enterprise and internal service funds. The proprietary fund financial statements are prepared on the accrual basis of accounting. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water, wastewater, stormwater, food service and golf operations. Internal service funds are accounting devices used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for dental benefits provided by the City, its risk management program, its replacement of vehicles and information technology equipment, maintenance of vehicles and buildings and its print shop operations. The activity in these funds is allocated between the governmental and business-type activities based upon actual usage. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The Water, Wastewater and Stormwater and enterprise funds are considered to be major funds and are therefore presented separately within the proprietary fund financial statements. The Golf Course and Food Services funds do not qualify as major enterprise funds but are being presented as such. All internal service funds are considered to be non-major funds and they are combined into a single, aggregated column in the proprietary fund statements. Individual fund data for each of the non-major proprietary funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements.


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The basic proprietary fund financial statements can be found on pages 34-36 of this report. Fiduciary Funds. The City maintains two different types of fiduciary funds, trust and agency funds. The fiduciary fund financial statements are prepared on the accrual basis of accounting. The fiduciary funds are used to account for resources held by the City in a trustee capacity or as an agent for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of these funds are not available to support the City’s own programs. The funds underlying each of the fiduciary fund types are combined into a single, aggregated column in the fiduciary fund statements The City does not adopt an annual appropriated budget for its fiduciary funds. The basic fiduciary fund financial statements can be found on pages 37-38 of this report. Notes to the Financial Statements. The notes to the basic financial statements are considered an integral part of the financial statements since they provide additional information needed to gain a full understanding of the data provided in both the government-wide and fund financial statements. The notes to the financial statements can be found on pages 39-70 of this report. Combining Statements. The combining statements referred to earlier in connection with the non-major governmental funds, non-major enterprise funds, internal service funds and fiduciary funds are presented following the required notes to the financial statements. Infrastructure Assets. Historically, infrastructure assets (roads, bridges and capital improvements other than buildings) have not been reported or depreciated in governmental financial statements. Infrastructure represents a significant portion of the government’s assets. Similarly, the outflow of resources expended by a government to maintain infrastructure also represents a sizeable portion of its operations. GASB 34 requires that the infrastructure assets be valued and reported within the governmental column of the government-wide statements. Government-wide Financial Analysis As noted earlier, net assets may serve over time as a useful indicator of a government’s financial position. At the close of December 31, 2010, the City’s assets exceeded liabilities by $635,169,000. The following summaries of net assets and changes in net assets are presented for the current year and the previous year in comparison format.


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Statement of Net Assets The following table reflects the condensed Statement of Net Assets:

2010 2009 2010 2009 2010 2009

Current and other assets $ 138,678 $ 138,880 $ 90,543 $ 91,710 $ 229,221 $ 230,590 Capital assets 266,315 267,231 219,525 216,571 485,840 483,802 Other non-current assets 5,984 2,898 184 203 6,168 3,101 Total assets 410,977 409,009 310,252 308,484 721,229 717,493

Other liabilities 19,509 26,767 4,595 3,569 24,104 30,336 Long-term liabilities 43,016 46,773 18,940 20,885 61,956 67,658 Total liabilities 62,525 73,540 23,535 24,454 86,060 97,994

Net assets: Invested in capital assets, net of related debt 222,197 218,883 198,953 194,128 421,150 413,011 Restricted 20,156 17,934 - - 20,156 17,934 Unrestricted 106,099 98,652 87,764 89,902 193,863 188,554 Total net assets $ 348,452 $ 335,469 $ 286,717 $ 284,030 $ 635,169 $ 619,499

Governmental Business-type Total Primary

City of ArvadaStatement of Net Assets

December 31, 2010(in thousands)

Activities Activities Government

For more detailed information, see the Statement of Net Assets on page 23 of this report. By far the largest portion of the City’s Governmental net assets (64 percent) reflects its investment in capital assets (e.g. land, buildings, improvements, infrastructure and equipment), less any debt used to acquire those assets still outstanding. The City of Arvada uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the City’s Governmental net assets (6 percent) represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets, $106,099,000 or (30 percent), may be used to meet the City’s ongoing obligations to its citizens and creditors. The City’s total net assets increased by $11,955,000 during the current fiscal year, net of the prior period adjustments. This is due to an increase in the governmental activities of $9,268,000 and an increase in the business-type activities of $2,687,000. The increase is primarily due to expansion in capital assets of both the City’s streets and utilities infrastructure, which are funded by dedicated revenues sources, contributed capital from developers and increases in user fees.


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Changes in Net Assets The following table reflects a condensed summary of activities and changes in net assets:

2010 2009 2010 2009 2010 2009

RevenuesProgram revenues: Charges for services $ 15,313 $ 16,254 $ 35,697 $ 33,386 $ 51,010 $ 49,640 Operating grants and contributions 11,790 9,501 64 - 11,854 9,501 Capital grants and contributions 180 2,789 2,584 1,581 2,764 4,370 General revenues: Sales and use taxes 50,259 49,530 - - 50,259 49,530 Property & Ownership taxes 4,961 5,121 - - 4,961 5,121 Other taxes and fees 4,761 4,665 - - 4,761 4,665 Interest 1,234 1,875 894 1,361 2,128 3,236 Other 3,119 462 84 1,319 3,203 1,781 Total revenues 91,617 90,197 39,323 37,647 130,940 127,844 Expenses General government $ 12,930 $ 14,267 $ - $ - $ 12,930 $ 14,267 Public safety 22,999 23,544 - - 22,999 23,544 Public works 17,102 16,967 - - 17,102 16,967 Parks and recreation 14,382 14,273 - - 14,382 14,273 Culture 10,004 10,649 - - 10,004 10,649 Human services 4,734 4,251 - - 4,734 4,251 Interest 1,579 2,329 - - 1,579 2,329 Water - - 19,150 19,386 19,150 19,386 Wastewater - - 9,341 8,770 9,341 8,770 Stormwater - - 1,279 1,366 1,279 1,366 Golf - - 3,871 4,010 3,871 4,010 Food - - 1,614 1,659 1,614 1,659 Total expenses 83,730 86,280 35,255 35,191 118,985 121,471 Increase in net assets before transfers 7,887 3,917 4,068 2,456 11,955 6,373 Transfers 1,381 882 (1,381) (882) - - Increase in net assets 9,268 4,799 2,687 1,574 11,955 6,373 Net assets, beginning 335,469 331,255 284,030 279,736 619,499 610,991 Prior period adjustments 3,715 (585) - 2,720 3,715 2,135 Net assets, ending $ 348,452 $ 335,469 $ 286,717 $ 284,030 $ 635,169 $ 619,499

City of ArvadaStatement of Activities

December 31, 2010(in thousands)

Governmental Business-type Total PrimaryActivities Activities Government

For more detailed information, see the Statement of Activities on pages 24-25 of this report. The above condensed summary of the City of Arvada’s governmental and business-type activities for the year ended December 31, 2010 reflects net assets increasing $11,955,000, net of the prior period adjustments. Revenues and expenses graphs are presented below to enhance the reader’s understanding of the current year activities.


December 31, 2010

16

Governmental Activities Governmental Activities increased Arvada’s Net Assets by $9,268,000

Charges for services16.71%

Operating grants and

contributions12.87%

Capital grants and contributions

0.20%Sales and use

taxes54.86%

Property & Ownership taxes

5.41%

Other taxes and fees5.20%

Interest1.35%

Other3.40%

2010 Revenues by Source Governmental Activties

$‐

$5,000

$10,000

$15,000

$20,000

$25,000

General Govt

Public Safety

Public Works

Parks & Rec

Culture Human Svc

Interest

2010 Expenses and Program RevenuesGovernmental Activities

Expense Revenue


December 31, 2010

17

Business-type Activities Business-type Activities increased Arvada’s Net Assets by $2,687,000.

Charges for services90.79%

Operating grants and contributions

0.16%

Capital grants and contributions

6.57%

Interest2.27% Other

0.21%

2010 Expenses and Program RevenuesBusiness‐Type Activities

‐

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Water Wastewater Stormwater Golf Food

2010 Expenses and Program RevenuesBusiness‐Type Activities

Expense Revenue


December 31, 2010

18

Governmental activities. Governmental activities in 2010 were driven by three primary initiatives. First, statewide there were three ballot initiatives, referred to as “60/61/101”. If any or all of these would have passed, it would have required the City to dramatically reduce all local services. While these did not pass, their impact was two-fold. The analysis of these initiatives required a significant amount of work for all departments. Also, it had a chilling impact on hiring for any vacant positions. The second major impact meant we left many positions vacant. In the General Activities, it translated into personnel savings of over $2,420,275. This added to net assets. The second primary initiative was the reduction of ten positions in the 2010 budget in the General Activities. The reductions in the 2010 budget were the result of an in-depth analysis of work. This resulted in lowering our actual employment costs by over $825,000 in 2010 from 2009, and this, of course, is an ongoing savings. The third primary initiative in the General Activities was the allocation of all unreserved cash balances from Internal Service, General and other small funds to both new capital projects and programs to help the creation of small businesses. Overall, we dedicated over $20 million to these projects, including $1.5 million to small business loan and grant programs and the balance to the CIP. This also helped increase our net assets. Also increasing our net assets was the savings that departments had in a variety of line items. In fuel alone, the City saved over $250,000 – again providing assets to our General Activities. We also ended the year with an identified budget of $2.6 million as support to an intergovernmental agency, the Jefferson Parkway Public Highway Authority (JPPHA). They did not need the $2.6 million in 2010; thus, this cash was left in the net assets at the end of the year. The JPPHA will be requesting these monies in 2011. Overall, the reserves performed nearly as we had estimated. The local economy began to perform somewhat better than 2009 with over $100,000 more in sales taxes, sales tax audit revenue of over $900,000 as compared to $600,000 in 2009, and improving revenue from the state-shared intergovernmental revenue of vehicle fuel taxes of $250,000. All of these changes helped increase the City’s net assets by $9,268,000. Business-type activities. Business-type activities increased the City’s net assets by $2,687,000. Key elements of this increase are due to the following: • Capital contributions from developers into the Water, Wastewater and Stormwater Funds • The budgeting strategy for 2010 included measures so the revenues would exceed expenses in the

Wastewater and Stormwater Funds for future large capital needs. • Expenses were down in the Golf Course and Food Service Funds compared to last year. This was

due to the economy, a reduction in revenues and the deferral of some capital purchases. Financial Analysis of the City’s Funds As noted previously, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. 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 assessing the


December 31, 2010

19

City’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of year. At the end of December 31, 2010, the City’s governmental funds reported combined ending fund balances of $104,722,000, an increase of $5,973,000 from the prior year including a prior period adjustment of $3,715,000. Approximately $83,742,000 (80 percent of that amount) constitutes unreserved fund balance, which is available for spending at the government’s discretion. The remainder of fund balance is reserved to indicate that it is not available for new spending because it has already been committed for prepaid expenses or inventory ($731,000), to fund a state constitution mandated emergency reserve ($3,518,000) or for other restricted purposes ($16,731,000). The General Fund is the main operating fund of the City. At December 31, 2010, the unreserved fund balance of the General Fund was $18,652,000 while the total fund balance was $21,058,000. The General Fund balance of the City decreased $11,681,000. This was primarily due to some large one-time transfers made to the Capital Projects Fund for future capital projects. The Community Development Fund is a major fund of the City. At December 31, 2010, the unreserved fund balance of the Community Development Fund was $5,527,000, while the total fund balance was $7,094,000. The fund balance decreased $425,000 in 2010. This was primarily caused by 3 new loans made in 2010. The Arvada Center Fund is a major fund of the City. At December 31, 2010, the unreserved fund balance of the Arvada Center Fund was $147,000, while the total fund balance was $617,000. The fund balance increased $313,000 in 2010, including a prior period adjustment of $332,000 related to the Arts Council. This was primarily caused by decreases in ticket sales and performance-related revenues and increased production costs. The Parks Fund is a major fund of the City for 2010. At December 31, 2010, the unreserved fund balance of the Parks Fund was $3,535,000, while the total fund balance was $3,830,000. The fund balance increased $1,321,000 in 2010, including a prior period adjustment of $3,383,000 related to Park development fees. This was primarily due to savings in expenditure lines, specifically personnel, temporary wages and utilities and increases in recovered costs and Open Space revenues. The General Capital Projects Fund is another major fund of the City. At December 31, 2010, the unreserved fund balance was $44,533,000, while the total fund balance was $45,305,000. The fund balance increased $15,755,000 in 2010. This increase was caused by transferring of dollars for multi-year and future year projects all in 2010. Examples of these are the Garrison Street Park and Bridge project, 2-3 year time period, the East and South Central Park projects, 3 year time periods, and the Wadsworth Corridor project, 3-5 year time period. The Construction Fund is the final major fund of the City. At December 31, 2010, the unreserved fund balance was $4,277,000 a decrease of $606,000 over 2009. This reduction was caused by two items, a transfer to the Capital Projects Fund for a future project and payment of final arbitrage on the 2005 COP Bond issue. Proprietary funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. The unrestricted net asset balances of the City’s proprietary funds (including the major enterprise funds) are reflected in the following table:


December 31, 2010

20

Unrestricted UnrestrictedNet Assets for Net Assets for

Year ended 12/31/10 Year ended 12/31/09Major Enterprise Funds Water 59,347$ 63,398$ Wastewater 10,204 9,609 Stormwater 10,788 11,631 Golf 20 (34) Food 904 909 Total of major enterprise funds 81,263 85,513 Internal service funds 23,473 23,452 Total proprietary funds 104,736$ 108,965$

Table of Unrestricted Net AssetsChange in Net Assets - Proprietary Funds

(in thousands)

Component units. The Arvada Economic Development Association (AEDA) was established to encourage all forms of economic development. Funding for AEDA consists of compensation from the City for services it renders the City and its citizens. The statement of net assets reflects a $1,061,000 unrestricted net asset balance. The unrestricted assets of AEDA amounted to $1,061,000. The total change in net assets for AEDA was an increase of $529,000. Budgetary Highlights General Fund. The increase from the original budgeted expenditures to the final budget amounted to $20,147,642: • Transfer to Capital Improvements $12,300,000 • Set aside for JPPHA 2,700,000 • Transfer to Arvada Center 705,000 • Purchase of AURA Loan 2,750,000 • Grants 1,082,092 • Miscellaneous Small Increases 610,550 $20,147,642 There were no significant variances between the final amended budget and the actual results. Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of December 31, 2010 amounted to $485,840,000 (net of accumulated depreciation). This investment in capital assets includes land, water rights, buildings and improvements, equipment and infrastructure.


December 31, 2010

21


Land and water rights 51,527$ 34,925$ 86,452$ Infrastructure 132,910 6,784 139,694 Construction in progress 7,516 724 8,240 Buildings 18,976 7,646 26,622 Improvements other than buildings 49,561 167,989 217,550 Equipment & Vehicles 5,825 1,457 7,282 Total capital assets 266,315$ 219,525$ 485,840$

City of ArvadaCapital Assets (net of depreciation)

as of December 31, 2010(in thousands)

Major capital improvements during this fiscal year include the following: Governmental Activities • Completion of the Skyline Estate Park • Completion of the Memorial Park Playground • Completion of traffic signal and lane change at 58th and Kipling Street • Completion of the Arvada Channel Trail • Purchase of land related to the Garrison Bridge project

Proprietary Activities • Completion of the Leyden Storage Facility • Completion of the Arvada Channel COP project • Completion of the Croke Pump Station Additional information of the City’s capital assets can be found in Note 3.B on pages 54-55 of this report. Long-term debt. At the end of December 31, 2010, the City had total debt outstanding of $63,984,000. Of this amount, $46,430,000 represents bonds secured by specified revenue sources (i.e. sales tax revenue bonds and water revenue bonds). The remaining $17,554,000 is represented by capital leases of $1,685,000, Certificates of Participation of $14,755,000, and an OPEB liability of $1,141,000.


December 31, 2010

22


Revenue bonds 27,775$ 18,655$ 46,430$ Certificates of Participation 14,755 - 14,755 OPEB 1,141 - 1,141 Capital leases 783 875 1,658

Total outstanding debt 44,454$ 19,530$ 63,984$

City of ArvadaOutstanding Debt

as of December 31, 2010(in thousands)

Additional information on the City’s long-term obligations can be found in Note 3.E on pages 57-61 of this report. Financial Contact The City’s financial statements are designed to provide users (citizens, taxpayers, customers, investors and creditors) with a general overview of the City’s finances and to demonstrate the City’s accountability. Questions concerning any of the information presented in this report or requests for additional information should be sent to the City’s Finance Director at the following address: City of Arvada Attention: Finance Director P.O. Box 8101 Arvada, CO 80001

CITY OF ARVADA, COLORADO

STATEMENT OF NET ASSETS December 31, 2010

(in thousands)

Govern- Business-mental type

Activities Activities Total AURA AEDA

ASSETS Cash and investments 125,501$ 80,810$ 206,311$ 1,831$ 656$ Restricted cash 1,746 - 1,746 - - Cash with fiscal agent - 25 25 - - Taxes receivable 10,738 - 10,738 5,270 - Accounts receivable, net of allowance for uncollectibles 3,302 4,355 7,657 72 427 Special assessments receivable 44 - 44 - - Accrued interest 275 186 461 - 1 Internal balances (4,636) 4,636 - - - Inventories 498 375 873 - - Prepaid costs 537 156 693 11 5 Notes Receivable – non-current 5,984 - 5,984 557 - Unamortized bond issuance costs 673 184 857 - - Property available for sale - - - 5,820 - Investment in LLC - - - 2,000 - Capital assets Land, water rights and construction in progress 59,043 35,649 94,692 - - Other capital assets, net 207,272 183,876 391,148 4 - Total capital assets 266,315 219,525 485,840 4 - Total assets 410,977 310,252 721,229 15,565 1,089 LIABILITIES Accounts & contracts payable 5,716 2,016 7,732 133 28

176 152 328 - - Deferred revenue 5,596 135 5,731 5,270 - Long-term liabilities Due within one year: Bonds and notes payable 3,202 1,734 4,936 - - Certificates of Participation 820 - 820 - - Claims payable 1,721 - 1,721 - - Capital leases 249 228 477 - - Compensated absences 2,029 330 2,359 - - Due in more than one year: Bonds and notes payable 25,378 17,963 43,341 2,745 - Certificates of Participation 13,935 - 13,935 - - Capital leases 534 647 1,181 - - OPEB 1,141 - 1,141 - - Compensated absences 2,028 330 2,358 6 - Total liabilities 62,525 23,535 86,060 8,154 28 NET ASSETS Invested in capital assets, net of related debt 222,197 198,953 421,150 4 - Restricted for: Debt Service 201 - 201 - - Emergencies 3,518 - 3,518 - - Letter of Credit 36 - 36 - - Scholarships & Grants 186 - 186 - - Conservation Trust 3,217 - 3,217 - - CDBG 1,524 - 1,524 - - Law Enforcement 11,474 - 11,474 - -Unrestricted 106,099 87,764 193,863 7,407 1,061 TOTAL NET ASSETS 348,452$ 286,717$ 635,169$ 7,411$ 1,061$

Accrued interest payable

Primary Government

Component Units

The accompanying notes are an integral part of these financial statements.

23


STATEMENT OF ACTIVITIES Year Ended December 31, 2010

(in thousands)

Operating CapitalGrants Grants

Charges and Andfor Contri- Contri-

Expenses Services butions butions Total

FUNCTIONS/PROGRAM ACTIVITIES:Primary Government: Governmental activities: General government 12,930$ 5,130$ 1,532$ -$ 6,662$ Public safety 22,999 1,578 - - 1,578 Public works 17,102 2,603 - - 2,603 Parks and recreation 14,382 1,479 4,002 180 5,661 Culture 10,004 4,454 1,214 - 5,668 Human services 4,734 69 5,042 - 5,111 Interest 1,579 - - - - Total governmental activities 83,730 15,313 11,790 180 27,283

Business-type activities: Water 19,150 17,250 - 2,172 19,422 Wastewater 9,341 9,904 - 328 10,232 Stormwater 1,279 3,099 64 84 3,247 Golf 3,871 3,890 - - 3,890 Food 1,614 1,554 - - 1,554 Total business-type activities 35,255 35,697 64 2,584 38,345

Total primary government 118,985 51,010 11,854 2,764 65,628

Component Units: AURA 6,411$ 173$ -$ -$ 173$ AEDA 707 - 1,228 - 1,228 Total component units 7,118$ 173$ 1,228$ -$ 1,401$

Program Revenues


24


25

Govern- Business- Component Componentmental Type Unit Unit

Activities Activities Total AURA AEDA

(6,268)$ -$ (6,268)$ -$ -$ (21,421) - (21,421) - - (14,499) - (14,499) - -

(8,721) - (8,721) - - (4,336) - (4,336) - -

377 - 377 - - (1,579) - (1,579) - -

(56,447) - (56,447) - -

- 272 272 - - - 891 891 - - - 1,968 1,968 - - - 19 19 - - - (60) (60) - - - 3,090 3,090 - -

(56,447) 3,090 (53,357) - -

-$ -$ -$ (6,238)$ -$ - - - - 521 -$ -$ -$ (6,238)$ 521$

General RevenuesTaxes: Property and Ownership 4,961$ -$ 4,961 6,015$ -$ Sales and use 50,259 - 50,259 514 - Transportation tax 4,761 - 4,761 - - Investment earnings 1,234 894 2,128 34 8 Miscellaneous 3,119 84 3,203 - - Transfers in (out) 1,381 (1,381) - - - Total 65,715 (403) 65,312 6,563 8 Change in net assets 9,268 2,687 11,955 325 529 Net assets, January 1 335,469 284,030 619,499 5,086 532 Prior Period Adjustment 3,715 - 3,715 2,000 - Net assets, December 31 348,452$ 286,717$ 635,169$ 7,411$ 1,061$

Changes in Net AssetsPrimary Government - City of Arvada

Net (Expense) Revenue and



GOVERNMENTAL FUNDS BALANCE SHEET December 31, 2010

(in thousands)

General Fund

Community Develop-

ment FundArvada Center Parks

General Capital

Projects Fund

Construction Fund

Other Govern-mental Funds

Total Govern-mental Funds

ASSETSCash and investments 18,801$ 5,456$ 1,477$ 2,551$ 45,598$ 4,277$ 21,933$ 100,093$ Restricted cash - 1,524 222 - - - - 1,746 Taxes receivable 10,022 - - 588 11 - 117 10,738 Accounts receivable, net of allowance for uncollectibles 350 348 3 918 991 1 688 3,299 Special assessments receivable - - - - 44 - - 44 Accrued interest 85 - 2 12 81 - 44 224 Due from other funds 37 - - - - - - 37 Inventories 204 - 79 9 - - - 292 Prepaid costs 381 - 78 39 - - 20 518 Non-current notes receivable, net of allowance for uncollectibles 2,778 3,206 - - - - 5,984 Total assets 32,658$ 10,534$ 1,861$ 4,117$ 46,725$ 4,278$ 22,802$ 122,975$

LIABILITIES AND FUND BALANCES LIABILITIESAccounts payable 4,145 9 282 266 385 1 224 5,312 Escrows payable - 1 - - - - - 1 Due to other funds - - - - - - 37 37 Deferred revenue 7,455 3,430 962 21 1,035 - - 12,903 Total liabilities 11,600 3,440 1,244 287 1,420 1 261 18,253

FUND BALANCESReserved for: Inventories 204 - - 9 - - - 213 Prepaid costs 381 - 78 39 - - 20 518 Conservation Trust - - - - - - 3,217 3,217 Law enforcement programs - - - - - - 11,474 11,474 Letter of Credit - - 36 - - - - 36 Community Development - 1,524 - - - - - 1,524 Housing - - - - - - 294 294 Scholarships & Grants - - 186 - - - - 186 Emergencies 1,821 43 170 247 772 - 465 3,518 Total reserved 2,406 1,567 470 295 772 - 15,470 20,980

Unreserved: Designated reported in: General fund - future 828 - - - - - - 828 Special revenue funds - - 166 - - - - 166 Undesignated reported in: General fund 17,824 - - - - - - 17,824 Special revenue funds - 5,527 (19) 3,535 - - 6,694 15,737 Debt Service funds - - - - - - 377 377 Capital projects funds - - - - 44,533 4,277 - 48,810 Total unreserved 18,652 5,527 147 3,535 44,533 4,277 7,071 83,742

Total fund balances 21,058 7,094 617 3,830 45,305 4,277 22,541 104,722

Total liabilities and fund balances 32,658$ 10,534$ 1,861$ 4,117$ 46,725$ 4,278$ 22,802$ 122,975$

Primary Government


26


27

RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS

December 31, 2010 (in thousands)

Amounts reported for governmental activities in the statement of net assets (page 23) are different because: Total fund balances – governmental funds (page 26) $ 104,722 Capital assets net of accumulated depreciation used in governmental activities are not current financial resources. Therefore, they are not reported in the fund financial statement. 260,865 Internal service funds are used by management to charge the costs of certain activities to individual funds. A portion of the assets and liabilities of internal service funds are included in the governmental activities in the statement of net assets. 23,657 Long-term assets are not available to pay current year expenditures and therefore are deferred in the fund Notes Receivable – non-current net of allowance 4,486 AURA Loan 2,745 Donated Art 77 7,308 Long-term liabilities and related items are not due and payable in the current period and accordingly are not reported in the fund financial statements. Balances at December 31, 2010 are: Bonds payable (28,580) Certificates of Participation (14,755) Obligation under capital lease (153) Interest Accrual (176) OPEB (1,141) Compensated absences (3,968) Unamortized bond issuance costs 673 Subtotal (48,100) Net assets of governmental activities (page 23) $348,452 The accompanying notes are an integral part of these financial statements.


GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES

Year Ended December 31, 2010 (in thousands)

General Fund

Community Develop-

ment FundArvada Center Parks

General Capital

Projects Fund

Construction Fund

Other Govern-mental Funds

Total Govern-mental Funds

REVENUESProperty and Ownership Taxes 4,961$ -$ -$ -$ -$ -$ -$ 4,961$ Sales and use taxes 39,646 - - - - - 10,613 50,259 Franchise fees 4,327 - - - - - - 4,327 Licenses & permits 2,964 - - 168 - - - 3,132 Intergovernmental 5,814 1,280 923 4,002 180 - 4,241 16,440 Charges for services 458 - 4,454 - 123 - - 5,035 Recovered costs 565 - - 943 245 - - 1,753 Fines & Forfeitures 1,558 - - - - - - 1,558 Interest 249 33 40 52 421 3 216 1,014 Memberships & donations - - 291 - - - - 291 Miscellaneous 148 69 121 91 - - 431 860 Total Revenues 60,690 1,382 5,829 5,256 969 3 15,501 89,630

EXPENDITURESCurrent expenditures: General government 13,571 - - - - 39 87 13,697 Public Safety 17,871 - - - - - 6,002 23,873 Public Works 17,286 - - - - - - 17,286 Parks and recreation - - - 6,666 - - - 6,666 Culture - - 9,788 - - - - 9,788 Human Services - 1,043 - - - - 3,726 4,769 Debt Service Principal - - - - - - 4,079 4,079 Interest - - - - - - 1,667 1,667 Capital Outlay 604 - - 34 9,279 - - 9,917 Total Expenditures 49,332 1,043 9,788 6,700 9,279 39 15,561 91,742

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES

11,358$ 339$ (3,959)$ (1,444)$ (8,310)$ (36)$ (60)$ (2,112)$

OTHER FINANCING SOURCES (USES)

Transfers in - 45 3,940 3,110 24,770 - 1,752 33,617 Transfers out (23,039) (809) - (3,728) (705) (570) (396) (29,247) Total other financing sources (uses) (23,039) (764) 3,940 (618) 24,065 (570) 1,356 4,370 NET CHANGE IN FUND BALANCES (11,681) (425) (19) (2,062) 15,755 (606) 1,296 2,258 FUND BALANCES, BEGINNING 32,739 7,519 304 2,509 29,550 4,883 21,245 98,749 PRIOR PERIOD ADJUSTMENT - - 332 3,383 - - - 3,715 FUND BALANCES, ENDING 21,058$ 7,094$ 617$ 3,830$ 45,305$ 4,277$ 22,541$ 104,722$

Primary Government


28


29

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL

FUNDS TO THE STATEMENT OF ACTIVITIES Year ended December 31, 2010

(in thousands)

Net change in fund balances – total government funds (page 28) $2,258 Governmental funds report capital outlays as expenditures. However in the statement of activities, the cost of those assets is allocated over their useful lives and reported as depreciation expense. This is the amount by which depreciation exceeded capital outlays in the current period. Capital outlay 9,917 Depreciation expense (9,815) Disposal of capital assets (263) Excess of depreciation expense over capital outlay (161) Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net assets. Repayment of debt principal is an expenditure in the governmental funds, but repayment reduces long-term liabilities in the statement of net assets. Issuing debt increases long-term liabilities and does not affect the statement of activities. Repayment of principal 4,078 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the governmental funds. Amortization of Bond Premium 102 Donated Art 77 Notes Receivable 4,333 Subtotal 4,512 Internal service funds are used by management to charge the costs of certain activities, such as risk management, vehicle replacement and maintenance, information technology replacement and the print shop services. A portion of the revenue (expense) of certain internal service funds is reported with governmental activities. (931) Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Amortization of Bond issuance costs (69) OPEB (462) Interest Expense 88 Compensated absences (45) Subtotal (488)

Change in net assets of governmental activities (page 25) $ 9,268



GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN

FUND BALANCE – BUDGET AND ACTUAL Year Ended December 31, 2010

(in thousands) Variance

With FinalBudget

Actual PositiveOriginal Final Amounts (Negative)

REVENUES Property and ownership taxes 5,054$ 5,054$ 4,961$ (93)$ Sales and use taxes 36,953 39,060 39,646 586 Franchise fees 4,473 4,473 4,327 (146) Licenses and permits 1,871 2,426 2,964 538 Intergovernmental 4,808 4,706 5,814 1,108 Charges for services 357 438 458 20 Recovered costs 200 285 565 280 Fines and forfeitures 1,648 1,648 1,558 (90) Interest 300 485 249 (236) Administrative services 5,658 5,658 5,583 (75) Miscellaneous 89 89 148 59 Total revenues 61,411 64,322 66,273 1,951 EXPENDITURES Current expenditures: Fund administration 2,269 9,927 5,291 4,636 Legislative 303 311 289 22 Judicial 915 918 846 72 Management 2,421 2,472 2,196 276 Legal 1,354 1,354 1,324 30 Finance 2,725 2,780 2,713 67 Human resources 1,272 1,419 1,341 78 Public safety 19,435 19,576 17,871 1,705 Public works 17,477 18,373 17,286 1,087 Planning 2,229 2,311 2,221 90 Information technology 3,050 3,050 2,933 117 Total current expenditures 53,450 62,491 54,311 8,180 Capital outlay 36 98 604 (506) Total expenditures 53,486 62,589 54,915 7,674 EXCESS OF REVENUES OVER EXPENDITURES 7,925 1,733 11,358 9,625

OTHER FINANCING SOURCES (USES) Transfers out (10,750) (21,795) (23,039) (1,244) Total other financing (uses) (10,750) (21,795) (23,039) (1,244) NET CHANGE IN FUND BALANCE (2,825) (20,062) (11,681) 8,381 FUND BALANCE, BEGINNING 26,520 32,739 32,739 - FUND BALANCE, ENDING 23,695$ 12,677$ 21,058$ 8,381$

Total expenditures as presented on budgetary basis 54,915$ plus allocation of internal transfers (5,583)Total expenditures as presented on GAAP basis 49,332$

Budgeted Amounts


30


COMMUNITY DEVELOPMENT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN


(in thousands)

VarianceWith Final

BudgetActual Positive

Original Final Amount (Negative)

REVENUES Intergovernmental 638$ 1,238$ 1,280$ 42$ Interest 20 20 33 13 Miscellaneous 108 108 69 (39) Total revenues 766 1,366 1,382 16 EXPENDITURES Current expenditures: Human Services 1,235 1,235 1,043 192 Total expenditures 1,235 1,235 1,043 192 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (469) 131 339 208 OTHER FINANCING SOURCES (USES) Transfers in 45 45 45 - Transfers out (193) (793) (809) (16) Total other financing sources (148) (748) (764) (16) NET CHANGE IN FUND BALANCE (617) (617) (425) 192 FUND BALANCE, BEGINNING 5,561 7,519 7,519 - FUND BALANCE, ENDING 4,944$ 6,902$ 7,094$ 192$

Budgeted Amounts


31


ARVADA CENTER FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN


(in thousands) Variance

With FinalBudget

Actual PositiveOriginal Final Amounts (Negative)

REVENUESIntergovernmental revenues Scientific and Cultural Facilities District 987$ 987$ $ 913 (74)$ State and local 5 5 10 5 Charges for services Performing Arts 3,558 4,161 3,453 (708) Education 946 946 843 (103) Gallery/Museum 150 150 158 8 Interest - - 40 40 Memberships and donations 631 631 291 (340) Miscellaneous 168 168 121 (47)

Total revenues 6,445 7,048 5,829 (1,219)

EXPENDITURES Current expenditures: Administration 476 506 498 8 Performing Arts 5,378 5,706 5,438 268 Development 212 225 214 11 Marketing 1,345 1,427 1,360 67 Education 1,459 1,548 1,475 73 Gallery/Museum 558 592 565 27 Facilities 236 250 238 12 Total current expenditures 9,664 10,254 9,788 466

Capital outlay 13 13 - 13

Total expenditures 9,677 10,267 9,788 479

DEFICIENCY OF REVENUES (3,232) (3,219) (3,959) (740) UNDER EXPENDITURES

OTHER FINANCING SOURCES Transfers in 3,235 3,940 3,940 -

Total other financing sources 3,235 3,940 3,940 -

NET CHANGE IN FUND BALANCE 3 721 (19) (740)

FUND BALANCE, BEGINNING 138 304 304 - PRIOR PERIOD ADJUSTMENT - - 332 332 FUND BALANCE, ENDING 141$ 1,025$ 617$ (408)$

Budgeted Amounts

32The accompanying notes are an integral part of these financial statements.


33

PARKS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN


(in thousands)

VarianceWith Final


Original Final Amounts (Negative)REVENUES Licenses, permits & fees 43$ 43$ 168$ 125$ Intergovernmental revenues Jefferson County-Open Space 2,917 2,934 4,002 1,068 Recovered costs 823 823 943 120 Interest 95 95 52 (43) Miscellaneous 40 57 91 34

Total revenues 3,918 3,952 5,256 1,304

EXPENDITURES Current expenditures: Park maintenance 6,187 6,182 5,949 233 Park design 762 762 717 45

Total current expenditures 6,949 6,944 6,666 278

Capital outlay - 34 34 -

Total Expenditures 6,949 6,978 6,700 278

DEFICIENCY OF REVENUES (3,031) (3,026) (1,444) 1,582 UNDER EXPENDITURES

OTHER FINANCING SOURCES (USES) Transfers in 3,110 3,110 3,110 - Transfers out (15) (885) (3,728) (2,843)

Total other financing sources 3,095 2,225 (618) (2,843)

NET CHANGE IN FUND BALANCE 64 (801) (2,062) (1,261)

FUND BALANCE, BEGINNING 2,227 2,509 2,509 - PRIOR PERIOD ADJUSTMENT - - 3,383 3,383 FUND BALANCE, ENDING 2,291$ 1,708$ 3,830$ 2,122$

Budgeted Amounts



PROPRIETARY FUNDS STATEMENT OF NET ASSETS


Govern-mental

Activities

Water Fund

Waste-water fund

Storm-water Fund

Golf Course Food Service

Total Business

Type Activities


ASSETSCURRENT ASSETSCash and investments 59,987$ 9,326$ 10,460$ 182$ 855$ 80,810$ 25,408$ Cash with fiscal agent 25 - - - - 25 - Accounts receivable, net of allowance for uncollectibles 1,968 1,836 382 17 152 4,355 3 Accrued interest 139 21 23 1 2 186 51 Inventories 250 - - 93 32 375 206 Prepaid costs 52 8 - 93 3 156 19 Total current assets 62,421 11,191 10,865 386 1,044 85,907 25,687

NONCURRENT ASSETSDeferred charges 184 - - - - 184 - Land, water rights & construction in progress 30,786 5 628 4,230 - 35,649 - Property & equipment, net of accumulated depreciation 114,171 37,421 27,816 3,439 1,029 183,876 5,450 Total assets 207,562 48,617 39,309 8,055 2,073 305,616 31,137

LIABILITIESCURRENT LIABILITIESAccounts payable 851 725 59 111 64 1,810 404 Matured bonds & interest payable 25 - - - - 25 - Accrued interest 105 - - 22 - 127 - Contracts payable - 206 - - 206 - Accrued compensated absences 206 28 9 62 25 330 44 Serial bonds payable 1,630 - - - - 1,630 - Bond Premium 104 - - - - 104 - Claims payable - - - - - - 1,721 Capital lease payable - - - 228 - 228 96 Deferred revenue - - - 109 26 135 - Total current liabilities 2,921 959 68 532 115 4,595 2,265

NONCURRENT LIABILITIESSerial bonds payable 17,025 - - - - 17,025 - Bond Premium 938 - - - - 938 - Accrued compensated absences 206 28 9 62 25 330 45 Capital lease payable - - - 647 - 647 534 Total non-current liabilities 18,169 28 9 709 25 18,940 579 Total liabilities 21,090 987 77 1,241 140 23,535 2,844

NET ASSETSInvested in capital assets, net of related debt

125,260 37,426 28,444 6,794 1,029 198,953 4,820

Restricted 1,865 - - - - 1,865 - Unrestricted 59,347 10,204 10,788 20 904 81,263 23,473 Total net assets 186,472$ 47,630$ 39,232$ 6,814$ 1,933$ 282,081$ 28,293$

4,636 $ 286,717


Business-Type Activities

Adjustment to reflect the consolidation of internal service fund activities related to enterprise fundsNet Assets of business-type activities (page 23)

34


PROPRIETARY FUNDS STATEMENT OF REVENUES, EXPENSES, AND CHANGES

IN FUND NET ASSETS Year Ended December 31, 2010

(in thousands) Govern-mental

Activities

Water Fund

Waste-water fund

Storm-water Fund

Golf Course Food Service

Total Business

Type Activities


REVENUESSales 16,865$ -$ -$ 1,384$ 1,539$ 19,788$ -$ Licenses/permits & fees 13 - - - - 13 - Service charges & fees 292 9,904 3,099 2,497 - 15,792 9,485 Recovered costs - - - - - 257 Grants - - 64 - - 64 - Miscellaneous 80 - - 9 15 104 108 Total revenues 17,250 9,904 3,163 3,890 1,554 35,761 9,850

EXPENSESOperating & maintenance 14,337 7,343 832 3,678 1,546 27,736 - Administration 671 742 - - 41 1,454 3,314 Insurance premiums - - - - - - 536 Uninsured damages & claims - - - - - - 450 Repair & maintenance - - - - - - 2,361 Depreciation 3,448 1,079 457 213 51 5,248 1,098 Total expenses 18,456 9,164 1,289 3,891 1,638 34,438 7,759

OPERATING INCOME (LOSS) (1,206) 740 1,874 (1) (84) 1,323 2,091

NON-OPERATING REVENUES(EXPENSES)Interest income 676 95 112 3 8 894 220 Gain (loss) on sale of assets (110) (216) - - - (326) 22 Interest expense (697) - - (41) - (738) (28) Amortization 84 - - - - 84 - Total non-operating revenues (expenses) (47) (121) 112 (38) 8 (86) 214

INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS

(1,253) 619 1,986 (39) (76) 1,237 2,305

CAPITAL CONTRIBUTIONS 2,172 328 84 - - 2,584 - TRANSFERS IN 500 63 1 154 27 745 711 TRANSFERS OUT (91) (259) (1,772) (4) - (2,126) (3,700)

CHANGE IN NET ASSETS 1,328 751 299 111 (49) 2,440 (684)

NET ASSETS, BEGINNING 185,144 46,879 38,933 6,703 1,982 28,977 NET ASSETS, ENDING 186,472$ 47,630$ 39,232$ 6,814$ 1,933$ 28,293$

247 2,687$



Adjustment to reflect the consolidation of internal service fund activities related to enterprise fundsChange in Net Assets of business-type activities (page 25)

35


PROPRIETARY FUNDS STATEMENT OF CASH FLOWS Year Ended December 31, 2010

(in thousands)

36

Govern-mental

Activities

Water Fund

Waste-water fund

Storm-water Fund

Golf Course

Food Service

Total Business

Type Activities


Cash flows from operating activitiesCash received from external customers 17,240$ 9,852$ 3,194$ 3,894$ 1,400$ 35,580$ 373$ Cash received from internal customers - 79 79 9,494 Cash payments to external suppliers (9,127) (5,714) (451) (1,298) (712) (17,302) (3,201) Cash payments to internal suppliers (657) (427) (24) (384) (60) (1,551) (1,858) Cash payments to employees for services (5,130) (1,186) (332) (1,971) (845) (9,464) (1,958) Net cash provided (used ) by operating activities 2,327 2,525 2,387 241 (138) 7,342 2,850 Cash flows from non-capital financing activities

Transfers to other funds (91) (259) (1,772) (4) - (2,126) (3,700) Transfers from other funds 500 63 1 154 27 745 711 Net cash provided (used ) by non-capital financing activities 409 (196) (1,771) 150 27 (1,381) (2,989) Cash flows from capital & related financing activitiesCapital Contributions 1,786 232 - - - 2,018 - Purchase of capital assets (5,033) (1,355) (1,515) (51) (7) (7,961) (342) Payment of capital lease - - - - - - (91) Principal paid on capital debt (1,550) - - (221) - (1,771) - Interest paid on capital debt (712) - - (51) - (763) (28) Proceeds from sale of assets - - - - - - 62 Net cash provided (used) by capital and related financing activities (5,509) (1,123) (1,515) (323) (7) (8,477) (399) Cash flows from investing activitiesInterest on investments 676 95 112 3 8 894 220 Net cash provided by investing activities 676 95 112 3 8 894 220 Net increase (decrease) in cash and cash equivalents (2,097) 1,301 (787) 71 (110) (1,622) (318) Cash and cash equivalents January 1, 2010 62,109 8,025 11,247 111 965 82,457 25,726 Cash and cash equivalents December 31, 2010 60,012 9,326 10,460 182 855 80,835 25,408 Reconciliation of operating income (loss) to net cash provided (used) by operating activities:

Operating income (loss) (1,206) 740 1,874 (1) (84) 1,323 2,091 Adjustments to reconcile operating income to net cash provided (used) by operating activities:Depreciation 3,448 1,079 457 213 51 5,248 1,098 (Increase) decrease in account receivable (151) (52) 26 4 (75) (248) (3) (Increase) decrease in inventories - - - (2) (2) (4) (11) (Increase) decrease in prepaid expenditures 1 - - 1 - 2 44 (Increase) decrease in accrued interest income 38 1 5 (1) - 43 19 (Decrease) increase in accounts payable 147 754 39 11 8 959 (36) (Decrease) increase in claims/bonds payable - - - - - - (339) (Decrease) increase in deferred revenue - - - 18 (32) (14) - (Decrease) increase in accrued benefits 50 3 (14) (2) (4) 33 (13) Net cash provided (used) by operating activities 2,327$ 2,525$ 2,387$ 241$ (138)$ 7,342$ 2,850$ Non-cash investing, capital and financing activitiesDeveloper Contributions 386$ 96$ 84$ -$ -$ 566$ -$ Capital Lease -$ -$ -$ -$ -$ -$ 41$




37

FIDUCIARY FUNDS STATEMENT OF FIDUCIARY NET ASSETS


Defined Benefit Police Agency Pension Fund ASSETS Pooled cash & investments $ 56 $ 4,111 Local Government Investment Pool 353 - Accrued interest - 8 Accounts receivable - 1,865 Total assets 409 5,984 LIABILITIES Escrow payable - 5.984 Total liabilities - 5,984 NET ASSETS HELD IN TRUST FOR PENSION BENEFITS $ 409 $ -



38

FIDUCIARY FUNDS STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS


Defined Benefit Police Pension ADDITIONS Investment income $ 1 Total additions 1 DEDUCTIONS Benefits paid 29 Total deductions 29 NET (DECREASE) (28) NET ASSETS HELD IN TRUST FOR PENSION BENEFITS BEGINNING OF YEAR $ 437 END OF YEAR $ 409


CITY OF ARVADA, COLORADO NOTES TO FINANCIAL STATEMENTS

December 31, 2010

39

TABLE OF CONTENTS 1. Summary of Significant Accounting Policies A. Financial Reporting Entity........................................................................................... 41

Blended Component Units ................................................................................... 41

Discrete Component Units ..............................................................................41-42

B. Government-Wide and Fund Financial Statements ..............................................42-43

C. Financial Statement Presentation .........................................................................43-45

D. Assets, Liabilities and Equity

1. Deposits and Investments.................................................................................... 45

2. Receivables and Payables................................................................................... 46

3. Inventories and Prepaid Items ............................................................................. 46

4. Restricted Assets ................................................................................................. 46

5. Capital Assets .................................................................................................46-47

6. Compensated Absences...................................................................................... 47

7. Long-Term Obligations ........................................................................................ 47

8. Fund Equity .....................................................................................................47-48

9. Net Assets............................................................................................................ 48

10. Estimates ............................................................................................................. 48

2. Stewardship, Compliance and Accountability

A. Budgetary Information ................................................................................................ 48

B. Expenditures/Expenses in Excess of Appropriation................................................... 49

C. State Constitutional Amendment................................................................................ 49

3. Detailed Notes on All Funds and Account Groups

A. Deposits and Investments .....................................................................................50-53

B. Capital Assets........................................................................................................54-55

C. Construction Commitments ........................................................................................ 55

D. Interfund Transactions...........................................................................................55-56

E. Long-Term Debt

Revenue Bonds...............................................................................................57-58

Capital Lease Obligations ...............................................................................58-61

Changes in General Long-Term Liabilities .......................................................... 61


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40

4. Other Information

A. Risk Management....................................................................................................... 62

B. Commitments and Contingencies

1. Litigation............................................................................................................... 63

2. Federal Grants ..................................................................................................... 63

3. Commitments ....................................................................................................... 63

4. AURA Commitments.......................................................................................63-64

C. Conduit Debt Obligation ........................................................................................64-65

D. Retirement Commitments

1. Defined Benefit Police Pension Plan ................................................................... 65

2. City of Arvada Retirement Plan – Defined Contribution Plan .............................. 66

3. Defined Contribution Police Pension Plan ......................................................66-67

4. Executive Retirement Plan................................................................................... 67

E. OPEB.......................................................................................................................67-68

F. Prior Period Adjustments .............................................................................................. 69

G. Related Party Note ....................................................................................................... 69


December 31, 2010

41

1. Summary of Significant Accounting Policies

This is a summary of significant accounting policies for the City of Arvada, Colorado presented to

assist the reader in interpreting the financial statements and other data in this report. The policies are considered essential and should be read in conjunction with the accompanying financial statements.

