HomeMy WebLinkAbout20143092.tiff RECEIVED
OCT 062014
WELD COUNTY
COMMISSIONERS
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
Weld County, Colorado
FINANCIAL STATEMENTS
December 31, 2013
2014-3092
cOITIMA0126
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TABLE OF CONTENTS
INDEPENDENT AUDITOR'S REPORT 1-2
BASIC FINANCIAL STATEMENTS
Government-wide Financial Statements
Governmental Funds Balance Sheet/Statement of Net Position 3-4
Statement of Governmental Fund Revenues, Expenditures,
and Changes in Fund Balances/Statement of Activities 5-6
General Fund- Statement of Revenues, Expenditures,
And Changes in Fund Balance—Budget and Actual 7
Notes to Financial Statements 8-19
Supplemental Information
Conservation Trust- Schedule of Revenues, Expenditures,
And Changes in Fund Balance—Budget and Actual 20
Debt Service Fund - Schedule of Revenues, Expenditures,
And Changes in Fund Balance—Budget and Actual 21
L. PAUL GOEDECKE P.C.
CFHT,FIED PUBLIC ACCOUNTANTS
950 WADSWORTH BLVD
SU TF 29-i
LAKEWOOD. COLORADO 92212
TEC--'-ICNL ;3031 232 2833
FAX 3_? 232-9002
Independent Auditor's Report
Board of Directors
Beebe Draw Farms Metropolitan District No. 1
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each major
fund of Beebe Draw Farms Metropolitan District No. I as of and for the year ended December 31, 2013,
which collectively comprise the District's basic financial statements, as listed in the table of contents.
These financial statements are the responsibility of the District. Our responsibility is to express opinions
on these financial statements based on our audit.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair presentation
of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We
conducted our audits in accordance with auditing standards generally accepted in the United States of
America. Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entity's preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly,
we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of significant accounting estimates made by management, as well as
evaluating the overall presentation of the financial statements. We believe the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund of the Beebe Draw Farms
Metropolitan District No. 1 as of December 31, 2013, and the respective changes in financial position and
the respective budgetary comparison for the general fund for the year then ended in conformity with
accounting principles generally accepted in the United States of America.
LI AlRL I' UI AMERICAN INSIIT UTE OF CERTIFIED PUBLIC ACCOUNTANTS AND COLORADO SOCIE'v OF CERTIFIED +IIHI IC ACCi01-N IAN IS
Other Matters
Management has omitted the management's discussion and analysis that accounting principles generally
accepted in the United States of America require to be presented to supplement the basic financial
statements. Such missing information,although not a part of the basic financial statements, is required by
the Governmental Accounting Standards Board, who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or historical
context. Our opinions on the basic financial statements are not affected by this missing information.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the District's financial statements as a whole. The supplementary information as listed in the
table of contents is presented for purposes of legal compliance and additional analysis and is not a
required part of the financial statements. The supplementary information is the responsibility of
management and was derived from and relates directly to the underlying accounting and other records
used to prepare the financial statements. The information has been subjected to the auditing procedures
applied in the audit of the financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting and other records used to prepare the
fmancial statements or to the financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our opinion,
the information is fairly stated in all material respects in relation to the fmancial statements as a whole.
L.Paul Goedecke,P.C.
