FY 2020 CAFR FinalKA ISPELL
CITY OF KALISPELL, MONTANA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR 2020 July 1, 2019 - June 30, 2020
CITY OF KALISPELL
ANNUAL FINANCIAL REPORT
TABLE OF CONTENTS
INTRODUCTORY SECTION
Letterof Transmittal............................................................................................................................................ 3-8
Government Finance Officers' Association Certificate of Achievement.......................................................... 9
OrganizationalChart........................................................................................................................................... 10
City Elected and Appointed Officials.................................................................................................................. 11
FINANCIAL SECTION
IndependentAuditor's Report............................................................................................................................12-14
Management's Discussion and Analysis.............................................................................................................15-26
Basic Financial Statements:
Government -wide Financial Statements:
Statementof Net Position.....................................................................................................................
27
Statementof Activities.........................................................................................................................
28
Governmental Fund Financial Statements:
Balance Sheet — Governmental Funds................................................................................................
29
Reconciliation of the Balance Sheet — Governmental Funds to the Statement of Net Position......
30
Statement of Revenues, Expenditures, and Changes in Fund Balances — Governmental Funds..
31
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances -
Governmental Funds to the Statement of Activities......................................................................
32
Proprietary Fund Financial Statements:
Statement of Net Position — Proprietary Funds.................................................................................
33
Statement of Revenues, Expenses, and Changes in Net Position — Proprietary Funds ..................
34
Statement of Cash Flows — Proprietary Funds..................................................................................
35
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Position — Custodial Funds...................................................................
36
Statement of Changes in Fiduciary Net Position — Custodial Funds ...............................................
37
Notes to the Financial Statements............................................................................................................38-87
Required Supplementary Information other than Management Discussion and Analysis:
Schedule of City's Total Liability and Related Ratios — Other Post -Employment
HealthcareBenefits..............................................................................................................................
88
Schedule of City Contributions — Other Post -Employment Healthcare Benefits ............................
89
Schedule of Proportionate Share of the Net Pension Liability/Schedule of Contributions —Post-
Employment Benefits/Required Notes............................................................................................90-97
Budgetary Comparison Schedule — General and Major Special Revenue/Required Notes 98-100
Supplemental Information:
Combining and Individual Governmental Fund Statements and Schedules:
Combining Balance Sheet — Nonmajor Governmental Funds.........................................................101-107
Combining Statement of Revenues, Expenditures and Changes in Fund Balances —
Nonmajor Governmental Funds....................................................................................................108-114
Budgetary Comparison Schedule —
Nonmajor Governmental Funds.................................................................................... ............115-132
Combining and Individual Proprietary Fund Statements:
Combining Statement of Net Position — Nonmajor Proprietary Funds .........................................
133
Combining Statement of Revenues, Expenditures, and Changes in Fund Net Position — Nonmajor
ProprietaryFunds..........................................................................................................................
134
Combining Statement of Cash Flows — Nonmajor Proprietary Funds ..........................................
135
CITY OF KALISPELL
ANNUAL FINANCIAL REPORT
TABLE OF CONTENTS
STATISTICAL SECTION
Financial Trends
NetPosition by Component..................................................................................................................... 136
Changesin Net Position........................................................................................................................... 137
Fund Balances of Governmental Funds................................................................................................. 138
Changes in Fund Balances, Governmental Funds................................................................................ 139
Revenue Capacity
Market Value of Taxable Property......................................................................................................... 140
Direct and Overlapping Property Tax Rates......................................................................................... 141
Principal Property Tax Pavers............................................................................................................... 142
Property Tax Levies and Collections...................................................................................................... 143
Debt Capacity
Ratios of Outstanding Debt by Type...................................................................................................... 144
Ratios of General Bonded Debt Outstanding........................................................................................ 145
Legal Debt Margin Information............................................................................................................. 146
Direct and Overlapping Governmental Activities Debt........................................................................ 147
Pledged Revenue Coverage ..................................................................................................................... 148
Demographics and Economics
Demographic and Economic Statistics................................................................................................... 149
PrincipalEmployers................................................................................................................................ 150
Operating Statistics
Full-time Equivalent City. Government Employees by Function/Program......................................... 151
Operating Indicators by Function.......................................................................................................... 152
Capital Assets Statistics by. FunctionlPrograin..................................................................................... 153
Additional Information
TheWater System.................................................................................................................................... 154
TheSewer System.................................................................................................................................... 155
Tax Increment District Information.......................................................................................................156-160
Special Improvement District Information............................................................................................ 161
General Obligation Debt Ratios.............................................................................................................. 162
REPORTS OF INDEPENDENT PUBLIC ACCOUNTANTS
Schedule of Expenditures of Federal Awards and Notes................................................................................. 163
Notes to the Schedule of Federal Awards......................................................................................................... 164
Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting
based on an Audit of Financial Statements Performed in Accordance with Government
AuditingStandards................................................................................................................................. 165-166
Independent Auditor's Report on Compliance for Each Major Program and Report on Internal Control
Over Compliance in Accordance with OMB Circular A-133............................................................... 167-168
Schedule of Findings and Questioned Costs..................................................................................................... 169-170
2
INTRODUCTORY
SECTION
I=— ir %9"W6
0211P
KA SPELL
December 21, 2020
City of Kalispell
Post office Box 1997 - Kalispell, Montana 59903-1997
Telephone (406) 758-7701 Fax - (406) 758-7758
To the Honorable Mayor, members of the City Council, and Citizens of the City of Kalispell,
Montana:
CAFR TRANSMITTAL
State law requires that all general-purpose local governments publish within six months of the
close of each fiscal year (by December 31) a complete set of financial statements presented in
conformity with generally accepted accounting principles (GAAP). State law also requires a
biannual audit of these statements in accordance with generally accepted auditing standards by a
firm of licensed certified public accountants to be completed within 9 months of the close of
every other fiscal year (by March 31). It is the belief of the City Council and the Executive staff
that an annual audit assures a higher level of financial management and fiscal responsibility.
Pursuant to this policy and these requirements, the audited annual financial report for the City of
Kalispell, Montana for the fiscal year ended June 30, 2019, is submitted for your review.
Management Representation
The Finance Office prepared this report. Responsibility for the accuracy and completeness of
the presented data, including all disclosures, rests with the City. We believe the data, as
presented, is accurate in all material aspects. The material is presented in a manner designed to
state fairly the financial position and results of operations of the City as measured by the
financial activity of its various funds. All disclosures necessary to enable the reader to gain an
understanding of the City's financial affairs have been included.
To provide a reasonable basis for making these representations, management of the City has
established and maintains an internal control system designed to ensure that the assets of the
City are protected from loss, theft or abuse. The internal control system has been designed to
also ensure that adequate accounting data are compiled to allow for the preparation of financial
statements in conformity with accounting principles generally accepted in the United States (US
GAAP) and to comply with laws and regulations. The system of internal control is designed to
provide reasonable, but not absolute, assurance that these objectives are met. The concept of
reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits
likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments
by management.
3
Independent Auditor
Wipfli LLP, a firm of licensed certified public accountants has audited the financial statements
of the City. The goal of the independent audit was to provide reasonable assurance that the
financial statements of the City for the fiscal year ended June 30, 2020, are free of material
misstatement. The independent audit involved examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements; assessing the accounting principles used
and significant estimates made by management; and evaluating the overall financial statement
presentation. The independent auditors concluded, based upon the audit, that there was a
reasonable basis for rendering an unmodified opinion that the City's financial statements for the
fiscal year ended June 30, 2020, are fairly presented in conformity with US GAAP. The
independent auditor's report is presented as a component of the financial section of this report.
Transmittal Letter
GAAP require that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A). The letter of transmittal is designed to complement MD&A and should be read in
conjunction with it. The City of Kalispell's MD&A immediately precedes the City's basic
financial statements within this report.
Profile of the City of Kalispell
The City of Kalispell, incorporated in 1892, is the county seat of Flathead County located in the
western part of the State of Montana. This historically has been one of the top growth areas in
the state. The City of Kalispell is empowered to levy a property tax on both real and personal
properties located within its boundaries. It also is empowered by state statute to extend its
corporate limits by annexation, which occurs periodically when deemed appropriate by the
governing council.
The City of Kalispell operates under the council-manager form of government. Policy -making
and legislative authority are vested in a governing council consisting of the mayor and eight
other members. The governing council is responsible for, among other things, passing
ordinances, adopting the budget, appointing boards, and hiring the City Manager. The City
Manager is responsible for carrying out the policies and ordinances of the governing council, and
for overseeing the day-to-day operations of the City. The council is elected on a non -partisan
basis. Council members are elected by district to serve four-year staggered terms, with four
council members elected every two years. The mayor is elected at large for a four-year term.
All significant operations of the City, as defined by the National Council of Governmental
Accounting, Statement #3, have been included in the accompanying financial statements. The
City provides a full range of municipal services including police, fire, building, planning and
zoning, city court, parks and recreation, streets, community development, and general
administrative services. The City also operates as Enterprise funds: water, sewer, and solid
waste.
In addition, the City presents financial data for two component units on the combined statements.
The Downtown Business Improvement District and the Tourism Business Improvement District
are both discretely presented governmental type component units.
91
The annual budget serves as the foundation for the City of Kalispell's financial planning and
control. All departments of the City of Kalispell are required to submit requests for
appropriation to the City Manager. The City Manager uses these requests as the starting point
for developing a proposed budget. The City Manager then presents this proposed budget to the
council for review. The council is required to hold public hearings on the proposed budget and
to adopt a final budget. The appropriated budget is prepared by fund, function, and department.
Budgetary control is decentralized to the point that departments are responsible for expending
within fund budgetary limits.
Budget to Actual Comparisons
The State municipal budget law stipulates that money, other than payments from agency funds,
may not be drawn from the treasury of a municipality except pursuant to an appropriation.
Therefore, a legally adopted budget is required for all funds, with the exception of agency funds.
The City legally adopts a budget for the required funds. Consistent with past years, the City
established the legal spending level at the fund level for the fiscal year 2020 budget. The City
Manager and Finance Director may make transfers of appropriations within a fund. Transfers
between funds, however, require approval of the City Council. Budget -to -actual comparisons
are provided in the report for each individual governmental fund for which an appropriated
annual budget has been adopted. For the general fund, the comparison is part of the required
supplementary information.
Factors Affecting Financial Condition
The City has started to see new construction comparable to the first few years of this century and
home foreclosures have slowed substantially. The pandemic of 2020 did not stop Northwest
Montana growth, with many estimates showing growth beyond that of the early 2000's.
Kalispell Regional Medical Center continues to grow and, although they are considered not for
profit, their expansion helps the City's economy in many other ways. Healthcare, in general, has
grown over 180% since 1990 and now employees over 6,300 people in Flathead County.
Economist are predicting a 2.1 percent per year increase in health care employment
opportunities.
Although Kalispell is not in close proximity of a major metropolitan center, hundreds of
technology and manufacturing companies, from computer equipment to food and beverage to
pharmaceuticals, have found the area to be favorable for their operations.
Tourism is one of the area's major economic drivers. With Glacier National Park visitations
setting annual records, a major ski resort within a few miles, the proximity to Canada, and other
shoulder season draws, there is not many days of the year that visitors do not purchase services
in Kalispell and the Flathead Valley.
Montana experienced a population increase between the 2010 census and 2020 estimate of
almost 9.7 percent. Kalispell, however, experienced an increase of about 26 percent, while
Flathead County experienced growth around 17 percent. The 2020 (most current) estimated
population of Kalispell is 25,288 according to the U.S. Census Bureau.
The unemployment rate for the June of 2020 for the City of Kalispell was a pandemic related 9.2
percent. This is up from the June 2019 rate of 4.2 percent. The most current Montana
unemployment rate (Bureau of Labor Statistics) for October 2020, is 4.9%. In comparison, the
National unemployment rate for October was 6.9 percent.
According to the United States Census Bureau, the per capita income for the City of Kalispell
was $24,614 in 2018 dollars. This is about 18% less than Flathead County's estimated per capita
income ($30,068), and 17% less than Montana's estimated per capita income (29,765). Per
capita income for the United States is estimated to be $32,621 in 2018 dollars.
Revenue Growth and Reform
City revenues can be considered statutorily limited, circumstantial or discretionary. The City has
very little control over the growth of restricted and circumstantial revenues. Although the City
`controls' the growth or discretionary revenue, it is still subject to typical community pressures
for conservative growth.
Since November 1986 and the passage of Initiative 105, which limited certain property taxes to
the 1986 levels, the ability of the City to raise revenue for basic services is increasingly difficult.
Then, the legislature, with SB 184, lowered tax rates forcing the City to increase mill levies to
maintain the same level of revenue. The City's cash reserves in most funds vary between 10%
and 20% of appropriations. State law allows for reserves of 50%. Reserves provide for cash flow
between tax revenue receipts to keep the City from having to borrow funds for operations.
Additional revenues generated by increased taxable valuation come with the additional costs of
an increased service area. The City of Kalispell's Police and Fire Departments, Courts system,
Building Department, Public Works and Parks have felt the increased pressure from the influx of
people to Flathead County. These pressures impact the budgets of all departments.
The Montana constitution and state law require periodic reappraisal of property in the interest of
equal taxation (15-7-111, MCA). The State of Montana, through the Department of Revenue
(DOR), is responsible for valuing all taxable real and personal property. Every other year, the
DOR is required by state law to conduct a reappraisal of residential, commercial, industrial,
agricultural and foresdand property in the state.
New reappraisal values were used for property tax purposes in tax year 2019 (fiscal year 2020).
Statewide, taxable values rose about 12.5%. In Flathead County, reappraisals resulted in a
taxable value increase of about 10%. The City of Kalispell also showed an increase of over
11 %.
Other Postemuloyment Benefits — GASB Statement 75
The City of Kalispell reported the net opeb liability, required under the Governmental
Accounting Standards Board (GASB) Statement No. 75, in fiscal year 2018 and the related
financial statements. Although the City reported this liability, related deferred outflows, and
related expenses and expenditures, the City does not agree that this represents a legal liability
and fiu-ther believes that the presentation of this activity in the financial statements will
eventually be misleading to the users of the statements. In this, the 4th year of GASB 75
implementation, the recorded net opeb liability is $3,334,026. This liability was reported in
fiscal year 2016 as net opeb obligation ($2,110,870) under GASB 45 guidance. Under GASB 45
guidance, the City was able to amortize the remaining liability over 30 years. The City is now,
under GASB 75, required to record the entire liability.
The City plans to continue funding the employee health insurance plan on a "pay as you go"
basis, and does not plan to fund this liability. City management feels it would be fiscally
irresponsible to take an amount equal to the actuarially determined liability and place it in an
irrevocable trust fund that would never be used and would most likely increase as the City, and
the related number of employees serving it, continues to grow. Retirees can leave the plan at any
time and the City would have unwisely used funds collected from its citizens. Insurance rates
have been historically set so each plan offered is fiscally sound. Rates can be changed and
benefits altered at any time to ensure the plans remain properly funded.
Because the City will not be funding this liability, it will continue to increase. The financial
statements will reflect the impact of this very large net opeb liability. Management does not feel
it has legal substance as nothing in state law or any contractual agreement requires the city to
offer the same rates to retirees, spouses and their dependents as other participants.
Maior Initiatives
On December 4, 2017, the Kalispell City Council adopted The Downtown Plan as an amendment
to the City of Kalispell Growth Policy Plan by Resolution No. 5846. The Downtown Plan
addresses a number of key topics that affect the future growth and development of Downtown
Kalispell. A number of goals/guiding principles were identified within the implementation
chapter of The Downtown Plan. Goal/guiding principle number three states "creation of a
downtown Tax Increment Finance District to assist with implementation of this plan." The tax
increment funds could be used for appropriate public infrastructure projects in support of the
redevelopment of blighted conditions.
On April 21, 2014, the City Council voted unanimously to annex 40.69 acres located on the east
side of Whitefish Stage Road, north of East Oregon Street, and west of East Oregon Lane
(formerly McElroy -Wilkins gravel pit). The owner of this property, Flathead County Economic
Development Authority, intends to develop a rail -served industrial park. This rail park will be
the new home of several of the rail -served industrial business that are currently located within
the City of Kalispell's Core Area, as well as provide additional rail -served industrial land for
other business ventures. The proposed rail -served industrial park and relocation of industrial
uses out of the Core Area will facilitate removal of the railroad tracks from the Core Area and
encourage commercial investment in the recently expanded Westside Urban Renewal Tax -
Increment Finance (TIF) District.
In October of 2015, the City of Kalispell was awarded a $10 million Transportation Income
Generating Economic Recovery (TIGER) grant from U.S. Department of Transportation to help
fund the Glacier Rail Park and Kalispell Core Area Development projects. The emphasis of this
grant will be to remove the railroad tracks from the City of Kalispell to assist further
development without the tracks being an impediment, and to construct a Rail Park outside of the
core area, to accommodate establishments that need or prefer rail service for their business.
7
Awards and Acknowledgments
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
Kalispell for its comprehensive annual financial report for the fiscal year ended June 30, 2019.
This was the tenth consecutive year that the City of Kalispell had submitted and achieved this
prestigious award. In order to be awarded a Certificate of Achievement, a government must
publish an easily readable and efficiently organized comprehensive annual financial report. This
report must satisfy both generally accepted accounting principles and applicable legal
requirements. A Certificate of Achievement is valid for a period of one year only. We believe
that our current comprehensive annual financial report continues to meet the Certificate of
Achievement Program's requirements and we are submitting it to the GFOA to determine its
eligibility for another certificate.
The completion of the Annual Financial Report on a timely basis was made possible by the entire
staff of the Finance Department and the cooperation of all City departments. I would also like to
give recognition to the mayor, governing council, and the city manager for their consistent
support for maintaining the highest standards in the management of the City of Kalispell's
finances.
Respectfully submitted,
Rick Wills
Finance Director
M
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Kalispell
Montana
For its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
June 30, 2019
lJ
Executive Director/CEO
6
MUNICIPAL JUDGE
Loci Adams
CITY CLERK
Aimee Brunckhorst
CITY OF KALISPELL, MONTANA
ORGANIZATIONAL CHART
CITIZENS OF KALISPELL
WARD
Kan Ga6tiel
iandv Carlson
FINANCE
Rick Wills
CITY COUNCIL
MAYOR
.Mark Johnson
WARD II WARD III
Sam NunnaRy Kyle Waterman
CITY MANAGER
Doug Russel!
RESODenise HUMAN
ichel � I P Srsie rimier WORKSBLIC I I TE INFORMATIONHNOLOGY Erika afflef
10
WARD IV
Tom Kluesner
Sid Daoud
PLANNING, PARKS &
BUILDING & RECREATIDN
COMMUNITY Chad Fischer
D5,,APMg ENT
PUBLIC SAFETY PUBLIC SAFETY LEGAL
FIRE POLICE Charbe Harball
Dave Dedman Doug Overman
CITY OF KALISPELL, MONTANA
CITY ELECTED AND APPOINTED OFFICIALS
TERM
ELECTED OFFICIALS EXPIRES
Mayor Mark Johnson 12/2021
Council members:
Kari Gabriel
Ward I
1212023
Kyle Waterman
Ward III
12/2021
Sandy Carlson
Ward I
12/2021
Ryan Hunter
Ward III
12/2023
Sam Nunnally
Ward II
12/2023
Sid Daoud
Ward IV
12/2023
Chad Graham
Ward II
1212021
Tim Kluesner
Ward IV
1212021
Municipal Court Judge:
Lori Adams
12/2021
APPOINTED CITY OFFICIALS
City Manager
City Attorney
City Clerk
Police Chief
Fire Chief
Finance Director
Public Works Director
Parks Director
Planning, Building, Community Dev.
Human Resource Director
City Treasurer
11
Doug Russell
Charles Harball
Aimee Brunckhorst
Doug Overman
Dave Dedman
Rick Wills
Susie Turner
Chad Fincher
Jarod Nygren
Denise Michel
Julie Hawes
FINANCIAL
SECTION
INDEPENDENT AUDITOR'S
INDEPENDENTAUDITOR'S REPORT
City Council Members
City of Kalispell
Kalispell, Montana
Report on the Financial Statements
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 Kalispell, Montana (the City), as of and for the year ended June 30, 2020 and
the related notes to the financial statements, which collectively comprise the City's basic financial statements
as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States; this includes the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of
financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor's judgment, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities, the business -type activities, the aggregate discretely
presented component units, each major fund, and the aggregate remaining fund information of the City of
Kalispell, as of June 30, 2020, and the respective changes in financial position and, where applicable, cash
flows thereof for the year then ended in accordance with accounting principles generally accepted in the United
States.
12
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States require that the management's discussion and
analysis, Schedule of City's Total OPEB Liability, Contributions and Related Ratios for the OPEB plan,
Schedules of Proportionate Share of the Net Pension Liability, Schedules of Contributions, and Budgetary
Comparison Schedules as listed on the table of contents be presented to supplement the basic financial
statements. Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for
placing the basic financial statements in an appropriate operational, economic, or historical context. We have
applied certain limited procedures to the required supplementary information in accordance with auditing
standards generally accepted in the United States, which consisted of inquiries of management about the
methods of preparing the information and comparing the information for consistency with management's
responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of
the basic financial statements. We do not express an opinion or provide any assurance on the information
because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any
assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City's basic financial statements. The introductory section, combining and individual non -major
fund financial statements, non -major budgetary comparisons, and the statistical section, are presented for
purposes of additional analysis and are not a required part of the financial statements. The schedule of
expenditures of federal awards is presented for purposes of additional analysis as required by Title 2 U.S. Code
of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The combining and individual non -major fund financial statements, non -major budgetary comparisons, and
schedule of expenditures of federal awards, are the responsibility of management and were derived from and
relate directly to the underlying accounting and other records used to prepare the financial statements. Such
information has been subjected to the auditing procedures applied in the audit of the basic financial statements
and certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States. In our opinion, the combining and individual non -major fund financial statements,
budgetary comparisons, and schedule of expenditures of federal awards, are fairly stated in all material respects
in relation to the financial statements as a whole.
The introductory section and statistical section have not been subjected to the auditing procedures applied in
the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
13
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 21,
2020, on our consideration of the City'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 solely 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 effectiveness of
the City's internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Govemment A uditing Standards in considering the City's internal control over
financial reporting and compliance.
Wipfli LLP
Helena, Montana
December 21, 2020
14
MANAGEMENT'S DISCUSSION
AND ANALYSIS
MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Kalispell, we offer readers of the City of Kalispell's financial
statements this narrative overview and analysis of the financial activities of the City of Kalispell
for the fiscal year ended June 30, 2020. We encourage readers to consider the information
presented here in conjunction with additional information that we have furnished in our letter of
transmittal.
FINANCIAL HIGHLIGHTS
➢ The assets and deferred outflows of the City of Kalispell exceeded its liabilities and deferred
inflows at the close of the most recent fiscal year by $188,543,336 (net position). Of this
amount, $23,204,892 (unrestricted net position) may be used to meet the government's
ongoing obligations to citizens and creditors.
Total City net position decreased by $1,371,889 over the prior fiscal year. Part of the
reduction in net position can be attributed to the nontypical contribution of infrastructure,
valued over $8,900,000, to another governmental entity. Developer's contributed over
$5,000,000 of water and sewer infrastructure to the City.
➢ As of June 30, the City's governmental funds reported combined ending fund balances of
$24,051,370, an increase of $2,124,832 over the prior year. Of this amount, $4,253,216
(17.7%) is available for spending at the government's discretion (committed, assigned, and
unassigned fund balances).
➢ At fiscal year-end, the total of the committed, assigned, and unassigned components of, fund
balance for the general fund was $4,253,391 or 34.0% of fiscal year 2020 total general fund
expenditures.
The City's total debt, excluding compensated absences, pensions, and other post
employment benefits, decreased by $547,960 (1.68%) during fiscal year 2020. Debt of
governmental activities decreased (13.8%) as no new loans were incurred. Business -type
activities debt increased (3.4%). Montana State Revolving Loans (SRF) were drawn on
in both sewer and water funds, increasing SRF debt by $1,183,187.