A. Financial Reporting Entity

The City of Arvada is a political subdivision of the State of Colorado, located in Jefferson and Adams Counties in the Northwest quadrant of the greater Denver, Colorado, metropolitan area. The population of the City is approximately 108,539. The City, incorporated in 1904, provides general government; police services; water; sewer, stormwater; golf; the Arvada Center for the Arts and Humanities; park maintenance; food service; and various trust and agency functions in a fiduciary capacity. The City does not provide fire protection, public education, or solid waste services. An elected mayor and six-member council govern the City. As required by accounting principles generally accepted in the United States of America (US GAAP) these financial statements present the City and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities are, in substance, part of the City's operations and data from these units are combined with data of the City. The discretely presented component units, on the other hand, are reported in separate columns in the government-wide statements to emphasize they are legally separate from the City. Each blended and discretely presented component unit has a December 31 year-end. Blended Component Units Arvada Housing Authority (Special Revenue Fund) – The Authority administers funds received for rent subsidy to low/moderate income households under Section 8 of the U.S. Housing Assistance Payment Program. The City provides all administrative support to the Authority. The Authority, a legally separate entity, is governed by a Board of Directors, which consists of all current members of the Arvada City Council. Separate audited financial statements for the Arvada Housing Authority are not prepared. Arvada Council of the Arts and Humanities (Arts Council) (Special Revenue Fund) – The Arts Council is a registered 501(c) 3 organization. Its role is to advise the Arvada City Council, provide guidance and support to the Arvada Center staff and act as an advocate for public support and funding for the Arvada Center. Separate audited financial statements for the Arts Council are not prepared. Discrete Component Units Arvada Urban Renewal Authority (AURA) – AURA is reported in a separate column as a discrete component unit presentation to emphasize that it is legally separate from the City. AURA was created by Ordinance No. 1717 under the Colorado Urban Renewal Law and was approved by the voters on March 3, 1981. Its purpose is to develop, redevelop or rehabilitate blighted areas of the City. AURA currently has five active project areas, Ralston Fields, JCMD, Village Commons, Olde Town Station and Northwest Arvada. The governing body of the Authority is a commission of seven members, appointed by the Mayor and approved by City Council for staggered terms of five years. AURA's annual budget must be approved by the City Council and the City provides administrative support to the Authority.


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42

AURA is included in the City's financial statements due to the City's ability to appoint AURA's governing authority and approve the budget and its revisions. The City does not have any responsibilities to fund AURA operating deficiencies or deficits. Tax revenues are imposed and collected by the City. Separate audited financial statements for AURA may be obtained from the City. Arvada Economic Development Association (AEDA) – AEDA is reported in a separate column as a discrete component unit presentation to emphasize that it is legally separate from the City. AEDA financial statements consist of one governmental fund. AEDA was established to encourage and stimulate all forms of economic development, commercial and industrial. The services provided by AEDA benefit both the City and citizens by providing information and services to existing and prospective businesses and industries. Funding for AEDA consists of compensation from the City for services it renders the City and its citizens. The City also provides administrative support for AEDA. A Board of Directors appointed by City Council governs AEDA. AEDA is included in the City's financial statements due to the City's ability to appoint AEDA's governing board. Separate audited financial statements for AEDA are not available.

B. Government-Wide and Fund Financial Statements

The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all the non-fiduciary activities of the City and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which are normally supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. Likewise, the City is reported separately from certain legally separate component units for which the primary government is financially accountable. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major enterprise funds are reported as separate columns in the fund financial statements. Measurement Focus and Basis of Accounting The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and trust fund financial statements. Revenues are recorded when earned and expenses are recorded


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when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Government fund financial statements are reported using the current financial resources measurement focus and modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and judgments, are recorded only when payment is due. Taxes, franchise fees, licenses, and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government. Agency funds use the accrual basis of accounting.

C. Financial Statement Presentation

The accounts of the City are organized and operated on the basis of funds, each of which is considered a separate accounting entity. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses as appropriate. The various funds are summarized by type within the financial statements. The City reports the following major governmental funds: The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Community Development Fund accounts for all entitlements, revenues and expenditures of the Community Development Block Grants (CDBG) program and the Home Rehabilitation program and Essential Home Repairs program. The Arvada Center Fund accounts for all revenues and expenditures of the Arvada Center for the Arts and Humanities. The Parks Fund accounts for costs associated with the acquisition, design, development, maintenance and beautification of parks, open space and trails within the City. Revenues are derived from the City’s General Fund, Grants Fund, Lands Dedicated Fund and Jefferson County Open Space funds. The General Capital Projects Fund accounts for all major capital projects of the City. Appropriations are not restricted to a fiscal year. Sources of revenue to this fund are transfers from contributions from the General and other funds, interest earned, transfers from Jefferson County Open Space funds and contributions by developers and government grants.


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The Construction Fund accounts for proceeds from the Series 2005 COP Bond issue to be used for Stormwater drainage improvements, Water main line replacements, and an expansion of the Arvada Center for the Arts and Humanities and for the remaining proceeds from the 1999 Sales and Use Tax Bond issue. The City reports the following major proprietary funds: The Water Fund accounts for all activity within the scope of water utility operations. Water service is available within the City limits and is extended to some residents of the county and adjacent cities. All activities necessary to provide such service are accounted for in this fund, including administration, operations, capital water projects, maintenance, financing and related debt service, and billing and collection. The Wastewater Fund accounts for all activities necessary in the collection, transmission, and disposal of sewage and wastewater. It includes administration, operations, capital maintenance, financing and billing and collection. The Stormwater Fund accounts for all activities necessary to maintain a stormwater management plan. In includes administration, operations, capital maintenance and billing and collection. The Golf Course Fund accounts for all revenues and expenses of the Lake Arbor and West Woods Golf Courses, including food service operations. It includes administrative, operations, maintenance, financing and related debt service at Lake Arbor and West Woods Golf Courses. Food service activities include restaurant operations at the West Woods and Lake Arbor Golf Courses. The Food Service Fund accounts for all revenue and expenses associated with food service activities including the operation of banquet facilities at the Arvada Center for the Arts and Humanities and offsite catering. Government and enterprise fund types that do not meet the criteria of major funds have been summarized and presented as other governmental funds and other enterprise funds, respectively within the fund financial statements. Additionally, the City reports the following fund types: Internal Service Funds are used to account for the City’s fleet and information technology replacement, risk management insurance program, printing services and building and fleet maintenance services. The City reports the following fiduciary funds: The Pension Trust Fund is used to account for the City’s defined benefit police pension trust to provide retirement benefits for one retiree that did not elect to join the new plan formed in 1986. Agency Fund is used to account for a variety of deposits from various sources held in escrow. All Governmental Accounting Standards Board (GASBs) pronouncements as well as all Financial Accounting Standards Board (FASBs) issued prior to November 30, 1989, are generally followed in the government-wide and proprietary fund financial statements, unless those pronouncements conflict or contradict guidance of GASB pronouncements. Governments have the option of following subsequent private-sector guidance for their business-type activities and enterprise


December 31, 2010

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funds, subject to this same limitation. The City has elected not to follow subsequent private-sector guidance. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this rule are the charges between the City’s enterprise operations and various other functions. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. Operating expenses for enterprise and internal service funds include cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. When both restricted and unrestricted resources are available, it is the City’s practice to use restricted resources first, then unrestricted resources as they are needed.

D. Assets, Liabilities and Equity 1) Deposits and Investments

The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. The City pools cash resources of most funds to facilitate the management of cash. Cash applicable to a particular fund is readily identifiable. The balance in the pooled cash accounts is available to meet current operating requirements. Cash in excess of current requirements is invested in various interest-bearing securities and disclosed as part of the City's investments. Cash overdrafts from pooled cash and investments are reported as an interfund receivable/payable. Colorado statutes require that the City use an eligible public depository as defined by the Public Deposit Protection Act (PDPA). Under the Act, the depository is required to pledge a pool of eligible collateral having a market value at all times equal to at least 102% of the aggregate public deposits held by the depository not insured by Federal Depository Insurance. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. Each institution designated as a public depository can be assessed a portion of the losses of a public entity's deposits in a failed public depository. Thus, all public deposits are fully collateralized. Eligible collateral as defined by the Act primarily includes obligations of, or guaranteed by, the U.S. Government, the State of Colorado or any subdivision thereof and obligations evidenced by notes received by first lien mortgages or deeds of trust on real property. Investments are reported at fair value. The fair value of the City’s investments is based upon values provided from quoted market prices.


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2) Receivables and Payables

Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "interfund receivables/payables" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as "due to/from other funds". On the Statement of Net Assets, residual balances between governmental and business type activities are reflected as internal balances. Receivables are shown net of an allowance for collectibles, where applicable. Property taxes attach an enforceable lien on the property as of January 1 and are levied of the following January 1. Taxes are payable the following year in one installment made on or before April 30, or in two installments made on or before February 28 and June 15. The assessments and collections are made by Jefferson County and Adams County and are remitted monthly to the City. City property tax revenues certified in December are recorded as a receivable and an offsetting deferred revenue. The City records non-current receivables for interfund and other long-term notes on the Statement of Net Assets of its Proprietary Fund Types. Within the governmental funds, all non-current receivables are fully offset by deferred revenue if the payment resulting in the receivable was originally recorded as an expenditure. Otherwise non-current receivables are fully offset by a reservation of fund balance. Non-current receivables and other long-term notes are shown on the statement of net assets of the government-wide statements.

3) Inventories and Prepaid Items

Inventories are valued at cost using the first-in/first-out (FIFO) method with the exception of the City's central supply inventory which is valued at average cost. The cost of inventories is recorded as expenditures when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid costs in both government-wide and fund financial statements.

4) Restricted Assets

The City applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available. Certain assets of the Community Development Block Grant special revenue fund are restricted because their use is completely restricted by grant agreements. Certain assets of the Arvada Center special revenue fund are restricted because their use is restricted by actor agreements.

5) Capital Assets

Capital assets which include property, plant, equipment, and all infrastructure assets (e.g. roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities column in the government-wide financial statements and in the Proprietary Funds in the fund financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of three years. Such assets are recorded at historical costs or estimated historical cost if purchased or constructed. Donated assets are recorded at estimated fair market value at the date of donation.


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The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Capital assets other than land and water rights are depreciated. Depreciation is computed using the straight-line method with estimated useful lives as follows: Assets Years Buildings 50 Road system infrastructure 25 Other improvements 20 Other infrastructure 8-50 Equipment 5-10 Vehicles 3-5

6) Compensated Absences

It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay benefits. No liability is reported for unpaid accumulated sick leave since benefits are not paid upon termination. Vacation pay is accrued when earned in the government-wide; proprietary and fiduciary fund financial statements. The compensated absences are only reported in governmental funds if they are due. Compensated absences of the governmental activities are expected to be liquidated primarily with revenues of the General Fund.

7) Long-Term Obligations

In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net assets. Debt premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the debt using the effective interest method. Debts payable are reported net of the applicable debt premium or discount. Debt issuance costs are reported as deferred charges and amortized over the term of the related debt. In the fund financial statements, governmental fund types recognize debt premiums and discounts, as well as debt issuance costs, during the current period. The face amount of the debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

8) Fund Equity

In the fund financial statements, fund equity of the City’s governmental funds are classified either as reserved or unreserved. Reserved fund balances indicates an amount of fund equity which is legally required to be segregated in accordance with legal and contractual provisions or not available as current financial resources. The unreserved fund equity represents the amount available for budgeting future operations. The unreserved portion may be further classified as either designated or undesignated. Designated unreserved fund balances represent amounts identified by management for future budgetary use of current resources. The General Fund designation is to balance the


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2011 budget. Designations of fund balance represent tentative management plans that are subject to change.

9) Net Assets

Net assets represent the difference between assets and liabilities. Net assets invested in capital assets, net of related debt consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowing used for the acquisition or construction of improvements of those assets. Net assets are reported as restricted when there are limitations imposed on their use either through the enabling legislation adopted by the City or through external restriction imposed by creditors, grantors, laws, or regulations of other governments. In November, 1992, Colorado voters passed Article X, Section 20 to the State Constitution, described in Note 2B. The Amendment requires that a percentage of fiscal year spending, excluding bonded debt service, be legally restricted to be used for declared emergencies only. This amount is reflected on the government-wide statement of net assets as net assets – reserved for emergencies. The amendment requires a three percent emergency reserve at December 31, 1995 and thereafter. An emergency is defined in the Amendment as an event, which excludes economic conditions, revenue shortfalls, salary or fringe benefit increases.

10) Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

2. Stewardship, Compliance and Accountability A. Budgetary Information

Annual budgets are adopted on a basis consistent with US GAAP for all governmental funds except the capital projects fund, which adopts project-length budgets. All other annual appropriations lapse at fiscal year end. Proprietary Funds are budgeted on a non-GAAP basis due to the budgeting of capital outlay and not depreciation. Budgetary financial statements do not include the general Capital Projects Fund because the projects accounted for in that fund span multiple years. Budgets are also not adopted for the Fiduciary funds. Not less than sixty days prior to the first day of the next fiscal year, Council adopts the City budget by resolution and the annual appropriation by ordinance. The City prepares a combination line item and program budget, but the level of control is at the fund level which is the amount approved by ordinance. For budgetary, appropriation and reporting purposes, interfund transfers are considered to be revenues or expenditures. Both the adopted budget and the level of appropriation (by fund) can be amended during the budget year. This action requires Council approval in the form of a resolution for a budgetary amendment and by ordinance requiring a public hearing for an increase in appropriations. Intrafund budgetary transfers between departments within a fund can be accomplished with the approval of the Manager.


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B. Expenditures/Expenses in Excess of Appropriation Expenditures exceeded appropriations in the Debt Service Fund by $311,945 and the Parks Fund by $2,565,000.

C. State Constitutional Amendment On November 3, 1992, the voters of the State approved Article X, Section 20 to the State Constitution (the Amendment) limiting growth of public entities and their ability to borrow and tax. Enterprises, defined as government-owned businesses authorized to issue revenue bonds and receiving less than 10% of its annual revenue in grants from all state and local governments combined, are excluded from the provisions of the Amendment. The City's management is of the opinion that it’s Water, Wastewater, Stormwater and Food Service operations qualify for this exclusion. The initial revenue base is 1992 fiscal year spending. Future revenue limits are determined based upon the prior year's fiscal year spending adjusted for a growth factor based upon inflation and changes in the actual value of real property within its boundaries. Excluded revenues such as gifts and federal funds are not used to calculate the limit. Revenue in excess of the limit must be refunded unless the voters approve retention of such revenue. On November 5, 1996, the qualified electors of the City approved Resolution R-96-127, which reads as follows:

Without creating any new tax or increasing any current taxes, shall the City of Arvada be permitted, in 1996 and each year thereafter, to retain and spend City revenues in excess of the spending, revenue raising, or other limits in Article X, Section 20 or the Colorado Constitution, utilizing such revenues for public safety, municipal services, transportation and other public improvements, parks and recreational facilities, and any other lawful public purpose?

The Amendment requires, with certain exceptions, voter approval prior to imposing new taxes, increasing a tax rate, imposing a mill levy that will produce property tax revenue in excess of the amount collected in the previous year adjusted by the growth factor, extending an expiring tax, or implementing a tax policy change which directly causes a net tax revenue gain. Except for bond refinancing at lower interest rates or adding employees to existing pension plans, the Amendment specifically prohibits the creation of multiple fiscal year debt or other financial obligations without voter approval and without irrevocably pledging present cash reserves for all future payments. The City believes it is in compliance with the requirements of the Amendment. However, due to the broad general terms of the Amendment, the City has been required to make certain interpretations of the Amendment's language in order to determine its compliance. Ultimately, the courts may be required to determine the appropriate interpretations of the Amendment's terms and provisions.


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3. Detailed Notes on Funds and Account Balances

A. Deposits and Investments As of December 31, 2010, the City's cash deposits had a carrying value of $28,089,672. The bank balances were $29,774,547 of which $1,086,337 was covered by federal deposit insurance and $28,688,210 was collateralized with securities held by the pledging financial institution’s trust department or agent in the City’s name. Investment policies are governed by the City’s investment policies and procedures and State Statutes. Investments of the City and AEDA may include:

• Local government investment pools authorized under the laws of the State of Colorado whose investment policy closely mirrors that of the City.

• Direct obligations of the United State government, including such instruments as Treasury Bills, Treasury Notes, Treasury Bonds, Export Import Bank issues, Farmers Home Administration Insured Notes, certain scaled discount notes, and certain relatively short-term securities issued by the Government National Mortgage Association.

• Obligations of certain U.S. Government agencies, including but not limited to such instruments as Federal Home Loan Bank debt, Federal National Mortgage Association debt, certain scaled discount notes, and/or certain short-term Federal Farm Credit debt.

• Purchases of the direct or agency securities mentioned above, under the terms of a repurchase agreement or in support of a City “Sweep Account” which meet the City’s procedures for the delivery, possession and safekeeping of investment securities.

• Repurchase agreements • Commercial paper and certificates of deposits • AAA-rated money market funds

Investments of the employee pension plans are determined contractually with the third-party custodian. The plans currently contain a wide range of money market and mutual funds and are not subject to the City’s investment policies. Interest Rate Risk The City’s investment policy does not specifically address Interest Rate Risk. The State Statutes requires 3 or 5 years depending on the investment. In practice, the City does not purchase any investments with a maturity of longer than 5 years with all “money market instruments” having a maturity of one year or less. The City assumes its investments will be held to maturity and callable investments may or may not be called. Credit Risk The City’s general investment policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital, and, in general, avoid speculative investments. The State Statutes specify rating requirements depending on the investment. All corporate bonds have AA or higher ratings. Concentration of Credit Risk As a means of limiting its exposure, the City’s total investment in any specific money market or mutual fund shall not exceed 10% of the total assets of such fund class. At December 31,


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2010, the City's investments in the FHLB, FHLMC, FNMA, and FFCB are 18.83%, 8.13%, 8.08% and 12.5% of total investments, respectively. Custodial Credit Risk Custodial credit risk is the risk that in the event of a bank failure, the government’s deposits may not be returned to it. The City’s investment policy requires commercial banks and savings and loan associations to be eligible public depositories within the meaning of the Colorado Revised Statues of PDPA and S&L PDPA. The depositories will also have to posses overall financial strength, capitalization and liquidity to ensure the safety and availability of such monies. The assessment of this overall financial strength will be rated by the Prudent Man Analysis, Inc (PMA). Inasmuch as PMA utilizes overall rating of 1 through 5, (1 being strongest….5 being weakest), the City’s policy is to seek commercial banks with an overall PMA rating of 1 or 2. In the event that Prudent Man Analysis (PMA) services are not available, then the City may, upon written approval from the City manager or his/her designee, utilize other third-party agencies. Local Government Investment Pool At December 31, 2010, the City had invested in both the Colorado Local Government Liquid Asset Trust (Colotrust) and the Colorado Surplus Asset Fund Trust (CSAFE). These investment vehicles were established for local government entities in Colorado to pool surplus funds. The State Securities Commissioner administers and enforces the requirements of creating and operating these pools. Their operation is similar to a money market fund with each share equal in value to $1.00. Investments of these entities are limited to those allowed by State statutes. A designated custodial bank provides safekeeping and depository services in connection with the direct investment and withdrawal functions. Substantially all securities owned are held by the Federal Reserve Bank in the account maintained for the custodial bank. The custodian's internal records identify the investments owned by the participating governments. Cash and Investments reported on the financial statements as of December 31, 2010: Cash and Investments $ 206,311 Restricted Cash 1,746 Cash with fiscal agent 25 Total per Statement of Net Assets $ 208,082 Agency Fund 4,111 Police Pension Defined Benefit 409 Total Financial Statement Cash & Investments $ 212,602 Carrying value of cash 28,090 Fair market value of investments 184,512 Total value cash and investments $ 212,602


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AURA Investment Policy Investments The Authority is required to comply with State statutes which specify instruments meeting defined rating, maturity, and concentration risk criteria in which units of local government may invest. In addition, the Authority has an investment policy in which seeks to ensure the preservation of capital in the overall portfolio. Per the Authority’s investment policy, funds of the Authority may be invested in: • U.S. Treasury Securities. • Obligations of the U.S. Government agencies (including FDIC and FSLIC insured

transactions up to $100,000). • Certificates of deposit and other evidences of deposit or investment at banks, savings

and loan associations and other state or federally regulated financial institutions subject to PDPA (5%) and a minimum net worth of any bank of $10,000,000 and a minimum net worth of any savings and loan association of $15,000,000.