June 10,2014
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
Governmental Funds Balance Sheet/Statement of Net Position
December 31, 2013
General Debt Service Conservation
Fund Fund Trust
ASSETS:
Cash and investments $ 42,859 —
Cash and investments -restricted 5,926 76,803 4,621
Receivable—County Treasurer 4,109 —
Property taxes receivable 286,82_3 203.845 —
Total assets $ 339,717 S 280,648 $ 4,621
LIABILITIES:
Accounts payable $ 2,610 $ 250 $ —
Due to Authority 44.358 — —
Accrued interest on bonds — — —
Long-term liabilities:
Due within one year — —
Due in more than one year —Total liabilities 46,968 250
DEFERRED INFLOWS OF RESOURCES
Deferred property taxes 286,823 203,845 -
Total deferred inflows of resources 286,823 203,845 —
FUND BALANCES/NET POSITION:
Fund Balances:
Restricted
Emergencies 5.926 —
Debt service 76,553 —
Conservation Trust — — 4,621
Unassigned — —
Total fund balances _ 5.926 76,553 4,621
Total liabilities,deferred inflows of
resources and fund balances $ 339,717 $ 280,648 $ 4,621
•
Net Position:
Restricted for:
Emergencies
Debt service
Conservation Trust projects
Unrestricted
Total net position
3
Adjustments Statement of
Total Note 9 Net Position
$ 42,859 $ - $ 42,859
87,350 - 87,350
4,109 - 4,109
490,668 - 490,668
$ 624,986 - 624,986
$ 2,860 - 2,860
44,358 - 44,358
1,719 1,719
185,000 185,000
720,000 720,000
47,218 906,719 953,937
490,668 - 490,668
490,668 - 490,668
5,926 (5,926) -
76,553 (76,553) -
4,621 (4,621) -
87,100 (87,100) -
$ 624,986
5,926 5,926
74,834 74,834
4,621 4,621
(905,000) (905,000)
$ (819,619) $ (819,619)
:VOTE: The accompanying notes are an integral part of the financial statements.
4
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
STATEMENT OF GOVERNMENTAL FUND REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES/STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2013
Government Fund Types
Debt Service Conservation
General Fund Fund Trust
EXPENDITURES/EXPENSES
Audit and accounting $ 8,887 S — $ —
Insurance 3,831 — —
Legal 2.182_•
— —
•
Management fees 4,455 — —
Miscellaneous expenses 793 — —
Director's fees 800 - —
Treasurer's fees 6,502 3,491 —
Transfer to Authority -infrastructure 290,588 — —
TransfertoAuthority—amenities 72.647 —
Transfer to Authority—general funds 91.502 —
Debt Service
Bond interest — 19,398 —
Bond principal — 185,000 —
Paying agent fees — 425 —
Bond issuance costs - 1,075 —
Totalexpenditures/expenses 482,187 209.389 —
REVENUES
Program revenues - Lottery funds - - 303
General revenues -Property tax 434.374 23?,173 —
Specific ownership taxes 45,816 - -
-Interest income 2I 31 1
-Other income 7,902 —Total revenues 488,113 232.204 304
EXCESS(DEFICIENCY)OF REVENUES
OVER EXPENDITURES 5,926 22.815 304
NET CHANGES IN FUND BALANCES 5,926 22.815 304
CHANGE IN NET POSITION
FUND BALANCES/NET POSITION:
BEGINNING OF YEAR - 53,738 4,317
END OF YEAR $ 5.926 $ 76,553 S 4,621
5
Adjustments Statement of
Total Note 9 Activities
$ 8,887 $ - $ 8,887
3.831 - 3,831
2,182 - 2,182
4,455 - 4,455
793 - 793
800 - 800
9,993 - 9,993
290,588 - 290,588
72,647 - 72,647
91,502 - 91,502
19,398 103 19,501
185,000 (185,000) -
425 - 425
1,075 - 1,075
691,576 (184,897) 506,679
666,547 - 666,547
45,816 - 45,816
53 - 53
7,902 - 7,902
303 - 303
720,621 - 720,621
29,045 184,897 213,942
29,045 (29,045) -
213,942 213,942
58,055 (1,091,616) (1,033,561)
$ 87,100 $ (906,719) $ (819,619)
NOTE: The accompanying notes are an integral part of the financial statements.