AN OVERVIEW OF THE FINANCIAL STATEMENTS
There are three main components to the City of Kalispell's financial statements: 1) government -
wide financial statements, 2} fund financial statements, and 3} notes to the financial statements.
Other supplementary material is included in this report in addition to the basic financial
statements themselves. The City of Kalispell intends for this discussion and analysis to be used
in conjunction with the basic financial statements, and other material, as an introduction and also
as a means to help the user better understand the information.
Government -wide Financial Statements
The government -wide financial statements are designed to provide readers with a broad
overview of the City of Kalispell's finances. The way information is presented in these
statements is comparable to how the financial information of a private -sector business would be
presented.
15
The statement of net position presents information on all of the City of Kalispell's assets and
deferred outflows of resources, and liabilities and deferred inflows of resources. The difference
between these two (assets and deferred outflows of resources minus liabilities and deferred
inflows of resources) is reported as net position. Net position can be a useful tool in evaluating
the financial health of an entity. A substantial decrease in net position may be a sign of
deteriorating financial outlook.
The change in net position during the most recent fiscal period is presented by the statement of
activities. The statement of activities reports changes in net position at the time the event takes
place without regard to the corresponding cash transaction. This results in some revenues and
expenses being reported in this statement that will not result in cash flow until a future fiscal
period. Some examples of this would be uncollected but earned taxes and earned leave benefits.
The government -wide financial statements of the City of Kalispell are segregated to distinguish
between functions supported predominantly by taxes and intergovernmental revenues
(governmental activities) and those that are intended to recover the majority of their costs
through user fees and charges for services (business -type activities). The governmental activities
of the City of Kalispell include general government/administration, public safety, public works,
parks and recreation, and community development. The business -type activities of the City of
Kalispell include water distribution, sewer collection and treatment, and solid waste collection.
The government -wide financial statements include, in addition to the primary government
described in the above paragraph, a legally separate Business Improvement District and a legally
separate Tourism Business Improvement District. The financial information of these component
units is reported separately on the Government -wide financial statements.
Fund Financial Statements
The City of Kalispell, like most other governmental entities, uses fund accounting. Funds are set
up to account for specific activities or objectives of the government. Funds also aide in ensuring
compliance with legal requirements. The City of Kalispell categorizes its funds as either
governmental, proprietary, or fiduciary.
Governmental funds correspond with the functions reported as governmental activities in
the government -wide financial statements. Governmental fund financial statements, by
focusing on near -term inflows and outflows of spendable resources, may be more useful
in evaluating a government's short-term fiscal health than the government -wide financial
statements.
A reconciliation has been prepared to help users more easily compare the governmental
fund balance sheet to the government -wide statement of net position and the
governmental fund statement of revenues, expenditures, and changes in fund balance to
the government -wide statement of activities. These reconciliations can be useful in
contrasting, comparing and understanding the long-term impact (government -wide
statements) of near -term decisions (governmental fund statements).
The City of Kalispell maintains numerous individual governmental funds. The
governmental funds balance sheet and statement of revenues, expenditures, and changes
in fund balance present information separately only for funds which are considered
major. Major funds are determined by a formula which considers the percentage of total
governmental assets, liabilities, revenues, and expenditures contained in each individual
fund. The City of Kalispell has two major governmental funds; the General Fund
(always a major fund), and the Street Maintenance (special revenue) Fund. All non -
major funds are presented as a group.
The City of Kalispell adopts an annual appropriated budget for its funds. A budgetary
comparison statement has been provided for the general fund and the major special
revenue fund to demonstrate compliance with this budget.
➢ The City of Kalispell maintains two different types of proprietary funds. Enterprise
funds and internal service funds. Enterprise funds are used to report the same functions
presented as business -type activities in the government -wide financial statements. Water,
sewer, solid waste, and the airport make up the City of Kalispell's enterprise funds. The
City of Kalispell uses two internal service funds to accumulate and allocate its
information technology transactions and central garage transactions internally among its
various functions. Under the old reporting model internal service funds were reported as
proprietary funds because they recovered most of their cost through user fees from other
funds. Under the new model these funds are eliminated through an allocation process
and categorized as either a governmental or business -type activity. Because the City of
Kalispell's internal service funds benefit governmental more so than business -type
functions, they have been included within the governmental activities in the government -
wide financial statements.
Information in the proprietary fund financial statements is of the same type as that
provided in the government -wide financial statements, however, it is more detailed.
Individual fund data is provided for the airport fund, water fund, and the sewer fund,
classified as major funds. Individual data is not required for the solid waste fund and the
airport fund because they are not classified as major funds.
➢ The City of Kalispell maintains one fund to account for resources held by the
government for the benefit of outside parties. This fiduciary fund is not reflected in the
government -wide financial statements because the resources are not available to support
the City of Kalispell's own programs. The City of Kalispell must ensure that the assets
reported in this fund are used for their intended purpose. The accounting method used
for fiduciary funds is similar to that used for proprietary funds.
17
Notes to the Financial Statements
The information contained in the government -wide and fund financial statements is meant to be
used in concurrence with the notes to the financial statements. The notes present further detail of
the data provided by these statements.
Other Information
GASB Statement 75 — Accounting and Financial Reporting for Postemployment Benefits Other
Than Pensions schedules, GASB Statement 68 — Accounting and Financial Reporting for
Pensions schedules, and the general and major special revenue funds budgetary comparison
schedules is included in the section for required supplementary information on pages 88 - 100.
The combining statements for non -major governmental and non -major proprietary funds are
presented immediately following the required supplementary information section. Combining
and individual fund statements and schedules can be found beginning on page 101 of this report.
ANALYZING THE CITY AS A WHOLE
As mentioned prior, net position can be an important indicator of an entities financial well-being.
For the period ending June 30, 2020, the City of Kalispell's assets and deferred outflows of
resources exceeded liabilities and deferred inflows of resources by $188,543,336.
The largest portion of the City's net position ($146,309,593 or 78%) reflects its net investment in
capital assets (e.g., land, buildings, machinery and equipment, infrastructure). The City 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. A
summary of net position is shown in the following table.
Governmental
Business-tcpe
Activities
Activities
Change
Change
FY20
FY19
Inc(Dec)FY'20
FY'19
�eO
Current and Other Assets $ 29,752,200
$ 27,268,452
S 2,483.748
S 32,644,116
S 29,819.697
S 2.824,419
Capital Assets 78,933,953
91,230,705
S (12,296.752)
98,934,756
93,063253
5.871,503
Total Assets 108,686,153
118,499,157
(9,813.004)
131,578,872
122,882.950
8.695,922
Deferred Outflows of Resource 2,939,271 2,942,796 (3.525) 532,592 597.586 (64,994)
Long-term Liabilities Outstandi $ 20,007,876 $ 20,389,923 S (382.047) S 24,978,156 S 23,951.573 S 1.026,583
Other Liabilities 4,541,793 4,415,563 126.230 2,638,491 3,092.986 (454,495)
Total Liabilities 24,549,669 24,805,486 (255.817) 27,616,647 27,044.559 572,088
Deferred Inflow of Resources 2,464,197 2,608,058 (143.861) 563.039 600.666 (37,627)
Net position:
Net Investment in Capital Asses
71,130,497
82,128,310
(10,997.813) 75,179,096
70,085.780
5.093,316
Restricted
9,349,779
9,265,932
93.847 9,707,154
10,163.238
(456,084)
Unrestricted (deficit)
4,131,282
2,634,167
1,497.115 19,045,528
15,596.293
3.459,235
Total net position $
84,611,558
$ 94,028,409
S (9,416.851) S 103,931,778
S 95,835,311
S 8.096,467
18
An additional portion of the City's net position ($19,056,933 or 10%) represents resources that
are subject to external restrictions on how they may be used. The remaining balance of
unrestricted net assets ($23,176,810 or 12%) may be used to meet the City's ongoing obligations
to citizens and creditors.
At June 30, the City is able to report positive balances in all three categories of net position, both
for the City as a whole, as well as for its separate governmental and business -type activities.
Net position of the City decreased less than 1% for fiscal year 2020 in comparison to fiscal year
2019 ($189 million compared to $190 million).
Chan es im Net Position
Revenues
Program revanuxr (by major saurrae):
Charges for senices
Operating grants and condnbubuns
Capital grants and cantd avt a
Gml revsnuea (by major source):
Property tales for general purposes
Video poker apportionment
Miscellaneous
Interestli estment earnings
State entitlement
Gas Tax
Total revenues
Program expenses
General goiesnmem
Public safety
Public works
Parks and recreation
C'<-ty decelopntent
Debt Service -interest
water
Sewer
Solidwsste
Total expenses
Excess (deficiency) before
special items and transfers
Gain (lass) on sale of capital assets
Extraordinary item- Contribution to other Gov4
Increase (decrease) in net position
Net Position - beginumg
Restatement
Net Position - ending
Co erwueual Business-n-pe
Activities Acmities
Change Change
EY20 FY19 Inc(Dec)FP20 FY19 lac [Dec]
$ 9,122,010 $ 8,187,461 S (65.451) $ 12,944290 S 13297,256 $ (352,976)
3,473,490 1,841,137 1,632�353 55235 47,478 7,757
- 12�331,081 (12231,081) 5200256 6,536,160 (1235,904)
10,393.815
9,647,621
746,194 - - -
61200
60,675
525 - - -
67214
99,876
(32,662) - - -
262242
294576
(22.234) 412,935 410,448 2,487
3,425,997
3,014,251
411,746 - - -
935,851
699,060
146,791
S 26,641,919 S
36,155,738 S
(9,513,819) S 18,612.706 S 20,291,342 $ (1,678,636)
6,225,773 $ 6,078,813 S 146,960
11,738,977 11,186,487 552,490
4,432,162 5,778.281 (1246,119)
2271,145 2,530,660 (159,515)
2,048260 2,860,7% (812,536)
333,593 381,767 (48.174)
$ 3,134,112 S 3.042,213 $ 91,899
6,341,537 5,812,173 52%364
1,047.408 994,660 52,748
S 27,149,910 S 28.816,804 S (1,666,894) S 10,523.057 S %849,D46 i 674,011
S (507,991) S
7,33"34
S (7,846,925) S
8,089.649
S l%442,2% $
(2252,647)
6,500
6,500
-
(2,077,363)
2,077,363
S (9,960,047) S
(8,960,D47) S
-
S 209,531
(20%531)
S (9,461,538) S
7,338.y34
S (16,800,472) S
9,089.649
S 8,574,464 S
(484,815)
94,028.409
86,689,475
7,338,934
95,935,311
87,266,432
8,568,879
44.697
44,687
6.818
(5,585)
12,403
S 94,611.558 S
94,028,409
(9,416,851) S 103,931,778
S 95,835211
8,096,467
Governmental Activities. Governmental activities in fiscal year 2020 decreased the City's net
position by $9,461,538, almost $17,000,000 less than in fiscal year 2019 (an increase of
$7,338,934). Overall, revenues of the governmental funds decreased 26% ($9,513,819).
Expenses also decreased about 0.6% or $1,666,894. The key elements of the overall net position
change were:
Total program revenues decreased substantially ($10,764,179 or 48%), while general
revenues increased ($1,250,360 or 9%). Capital Grants and Contributions (program
revenues) were $12,331,081 less than fiscal year 2019. Most of this decrease can be
attributed to public works. Fiscal year 2019, City streets contributed by developer's
(about $10,000,000) was not duplicated in fiscal year 2020 and more than offset increases
in other program revenues for fiscal year 2020.
19
Public works and community development expenses decreased about 25% ($2,158,655),
while public safety expenses increased by $552,490. The decrease in both the public
works and community development expenses can be attributed to less activity in the
Glacier Rail Park in fiscal year 2020.
The following table and charts help illustrate the information presented above. The table and
bar chart present the cost and net cost (total cost less revenues generated by the activity)
of each of the City's largest programs; General Government (administration), Public Safety
(police and fire), Public Works (streets, light maintenance and signs and signals), Parks and
Recreation (parks, urban forestry, pool, etc.), and Community Development. Net cost shows the
financial burden placed on City taxpayers by each of these functions. The pie chart
illustrates the different revenue sources for the City's governmental activities and how
much each source contributes.
i4000000
12000Doo
10000Doo
E-8p00Doo
�-00000
4a00D00
2000D00
Cover umental Activities
ty function (in Milli—)
Total Cost Net Cost
of Services of Services
FY20
FYU
FY20
FM
General Govemment
62
6.1
5.4
3.2
Public Safety
11.7
112
5.8
7.0
Public Wodm
4.4
5.8
1.1
(7.9)
Parks and Recreation
24
2.5
13
12
Canmmnity Development
21
2.8
1.7
2.6
Debt Service
0.3
0.4
03
0.4
Totals
$ 27.1
$ 28.8
$ 15.6
$ 6.5
Expenses and Program Revenues - Govemmerdal Activities for fiscal year
2020
gen goVt pub safety pub works parkslrec corms dev
Activity
Revenue by source - eovemmental Activ@ies ffical year ZD20
Omer
5%
n tid-t
13%
Charges for services
30%
Property tares
39%
grants!
Operating
3-anic� -ribu ins
1?'4
0
Business -type activities. Business -type activities increased the City of Kalispell's net position
by $8,089,649, about 5.6% ($484,815) less than in fiscal year 2019. The factors leading to this
5.6% decrease were:
Overall, revenues of the City's business -type activities decreased $1,678,636. Most of
this decrease is in capital grants and contributions (developers contributions of
infrastructure in water, sewer and storm infrastructure) which decreased $1,335,904.
Program expenses increased slightly from the prior fiscal year. Expenses of the sewer
department, which includes the treatment plant and storm sewer, were up $529,364 (9%).
Much of this increase is due to an increase in GASB 68 pension expense ($150,000),
other personal services expense, and an increase in depreciation.
The following charts help illustrate the information presented above related to business -type
activities net position.
14000000
12000000
10000000
-Ea0000o0
D
0
Q6000000
us
4000000
2000000
0
Expenses and Program Revenues - Business -type Activities for fiscal year 2020
Oezpenses
Eprog rev
water sewer solid waste
Activity
Rerenues by Source - Business -type Activities For fiscal year 2020
Irriesm ktF Emnirgs
21
ANALYZING THE CITY'S INDIVIDUAL FUNDS
Governmental Funds
The focus of the City of Kalispell's governmental funds is to provide information on near -term
inflows, outflows, and balances of spendable resources (fund balance). Spendable fund balance
(restricted, committed, assigned, and unassigned) is a useful tool when assessing the net
resources a government has available to spend at the end of a fiscal period.
At the end of fiscal year 2020, the City of Kalispell's governmental funds reported combined
ending fund balances of $24,051,370, an increase of $2,124,832 in comparison with the prior
fiscal year. Approximately 10% of this amount ($2,507,173) constitutes unassigned fund
halance, which is available for spending at the City's discretion. The remainder of the fund
balance is either nonspendahle, restricted, or assigned to indicate that it is 1) not in spendable
form ($1,581,349), 2) restricted for particular purposes ($18,216,805), or 3) assigned for
particular purposes ($1,706,043).
The general fund is the chief operating fund of the City of Kalispell. At the end of fiscal year
2020 unassigned fund balance of the general fund was $2,507,348, while total fund balance was
$5,793,803. The fund balance increased $560,673 during fiscal year 2020. As a measure of the
general fund's liquidity, it may be useful to compare both unassigned fund balance and total fund
balance to total general fund expenditures. Unassigned fund balance represents approximately
20.0 percent of total general fund expenditures, while total fund balance represents
approximately 46.2 percent of that same amount. The general fund balance of $2,378,086 is non -
spendable and assigned as follows:
GENERAL FUND BALANCE - TOTAL
NONSPENDABLE
Long -tens recievables
Prepaids
TOTAL NONSPENDABLE
ASSIGNMENTS
Capital Equipment
Downtown Parking
Misc.
TOTAL ASSIGNMENTS
UNASSIGNED
$ 5J93,803
$ 1,300,000
$ 240,412
$ 1,540,412
$ 208,906
$ 23,542
$ 1,513,595
$ 1,746,043
$ 2,507,348
The Street Maintenance fund is a special revenue fund established to account for the
maintenance, construction, equipment and other costs incurred in the maintenance of the City's
streets. Assessments on properties within the City of Kalispell boundaries are the main source of
this funds revenue. At June 30, 2020, the fund balance of this fund was $3,090,567, a $164,613
increase from the prior fiscal year.
22
Proprietary Funds
The City of Kalispell's proprietary funds fmancial statements provide the same type of
information found in the government -wide financial statements, but in more detail. Unrestricted
net position and the total growth in net position of the proprietary funds by fund are:
Proprietary Fond Net Position
a£
Unrestricted
Unrestricted Change rn
% Change rn
Net Positron
Net Posrtwn Net Position
Net Positon
water
$ 10,484,045
55% 2,375,462
29%
Sewer
7,322,505
380/* 5,657,857
70%
Other
1,238,978
70% 56,330
1%
Total
$ 19,045,528
100% 5 8,089,649
100%
For the discussion regarding major changes in net position of the proprietary funds see the
explanation above in the business -type activities of the statement of activities.
GENERAL FUND BUDGETARY HIGHLIGHTS
The City of Kalispell's general fund expenditures budget for fiscal year 2020 was $13,497,601.
Actual expenditures for the year were $12,534,996, a favorable variance of $962,605. Actual
public safety expenditures were $893,344 less than budgeted, mostly attributable to personal
services savings.
Actual revenues of the general fund were $12,170,669, $830,140 less than the budgeted amount
of $13,000,809. Intergovernmental revenue ($3,841,755) was significantly under the fiscal year
2020 budgeted amount ($4,898,538). This negative variance was due to less than expected on -
behalf retirement revenue, and vacancy savings.
23
CAPITAL ASSETS AND DEBT AD -MINISTRATION
Capital Assets
At the end of 2020, the City of Kalispell has $177,868,709, net of depreciation, invested in a
broad range of capital assets, including police and fire equipment, streets, buildings, land, park
facilities, garbage collection equipment, and water and sewer lines.
CITY OF KALISPELL'S CAPITAL ASSETS
(NET OF DEPRECIATIONY
Governmental Business4ype Total
activities activities
Land
2020
$ 3,743,166 $
2019
3,743,166
2020
$ 354,021
2019
$ 354,021
2020
$ 4,097,187
2019
$ 4,697,187
Buildings
6,555,082
7,135,696
33,367
6,966
6,588,449
7,142,662
Improvements (not buildings)
6,581,945
6,998,182
6,581,945
6,998,182
Machinery and equipment
4,368,132
4,613,650
420,920
551,633
4,78%052
5,165,283
Infrastructure
55,887,555
58,219,647
55,887,555
58,219,647
Construction in Progress
1,798,073
10,520,364
14,968,095
17,947,746
16,766,168
28,468,110
Source of Supply
4,682,482
3,358,078
4,682,482
3,358,078
Pumping Plant
1,948,616
2,029,446
1,948,616
2,029,446
Treatment Plant
18,429,065
17.301.197
18,42%065
17,301,197
Transmission and Distribution 45,935,648 39,945,987 45,935,648 39,945,987
General Plant 481.468 419.278 481,468 419 278
service tunas mciuoea in governm
Major Governmental funds capital asset events during the fiscal year 2020 included the
following:
➢ Vehicles and other equipment with a cost basis of $493,462 were added. This included five
(5) new police vehicles, two (2) tactical rifles (donated), a dump truck, and two (2) pickups.
➢ Continued development of the core area trail at a cost of almost $300,000.
➢ Paved 17 alleys at a total cost of $72,253. Replaced 1,234, 4.1 blocks, of sidewalks valued
at $83,402.
➢ Disposed assets with a cost basis of $923,317. This included three (3) police vehicles with a
cost basis of almost $47,000, two (2) tactical rifles, and a John Deere tractor.
➢ Infrastructure from construction in progress with a value of $6,028,175 were contributed to
another governmental entity. Construction in progress with a cost basis of $2,931,872 was
reclassified as an expenditure/expense.
Major Business -type funds capital asset events during the fiscal year 2020 included the
following:
➢ Removed and replaced water mains on Conrad Drive and 1't Avenue West North at a cost of
$701,149.
➢ Installed over 14,0001inear feet of new water transmission main on Four Mile Drive.
➢ Constructed and placed a new water well into service at a cost of $1,433,855.
➢ 13,920 linear feet of new water main valued at $1,320,107 was installed and contributed to
the City by developers.
➢ Disposed fully depreciated assets of the water department with a cost basis of $1,156,180.
➢ Completed the replacement of the Secondary Digester Lid and placed into service at a cost of
$1,767,839.
➢ Finished rehabbing the black top at the City shop complex.
24
➢ 11,765 linear feet of new sewer main valued at $2,895,846 was installed and contributed to
the City by developers.
➢ Two (2) new lift stations were constructed and contributed to the City by developers.
➢ 6,959 linear feet of new stormwater main valued at $601,135 was installed and contributed to
the City by developers.
➢ Disposed fully depreciated assets of the sewer department, including storm, with a cost basis
of $266,834.
Additional information on capital assets can be found in the notes of the basic financial
statements (Note D. Capital Assets pages 50-52).
Debt
At the end of fiscal year 2020, the City of Kalispell had total long-term debt outstanding of
$32,020,813. Of this amount, $455,000 comprises debt backed by the full faith and credit of the
government and $4,600,000 represents bonds secured solely by specific revenue sources (i.e.,
revenue bonds). The remainder consists of $24,298,202 (increase from fiscal year 2019,
(westside interceptor/four mile drive borrowings) outstanding on State Revolving Fund loans for
construction/expansion of the wastewater treatment plant, the extension of sewer lines south on
Highway 93, the construction of a water storage facility and the related distribution/supply
system, and the removal and replacement of the water main on 4th Avenue East. There is also
$1,561,856 of special assessment debt for which the City of Kalispell is liable in the event of
default by the property owners subject to the assessment, and $1,105,755 of loans for the
purchase of other property and equipment ($644,059) and for gap lending ($461,696).
CITY OF KALISPELL'S OUTSTANDING DEBT
Governmental Business -type Total
activities activities
2020 2019 2020 2019 2020 2019
General obligation bands
$ 455,000
$ 940,000
$ -
$ - $ 455,000
940,000
RevenuelUrban Renewal bonds
4,600,000
4,965,000
$ -
$ 405,000 $ 4,600,000
5,370,000
SRF loans
542,542
567,498
23,755,660
22,572,473 24,298,202
23,139,971
Assessments
1,561,856
1,793,229
1,561,856
1,793,229
Contract debt/loans
1,105,755
1,325,573
-
- 1,105,755
1,325,573
Total
$ 8,265,153
$ 9.591,300
$23.755,660
$22,977,473 $ 32,020.813
$32,568,773
Other obligations of the City of Kalispell include accrued vacation pay and sick leave
(compensated absences, $1,907,617), OPEB liability ($3,334,026), and pension liability
($11,626,393). More detailed information about the City's long-term liabilities is presented in
the notes to the financial statements (Note E. Long -Term Debt pages 53-58).
25
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The City's elected and appointed officials considered many factors when adopting the fiscal year
2021 budget for tax rates and fees that will be charged by the business -type activities. Some of
these factors include: capital improvements identified in the City's Capital Improvement
Program, inflation rates, the City's collective bargaining units, the local economy, national and
world events, and the citizen's ability to pay. Inflation rates, as well as, interest rates have a
significant impact on the cost of City projects. The 2020 pandemic drove interest rates to almost
historically low levels and has seemingly ushered in a housing boom in the Flathead. Indications
have ranged up to 35,000 as the number of new county residents. The low cost of housing
(comparatively) and the ability to work remotely are contributing factors. The Bureau of Labor
Statistics of the U.S. Department of Labor reported an unadjusted unemployment rate of 9.2%
for the Flathead County statistical area in June of 2020. This is a 219% increase from the 4.2%
reported a year earlier (June 2019), however, the most recent available data (August 2020/6.3%)
shows a decrease of over 30% since the June 2020 data.