• Repurchase agreements made in compliance with Revised Colorado State Statute 24-36-113. Repurchase collateral will be perfected and delivered to the Trustee. Repurchase agreements must be collateralized at a minimum of 100% of the purchase price of the repurchase agreement and market-to-market on a weekly basis. All repurchase agreements shall be evidenced by a master repurchase agreement between the Authority and securities dealer.

• Money market funds. Investments with any financial institutions which have appeared in any published watch list during a 12-month period preceding the investment date in an amount greater than $100,000 is specifically prohibited.

The Authority's investment policy follows State statutes, but places additional limits on investment maturities and custodial credit risk. Interest Rate Risk – The Authority's investment policy limits the maturity of investment instruments or fixed-income securities to a maximum of three years except for reserve funds which are invested subject to agreements tailored to bond indentures, when applicable. Investments in the Dreyfus Government Cash Management money market fund of $725,337 have a weighted average maturity of less than one year. Credit Risk – State statutes limit investments in money market funds to those that maintain a constant share price, with a maximum remaining maturity in accordance with Rule 2a-7, and either have assets of one billion dollars or the highest rating issued by a nationally recognized organization that regularly rates such obligations. At December 31, 2010, the Authority's investment in the Dreyfus Government Cash Management money market fund of $725,337 was rated AAA Moody’s. Custodial Credit Risk – The Authority's investment policy requires that investments be placed with two or more financial institutions and in such amounts or proportions of total investments or assets as may be reasonable and prudent. Concentration of Credit Risk – State statutes generally do not limit the amount the Authority may invest in one issuer.


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As of December 31, 2010, the City had the following investments and maturities:

>1 yr >2 yrs >3 yrs >4 yrsCredit and and and and

Asset Category Quality Fair Value <= 1 year <= 2 yrs. <= 3 yrs. <= 4 yrs. <= 5 yrs.

Local GovernmentInvestment PoolTrust Funds AAA 61,987,509 61,987,509 - - - -

U.S. Treasuries 7,155,960 - - 5,067,200 2,088,760 -

U.S. Agencies FHLB AAA 34,739,570 2,077,660 - 17,821,720 9,868,600 4,971,590 FHLMC AAA 15,005,450 - - - 9,986,750 5,018,700 FNMA AAA 14,917,250 - - 4,975,250 5,109,250 4,832,750 FFCB AAA 23,057,370 5,006,250 3,175,920 14,875,200 - -

Subtotal for U.S. Agencies 87,719,640 7,083,910 3,175,920 37,672,170 24,964,600 14,823,040

Corporate Bonds AAA 18,395,000 5,124,750 13,270,250 - - - AA 9,254,010 6,095,940 3,158,070 - - -

Subtotal for Corporate Bonds 27,649,010 11,220,690 16,428,320 - - -

Total for all Asset Categories 184,512,119 80,292,109 19,604,240 42,739,370 27,053,360 14,823,04043.52% 10.62% 23.16% 14.67% 8.03%

Investment Maturities

As of December 31, 2010 AURA’s cash deposits had carrying values of $1,105,269. The bank balances were $1,111,381 of which $428,519 was covered by the federal deposit insurance and $682,862 was collateralized with securities held by the pledging financial institution’s trust department or agent in AURA’s name. As of December 31, 2010 AEDA’s cash deposits had carrying values of $656,122. The bank balances were $656,122 of which $345,300 was covered by the federal deposit insurance and $310,822 was collateralized with securities held by the pledging financial institution’s trust department or agent in AEDA’s name

A summary of changes in capital asset activity for the year ended December 31, 2010 follows (in thousands):


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B. Capital Assets Balance Transfers Balance

January 1, To (From) December 31,2010

Additions Retirements CIP 2010

Primary Government:Governmental activitiesCapital assets not being depreciated:Land 49,026$ -$ -$ 2,501$ 51,527$ Construction in progress 27,109 9,279 (251) (28,621) 7,516 Total capital assets, not being depreciated 76,135 9,279 (251) (26,120) 59,043 Capital assets, being depreciated:Buildings 34,011 - (63) - 33,948 Improvements other than buildings 38,541 400 24,834 63,775 Equipment & Vehicles 23,255 620 (569) 23,306 Infrastructure 368,968 - - 1,286 370,254 Total capital assets being depreciated 464,775 1,020 (632) 26,120 491,283

Less accumulated depreciation for:Buildings (14,122) (913) 63 - (14,972) Improvements other than buildings (12,844) (1,379) 9 - (14,214) Equipment & Vehicles (16,751) (1,239) 509 - (17,481) Infrastructure (229,962) (7,382) - - (237,344) Total accumulated depreciation (273,679) (10,913) 581 - (284,011)

Total capital assets, being depreciated, net 191,096 (9,893) (51) 26,120 207,272

Governmental activities capital assets, net 267,231$ (614)$ (302)$ -$ 266,315$

Balance Transfers BalanceJanuary 1, To (From) December 31,

2010 Additions Retirements CIP 2010Business-type activitiesCapital assets not being depreciated:Water rights 26,374$ 856$ -$ -$ 27,230$ Land 7,695 - - - 7,695 Construction in progress 6,986 2,637 - (8,899) 724 Total capital assets, not being depreciated 41,055 3,493 - (8,899) 35,649

Capital assets, being depreciated:Buildings 14,638 - - - 14,638 Improvements other than buildings 229,454 4,922 (1,005) 2,898 236,269 Equipment & Vehicles 3,077 113 (29) 3,161 Infrastructure 843 - - 6,001 6,844 Total capital assets being depreciated 248,012 5,035 (1,034) 8,899 260,912

Less accumulated depreciation for:Buildings (6,696) (296) - - (6,992) Improvements other than buildings (64,360) (4,599) 679 - (68,280) Equipment & Vehicles (1,407) (326) 29 - (1,704) Infrastructure (33) (27) - - (60) Total accumulated depreciation (72,496) (5,248) 708 - (77,036)

Total capital assets, being depreciated, net 175,516 (213) (326) 8,899 183,876

Business-type activities capital assets, net 216,571$ 3,280$ (326)$ -$ 219,525$


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Depreciation expense was charged to functions/programs of the primary government as follows (in thousands):

Governmental Business-Type Activities Activities General government $1,534 $ - Public safety – police & judicial 90 - Public works 37 - Parks 7,782 - Culture 364 - Human Services 8 - Internal Service 1,098 - Water - 3,448 Wastewater - 1,079 Stormwater - 457 Golf - 213 Food - 51 Total depreciation expense $ 10,913 $ 5,248

C. Construction Commitments

The City has active construction projects as of December 31, 2010. The projects include street construction, parks construction water, and wastewater system projects. At year end the City’s commitments with contractors are as follows (in thousands):

Project Remaining Spent-to-Date Commitment Street construction $ 1,941 $ 209 Water construction 1,459 526 Wastewater construction 1,242 614 Parks construction 4,612 381 Total $ 9,254 $ 1,730 D. Interfund Transactions

There was one due from and one due to balance as of December 31, 2010. The Arvada Housing Authority owes the General Fund $37,298 for expenditures paid on its behalf. Transfers to/from other funds for the year ended December 31, 2010 were as follows (in thousands):

Fund Transfers In Transfers Out General Fund $ - $ 23,039 Community Development Fund 45 809 Arvada Center 3,940 - Parks 3,110 3,728 Capital Projects Fund 24,770 705 Construction Fund - 570 Non-major Governmental Funds 1,752 396 Water Fund 500 91 Wastewater Fund 63 259


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Stormwater Fund 1 1,772 Golf Course Fund 154 4 Food Service Fund 27 - Internal Service Funds 711 3,700 Total $35,073 $35,073

The General Fund transfers out include support transfers to the Arvada Center, Parks, Community Development, Golf Course and Food Service Funds, a capital transfer to the Capital Projects Fund, debt transfers to the Bond and COP Funds and the Building Fund for energy payments. The Community Development Fund transfer in is from the General Fund to meet operations and the transfer out is to the Housing Fund to offset administrative costs. The Arvada Center Fund transfer in is from the General Fund to meet operations. The Parks Fund transfer in is from the General Fund to meet operations. The transfer out is a capital transfer to the Capital Projects Fund. The Capital Projects Fund transfers in are for current and future capital projects. This year the General, Vehicles, Construction, Grants, Community Development, Insurance, Water and Stormwater Funds made transfers into the Capital Projects Fund. The Construction Fund transfer out is to the Capital Projects Fund for a future capital project. The Water Fund transfers out are to the Stormwater Fund for operations, the Capital Projects Fund for a non-enterprise asset and to the Central Services Fund for energy payments. The transfers in are from the Wastewater and Parks Funds for overhead. The Wastewater Fund transfer in is from the Stormwater Fund for overhead. The transfers out are to the Water Fund for overhead and the Building Fund for energy payments. The Stormwater Fund transfers out are to the Wastewater Fund for overhead, the Capital Projects Fund for a non-enterprise asset and the Bond Fund for payment of debt. The Golf Course Fund transfers in are from the General Fund to meet operations and capital projects. The transfers out are to the Building Fund for energy payments. The Food Service Fund transfer in is from the General Fund to meet operations. The Internal Service Funds transfers in are for the purchase of new vehicles and energy lease payments. The transfers out are one-time transfers from the Insurance Fund and the Vehicle Fund into the Capital Projects Fund.


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E. Long-term Debt

Revenue Bonds Governmental Activities Series 2009 Sales and Use Tax Refunding Revenue Bonds On May 20, 2009 the City advance refunded $12,975,000 and $8,250,000 of 1998 and 1999 Sales and Use Tax Refunding Revenue Bonds, respectively, with an issuance of $19,885,000 of Sales and Use Tax Refunding Bonds dated July 1, 2009, with interest rates varying from 2.5% to 4.0% payable semi-annually on June 1 and December 1. The bonds mature beginning in 2009 and continue through 2018. The bonds were issued for the purpose of advance refunding a portion of the City’s 1998 and 1999 Sales and Use Tax Revenue Refunding Bonds in order to realize interest savings. Bonds outstanding and related interest requirements as of December 31, 2010, are as follows (in thousands):

Year Ending December 31

Principal

Interest

Total

2011 1,775 553 2,328 2012 1,830 499 2,329 2013 1,890 435 2,325 2014 1,935 388 2,323 2015 1,990 340 2,330

2016-2018 8,035 653 8,688 Total $ 17,455 $ 2,868 $20,323

Series 2003 Sales and Use Tax Refunding Revenue Bonds On July 16, 2003, the City advance refunded $16,350,000 of the Series 1992 Sales and Use Tax Refunding and Improvement Revenue Bonds by the issuance of $16,955,000 of Sales and Use Tax Refunding Revenue Bonds dated July 1, 2003 with interest rates ranging from 2.0% to 4.0% payable semi-annually. The bonds mature beginning in 2005 and continue through 2017. Bonds outstanding and related interest requirements as of December 31, 2010, are as follows (in thousands):


Principal

Interest

Total

2011 1,325 378 1,703 2012 1,370 335 1,705 2013 1,420 289 1,709 2014 1,465 239 1,704 2015 1,520 186 1,706

2016-2017 3,220 195 3,415 Total $10,320 $ 1,622 $11,942

The 2003 and 2009 Sales and Use Tax Refunding Revenue Bonds are payable solely from the City’s 3% sales tax. The sales and use tax revenues allocated for repayment of these


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bonds is deposited separately into the Debt Fund. During the year ended December 31, 2010, revenues of $43,678,000 were available to pay annual debt service of $4,032,381. Business-type Activities Series 2009 Water Enterprise Revenue Refunding Bonds On April 24, 2009 the City currently refunded $22,615,000 of 2001 Variable Rate Demand Water Enterprise Bonds, with the issuance of $21,745,000 of Water Enterprise Revenue Refunding bonds dated May 1, 2009 with interest ranging from 2.0% to 5.0% payable semi-annually on May 1 and November 1. The bonds mature beginning in 2009 and continue through 2020. Annual debt service requirements for the outstanding bond at December 31, 2010, are as follows (in thousands):


Principal

Interest

Total

2011 1,630 635 2,265 2012 1,680 586 2,266 2013 1,730 535 2,265 2014 1,760 501 2,261 2015 1,805 457 2,262

2016-2020 10,050 1,258 11,308 Total $18,655 $3,972 $22,627

Series 2005 Certificates of Participation In July 27, 2005 the City issued Certificates of Participation in the amount of $18,505,000. The Certificates were dated July 1, 2005, with interest rates ranging from 2.75% to 4.35% payable semi-annually. The lease payments mature beginning in 2006 and continue through 2024.


Principal

Interest

Total

2011 820 580 1,400 2012 845 554 1,399 2013 880 520 1,400 2014 910 489 1,399 2015 945 456 1,401

2026-2020 5,300 1,696 6,996 2021-2024 5,055 537 5,592

Total $ 14,755 $ 4,832 $ 19,587 Capital Lease Obligations Governmental Activities In 2010, the City entered into a lease agreement for $40,460 for a 5-year period for the purchase of a printing press. The interest rate is 7.93%. Payments of both principal and interest are due monthly. Minimum required lease payments are as follows as of December 31, 2010 (in thousands):


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Year Ending December 31 2011 10

2012 10

2013 10

2014 10

2015 3

Total $ 43

Less amounts representing interest (7)

Present value of lease payments $ 36

In 2007, the City entered into a lease agreement for $13,363 for a 5-year period for the purchase of three utility vehicles. The interest rate is 4.75%. Payments of both principal and interest are due annually. Minimum required lease payments are as follows as of December 31, 2010 (in thousands):


Total $ 3


Present value of lease payments $ 2 In 2004, the city entered into a lease agreement for $1,005,093 for a 13-year period for an energy efficiency project. The interest rate is 3.99%. Payments for both principal and interest are due monthly in 2005 and quarterly thereafter. Minimum required lease payments are as follows as of December 31, 2010 (in thousands):

Year Ending December 31 2011 112 2012 113 2013 114 2014 115 2015 116 2016 101

Total $671


Present value of lease payments $595

In 1996, the City entered into a capital lease obligation for the expansion of West Woods Golf Course for $2,980,200. The commitment will be paid over a 15-year period in semi-annual installments. Under the ground lease, the City leases certain land used for the new nine-hole golf course. Until 2009, this lease was paid out of the Golf Course Fund through user fees


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and therefore was a liability of this fund. In 2009, the General Fund took over this liability from the Golf Course Fund and will continue to make the payments until the lease is paid off.

Minimum required lease payments are as follows as of December 31, 2010 (in thousands):


Total $155


Present value of lease payments $150 The total value of the governmental assets capitalized related to the capital leases net of related depreciation is $3,870,237. Business-type Activities In 2007, the City entered into a lease agreement for $481,315 for a 5-year period for the purchase of 175 golf carts. The interest rate is 4.75%. Payments of both principal and interest are due annually. Minimum required lease payments are as follows as of December 31, 2010 (in thousands):


Total $ 113



In 2006, the City entered into a lease agreement in the amount of $1,303,000 for a 10-year period for the replacement of the Lake Arbor Golf course irrigation system. The interest rate is 5.94%. Payments of both principal and interest are due semi-annually in January and July. Minimum required lease payments are as follows as of December 31, 2010 (in thousands):

Year Ending December 31 2011 158 2012 158 2013 158 2014 158 2015 158 2016 79

Total $869




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The total value of the business-type assets capitalized related to the capital leases net of related depreciation is $1,347,884. Changes in General Long-Term Liabilities – During the year ended December 31, 2010 the following changes occurred in liabilities reported in the governmental activities (including internal service funds), business type activities, and component units (in thousands):

Balance Additions Reductions Balance Due in Governmental Activities 01/01/2010 12/31/2010 1 yearRevenue Bonds 30,770$ -$ 2,995$ 27,775$ 3,100$ Bond Premium 907 - 102 805 102 Certificates of Participation 15,550 - 795 14,755 820 Capital Lease 1,121 40 378 783 249 OPEB 679 515 53 1,141 - Compensated Absences 4,025 2,176 2,144 4,057 2,029 Total Governmental 53,052$ 2,731$ 6,467$ 49,316$ 6,300$

Balance Additions Principal Balance Due in Business Type Activities 01/01/2010 12/31/2010 1 yearRevenue Bonds 20,205$ -$ 1,550$ 18,655$ 1,630$ Bond Premium 1,145 - 104 1,041 104 Capital Lease 1,093 - 218 875 228 Compensated Absences 627 390 356 661 330 Total Business Type 23,070$ 390$ 2,228$ 21,232$ 2,292$


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4. Other Information A. Risk Management

The City has established a risk management program for much of its insurance needs. It is self insured for occurrences of general liability and auto liability claims, which are subject to the Colorado Governmental Immunity Act which caps recoveries at $150,000 per person and $600,000 per accident. Property damage is subject to a $100,000 deductible and liability insurance a $250,000 deductible. The Workers’ Compensation program maintains a self-insured retention (SIR) limit of $350,000. There have been no settlements which exceed the Governmental Immunity Caps for general or auto liability in the last three years. No loss has been recorded in the last three years for the property program that exceeds the $100,000 deductible. Additionally, no claim or settlement in workers’ compensation has exceeded the SIR in the last three years. Premiums are paid by each department into the Insurance Fund (internal service) to pay claims, claim reserves and administrative costs of the program including premiums to commercial insurance companies for losses in excess of the self-insured amounts. The City also provides dental insurance for employees. Dental claims are limited to $1,000/year per person. Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported. Claim liabilities are calculated considering the effects of inflation, recent claim settlement trends including frequency and amount of payouts and other economic and social factors. The liability for claims and judgments is recorded in the internal service funds. Changes in the balances of claims liabilities during the past two years are as follows (in thousands):

Insurance Service

Unpaid Claims, January 1, 2009 $1,814

Incurred Claims 1,375

Claim Payments 1,129

Unpaid Claims, December 31, 2009 2,060

Incurred Claims 450

Claim Payments 789

Unpaid Claims, December 31, 2010 $1,721


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B. Commitments and Contingencies

1) Litigation The City is involved in pending litigation. The City anticipates no potential claims resulting

from these cases which would materially affect the financial statements of the City. 2) Federal Grants Federal grants are subject to audit which could result in disallowed costs, the amount which

is undeterminable at December 31, 2010. If any costs are disallowed in the future, the City expects them to be insignificant.

3) Commitments In October of 1997 and as amended in November of 2000, the City and DHI-64th & Indiana

entered into a sales tax incentive agreement. This agreement was for $2,901,246 and will have approximately $1,686,010 remaining at the end of 2010 after paying $83,295 in principal. The City is obligated to pay this balance off at a rate of 28% of all city sales tax generated by the area. This commitment will last until May 2013 or until paid off, whichever is sooner.

4) AURA Commitment

Developer Agreements The Authority receives incremental property taxes within the Ralston Fields area, as discussed in Note 1. In addition, a public improvement corporation (PIC) collects public improvement fees (PIF) within the area in substitution of a sales tax. In 2004, the Authority entered into a cooperation agreement among the following parties:

• Ridge Venture LLC (the Developer), • Retail Sales Operation, • Kipling Ridge Metropolitan District (the District), and • The City.

The purpose of this agreement is to accomplish the purposes of the Ralston Fields Urban Renewal Plan (the Plan). In this agreement, a portion of the incremental property tax revenues collected by the Authority and a portion of the PIF collected by the PIC are allocated to the City, the District, and the Retail Sales Operation, as follows: • The City: The Authority is to pay the City $100,000 a year for a continuing period of 18

consecutive years, which is passed through to the City of Wheat Ridge. This payment is for charges for municipal services incurred by the City of Wheat Ridge for property adjacent to the Ralston Fields Urban Renewal Area (the Area) arising from or out of the development activities that are necessary to implement the purposes of the Plan.

• The retail Sales Operation: The Authority and the PIC are to remit 25% of property taxes and PIF, respectively, derived from the Retail Sales Operation back to the Retail Sales Operation up to a maximum of $3 million. The agreement allows the Authority and the PIC to pay a maximum $500,000 per year until 2014 or when the $3 million is reached, whichever is earlier (Retail Sales Operation Reimbursement Period). As of December 31, 2010, $1,945,867 of the $3 million had been paid to the Retail Sales Operation.


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• The District: The Authority and the PIC are to remit to the District 60% of all property tax and PIF from the Area, excluding taxes derived from the Retail Sales Operation. Additionally, the Authority is to remit to the District another 45% of all sales and property tax revenue derived from the Retail Sales Operation up to the end of the Retail Sales Operation Reimbursement Period. After the Retail Sales Operation Reimbursement Period has expired, the Authority will remit to the District 60% of all property tax and PIF from the Area, inclusive of taxes derived from the Retail Sales Operation. Upon the earlier of (a) payment in full of the District’s outstanding bonds (bonds outstanding as of December 31, 2010, or $1,297,500) or (b) September 30, 2028, the Authority’s obligations to the District will terminate. As of December 31, 2010, $1,305,790 had been paid to the district.

Additionally, 100% of the ad valorem tax on real and personal property attributable to the District Mill Levy actually received by AURA shall be remitted to the District. Total amount remitted to the District related to the District Mill Levy during the year ended December 31, 2010 was $94,467. The District Mill Levy remitted by AURA to the District shall not be included in the totals of Property Tax payments as noted above.