6
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES —BUDGET AND ACTUAL
Year Ended December 31, 2013
Variance with
Final Budget
Actual Positive
Original Budget Final Budget Amounts (Negative)
REVENUES
Property taxes S 435,952 S 444,788 8 434,374 S (10.414)
Specific ownership taxes 40,187 40,187 45.816 5.629
Other income - - 7,902 7.902
Interest income 25 25 21 (4)
Total revenues 476,164 485,000 488,113 3,113
EXPENDITURES
General government
Accounting and audit 8.500 8.500 8.887 (387)
Insurance 4.000 4,000 3,831 169
Legal 3,500 3,500 2.182 1,318
Management fees 2,500 2,500 4,455 (1,955)
Miscellaneous expense 1,577 1,577 793 784
Directors fees 1,000 1,000 800 200
Treasurer's fees 6,539 6,539 6.502 37
Transfer to Authority-Infrastructure 274,209 290,588 290.588 -
Transfer to Authority- Amenities 68,552 72,647 72,647 -
TransfertoAuthority-General Fund 91,502 91,502 91,502
Emergency reserve 14.285 2,647 - 2,647
Total expenditures 476,164 485,000 482,187 2,813
EXCESS(DEFICIENCY)OF
REVENUE OVER
EXPENDITURES - - 5926 5.92_6
FUND BALANCE-BEGINNING OF
YEAR - - - -
FUND BALANCE- END OF
YEAR S - S - 5 5,926 $ 5,926
.VOTE: The'accompanying notes are an integral part al the financial statements_
7
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — DEFINITION OF REPORTING ENTITY
Definition of Reporting Entity
Beebe Draw Farms Metropolitan District No. 1 (The District), a quasi-municipal corporation, is
governed pursuant to provisions of the Colorado Special District Act. The District's service area
is located in Weld County, Colorado. The District was established to provide water, parks and
recreational facilities, street and drainage improvements, safety protection and related services.
During 1999, the District's service plan was amended. A new district, Beebe Draw Farms
Metropolitan District No. 2 (District No. 2) was created (see Note 9) and the District's name was
changed from Beebe Draw Farms Metropolitan District to Beebe Draw Farms Metropolitan
District No. I.
The District has no employees and all operation and administrative functions are contracted.
The District follows the Governmental Accounting Standards Boards (GASB) accounting
pronouncements which provide guidance for determining which governmental activities,
organizations and functions should be included within the financial reporting entity. GASB
pronouncements set forth the financial accountability of a governmental organization's elected
governing body as the basic criterion for including a possible component governmental
organization in a primary governments legal entity. Financial accountability includes, but is not
limited to, appointment of a voting majority of the organization's governing body, ability to
impose its will on the organization, a potential for the organization to provide specific financial
benefits or burdens and fiscal dependency.
The District is not financially accountable for any other organization, nor is the District a
component unit of any other primary governmental entity, including District No. 2.
NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The more significant accounting policies of the District are described as follows:
Basis of Presentation
The accompanying financial statements are presented per GASB Statement No. 34 — Special
Purpose Governments.
8
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting. Revenues are recorded when earned and
expenses are recorded when a liability is incurred, regardless of the timing of related cash flows.
Property taxes are recognized as revenues in the year for which they are levied.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are 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 District considers revenues to be available if they are collected
within 60 days of the end of the current period. The material sources of revenue subject to
accrual are property taxes and interest. Expenditures, other than interest on long-term
obligations, are recorded when the liability is incurred or the long-term obligation is paid.
The government reports the following major governmental funds:
General Fund — The General Fund is the general operating fund of the District. It is used to
account for all financial resources not accounted for and reported in another fund.
Debt Service Fund —The Debt Service Fund is used to account for the accumulation of resources
that are restricted, committed or assigned to expenditures for principal, interest and other debt
related costs.
Fund Balances
Beginning with fiscal year 2011 the District implemented GASB Statement No. 54. "Fund
Balance Reporting and Governmental Fund Type Definitions." This statement provides more
clearly defined fund balance categories to make the nature and extent of the constraints placed on
a government's fund balances more transparent. In the fund financial statements the following
classifications describe the relative strength of the spending constraints.