Request for Information
This financial report is designed to provide a general overview of the City of Kalispell's finances
for all those with an interest in the government's finances. Questions concerning any of the
information provided in this report or requests for additional financial information should be
addressed to the City of Kalispell, Finance Director, P.O. Box 1997, Kalispell, MT 59903-1997.
Wal
BASIC FINANCIAL STATEMENTS
GOVERNMENT - WIDE FINANCIAL
STATEMENTS
ASSETS
Cash and nits
Taxes and assessnxmis receivable
Accounts receivable - net
Notes and loans recemble
Contracts receivable
Due from other
Due from outer governments
Prepaids
Inventories
Properties held for sale
Other debits
Restricted assets:
Cash and investments
Capital assets (net of accumulated depreciation):
Land
Construction in Progress
Depreciable
Total assets
DEFERRED OUTFLOR'S OF RESOLRCES
OPEB diflerenoeslchanges
Cmtractuallyrequired contributions related to pensions
Total defected ouffiows of reswuces
Total assets and deferred outflows of resources
LIABDLEIIES
Due to plr bmeft providers
Accounts payable
Retainage
Deposits payable
Accruedpayroll
Ciurent portion of long-term liabilities
Bonds and notes - not capital
Bonds and notes - caprtal
C004masated absences payable
Other credits
Long-term liabilities, due m more than one year
Bonds and notes - not capital
Bonds and notes - capital
Ccmpensated absences
Net OPEB liability
Net pension liability
Total liabilities
DEFERRED ENFLOWS OF RESOURCES
OPEB dill rmces/changes
Difl behvcxn est. and actual earrings on pension plan inv
Total deferred inflows of resources
NET POSITION
Net investment in capital assets
Restricted by donirs for specific purposes
Restricted for capital projects
Restricted for debt service
Restricted for sperual projects
Restricted for other puposes
Unrestricted
Total net position
See armnTnm mgNotes to the Financial Statements
City of Hatispe% Montana
Statement of Net Position
dune 30, 2020
Component
tints
Governmemal
Business4Mm
Downtown
Tourism
Arttsities
Atinides
TOW
BID
BID
$ 18,200,369 $
20,411,075
S 38,611,444 S
61,077
S 348,276
2,547,176
72,536
2,619,762
4,233
301,029
427,676
729,705
2,493,181
-
2,493,181
346,629
509,798
856,427
10,390
1,063
11,453
2,694,446
481,928
3,166,374
14,552
288,350
44,501
332,851
-
105-003
105-003
799253
-
799253
12,692
2,746
15,438
2,068,685
10,58618M
12,655,525
3,743,166
354,021
4,097,187
1,798,074
14,968,095
16,766,169
73,392,713
83,612,6411
157,DO5,353
$ 108,686,153 $
131,578,872
S 240,265,025 S
79,862
S 348,276
748,746
108X4
857,670
2,190,525
423,60
2,614,193
$ 2,939271 $
532,592
$ 3,471,863 $
$
$ 111,625,424 S
132,111,464
$ 243,736,838 $
79,862
$ 348,276
$ 173,230
-
173,230
$ 505,796 $
6Dk245
S 1,114,041 $
4,&0
14,168
-
14,959
14,959
1,415,113
-
1,415,113
441,495
105,509
547,004
27,482
-
27,482
858,530
1,683270
2,541,800
1,120,147
213,388
1,333,535
-
13,120
13,120
434214
-
434214
6,944,926
22,072,390
29,017X6
452,583
121,500
574,083
2,910,6D5
423,421
3,334,026
9,265,548
2,360,845
11,626,393
$ 24,549,669 S
27,616,647
$ 52,166,316 S
4,b40
$ 14,168
1,393273
294687
1,595,960
$ 1,070,924 S
36OX2
S 1,431276 $
$
$ 2,464,197 S
563,039
S 3,027,236 $
$
$ 71,130,497 $
75,179,096
S 146,309,593 S
S
3,353,169
-
3,353,169
1,314,770
6,67IM7
7,996,087
1,189254
1,895,897
3,085,151
3,370,41
859,940
4,230,881
121,645
280,OOD
401,645
4,131,282
19,D45,528
23,176,810
75,222
334,108
$ 84,611,558 $
103,931,778
$ 188,543,336 S
75,222
S 334,108
27
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28
GOVERNMENTAL FUND
FINANCIAL STATEMENTS
MAJOR GOVERNMENTAL FUNDS
General Fund — The City's primary operating fund and accounts for the financial
operations of the City not accounted for in any other fund. Principal sources of revenue
are property taxes, state and local shared revenue, charges for services, and fines and
forfeitures. Principal expenditures are for public safety.
Street Maintenance — Accounts for special assessment revenues levied, received, and
expended to keep streets clean, safe, and drive -able.
City of Kalispell, Montana
Balance Sheet
Governmental Funds
June 30, 2020
Other
Total
General
Street
Governmental
Governmental
Fund
Maintenance
Funds
Funds
ASSETS
Cash and investments
$
4,404,781
$ 2,941,794
$ 10,493,812
$ 17,840,387
Taxes and assessments receivable
295,149
105,386
2,146,641
2,547,176
Accounts receivable - net
-
-
301,029
301,029
Notes and loans receivable
-
-
2,493,181
2,493,181
Contracts receivable
-
-
296,312
296,312
Due from other
-
-
10,390
10,390
Due from other finds
106,650
-
10,245
116,895
Due from other governments
1,714,303
253,438
716,705
2,684,446
Prepaids
240,412
13,133
27,804
281,349
Properties held for sale
-
-
799,253
799,253
Other debits
12,633
-
59
12,692
Restricted assets:
Cash and investments
$
-
$ -
$ 2,068,685
$ 2,068,685
Advances to other fluids
1,300,000
-
-
1,300,000
Total assets
$
8,073,928
$ 3,313,751
$ 19,364,116
$ 30,751,795
LIABILITIES
Due to ph benefit providers
$
173,230
$ -
$ -
$ 173,230
Accounts payable
128,172
81,473
214,562
424,207
Deposits payable
1,415,113
-
-
1,415,113
Accrued payroll
268,461
36,325
121,593
426,379
Due to other funds
-
-
116,895
116,895
Advances from other funds
-
-
1,300,000
1,300,000
Total liabilities
$
1,994,976
$ 117,798
$ 1,753,050
$ 3,855,824
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
$
-
$ -
$ 297,425
$ 297,425
Unavailable revenue - deferred taxes and assessments
295,149
105,386
2,146,641
2,547,176
Total deferred inflows of resources
$
295,149
$ 105,386
$ 2,444,066
$ 2,844,601
FUND BALANCES
Nonspendable - not in spendable form
Long -terra recievables
$
1,300,000
$ -
$ -
$ 1,300.000
Prepaids
240,412
13,133
27,804
281,349
Restricted
General Government
-
-
121,645
121,645
Public Safety
-
-
3,526,106
3,526,106
Public Works
-
3,077,434
1,794,378
4,861,812
Culture and Recreation
-
-
1,793,878
1,793,878
Community Development
-
-
6,724,110
6,724,110
Debt Service
-
1,189,254
1,189,254
Unrestricted Fund Balances:
-
Assigned
-
General Government
48,987
-
-
48,987
Capital Equipment
208,906
-
-
208,906
Parking
23,542
-
-
23,542
Miscellaneous
1,464,608
-
-
1,464,608
Unassigned fund balance
2,507,348
-
(175)
2,507,173
Total fund balances
$
5,793,803
$ 3,090,567
$ 15,167,000
$ 24,051,370
Total liabilities, deferred inflows of resources, and fund balances $
8,073,928
$ 3,313,751
$ 19,364,116
$ 30,751,795
See accompanying Notes to the Financial Statements
WE
City of Kalispell, Montana
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Position
June 30, 2020
Total fund balances - governmental funds $ 24,051,370
Capital assets used in governmental activities are not financial resources and, therefore, are not reported in
the funds. 78,720,111
An internal service fund is used by management to charge the costs of providing services within the
government. The assets and liabilities of the internal service funds are included in governmental activities
in the government -wide statement of net position 497,638
Deferred outflow of resources related to pensions.
- contributions made subsequent to the measurement date, recognized on the statement of net position 2,190,525
- DPEB differences and changes 748,746
Long-term liabilities are not due and payable in the current period and therefore are not reported as
liabilities in the funds.
- Bonds and notes
(8,265,152)
- Compensated absences
(1,535,931)
- Other post employment benefits
(2,910,605)
- Net pension liability
(9,265,548)
- Deferred inflow of resources - related to pensions
(1,070,924)
- Deferred inflow of resources - related to DPEB
(1,393,273)
Taxes, assessments and accounts receivable will be collected this year, but are not available soon enough to
pay for the current period's expenditures and, therefore, are reported as unavailable revenue in the fiuids.
- deferred taxes and assessments 2,547,176
- ambulance 297,425
Total net position - governmental activities $ 84,611,558
See accompanying Notes to the Financial Statements
30
City of Kalispell, Montana
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Fiscal Year Ended June 30, 2020
REVENUES
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Miscellaneous
Investment earnings
Total revenues
EXPENDITURES
General government
Public safety
Public works
Parks and recreation
Community development
Debt service - principal
Debt service - interest
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Issuance of debt
Proceeds from the sale of general capital asset disposition
Transfers in
Transfers out
Total other financing sources (uses)
Net Change in Fund Balance
Fund balances - beginning
Restatements
Fund balances - beginning, restated
Fund balance - ending
See accompanying Notes to the Financial Statements
Other
Total
Street
Governmental
Governmental
General Fund
_Maintenance
Funds
Funds
$ 6,510,495
$ 2,743,408
$
5,039,930 $
14,293,833
160,015
-
786,552
946,567
3,841,755
113,149
3,684,503
7,639,407
1,068,087
5,094
1,789,913
2,863,094
514,035
-
-
514,035
16,660
1,568
90,471
108,699
59,622
35,468
143,392
238,482
$ 12,170,669
$ 2,898,687
$
11,534,761 $
26,604,117
$ 3,392,161
$ -
$
- $
3,392,161
8,710,212
-
2,169,022
10,879,234
47,157
2,486,630
1,104,739
3,638,526
-
-
1,941,001
1,941,001
93,117
-
1,955,143
2,048,260
43,174
24,956
1,273,843
1,341,973
14,268
14,032
305,293
333,593
234,906
214,956
476,998
926,860
$ 12,534,995
$ 2,740,574
$
9,226,039 $
24,501,608
$ (364,326) $
158,113
$
2,308,722 $
2,102,509
$ -
$ -
$
15,824 $
15,824
-
6,500
-
6,500
925,000
-
80,000
1,005,000
-
-
(1,005,000)
(1,005,000)
$ 925,000
$ 6,500
$
(909,176) $
22,324
$ 560,674
$ 164,613
$
1,399,546 $
2,124,833
$ 5,188,442
$ 2,925,954
$
13,767,454 $
21,881,850
44,687
-
-
44,687
$ 5,233,129
$ 2,925,954
$
13,767,454 $
21,926,537
$ 5,793,803
$ 3,090,567
$
15,167,000 $
24,051,370
31
City- of Kalispell, Montana
Reconciliation of the Statement of Revenues, Expenditures.
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities
For the Fiscal Year Ended June 30, 2020
Amounts reported for governmental activities in the statement of
activities are different because:
Net change in fund balances - total governmental funds
Governmental funds report capital outlays as expenditures while governmental activities report depreciation
expense to allocate those expenditures over the life of the assets:
- Capital assets purchased
- Depreciation expense
Revenues in the Statement of Activities that do not provide current financial resources are not reported as
revenues in the funds:
- Donated capital assets
- Long-term receivables (deferred revenue)
The change in compensated absences is shown as an expense in the
Statement of Activities
Repayment of debt principal is an expenditures in the governmental funds, but the repayment reduces long-
term debt in the Statement of Net Position:
- Long-term debt principal payments
Long term debt proceeds provide current financial resources to the governmental funds, but issuing debt
increases long-term liabilities in the Statement of Net Position:
- Proceeds from the sale of long-term debt
Changes to net pension liability are shown as revenues/expenses on the Statement of Activities
The increase in other post employment benefits is shown as an expense in the
Statement of Activities
$ 2,124,833
926,860
(4,295,421)
26,555
(89,709)
(72,797)
1,341,973
(15,824)
(96,001)
(218,865)
Internal service funds are used by management to share the costs of certain activities, to individual funds.
The net revenue of the internal service funds is reported with the governmental activities of the Government.
Wide Statement of Activities (133,094)
Change in net position - Statement of Activities $ (9.461.538)
See accompanying Notes to the Financial Statements
M
PROPRIETARY FUND FINANCIAL
STATEMENTS
MAJOR ENTERPRISE FUNDS
Water Fund — Accounts for the City's water utility operations, including water impact
fees.
Sewer Fund — Accounts for the City's sewer and storm water utility operations, including
sewer and storm impact fees.
I1►N0a Iola ►►:11W11a:XV►[a)aILI)01M
Information Technology Fund — used to account for the goods and services provided by
the information technology department to other departments of the City on a cost -
reimbursement basis.
Central Garage Fund — used to account for the goods and services provided by the central
garage to other departments of the City on a cost -reimbursement basis.
City of Kalispell, Montana
Statement of Net Position
Proprietary Funds
June 30, 2020
Governmental
Business-T�Te
Acthities
- Enterprise Funds
Activities
Non -major
Internal
Water
Sewer
Enterprise
Totals
Service Funds
ASSETS
Current assets -
cash and investments
i
10,567,564
$
8,287,976 i
1,560,535
$
20.411,075 $
359,982
Taxes and assessments receivable
-
45,022
27,564
77,586
-
Accounts receivable - net
179,494
248,192
-
427,676
-
contracts receivable
106,503
403,295
509,798
50,317
Due from other
930
133
-
1,063
-
Due from other governments
112,042
268,646
101,240
481,928
-
Prepaids
16,061
21,054
7,386
44,501
7,001
Inventories
105,903
-
-
105,903
-
Other debits
-
7,746
7,746
-
Restricted assets:
Cash and investments
1,977,380
$609,460
-
10,586,840
-
Total current assets
$
13,060,877
$
17,883,768 $
1,699,471
$
32,644,116 $
417,300
Noncurrent assets:
Capital assets (net of accumulated depreciation):
Laud
i
105,958
$
248.063 $
-
$
354,021 $
-
Construction in Progress
103,620
14,864,475
-
14,968,095
-
Depreciable
34,274,588
48,976,277
361J75
93,617,640
213,942
Total noncurrent assets
$
34,484,166
$
64,088.815 $
361J75
$
98,934,756 $
213,942
Total assets
i
47,545,043
$
81,972,583 $
2,061,246
$
131,578,872 $
631,142
DEFERRED OUTFLOWS OF RESOURCES
OPEB differences/changes
i
66,898
$
42,026 $
-
$
108,924 $
-
Pension plan subsequent contributions/changes
123,068
232,336
68,264
423,668
-
Total deferred outflows of resources
$
189,966
$
274,362 $
68,264
$
532,592 $
-
LIABILTrtFS
Current liabilities -
Accounts payable
$
378,228
$
224.193 $
5,824
$
608,245 $
81,589
Retainage
4,609
10,350
-
14,959
-
Accrued payroll
28,642
59,597
17,270
105,509
15,115
Bonds and notes - capital
368,352
1,314.918
-
1,683,270
-
Compensated absences payable
65,434
104,410
43,544
213,388
17,974
Other credits
13,120
-
13,120
-
Total current liabilities
$
858,385
$
1,713,468 $
66,638
$
2,638,491 $
114,678
Noncurrent liabilities:
Bonds and notes - capital
$
4,505,433
$
17,566,957 $
-
$
22,077,390 $
-
Compensated absences
32,154
65,684
23,662
121,500
18,826
Net OPEB liability
260,054
163,367
-
423,421
-
Net pension liability
685,794
1,294,666
380,395
2,360,845
-
Total noncurrent liabilities
i
5,483,425
$
19,090,674 $
404,057
$
24,978,156 $
18,826
Total liabilities
i
6,341,810
$
20,804,142 $
470,695
$
27,616,647 $
133,504
DEFERRED INFLOWS OF RESOURCES
OPEB differences/changes
124,485
78,202
-
207,687
Pension-diff between projected and actual earnings $
104,676
$
197,614 $
58,062
$
360,352 $
Total deferred inflows of resources
i
229,161
$
275,816 $
58,062
$
563,039 $
-
NET POSITION
Net investment in capital assets
$
29,610,381
$
45,206,940 $
361,775
$
75,179,096 $
213,942
Restricted for capital projects
-
6,671,317
-
6,671,317
-
Restricted for debt service
524,854
1,371,043
1,895,897
Restricted for special projects
544,758
315,192
859,940
Restricted for other purposes
-
280.000
280,000
-
unrestricted
10,494,045
7,322.505
1,238,978
19,045,528
283,796
Total net position
$
41,164,038
$
61,166,987 $
1,600J53
$
103,931,778 $
497,638
See accompanying Notes to the Financial Statements
33
City of Kalispell, Montana
Statement of Revenues, Expenses, and Changes
in Net Position
Proprietary Funds
For the Fiscal Year Ended June
30, 2020
Governmental
Business-T-me Activities
- Enterprise Funds
Activities
Non -major
Internal
Water
Sewer
Enterprise
Totals
Service Fnnds
OPERATING REVENUES
Charges for services
$ 3,023,192 $
4,471,313
$
1,073,145
$
8,567,650
$ 1,187,315
Miscellaneous revenues
232,240
7,232
2,902
242,374
-
Special assessments
-
1,638,441
-
1,638,441
-
Total operating revenues
$ 3,255,432 $
6,116,986
$
1,076,047
$
10,448,465
$ 1,187,315
OPERATING EXPENSES
Personal services
$ 899,445 $
2,163,136
$
600,863
$
3,663,444
$ 471,505
Supplies
86,988
227,676
87,511
402,175
333,942
Purchased services
370,367
1,114,782
84,222
1,569,371
437,952
Building materials
400,751
135,345
-
536,096
-
Fixed charges
273,287
483,881
153,864
911,032
29,909
Depreciation
1,009,2.35
1,748,786
120,948
2,878,969
52,494
Total operating expenses
$ 3,040,073 $
5,873,606
$
1,047,408
$
9,961,087
$ 1,325,802
Operating income (lass)
$ 215,359 $
243,380
$
28,639
$
487,378
$ (138,487)
NON -OPERATING REVENUES (EXPENSES)
inch
$
15,147 $
31,686 $
8,402 $
55,235
$ -
Impact Fees
618,569
1,877,246
-
2,495,815
-
Interest revenue
167,679
225,967
19,289
412,935
5,393
Debt service interest expense
(94,039)
(467,931)
-
(561,970)
-
Total non -operating revenues (expenses)
$
707,356 $
1,666,968 $
27,691 $
2,402,015
$ 5,393
Income (loss) before contributions and transfer $
922,715 $
1,9102348 $
56,330 $
2,889,393
$ (133,094)
Contributions of infrastructure - developers, other
1,452,747
3,7472509
-
5,200,256
-
Change in net position
$
2,375,462 $
5,6572857 $
56,330 $
8,0892649
$ (133,094)
Net Position - Beginning of the year
$
38,788,576 $
55,5022312 $
1,544,423 $
95,8352311
$ 630,732
Restatements
-
6,818
-
62818
-
Net Position - Beginning of the year - Restated
$
38,788,576 $
55,5092130 $
1,544,423 $
95,8422129
$ 630,732
Net Position - End of the year
$
41,164,038 $
61,1662987 $
12600,753 $
103,9312778
$ 4972638
See accompanying Notes to the Financial Statements
City of Kalispell, Montana
Statement of Cash Flaws
Proprietary Funds
Year Ended June 30, 2020
Governmental
Business - Type Activities Activities
Internal Service
Nan -major
Water
Sewer
Enterprise
Totals
Fund
Cash flaws from operating activities:
Cash received from customers
$
3.058.629 $
$4,530,326 $
1,026,262
$ 8.615217
$ 1,187,498
Cash received from assessments
-
$1,574,887
-
1.574.887
-
Cash received from miscellaneous sources
232240
$7,231
2,902
242,373
Cash payments for claims
(1,091,439)
($2,057,420)
(330,886)
(3,479,745)
(783,948)
Cash payments to employees
(950.167)
($1,774,833)
(526,276)
(3251276)
(457,483)
Net cash provided (used) by operating activities
$
1249263 $
2,280,191 $
172,002
$ 3.701.456
$ (53,933)
Cash flaws from capital and related financing activities:
Principal paid on bands, loans and advances
$
(346.478) $
(1,680,566) $
-
(2,027,044)
$
Interest paid on bonds, loans and advances
(94.039)
(467,931)
-
(561.970)
Acquisition and construction of capital assets
(2,625,082)
(1,550,805)
(1,599)
(4,177,486)
(57,796)
Proceeds from bonds, loans and advances
2.401.869
403,362
-
2.805.231
Impact fees
643.879
2,022,220
2.666.099
Net cash provided (used) by capital and related financing activiteE S
(19.851) $
(1,273,720) $
(1,599)
$ (1,295,170)
$ (57,796)
Cash flaws from non -capital financing activities:
Hydrant meter deposits
$
752 $
- $
$ 752
$ -
Intergovernmental revenue
-
3,089
3,089
Net cash provided (used) from non -capital financing activitic.
S
752 $
3,089 $
$ 3,841
$ -
Cash flaws from investing activities:
Interest on investments
$
148279 $
$225,967 $
19,289
$ 393.535
$ 5,393
Net cash provided (used) by investing activities
$
148279 $
225,967 $
19,289
$ 393.535
$ 5,393
Net increase (decrease) in rash and rash equivalents
$
1,378.443 $
1,235,527 $
189,692
$ 2.803.662
$ (106,336)
Cash and cash equivalents at beginning
11,161,501
$15,661,909
1,370,943
28,194,253
466,318
Cash and cash equivalents at end
$
12,539,944 $
16,897,436 $
1,560,535
$ 30,997,915
$ 359,982
Reconciliation to Statement of Net Position:
Cash and investments
$
10.562.564 $
8,287,976 $
1,560,535
$ 20.411.075
$ 359,982
Restricted cash and investments
1,977,380
8,609,460
-
10.586.840
-
Total restricted and not restricted cash and investments
$
12.539.944 $
16,897,436 $
1,560,535
$ 30.997.915
$ 359,982
Reconciliation of operating income (lass) to net cash prodded
(used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net cash
provided (used) by operating activities:
Depreciation
Pension Adj.
Other Past Employment Benefits Expense
Changes in assets and liabilities:
Accounts receivable - ne1
Increase in Inventory
Taxes and assessments receivable, net
Prepaid expenses
Increase Comp Abs
Decrease in due from County
Accounts payable
Accrued payroll
Net cash provided (used) by operating activities
The City received non cash contributions
of land and infrastructure as follows:
See accompanying notes to the financial statPmentE
$ 215,359 $ 243,380 $
1.009.235 1,748,786
(71,993) 349,529
19,556 12,294
28,639 $ 487,378 $ (138,487)
120,948 2.878.969
65,996 343.532
- 31,840
52,494
35,437
59,012
94,449
183
(9249)
-
(9249)
-
-
(5,219)
(44,323)
(49.542)
-
12,842
19,266
6,421 -
38,529
1,073
(266)
19,998
7,031
26,763
11,949
-
(58,335)
(2,560)
(60.895)
-
36,361
(115,002)
(11,710)
(90,351)
16,782
1,981
6,492
1,560
10,033
2,173
$ 1,249,263 $
2,280,191 $
172,002 $
3,701,456 $
(53,933)
$ 1,452,747 $
3,747,509 $
- $
5.200.256 $
35
FIDUCIARY FUND FINANCIAL
STATEMENTS
CUSTODIAL FUNDS
Custodial Funds — used to account for assets held by the City as an agent for individuals,
private organizations, other governments, and/or other funds.