On April 4, 2005, the Authority also entered into a Master Redevelopment Agreement with the Jefferson Center Metropolitan District No. 1 (JCMD No. 1) and the City. This agreement, and the obligations associated with this agreement, were assigned and assumed by Jefferson Center Metropolitan District No. 2 (JCMD) effective retroactively to April 4, 2005. On January 11, 2010 this agreement was Amended and Restated. The amended and restated agreement states that JCMD will bear the costs and expenses incurred in connection with the establishment of the Jefferson Center and Northwest Arvada Urban Renewal Areas and adoption of the Jefferson Center and Northwest Arvada Urban Renewal Plans. The Authority, subject to the terms and conditions set forth in the Amended and Restated Master Redevelopment Plan Agreement, is obligated to remit to JCMD and JCMD No. 1 the pledged revenues for use in financing project costs and any reimbursable expenditures in accordance with the agreement. Pledged revenues are equal to the total amount of incremental property and sales taxes received by the Authority which are available for payment to JCMD and reduced by the administrative fees of $150,000. Additionally, any City Property Tax Increment collected by the county and remitted to the Authority shall be utilized by the Authority in furtherance of urban renewal plans. With respect to the Jefferson Center Urban Renewal Plan, the Authority’s obligations under this agreement will terminate upon the earlier of (a) the payment in full of all JCMD obligations (bonds outstanding as of December 31, 2010, of $38,800,000), or (b) the date that is the 25th anniversary of the date of adoption of the Jefferson Center Urban Renewal Plan. With respect to the Northwest Arvada Urban Renewal Plan, the Authority’s obligations under this agreement will terminate upon the earlier of (a) the date payment is made in full of all JCMD obligations (bonds outstanding as of December 31, 2010, of $38,800,000), supported by Northwest Area Property Taxes or to which Northwest Area Property Taxes are pledged, or (b) the date that is the 25th anniversary of the date of adoption of the Jefferson Center Urban Renewal Plan. The agreement is expected to terminate in 2034. The Northwest Area Urban Renewal Area did not receive any tax revenue during the year ended December 31, 2010, as the area was established at the end of 2009.

C. Conduit Debt Obligation

From time to time, the City has issued Industrial/Mortgage Revenue Bonds, Mortgage Credit Certificates and Private Activity Bonds. Industrial Bonds are issued to provide financial assistance to private-sector entities for the acquisition and construction of industrial and


December 31, 2010

65

commercial facilities. Mortgage Bonds are issued to provide financial assistance to low and moderate income persons and families in the purchase of a home. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Upon repayment of the bonds, ownership of such property transfers to the person/family served by the bond issuance. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2010, there was 1 Industrial Revenue Bond, 1,002 single and multi-family Mortgage Bonds, 96 Mortgage Credit Certificates and 1 Private Activity Bond. The unpaid balance on the Industrial Revenue Bond is $3.5 million and on the Mortgage Bonds is $35.2 million. The unpaid balance on the Mortgage Credit Certificates is $7.8 million and on the Private Activity Bond is $25.5 million.

D. Retirement Commitments

The City has adopted separate retirement or pension plans (Plans) covering all employees, except those hired on a temporary basis. Although it has not expressed any intention to do so, the City has the right under the Plans to discontinue its contribution or to terminate the Plans. Should the Plans terminate at some future time, their net assets will be used to provide participants' benefits. Upon such termination, the assets of the Plans are to be allocated for the benefit of each participant and the beneficiary in a manner approved by the Internal Revenue Service. 1) Defined Benefit Police Pension Plan

The City has a single employer-defined benefit plan to cover the uniformed police officers that did not elect to participate in the Defined Contribution Police Pension Plan that became effective January 1, 1986. In 1986, single premium group annuities were purchased for the benefit of retired employees, beneficiaries and terminated vested employees. After January 1, 1986, all new uniformed police officers are participants in the Defined Contribution Police Pension Plan. One fully vested participant remains in the Defined Benefit Plan as of December 31, 2010. The participant began receiving retirement benefits in 1997, as defined by City ordinance. Contribution requirements of the plan were not actuarially determined and an actuary was not used to determine the actuarial implications. The Pension Board commissioned an actuarial valuation of the plan in the summer of 2006. The valuation determined that the assets of the plan, $558,000, exceeded the present value of the retirement obligation of $480,000 to the participating member at that time. As of December 31, 2010, the net assets held in trust were $409,000. No contributions have been made by the participant or the City for the years ended December 31, 2010, 2009 and 2008.


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2) City of Arvada Retirement Plan – Defined Contribution Plan

Effective January 1, 1993, all eligible City employees participate in the City of Arvada Retirement Plan (CARP), a defined contribution plan. All City full-time and part-time employees, except uniformed police officers, the City Manager, and his staff, the City Attorney and Department Heads who elect to participate in the Executive Retirement Plan, are eligible to participate in CARP. 499 employees were participants in the plan as of December 31, 2010. Employer contributions vest with the employee according to the following:

Years of Service Vesting Percentage Less than 1 year 0% 1 year 20% 2 years 40% 3 years 60% 4 years 80% 5 or more years 100%

The plan requires covered employees to contribute 8% of their salary to the plan and the City to contribute 10% of the compensation of all participants hired after April 2, 2004. Employees hired on or before April 2, 2004 had a choice of receiving a flat rate 10% contribution or receiving an age weighted, graduated retirement contribution up to a minimum of 15%. The maximum permissible contribution is the lesser of $49,000 or 100% of the participant's earnings for the plan year. Benefit payments are based upon the participant account balance as of the valuation date immediately preceding the date of distribution. The participant may elect to receive distribution in a lump sum; substantially equal annual, semi-annual, quarterly or monthly installments; through the purchase of an immediate or deferred single payment, non-transferable annuity contract; or a combination of the above. Plan provisions and contribution requirements are established and may be amended by City Council. The required City contribution of $3,684,027 and the required employee contributions of $2,383,779 were paid during 2010. Additional employee contributions of $866,978 were also made in 2010. The required contributions represent 12.36% and 8% of total covered payroll, respectively. The plan investments are maintained and administered by Great-West Retirement Services.

3) Defined Contribution Police Pension Plan

The City provides pension benefits for all of its uniformed officers not covered in the Defined Benefit Police Pension Plan through a defined contribution plan. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. Participants are eligible to participate from the date of employment. The Plan requires that the City and the participant each contribute 10% of the participant's compensation. Participants are fully vested after five years of continuous service. City contributions for, and interest forfeited by, employees who leave employment before five years of service are used to reduce the Plan's expenses. Plan provisions and contribution requirements are established and may be amended by City Council.


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150 employees were participants as of December 31, 2010. The required contributions for the City and PMPP employees amounted to $1,190,207 each (10% of covered payroll). The plan allows voluntary and roll over contributions by employees. The plan investments are maintained and administered by Fidelity Investments.

4) Executive Retirement Plan

The City provides pension benefits for the City Manager, his staff and the City Attorney through a separate defined contribution plan. The plans are administered by Great-West Retirement Services. Qualified employees are eligible to participate from the date of employment. Under the plan, the City contributes an amount equal to 10.2% of the participant's base salary. The employees covered by this plan were required to make a 8% contribution in 2010. Employees covered under this Plan are vested upon date of hire. Employees who leave employment with the City are entitled to all contributions and interest earnings. Plan provisions and contribution requirements are established and may be amended by City Council. For the year ended December 31, 2010 the City contributed $194,017 for the benefit of the 13 participants in the Plan and the employees contributed $147,795.

E. Post-Employment Benefits Other than Pensions

The City adopted the standards of Governmental Accounting Standards Board Statement No. 45, Accounting and Financial Reporting by Employers for Post-employment Benefits Other Than Pensions (GASB Statement No. 45), for the year ended December 31, 2008, on a prospective basis. Plan Description – The City has established a single employer-defined benefit post-employment healthcare plan. Employees with at least 20 years of service with the City, or 5 years of service with the City plus 59 years of age, are eligible to receive health insurance benefits after retirement. The retiree pays 100% of the health care premium. These benefits expire when the retiree reaches the age of 65. The authority to establish and amend benefit provisions rests with the City Council. The City does not issue a stand-alone financial report for the plan. Funding Policy – The contribution requirements of plan members and the City are established and may be amended by the City Council. The required contribution is based on projected pay-as-you-go financing requirements. For the year ended December 31, 2010, the City made $52,960 in contributions to the plan. Plan members are required to contribute their share of the premiums. Annual OPEB Cost and Net OPEB Obligation – The City’s annual other post-employment benefit (OPEB) cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period of thirty years. The following table shows the components of the City’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the City’s net OPEB obligation to the plan.


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68

Annual required contribution $ 512,654 Interest on net OPEB obligation 27,876 Adjustment to annual required contribution 25,656 Annual OPEB cost 514,874 Contributions made 52,960 Increase in net OPEB obligation 461,914 Net OPEB Obligation, Beginning 679,288 Net OPEB Obligation, Ending $ 1,141,202

The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for the year ended December 31, 2010, follows.

Percentage of Annual Annual OPEB Net OPEB Year Ended OPEB Cost Cost Contributed Obligation 12/31/10 $ 514,874 10.3 % $ 1,141,202 12/31/09 $ 513,954 27.5 % $ 679,288 12/31/08 $ 510,644 27.4 % $ 370,585

Funded Status and Funding Progress – At January 1, 2010, the most recent actuarial valuation date, the actuarial accrued liability (AAL) was $ 5,118,413 all of which was unfunded. The covered payroll (annual payroll of active employees covered by the plan) was $ 43,239,463 million, and the ratio of the unfunded actuarial accrued liability (UAAL) to the covered payroll was 11.8%. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. These assumptions include among others, annual rates of payroll increases, healthcare cost trends, and mortality rates. Amounts determined regarding the funded status of the plan and the annual required contributions of the City are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents trend information about the actuarial accrued liabilities for benefits. Actuarial Methods and Assumptions – Projections of benefits for financial reporting purposes are based on the substantive plan as understood by the City and plan members, and are based on the types of benefits provided at the time of each valuation and the historical pattern of sharing of the benefit costs between the City and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. Significant methods and assumptions included the following: • Actuarial Valuation Date – January 1, 2010 • Actuarial Cost Method – Projected Unit Credit • Amortization Method – Level Percentage of Pay, Open • Inflation Rate – 2.5% per annum • Remaining Amortization Period – 30 years • Assumed Salary Growth Rate – 3.5% • Asset Valuation Method – Fair Value • Discount Rate – 3.75% • Healthcare Cost Trend Rate and Premium Increase – 10.2% for 2010, 8% for 2011 and

grading to 4.4% over the life cycle.


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69

F. Prior Period Adjustments

The City has determined that certain transactions were recorded incorrectly in a prior year. Governmental Funds: In the Governmental Funds, it was determined that Park Development fees were incorrectly shown as deferred revenue when received and then as revenue in the period when they were spent. To correct this error, all Park Development fees were shown as revenue and the corresponding deferred revenue was eliminated. The beginning balance of the Parks Fund of $2,509,000 has been increased by $3,383,000 to $5,892,000. It was also determined that the Arts Council should be a blended component unit of the Arvada Center. To correct this error, all assets, liabilities, revenues and expenditures of the Arts Council were combined with the Arvada Center and any appropriate eliminations were made. The beginning balance of the Arvada Center of $304,000 has been increased by $332,000 to $636,000. In addition, the beginning net assets for governmental activities of $335,469,000, as originally reported, have been increased $3,715,000 to $339,184,000.

G. Related Party Note

In February 2010, the City and AURA entered into an intergovernmental agreement in which the City loaned the Authority $2,745,000 at a simple interest rate of 3.5% for 2 years. Interest payments are due monthly. The loan is due and payable in full on March 1, 2012. The loan was collateralized with a building and two parcels of land.


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70



Schedule of Funding Progress

Actuarial AccruedLiability (AAL)‐Projected Unit UAAL as a

Actuarial Actuarial Value Credit Cost Unfunded AAL Fund Percentage of Valuation Date of Assets Method (UAAL) Ratio Covered Payroll Covered Payroll01/01/2008 (a) ‐$ 5,370,851$ 5,370,851$ 0% 38,797,330$ 13.84%01/01/2010 ‐$ 5,118,413$ 5,118,413$ 0% 43,239,463$ 11.84%

Retiree Health Program

(a) GASB 45 was implemented as of January 1, 2008; therefore, actuarial information on the Retiree Health Program is not available prior to that date.

71


CONSTRUCTION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL Year Ended December 31, 2010

(in thousands)

VarianceWith Final


Original Final Amounts (Negative)

REVENUES Interest -$ -$ 3$ 3$

Total revenues - - 3 3

EXPENDITURES Current expenditures: Personnel services - - 9 (9) Licenses & Fees - 80 30 50

Total expenditures - 80 39 41

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES - (80) (36) 44

OTHER FINANCING USES Sale of assets 725 725 - (725) Transfer Out - (540) (570) (30)

Total other financing uses 725 185 (570) (755)


FUND BALANCE, BEGINNING 7,430 4,883 4,883 -

FUND BALANCE, ENDING 8,155$ 4,988$ 4,277$ (711)$

Budgeted Amounts

72


73

NON-MAJOR GOVERNMENTAL FUNDS Lands Dedicated Fund - To account for annexation requirements to be used primarily for park purposes. Drainage Fund - To account for drainage fees that are levied as development occurs. Cash fees are restricted for use in construction of drainage facilities within the basin in which collected or may be used to reimburse developers for construction of required drainage structures. Interest accumulated on these cash fees is unrestricted for use, providing the capital drainage facility has sufficient appropriation in the Capital Projects Fund to justify transfer of these monies. Arvada Housing Authority Fund - The Section 8 Housing Assistance Payments Program is administered by the Arvada Housing Authority. The program is designed to provide rent subsidies to low or moderate income households. Police Seizure Fund - Colorado statutes authorize local law enforcement agencies to seize cash and other assets belonging to persons convicted of public nuisance crimes. The statutes also specify that the courts may award the property to the agency that apprehended the criminal and that these resources must be used only for specific law enforcement purposes. This fund was established to account for these resources as they are awarded to and expended by the City's law enforcement agency. Police Tax Increment Funds - The purpose of the tax increment funds is to account for the voter approved sales tax increases to fund expanded police services. Repayment Fund - To account for payments to the City from the Arvada Urban Renewal Authority for notes due to the City. Grants Fund - To account for receipt of lottery monies through the Conservation Trust Fund. Also to account for the disbursement of monies through transfers to other funds for specific uses as dictated by the Conservation Trust Fund. Bond Fund – To account for transfers from the General Fund and Stormwater Fund for payments of principal and interest on the $18,505,000 Series 2005 COP Bonds. Debt Service Fund – To account for the payment of revenue debt incurred through bond issues other than Water Bond Issues, which are accounted for in the Water Fund. Payments for the Limited Sales and Use Tax Revenue Bonds are included in this fund.


74

NON-MAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET


Lands Dedicated

FundDrainage

Fund

Arvada Housing Authority

FundPolice Seizure

Fund

Police Tax Increment (.21) Fund

ASSETS Cash and investments 4,530$ 1,953$ 457$ 243$ 5,681$ Accounts receivable (net) - - 21 - 304 Taxes Receivable - - - - - Accrued interest 9 4 - 1 12 Prepaid costs - - - - 20

Total assets 4,539$ 1,957$ 478$ 244$ 6,017$

LIABILITIES AND FUND BALANCELIABILITIES Accounts payable - - 11 - 100 Due to other funds - - 37 - -

Total liabilities - - 48 - 100

FUND BALANCESReserved for: Prepaid costs - - - - 20 Conservation Trust - - - - - Law enforcement programs - - - 244 5,795 Housing - - 294 - - Emergencies 1 1 113 - 102 Unreserved: Special Revenue Fund 4,538 1,956 23 - - Debt Service Fund - - - - - Total fund balance 4,539 1,957 430 244 5,917

Total liabilities and fund balances 4,539$ 1,957$ 478$ 244$ 6,017$

Special Revenue Funds


75


Repayment Fund Grants Fund Bond Fund

Debt Service Fund

Total Non-major Governmental

5,279$ 66$ 3,225$ 114$ 385$ 21,933$

363 - - - - 688 - 117 - - - 117

11 - 7 - - 44 - - - - - 20

5,653$ 183$ 3,232$ 114$ 385$ 22,802$

109 4 - - - 224 - - - - - 37

109 4 - - - 261

- - - - - 20 - - 3,217 - - 3,217

5,435 - - - - 11,474 - - - - - 294

109 2 15 1 121 465

- 177 - - - 6,694 - - - 113 264 377

5,544 179 3,232 114 385 22,541

5,653$ 183$ 3,232$ 114$ 385$ 22,802$

Debt Service


76

NON-MAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES


Lands Dedicated

FundDrainage

Fund

Arvada Housing Authority

FundPolice Seizure

Fund


REVENUES Taxes -$ -$ -$ -$ $ 3,004 Intergovernmental Revenues - - 3,762 - - Interest 44 19 2 3 56 Miscellaneous - - 20 - 329

Total Revenues 44 19 3,784 3 3,389

EXPENDITURESProgram Costs - - 3,726 25 2,923 Debt Service Principal - - - - - Interest - - - - -

Total expenditures - - 3,726 25 2,923

EXCESS (DEFICIENCY) OF REVENUESOVER EXPENDITURES 44 19 58 (22) 466

OTHER FINANCING SOURCES (USES)Transfers in - - 38 - - Transfers out - - - - -

Total other financing sources (uses) - - 38 - -

NET CHANGE IN FUND BALANCES 44 19 96 (22) 466

FUND BALANCES, BEGINNING 4,495 1,938 334 266 5,451

FUND BALANCES, ENDING 4,539$ 1,957$ 430$ 244$ $ 5,917

Special Revenue Funds


77


Repayment Fund Grants Fund Bond Fund

Debt Service Fund

Total Non-major Governmental

$ 3,577 $ - $ - $ - 4,032$ 10,613$ - 479 - - 4,241 51 (6) 31 6 10 216

- 82 - - - 431

3,628 76 510 6 4,042 15,501

3,054 87 - - - 9,815

- - - 795 3,284 4,079 - - - 605 1,062 1,667

3,054 87 - 1,400 4,346 15,561

574 (11) 510 (1,394) (304) (60)

- - - 1,400 314 1,752 - - (396) - - (396)

- - (396) 1,400 314 1,356

574 (11) 114 6 10 1,296

4,970 190 3,118 108 375 21,245

$ 5,544 $ 179 $ 3,232 $ 114 $ 385 22,541$

Debt Service

CITY OF ARVADA, COLORADO LANDS DEDICATED FUND

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL


VarianceWith Final



REVENUES Dedications 75$ 75$ -$ (75)$ Interest 120 120 44 (76)

Total revenues 195 195 44 (151)

NET CHANGE IN FUND BALANCE 195 195 44 (151)



Budgeted Amounts

78

CITY OF ARVADA, COLORADO DRAINAGE FUND



VarianceWith Final



REVENUES Interest 20$ 20$ 19$ (1)$





Budgeted Amounts

79


ARVADA HOUSING AUTHORITY SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL Year Ended December 31, 2010

(in thousands)

VarianceWith Final



REVENUES Intergovernmental revenues Federal grants 4,649$ 4,649$ 3,762$ (887)$ Interest 5 5 2 (3) Miscellaneous 18 18 20 2

Total revenues 4,672 4,672 3,784 (888)

EXPENDITURES Current expenditures: Personnel services 357 357 299 58 Services and charges 75 75 98 (23) Supplies 23 23 13 10 Rents 4,358 4,358 3,316 1,042

Total expenditures 4,813 4,813 3,726 1,087

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (141) (141) 58 199

OTHER FINANCING USES Transfers In 193 193 38 (155)

Total other financing uses 193 193 38 (155)

NET CHANGE IN FUND BALANCE 52 52 96 44

FUND BALANCE, BEGINNING 331 334 334 -

FUND BALANCE, ENDING 383$ 386$ 430$ 44$

Budgeted Amounts

80

CITY OF ARVADA, COLORADO POLICE SEIZURE FUND



VarianceWith Final



REVENUES Seizure & forfeitures 25$ 25$ -$ (25)$ Interest 3 3 3 -

Total Revenues 28 28 3 (25)

EXPENDITURES 25 25 25 -



FUND BALANCE, ENDING 248$ 269$ 244$ (25)$

Budgeted Amounts

81

CITY OF ARVADA, COLORADO POLICE TAX INCREMENT (.21) FUND



VarianceWith Final



REVENUES Sales and use taxes 2,826$ 2,826$ 3,004$ 178$ Intergovernmental revenues Federal grants - - - - Interest 110 110 56 (54) Miscellaneous - 329 329

Total revenues 2,936 2,936 3,389 453

EXPENDITURES Current expenditures: Personnel services 2,282 2,274 2,276 (2) Services and charges 241 241 175 66 Supplies 521 529 472 57


NET CHANGE IN FUND BALANCE (108) (108) 466 574


FUND BALANCE, ENDING 4,568$ 5,343$ 5,917$ 574$

Budgeted Amounts

82

CITY OF ARVADA, COLORADO POLICE TAX INCREMENT (.25) FUND



VarianceWith Final



REVENUES Sales and use taxes 3,398$ 3,398$ 3,577$ 179$ Interest 115 115 51 (64)

Total revenues 3,513 3,513 3,628 115

EXPENDITURES Current expenditures: Personnel services 2,956 2,956 2,853 103 Services and charges 166 166 96 70 Supplies 173 173 105 68




FUND BALANCE, ENDING 4,893$ 5,188$ 5,544$ 356$

Budgeted Amounts

83

CITY OF ARVADA, COLORADO REPAYMENT FUND



VarianceWith Final



REVENUES Interest -$ -$ (6)$ (6)$ Recovered Cost - 70 82 12

Total Revenues - 70 76 6

EXPENDITURES - 100 87 13

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES - (30) (11) 19

NET CHANGE IN FUND BALANCE - (30) (11) 19



Budgeted Amounts

84

CITY OF ARVADA, COLORADO GRANTS FUND



VarianceWith Final



REVENUES Intergovernmental revenues State grants 516$ 516$ 479$ (37)$ Interest 60 60 31 (29)


OTHER FINANCING USES Transfers out (396) (396) (396) -

Total other financing uses (396) (396) (396) -




Budgeted Amounts

85

CITY OF ARVADA, COLORADO BOND FUND



VarianceWith Final



REVENUES Interest -$ -$ 6$ 6$

EXPENDITURES Debt Service Principal 795 795 795 - Interest 605 605 605 -

Total expenditures 1,400 1,400 1,400 -

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (1,400) (1,400) (1,394) 6

OTHER FINANCING USES Transfers In 1,400 1,400 1,400 -

Total other financing uses 1,400 1,400 1,400 -

NET CHANGE IN FUND BALANCE - - 6 6



Budgeted Amounts

86

CITY OF ARVADA, COLORADO DEBT SERVICE FUND



VarianceWith Final



REVENUES Sales and use taxes 4,032$ 4,032$ 4,032$ -$ Interest 5 5 10 5

Total revenues 4,037 4,037 4,042 5

EXPENDITURES Services and Charges - 2 - 2 Principal 2,995 2,995 3,284 (289) Interest 1,037 1,037 1,062 (25)

Total expenditures 4,032 4,034 4,346 (312)

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES 5 3 (304) (307)

OTHER FINANCING USES Transfers In - - 314 314

Total other financing uses - - 314 314




Budgeted Amounts

87


88



89

ENTERPRISE FUNDS Water Fund - This fund accounts for all activity within the scope of water utility operations. Water service is available to all areas within the City limits and is extended to some residents of the county and adjacent cities. All activities necessary to provide such service are accounted for in this fund, including administration, operations, capital water projects, maintenance, financing and related debt service, and billing and collection. Wastewater Fund - This fund accounts for all activities necessary in the collection, transmission, and disposal of sewage and wastewater. It includes administration, operations, capital maintenance, financing and billing and collection. Stormwater Fund - This fund accounts for all activities necessary to maintain a stormwater management plan. It includes administration, operations, capital maintenance and billing and collection. Golf Course Fund - This fund accounts for all revenues and expenses of the Lake Arbor and West Woods Golf Courses, including food service operations. It includes administrative, operations, maintenance, financing and related debt service at Lake Arbor and West Woods Golf Courses. Food service activities include restaurant operations at the West Woods and Lake Arbor Golf Courses. Food Services Fund - This fund accounts for all revenues and expenses associated with food service activities including the operation of banquet facilities at the Arvada Center for the Arts and Humanities and offsite catering.