Non-spendable fund balance — The portion of fund balance that cannot be spent because it is
either not in spendable form (such as inventory) or is legally or contractually required to be
maintained intact.
Restricted fund balance — The portion of fund balance constrained to being used for a specific
purpose by external parties (such as grantors or bondholders), constitutional provisions or
enabling legislation.
9
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Committed fund balance — The portion of fund balance constrained for specific purposes
according to limitations imposed by the District's highest level of decision making authority, the
Board of Directors prior to the end of the current fiscal year. The constraint may be removed or
changed only through formal action of the Board of Directors.
Assigned fund balance — The portion of fund balance that is constrained by the government's
intent to be used for specific purposes, but is neither restricted nor committed. Intent is expressed
by the Board of Directors to be used for a specific purpose. Constraints imposed on the use of
assigned amounts are more easily removed or modified than those imposed on amounts that are
classified as committed.
Unassigned fund balance — The residual portion of fund balance that does not meet any of the
above criteria.
If more than one classification of fund balance is available for use when an expenditure is
incurred, it is the District's policy to use the most restrictive classification first.
New Accounting Pronouncements
Effective January 1, 2012, the District implemented the provisions of GASB No. 63, "Financial
Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position"
(GASB No. 63) and early implemented the provisions of GASB No. 65, "Items Previously
Reported as Assets and Liabilities" (GASB 65).
GASB No. 63 provides guidance for reporting deferred outflows and deferred inflows of
resources as introduced and defined in GASB Concepts Statement No. 4 "Elements of Financial
Statements" (Concepts Statement No. 4). Concepts Statement No. 4 defines a deferred outflow
of resources as a consumption of net assets that is applicable to a future reporting period. A
deferred inflow of resources is defined as an acquisition of net assets applicable to a future
reporting period. The impact on the District's financial statements has been to replace the term
"net assets" with "net position". Additionally, the District's receivable for 2013 property taxes
that will be collected during 2014 is considered to be a deferred inflow of resources. This is
reflected on the Governmental Funds Balance Sheet/Statement of Net Position.
GASB No. 65 establishes accounting and financial reporting standards that reclassify, as deferred
outflows of resources or deferred inflows of resources, certain items that were previously
reported as assets and liabilities. Some assets previously reported as assets are now reported as
an outflow of resources/expenses. The adoption of this standard had no impact on the District's
financial statement.
10
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Budgets
In accordance with the State Budget Law, the District's Board of Directors holds public hearings
in the fall of each year to approve the budget and appropriate the funds for the ensuing year. The
appropriation is at the total fund expenditures level and lapses at year end. The District's Board
of Directors can modify the budget by line item within the total appropriation without
notification. The appropriation can only be modified upon completion of notification and
publication requirements. The budget includes each fund on its basis of accounting unless
otherwise indicated.
During the year the District amended its General Fund budget from $476,164 to S485,000 and
the Debt Service Fund from $208,124 to $210,000.
Cash
The District follows the practice of pooling cash of all funds to maximize investment earnings.
Except when required by trust or other agreements, all cash is deposited to and disbursed from a
single bank account. Cash in excess of immediate operating requirements is pooled for deposit
and investment flexibility. Investment earnings are allocated periodically to the participating
funds based upon each fund's average equity balance in the total cash.
Property Taxes
Property taxes are levied by the District Board of Directors. The levy is based on assessed
valuations determined by the County Assessor generally as of January 1 of each year. The levy is
normally set by December 15 by certification to the County Commissioners to assess the
property tax obligation of the individual properties as of January 1 of the following year. The
County Treasurer collects the determined taxes during the ensuing calendar year. The taxes are
payable by April, or at the taxpayers election, in equal installments in February and June.
Delinquent taxpayers are notified in August and the sales of the resultant tax liens on delinquent
properties are generally held in November or December. The County Treasurer remits the taxes
collected monthly to the District.