City of Kalispell, Montana
Statement of Fiduciary Net Position
Custodial Funds
June 30, 2020
ASSETS
Cash and investments
Total assets
LUBILITIE S
Due to others
Total liabilities
Custodial
Funds
13,294
13,294
13,294
13,294
See accompanying Notes to the Financial Statements
W
City of Kalispell, Montana
Statement of Changes in Fiduciary Net Assets
Custodial Funds
For the Fiscal Year Ended June 30, 2020
ADDITIONS
Evidence collected
Total additions
DEDUCTIONS
Evidence distributed
Total deductions
Change in net position
Net Position - Beginning of the year
Net Position - End of the year
Custodial Funds
$ 4,287
$ 4,287
$ 1,200
$ 1,200
$ 3,087
$ 10,207
$ 13,294
See accompanying Notes to the Financial Statements
37
NOTES TO THE FINANCIAL
STATEMENTS
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
I1214.0 DWRYII0 155 E1114196193 C1140 I al 16kW11 WICK6111C1101CCH 0111 M I V
The City of Kalispell's accompanying financial statements have been prepared in conformity with generally accepted
accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB), the accepted
standard -setting body for establishing governmental accounting and financial reporting principles.
The accompanying financial statements present the financial position of the City and the various funds and fund types, the
results of operations of the City and the various funds and fund types, and the cash flows of the proprietary funds. The
financial statements are presented as of June 30, 2020, and for the year then ended.
The more significant accounting policies of the City are described below.
Recently Implemented Accounting Pronouncements
For the fiscal year ended June 30, 2019, the City implemented GASB Statement 84, Fiducian, Activities. Statement 84
provides criteria for state and local governments to use to identify whether an activity is fiduciary and how fiduciary
activities are to be reported in the basic financial statements.
For the fiscal year ended June 30, 2020, the City implemented GASB Statement 88, Certain Disclosures Related to Debt
Including Direct Borrowings and Direct Placements. Statement No. 88 defines debt for purposes of disclosure in notes to
financial statements and establishes additional financial statement note disclosure requirements related to debt obligations of
governments, including direct borrowings and direct placements.
Financial Reporting Entity
In determining the financial reporting entity, the City complies with the provisions for GASB statement No. 14, The
Financial Reporting Entity; and includes all component units of which the City appointed a voting majority of the units'
board; the City is either able to impose its will on the unit or a financial benefit or burden relationship exists.
Primary Government
The City of Kalispell is a political subdivision of the State of Montana governed by an elected Mayor and Council duly
elected by the registered voters of the City. The City utilizes the City Manager form of government. The City is considered
a primary government because it is a general-purpose local government. Further, it meets the following criteria: (a) It has a
separately elected governing body (b) It is legally separate and (c) It is fiscally independent from the State and other local
governments.
The accompanying financial statements present the primary government and entities for which the government is considered
financially accountable (component units). These financial statements include all funds, agencies, boards, commissions and
authorities, which meet the criteria for inclusion in the City's financial report. These criteria include financial accountability,
appointment of a majority of the secondary government and the financial benefit or burden derived by the primary
government from a secondary government.
38
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Discretely Presented Component Units
Discretely presented component units are separate legal entities that meet the component unit criteria described above but do
not meet the criteria for blending. The City's discretely presented component units, the Downtown Business Improvement
District and the Tourism Business Improvement District are legally separate organizations of the City, but the City is
financially accountable. Neither the Business Improvement District nor the Tourism Business Improvement District issue
financial statements separate from the City of Kalispell. The City reports the two component units in separate columns to
emphasize that they are legally separate from the City and from each other.
Downtown Business Improvement District
On April 3, 2017, by resolution 5801, the City created the Downtown Business Improvement District (BID). The Mayor and
City Council appoint the Board of Directors. The City is able to impose its will on the BID as it is authorized to levy
assessments to support the activities of the BID, and approves their annual budget. The purpose of said Business
Improvement District is to promote the health, safety, prosperity, security and general welfare of the inhabitants of the City of
Kalispell and the proposed district, and appears to be of special benefit to the property within the District. The District
boundaries are roughly Yd Avenue East to P Avenue West between Center Street and P Street South. Publicly owned
property and owner occupied single family dwellings are exempt from the assessments related to the District.
Tourism Business Improvement District
On May 3, 2010, by resolution 5425, the City created the Tourism Business Improvement District (TBID). The Mayor with
the approval of the City Council appointed seven owners of property within the district to act as the Board of Trustees of the
District. The City is able to impose its will on the TBID as it is authorized to levy assessments to support the activities of the
TBID, and approves their annual budget. The purpose of said Tourism Business Improvement District is to promote the
health, safety, prosperity, security and general welfare of the inhabitants of the City of Kalispell and the proposed district,
and appears to be of special benefit to the property within the District. The District is made up of those properties within the
corporate limits of the City of Kalispell with five or more rooms providing overnight stays for transient patrons at its
business.
Basis of Presentation, Measurement Focus, and Basis of Accounting
Government -wide Financial Statements
The government -wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report
information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the
effect of interfimd activity has been removed from these government -wide financial statements. Governmental activities,
which normally are 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 primary government is reported separately
from certain legally separate component units for which the primary government is financially accountable.
Eliminations have been made to minimize the double counting of business -type activities.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by
program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. The general
government function of the City includes expenses that are, in essence, indirect expenses of other functions. These indirect
expenses are allocated to each related function. 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 as general revenues.
39
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Indirect expenses reported in the statement of activities are allocated to the different functions of the City. These indirect
expenses include administration, data processing, and central garage. The administrative cost allocation is based on each
functions' percentage of total City expenses. Data processing is allocated based approximately on that functions usage of the
City's computer servers. Central garage expenses are allocated to the other functions of the City based on actual invoicing.
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
individual enterprise funds are reported as separate columns in the fiend financial statements.
Certain eliminations have been made as prescribed by GASB 34 in regards to inter -fund activities, payables and receivables.
All internal balances in the Statement of Net Position have been eliminated except those representing balances between the
governmental activities and business -type activities, which are presented as internal balances and eliminated in the total
primary government column. In the Statement of Activities, internal service fund financial statements have been eliminated;
however, interfimd services provided and used are not eliminated in the process of consolidation. Interfund services provided
and used are not eliminated in the process of consolidation.
Measurement Focus and Basis ofAccounting
On the government -wide Statement of Net Position and the Statement of Activities, both governmental and business -type
activities are presented using the economic resources measurement focus and the accrual basis of accounting. Under the
accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred,
regardless of the timing of the 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. The City generally applies restricted resources to expenses incurred before using unrestricted resources when both
restricted and unrestricted net assets are available.
The City has chosen not to accrue the interest payable of general long-term debt at year-end. This practice results in interest
expense reported for governmental activities on the statement of activities to equal the interest expenditure on the statement
of revenues, expenditures, and changes in fund balance. Although, this is contrary to full accrual accounting, the City feels
that it is immaterial in the presentation of its financial statements.
Fund Financial Statements
Basis of Presentation
The financial records of the City are organized into foods. A fund is an independent fiscal and accounting entity with a self -
balancing set of accounts. Fund accounting segregates fimds according to their intended purpose and is used to aid
management in demonstrating compliance with finance -related legal and contractual provisions. The minimum number of
fimds is maintained consistent with legal and managerial requirements. Funds are organized into three categories:
governmental, proprietary, and fiduciary. An emphasis is placed on major foods within the governmental and proprietary
categories. Each major fund is displayed in a separate column in the governmental or proprietary funds statements. All of
the remaining funds are aggregated and reported in a single column as non -major fimds. A fund is considered major if it is
the primary operating fund of the City (General fund) or meets the following criteria:
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or enterprise fund
are at least 10 percent of the corresponding total for all funds of that category or type; and
b. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or enterprise foods
are at least 5 percent of the corresponding total for all governmental and enterprise funds combined.
40
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Measurementfocus and Basis ofAccounting
Governmental funds are used to account for the City's general government activities. Governmental fiend types use the
flow of current financial resources measurement focus and the modified accrual basis of accounting. Under the modified
accrual basis of accounting, revenues are recognized when susceptible to accrual, (i.e., when they are "measurable and
available"). "Measurable" means the amount of the transaction can be determined and "available" means collectible within
the current period or soon enough thereafter to pay liabilities of the current period. The City considers all revenues available
if they are collected within 60 days after year-end. Expenditures are recorded when the related finnd liability is incurred
except for un-matured interest on general long-term debt which is recognized when due, and certain compensated absences
and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable
available financial resources.
Real and personal property taxes, special assessments, charges for current services, and interest earnings are susceptible to
accrual. Other receipts and taxes become measurable and available when cash is received by the City and are recognized as
revenue at that time. The City recorded real and personal property taxes and assessments levied for the current year as
revenue. Taxes and assessments receivable remaining unpaid at year-end and not expected to be collected soon enough
thereafter to be available to pay obligations of the current year were recorded as deferred revenue, with a corresponding
reduction in revenues, as required by generally accepted accounting principles. In addition, prior period delinquent taxes and
assessments collected in the current period were recorded as revenue in the current period as required by generally accepted
accounting principles. Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to
accrual criteria are met. Expenditure driven grants are recognized as revenue when the qualifying expenditures have been
incurred and all other grant requirements have been met.
Major Funds
The City reports the following major governmental funds:
The General Fund is always a major finnd. This is the City's primary operating fund and it accounts for all financial
resources of the City except those required to be accounted for in other fiords.
The Street Maintenance Fund (special revenue fiend) was established to account for the repairs and other costs incurred in
the maintenance of the City's streets. An assessment on the City of Kalispell's tax payers is the main source of revenue for
this fund.
Proprietary funds are accounted for using the accrual basis of accounting. These finnds account for operations that are
primarily financed by user charges. The flow of economic resources focus concerns determining costs as a means of
maintaining the capital investment and management control. Revenues are recognized when earned and expenses are
recognized when incurred. Allocations of costs, such as depreciation, are recorded in proprietary funds.
Proprietary fiords distinguish operating revenues and expenses from non -operating items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connections with a proprietary fund's
principal ongoing operations. The principal operating revenues for enterprise funds are charges to customers for sales and
services. Operating expenses for enterprise fiords include the cost of sales and services, administrative expenses, and
depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non -operating revenues
and expenses. When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted
resources first, then unrestricted resources as they are needed.
41
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
The City reports the following major proprietary funds:
The Water Fund accounts for the activities of the City's water distribution operations
The Sewer Fund accounts for the activities of the City's sewer collection and treatment operations and includes the storm
sewer system.
Additionally, the City reports the following fund types:
Internal Service. These funds account for the financing of goods and services provided by one department to other
departments on a cost reimbursement basis. These funds account for the City's fleet repair and maintenance (Central Garage)
and provide technology systems and a means to distribute public information (Information Technology) to City Staff for their
respective provisions of services to the City of Kalispell.
All Fiduciary funds reported account for assets held by the City of Kalispell in a trustee capacity (custodial fund). The
custodial fund does not present results of operations or have a measurement focus. Agency fiinds are accounted for using
the accrual basis of accounting.
The Kalispell Police Department (IUD) Evidence custodial fund accounts for assets that the City holds as evidence, but
will be returned to the owner when it is no longer required as evidence.
Eliminations have been made to minimize the double accounting of internal activities. The City's policy for internal service
elimination is to eliminate amounts related to overhead and indirect expenditures and not services provided. Assets of the
internal service funds are allocated to the governmental -type funds and the business -type funds based on which fund type
benefits the most from its services. Accordingly, the Information Technology and Central Garage funds' assets are included
with the governmental activities.
Assets, Liabilities, and Net Assets oi• Equity
L Cash and Investments
Cash and investments are under the management of the City's Treasurer and consist primarily of demand deposits and
investments in U.S. Government Bonds. Interest income earned as a result of pooling of City deposits is distributed to the
appropriate funds utilizing a formula based on the average balance of cash and investments of each fund.
Montana State statutes authorize the City to invest in interest -bearing savings accounts, certificates of deposits, and time
deposits insured up to $250,000 by the Federal Deposit Insurance Corporation or fully collateralized, U.S. government and
U.S. agency obligations and repurchase agreements where there is a muster repurchase agreement and collateral held by a
third party.
Investments are carried at cost, which approximates fair value as described in Note 3, A, except for investments in State of
Montana Short Term Investment Pool (STEP) which is reported at fair value.
For purposes of the statement of cash flows, the enterprise and internal services funds consider all funds (including restricted
assets) held in the City's cash management pool to be cash equivalents.
42
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
2. Receivables
Rvhnvvn Fund z
Transactions between funds that are representative of lendingiborrowing arrangements outstanding at the end of the fiscal
year are referred to as either interf ind receivableslpayables (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.
Advances between funds are offset by a fund balance reserve account in applicable governmental funds to indicate they are
not available for appropriation and are not expendable available financial resources.
Taxes
Property tax levies are set within forty-five days of the State providing shared revenue figures, in connection with the budget
process. Real property (and certain attached personal property) taxes are billed within ten days after the third Monday in
October and are due in equal installments on November 30 and the following May 31. After those dates, they become
delinquent, and a lien is filed upon the property. After three years, the City may exercise the lien and take title to the
property. Special assessments are billed in two equal installments due November 30 and the following May 31. Personal
property taxes (other than those billed with real estate) are generally billed no later than the second Monday in July (normally
in May or June), based on the prior November's levies. Personal property taxes, other than mobile homes, are due thirty days
after billing. Mobile home taxes are billed in two halves, the first due thirty days after billing; the second due September 30.
The tax billings are considered past due after the respective due dates and are subject to penalty and interest charges.
An allowance for uncollectible accounts was not maintained for real and personal property taxes and special assessments
receivable. The direct write-off method is used for these accounts.
Ambulance
An allowance, based on history, for estimated uncollectible accounts receivable of 55% is maintained for the Ambulance
fund. This allowance account has been adjusted to $367,924 at June 30, 2020.
Ambulance accounts receivable $668,953
Times allowance percentage 55%
rr June 30, 2020 $367,924
WaterlSewer
A reserve for estimated uncollectible accounts receivable of 0.5% of metered sales is maintained for the Water Fund and
Sewer Fund. The reserve balances are as follows for June 30, 2020:
Water $ 15,170
Sewer $ 22,420
43
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Confracfs
The following are contracts payable to the City of Kalispell on June 30, 2020.
FUND
Source
Amount
CD Misc.
Property Sale
$
296,312
Information Technology - Intemal
Service Franchise Fees -Charter (formerly Bresnan)
$
50,317
Total Governmental Activities
$
346,629
Water - Major Proprietary
Impact Fees
$
106,503
Sewer - Major Proprietary
Impact Fees
$
403,295
Total Proprietary Funds
$
509,798
Total City contracts receivable
$
856,427
3. Inventories and Prepaid Items
Inventories for materials and supplies for governmental fiord types are expended at the time of purchase. The amounts on
hand in governmental funds are considered immaterial. Enterprise Fund inventory of materials and supplies are valued at
cost and the First -In First -Out (FIFO) method is utilized.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both
government -wide and fiend financial statements. Prepaid items arise when charges are entered in the accounts for benefits not
yet received. In subsequent periods, when the benefit criteria are met, or when the City has a legal claim to the resources, the
prepaid items are removed from the balance sheet and expenses are recognized.
On June 30, 2020, the City reported prepaid expenses in the following funds.
FUND
Purpose
Amount
FUND
Purpose
Amount
General - Major Governmental
Workers Compensation
$ 119.430
General - Major Governmental
Health Insurance
120.982
Water
- Major Proprietary
Health Insurance
16,061
Parks
Health Insurance
11.691
Water
- Major Proprietary
Prepaid rent
Ambulance
Health Insurance
11.310
Sewer-
Major Proprietary
Health Insurance
21,054
Building Department
Health Insurance
4.803
Sewer
- Major Proprietary
Prepaid rent
Street Maintenance
Health Insurance
13.133
Solid Waste
Health Insurance
7,386
Street Maintenance
Prepaid rent
Solid Waste
Prepaid rent
CD Misc.
Prepaid rent
Total Proprietary Funds
44,501
Total Governmental Funds
281,349
Total City prepaids
$ 332,851
Information Technology - Intemal Service
Health Insurance
2,224
Information Technology- Intemal Service
Prepaid maintenance contracts
1,590
Central Garage - Internal Service
Health Insurance
3,187
Total Internal Service
7,001
Total Governmental Activities
288,350
The City pays quarterly in advance for Health Insurance and Workers' Compensation insurance. Some information
technology maintenance contracts span up to three years.
4. Restricted Assets
Certain proceeds of the City's enterprise fund revenue bonds, as well as certain resources set aside for their repayment, are
classified as restricted assets on the balance sheet because their use is limited by applicable bond covenants. When an
expense is incurred for which both restricted and unrestricted net assets are available, it is the City's policy to first apply the
restricted resources.
44
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
5. Capital Assets
Capital assets, which include property, plant, and equipment, are reported in the applicable governmental or business -type
activities columns in the government -wide financial statements. The City defines capital assets as assets with an initial,
individual cost of more than $5,000 and an estimated useful life in excess of five years. Such assets are recorded at historical
cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value. As
required by GASB, the City of Kalispell has retroactively reported its streets as part of capital assets in the financial reports
for fiscal year 2009. More detailed information on the City's streets and all capital assets can be found in Note 3, D. Capital
Assets.
Police vehicles are an exception despite a useful life less than 5 years. The City has determined that it is important to
capitalize and depreciate these because the total cost, as a group, is substantial.
The costs of normal maintenance and repairs that do not add to the value of the assets or extend asset lives are not capitalized.
Improvements are capitalized and depreciated over the remaining useful lives of the related assets. Major outlays for capital
assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of fixed
assets is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the
same period.
Depreciation has been provided for the property, plant and equipment of the City of Kalispell using the straight-line method.
The useful lives of these assets have been estimated as follows:
Buildings
20-50 years
Improvements Other than buildings
10-50 years
Streets
40 years
Machinery, vehicles and equipment
3-20 years
Water and Sewer lines, pump stations
10-50 years
6. Compensated Absences
It is the City's policy and state law to permit employees to accumulate a limited amount of earned but unused vacation
benefits, which will be paid to employees upon separation from City service. Employees are allowed to accumulate and carry
over a maximum of two times their annual accumulation of vacation. Any vacation leave time accumulated over this
maximum carryover must be used within 90 days of the new calendar year. There is no restriction on the amount of sick
leave that may be accumulated. Upon separation, employees are paid 100 percent of accumulated vacation and 25 percent of
accumulated sick leave.
In fiscal year 2012, the City of Kalispell began offering a voluntary employees beneficiary association (VEBA) plan. A tax-
free post -retirement medical expense account used by retirees and their eligible dependents to pay for any eligible medical
expenses. The plan is funded by 50% of the employee's unused sick leave at the time of retirement, which is contributed by
the City into the plan. The benefit to the retiree of this plan is that they receive two times the amount of unused sick leave at
retirement, none of which is subject to tax.
The liability associated with governmental fimd-type employees is reported in Governmental Activities column of the
Statement of Net Position, while the liability associated with proprietary fund -type employees is recorded in the respective
fimd and the Business -type Activities column of the Statement of Net Position. For the purpose of reporting these
compensated absences payable as current or noncurrent, the City assumes all employees will use their vacation accumulated
as of June 30 in the succeeding fiscal year (current). The City also assumes sick leave accumulated as of June 30 will remain
accumulated in the succeeding fiscal year (long-term).
45
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Long - Tei•in Obligations
In the government -Aide 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, or proprietary fund type
statement of net position. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs
are expensed when incurred.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond 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. Net Position/Fund Balance
Net position in the government wide and proprietary fund financial statements show the amount of the capital assets less any
outstanding debt issued to fund them as "net investment in capital assets." Restricted net position are those that have
constraints placed on them by external parties, or imposed by law or enabling legislation.
The City implemented GASB Statement 54 for fiscal year 2011. As a result, the classifications for fund balance now used
for governmental funds are reported in two general classifications, non -spendable and spendable:
Non -spendable represents the portion of fund balance that is not in spendable form such as inventories and prepaids, and, in
the general fund, long-term notes and loans receivable.
Spendable fund balance is further categorized as restricted, committed, assigned, and unassigned.
Restricted fund balance contains balances that can be spent only for the specific purposes stipulated by external parties or
through enabling legislation. External parties include grantors, debt covenants, votes, and laws and regulations of other
governments.
Committed fund balance includes amounts that can be used only for the specific purposes determined by a formal action
of the government's highest level of decision -making authority, the City Council. The City Council formally adopts a
Resolution in order to establish, modify, or rescind a fund balance commitment.
Assigned fund balances are intended to be used by the government for specific purposes but do not meet the criteria to be
classified as restricted or committed. Fund balances are assigned by the governing body. The City Council has the
authority to express assignments in the General fund. In governmental funds other than the general fund, assigned fund
balance represents the remaining amount that is not restricted or committed. Also included in the assigned fund balance
for the general fiord are assignments for the portion of the current general fund balance projected to be used to fund
expenditures and other cash outflows in excess of the expected revenues and other cash inflows in the next fiscal year.
Unassigned fund balance is the residual classification for the government's general fund and includes all spendable
amounts not contained in the other classifications. In other fiords, the unassigned classification is used only to report a
deficit balance resulting from overspending for specific purposes for which amounts have been restricted, committed, or
assigned.
Mal
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
When both restricted and unrestricted resources are available, spending will occur in the following order, for the identified
fimd types:
General Fund: restricted, committed, assigned, unassigned
Special Revenue Funds: restricted, committed, assigned
Debt Service Funds: assigned, committed, restricted
Capital Project Funds: restricted, committed, assigned
NOTE 2. STEWARDSHIP, COMPLLANCE AND ACCOUNTABILITY
Budgetary Data
Policies
The State of Montana's budget law stipulates that money, other than payments from Agency fimds, may not be drawn from
the treasury of a municipality except pursuant to an appropriation. The City legally adopts a budget for the required funds.
Process
An annual appropriated operating budget is adopted each fiscal year for the general fluid, special revenue fimds, debt service
fimds and capital projects funds on the modified accrual basis. In addition, a budget is adopted for the enterprise and internal
service fimds on a full accrual basis. The appropriated budget is prepared by fund, fiinction, and for the general fiord and
certain other fimds, by department.
The final budget is legally enacted by the City Council, after holding public hearings as required by State statutes, and within
forty-five days of the State providing final shared revenue figures. The City Manager and Finance Director may make budget
appropriation transfers within a fund between general classifications of salaries and wages, maintenance and operation and
capital outlay. Reported budget amounts represent the originally adopted budget as amended by resolution of the City
Council. It is management's responsibility to see that the budget is followed to the budgetary line item.
The City Council may amend a final budget when shortfalls in budgeted revenues require reductions in approved
appropriations to avert deficit spending; when savings result from unanticipated adjustments in projected expenditures; when
unanticipated state or federal monies are received; or when a public emergency occurs which could not have been foreseen at
the time of adoption.
The City Manager is granted budget amendment authority for the expenditure of fimds from debt service funds, enterprise
fimds, internal service fiords, trust fimds, federal and state grants accepted and approved by the City Council, special
assessments, and donations.
The procedure to amend the budget in total can be made only after the City prepares a resolution, notice is published of a
public hearing, and a public hearing is held in accordance with state law.
The City had no violations of budget law for fiscal year 2020, as all expenditures/expenses in total by fimd are less than the
related appropriations, or are transfers of closed fiends as allowed by State law. All budget amendments and closeout
transfers during FY 2020 are described below:
The Police Grants special revenue fund (2919) budget was increased $10,279 for an unanticipated grant award.
47
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
The CD Programs special revenue fund (2886) budget was increased $31,958 for the unanticipated cost of a property
sale at the Old School Station Industrial/Technological Park.
The SID Revolving debt service fund was amended by $50,000 to accommodate the transfer of reserve funds to the SID 344
debt service fund.
The Bridge and Road Safety and Accountability Act fund appropriation budget was increased $202,386. The fiscal year
2020 budget should have included a carryover from fiscal year 2019 for this amount.