CITY OF ARVADA, COLORADO WATER FUND

BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2010

(in thousands)

VarianceWith Final



REVENUES Sales 18,646$ 18,646$ 16,865$ (1,781)$ Licenses/permits and fees 27 27 13 (14) Service charges and fees 224 224 292 68 Interest income 1,954 1,954 676 (1,278) Miscellaneous revenues 23 23 80 57 Developer Contributions 699 699 2,172 1,473 Transfers in 404 394 500 106

Total revenues 21,977 21,967 20,598 (1,369)

EXPENDITURES Operating and maintenance 14,735 17,997 14,337 3,660 Administration 712 717 671 46 Capital Outlay 5,220 2,364 5,033 (2,669) Principal expense 1,550 1,550 1,550 - Interest expense 712 712 697 15 Transfers out 7 7 91 (84)


CHANGE IN NET ASSETS (959)$ (1,380)$ (1,781) (401)$

ADJUSTMENTS TO GAAP BASIS Principal 1,550 Capital Outlay 5,033 Net book value of assets retired (110) Depreciation and amortization (3,364)

CHANGE IN NET ASSETS, GAAP BASIS 1,328$

Budgeted Amounts

90

CITY OF ARVADA, COLORADO WASTEWATER FUND


(in thousands)

VarianceWith Final



REVENUES Licenses/permits and fees 29$ 29$ -$ (29)$ Service charges and fees 9,979 9,979 9,904 (75) Interest income 402 402 95 (307) Other Revenues - - - - Developer Contributions 217 217 328 111 Transfers In 63 63 63 -

Total revenues 10,690 10,690 10,390 (300)

EXPENDITURES Operating and maintenance 7,887 7,959 7,343 616 Administration 742 742 742 - Capital Outlay 1,590 1,590 1,355 235 Transfers Out 259 259 259 -


CHANGE IN NET ASSETS 212$ 140$ 691 551$

ADJUSTMENTS TO GAAP BASIS Capital Outlay 1,355 Net book value of assets retired (216) Depreciation (1,079)

CHANGE IN NET ASSETS, GAAP BASIS 751$

Budgeted Amounts

91

CITY OF ARVADA, COLORADO STORMWATER FUND


(in thousands)

VarianceWith Final



REVENUES Service charges and fees 3,054$ 3,054$ 3,099$ 45$ Grants 10 10 64 54 Interest Income 283 283 112 (171) Developer Contributions - - 84 84 Transfer In - - 1 1

Total revenues 3,347 3,347 3,360 13

EXPENDITURES Operating and maintenance 902 902 832 70 Capital outlay 4,429 4,429 1,515 2,914 Transfers Out 1,132 1,132 1,772 (640)


CHANGE IN NET ASSETS (3,116)$ (3,116)$ (759) 2,357$

ADJUSTMENTS TO GAAP BASIS Capital Outlay 1,515 Deprecation (457)


Budgeted Amounts

92

CITY OF ARVADA, COLORADO GOLF FUND


(in thousands)

VarianceWith Final



REVENUES Sales 1,392$ 1,392$ 1,384$ (8)$ Service charges and fees 2,775 2,775 2,497 (278) Interest income - - 3 3 Miscellaneous revenue 14 14 9 (5) Transfers In 154 154 154 -

Total revenues 4,335 4,335 4,047 (288)

EXPENDITURES Operating and maintenance 3,992 3,991 3,678 313 Principal expense 221 221 221 - Interest expense 52 52 41 11 Capital outlay - 59 52 7 Transfers Out 62 4 4 -



ADJUSTMENTS TO GAAP BASIS Principal 221 Captial Outlay 52 Depreciation (213)


Budgeted Amounts

93


94

FOOD SERVICES FUND BUDGETARY COMPARISON SCHEDULE


VarianceWith Final



REVENUES Sales 1,702$ 1,702$ 1,539$ (163)$ Interest income 16 16 8 (8) Miscellaneous revenues 21 21 15 (6) Transfers in - - 27 27

Total revenues 1,739 1,739 1,589 (150)

EXPENDITURES Operating and maintenance 1,665 1,665 1,546 119 Administration 121 121 41 80 Capital outlay - - 7 (7)


CHANGE IN NET ASSETS (47)$ (47)$ (5) 42$

ADJUSTMENTS TO GAAP BASIS Depreciation (51) Capital Outlay 7

CHANGE IN NET ASSETS, GAAP BASIS (49)$

Budgeted Amounts


95

INTERNAL SERVICE FUNDS Insurance Service Fund - This fund accounts for the activities associated with the City’s worker’s compensation, unemployment and property and liability insurance activities. Premiums are paid by each department into this fund to pay claims, claim reserves and administrative costs of the program including premiums to commercial insurance companies for losses in excess of the self insured amounts. Computer Fund - This fund accounted for the accumulation of financial resources necessary for the timely and orderly replacement and maintenance of the City’s computer equipment and software. Print Shop Fund - This fund accounts for the accumulation of financial resources necessary for the operation of the City’s print shop, copier maintenance and replacement. Vehicle Fund – This fund accounts for the accumulation of financial resources necessary for the timely and orderly replacement and maintenance of the City’s vehicles and equipment. Building Fund – This fund accounts for the accumulation of financial resources used for non-routine building maintenance.

CITY OF ARVADA, COLORADO INTERNAL SERVICE FUNDS

COMBINING STATEMENT OF NET ASSETS December 31, 2010

(in thousands)

TotalInsurance Print Internal

Service Computer Shop Vehicle Building Service Fund Fund Fund Fund Fund Funds

ASSETSCURRENT ASSETS Cash and investments 6,391$ 8,881$ 63$ 7,980$ 2,093$ 25,408$ Accounts Receivable (net) - - 3 - - 3 Accrued Interest 13 18 - 16 4 51 Inventories - - 2 204 - 206 Prepaid costs 5 - 2 12 - 19

Total current assets 6,409 8,899 70 8,212 2,097 25,687

NONCURRENT ASSETS Property and equipment, net of accumulated depreciation - 170 39 4,022 1,219 5,450

Total assets 6,409 9,069 109 12,234 3,316 31,137

LIABILITIESCURRENT LIABILITIES Accounts payable 79 37 6 70 212 404 Claims payable 1,721 - - - - 1,721 Accrued compensated absences 3 - - 41 - 44 Capital lease - - 7 - 89 96

Total current liabilities 1,803 37 13 111 301 2,265

NONCURRENT LIABILITIES Accrued compensated absences 4 - - 41 - 45 Capital lease - - 29 - 505 534

Total non-current liabilities 4 - 29 41 505 579

Total liabilities 1,807 37 42 152 806 2,844

NET ASSETS Invested in capital assets, net of related debt - 170 3 4,022 625 4,820 Unrestricted 4,602 8,862 64 8,060 1,885 23,473

Total net assets 4,602$ 9,032$ 67$ 12,082$ 2,510$ 28,293$

96

CITY OF ARVADA, COLORADO INTERNAL SERVICE FUNDS

COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS Year Ended December 31, 2010

(in thousands)

TotalInsurance Print Internal

Service Computer Shop Vehicle Building ServiceFund Fund Fund Fund Fund Funds

REVENUES Service charges 2,667$ 2,008$ 292$ $ 4,111 $ 407 9,485$ Recovered costs 220 108 10 27 - 365

Total revenues 2,887 2,116 302 4,138 407 9,850

EXPENSES Administration 1,438 90 286 1,500 - 3,314 Insurance premiums/ prescriptions 536 - - - - 536 Uninsured damages and claims 450 - - - - 450 Repair and maintenance - 1,590 4 534 233 2,361 Depreciation - 76 3 759 260 1,098

Total expenses 2,424 1,756 293 2,793 493 7,759

Operating income 463 360 9 1,345 (86) 2,091

NON-OPERATING REVENUES(EXPENSES) Gain (loss) on sale of assets - 19 - 3 - 22 Interest income 43 93 1 65 18 220 Interest expense - - (2) - (26) (28)

Total non-operating revenues (expenses)43 112 (1) 68 (8) 214

INCOME BEFORE TRANSFERS 506 472 8 1,413 (94) 2,305

TRANSFERS IN - 600 - - 111 711

TRANSFERS OUT (2,000) - - (1,700) - (3,700)

CHANGE IN NET ASSETS (1,494) 1,072 8 (287) 17 (684)

NET ASSETS, BEGINNING 6,096 7,960 59 12,369 2,493 28,977

NET ASSETS, ENDING 4,602$ 9,032$ 67$ 12,082$ 2,510$ 28,293$

97


98

INTERNAL SERVICE FUNDS COMBINING STATEMENT OF CASH FLOWS


Insurance Service Fund

Computer Fund

Print Shop Fund

Vehicle Fund

Building Fund

Total Internal Service

Cash Flows From Operating Activities Cash received from external customers 233$ 99$ 8$ 32$ 1$ 373$ Cash received from internal customers 2,668 2,016 291 4,112 407 9,494 Cash payments to external suppliers (575) (1,625) (140) (736) (125) (3,201) Cash payments to internal suppliers (1,677) (13) - (168) - (1,858) Cash payments to employees for services (539) (83) (155) (1,181) - (1,958)

- - - - - - Net cash provided (used) by operating activities 110 394 4 2,059 283 2,850

Cash Flows From Noncapital Financing Activities Transfers to other funds (2,000) - - (1,700) - (3,700) Transfer from other funds - 600 - - 111 711 Net cash provided (used) by noncapital financing activities (2,000) 600 - (1,700) 111 (2,989)

Cash Flows From Capital and Related Financing Activities Purchases of capital assets - (50) - (292) - (342) Payment of capital lease - - (5) - (86) (91) Interest Expense - - (2) - (26) (28) Proceeds from sale of assets - 19 - 43 - 62 Net cash provided (used) by capital and related financing activities - (31) (7) (249) (112) (399)

Cash Flows From Investing Activities Interest on investments 43 93 1 65 18 220 Net cash provided (used) by investing activities 43 93 1 65 18 220

Net increase (decrease) in cash and cash equivalents (1,847) 1,056 (2) 175 300 (318)

Cash and cash equivalents January 1, 2010 8,238 7,825 65 7,805 1,793 25,726

Cash and cash equivalents December 31, 2010 6,391 8,881 63 7,980 2,093 25,408

Reconciliation of operating income to net cash provided (used) by operating activities : Operating income 463 360 9 1,345 (86) 2,091 Adjustments to reconcile operating income to net cash provided by operating activities : Depreciation Expense - 76 3 759 260 1,098 (Increase) decrease in account receivable - - (3) - - (3) (Increase) decrease in inventories 2 (13) (11) (Increase) decrease in prepaid expenditures 1 41 - 2 - 44 (Increase) decrease in accrued interest income 13 (1) - 6 1 19 (Decrease) increase in accounts payable (23) (82) (7) (32) 108 (36) (Decrease) increase in claims payable (339) (339) (Decrease) increase in accrued benefits (5) - - (8) - (13)

Net cash provided (used) by operating activities 110 394 4 2,059 283 2,850

Noncash investing, capital and financing activities Capital Lease -$ -$ 41$ -$ -$ 41$

CITY OF ARVADA, COLORADO INSURANCE SERVICE FUND


(in thousands)

Variance With Final



REVENUES Service charges 2,897$ 2,897$ 2,667$ (230)$ Recovered costs - 220 220 - Interest income 78 78 43 (35)

Total revenues 2,975 3,195 2,930 (265)

EXPENDITURES Administration 1,279 1,279 1,438 (159) Uninsured damages and claims 1,084 1,084 450 634 Insurance premiums 735 1,135 536 599 Transfers Out 2,000 2,000 2,000 -


CHANGE IN NET ASSETS (2,123)$ (2,303)$ (1,494)$ 809$

Budgeted Amounts

99

CITY OF ARVADA, COLORADO COMPUTER FUND


(in thousands)

Variance With Final



REVENUES Service charges $ 2,000 $ 2,000 $ 2,008 $ 8 Recovered costs 46 46 108 62 Gain (loss) on sale of assets 2 2 19 17 Interest income - - 93 93 Transfers In - - 600 600 Total revenues 2,048 2,048 2,828 780

EXPENDITURES Administration 94 94 90 4 Repair and maintenance 1,902 1,902 1,590 312 Capital - - 50 (50)


CHANGE IN NET ASSETS $ 52 $ 52 1,098 $ 1,046

ADJUSTMENTS TO GAAP BASIS Capital Outlay 50 Depreciation (76)

CHANGE IN NET ASSETS, GAAP BASIS 1,072$

Budgeted Amounts

100

CITY OF ARVADA, COLORADO PRINT SHOP FUND


(in thousands)

Variance With Final



REVENUES Service charges $ 401 $ 401 $ 292 $ (109) Recovered Costs - - 10 10 Interest income - - 1 1 Total revenues 401 401 303 (98)

EXPENDITURES Administration 340 340 286 54 Principal 5 5 5 - Interest 2 2 2 - Repair and maintenance 12 12 4 8

Total expenditures 359 359 297 62

CHANGE IN NET ASSETS $ 42 $ 42 6 $ (36)

ADJUSTMENTS TO GAAP BASIS Principal 5 Depreciation (3)


Budgeted Amounts

101

CITY OF ARVADA, COLORADO VEHICLE FUND


(in thousands)

Variance With Final



REVENUES Service charges 4,112$ 4,112$ 4,111$ (1)$ Recovered costs - - 27 27 Interest Income 75 75 65 (10) Gain (loss) on sale of assets 278 278 3 (275)

Total revenues 4,465 4,465 4,206 (259)

EXPENDITURES Administration 1,622 1,630 1,500 130 Repair and maintenance 519 518 534 (16) Capital 3,366 3,359 292 3,067 Transfer Out 1,700 1,700 1,700 -


CHANGE IN NET ASSETS (2,742)$ (2,742)$ 180 2,922$

ADJUSTMENTS TO GAAP BASIS Capital Outlay 292 Depreciation (759)

CHANGE IN NET ASSETS, GAAP BASIS (287)$

Budgeted Amounts

102

CITY OF ARVADA, COLORADO BUILDING FUND


(in thousands)

Variance With Final


Original* Final Amounts (Negative)

REVENUES Service charges 407$ 407$ 407$ -$ Interest Income - - 18 18 Transfers In 111 111 111 -

Total revenues 518 518 536 18

EXPENDITURES Repair and maintenance 245 245 233 12 Capital - - - - Principal 85 85 85 - Interest 26 26 26 -

Total expenditures 356 356 344 12


ADJUSTMENTS TO GAAP BASIS Principal 85 Depreciation (260)


Budgeted Amounts

103


104



AGENCY FUND STATEMENT OF CHANGES IN ASSETS AND LIABILITIES


Balance BalanceJanuary 1, December 31,

2010 2010

ESCROW FUND

ASSETS Cash and investments 4,316$ 421$ 626$ 4,111$ Accrued Interest 11 3 8 Accounts receivable 2,078 671 884 1,865 Total assets 6,405 1,092 1,513 5,984

LIABILITIES Escrow funds 6,405 1,071 1,492 5,984 Total liabilities 6,405$ 1,071$ 1,492$ 5,984$

Additions Deductions

105


106



The public report burden for this information collection is estimated to average 380 hours annually. Form # 350-050-36

City of Arvada

YEAR ENDING :Dec-10

This Information From The Records Of Prepared By: Daniel LeongCity of Arvada Phone: 720-898-7122

A. Local B. Local C. Receipts from D. Receipts from Motor-Fuel Motor-Vehicle State Highway- Federal Highway

Taxes Taxes User Taxes Administration1. Total receipts available2. Minus amount used for collection expenses3. Minus amount used for nonhighway purposes4. Minus amount used for mass transit5. Remainder used for highway purposes

AMOUNT AMOUNTA. Receipts from local sources: A. Local highway disbursements: 1. Local highway-user taxes 1. Capital outlay (from page 2) 7,525,186 a. Motor Fuel (from Item I.A.5.) 2. Maintenance: 5,025,196 b. Motor Vehicle (from Item I.B.5.) 3. Road and street services: c. Total (a.+b.) a. Traffic control operations 3,183,597 2. General fund appropriations 20,414,999 b. Snow and ice removal 749,446 3. Other local imposts (from page 2) 1,293,417 c. Other 4. Miscellaneous local receipts (from page 2) 0 d. Total (a. through c.) 3,933,043 5. Transfers from toll facilities 4. General administration & miscellaneous 676,670 6. Proceeds of sale of bonds and notes: 5. Highway law enforcement and safety 9,115,405 a. Bonds - Original Issues 6. Total (1 through 5) 26,275,501 b. Bonds - Refunding Issues B. Debt service on local obligations: c. Notes 1. Bonds: d. Total (a. + b. + c.) 0 a. Interest 7. Total (1 through 6) 21,708,416 b. RedemptionB. Private Contributions c. Total (a. + b.) 0C. Receipts from State government 2. Notes: (from page 2) 4,178,231 a. InterestD. Receipts from Federal Government b. Redemption (from page 2) 388,854 c. Total (a. + b.) 0E. Total receipts (A.7 + B + C + D) 26,275,501 3. Total (1.c + 2.c) 0

C. Payments to State for highwaysD. Payments to toll facilitiesE. Total disbursements (A.6 + B.3 + C + D) 26,275,501

Opening Debt Amount Issued Redemptions Closing DebtA. Bonds (Total) 0 1. Bonds (Refunding Portion)B. Notes (Total) 0

A. Beginning Balance B. Total Receipts C. Total Disbursements D. Ending Balance E. Reconciliation26,275,501 26,275,501 0

Notes and Comments:

FORM FHWA-536 (Rev. 1-05) PREVIOUS EDITIONS OBSOLETE (Next Page)

AND STREET PURPOSESITEM ITEM

IV. LOCAL HIGHWAY DEBT STATUS

LOCAL HIGHWAY FINANCE REPORT

I. DISPOSITION OF HIGHWAY-USER REVENUES AVAILABLE FOR LOCAL GOVERNMENT EXPENDITURE

ITEM

II. RECEIPTS FOR ROAD AND STREET PURPOSES III. DISBURSEMENTS FOR ROAD

Financial Planning 02/01

(Show all entries at par)

V. LOCAL ROAD AND STREET FUND BALANCE

107


108

STATE:

ColoradoYEAR ENDING (mm/yy):Dec-10

AMOUNT AMOUNTA.3. Other local imposts: A.4. Miscellaneous local receipts: a. Property Taxes and Assessments a. Interest on investments b. Other local imposts: b. Traffic Fines & Penalities 1. Sales Taxes 970,358 c. Parking Garage Fees 2. Infrastructure & Impact Fees d. Parking Meter Fees 3. Liens e. Sale of Surplus Property 4. Licenses 6 f. Charges for Services 5. Specific Ownership &/or Other 323,059 g. Other Misc. Receipts 6. Total (1. through 5.) 1,293,417 h. Other c. Total (a. + b.) 1,293,417 i. Total (a. through h.) 0

(Carry forward to page 1) (Carry forward to page 1)

AMOUNT AMOUNTC. Receipts from State Government D. Receipts from Federal Government 1. Highway-user taxes 3,791,075 1. FHWA (from Item I.D.5.) 2. State general funds 2. Other Federal agencies: 3. Other State funds: a. Forest Service a. State bond proceeds b. FEMA b. Project Match c. HUD c. Motor Vehicle Registrations 387,156 d. Federal Transit Admin d. Other (Specify) - DOLA Grant e. U.S. Corps of Engineers e. Other (Specify) f. Other Federal 388,854 f. Total (a. through e.) 387,156 g. Total (a. through f.) 388,854 4. Total (1. + 2. + 3.f) 4,178,231 3. Total (1. + 2.g)

(Carry forward to page 1)

ON NATIONAL OFF NATIONALHIGHWAY HIGHWAY TOTALSYSTEM SYSTEM

(a) (b) (c)A.1. Capital outlay: a. Right-Of-Way Costs 1,215,019 1,337,389 2,552,408 b. Engineering Costs 0 c. Construction: (1). New Facilities 0 (2). Capacity Improvements 1,012,038 961,729 1,973,768 (3). System Preservation 2,679,493 2,679,493 (4). System Enhancement & Operation 319,517 319,517 (5). Total Construction (1) + (2) + (3) + (4) 1,012,038 3,960,739 4,972,778 d. Total Capital Outlay (Lines 1.a. + 1.b. + 1.c.5) 2,227,058 5,298,128 7,525,186

(Carry forward to page 1)

Notes and Comments:

FORM FHWA-536 (Rev.1-05) PREVIOUS EDITIONS OBSOLETE

III. DISBURSEMENTS FOR ROAD AND STREET PURPOSES - DETAIL

ITEM ITEM

ITEM ITEM

LOCAL HIGHWAY FINANCE REPORT

II. RECEIPTS FOR ROAD AND STREET PURPOSES - DETAIL


Contents Page

Financial TrendsThese schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.Net Assets by Component 110Changes in Net Assets (expenses) 111Changes in Net Assets (revenues) 112Fund Balances, Governmental Funds 113Changes in Fund Balances, Governmental Funds 114

Revenue CapacityThese schedules contain information to help the reader assess the factors affecting the City's ability to generate its property and sales taxes.Direct and Overlapping Sales Tax Rates 115Sales and Use Tax Revenue 116-117Principal Property Tax Payers 118-119Property Tax Levies and Collections 120Assessed & Actual Values of Taxable Property 121

Debt CapacityThese 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.Ratios of Outstanding Debt by Type 122Ratios of General Bonded Debt Outstanding 123Direct and Overlapping Governmental Activities Debt 124Legal Debt Margin Information 125Pledged-Revenue Coverage 126Schedule of Debt Service Requirements - Governmental Activities 127Schedule of Debt Service Requirements - Business-Type Activities 128

Demographic and Economic InformationThese schedules offer demographic and economic indicators to help the reader understand the environment wherein the City's financial activites take place and to help make comparisons over time and with other governments.Demographic and Economic Statistics 129Principal Employers 130-131

Operating InformationThese schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the service the City provides and the activities it performs.Full-time Equivalent City Government Employees by Function/Program 132Operating Indicators by Function/Program 133Capital Asset Statistics by Function/Program 134

Sources: Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual Financial Reports for the relevant year. The City implemented GASB Statement 34 in 2003; schedules presenting government-wide information include information beginning in that year.