Property taxes, net of estimated uncollectible taxes, are recorded initially as deferred revenue in
the year they are levied and measurable. The deferred property tax revenues are recorded as
revenue in the year they are available or collected.
BEEBE DRAW FA
RMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Reserved Fund Balance
Emergency Reserves have been provided for as required by Article X, Section 20 of the
Constitution of the State of Colorado. $5,926 of the General Fund balance has been reserved in
compliance with this requirement.
NOTE 3- CASH AND INVESTMENTS
Cash and investments as of December 31, 2013 are classified in the accompanying financial
statement as follows:
Statement of net assets:
Cash and investments $ 42,859
Restricted investments 87,350
$ 130,209
Cash and investments as of December 31, 2013 consist of the following:
Deposits with financial institutions $ 87,078
Investments 43,131
$ 130,209
NOTE 3 -CASH AND INVESTMENTS
Cash Deposits
The Colorado Public Deposit Protection Act (PDPA) requires that all units of local government
deposit cash in eligible public depositories. Eligibility is determined by state regulators. Amounts
on deposit in excess of federal insurance levels must be collateralized. The eligible collateral is
determined by the PDPA. PDPA allows the institution to create a single collateral pool for all
public funds. The pool for all the uninsured public deposits as a group is to be maintained by
another institution or held in trust. The market value of the collateral must be at least 102% of
the aggregate uninsured deposits.
The State Commissioners for banks and financial services are required by Statute to monitor the
naming of eligible depositories and reporting of the uninsured deposits and assets maintained in
the collateral pools.
12
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 3 - CASH AND INVESTMENTS (CONTINUED)
Custodial Credit Risks— Deposits
For deposits, custodial credit risk is the risk that in the event of a bank failure, the District's
deposits may not he returned to it. The District does not have a deposit policy for custodial credit
risk. As of December 31, 2013, none of the District's bank balance of$87,078 was exposed to
custodial credit risk.
Credit Risk
The District has not adopted a formal investment policy, however, the District follows state
statutes regarding investments.
Colorado State statutes specify investment instruments meeting defined rating and risk criteria in
which local governments may invest which include:
* Obligations of the United States and certain U.S. government agency securities
• Certain international agency securities
• General obligation and revenue bonds of U.S. local government entities
• Bankers' acceptances of certain banks
• Commercial paper
• Written repurchase agreements collateralized by certain authorized securities
• Certain money market mutual funds
• Guaranteed investment contracts
* Local government investment pools
The District generally limits its concentration of investments to those noted with an asterisk (*)
above, which are believed to have minimal credit risk; minimal interest rate risk and no foreign
currency risk.
The local government investment pools include the Colorado Local Government Liquid Assets
Trust(ColoTrust) rated AAAm by Standard & Poor's.
Interest Rate Risk
Colorado revised statutes limit investment maturities to five years or less unless formally
approved by the Board of Directors, such actions are generally associated with a debt service or
sinking fund requirements.
13
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 3 -CASH AND INVESTMENTS (CONTINUED)
As of December 31, 2013 the District had the following investments:
Investment Maturity Fair Value
Colorado Liquid Asset Trust Less than one year $ 43,131
COLOTRUST
As of December 31, 2013 the District had invested in the Colorado Local Government Liquid
Asset Trust (ColoTrust), an investment vehicle established for local government entities in
Colorado to pool surplus funds. The State Securities Commission administers and enforces all
State statutes governing the Trust. The Trust operates similarly to a money market fund and each
share is equal in value to $1.00. The Trust offers shares in two portfolios, COLOTRUST PRIME
and COLOTRUST PLUS+. Both portfolios may invest in U.S. Treasury securities and
repurchase agreements collateralized by U.S. Treasury securities. COLOTRUST PLUS+ may
also invest in certain obligations of U.S. government agencies, highest rated commercial paper
and repurchase agreements collateralized by certain obligations of U.S. government agencies. A
designated custodial bank serves as custodian for the Trust's portfolios pursuant to a custodian
agreement. The custodian acts as safekeeping agent for the Trust's investment portfolios and
provides services as the depository in connection with direct investments and withdrawals. The
custodian's internal records segregate investments owned by the Trust. As of December 31,
2013, the District has $43,131 invested in COLOTRUST PRIME.