The 2011 S & C debt service fund was amended by $35 and the 3188 Westside TIF debt service fund was increased by $400.
The debt payments on these funds were incorrectly calculated for budgeting purposes.
A. Cash and Investments
At June 30, 2020, the carrying amount of the City's deposits in local banks and investments is $51,341,341. Interest bearing
account balances are covered by the Federal Depository Insurance Corporation (FDIC) up to $250,000 per bank, per
depositor. In addition, all noninterest bearing transaction account balances are fully insured by FDIC coverage. The
remaining balances are covered by collateral held by the pledging bank's agent in the City's name.
The City's reports cash and investments as follows
Unrestricted
Restricted
Total
Governmental activities $18,20D,369
$2,068,685
$20,269,054
Business -type activities 20,411,075
10,586,840
30,997,915
Fiduciary funds 13,294
13,294
Component units 61,077
61,077
$38,685,815
$12,655,525
$51,341,341
Reconciliation of carrying amount to deposit balances:
Govemmental
& Business
Investment Activities Agency BID Total
Certificates of Deposit $248,000 $ 248,000
24%000 $ 249,000
U.S. Government Bonds 14,376,OD0
$ 14,376,000
State of Montana -
Short Term Investment Pool Account 32,595,914 $ 32,595,914
S & C Bonds - internal 43,055 $ 43,855
Demand deposits 3,751,421 $13,294 $61,077 $ 3,825,792
Petty Cash 2,780 $ 2,780
$ 51,266,969 $ 13,294 $ 61,077 $ 51,341,341
Interest rate risk exists when there is a possibility that changes in interest rates could adversely affect an investment's fair
Value.
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Credit risk is the risk that an issuer or other counterpart to an investment will not fulfill its obligation. The above credit risk rating
indicates the probability that the issuer may default in making timely principal and interest payments. Standard and Poor's
Corporation (S&P) provide the credit ratings presented in the previous tables. The City's investment policy is to hold investments
to maturity with the contractual understanding that these investments are low risk, locked in to a guaranteed rate of return, and
are, therefore, not impacted significantly by changes in short term interest rates. The City has no formal policy relating to interest
risk and no formal policy relating to credit risk.
The City voluntarily participates in the STIP (Short Term Investment Pool) administered by the Montana Board of Investments
(MBOI). Shares, the prices of which are fixed at $1.00 per share, represent a local government's STIP ownership and participants
may buy or sell shares with one -business days' notice. STIP administrative expenses are charged daily against the STIP income,
which is distributed on the first calendar day of each month. Shareholders have the option to automatically reinvest their
distribution income in additional shares. STIP is not registered with the Securities and Exchange Commission. STIP is not FDIC
insured or otherwise insured or guaranteed by the federal government, the State of Montana, the MBOI or any other entity against
investment losses and there is no guaranteed rate of return on funds invested in STIP shares. The MBOI maintains a reserve fund
to offset possible losses and limit fluctuations in STIP's valuation. The STIP investment portfolio consists of securities with
maximum maturity of 2 years. Information on investments held in the STIP can be found m the Annual Report on the MBOI
website at http:llinvestment.com/AnnuaLReportsAudits.
Investments in the pool are reported at a Net Asset Value (NAV). The fair value of pooled investments is determined annually
and is based on year-end market prices. The unit value of the pool is fixed at $1 for both participant redemptions and purchases.
Investments in STIP are carried and reported at cost. STIP income is automatically reinvested in additional units. The STIP is
not rated by a national rating agency.
Along with limitations placed on investments by state law, the City minimises custodial credit risk by restrictions set forth in City
policy. Custodial credit risk for investments is the risk that in the event of a financial institution failure, the City's investments
may not be returned, or the City will not be able to recover the collateral securities in the possession of the outside party.
B. Interfund Receivables and Payables (Due to/from Other Funds)
The composition of interfund balances and due to/from as of June 30, 2020, was as follows:
Receivable Fund Payable Fund Amount Purpose
General Fund - Major Governmental Stonegarden Grant - Special Revenue 4,667 SIT Loan
General Fund - Major Governmental Ambulance - Special Revenue 101,983 SJT Loan
SID Revolving - Debt Service S & Cs - Debt Service 329 S/T Loan
Brownsfield Rev. Loan - Special Revenue Brownsfield Grant - Special Revenue 9,916 SIT Loan
Total - Due To f]ther Funds {Governmental Funds} 116,895
C. Transfers
The following is an analysis of transfers between funds during Fiscal Year 2020:
From To Amount Purpose
Health General - Major Governmental 925,000 Operations
SID Revolving SID 344 80,000 Operations
TOTAL $ 1�000
.M
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
D. Capital Assets
Capital asset activity for the year ended June 30, 2020 was as follows:
Assets Contributed
In fiscal year 2020, Governmental Activities report contributed assets with a value of $26,554. These contributed assets were
sidewalks replaced or repaired and paid for by homeowner's directly or thru Sidewalk & Curb assessments.
In fiscal year 2020, Business -type Activities report contributed assets with a value of $5,067,615.
Developers contributed thirteen thousand nine hundred twenty linear feet (13,920') of water mains valued at $1,320,107 to
the water fund. This 13,920 linear feet of mains was distributed among nine different projects (developments).
The Sewer fiend received sewer and storm mains, and two (2) sewer lift stations. Developer's contributed six thousand nine
hundred fifty-nine linear feet (6,959') of storm sewer mains ($601,135), eleven thousand seven hundred sixty-five linear feet
(11,765') of sewer main ($2,895,846), and two lift stations ($250,528). This 18,724 linear feet of mains, and the two lift
stations were distributed among eight different projects (developments).
Gran (Loss) on SalelDlsposal of Capital Assets
In fiscal year 2020, Governmental Activities report a gain on disposal of assets of $6,500. The Street Department sold a fully
depreciated asset (plow) to another municipality, resulting in both a gain on disposal of assets in the government -wide
financials and a proceed from the sale of capital asset in the fund financial statements.
Construction In Progress
Additions to construction in progress of govermnental activities include an additional $291,186 for the ongoing core trail
project.
Reductions to construction in progress of governmental activities included $8,960,047 related to the Glacier Rail Park, and
either; ($6,028,175) donated to Flathead County Economic Development Authority (FCEDA), or ($2,931,872) converted to
an expenditure. $53,429 was moved from construction in progress to capital assets.
Additions to construction in progress of business -type activities was $546,191. This included replacement of water mains
($103,620), continued construction of the westside interceptor ($278,627), and continued regional stormwater facilities
design and construction ($163,944).
Reductions to construction in progress of business -type activities included, in the water fund, the 1st Avenue West North
water main project ($409,787), the Conrad Drive water main project ($100,371), the 4 Mile Dr. transmission main ($38,052),
the Section 36 Well ($1,413,292), and the shop pavement project ($33,622). Reductions to construction in progress in the
sewer (storm) fund included, the secondary digester lid replacement ($1,247,531), the shop pavement project ($33,527 from
sewer, $165,192 from storm), the TWAS roof replacement ($28,588), and Sylvan Dr. storm water repairs ($22,353).
50
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Assets Contributed to other Governmental Entities
The City of Kalispell was awarded a $10 million Transportation Income Generating Economic Recovery (TIGER) grant from
the U.S. Department of Transportation. The emphasis of this grant was to remove the railroad tracks from the City's core to
assist further development without the tracks being an impediment, and to develop a rail park outside of the core to
accommodate businesses that need or prefer rail service for their business.
In fiscal year 2020 with the rail park substantially completed, rail park assets including land and infrastructure, with a cost
basis of $6,028,175, were donated to Flathead County Economic Development Authority (FCEDA). FCEDA is a corporate
public body organized for the stated purpose of stimulating commerce, maximizing employment opportunities and expanding
the tax base. FCEDA, as the landowner, will manage the rail park and the tenants.
Balance
Balance
Governmental Activities:
Jury 1, 2019
Additions
Contributions
Transfers Deductions
June 30, 2020
Capital assets not being depreciated:
Land (Asset type: ❑10)
$ 3,743.166
$ -
$ -
$ - $
$ 3,743,166
Construction in Progress
10,520.364
291,186
(8,960,047)
(53.429)
1,798,074
Total capital assets not being depreciated
14263.530
291,186
(8,960,047)
(53.429)
5,541,240
Capital assets being depreciated:
Buildings (Asset type: 020)
17,397.261
-
- (698,247)
16,699,014
Improvements other than buildings (Asset type: 030)
18,195.679
162,120
26,554
33.522 (115,370)
18.302,505
Machinery and equipment
General (Asset type: 040)
9,929.062
473,555
19.907 (99,934)
10,322,590
Ambulance (Asset type: 100)
479.656
-
-
479,656
Parking (Asset type: 230)
55.836
-
(9,765)
46,071
Infrastructure (Asset type: 031 )
93205,419
-
93,205,419
Total capital assets being depreciated
139-62,913
635,675
26,554
53.429 (923,316)
139,055,255
Less accumulated depredation tor:
Buildings (Asset type: 020)
(10,261.565)
(580,614)
-
- 698,247
(10,143,932)
Improvements other than buildings (Asset type: 030)
(11,197.497)
(638,434)
115,370
(11,720,561)
Machinery and equipment
General (Asset type: 040)
(5,663.434)
(701,369)
99,934
(6,264,869)
Ambulance (Asset type: 100)
(342.257)
(41.442)
-
(383,699)
Parking (Asset type: 230)
(53.754)
(t,470]
9,765
(45,459)
Infrastructure (Asset type: 031)
(34,985,772)
(2,332,092)
-
(37,317,864)
Total accumulated depreciation
(62,504,279)
(4,295,421)
- 923,316
(65,876,384)
Total capital assets being depreciated, net
76,758.634
(3,659,746)
26,554
53.429 -
73,178,871
Governmental activities capital assets, net
$ 91,022.164
$ (3,368,560)
$ (8,933,493)
$ - $ -
$ 78,720,111
Balance
Balance
Internal service funds:
July 1, 2019
Additions
Contributions
Transfers Deductions
June 30, 2020
Information Technology (Asset type: 200)
$ 413.478
$ 57,796
$
$ $ (2,672)
$ 468,6(12
Less accumulated depredation - Information Technok)gy
(301.083)
(41,064)
2,672
(339,475)
Central Garage (Asset type: 220)
303.442
-
303,442
Less accumulated depredation -Central Garage
15
Internal service funds assets, met
%7 5461
301
213.a42
Governmental activities depreciation was charged to fnnctionslprograms of the primary government as follows
Govemmental Activities:
General Government
$ 2,595,524
Public Safety
519,641
Public Works
742,457
Parks and Recreation
437,799
Total Govemmental Activities
$ 4,295,421
51
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Balance
Transfersl
Construction
Balance
Business -type activities:
Jury 1, 2019
Additions
Contributions
in Progress
Deductions
June 30, 2020
Capital assets not being depreciated:
Land
Water (Asset type: 070)
105,958
-
105,958
Sewer (Asset type: 120)
221,513
-
221,513
Sewer (Storm) (Asset type: 150)
26,550
-
-
26,550
Construction in progress
Water
1,995,124
103,620
-
(1,995,124)
103,620
Sewer
15,442,738
278,627
-
(1,309,646)
14,411,719
Storm
476,357
163,944
-
(187,545)
452,756
Solid Waste
33,527
-
-
(33,527)
-
Total capital assets not being depreciated
18,301,767
546,191
-
(3,525,842)
15,322,116
Capital assets being depreciated:
Water
General Plant (Asset type: 060)
1,196,626
37,846
33,622
(129,926)
1,138,168
Source of Supply (Asset type: 070)
4,792,054
25,299
1,408,555
(59,087)
6,166,821
Transmision and Distribution (Asset type:
080)
34,926,793
2,240,764
1.320.107
552,947
(826,026)
38,214,585
Pumping Plant (Asset type: 090)
4,122,686
-
-
(141,642)
3,981,044
Sewer
General Plant (Asset type: 130)
1,125r227
12,232
33,527
(126,203)
1,044,783
Transmision and Distribution (Asset type:
140)
28,394,665
-
3.146.374
-
(8,055)
31,532,%4
Storm Sewer System (Asset type: 150)
16,913,063
13%518
601,135
187,545
(97,851)
17,743,410
Treatment Plant Equipment (Asset type:
180)
480,811
-
(3,175)
477,636
Treatment Plant (Asset type: 190)
40,325,567
67%408
1,276,119
(31,550)
42,24%544
Solid Waste
Buildings (Asset type: 111)
316,731
1,599
-
33,527
(6,415)
345,442
Machinery and equipment (Asset type: 110)
1,597,994
-
-
-
(1,648)
1,596,346
Total capital assets being depreciated
134,192,217
3,136,666
5,067,616
3,525,842
(1,431,578]
144,490,763
Less accumulated depreciation for:
Water
General Plant (Asset type: 060)
(999,2U)
(31,580)
129,926
(900,936)
Source of Supply (Asset type: 070)
(1,433,976)
(10%450)
59,087
(1,484,339)
Transmision and Distribution (Asset type:
080)
(10,846,978)
(787,374)
826,026
(10,808,326)
Pumping Plant (Asset type: 090)
(2,093,240)
(80,830)
141,642
(2,032,428)
Sewer
General Plant (Asset type: 130)
(903r294)
(23,456)
126,203
(800,547)
Transmision and Distribution (Asset type:
140)
(12,528,493)
(483,157)
-
8,055
(13,003,595)
Storm Sewer System (Asset type: 150)
(5,764,162)
(396,025)
-
97,851
(6,062,336)
Treatment Plant Equipment (Asset type:
180)
(369,809)
(18,490)
-
3,175
(385,124)
Treatment Plant (Asset type: 190)
(23,024,370)
(827,659)
-
31,550
(23,820,479)
Solid Waste
Buildings (Asset type: 111)
(309,765)
(8,725)
-
6,415
(312,075)
Machinery and equipment (Asset type: 110)
(1,157,363)
(112,223)
-
1,648
(1,267,938)
Total accumulated depreciation
(59,430,732)
(2,878,969)
-
1,431,578
(60,878,123)
Total capital assets being depreciated, net
74,761,485
257697
5,067,616
3,525,842
-
83,612,640
Business -type activities capital assets, net
$ 93,063,252
$ 803,888
$ 5.067.616
$ -
$ -
$ 98,934,756
Business -type activities depreciation was charged to functions/programs of the primary government as follows:
Business -type Activities:
Water 1,D09,235
Sewer 1,748,786
Solid Waste 120,948
Total Business -type Activities $ 2,878,969
52
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
E. Lang -Term Debt
During the year ended June 30, 2020, the following changes occurred in long-term liabilities:
Balance
Balance
Due within
July 1, 2019
Additions
Reductions
June 30, 2020
1 year
Governmental Activities:
G_O. Bonds
$ 940,000
$ -
$ (485,000)
$ 455,000
$ 225,000
Revenue Bonds
4,965,000
-
(365,000)
4,600,000
195,000
SRF
567,498
-
(24,956)
542,542
25,649
Assessments
1,793,229
15,824
(247,197)
1,561,856
250,452
Contract Debt/Loans
836,667
(192,608)
644,059
162,428
Intermediary Program
488,906
-
(27,210)
461,696
27,482
Compensated Absences'
1,463,133
1,112,923
(1,040,127)
1,535,929
1,093,247
Other postemployment benefits'
2,496,006
1,807,792
(1,393,273)
2,910,605
-
Pensions'
9,224,865
06,646
(45,963)
9,265,548
-
Govemmental Activities Sub
Total $ 22,775,384
$ 3,023,185
$ (3,821,334)
$ 21,977,235
$ 1,979,258
Internal Service Funds:
Compensated Absences
$ 24,951
$ 29,823
$ (17,974)
$ 36,800
$ 26,900
Internal Service Funds Sub
Total $ 24 951
$ 29 823
$ (17,974)
$ 36 800
$ 26 900
Government -wide Governmental Activities
1578706,77
T 3,053,008
(3,839,308)
1722,0767
2,006,158
*The governmental funds that are expected to liquidate the compensated absences, pension, and other postemployment
benefits liabilities are the General, Parks, Ambulance, Building, Light Maintenance, Street Maintenance, and Urban Forestry.
Business -type Activities
Revenue Bonds
$ 405,000
$ (405,000)
$ -
SRF
22,572,473
2,805,231
(1,622,944)
23,755,660 1,731,351
Compensated Absences
308,125
240,151
(213,388)
334,888 213,338
Other postemployment benefits
363,119
262,989
(202,687)
423,421
Pensions
Business -type Activities Sub Total
2�
25,TT4,005
457 606
3,765,9T7
(2,665,168)
2 360 845
26,874,814 1,944,689
General Obligation Bonds — The City issues general obligation bonds to provide funds for the acquisition and construction
of major capital facilities. General obligation bonds are direct obligations and pledge the full faith and credit of the City.
General obligation bonds outstanding as of June 30, 2020 were as follows:
Origination Interest Due Principal Annual Balance
Purpose Date Rate Term Date Amount Payment June 30, 2020
Pool/Fire Hall Refunding 6/13/2012 variable 10 years 2022 $ 4,145,000 varies $ 455,000
Total G.O. Bonds s 4,145,000 455,000
53
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Legal Debt Margin
At June 30 the general obligation debt issued by the City did not exceed its legal debt margin as demonstrated by the
following computation:
Total assessed value of taxable property (market value-2020)
$ 3,046,786,429
General limitation percentage
2.50%
General limitation of indebtedness
76,154,661
Outstanding general obligation bonds at June 30
455,0D0
Outstanding bans subject to limitation'
Park Improvements
1 D6,597
Equipment
495,424
City Hall Refinance
42,036
SID 344 Bonds
1,518,000
Total debt subject to limit
2,617,057
Excess limit over outstanding debt margin
$73,537,604
*A State of Montana, Board of Investment's attorney gave an opinion that loans issued under 7-5-4306, MCA are subject to
the limit of indebtedness. These loans are displayed on page 57 (Loans/Contracted Debt).
Special Assessment Debt — Special assessment bonds are secured by a lien on the assessed properties. The primary source
of repayment is the assessments levied against the benefiting properties. However, the City is liable, to an extent, for
repayment of these special assessment bonds. State law authorizes the City to establish a revolving fund to ensure the
payment of debt service on the bonds in the event that assessed property owners default.
Origination
Interest
Due
Principal
Annual
Balance
Purpose
Date
Rate
Term
Date
Amount
Payment
June 30, 2020
SID344
6/15/2006
3.7%-5.1%
20 years
2026
4,520,000
varies
1,370,000
SID345
5/15/2014
3.00%
15 years
2029
242,000
varies
148,000
2012 S&C
114l2010
325%
8 years
2018
7,629
varies
498
2013 S&C
116l2011
3.00%
8 years
2019
942
varies
4,368
2014 S&C
116l2012
3.00%
8 years
2020
5,792
varies
2,942
2015 S&C
4/12/2013
325%
8 years
2021
3,981
varies
4,636
2016 S&C
112l2014
325%
8 years
2022
17,472
varies
6,120
2017 S&C
112l2015
325%
8 years
2023
7,845
varies
3,216
2018 S&C
114l2016
3.50%
8 years
2024
9,273
varies
6,252
2019 S&C
6/30/2016
3.75%
8 years
2025
9,792
varies
15,824
Total Special Assessment Bonds
$ 4,824,726
$ 1,561,856
Revenue Bonds — Revenue bonds are directly related to and paid from the proprietary fund. The 2018 West Side Tax
Increment bonds are accounted for in the Government -wide financial statements and are paid directly from tax increment in
the district.
Issue Interest Final Bonds Balance
Date Rate Term Maturity Issued June 30, 2020
Govemmental Activities-
201 El - West Side TIF May-1 El variable 19 years 2037 4,960,000 4,600,000
Governmental Activities Sub Total $ 4ji0011 $ 4�000
54
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Significant Provisions of the Series 2018 West Side Tax Increment Urban Renewal Revenue Bonds
The 2018 Bonds mature on January 1, 2037. The 2018 Bonds with stated maturities from 2019 through 2028 shall not be
subject to redemption prior to their stated maturities. The 2018 Bonds with stated maturities on or after July 1, 2029 will be
subject to redemption on July 1, 2028 and any day thereafter, at the option of the City, in whole or in part, at a redemption
price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date, without premium.
Interest on the Bonds varies from 3.00% for the Bonds with stated maturities from July 1, 2019 through July 1, 2025 to
5.00% for the $500,000 Term Bond with the stated maturity of January 1, 2033.
Reserve Account — The City shall maintain a debt service reserve account with a balance equal to the lesser of: (i) ten
percent (10%) of the original principal amounts of the Bonds; (ii) the maximum amount of principal and interest payable on
the Bonds in the current or any future fiscal year, or (iii) 125% of the average debt service on the Bonds payable in any fiscal
year.
125% of the average debt service $480,011
City's Reserve $480,011
State Revolving Fund — the City has eleven (11) loan agreements with the State Revolving Fund (SRF). These obligations
are to be repaid from the operating income of the fiord.
SRF LOANS
Interest
Amount
Outstanding
Purpose
Origination Rate
Term
Borrowed
June 30, 2020
Govemmental Activities:
2017 Streets - 4th Ave E
FYI
2.50%
20 years
$ 615,098
$ 542.542
Govemmental Activities Sub Total
$ 615,098
$ 542.542
Business -type Activities:
2013 Sewer - WWTP Digester Lid
FYI
3.00%
20 years
$ 1,102,748
$ 781,000
2012 Sewer - Hwy 93 S
FYI
225%
12 years
1,009,000
366,ODO
2012 Sewer - WWTP System Improvements
FYI
225%
15 years
12,827,000
6,523,01i0
2018 Sewer - Westside Interceptor
FYI
2.50%
30 years
11,49%970
11,148.445
2012 Water - Sheepherders WeIVStorage
FYI
2.25%
15 years
1,340,000
681,ODO
2012 Water - Main & Idaho Main
FYI
2.00%
8 years
404.000
26,01i0
2017 Water - 4th Ave E
FYI
2.50%
20 years
1,974,988
1,742.029
2020 Water - Refunding 2004 Band
FY20
2.50%
5 years
365,648
327.648
2020 Water - 4 ML Dr. Transmission
FY20
2.50%
20 years
2,147,108
2,097,108
2017 Storm Sewer - 4th Ave E
FYI
2.50%
20 years
71,914
63.430
Business -type Activities Sub Total
$ 32,742,376
$ 23,755,660
Total SRF Loans
$ 33,357,474
$ 24,298,202
Water Debt Required Information
Debt Service Account - Monthly an amount equal to not less than 116 of the interest due within the next six months and 1112
of the principal to become due within the next twelve months shall be credited to the debt service account. The debt service
account was zero as of June 30, 2020, as all debt service payments were made as of the end of the fiscal year, leaving no
accrued interest or principal balance.
Reserve Account - The City shall keep in the reserve account an amount equal to or greater than 50% of the maximum
amount of principal and interest required in the current or any subsequent fiscal year ($489,982 * 0.50 = $244,991). As of
June 30, 2020, the debt service reserve account contains $524,854.
Maximum P & I $ 489,982
Total Reserve Requirement $ 244991
Reserve balance 6/30/20 $ 524,854
55
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Property Insurance - The City will cause all buildings, properties, fixtures, and equipment to be kept insured in amounts that
are ordinarily carried.
Liability Insurance - The City will carry insurance against liability of the City and its employees.
Rates and Charges — Rates and charges will be made and kept sufficient to provide gross income and revenues adequate to
pay promptly the reasonable and current expenses of operating and maintaining the system and to produce in each fiscal year
net revenues in excess of such current expenses, equal to 110% of the maximum amount of principal and interest payable
from the Revenue Bond Account in any subsequent fiscal year.