Statistical SectionThis part of the City of Arvada's Comprehensive Annual Financial Report represents detailedinformation as a context for understanding what the information in the financial statements, notedisclosures, and required supplemental information says about the City's overall financial health.

109

CITY OF ARVADA, COLORADO City of Arvada

Net Assets by Component Last Eight Fiscal Years

(accrual basis of accounting)

2003 2004 2005 2006 2007 2008 2009 2010Governmental Activities Invested in capital assets, net of related debt 190,540$ 199,026$ 201,623$ 213,611$ 223,565$ 233,223$ 218,883$ 222,197$ Restricted 14,474 16,626 37,925 29,974 15,735 17,425 18,174 20,156 Unrestricted 78,559 76,450 49,722 52,701 74,472 80,607 98,412 106,099 Total governmental activities net assets 283,573$ 292,102$ 289,270$ 296,286$ 313,772$ 331,255$ 335,469$ 348,452$

Business-type Activities Invested in capital assets, net of related debt 126,226$ 136,294$ 146,968$ 160,118$ 174,370$ 186,979$ 194,128$ 198,953$ Restricted - - - - 100 100 Unrestricted 69,579 71,309 71,037 83,312 89,078 92,657 89,902 87,764 Total business-type activities net assets 195,805$ 207,603$ 218,005$ 243,430$ 263,548$ 279,736$ 284,030$ 286,717$

Primary Government Invested in capital assets, net of related debt 316,766$ 335,320$ 348,591$ 373,729$ 397,935$ 420,202$ 413,011$ 421,150$ Restricted 14,474 16,626 37,925 29,974 15,835 17,801 18,174 20,156 Unrestricted 148,138 147,759 120,759 136,013 163,550 172,988 188,554 193,863 Total primary government net assets 479,378$ 499,705$ 507,275$ 539,716$ 577,320$ 610,991$ 619,739$ 635,169$

Source: City of Arvada, Finance Department

Note: Change in format of CAFR does not have 10 years of history.Government-wide financial statements have been prepared in accordance with the requirements ofGASB Statement 34. Financial Statements were not restated for previous years for purposes of providingten-year trend data. In future years, as information becomes available, additional years will be presented.

Fiscal Year

110


Changes in Net Assets Last Eight Fiscal Years

(accrual basis of accounting)

Functions/Program Activities 2003 2004 2005 2006 2007 2008 2009 2010Expenses Governmental activities: General Government 22,177$ 17,569$ 33,914$ 22,946$ 26,142$ 27,821$ 14,267$ 12,930$ Public safety 17,843 19,047 19,380 21,278 22,054 22,922 23,544 22,999 Public works 12,866 13,858 14,007 14,843 17,357 16,352 16,967 17,102 Parks and recreation 5,379 5,506 5,865 6,231 6,598 6,861 14,273 14,382 Culture 7,875 8,242 9,170 9,352 9,155 10,041 10,649 10,004 Human Services 5,334 5,528 5,051 4,170 4,081 4,355 4,251 4,734 Interest 2,371 2,157 2,084 2,469 2,361 2,245 2,329 1,579

Total governmental activities expenses 73,845 71,907 89,471 81,289 87,748 90,597 86,280 83,730

Business-type activities: Water 13,949 13,962 15,524 16,288 17,137 18,807 19,386 19,150 Wastewater 6,315 6,816 7,007 6,931 7,633 9,359 8,770 9,341 Other 6,586 6,860 6,421 6,982 6,894 7,079 7,035 6,764

Total business-type activities expenses 26,850 27,638 28,952 30,201 31,664 35,245 35,191 35,255

Total primary government expenses 100,695$ 99,545$ 118,423$ 111,490$ 119,412$ 125,842$ 121,471$ 118,985$

Program Revenues Governmental activities: Charges for services: General Government 5,985 6,077 10,268 9,535 10,193 11,212 5,267 5,130 Public works 2,023 2,603 2,473 1,926 2,006 1,892 3,008 2,603 Parks & Recreation 587 736 770 762 866 885 1,020 1,479 Other activities 3,926 3,975 4,136 5,269 8,864 6,979 6,959 6,101 Operating grants and contributions 9,063 9,517 10,019 9,301 9,265 9,008 9,501 11,790 Capital grants and contributions 13,178 8,171 7,347 4,596 6,960 12,432 2,789 180

Total governmental activities program revenues 34,762 31,079 35,013 31,389 38,154 42,408 28,544 27,283

Business-type activities: Charges for services: Water 12,806 12,751 13,502 16,525 15,881 19,285 14,972 17,250 Wastewater 5,525 5,339 5,979 6,921 7,692 8,484 9,753 9,904 Other 8,800 8,927 8,072 8,359 9,167 8,857 8,661 8,543 Operating grants and contributions - - - - - - - Capital grants and contributions 8,070 8,619 7,602 10,658 10,563 10,706 1,581 2,584

Total business-type activities program revenues 35,201 35,636 35,155 42,463 43,303 47,332 34,967 38,345

Total primary government program revenues 69,963$ 66,715$ 70,168$ 73,852$ 81,457$ 89,740$ 63,511$ 65,628$

Fiscal Year

64

111


Changes in Net Assets Last Seven Fiscal Years

(modified accrual basis of accounting) Functions/Program Activities 2003 2004 2005 2006 2007 2008 2009 2010Net (Expense)/RevenueGovernmental activities (39,083) (40,828) (54,458) (49,900) (49,594) (48,189) (57,736) (56,447)Business-type activities 8,351 7,998 6,203 12,262 11,639 12,087 (224) 3,090Total primary government net expense ($30,732) ($32,830) ($48,255) ($37,638) ($37,955) ($36,102) ($57,960) ($53,357)

General Revenues and Other Changes In Net AssetsGovernmental activities: Taxes Property taxes 4,113$ 4,412$ 4,404$ 4,534$ 4,785$ 5,099$ 5,121$ 4,961 Franchise taxes 3,277 3,490 - - - - - - Sales taxes 33,352 34,956 34,674 42,426 50,051 50,322 49,530 50,259 Transportation taxes 4,384 4,481 4,295 4,692 4,668 4,533 4,665 4,761 Investment earnings 4,383 4,141 4,746 6,509 5,529 4,707 1,875 1,234 Miscellaneous 726 643 5,258 1,449 4,871 1,122 462 3,119 Transfers (671) (2,766) (1,751) (2,694) (2,824) (111) 882 1,381 Total governmental activities 49,564 49,357 51,626 56,916 67,080 65,672 62,535 65,715 Business-type activites Investment earnings 1,370 854 1,653 3,279 5,244 3,832 1,361 894 Miscellaneous 168 180 795 7,190 411 158 1,319 84 Transfers 671 2,766 1,751 2,694 2,824 111 (882) (1,381)

Total business-type activities 2,209 3,800 4,199 13,163 8,479 4,101 1,798 (403) Total primary government 51,773$ 53,157$ 55,825$ 70,079$ 75,559$ 69,773$ 64,333$ 65,312$

Change in Net AssetsGovernmental activities 10,481 8,529 (2,832) 7,016 17,486 17,483 4,799 9,268 Business-type activities 10,560 11,798 10,402 25,425 20,118 16,188 1,574 2,687 Total primary government 21,041$ 20,327$ 7,570$ 32,441$ 37,604$ 33,671$ 6,373$ 11,955$


Note: General Government represents support and administrative divisions such as Legal, Finance,City Manager's Office, KATV, Human Resources, Planning, Code Enforcement, InformationServices, Courts, and City Council.

Fiscal Year

112


Fund Balances – Governmental Funds Last Ten Fiscal Years

(modified accrual basis of accounting)

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010General Fund Reserve 2,296$ 1,745$ 2,142$ 2,209$ 2,506$ 2,336$ 2,623$ 2,484$ 2,521$ 2,406$ Unreserved 24,215 27,976 28,504 33,084 27,132 28,696 25,981 27,325 30,218 18,652

Total general fund 26,511 29,721 30,646 35,293 29,638 31,032 28,604 29,809 32,739 21,058

All Other Governmental Funds Reserve 7,607 8,361 5,730 4,876 8,669 10,986 13,382 15,048 16,530 18,574 Unreserved Special revenue funds 16,657 14,260 14,822 13,809 11,509 11,827 14,605 16,254 14,862 16,280 Debt Service 637 745 343 4,277 Capital project funds 30,610 20,454 20,985 17,127 24,196 14,163 16,566 18,077 34,275 44,533

Subtotal All Other Governmental Funds 54,874 43,075 41,537 35,812 44,374 36,976 45,190 50,124 66,010 83,664

Total Governmental Funds Reserve 9,903 10,106 7,872 7,085 11,175 13,322 16,005 17,690 18,842 20,980 Unreserved 71,482 62,690 64,311 64,020 62,837 54,686 57,789 62,243 79,907 83,742

Total all other governmental funds 81,385$ 72,796$ 72,183$ 71,105$ 74,012$ 68,008$ 73,794$ 79,933$ 98,749$ 104,722$

Source: City of Arvada Finance Department

Fiscal Year

113


Changes in Fund Balances-Governmental Funds Last Ten Fiscal Years


2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Revenues:

Taxes 40,217$ 41,095$ 40,742$ 42,858$ 42,856$ 50,917$ 58,839$ 59,773$ 58,710$ 59,547$ Licenses and Permits 1,749 2,423 2,329 2,776 2,686 2,275 2,294 2,219 3,450 3,132 Intergovernmental 18,306 13,722 14,716 16,953 14,826 14,773 14,975 13,577 15,291 16,440 Charges for Services 8,534 10,577 13,426 9,902 10,750 10,611 13,203 13,867 8,324 6,788 Fines and Forfeits 1,491 1,417 1,176 1,102 1,129 1,152 1,225 1,378 1,633 1,558 Interest 7,245 5,323 4,290 3,927 4,313 5,520 4,228 3,674 1,431 1,014 Memberships and Donations 578 606 459 457 422 419 317 299 332 291 Miscellaneous 704 541 1,110 1,860 1,150 1,747 4,173 894 664 860

Total revenues 78,824$ 75,704$ 78,248$ 79,835$ 78,132$ 87,414$ 99,254$ 95,681$ 89,835$ 89,630$

Expenditures:

General Government 10,476$ 10,828$ 13,713$ 14,103$ 19,024$ 14,878$ 17,466$ 18,747$ 12,167 13,697 Public Safety 13,535 14,200 15,242 15,924 16,030 17,523 17,628 23,866 24,094 23,873 Public Works 11,816 12,566 13,319 14,025 13,891 15,025 17,792 16,651 17,128 17,286 Program Costs 17,083 18,900 19,071 19,441 21,988 23,039 23,888 20,621 20,981 21,223 Capital Outlay 17,011 20,903 10,904 11,253 24,110 16,324 8,702 4,411 5,946 9,917 Debt Service Principal 2,120 2,225 3,695 1,250 1,840 3,230 3,345 3,460 3,011 4,079 Interest 2,780 2,669 2,371 2,157 2,084 2,469 2,361 2,245 1,469 1,667

Total Expenditures 74,821$ 82,291$ 78,315$ 78,153$ 98,967$ 92,488$ 91,182$ 90,001$ 84,796$ 91,742$

Excess (Deficiency) of RevenuesOver (Under) Expenditures 4,003 (6,587) (67) 1,682 (20,835) (5,074) 8,072 5,680 5,039 (2,112)

Other Financing Sources (Uses)

Bond Issuance costs - - - - - - - - (192) - Proceeds from borrowing - - 110 - 18,505 - - - 20,857 - Payments to escrow agent - - - - - - - - (21,952) - Sale of Assets - - - - 4,752 724 724 725 - - Transfers in 21,768 20,541 18,661 9,853 16,322 21,851 16,562 11,091 15,774 33,617 Transfers out (20,109) (22,543) (19,317) (12,613) (15,837) (23,505) (19,572) (11,357) (12,884) (29,247)

Total Other Financing Sources (Uses) 1,659 (2,002) (546) (2,760) 23,742 (930) (2,286) 459 1,603 4,370

Net Change in Fund Balances 5,662$ (8,589)$ (613)$ (1,078)$ 2,907$ (6,004)$ 5,786$ 6,139$ 6,642$ 2,258$

Debt service as a % of Noncapital Expenditures 9% 9% 10% 5% 6% 8% 7% 7% 6% 8%


Fiscal Year

114


Direct and Overlapping Sales Tax Rates Last Ten Fiscal Years

CityDirectRates

Rapid BaseballTransit Cultural Football

Fiscal Basic State Jefferson Adams District Facilities StadiumYear Rate of Colorado County County RTD District District

2001 3.21% 2.90% 0.50% 0.70% 0.60% 0.10% 0.10%2002 3.21% 2.90% 0.50% 0.70% 0.60% 0.10% 0.10%2003 3.21% 2.90% 0.50% 0.70% 0.60% 0.10% 0.10%2004 3.21% 2.90% 0.50% 0.70% 0.60% 0.10% 0.10%2005 3.21% 2.90% 0.50% 0.70% 1.00% 0.10% 0.10%2006 3.46% 2.90% 0.50% 0.75% 1.00% 0.10% 0.10%2007 3.46% 2.90% 0.50% 0.75% 1.00% 0.10% 0.10%2008 3.46% 2.90% 0.50% 0.75% 1.00% 0.10% 0.10%2009 3.46% 2.90% 0.50% 0.75% 1.00% 0.10% 0.10%2010 3.46% 2.90% 0.50% 0.75% 1.00% 0.10% 0.10%

Source: City of Arvada, Finance Department The combined direct and overlaping rates for Jefferson and Adams counties are 8.06% and 8.31%, respectively.

Overlapping Rates

115


Sales and Use Tax Last Ten Fiscal Years

2001 2002 2003 2004Sales Tax:Grocery Chain Stores 6,074,502$ 5,641,172$ 6,084,534$ 5,877,084$ Fast Food Restaurants 1,368,927 1,415,175 1,419,775 1,455,665 General Dept Stores 4,962,814 6,484,783 6,439,482 6,707,313 Public Utilities 3,335,420 2,966,106 3,101,609 3,376,846 Restaurant & Lounges 8,298,233 1,843,542 1,896,498 1,909,988 Telephone Equipment & Service 775,573 998,110 1,175,604 1,507,751 Misc. - Other 8,096,626 14,577,475 14,230,448 14,408,246

Total Sales Tax 32,912,095 33,926,363 34,347,950 35,242,893

Use Tax:Grocery Chain Stores 29,207 102,552 41,224 60,570 Fast Food Restaurants 29,506 29,851 24,737 24,316 General Dept Stores 107,292 11,131 48,993 15,796 Public Utilities 275,703 227,536 180,843 167,922 Restaurant & Lounges 382,995 56,933 48,584 49,418 Telephone Equipment & Service 2,036 5,070 7,264 7,257 Misc. - Other 669,624 785,647 889,989 863,177

Total Use Tax 1,496,363 1,218,720 1,241,634 1,188,456

Auto Use 5,909,843 5,988,125 5,831,569 5,568,113

Building Use 1,826,496 2,345,927 1,785,921 3,060,688

Total 42,144,797$ 43,479,135$ 43,207,074$ 45,060,150$

City Direct Sales Tax Rate 3.21% 3.21% 3.21% 3.21%


Calendar Year

Note: Report reformatted to reflect both Sales and Use Tax totals presented on a cash basis. Auto Use was restated to reflect end-of-year accurals. Sales and Use tax are reported on a cash basis and include Arvada Urban Renewal Authority taxes through July 2006. Auto and Building Use taxes are reported on an accrual basis. Different rounding settings were used at different phases of the production of these numbers, so some numbers may be off by $1. The Miscellaneous category includes all businesses not listed in the above categories. Revenue increase for Public Utilities was related to an audit due to a natural gas product, which makes electricty, not being taxed correctly. Additionally the decrease in Sales Tax revenue for Public Utilities relates to the new tier structure that the Utility put into place in 2010. The revenue differences in 2009-2010 under the Misc-Other catagory in both Sales and Use Tax are not clearly identified, as in September 2010 the Sales Tax Department took the opportunity to better define their industry codes by expanding the available list.

116


Sales and Use Tax Last Ten Fiscal Years

2005 2006 2007 2008 2009 2010

5,986,055$ 6,529,755$ 7,017,236$ 7,288,486$ 7,321,094$ 7,207,867$ 1,516,717 1,719,437 1,707,247 1,810,008 1,802,468 2,055,222 6,618,964 7,146,661 7,312,606 7,288,906 7,325,139 7,273,593 3,632,166 4,030,217 4,074,050 4,317,928 3,947,475 3,250,660 1,916,329 2,096,434 2,227,360 2,255,327 2,223,585 2,327,476 1,280,206 1,282,742 1,382,418 1,480,300 1,476,853 1,590,756

14,705,419 16,573,910 17,006,837 17,064,447 16,152,264 16,720,308

35,655,856 39,379,156 40,727,754 41,505,402 40,248,879 40,425,882

61,453 110,181 24,091 27,114 68,055 56,962 39,050 32,056 22,567 27,749 15,459 29,626 91,822 56,729 36,522 69,290 48,512 50,083

145,881 154,510 231,681 225,767 589,297 1,141,121 55,256 62,426 45,754 50,506 29,931 23,865

9,455 4,088 3,556 3,203 4,545 4,545 922,461 1,188,404 942,161 1,199,747 1,196,560 1,050,757

1,325,378 1,608,394 1,306,332 1,603,376 1,952,358 2,356,959

5,230,665 4,978,494 5,444,119 4,957,715 4,534,445 4,593,311

2,582,355 2,404,810 1,930,349 1,772,748 2,382,088 2,078,930

44,794,254$ 48,370,854$ 49,408,554$ 49,839,241$ 49,117,770$ 49,455,082$

3.21% 3.46% 3.46% 3.46% 3.46% 3.46%

Calendar Year

117

CITY OF ARVADA, COLORADO City of Arvada, Colorado

Principal Property Tax Payers Current Year and Nine Years Ago

2001 2002 2003 2004 2005

Percentage Percentage Percentage Percentage Percentageof Total City of Total City of Total City of Total City of Total City

Taxable Taxable Taxable Taxable Taxable Taxable Taxable Taxable Taxable TaxablAssessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed

Value Rank Value Value Rank Value Value Rank Value Value Rank Value Value Rank ValueTax Remitter

e

ADLP 80th LLC - - - 2,032 9 0.23% 2,164 9 0.22% - - - - - -AMCAP Denver LP 2,053 9 0.23% - - - - - - - - - - - -Arvada Market Place - - - - - - - - - - - - - - -Arvada Market Place East - - - - - - - - - 3,463 9 0.35% 4,346 8 0.42%Arvada Structures LLC - - - - - - - - 0 - - - - -Arvada West 04, LLC - - - - - - - - - - - - 4,661 7 0.45%AT&T Broadband - - - 4,591 4 0.51% - - - - - - - - -Chou Jack C Co Trustee - - - - - - 2,145 10 0.22% - - - - - -CIN Arvada LP - - - - - - - - - - - - - - -Cobe Laboratories 8,396 3 0.96% 8,458 3 0.94% 8,701 4 0.89% 8,105 5 0.83% 8,437 5 0.82%Comcast of Colorado - - - - - - 3,727 5 0.38% 3,691 6 0.38% 3,573 9 0.35%Costco Wholesale Corp. - - - - - - - - - 3,597 8 0.37% - - -Cub Square Centre LLC 3,843 5 0.44% 3,843 5 0.43% 2,869 6 0.29% 3,636 7 0.37% 5,036 6 0.49%Eagle Hardware Inc. - - - - - - - - - - - - - - -Equiatable Crow Arvada LTD. - - - - - - - - - - - - - - -Home Depot USA Inc. - - - - - - - - - - - - - - -Indian Tree LLC 2,566 6 0.29% 2,566 7 0.28% 2,741 7 0.28% 2,741 10 0.28% 2,842 10 0.28%Inland Western Arvada LLC - - - - - - - - - 9,273 4 0.95% 12,489 3 1.21%Milton Roy Company - - - - - - - - - - - - - - -Mountain States Video Inc. 5,050 4 0.58% - - - 17,660 1 1.81% 16,194 1 1.66% 13,639 2 1.33%North Park Center - - - 12,663 2 1.41% 14,216 2 1.45% 13,533 2 1.38% 14,242 1 1.38%Plains End LLC - - - 16,131 1 1.80% 13,073 3 1.34% 10,549 3 1.08% 9,933 4 0.97%Public Service Co. 12,573 2 1.44% - - - - - - - - - - - -Qwest Corp. 13,603 1 1.56% 1,875 10 0.21% - - - - - - - - -R&M Western Partnership - - - - - - - - - - - - - - -Regency Centers LP 1,875 10 0.21% 2,573 6 0.28% - - - - - - - - -Sundyne Corp. 2,085 8 0.24% - - - - - - - - - - -Sunstrand Corp. - - - - - - - - - - - TCI Colorado - - - - - - - - - - - - - - -TVO Southwestern Partners 2,227 7 0.25% 2,227 8 0.25% 2,492 8 0.25% - - - - - -U.S. West - - - - - - - - - - - -

Total 54,271$ 6.20% 56,959$ 6.34% 69,788$ 7.13% 74,782$ 7.65% 79,198$ 7.70%

Source: Jefferson and Adams County Assessors Offices

Note: The top ten taxpayers represents roughly 7% of the total assessed valuation for the City of Arvada.The remaining 93% represents smaller business and residential customers

118


Principal Property Tax Payers Current Year and Nine Years Ago

2006 2007 2008 2009 2010

Percentage Percentage Percentage Percentage Percentageof Total City of Total City of Total City of Total City of Total City