Concentration of Credit Risk
The District does not have a policy that addresses limitations on the amount that can be invested
in any one issuer, however, the District invests primarily in local government investment pools
and/or U.S. securities, which are not subject to concentration of credit risk.
14
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 4 — LONG-TERM OBLIGATIONS
The following is an analysis of changes in long-term obligations for the year ended December
31, 2013:
Balance at Balance at
January 1, December 31,
2013 Additions Reductions 2013
2012 Tax Free Loan $ 1,090,000 $ - $ 185,000 $ 905,000
Due in one year 185,000
Due after one year S 720,000
The detail of the District's long-term obligations is as follows:
$2,000,000 General Obligation Bonds, Series 1998, dated October I, 1998. On October 21,
1998, the District issued $2,000,000 in General Obligation Bonds for streets, water and park and
recreation improvements. The bonds are term bonds in the amount of$635,000 due October 1,
2009, $665,000 due October I, 2014 and $700,000 due October 1, 2018. The bonds were
currently subject to mandatory sinking fund redemption. Bonds maturing on and after October I.
2009 were callable at the option of the District beginning October 1, 2008 and thereafter without
call premium. Interest was payable semiannually at 6%, 6.4% and 7%, respectively. The bonds
were paid in their entirety from the proceeds of the 2012 Tax Free Loan.
$1,090,000 Tax Free Loan, dated December 20, 2012. In 2012 the District issued a Tax Free
Loan in the amount of$1,090,000, the proceeds of which were used to refund in its entirety the
remaining balance of its 1998 General Obligation Bonds in the amount of$990,000. The Loan
accrues interest at 2.28% per year and matures on October 1, 2018. The District realized a net
present value savings on the refunding in the amount of $65,650. The following is the debt
service schedule to maturity:
Year Principal Interest Total
2014 $ I85O00 $ 20,634 $ 205,634
2015 190,000 16,416 206,416
2016 195,000 12,084 207,084
2017 195,000 7,638 202,638
2018 140,000 3,192 143,192
$ 905,000 S 59,964 $ 964,964
IS
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31,2013
NOTE 4- LONG-TERM OBLIGATIONS (CONTINUED)
On November 2, 2010 the voters of the District revoked all of its previous debt authorization and
authorized the following:
Maximum
Annual
Debt Maximum Property Tax
Authorization Interest Rate Increase
Street improvements $ 1,500,000 15% $ 320,000
Park and recreation improvements 1,500,000 15% $ 320,000
Water improvements 1,500,000 15% $ 320,000
Total S 4,500,000
NOTE 5—RELATED PARTIES
The primary developer of real property in the District is R.E.I. Limited Liability Company
(Developer), successor in interest to Beebe Draw Farms, Ltd. All Directors are residents of the
District.
NOTE 6—RISK MANAGEMENT
The District is exposed to various risks of loss related to thefts of, damage to, or destruction of
assets; errors or omissions; injuries to employees, or acts of God.
The District is a member of the Colorado Special Districts Property and Liability Pool (Pool) as
of December 31, 2013. The Pool is an organization created by intergovernmental agreement to
provide property, liability, public officials liability, boiler and machinery and workers
compensation coverage to its members. Settled claims have not exceeded this coverage in any of
the past three fiscal years.
The District pays annual premiums to the Pool for liability, property and public officials liability
coverage. In the event aggregated losses incurred by the Pool exceed amounts recoverable from
reinsurance contracts and funds accumulated by the Pool, the Pool may require additional
contributions from the Pool members. Any excess funds which the Pool determines are not
needed for purposes of the Pool may be returned to the members pursuant to a distribution
formula.