Water Fund Cash Flow Debt Coverage
Water Service Charges $ 3,023,192
Misc. Revenue 232,240
Total Operating Revenue 3,255,432
Less: Operating Expense {excludes depreciation} 2 030 838
Available for Debt Service 1 224 594
`*Maximum Debt Service 489,982
Estimated Coverage FY20 2.50
"includes all water fund borrowings
Seiver Debt Required Information
Operating Reserve — The city shall keep in the operating reserve account an amount equal to one month's operating expenses.
As of June 30, 2020, the operating reserve account contains $280,000.
Debt Service Account - Monthly an amount equal to not less than 116 of the interest due within the next six months and 1112
of the principal to become due within the next twelve months shall be credited to the debt service account. The debt service
account was zero as of June 30, 2020, as all debt service payments were made as of the end of the fiscal year, leaving no
accrued interest or principal balance.
Reserve Account - The City shall keep in the reserve account an amount equal to or greater than 50% of the maximum
amount of principal and interest required in the current or any subsequent fiscal year ($1,847,448 * 0.50 = $923,724). As of
June 30, 2020, the debt service reserve account contains $1,371,043.
Rates and Charges — Rates and charges will be made and kept sufficient to provide gross income and revenues adequate to
pay promptly the reasonable and current expenses of operating and maintaining the system and to produce in each fiscal year
net revenues in excess of such current expenses, equal to 110% of the maximum amount of principal and interest payable
from the Revenue Bond Account in any subsequent fiscal year.
Sewer Fund Cash Flow Debt Coveraoe
*Operating Revenue
$ 6,342,953
Total
6,342,953
Less: Operating Expense (excludes depreciation)
4,124,820
Available for Debt Service
2,218,133
—Maximum Debt Service
1,847,448
Estimated Coverage FY20
120%
*includes storm sewer assessments/interest revenue
**includes all sewerlstorm fund borrowings
56
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
LoanslContracted Debt
Origination
Interest
Due
Principal
Balance
Purpose
Date
Rate
Term
Date
Amount
June 30, 2020
Governmental Activities
BOI: Woodland Playground (parks)
812312019
varies
5 years
2/15/2025
97,772
88,655
BO1201 1 st Ave E - City Hall
911112015
varies
5 years
8/1512020
412,571
42,036
BOI:Chip Truck (Forestry)
1IBM 6
varies
5 years
2/1512021
34,498
7,025
BOI:Flatbed Chevy (Parks)
11 12312016
varies
5 years
211512O22
31,066
12,736
BOI:Mower (Parks)
3/31/2017
varies
5 years
2/15/2022
59,707
24,583
BOI:Woodland Bathroom (Parks)
613012017
varies
5 years
2/15/2022
39,214
17,943
BOI:Mower (Parks)
211612018
varies
5 years
2/15/2023
35,191
21,634
BOI:Spray Gator (Parks)
613012018
varies
5 years
2/15/2023
26,336
17,924
BOI:Fire Pumper
311612018
varies
10 years
2/15/2028
467,684
391,027
BOI:Chip Truck (Forestry)
1113UD17
varies
5 years
2/15/2022
40,000
20,496
Sub total BOI
loans
$1,244,039
$ 6440�
USDA: Intermediary
Relending Program
10112/2004
1.00%
30 years
1011212034
$ 520,000
$ 305,990
Relending Program
11127/2D06
1.00%
30 years
11/27/2036
257,500
155,706
Sub total USDA Intermediary
777,500
461,696
Total loans/contracted debt
- Governmental Activities
$ 2.021.539
$ 1.105,755
BOI - Board of Investments Intercap Loan Program
57
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Requirements to amortize debt
The annual requirements to amortize all long-term debt outstanding, excluding compensated absences payable, as of June 30,
2020, were as follows:
Govemmental Activities:
G.O.
OR FISCAL BONDS
EAR ENDED PRINCIPAL INTEREST
SPECIAL
ASSESSMENT CONTRACTED INTERMEDIARY SRF REVENUE
BONDS LOANSIDEBT LOAN PROGRAM LOANS BONDS
PRINCIPAL INTEREST PRINCIPAL INTEREST PRINCIPAL INTEREST PRINCIPAL INTEREST PRINCIPAL INTEREST TOTAL
2021
225,000
9,100
250,453 76,114 162,428 14,830 27,482 4,617
25,649
13,405
195,000 169225
1.173,303
2022
230,000
4,600
249,955 63.636 116,245 12.041 27,757 4,342
26,573
12,758
205,000 163,375
1,116,282
2023
250,771 51.452 80,306 9,135 28,034 4,064
27266
12,088
210,000 157225
830,341
2024
249,790 39,016 68,782 7,127 28,314 3,784
27,729
11,406
215,000 150,925
801,873
2025
252,631 26,582 60,055 5,407 28,598 3,501
28,191
10,707
220,000 144,475
780,147
2026-2030
308256 17,280 156,243 7,058 147,337 13.158
153,430
42,488
1220,000 613,350
2,679,400
2031-2035
- 154,775 5,643
175,844
22,096
1,465,000 363,175
2,186,533
2036-2040
19,399 290
77,860
2.254
870,000 45,600
1,015,403
TOTAL $
455,000 $
13,700 $
1,561,856 $ 274,080 $ 644,059 $ 56,398 $ 461,696 $ 39.399
$ 542,542
$127,202
$4,600,000 $1,807,350
$10,583,282
Business -type
Activities:
SRF
OR FISCAL
LOANS(1)
EAR ENDED
PRINCIPAL
INTEREST
TOTAL
2021
1,709.459
623,753
2,333.212 (1 ) The 2019 sewer fund SRF loan and
2022
1,667.427
554,698
2,222.125 the 202D water fund SRF loan are
2023
1,706.734
514,876
2,221.610 included on this schedule. The City is still
2024
1,749.920
474,477
2,224.397 drawing funds for these loans. An amortization
2025
1,603.809
437,822
2,041,631 schedule will not be available until all funds have
2026-2030
5,167.570
1,692,748
6,860.318 been drawn. Therefore, some of these numbers
2031-2035
3,227.156
1,186,482
4,413.638 are estimated.
2036-2040
2,942.140
738,763
3,680.903
2041-2045
2,355.000
355,7D0
2,710.700
2046-2050
1,626,445
63,213
1,689,658
TOTAL
$23,755.660
$6,642,532
$ 30,398.192
59
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
F. Employee Benefit Plans
Pension Plans
Substantially all City of Kalispell full-time employees participate in one of three statewide, cost sharing, multiple -employer
retirement benefit plans administered by the Public Employees Retirement Board (PERB). The authority to establish or
amend contribution requirements for all plans, and provide cost of living adjustments for defined benefits plans is assigned to
the State legislature. PERB issues a publicly available comprehensive annual financial report that includes financial
statements and required supplementary information for these plans. It is available from the Montana Public Employees'
Retirement Administration (MPERA) at 100 North Park Avenue, Suite 200, P.O. Box 200131, Helena, Montana, 59620-0131
or at their website, http://inpera.int. 2ov.
The Montana Public Employees Retirement Administration (MPERA) prepares its financial statements using the accrual
basis of accounting. For the purposes of measuring the net pension liability, deferred inflows of resources and deferred
outflows of resources related to pensions, pension expense, information about the fiduciary net position and additions to, and
deductions from, fiduciary net position have been determined on the same accrual basis as they are reported by MPERA. For
this purpose, member contributions are recognized in the period in which contributions are due. Employer contributions are
recognized when due and the employer has made a formal commitment to provide the contributions. Revenues are
recognized in the accounting period they are earned and become measurable. Benefit payments and refunds are recognized in
the accounting period when due and payable in accordance with the benefit terms. Expenses are recognized the period
incurred. Investments are reported at fair value. MPERA adheres to all applicable Governmental Accounting Standards
Board (GASB) statements.
Total City of Kalispell pension expense from all three (3) plans (PERS, MPORS, FURS) the City participates in were
$1,551,103. Contributions to pension plans areas required by state statue. Information about each plan follows:
PUBLIC EMPLOYEES' RETIREMENT SYSTEM — DEFINED BENEFTT
GASB 68 NOTES TO THE FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUKE 30, 2020
(REPORTING DATE), DUNE 30, 2019 (MEASUREMENT DATE)
In accordance with GASB Statement 68, Accounting and Financial Reporting for Pensions, employers and the non -employer
contributing entity are required to recognize and report certain amounts associated with participation in the Public
Employees' Retirement System Defined Benefit Retirement Plan (the Plan). This includes the proportionate share of the
collective Net Pension Liability; Pension Expense; and Deferred Outflows and Deferred Inflows of Resources associated
with pensions. Employers are provided guidance in GASB Statement 68, paragraph 74, where pension amounts must be
combined as a total or aggregate for reporting, whether provided through cost -sharing, single -employer, or agent plans. This
report provides information for employers who are using a June 30, 2019 measurement date for the 2020 reporting. If an
employer's fiscal year end is after June 30, the employer will not use the measurements shown in this report but will need to
wait for the measurement date as of June 30, 2020.
Summary of Significant Accounting Policies
MPERA prepared financial statements using the accrual basis of accounting. The same accrual basis was used by MPERA
for the purposes of determining the Net Pension Liability (NPL); Deferred Outflows of Resources and Deferred Inflows of
Resources related to pensions; Pension Expense; the Fiduciary Net Position; and, Additions to or Deductions from Fiduciary
Net Position. Member contributions are recognized in the period in which contributions are due. Employer contributions are
recognized when due and the employer has made a formal commitment to provide the contributions. Revenues are
recognized in the accounting period they are earned and become measurable. Benefit payments and refirnds are recognized in
59
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
the accounting period in which they are due and payable in accordance with the benefit terms. Expenses are recognized in the
period incurred. Investments are reported at fair value. MPERA adhered to all accounting principles generally accepted by
the United States of America. MPERA applied all applicable pronouncements of the Governmental Accounting Standards
Board (GASB).
General Information about the Pension Plan
Plan Description: The PERS-Defined Benefit Retirement Plan (DBRP), administered by the Montana Public Employee
Retirement Administration (MPERA), is a multiple -employer, cost -sharing plan established July 1, 1945, and governed by
Title 19, chapters 2 & 3, Montana Code Annotated (MCA). This plan provides retirement benefits to covered employees of
the State, and local governments, and certain employees of the Montana University System, and school districts. Benefits are
established by state law and can only be amended by the Legislature.
All new members are initially members of the PERS-DBRP and have a 12-month window during which they choose to
remain in the PERS-DBRP or join the PERS-DCRP by filing an irrevocable election. Members may not be participants of
both the defined benefit and defined contribution retirement plans. All new members from the universities also have a third
option to join the university system's Montana University System Retirement Program (MUS-RP).
Benefits provided: The PERS-DBRP provides retirement, disability, and death benefits to plan members and their
beneficiaries. Benefits are based on eligibility, years of service, and highest average compensation (HAC). Member rights are
vested after five years of service.
Service retirement:
• Hired prior to July 1, 2011
o Age 60, 5 years of membership service
o Age 65, regardless of membership service
o Any age, 30 years of membership service
• Hired on or after July 1, 2011
o Age 65, 5 years of membership service
o Age 70, regardless of membership service
Early Retirement:
• Hired prior to July 1, 2011
o Age 50, 5 years of membership service
o Any age, 25 years of membership service
• Hired on or after July 1, 2011
o Age 55, 5 years of membership service
Second Retirement: (requires returning to PERS-covered employer or PERS service)
• Retired before January 1, 2016 and accumulate less than 2 years additional service credit or retired on or after
January 1, 2016 and accumulate less than 5 years additional service credit:
o A refund of member's contributions plus return interest (currently .77% effective July 1,
2017);
o No service credit for second employment;
o Start the same benefit amount the month following termination; and
o Guaranteed Annual Benefit Adjustment (GAGA) starts again in the January immediately
following the second retirement.
.F
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
■ Retired before January 1, 2016 and accumulate at least 2 years of additional service credit:
o A recalculated retirement benefit based on provisions in effect after the initial retirement;
and
o GABA starts on the recalculated benefit in the January after receiving the new benefit for 12
months.
■ Retired on or after January 1, 2016 and accumulate 5 or more years of service credit:
o The same retirement as prior to the return to service;
o A second retirement benefit as prior to the second period of service based on laws in effect
upon the rehire date; and
o GABA starts on both benefits in the January after receiving the original and the new benefit
for 12 months.
Member's highest average compensation (RAC)
■ Hired prior to July 1, 2011 - highest average compensation during any consecutive 36 months;
■ Hired on or after July 1, 2011 — highest -average compensation during any consecutive 60 months.
Compensation Cap
■ Hired on or after July 1, 2013 — 110% annual cap on compensation considered as a part of a member's highest
average compensation.
Monthly benefit formula
■ Members hired prior to July 1, 2011
o Less than 25 years of membership service: 1.785% of HAC per year of service credit;
0 25 years of membership service or more: 2% of HAC per year of service credit.
■ Members hired on or after July 1, 2011
o Less than 10 years of membership service: 1.5% of HAC per year of service credit;
0 10 years or more, but less than 30 years of membership service: 1.785% of HAC per year of
service credit;
o 30 years or more of membership service: 2% of HAC per year of service credit.
Guaranteed Annual Benefit Adjustment (GABA)
After the member has completed 12 full months of retirement, the member's benefit increases by the applicable percentage
(provided below) each January, inclusive of all other adjustments to the member's benefit.
■ 3.0% for members hired prior to July 1, 2007
■ 1.5% for members hired between July 1, 2007 and June 30, 2013
■ Members hired on or after July 1, 2013:
(a) 1.5% for each year PERS is funded at or above 90%;
(b) 1.5% reduced by 0.1 % for each 2.0% PERS is funded below 90%; and
(c) 0% whenever the amortization period for PERS is 40 years or more.
Contributions: The state Legislature has the authority to establish and amend contribution rates. Member and employer
contribution rates are specified by Montana Statute and are a percentage of the member's compensation. Contributions are
deducted from each member's salary and remitted by participating employers.
Special Funding: The state of Montana, as the non -employer contributing entity, paid to the Plan, additional contributions
that qualify as special funding. Those employers who received special funding are all participating employers.
61
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Not Special Funding: Per Montana law, state agencies and universities paid their own additional contributions. The employer
paid contributions are not accounted for as special funding for state agencies and universities but are reported as employer
contributions.
Member and employer contribution rates are shown in the table below.
State &
Member Universities Local Government School Districts
Fiscal Hired Hired
Year <71U1111 >7101111 Employer Employer State Em io er State
2020
7.9%
7.9%
8.770%
8.670%
0.10%
8.40%
0.370%
2019
7.9%
7.9%
8.670%
8.570%
0.10%
8.30%
0.370%
2018
7.9%
7.9%
8.570%
8.470%
0.10%
8.20%
0.370%
2017
7.9%
7.9%
8.470%
8.370%
0.10%
8.10%
0.370%
2016
7.9%
7.9%
8.370%
8.270%
0.10%
8.D0%
0.37D%
2015
7.9%
7.9%
8.270%
8.170%
0.10%
7.90%
0.370%
2014
7.9%
7.9%
8.170%
8.070%
0.10%
7.80%
0.370%
2012-2013
6.9%
7.9%
7.170%
7.070%
0.10%
6.80%
0.370%
2010-2D11
6.9%
1 7.170%
7.070%
0.10%
6.80%
0.370%
2008-2009
6.9%
1 7.1y3596
6.93596
0.10%
6.80%
U-2
2000-2007
6.9%
1 6.900%
6.8W%
0.10%
6.80%
0.100%
1. Member contributions to the system of 7.9% are temporary and will be decreased to 6.9% on January 1 following
actuary valuation results that show the amortization period has dropped below 25 years and would remain below 25 years
following the reduction of both the additional employer and additional member contribution rates.
2. Employer contributions to the system:
a. Effective July 1, 2014, following the 2013 Legislative Session, PERS-employer contributions increase an additional
0.1 % a year and will continue over 10 years through 2024. The additional employer contributions including the
0.27% added in 2007 and 2009, will terminate on January 1 following an actuary valuation that shows the
amortization period of the PERS-DBRP has dropped below 25 years and remains below the 25 years following the
reduction of both the additional employer and member contributions rates.
b. Effective July 1, 2013, employers are required to make contributions on working retirees' compensation. Member
contributions for working retirees are not required.
c. The portion of employer contributions allocated to the PCR are included in the employers reporting. The PCR was
paid off effective March 2016 and the contributions previously directed to the PCR are now directed to member
accounts.
Non Employer Contributions:
a. Special Funding
i. The State contributes 0.1 % of members' compensation on behalf of local government entities.
ii. The State contributes 0.37% of members' compensation on behalf of school district entities.
iii. The state contributed a Statutory Appropriation from the General Fund of $33,454,182.
62
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Pension Liability, Pension Expense, and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
GASB Statement 68 allows a measurement date of up to 12 months before the employer's fiscal year-end can be utilized to
determine the Plan's TPL. The basis for the TPL as of June 30, 2019, was determined by taking the results of the June 30, 2018,
actuarial valuation and applying standard roll forward procedures. The roll forward procedure uses a calculation that adds the
annual normal cost (also called the service cost), subtracts the actual benefit payments and refinnds for the plan year, and then
applies the expected investment rate of return for the year. The roll forward procedure will include the effects of any assumption
changes and legislative changes. The update procedures are in conformity with Actuarial Standards of Practice issued by the
Actuarial Standards Board.
The Total Pension Liability (TPL) minus the Fiduciary Net Position equals the Net Pension Liability (NPL). The proportionate
shares of the employer's and the state of Montana's NPL for June 30, 2019, and 2018, are displayed below. The employer's
proportionate share equals the ratio of the employer's contributions to the sum of all employer and non -employer contributions
during the measurement period. The state's proportionate share for a particular employer equals the ratio of the contributions for
the particular employer to the total state contributions paid.
Percent of
Percento
Net Pension
Net Pension
Collective
Collective
Change in
Liability as of
Liability as of
NPL as of
NPL as of
Percent of
As of measurement date
6/30/2019
6/3012019
6/3012019
6/30/2018
Collective NPL
Em r Proportionate Share
$ 7,271,35600
$ 7,150,09900
0.347860%
0.342578%
0.005282%
State of Montana
Proportionate Share
associated with the Employer
1 $ 2,365,647.00
1 $ 2,393,378.00
1 0.113172%
0.114673%
-0.0015019'0
Total
1 $ 9,637,003.00
1 $ 9,543,477.00
1 0.461032%
0.457251%
0.011378190
Changes in actuarial assumptions and methods: There were no changes in assumptions or other inputs that affected the
measurement of the TPL.
Changes in benefit terms: There have been no changes in benefit terms since the previous measurement date.
Changes in proportionate share: There were no changes between the measurement date of the collective NPL and the employer's
reporting date that are expected to have a significant effect on the employer's proportionate share of the collective NPL.
Pension Expense: At June 30, 2019(Two years of pension expense are documented in the table below but are not necessary for
the employer's disclosure).
As of measurement date
Pension Expense as of
6/30/2019
Pension Expense as of
6/30/2018
Employers Proportionate Share of PERS
$ 839,436.00
$
543,178.00
Employer Grant Revenue - State of Montana
Proportionate Share for employer
$ 5,891.00
$
159,732.00
Employer Grant Revenue - State of Montana
Appropriation for employer
$ 154,711.00
$
-
Total
$ 1,000,038.00
$
702,910.00
63
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Recognition o, f Deferred Inf ows and Ou fflows: At June 30, 2019, the employer reported its proportionate share of the Plan's
deferred outflows of resources and deferred inflows of resources from the following sources:
Deferred Outflows of
Resources
Deferred Inflows of Resources
Expected vs_ Actual Experience
$ 344 791.00
$ 342 146.00
Projected Investment Eamings vs. Actual
Investment Earnings
$ 88163.00
$
Changes in Assumptions
$ 308 691.00
$ -
Changes in Proportion and Differences Between
Employer Contributions and Proportionate Share
of Contributions
I $ -
I $ 767,733
Employer Contributions Subsequent to the
Measurement Date
$ 563 246.00
Total
$ 1 304 891.00
$ 1,109,87900
Other amounts reported as deferred outflows and inflows of resources related to pensions are recognized in the employer's
pension expense as follows:
For the Measurement
Year ended June 30:
Recognition of Deferred Outflows and Deferred Inflows in future
years as an increase or (decrease) to Pension Expense
2020
$
80 958.00
2021
$
561 116.00
2022
$
32 797.00
2023
$
79 126A0
Thereafter
$
-
Actuarial Assumptions: The total pension liability in the June 30, 2020 (June 30, 2019, measurement date), actuarial valuation
was determined using the following actuarial assumptions.
Investment Return net of admin expense)
7.65%
Admin Expense as % of PayrolI
026%
General Wage Gmwth'
3.50%
'includes Inflation at
2.75%
Merit Increases
0% to 6.3%
Post Retirement Increases
1. Guaranteed Annual Benefia Adjustment
(GABA) each January
■ After the member has completed 12 full months of
retirement, the member's benefit increases by the
applicable percentage (provided below) each January,
inclusive of all other adjustments to the member's benefits.
• Members hired on or after July 1, 2007
3.00%
• Members hired between July 1, 2007 & June 30. 2013
1.50%
• Members hired on or after July 1, 2013
■ For each year PERS is funded at or above 90%
1.50%
• The 1.5% is reduced by 0.1 % for each
2% PERS is funded below 90%
■ CY% whenever the amortization period for PERS
is 40 years or more
Mortality:
• Contributing members, service retired members &
RP-2DD0 Combined Employee
beneficiaries
and Annuitant Mor[alityTables
projected to 2020 with scale BB,
set back one year for males
■ Disable Retirees
PR-2000 Combined Mortality
Table with no projects
64
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
The most recent experience study, performed for the period covering fiscal years 2011 through 2016, is outlined in a report dated
May 5, 2017 and can be located on the MPERA website. The long-term expected return on pension plan assets is reviewed as part
of the regular experience studies prepared for the Plan. Several factors are considered in evaluating the long-term rate of return
assumption including historical rates of return, rate of return assumptions adopted by similar public -sector systems, and by using
a building-block method in which best -estimate ranges of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each major asset class. These ranges were combined to produce the
long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and
by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the target asset
allocation as of June 30, 2018, are summarized in the following table.
Asset Class
Target Asset Allocation
Long -Term Expected Real Rate
of Return
Cash Equivalents
3.0%
4.09%
Domestic Equity
36.0%
6.05%
Foreign Equity
18.0%
7.01 %
Fixed Income
23.0%
2.17%
Private Equitv
12.0%
10.53%
Real Estate
8.0%
5.65%
Total
100%
Discount Rate: The discount rate used to measure the Total Pension Liability was 7.65%. The projection of cash flows used
to determine the discount rate assumed that contributions from participating plan members, employers, and non -employer
contributing entities would be made based on the Board's funding policy, which establishes the contractually required rates
under Montana Code Annotated. The State contributes 0.1% of salaries for local governments and 0.37% for school districts.
In addition, the State contributes coal severance tax and interest money from the general fiord. The interest was contributed
monthly and the severance tax was contributed quarterly. Based on those assumptions, the Plan's fiduciary net position was
projected to be adequate to make all the projected future benefit payments of current plan members through the year 2121.
Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit
payments to determine the Total Pension Liability. A municipal bond rate was not incorporated in the discount rate.
Sensitivity of the proportionate share of the net pension liability to changes in the discount rate: The following presents the
employer's sensitivity of the NPL to the discount rate in the table below. A small change in the discount rate can create a
significant change in the liability. The NPL was calculated using the discount rate of 7.65%, as well as what the NPL would
be if it were calculated using a discount rate 1.00% lower or 1.00% higher than the current rate.
1.0 % Decrease
Current Discount
1.0 % Increase
As of measurement date
6.65 %
Rate
8.65%
Employers Net Pension
Liability
$10 446 867.00
$7 271 356.00
$4 602 740.00
PERS Disclosure for the deimed contribution plan
The City of Kalispell contributed to the state of Montana Public Employee Retirement System Defined Contribution
Retirement Plan (PERS-DCRP) for employees that have elected the DCRP. The PERS-DCRP is administered by the PERK
and is reported as a multiple employer plan established July 1, 2002, and governed by Title 19, chapters 2 & 3, MCA.