Taxable Taxable Taxable Taxable Taxable Taxable Taxable Taxable Taxable Taxable Assessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed Assessed

Value Rank Value Value Rank Value Value Rank Value Value Rank Value Value Rank ValueTax Remitter

ADLP 80th LLC - - - - - - - - - - - - - - -AMCAP Denver LP - - - - - - - - - - - - - - -Arvada Market Place - - - - - - - - - - - - - - -Arvada Market Place East 3,878 8 0.37% 4,090 9 0.36% 4,090 10 0.36% - - - - - -Arvada Structures LLC - - - - - - - - - 3,657 10 0.32% - - -Arvada West 04, LLC 4,661 7 0.45% 4,477 7 0.40% 4,477 7 0.39% 4,297 7 0.38% 4,110 7 0.37%AT&T Broadband - - - - - - - - - - - - - - -Chou Jack C Co Trustee - - - - - - - - - - - - - - -CIN Arvada LP - - - - - - - - - - - - - - -Cobe Laboratories 7,969 5 0.76% 3,889 10 0.35% - - - - - - - - -Comcast of Colorado 3,534 10 0.34% - - - 4,596 6 0.40% 3,805 9 0.34% 3,704 9 0.33%Costco Wholesale Corp. 3,611 9 0.35% - - - - - - - - 0.00% 3,486 10 0.31%Cub Square Centre LLC 5,036 6 0.48% 4,792 5 0.43% 4,792 5 0.42% 4,594 5 0.41% 4,199 6 0.37%Eagle Hardware Inc. - - - - - - - - - - - - - - -Equiatable Crow Arvada LTD. - - - - - - - - - - - - - - -Home Depot USA Inc. - - - - - - - - - - - - - - -Indian Tree LLC - - - - - - - - - - - - - - -Inland Western Arvada LLC 12,489 3 1.19% 11,456 4 1.02% 11,456 4 1.01% 9,478 3 0.84% 9,615 4 0.86%Mountain States Video Inc. - - - - - - - - - - - - - - -Plains End LLC (& II) 12,601 2 1.21% 12,504 2 1.11% 13,275 2 1.17% 34,352 1 3.05% 28,337 1 2.53%Public Service Co. 16,601 1 1.59% 15,610 1 1.39% 15,238 1 1.34% 9,321 4 0.83% 14,170 2 1.26%Qwest Corp. 9,416 4 0.90% 12,420 3 1.10% 12,447 3 1.09% 12,036 2 1.07% 12,310 3 1.10%R&M Western Partnership - - - - - - - - - - - - - - -Regency Centers LP - - - - - - - - - - - - - - -Sundyne Corp. - - - 4,281 8 0.38% 4,238 9 0.37% 4,531 6 0.40% 4,309 5 0.38%Sunstrand Corp. - - - - - - - - - - - - - - -Target Corp. - - - 4,521 6 0.40% 4,390 8 0.39% 4,019 8 0.36% 3,891 8 0.35%

- - - - - - - - - - -TCI Colorado - - - - - - - - - - - - - - -TVO Southwestern Partners - - - - - - - - - - - - - - -U.S. West

Total 79,796$ 7.63% 78,040$ 6.93% 78,999$ 6.95% 90,090$ 7.99% 88,131$ 7.85%

119


Property Tax Levies and Collections Last Ten Years


Fiscal Taxes Levied CollectionsYear for the Percentage in Subsequent Percentage

Ended Fiscal Year (1) Amount of Levy Years Amount of Levy

2001 2,966,911 2,958,060 99.70% 0.00 2,958,060 99.70%2002 3,619,912 3,599,394 99.43% 0.00 3,599,394 99.43%2003 3,695,017 3,673,671 99.42% 0.00 3,673,671 99.42%2004 3,963,606 3,959,477 99.90% 0.00 3,959,477 99.90%2005 3,996,218 3,993,781 99.94% 0.00 3,993,781 99.94%2006 4,169,012 4,135,847 99.20% 0.00 4,135,847 99.20%2007 4,422,851 4,383,304 99.11% 3,853 4,387,157 99.19%2008 4,757,970 4,718,720 99.18% 2,080 4,720,800 99.22%2009 4,803,790 4,770,519 99.31% 1,795 4,772,315 99.34%2010 4,668,390 4,637,622 99.34% 1,108 4,638,730 99.36%

Source: Jefferson and Adams County Assessors Offices

Note: Excludes Specific Ownership Tax(1) Taxes levied is for the tax year preceding the fiscal year.

The mill levy rate for 2010 is 4.31.

Collection within the Fiscal Year of the Levy Total Collections to Date

120


Assessed Value and Actual Value of Taxable Property Last Ten Years

2001 2002 2003 2004 2005Vacant property 19,856,790$ 19,473,130$ 24,888,210$ 24,582,300$ 26,517,270$ Residential property 620,039,430$ 631,774,510$ 668,716,330$ 678,489,350$ 689,194,530$ Commercial property 117,711,960$ 158,006,570$ 169,080,180$ 169,543,790$ 203,122,180$ Industrial property 42,488,310$ 49,597,740$ 59,594,190$ 59,461,020$ 62,613,590$ Agricultural property 1,415,170$ 1,464,220$ 1,522,620$ 1,532,080$ 1,568,160$ Natural Resources 320$ 320$ 320$ 320$ 320$ State assessed property 29,414,670$ 34,571,620$ 50,996,310$ 45,218,320$ 42,921,340$ Personal property 2,362,510$ 2,979,570$ 2,776,230$ 2,563,490$ 2,762,230$ Total taxable assessed value 833,289,160$ 897,867,680$ 977,574,390$ 981,390,670$ 1,028,699,620$

Total direct tax rate 4.31 4.31 4.31 4.31 4.31

Estimated actual taxable value 7,243,227$ 7,822,202$ 9,465,987$ 9,576,687$ 9,828,930$

Assessed value as a percentage 11.5% 11.5% 10.3% 10.2% 10.5% of estimated actual value

2006 2007 2008 2009 2010Vacant property 20,196,350$ 28,559,660$ 27,772,060$ 22,225,900$ 20,415,720$ Residential property 703,037,820$ 752,547,870$ 759,627,790$ 728,285,380$ 729,786,750$ Commercial property 212,625,220$ 225,401,350$ 230,096,840$ 240,075,860$ 235,714,770$ Industrial property 60,758,960$ 68,972,520$ 68,876,220$ 70,564,000$ 70,224,120$ Agricultural property 1,554,330$ 1,516,050$ 1,492,280$ 1,952,380$ 1,917,540$ Natural Resources 320$ 320$ 420$ 420$ 420$ State assessed property 44,143,550$ 45,809,460$ 46,001,680$ 61,326,920$ 60,603,390$ Personal property 2,900,950$ 3,269,500$ 3,298,970$ 3,054,470$ 3,416,840$ Total taxable assessed value 1,045,217,500$ 1,126,076,730$ 1,137,166,260$ 1,127,485,330$ 1,122,079,550$

Total direct tax rate 4.31 4.31 4.31 4.31 4.31

Estimated actual taxable value 9,886,572$ 10,577,558$ 10,844,919$ 10,359,457$ 10,359,672$

Assessed value as a percentage 10.6% 10.6% 10.5% 10.9% 10.8% of estimated actual value Source: Jefferson and Adams County Assessors' offices.

121


Ratios of Outstanding Debt by Type Last Ten Fiscal Years

(in thousands)

SalesGeneral Tax Certificates Total Percentage

Fiscal Obligation Increment Capital of Water Capital Primary of Personal PerYear Bonds Bonds Lease Participation Bonds Leases Government Income Capita

2001 8,140 50,335 8 - 30,280 2,405 91,168 3.60% 0.892002 7,840 45,615 13 - 30,280 2,578 86,326 3.50% 0.832003 - 45,020 7 - 29,135 2,297 76,459 3.44% 0.752004 - 43,770 1,010 - 27,940 2,006 74,726 3.45% 0.722005 - 41,930 977 18,505 26,690 1,698 89,800 3.11% 0.872006 - 39,405 909 17,800 25,390 2,617 86,121 3.67% 0.842007 - 36,790 846 17,070 24,030 2,465 81,201 2.51% 0.772008 - 34,080 768 16,320 22,615 2,009 75,792 2.55% 0.712009 - 30,770 1,121 15,550 20,205 1,093 68,739 1.95% 0.642010 - 27,775 783 14,755 18,655 875 62,843 1.95% 0.58

Source: City of Arvada Finance Department

Governmental Activities Business-Type Activities

122


Ratio of General Bonded Debt Outstanding and Legal Debt Margin Last Ten Fiscal Years


Percentage ofGeneral Actual Taxable

Fiscal Obligation Redevelopment Value of Per CapitaYear Bonds Bonds Total Property

2001 $0 $0 $0 0.00% $0.002002 $0 $0 $0 0.00% $0.002003 $0 $0 $0 0.00% $0.002004 $0 $0 $0 0.00% $0.002005 $0 $0 $0 0.00% $0.002006 $0 $0 $0 0.00% $0.002007 $0 $0 $0 0.00% $0.002008 $0 $0 $0 0.00% $0.002009 $0 $0 $0 0.00% $0.002010 $0 $0 $0 0.00% $0.00

Source: City of Arvada Comprehensive Annual Financial Report (2001-2010),Jefferson and Adams County Assessors Offices, Denver RegionalCouncil of Governments

General Bonded Debt Outstanding

123


Direct and Overlapping Governmental Activities Debt

2006 2007 2008General Percents Estimated General Percents Estimated General Percents Estimated

Obligation Applicable Share of Obligation Applicable Share of Obligation Applicable Share ofBonded Debt To Overlapping Bonded Debt To Overlapping Bonded Debt To Overlapping

Jurisdiction Outstanding City Debt Outstanding City Debt Outstanding City Debt

DirectCity of Arvada -$ 100.00% -$ -$ 100.00% -$ -$ 100.00% -$

OverlappingJefferson County School District R-1 693,168,474 15.00% 103,975,271 651,955,000 15.00% 97,793,250 609,570,000 15.00% 91,435,500 Adams County School District (50) 106,700,000 5.74% 6,124,580 104,535,000 5.74% 6,000,309 102,290,000 5.74% 5,871,446 North Jeffco Park & Recreation District (Apex) 17,425,000 80.33% 13,997,503 16,235,000 80.33% 13,041,576 14,920,000 80.33% 11,985,236 Hyland Hills Park & Recreation District 15,610,000 3.90% 608,790 14,910,000 3.90% 581,490 14,190,000 3.90% 553,410 Arvada West Town Center Business 5,345,000 100.00% 5,345,000 5,345,000 100.00% 5,345,000 5,345,000 100.00% 5,345,000 Improvement DistrictSouthwest Adams County Fire 1,740,420 13.26% 230,780 1,545,570 13.26% 204,943 1,351,390 13.26% 179,194 Protection District 2

Total 839,988,894$ 130,281,923$ 794,525,570$ 122,966,567$ 747,666,390$ 115,369,786$

2009 2010General Percents Estimated General Percents Estimated

Obligation Applicable Share of Obligation Applicable Share ofBonded Debt To Overlapping Bonded Debt To Overlapping

Jurisdiction Outstanding City Debt Outstanding City Debt

DirectCity of Arvada -$ 100.00% -$ -$ 100.00% -$

OverlappingJefferson County School District R-1 564,450,000 15.00% 84,667,500 502,790,000 15.00% 75,418,500 Adams County School District (50) 99,335,000 5.74% 5,701,829 95,910,000 5.74% 5,505,234 North Jeffco Park & Recreation District (Apex) 13,485,000 80.33% 10,832,501 11,970,000 80.33% 9,615,501 Hyland Hills Park & Recreation District 13,440,000 3.90% 524,160 13,175,000 3.90% 513,825 Arvada West Town Center Business 5,345,000 100.00% 5,345,000 5,345,000 100.00% 5,345,000 Improvement DistrictSouthwest Adams County Fire 1,158,090 13.26% 153,563 965,880 13.26% 128,076 Protection District 2

Total 697,213,090$ 107,224,552$ 630,155,880$ 96,526,136$ Source: Jefferson County School District, Adams County Schools District, Jefferson County Parks, and Recreation District, Hylands Hills Park Recreation District, Southwest Adams County Fire Protection District, and City of Arvada

Note: Overlapping governments listed above incorporate a portion of the City of Arvada. This percentage of the incorporated areas is used to calculate the estimated share of overlapping debt.This figure is taken into account to determine the City of Arvada'a ability to issue and repay long term debt.

124


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125


Pledged-Revenue Coverage Last Ten Fiscal Years

Utility Less: Net Sales Service Operating Available Tax

Year Charges Expenses Revenue Principal Interest Coverage Increment Principal Interest Coverage

2001 22,948,000 11,301,000 11,647,000 2,925,000 1,117,221 2.88 50,335,000 2,120,000 2,779,605 10.272002 21,174,000 11,212,000 9,962,000 2,795,000 1,791,521 2.17 45,615,000 2,225,000 2,669,440 9.322003 19,116,000 11,569,000 7,547,000 1,145,000 1,207,383 3.21 45,020,000 3,695,000 2,261,558 7.562004 20,405,000 11,262,000 9,143,000 1,195,000 408,721 5.70 43,770,000 1,250,000 1,898,941 13.902005 20,075,000 12,519,000 7,556,000 1,250,000 713,999 3.85 41,930,000 1,840,000 1,846,441 11.372006 35,876,000 18,140,000 17,736,000 1,300,000 946,425 7.90 39,405,000 2,525,000 1,777,421 9.162007 27,144,000 13,481,000 13,663,000 1,360,000 959,164 5.89 36,790,000 2,615,000 1,690,339 8.552008 24,695,000 14,455,000 10,240,000 1,415,000 1,054,494 4.15 34,080,000 2,710,000 1,593,666 7.922009 17,759,000 14,625,000 3,134,000 1,540,000 944,004 1.26 30,770,000 2,241,564 840,853 9.982010 19,815,000 15,099,000 4,716,000 1,550,000 697,288 2.10 27,775,000 3,284,428 1,061,698 6.39


Note: Service charges include water sales, licenses and permit fees. Operating expenses include operations, administration & maintenance, and tap fees. Coverage represents the ratio of debt payments to net revenue avaliable.

Sales and use tax bonds are backed by the generation of sales and use tax revenues.

Debt Service Debt Service

Sales and Use Tax BondsWater Revenue Bonds

126

CITY OF ARVADA, COLORADO Schedule of Debt Service Requirements

Governmental Activities December 31, 2010

Sales and Use Tax Refunding and Improvement Revenue Bonds - Series 2003

Total PrincipalYear Principal Interest Payment Balance2010 10,320,0002011 1,325,000 377,906 1,702,906 8,995,0002012 1,370,000 334,844 1,704,844 7,625,0002013 1,420,000 288,606 1,708,606 6,205,0002014 1,465,000 238,906 1,703,906 4,740,0002015 1,520,000 185,800 1,705,800 3,220,0002016 1,580,000 128,800 1,708,800 1,640,0002017 1,640,000 65,600 1,705,600 $ -Totals $10,320,000 $1,620,462 $11,940,462

Sales & Use Tax Revenue Refunding Bonds - Series 2009

Total PrincipalYear Principal Interest Payment Balance2010 17,455,0002011 1,775,000 552,525 2,327,525 15,680,0002012 1,830,000 499,275 2,329,275 13,850,0002013 1,890,000 435,225 2,325,225 11,960,0002014 1,935,000 387,975 2,322,975 10,025,0002015 1,990,000 339,600 2,329,600 8,035,0002016 2,045,000 279,900 2,324,900 5,990,0002017 2,105,000 218,550 2,323,550 3,885,0002018 3,885,000 155,400 4,040,400 $ -

TOTALS $17,455,000 $2,868,450 $20,323,450

127

CITY OF ARVADA, COLORADO Schedule of Debt Service Requirements

Business-Type Activities December 31, 2010

Water Enterprise Revenue Refunding Bonds - Series 2009

Total PrincipalYear Principal Interest* Payment Balance2010 18,655,0002011 1,630,000 634,600 2,264,600 17,025,0002012 1,680,000 585,700 2,265,700 15,345,0002013 1,730,000 535,300 2,265,300 13,615,0002014 1,760,000 500,700 2,260,700 11,855,0002015 1,805,000 456,700 2,261,700 10,050,0002016 1,860,000 402,550 2,262,550 8,190,0002017 1,915,000 346,750 2,261,750 6,275,0002018 2,010,000 251,000 2,261,000 4,265,0002019 2,090,000 170,600 2,260,600 2,175,0002020 2,175,000 87,000 2,262,000 $ -

TOTALS $18,655,000 $3,970,900 $22,625,900

128


Demographic and Economic Statistics Last Ten Calendar Years

PersonalIncome Per

(in thousands Capita Median School UnemploymentYear Population of dollars) Income Age Enrollment Rate

2001 104,150 2,534,907 24,339 36.0 19,295 4.10%2002 101,925 2,467,400 24,208 37.5 18,999 6.30%2003 103,125 2,220,900 21,536 37.2 18,495 6.90%2004 102,655 2,166,328 21,103 37.2 18,434 6.30%2005 103,004 2,885,863 28,017 37.2 17,488 5.70%2006 105,455 2,345,530 22,242 37.2 18,286 4.40%2007 107,050 3,236,229 30,231 37.2 18,064 4.30%2008 106,327 2,968,862 27,922 39.8 19,469 5.60%2009 107,702 3,523,040 32,711 39.4 19,624 8.10%2010 108,539 3,216,987 29,639 39.4 19,409 9.80%

Source: Denver Regional Council of Governments, Adams and Jefferson County SchoolDistricts, Arvada Ecomonic Development Department, and Real Estate Center Website.

Note: Per Capita Income information was provided by the Arvada Economic Development Department,through the US Census Bureau, American Community survey in 2008 inflation adjusted dollars.

Umemployement rate provided by CO Dept. of Labor & Employment

129


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131


Full-time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Function/program

City Manager's/Clerk's Office 17.75 19.75 19.75 19.75 18.75 18.75 18.75 18.75 17.00 17.00Community Development 23.25 23.25 23.25 23.00 23.00 23.00 26.00 26.00 26.00 26.00Cultural Services 38.75 38.75 39.00 39.00 39.00 41.10 41.00 41.00 40.00 39.00Economic Development 4.00 4.00 4.00 4.00 4.00 4.00 4.00 5.00 5.00 4.00Parks, Golf, and Hospitality 69.75 70.75 71.75 72.00 71.00 71.00 72.00 72.00 74.00 72.00Finance/Risk Management 42.25 41.75 42.75 42.75 46.25 46.25 46.25 43.25 43.25 42.75Judicial/Legal 18.75 19.75 19.75 18.75 18.75 18.75 19.00 21.00 21.00 22.00Information Technology 19.00 19.00 22.00 22.00 23.00 26.00 26.00 29.00 29.00 29.00Human Resources 8.00 8.00 8.00 9.00 9.00 9.00 9.00 9.00 9.00 9.00Public Works 182.00 188.00 189.00 191.00 194.50 196.25 198.50 202.75 205.25 200.25Public Safety 209.75 209.75 210.75 211.75 212.75 244.75 244.75 239.00 236.40 230.40

Total 633.25 642.75 650.00 653.00 660.00 698.85 705.25 706.75 705.90 691.40

Source: City of Arvada Budget Book 2011-2012

Note: Figures represents budgeted full and part-time benefited employees.

132


Operating Indicators by Function/Program Last Ten Fiscal Years

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Function/Program

General government Building permits issued 5,478 6,217 6,770 5,414 4,692 5,077 4,619 5,852 14,582 8,552Police Physical arrests 3,019 3,228 3,238 3,134 3,148 3,112 3,005 3,067 2,655 2,373 Parking violations 754 386 796 564 292 473 489 458 314 442 Traffic violations 10,018 11,653 10,807 10,830 9,296 9,062 10,385 10,448 11,513 10,366Other public works Street resurfacing (miles) 12 10 10 9 14 4 17 6 8 18 Potholes repaired --- --- --- --- --- 2,409 8,858 1,343 2,716 6,723Parks and recreation Athletic field permits issued 19,027 19,050 14,850 20,560 21,111 21,651 23,356 22,062 21,989 20,830Water Consumers (Tap) 32,200 32,930 33,810 34,266 34,548 34,368 34,528 35,082 35,104 35,100 New connections 333 283 410 297 324 300 178 131 74 167 Leaks 72 95 79 61 54 48 66 66 37 47 Average daily consumption 17,800,000 17,500,000 17,500,000 17,500,000 15,200,000 17,900,000 16,000,029 16,300,000 13,761,000 15,828,849 (thousands of gallons)

Source: City of Arvada Building Department, Police Department, Street Department, Parks Department, and Water Department.

Note: Building permits increased in FY 2009 due to a major hailstorm.

A major focus and increased funding was placed on pavement preservation/management. This allowed our streets crew to focus more on the entire city's infrastructure. As a result the number of street resurfacing and pothole repairs was more than double over the prior year.

An unusual wet summer caused a decrease in the average daily water consumption in 2009.

Fiscal Year

133


134

City of Arvada, Colorado Capital Assets Statistics by Function/Program

Last Ten Fiscal Years

Function/Program 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Police Stations 1 1 1 1 1 1 1 1 1 1 Patrol units 106 106 106 106 106 107 108 82 79 79Fire Protection Districts 2 2 2 2 3 3 3 3 3 3Other public works Streets (miles) 385 392 392 392 398 401 404 404 411 413Parks and recreation Square Miles (City of Arvada) 33 35 35 35 36 36 36 36 36 36 Playgrounds 47 48 48 48 50 55 55 57 Tennis/basketball Courts 71 73 71 75 71 72 71 72 72 75 Baseball/softball diamonds 40 40 11 26 26 25 35 41 41 41 Soccer/football fields 29 35 9 24 33 41 25 27 27 27 Community centers/Sport complexes 20 20 20 20 19 21 21 19 19 19Water Water mains (miles) 415 418 420 542 560 540 542 550 551 568 Fire hydrants 4,293 4,388 4,442 4,547 4,606 4,640 4,676 4,639 4,650 4808Wastewater Sanitary sewers (miles) 370 370 372 391 434 392 392 396 400 408 Storm sewers (miles) 167 102 107 127 125 144 136 140 144 145 Treatment capacity (millions of gallons) 3,713 3,130 3,187 3,172 3,104 3,160 3,401 3,430 3,256 3,295

Source: City of Arvada, Police, Parks & Rec, Engineering Departments

Fiscal Year

Documents

CAFR for Year Ending 12/31/10