16
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 7-TAX, SPENDING AND DEBT LIMITATIONS
Article X. Section 20 of the Colorado Constitution. commonly known as the Taxpayer's Bill of
Rights (TABOR) contains tax, spending, revenue and debt limitations which apply to the State of
Colorado and all local governments.
Spending and revenue limits are determined based on the prior year's Fiscal Year Spending
adjusted for allowable increases based upon inflation and local growth. Fiscal Year Spending is
generally defined as expenditures plus reserve increases with certain exceptions. Revenue in
excess of the Fiscal Year Spending limit must be refunded unless the votes approve retention of
such revenue.
TABOR requires local governments to establish Emergency Reserves. These reserves must be at
least 3% of Fiscal Year Spending (excluding bonded debt service). Local governments are not
allowed to use the emergency reserves to compensate for economic conditions, revenue
shortfalls, or salary or benefit increases. The District has reserved $5,926 in compliance with the
emergency reserve.
The District management believes, after consultation with legal counsel, that it is in compliance
with the provisions of TABOR. However, TABOR is complex and subject to interpretation.
Many of the provisions, including the interpretation of how to calculate Fiscal Year Spending
limits will require judicial interpretation.
On November 3, 1998, the voters of the District approved the retention of all property taxes
collected from a levy of 40 mills and all other District revenue in 1998 and annually thereafter
without limitation under TABOR or other laws.
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
NOTES TO FINANCIAL STATEMENTS
December 31, 2013
NOTE 8—INTERGOVERNMENTAL AGREEMENTS
Beebe Draw Farms Authority Establishing Agreement(AEA)
Effective April 12, 2011 the District entered into an Establishment Agreement with the Beebe
Draw Farms Metropolitan District No. 2 and the Beebe Draw Farms Authority (AEA), as
amended December 11, 2012. The District, through the Authority, will provide for financing the
operations and maintenance of the existing public improvements as well as providing for
financing, constructing and operating and maintaining additional public improvements. In no
case shall the mill levy imposed by the District for debt service and operations and maintenance
exceed its' respective mill levy caps. Other than the existing 2012 Tax Free Loan and the Capital
Pledge Agreement(see Note 10), the District will not issue any additional debt.
As a part of the Establishing Agreement, District No .1 has agreed to impose the District required
mill levy until 2018 and to transfer such revenues to the Authority for deposit into either the
infrastructure account or the amenity account. For tax collection year 2011 and thereafter the
District shall transfer all revenues from the operations and maintenance mill levy less the
Districts direct operations and maintenance costs to the Authority.
NOTE 9—RECONCILIATION OF GOVERNMENT-WIDE AND FUND
FINANCIAL STATEMENTS
Explanation of differences between the governmental fund Balance Sheet and the
government-wide Statement of Net Position
The governmental fund Balance Sheet and the government-wide Statement of Net Position
includes a reconciling column. Explanation of the adjustments included in the reconciling
column is as follows:
Long term debt $ 905,000
Accrued interest payable $ 1,719
Long-term liabilities are not due and payable in the current period and therefore are not reported
in the funds.
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BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
NOTES TO FINANCIAL STATEMENTS
• December 31, 2013
NOTE 9— RECONCILIATION OF GOVERNMENT-WIDE AND FUND
FINANCIAL STATEMENTS (CONTINUED)
Explanation of differences between the governmental fund Statement of Revenue,
Expenditures and Changes in Fund Balance and the government-wide Statement of
Activities
The governmental fund Statement of Revenue, Expenditures and Changes in Fund Balance and
the government-wide Statement of Activities include a reconciling column. Explanation of the
adjustments included in the reconciling column is as follows:
Bond principal S (185,000)
Interest expense S 103
Governmental funds report principal payments as expenditures. However in the Statement of
Activities, the payment of principal is reflected as a reduction in long-term liabilities. Interest is
expensed when paid in the government funds but net accrued interest (difference between the
beginning and ending accrual) is reelected in the Statement of Activities.