All new PERS members are initially members of the PERS-DBRP and have a 12-month window during which they may
choose to remain in the PERS-DBRP or join the PERS-DCRP by filing an irrevocable election. Members may not be
participants of both the defined benefit and defined contribution retirement plans.
65
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Member and employer contribution rates are specified by state law and are a percentage of the member's compensation.
Contributions are deducted from each member's salary and remitted by participating employers. The state Legislature has the
authority to establish and amend contribution rates.
Benefits are dependent upon eligibility and individual account balances. Participants are vested immediately in their own
contributions and attributable income. Participants are vested after 5 years of membership service for the employer's
contributions to individual accounts and the attributable income. Non -vested contributions are forfeited upon termination of
employment per 19-3-2117(5), MCA. Such forfeitures are used to cover the administrative expenses of the PERS-DCRP.
At the plan level for the measurement period ended June 30, 2018, the PERS-DCRP employer did not recognize any net
pension liability or pension expense for the defined contribution plan. Plan level non -vested forfeitures for the 316 employers
that have participants in the PERS-DCRP totaled $746,144.
Pension plan faducian, net position: The stand-alone financial statements (76d) of the Montana Public Employees Retirement
Board (PERK) Comprehensive Annual Financial Report (CAFR) and the GASB 68 Report disclose the Plan's fiduciary net
position. The reports are available from the PERB at PO Box 200131, Helena MT 59620-0131, (406) 444-3154 or both are
available on the MPERA website at http:Ilmi)era.int.govlindex.shtml
MUNICIPAL POLICE OFFICERS' RETIREMENT SYSTEM
GASB 68 NOTES TO THE FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, 2020
(REPORTING DATE), JUNE 30, 2019(MEASUREMENT DATE)
In accordance with GASB Statement 68, Accounting and Financial Reporting far Pensions, employers and the non -employer
contributing entity are required to recognize and report certain amounts associated with participation in the Municipal Police
Officers' Retirement System (the Plan). This includes the proportionate share of the collective Net Pension Liability; Pension
Expense; and Deferred Outflows and Deferred Inflows of Resources associated with pensions. Employers are provided
guidance in GASB Statement 68, paragraph 74, where pension amounts must be combined as a total or aggregate for
reporting. Whether provided through cost sharing, single -employer, or agent plans. This report provides information for
employers who are using a June 30, 2019 measurement date for the 2020 reporting.
Summary of Significant Accounting Policies
MPERA prepared financial statements using the accrual basis of accounting. The same accrual basis was used by MPERA
for the purposes of determining the Net Pension Liability (NPL); Deferred Outflows of Resources and Deferred Inflows of
Resources related to pensions; Pension Expense; the Fiduciary Net Position; and, Additions to or Deductions from Fiduciary
Net Position. Member contributions are recognized in the period in which contributions are due. Employer contributions are
recognized when due and the employer has made a formal commitment to provide the contributions. Revenues are
recognized in the accounting period they are earned and become measurable. Benefit payments and refunds are recognized in
the accounting period in which they are due and payable in accordance with the benefit terms. Expenses are recognized in the
period incurred. Investments are reported at fair value. MPERA adhered to all accounting principles generally accepted by
the United States of America. MPERA applied all applicable pronouncements of the Governmental Accounting Standards
Board (GASB).
.:
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
General Information about the Pension Plan
Plan Description: The Municipal Police Officers' Retirement System (MPORS), administered by the Montana. Public
Employee Retirement Administration (WERA), is a multiple -employer, cost -sharing defined benefit plan established in
1974 and governed by Title 19, chapters 2 & 9, Montana Code Annotated (MCA). This plan provides retirement benefits to
all municipal police officers employed by first- and second-class cities and other cities that adopt the plan. Benefits are
established by state law and can only be amended by the Legislature.
Deferred Retirement Option Plan (DROP): Beginning July 2002, eligible members of MPORS can participate in the DROP
by filing a one-time irrevocable election with the Board. The DROP is governed by Title 19, Chapter 9, Part 12, MCA. A
member must have completed at least twenty years of membership service to be eligible. They may elect to participate in the
DROP for a minimum of one month and a maximum of 60 months and may only participate in the DROP once. A participant
remains a member of the MPORS, but will not receive membership service or service credit in the system for the duration of
the member's DROP period. During participation in the DROP, all mandatory contributions continue to the retirement
system. A monthly benefit is calculated based on salary and years of service to date as of the beginning of the DROP period.
The monthly benefit is paid into the member's DROP account until the end of the DROP period. At the end of the DROP
period, the participant may receive the balance of the DROP account in a lump -sum payment or in a direct rollover to another
eligible plan, as allowed by the IRS. If the participant continues employment after the DROP period ends, they will again
accrue membership service and service credit. The DROP account cannot be distributed until employment is formally
terminated.
Benefits provided: MPORS provides retirement, disability, and death benefits to plan members and their beneficiaries.
Benefits are based on eligibility, years of service, and compensation. Member rights are vested after five years of service.
Service retirement and monthly benefit formula:
■ 20 years of membership service, regardless of age.
■ Age 50 with 5 years of membership service (Early Retirement).
■ 2.5% of FAC x years of service credit.
Second retirement: Re -calculated using specific criteria for members who return to covered MPORS employment prior to
July 1, 2017:
■ Less than 20 years of membership service, upon re-employment, repay benefits and subsequent retirement is based
on total MPORS service.
■ More than 20 years of membership service, upon re-employment, receives initial benefit and a new retirement
benefit based on additional service credit and FAC after re-employment.
Applies to retirement system members re-employed in a MPORS position on or after July 1, 2017:
■ If the member works more than 480 hours in a calendar year and accumulates less than 5 years of service credit
before terminating again, the member:
o is not awarded service credit for the period of reemployment;
o is refunded the accumulated contributions associated with the period of reemployment;
starting the first month following termination of service, receives the same retirement benefit
previously paid to the member; and
o does not accrue post -retirement benefit adjustments during the term of reemployment but
receives a Guaranteed Annual Benefit Adjustment (GABA) in January immediately following
second retirement.
67
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
■ If the member works more than 480 hours in a calendar year and accumulates at least 5 years of service credit
before terminating again, the member:
o is awarded service credit for the period of reemployment;
o starting the first month following termination of service, receives:
* the same retirement benefit previously paid to the member, and
* a second retirement benefit for the period of reemployment calculated based
on the laws in effect as of the members rehire date; and
o does not accrue post -retirement benefit adjustments during the term of reemployment but
receives a GABA:
* on the initial retirement benefit in January immediately following second
retirement, and
* on the second retirement benefit starting in January after receiving that
benefit for at least 12 months.
■ A member who returns to covered service is not eligible for a disability benefit.
Member's final average compensation (FAC)
■ Hired prior to July 1, 1977 - average monthly compensation of final year of service;
■ Hired on or after July 1, 1977 - final average compensation (FAC) for last consecutive 36 months.
Compensation Cap
■ Hired on or after July 1, 2013: 110% annual cap on compensation considered as apart of a member's FAC.
Guaranteed Annual Benefit Adjustment (GABA)
■ Hired on or after July 1, 1997, or those electing GABA, and has been retired for at least 12 months, a GABA will
be made each year in January equal to 3%.
Minimum benefit adjustment (non-GABA)
• The minimum benefit provided may not be less than 50% of the compensation paid to a newly confirmed police
officer of the employer that last employed the member as a police officer in the current fiscal year.
Contributions: The State Legislature has the authority to establish and amend contribution rates to the plan. Member and
employer contribution rates are specified by Montana Statute and are a percentage of the member's compensation.
Contributions are deducted from each member's salary and remitted by participating employers.
Special Funding: MCA 19-9-702 requires the State of Montana to contribute a percentage of total compensation directly to
the Plan annually after the end of each fiscal year. Member, Employer and State contribution rates are shown in the table
below.
Member
Hired
Hired
Hired
Hired
a6130197
Fiscal Year
<711/75
>6130175
>6130179
GAGA
Employer
State
2000-2020
5.800%
7.000°%
8.500%
9.000°%
14.410%
29.370%
1998-1999
7.800%
9.000°%
10.500%
11.000°%
14.410%
29.370%
1997
7.800%
9.000°%
10.500%
14.360%
29.370%
68
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Pension Liabilities, Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions
GASB Statement 68 allows a measurement date of up to 12 months before the employer's fiscal year-end can be utilized to
determine the Plan's TPL. The basis for the TPL as of June 30, 2019 was determined by taking the results of the June 30, 2018
actuarial valuation and applying standard roll forward procedures. The roll forward procedure uses a calculation that adds the
annual normal cost (also called the service cost), subtracts the actual benefit payments and refiinds for the plan year, and then
applies the expected investment rate of return for the year. The roll forward procedure will include the effects of any assumption
changes and legislative changes. The update procedures are in conformity with Actuarial Standards of Practice issued by the
Actuarial Standards Board.
The Total Pension Liability (TPL) minus the Fiduciary Net Position equals the Net Pension Liability (NPL).The proportionate
shares of the employer's and the State of Montana's NPL for June 30, 2019, and 2018, are displayed below. The employer's
proportionate share equals the ratio of the employer's contributions to the sum of all employer and non -employer contributions
during the measurement period. Due to the existence of the special funding situation, the state is required to report a proportionate
share of a local government's collective NPL that is associated with the non -state employer. The state's proportionate share for a
particular employer equals the ratio of the contributions for a particular employer to the total state contributions paid.
Percent of
Percent of
Changein
Net Pension
Collective
Collective
Percent of
Net Pension Liability as of
Liability as of
NPL as of
NPL as of
Collective
As of measurement date
613012019
613012018
6/3012019
613012018
NPL
Employer Proportionate
Share
$ 3,021,804.00
$ 2,717,519.00
1.518200%
1.586800%
-0.068600%
State of Montana
Proportionate Share
associated with Employer
I $ 6 153 443.00
$ 5 555 145.00
3.091500%
3243700%
-0.152200%
Tatal
1 $ 9 175 247.00
1 $ 8 272 664.00
1 4.609700%
4.830500%
-0220800%
*To be consistent with this year's calculation of the State of Montana Proportionate Share Associated with Employer Percent of Collective NPL, the June 30,
2018 percentage has been recalculated using the actual State percentage presented on the allocation calculation instead of the 100% displayed last year. Ais
does not change the dollar amount of the Net Pension Liability as of 613012018, just the percentage.
Charges in actuarial assumptions and methods: There were no changes in assumptions or other inputs that affected the
measurement of the TPL.
Charges in benefit terms: There have been no changes in benefit terms since the previous measurement date.
Charges in proportionate share: There were no changes between the measurement date of the collective NPL and the employer's
reporting date that are expected to have a significant effect of the employer's proportionate share of the collective NPL.
Pension Expense: At June 30, 2018 measurement date (Two years of pension expense are documented in the table below but are
not necessary for the employer's disclosure).
As of measurement date
Pension Expense as of
613012019
Pension Expense as of
613012018
Employers Proportionate Share
472 994.04
342 661.00
Employer Grant Revenue - State of Montana Share for
Employer
$ 737 131.00
$ 765 787.00
Total
1,210,125.00
lCl08,448.00
69
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Recognition o, f Deferred Inflows and Outflows: At June 30, 2019, the employer reported its proportionate share of the Plan's
deferred outflows of resources and deferred inflows of resources from the following sources:
Deferred Outflows of
Deferred Inflows of
As of measurement date
Resources
Resources
Expected vs. Actual Experience
$
268 189.00
$
19 197.00
Projected Investment Earnings vs. Actuai Investment
Earnings
$
56,168.00
$
-
Chan es in Assumptions
$
60 771.00
$
-
Changes in Proportion and Differences Between
Employer Contributions and Proportionate Share of
Contributions
$
-
$
100,236.00
Employer Contributions Subsequent to the Measurement
Date
$
369 685.00
Total
I $
754 813.00
1 $
119 433.00
Other amounts reported as defeired outflows and inflows of resources related to pensions will be recognized in pension expense
as follows:
For the Measurement Year
ended June 30:
Recognition of DeferredOutflows and DeferredInflows in
future years as an increase or (decrease) to Pension
Expense
2020
$
145 409.00
2021
$
16 244.00
2022
$
75 741.00
2023
$
28,300
Thereafter
$
-
Actuarial Assumptions: The total pension liability in the June 30, 2019 (June 30, 2018, measurement date), actuarial
valuation was determined using the following actuarial assumptions.
Investment Return (net of admin expense)
7.65%
Ad min Expense as % of Payroll
024%
General Wage Growth*
3.50%
*includes Inflation at
2.75%
Merit Increases
0% to 6.60%
Post Retirement Increases
1 _ Guaranteed Annual Benefit Adjustment
(GAGA) each January
• Members hired on or after July 1, 1997,
3.00%
or those electing GABA
• Requires 12 full months of retirement
before GAGA will he made
2. Minimum Benefit Adjustment (non-GABA)
The minimum benefit provided should not
• Benefit for a retired member or member's
be less than 50% of the monthly
survivor and member did not elect GABA
compensation paid to a newly confirmed
police officer of the employer that last
employed the member as a police officer
Mortality:
• Contributing members, Service Retired
RP-2000 Combined Employee and
Members & beneficiaries
Annuitant Mortality Tables projected to
2020 with scale BB, set back one year
for males
■ Disabled Retirees
PR-2000 Combined Mortality Table with
no projects
70
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
The most recent experience study, performed for the period covering fiscal years 2011 through 2016, is outlined in a report
dated May 5, 2017 and can be located on the MPERA website. The long-term expected return on pension plan assets is
reviewed as part of the regular experience studies prepared for the Plan. Several factors are considered in evaluating the long-
term rate of return assumption including historical rates of return, rate of return assumptions adopted by similar public -sector
systems, and by using a building-block method in which best -estimate ranges of expected future real rates of return (expected
returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges were
combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target
asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major
asset class included in the target asset allocation as of June 30, 2019 are summarized below.
Asset Class
Target Asset Allocation
Long- I erm Expected Real
Rate of Return Arithmetic
Basis
Cash Equivalents
3.0%
4.09%
Domestic Equity
36.0%
6.D5°Io
Foreign Equity
18.0%
7.1)1%
Fixed Income
23.0%
2.17%
Private Equity
12.0%
10.53%
Real Estate
8.0%
5.65%
❑a
Discount Rate: The discount rate used to measure the TPL was 7.65%. The projection of cash flows used to determine the
discount rate assumed that contributions from participating plan members, employers, and non -employer contributing entities
would be made based on the Board's funding policy, which established the contractually required rates under the Montana
Code Annotated. The state contributed 29.37% of the salaries paid by employers. Based on those assumptions, the Plan's
fiduciary net position was projected to be adequate to make all the projected future benefit payments of current plan members
through the year 2133. Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the TPL. A municipal bond rate was not incorporated in the discount rate.
Sensitivity of the proportionate share of the netpension liability to changes in the discount rate: The following presents the
employer's sensitivity of the NPL to the discount rate in the table below. A small change in the discount rate can create a
significant change in the liability. The NPL was calculated using the discount rate of 7.65%, as well as what the NPL would
be if it were calculated using a discount rate 1.00% lower or 1.00% higher than the current rate.
1.0% Decrease
Current Discount
1.0% Increase
As of measurement date
6.65%
Rate
8.65%
Employers Net Pension
Liability
$4,442,559.00
$3,021,804.D0
$1,884,500.00
Pension plan fiduciary netposition. The stand-alone financial statements (76d) of the Montana Public Employees Retirement
Board (PERK) Comprehensive Annual Financial Report (CAFR) and the GASB 68 Report disclose the Plan's fiduciary net
position. The reports are available from the PERK at PO Box 200131, Helena MT 59620-0131, (406) 444-3154 or both are
available on the MPERA website at http:Ilmyera.int.gov/index.shtml
71
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
FIREFIGHTERS' UNIFIED RETIREMENT SYSTEM
GASB 68 NOTES TO THE FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED DUNE 30, 2020
(REPORTING DATE), .TUNE 30, 2019 (MEASUREMENT DATE)
In accordance with GASB Statement 68, Accounting and Financial Reporting far Pensions, employers and the non -employer
contributing entity are required to recognize and report certain amounts associated with participation in the Firefighters'
Unified Retirement System (the Plan). This includes the proportionate share of the collective Net Pension Liability; Pension
Expense; and Deferred Outflows and Deferred Inflows of Resources associated with pensions. Employers are provided
guidance in GASB Statement 68, paragraph 74, where pension amounts must be combined as a total or aggregate for
reporting, whether provided through cost -sharing, single -employer, or agent pension plans. This report provides information
for employers who are using a June 30, 2019 measurement date for the 2020 reporting.
Summary of Significant Accounting Policies
MPERA prepared financial statements using the accrual basis of accounting. The same accrual basis was used by MPERA
for the purposes of determining the Net Pension Liability (NPL); Deferred Outflows of Resources and Deferred Inflows of
Resources related to pensions; Pension Expense; the Fiduciary Net Position; and, Additions to or Deductions from Fiduciary
Net Position. Member contributions are recognized in the period in which contributions are due. Employer contributions are
recognized when due and the employer has made a formal commitment to provide the contributions. Revenues are
recognized in the accounting period they are earned and become measurable. Benefit payments and refimds are recognized in
the accounting period in which they are due and payable in accordance with the benefit terms. Expenses are recognized in the
period incurred. Investments are reported at fair value. MPERA adhered to all accounting principles generally accepted by
the United States of America. MPERA applied all applicable pronouncements of the Governmental Accounting Standards
Board (GASB).
General Information about the Pension Plan
Plan Description: The Firefighters' Unified Retirement System (FURS), administered by the Montana Public Employee
Retirement Administration (MPERA), is a multiple -employer, cost -sharing defined benefit plan established in 1981, and
governed by Title 19, chapters 2 & 13, Montana Code Annotated (MCA). This plan provides retirement benefits to
firefighters employed by first and second -lass cities, other cities and rural fire district departments that adopt the plan, and to
firefighters hired by the Montana Air National Guard on or after October 1, 2001. Benefits are established by state law and
can only be amended by the Legislature.
Benefits provided: The FURS provides retirement, disability, and death benefits to plan members and their beneficiaries.
Benefits are based on eligibility, years of service, and highest average compensation (HAC). Member rights are vested after
five years of service.
Service retirement and monthly benefit formula:
■ Hired on or after July 1, 1981, or member has elected to be covered by GABA:
0 20 years of membership service, regardless of age
0 2.5% of HAC x years of service credit
• Hired prior to July 1, 1981, and who had not elected to be covered by GABA, the greater of above, or:
o If membership service is less than 20 years: 2% of the highest monthly compensation
(HMQ for each year of service credit, or
o If membership service is greater or equal to 20 years: 50% of HMC plus 2% of HMC for
each year of service credit in excess of 20
72
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
■ Early retirement: Age 50 with 5 years of membership service - Normal retirement benefit calculated using RAC
and service credit
Second retirement:
Applies to retirement system members re-employed in a FURS position on or after July 1, 2017:
■ If the member works more than 480 hours in a calendar year and accumulates less than 5 years of service credit
before terminating again, the member:
o is not awarded service credit for the period of reemployment;
o is refunded the accumulated contributions associated with the period of reemployment;
o starting the first month following termination of service, receives the same retirement
benefit previously paid to the member; and
o does not accrue post -retirement benefit adjustments during the term of reemployment but
receives a Guaranteed Annual Benefit Adjustment (GAGA) in January immediately following
second retirement.
■ If the member works more than 480 hours in a calendar year and accumulates at least 5 years of service credit
before terminating again, the member is awarded service credit for the period of reemployment;
o starting the first month following termination of service, receives:
* the same retirement benefit previously paid to the member; and
* a second retirement benefit for the period of reemployment calculated based
on the laws in effect as of the members' rehire date, and
o does not accrue post -retirement benefit adjustments during the term of reemployment but
receives a GABA:
* on the initial retirement benefit in January immediately following second
retirement, and
* on the second retirement benefit starting in January after receiving that
benefit for at least 12 months.
■ A member who retums to covered service is not eligible for a disability benefit.
Member's compensation period used in benefit calculation
■ Hired prior to July 1, 1981 and not electing GABA: highest monthly compensation (HMC);
■ Hired after June 30, 1981 and those electing GAGA: highest average compensation (HAC) during any consecutive
36 months (or shorter period of total service).
■ Part-time firefighter: 15% of regular compensation of a newly confirmed full-time firefighter.
Compensation Cap
• Hired on or after July 1, 2013: 110% annual cap on compensation considered as a part of a member's HAC.
Guaranteed Annual Benefit Adjustment (GABA)
Hired on or after July 1, 1997, or those electing GABA, and has been retired for at least 12 months — the member's
benefit increases by 3.0% each January.
Minimum Benefit Adjustment (non-GABA)
A member with 10 or more years of membership service who has not elected to be covered under GABA - the
minimum benefit provided may not be less than 50% of the monthly compensation paid to a newly confirmed active
firefighter of the employer that last employed the member as a firefighter in the current fiscal year.
73
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Contributions: The State Legislature has the authority to establish and amend contribution rates to the plan. Member and
employer contribution rates are specified by Montana Statute and are a percentage of the member's compensation.
Contributions are deducted from each member's salary and remitted by participating employers.
Special Funding: MCA 19-13-604 requires the State of Montana to contribute a percentage of total compensation directly to
the Plan annually after the end of each fiscal year. Member, Employer and State contribution rates are shown in the table
below.
Member
Fiscal Year Non-GABA GABA Employer State
1998 - 2020 9.500% 10.700% 14.360% 32.610%
1997 7.800% 14.360% 32.610%
Pension Liability, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions
GASB Statement 68 allows a measurement date of up to 12 months before the employer's fiscal year-end can be utilized to
determine the Plan's TPL. The basis for the TPL as of June 30, 2019 was determined by taking the results of the June 30, 2018
actuarial valuation and applying standard roll forward procedures. The roll forward procedure uses a calculation that adds the
annual normal cost (also called the service cost), subtracts the actual benefit payments and refunds for the plan year, and then
applies the expected investment rate of return for the year. The roll forward procedure will include the effects of any assumption
changes and legislative changes. The update procedures are in conformity with Actuarial Standards of Practice issued by the
Actuarial Standards Board.
The Total Pension Liability (TPL) minus the Fiduciary Net Position equals the Net Pension Liability (NPL). The proportionate
shares of the employer's and the state of Montana's NPL for June 30, 2019, and 2018, are displayed below. The employer's
proportionate share equals the ratio of the employer's contributions to the sum of all employer and non -employer contributions
during the measurement period. Due to the existence of the special funding situation, the state is required to report a
proportionate share of a local government's collective NPL that is associated with the non -state employer. The state's
proportionate share for a particular employer equals the ratio of the contributions for a particular employer to the total state
contributions paid.
Changein
Net Pension
Net Pension
Percent of
Percent of
Percent of
Liability as of
Liability as of
Collective NPL
Collective NPL
Collective
As of measurement date
613012019
613012019
as of 6/3012019
as of 613012019
NPL
Employer Proportionate Share
$ 1 333 236.00
$ 1,482,534.00
1.162200%
1287200%
-0.125000%
State of Montana Proportionate
Share associated with the
Employer
$ 3,224,436.00
$ 3,389,894.00
2.810900%
2.943300%
-0.132400°6
Total
$ 4,557,67200
$ 4 872 428.00
3.973100%
4.230500%
-0.257400°6
To be consistent with this year's calculation of the state ofMontana Proportionate Share Associated with Employer Percent of Collective NPL, the .lime 30, 2018
percentage has been recalculated using the actual State percentage presented on the allocation calculation instead of the 100%displayed last year. This does not
change the dollar amount of the Net Pension Lability as of 613012018, just the percentage.
Charges in actuarial assumptions and methods: There were no changes in assumptions or other inputs that affected the
measurement of the TPL.
Charges in benefit terms: There have been no changes in benefit terms since the previous measurement date.