NOTE 10—CAPITAL PLEDGE AGREEMENT
The District has an Amended and Restated Consolidated Service Plan for Beebe Draw Farms
Metropolitan District No. I and Beebe Draw Farms Metropolitan District No. 2 approved by the
Weld County Board of County Commissioners on March 16, 2011 ("Amended and Restated
Service Plan"). Pursuant to the Amended and Restated Service Plan, and subject to the
conditions of the Amended and Restated Service Plan, on June 14, 2011, District No. l entered
into a Capital Pledge Agreement (the Original Capital Pledge Agreement) between Beebe Draw
Farms Metropolitan District No. I and the Beebe Draw Farms Authority with a principal amount
of 51,500,000, plus interest at a rate of 15%. The mill levy for payment of this obligation is
capped at 40 mills, minus the 1998 Bond Mill Levy for each year and less the Operating and
Maintenance Mill Levy for each year, to be imposed for collection beginning in 2012 and ending
in tax collection year 2018. The total debt repayment will be the lesser of the $1,500,000, plus
15% interest accrued per annum or the total revenue that flows from the imposition of the 40
mills, minus the 1998 Bond Mill Levy and the Operating and Maintenance Mill Levy, over the
2012-2018 term of the mill levy imposition.
On December 20, 2012, with the support of Beebe Draw Farms Metropolitan District No. 2,
Beebe Draw Farms Metropolitan District No. 1 and the Beebe Draw Farms Authority entered
into that certain First Amendment to District No. I Capital Pledge Agreement ("First Amended
Capital Pledge Agreement"), wherein Beebe Draw Farms Authority consented to the issuance of
Beebe Draw Farms Metropolitan District No. I's 2012 Bonds and waived any limitations set
forth in the Original Capital Pledge Agreement to the extent necessary for Beebe Draw Farms
Metropolitan District No. I to issue its 2012 Bonds.
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SUPPLEMENTAL INFORMATION
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. I
CONSERVATION TRUST
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES— BUDGET AND ACTUAL
Year Ended December 31, 2013
Variance with
Final Budget
OriginaU Actual Positive
Final Budget Amounts (Negative)
REVENUES
Interest income $ — S 1 S 1
Lottery funds 500 303 (197)
Total revenues 500 304 (196)
NET CHANGE IN FUND BALANCE 500 304 (196)
FUND BALANCE—BEGINNING OF YEAR 4.537 4,317 (220)
FUND BALANCE— END OF YEAR S 5,037 S 4,621 $ (416)
NOTE: The accompanying notes'are an integral part of the financial statements.
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BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES—BUDGET AND ACTUAL
Year Ended December 31, 2013
Variance with
Final Budget
Original Actual Positive
Budget Final Budget Amounts (Negative)
REVENUES
Property taxes $ 233,832 $ 233,832 $ 232.173 $ (1,659)
Interest income 50 30 31 1
Total revenues 233,882 233,862 232,204 (1,658)
EXPENDITURES
Bond interest 19,467 19,398 19,398 —
Bond principal 185,000 185,000 185,000 —
Bond issuance costs — 1,075 1,075 —
Treasurer's fees 3.507 3,507 3,491 16
Paying agent fees 150 1,020 425 595
Total expenditures 208,124 210,000 209,389 611
EXCESS(DEFICIENCY)OF
REVENUES OVER
EXPENDITURES 25,758 23,862 22,815 (1,047)
NET CHANGE IN FUND
BALANCE 25,758 23,862 22,815 (1,047)
FUND BALANCE-BEGINNING
OF YEAR 43,346 53,737 53,738 1
FUND BALANCE-END OF
YEAR $ 69,104 $ 77,599 $ 76,553 $ (1,046)
NOTE: The accompanying notes are an integral part of the financial statements.
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