74
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Changes in proportionate share: There were no changes between the measurement date of the collective NPL and the employer's
reporting date that are expected to have a significant effect on the employer's proportionate share of the collective NPL.
Pension Expense: At June 30, 2019 measurement date (Two years ofpension expense are documented in the table below but are
not necessary for the employer's disclosure).
As of measurement date
Pension Expense as of
613012019
Pension Expense as of
613012018
Employees Proportionate Share
$ 238 673.00
$ 198 441.00
Employers Grant Revenue - State of Montana
Proportionate Share for Employer
$ 671 733.00
$ 682 285.00
Total
$ 910 406.00
1 $ 880 726.00
Recognition of Deferred Inf7ou-s and Outflows: At June 30, 2019, the employer reported its proportionate share of the Plan's
deferred outflows of resources and deferred inflows of resources from the following sources:
Deferred Inflows of
As of measurement date
Deferred Outflows of Resources
Resources
Expected vs. Actual Experience
S 11 %856.00
$ 13,832.00
Projected Investment Earnings vs. Actual Investment
Earnings
$ 44,428.00
$ -
Chan es in Assumptions
$ 98,299.00
$ -
Changes in Proportion and Differences Between
Employer Contributions and Proportionate Share of
Contributions
S -
$ 188,132.00
Employer Contributions Subsequent to the
Measurement Date
S 291,905.00
Total
I S 554,488.00
1 $ 201,964.00
Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense
as follows:
For the Measurement Year
ended June 30:
Recognition of Deferred Outflows and Deferred Inflows in
future years as an increase or decrease to Pension Expense
2020
$ 42 895.00
2021
$ 214.00
2022
$ 37 949.00
2023
726.00
Thereafter
$ 21,166.00
75
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Actuarial Assumptions: The total pension liability in the June 30, 2019 actuarial valuation was determined using the
following actuarial assumptions.
Investment Return net of admin ex ense
7.65%
Admin Expense as % of Payroll
023%
General Wage Growth*
3.50%
*includes Inflation at
2.75%
Merit Increases
0% to 6.30%
Post Retirement Increases
1. Guaranteed Annual Benefit Adjustment
(GABA) each January
• Members hired on or after
3_00%
July 1, 1997 or those electing
GABA
• Requires 12 full months of
retirement before GABA will be
made
2. Minimum Benefit Adjustment (non-GABA)
The minimum benefit provided should be less
• Members with 10 or more years of
than 50% of the current base compensation of a
membership service and member
newly confirmed active firefighter of the employer
did not elect GABA
that last employed the member as a firefighter
Mortality:
■ Contributing members, Service Retired
RP-20DO Combined Employee and
Members & beneficiaries
Annuitant Mortality Tables projected to
2020 with scale BB, set back one year
for males
■ Disabled Members
PR-2000 Combined Mortality Table with
no projections
The most recent experience study, performed for the period covering fiscal years 2011 through 2016, is outlined in a report
dated May 5, 2017 and can be located on the MPERA website. The long-term expected return on pension plan assets is
reviewed as part of the regular experience studies prepared for the Plan. Several factors are considered in evaluating the long-
term rate of return assumption including historical rates of return, rate of return assumptions adopted by similar public -sector
systems, and by using a building-block method in which best -estimate ranges of expected future real rates of return (expected
returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges were
combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target
asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major
asset class included in the target asset allocation as of June 30, 2019 are summarized below.
Asset Class
Tar et Asset Allocation
Long -Term Expected Real
Rate of Return
Cash Equivalents
3.0%
4.09%
Domestic Equity
36.0%
6 05%
Foreign Equity
18.0%
7.01%
Fixed Income
23.0%
2.17%
Private Equity
12.0%
10.53%
Real Estate
8.0%
5.65%
Total
100%
Discount Rate: The discount rate used to measure the TPL was 7.65%. The projection of cash flows used to determine the
discount rate assumed that contributions from participating plan members, employers, and non -employer contributing entities
would be made based on the Board's funding policy, which established the contractually required rates under the Montana
Code Annotated. The state contributed 32.61% of the salaries paid by employers. Based on those assumptions, the Plan's
76
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
fiduciary net position was projected to be adequate to make all the projected future benefit payments of current plan members
through the year 2133. Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the TPL. A municipal bond rate was not incorporated in the discount rate.
Sensitivity of the proportionate share of the net pension liability to changes to the discount rate: The following presents the
employer's sensitivity of the NPL to the discount rate in the table below. A small change in the discount rate can create a
significant change the liability. The NPL was calculated using the discount rate of 7.65%, as well as what the NPL would be
if it were calculated using a discount rate 1.00% lower or 1.00% higher than the current rate.
As of measurement date
1.0 % Decrease
6.651
Current Discount
Rate
1.0 % Increase
8.651
Employer's Net Pension Liability
$2 328 525.00
$1 333 236.00
$530 725.00
Pension plan fiduciary net position: The stand-alone financial statements (76d) of the Montana. Public Employees Retirement
Board (PERB) Comprehensive Annual Financial Report (CAFR) and the GASB 68 Report disclose the Plan's fiduciary net
position. The reports are available from the PERK at PO Box 200131, Helena MT 59620-0131, (406) 444-3154 or both are
available on the MPERA website at http:llmpera.mt.govlindex.shtml
G. Postemployment Health Insurance Benefits (OPEB)
Plan Description. In fiscal year 2020, the City of Kalispell provided employee medical insurance through a single -employer
plan run by the Montana Municipal Interlocal Authority (MMIA). The City also provided dental through single -employer
defined benefit plan. As required by state law (2-18-704, MCA), terminated employees may remain on the City's health
insurance plan for up to 18 months if they pay the monthly premiums. This benefit is required under federal C.O.B.R.A. law.
In accordance with Montana. State law (see below), retirees may remain on the City's health plan as long as they wish. The
City's contract with Allegiance Benefits details the plan eligibility. MMIA is the administrator of the benefit plan, which
covers both active and retired members. The City's retirees may continue coverage for themselves and their covered eligible
dependents if they are eligible for public employees' retirement by virtue of their employment with the City of Kalispell. To
continue coverage, retirees are required to pay the full cost of the benefit. The City's current labor contracts do not include
any obligations for payments to retirees.
Montana Codes Annotated (MCA) Section 2-18-704 states (1) an insurance contract or plan issued under this part must
contain provisions that permit:
(a) The member of a group who retires from active service under the appropriate retirement provisions of a defined
benefit plan provided by law or, in the case of the defined contribution plan provided in Title 19, chapter 3, part 21,
a member with at least 5 years of service and who is a least age 50 while in covered employment to remain a
member of the group until the member becomes eligible for medicare under the federal Health Insurance for the
Aged Act, 42 U.S. C. 1395, as amended, unless the member is a participant in another group plan with
substantially the same or greater benefits at an equivalent cost or group plan with substantially the same or greater
benefits at an equivalent cost:
(b) The surviving spouse of a member to remain a member of the group as long as the spouse is eligible for retirement
benefits accrued by the deceased member as provided by law unless the spouse is eligible for medicare under the
federal Health Insurance for the Aged Act or unless the spouse has or is eligible for equivalent insurance coverage
as provided in subsection (1)(a);
(c) The surviving children of a member to remain members of the group as long as they are eligible for retirement
benefits accrued by the deceased member as provide by law unless they have equivalent coverage in subsection
(1)(a) or are eligible for insurance coverage by virtue of the employment of a surviving parent or legal guardian.
77
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Funding Policy. MMIA health insurance rates are actuarially set annually and benefits altered to ensure the plans remain
properly funded. The City receives a monthly bill that it can allocate to participants as it wishes. The City pays MMIA the
monthly premiums and has no further liability for health claims. The City plans to continue funding the employee health
insurance plan on a "pay as you go" basis, and does not plan to fund this liability since it has paid the full amount due each
month.
OPEB Liabilities, OPEB Expenses, and Deferred Outflows of Resources Related to OPEB. The City's total other post -
employment benefit (OPEB) liability of $3,334,026 as of June 30, 2020, was determined by an actuarial valuation as of that
date. The roll forward procedures included three steps: change the valuation date from June 30, 2019 to June 30, 2020;
update the discount rate to reflect the S&P Municipal Bond 20 Year High Grade Rate Index as of June 30, 2020 and; remove
the impact of the excise tax (Cadillac Tax), as the tax was repealed on December 20, 2019.
Actuarial assumptions and other inputs. The total OPEB liability in the June 30, 2020 actuarial valuation was determined
using the following actuarial assumptions and other inputs, applied to all periods included in the measurement, unless
otherwise specified:
Inflation
Salary increases
Discount rate
Premium trend rate
Retirees share of benefit -related costs
3.00 percent
3.18 percent
2.66 percent
3.50 percent
100 percent of projected premiums for retirees
The discount rate was based on the S&P Municipal Bond 20 Year High Grade Rate Index as of June 30, 2020.
Mortality rates were based on the RP-2000 Combined Mortality Table Projection BB projected to 2020, males set back one
year; consistent with PERS, FURS, and MPDRS Pension Actuarial Valuation 6/30/18.
The actuarial assumptions used in the June 30, 2020 valuation represents a reasonable long-term expectation of future OPEB
outcomes. The assumptions are tested with each valuation for ongoing reasonableness and are updated if appropriate.
Charges in the Total OPEB Liability.
Total OPEB
Liability
OPEB Liability at June 30,2019
2,859,205.00
Changes for the year:
Service cost
$ 253,580.00
Interest
$ 76,055.00
Difference between expected
and actual experience
$ (98,937.00)
Changes in assumptions
$ 244 123.00
OPEB Liability at June 30,2020
$3,334,026
Sensitivity of the Total OPEB Liability to Changes it the Discount Rate. The following table presents the total OPEB
liability of the City, as well as what the City's total OPEB liability would be if it were calculated using a discount rate that is
1 percentage -point lower or higher than the current discount rate.
1 % Decrease Discount Rate 1 % Increase
(1.66%) (2.66%) (3.66%)
Total OPEB Liability $ 4,003,617 $ 3,334,026 $ 2ffl3,611
78
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates. The following table presents the total
OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using a medical trend
rate that is 1 percentage -point lower or higher than the current trend rate.
1 % Decrease Trend Rate 1 % Increase
Total OPEB Liability 2 690,3fi8 3 334,026 $4,187,101
For the year ended June 30, 2020, the City reported deferred inflows and deferred outflows of resources related to OPEB
from the following sources:
Deferred Inflows Deferred Outflows
of Resources of Resources
Differences between expected
and actual experience
Current year amortiZation of
experience differences
Changes in assumptions or other
inputs
Current year amortiZation of
$ (873,307) $ 9,466
$ 96,785 $ (1,252)
$ (923,386) $ 970,008
assumption changes $ 103,948 $ (120,552)
Total $ {1,595,960} $ 857,670
Amounts reported as deferred outflows of resources related to OPEB as of June 30, 2020 will be recognized in OPEB
expense as follows:
Fiscal Year Ending
June 30:
2021
$ (111,861)
2022
$ (111,861)
2023
$ (111,861)
2024
$ (111,861)
2025
$ (111,861)
Thereafter
$ (178,905)
$ (738,290)
79
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
H. Amounts Due From other Governments
On June 30, 2020, the amounts due from other governments consisted of the following:
General Fund Amount
Due from -
Flathead County: -Taxes $ 466,860
State of Montana -Video Gaming Fees $ 650
State of Montana -CARES ACT $1,246,097
U.S. Marshall's Servioe $ 696
Sub Total $1,714,303
Special Revenue Funds
Amount
Due from -
Flathead County -Taxes
$
451,085
Flathead County: -EMS Levy
$
73,428
State of Montana -CARES ACT
$
164,903
Flathead County�Stonegarden
$
4,737
Montana Board of Crime Control
$
12,602
U.S. DOJ
$
5,243
Do MA
$
1,189
Montana DOT
$
3Q600
EPA
$
80,613
Sub Total $
82M00
Debt Servioe Funds Amount
Due from:
Flathead County -Taxes 145,743
Total Governmental Funds $ 2,684,446
Enterprise Funds Amount
Due from:
State of Montana-SRF $ 222,174
Flathead County -Impact Fees $ 23,480
Flathead County -Taxes $ 236 274
Total Business -type Funds 481,928
Total City of Kalispell 3,166,374
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
I. Restricted Cash/Investments
The following restricted cash/investments were held as of June 30, 2020. These amounts are reported within the
cash/investment account on the Combined Balance Sheet.
RESTRICTED CASH:
Business -type Activities
Water Bond Reserve
Plant Investmentllmpact Fees (1)
Sewer Operating Reserve (2)
Bond Reserve
Plant InvestmenVlmpact Fees (sanitary) (1)
Plant InvestmenVlmpact Fees (treatment plant) (1)
Plant InvestmenVlmpact Fees (storm) (1)
Treatment Plant Replacement (3)
Total business -type activities restricted cashfinvestments
Governmental Activities
Impact Fees
Public Safety Growth related Capital (1)
Urban Forestry
Developers (4)
Debt Service
Westside TIF Bond Reserve
Debt Service
Airport TIF Bond Reserve
Debt Service
SID 343 Bond Reserve
Debt Service
SID 345 Bond Reserve
Debt Service
Revolving Fund - SID 344 Bond Reserve
Debt Service
Revolving Fund - SID 345 Bond Reserve
Total govemmental activities restricted cashi-investments
Total restricted cashfinvestments
July 1, 2019 Additions
Subtractions
June 30, 2020
$ 420,469
$ 104.385
$ -
524,854
1,202,252
633.587
(383,313)
1.452,526
190,000
90.000
280,000
1,371,043
-
1.371,043
2,025,492
1,087,544
(751,726)
2.361,310
1,638,651
736.959
(234,013)
2.141,597
2,094,112
209.728
(163,512)
2.140,328
681,281
423.518
(78%617)
315,182
9,623,300
3,285,721
(2,322,181 )
10.586,840
1,112,734 201,588
106,370 17.300
480,011 -
144,500 -
(5,279) 1.309,043
(13,311) 110,359
- 480,011
(1144,51)0)
11,172 -
- 11,172
226,000 -
(80,DD0) 146,000
12,100 -
- 12,100
2,092,887 218,888
243,D90 2.068,685
11.716,187 3,5D4,609
(2,565,271} 12,655,525
(1) Plant investment/impact fee cash. Montana State legislation regulating impact fees to fund capital improvements, MCA
7-6-1601 through 7-6-1604 (see 7-6-1603 below related to expending impact fees), became effective April 19, 2005 and
sets forth the procedures and requirements for the imposition of impact fees by local governments. On October 16, 2006,
by ordinance no. 1587, the Kalispell City Council authorized and established the procedure and imposition of impact
fees to fund capital improvements related to additional capacity (growth).
MCA 7-6-1603 states, "the collection and expenditure of impact fees must be reasonably related to the benefits
accruing to the development paying the impact fees..."
(2) Sewer operating reserve cash is restricted by ordinance no. 859 (1 month operating expenses).
(3) Treatment plant replacement cash is restricted by an agreement with Flathead County Water District (third party).
(4) Urban forestry receives cash from developers to be used to plant trees in new city developments (third party).
J. Restatements
During the 2020 fiscal year, the following adjustments relating to prior years' transactions were made to fund balance or net
position accounts.
Fund Amount Reason
General Fund - Major G(Wtal $ 4-4 687 Prior period expenditures overstated - MPORS adj_
Total Gor`tal funds/Gov'tal activities r 44,687
Sewer Fund - Major Proprietary $ 6,818 Prior period expenditures overstated - retainage adj.
Total Proprietary funds/Business-type activities 6,818
81
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
K. Joint Ventures
Joint ventures are independently constituted entities generally created by two or more governments for a specific purpose,
which are subject to joint control, in which the participating governments retain 1) an ongoing financial interest or 2) an
ongoing financial responsibility.
1. City -County Health Department
The City -County Health Department is operated under an interlocal agreement between Flathead County and the City of
Kalispell. The Department operates under the supervision and control of the City -County Health Board. The Board consists
of seven members, six of whom are appointed by the Board of County Commissioners. The Department is financed, in
addition to revenue generated by providing health services, by the City and the County levying an identical mill levy in order
that all property within the City of Kalispell and all property in Flathead County outside the City limits are taxed equally.
The operation is accounted for in the County Health Fund and is included in the general-purpose financial statements of
Flathead County within the Special Revenue Fund.
2. 911 Dispatch Center
The 911 Dispatch Center is operated under an interlocal agreement between Flathead County, the City of Columbia Falls, the
City of Whitefish, and the City of Kalispell. The Center operates under the supervision and control of the Flathead
Emergency Communications Center Board. The Board consists of six members, the Flathead County Sherif, a County
Commissioner chosen by the Board of County Commissioners, the County Attorney or other elected County officer, and an
elected official or designee from each of the cities of Kalispell, Whitefish, and Columbia Falls. The Department is financed
by funds received by all members from the State (9-1-1 fees) pursuant to Section 10-4-302, M.C.A. Any additional operating
funds needed will be shared proportionally by all members. Under the supervision of the Board, the Director shall hire and
direct staff to carry out the responsibilities of the County's Office of Emergency Services and the Flathead County Fire
Service Area.
L. County Provided Services
The City of Kalispell is provided various financial services by Flathead County. The County serves as cashier and treasurer
for the City for tax assessment collections and other revenues received by the County, which are subject to distribution to the
various taxing jurisdictions located in the County. The collections made by the County on behalf of the City are accounted
for in an agency fund in the City's name and are periodically remitted to the City by the County Treasurer. The County
charges the City for fees associated with City Special Assessments.
M. Risk Management
The City faces a considerable number of risks of loss, including a) damage to and loss of property and contents, b) employee
torts, c) professional liability, i.e., errors and omissions, d) environmental damage, e) workers' compensation, i.e. employee
injuries, and f) medical insurance costs of employees. A variety of methods are used to provide insurance for these risks.
Commercial policies, transferring all risks of loss, except for relatively small deductible amounts are purchased for property
and content damage and professional liabilities. The City participates in two statewide public risk pools operated by the
Montana Municipal Insurance Authority, for workers' compensation and for tort liability coverage. Employee medical
insurance is provided through a statewide health insurance pool administered by MMIA. Given the lack of coverage
available, the City has no coverage for potential losses from environmental damages.
82
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
Effective July 1, 1987 The City of Kalispell joined with other Montana cities to form the Montana. Municipal Insurance
Authority, a self-insurance pool offering Worker's Compensation and Liability Coverage. Both public entity risk pools
currently operate as common risk management and insurance programs for the member governments. The liability limits for
damages in tort action are $750,000 per claim and $1.5 million per occurrence with an $11,250 deductible per occurrence.
State tort law limits the City's liability to $1.5 million. The city pays an annual premium for its employee injury insurance
coverage, which is allocated to the employer funds based on total salaries and wages. The agreements for formation of the
pools provide that they will be self-sustaining through member premiums. The tort liability plan and workers' compensation
program issued bonds in the amount of $4.41 million and $7.610 million, respectively, to immediately finance the necessary
insurance reserves. All members signed a contingent note for a pro rata share of this liability in case operating revenue was
insufficient to cover the debt service. The City's share is $201,445 for liability and $281,715 for Workers' Compensation to
finance the necessary insurance reserves. Based on the plan's current financial position, the City does not expect to make any
payment on these notes. Separate financial statements are available from the Montana Municipal Insurance Authority.
On October 1, 2004, Kalispell signed a 5 year agreement with many other Montana Cities, since then extended, and through
the Montana Municipal Insurance Authority, to create a statewide health insurance pool. The City pays the total monthly
premium for employees who only choose to cover themselves. For employees who choose to cover additional dependents,
the City pays a percentage of the extra costs.
N. Contingencies
The City is a defendant in various lawsuits. Although the outcome of these lawsuits is not presently determinable, it is the
opinion of the City's legal counsel that resolution of these matters will not have a material adverse effect on the financial
condition of the City. The effect on the financial statements cannot be determined at this time due to litigation. Accordingly,
no provision has been made in the financial statements for these contingent liabilities.
0. Receivables
Taxes Receivable
The following governmental funds had taxes receivable at June 30, 2020.
FUND
General - Major Governmental
Source
Taxes
Amount
$ 295,149
Westside TIF
Taxes
4,444
Parks
Taxes
44,622
Old School'Tech' TIF
Taxes
32,211
Old School "Ind' TIF
Taxes
45,407
Health Levy
Taxes
44,827
Light Maintenance District
Taxes
21,241
Street Maintenance - Major Governmental
Taxes
105,386
Urban Forestry
Taxes
23,167
G.O. Bonds
Taxes
23,409
Airport TIF debt service
Taxes
61,358
Westside TIF debt service
Taxes
20,490
SID 344 - Major Governmental
Taxes
1,641,953
SID 345
Taxes
139,740
S & CIS
Taxes
44,372
Total Governmental Funds
$ 2,547,176
Sewer - MajorBusiness-type
Assessments
45,022
Solid waste
Assessments
27,564
Total Business -type Funds
72,586
Total City $ 2,619,762
83
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
Accounts Receivable
At June 30, 2020, the Ambulance fund had accounts receivable deferred net of $297,425. Total net accounts receivable of
the Ambulance fund is $301,029. The difference is the result of $3,604 being receivable, and therefore recognized as
revenue, prior to the Ambulance fund conversion from a proprietary fund to a special revenue fund.
Loans Receivable
Communitv Development Loan Revolvin
Second Avenue West Partners
In August of 2002, the City of Kalispell entered two (2) notes receivable agreements with 2d Avenue West Partners, L.P.
(Hampstead Partners) for property on 2d Avenue West in Kalispell. The property consists of a 40-unit low-income
apartment complex known as 2d Avenue West Independent Living Center. As stipulated in the agreement, this property is
restricted as low-income housing, and shall remain as such for a period of thirty-five years.
One of these notes is for $480,000, and bears interest at 1 % per annum. The second of these notes is for $400,000, and bears
interest at 4.81% per annum. These loans mature on February 28, 2032. Payments of interest on the note are due on or
before the last day of the taxable year, to the extent there is surplus cash, as defined by the note. Unpaid interest shall accrue
until paid, but not compound on the first loan. Payments of principal are not required until the maturity date of the loans.
The notes are secured by a deed of trust on the property. Accrued interest as of June 30, 2020, is $86,055, and $506,808,
respectively.
Community Development Block Grant Economic Development Program
In fiscal year 2007, the City entered a community development program with funding from a community development block grant
economic development program. Eligibility for these low interest loans is tied to the creation of jobs within Kalispell with a
percentage of the jobs created to be filled by low and moderate -income persons.
The following loans have been made by the City using the economic development program fluids
A 15-year loan at 5% to Distinctive Countertops in October 2006.
Original Loan amount
$ 288,619
June 30, 2020 balance
$ 104,736
A 7-year loan at 3% to Norm's
News in August 2017.
Original Loan amount
$ 33,765
June 30, 2020 balance
$ 19,851
A 10-year loan at 6% to SW, LLC in August 2016.
Original Loan amount
$ 50,000
June 30, 2020 balance
$ 31,743
A 6-year loan at 3% to Wheaton's
in May 2018.
Original Loan amount
$ 32,800
June 30, 2020 balance
$ 20,832
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUKE 30, 2020
A 10-year loan at 3% to Wheaton's in February 2020.
Original Loan amount $ 14,191
June 30, 2020 balance $ 13,530
A 10-year loan at 3% to Sail MT & Ameriprise in April 2015.
Original Loan amount $ 17,000
June 30, 2020 balance $ 6,974
Rural Development Loan Revolving
On May 5, 2003, the City Council passed Resolution No. 4780 establishing an Economic Development Revolving Loan Fund
(ED RLF) for small business retention and expansion. The resolution also created an Economic Development Loan Review
Committee to process all applications for assistance. Additionally, on August 16, 2004 and again on November 6, 2006, the
City Council, by Resolution No. 4929 and 5158, respectively, authorized the City Manager to enter into loan agreements with
the United States Department of Agriculture, Rural Development office, in the amount of $520,000 and $750,000. These
monies will be used to assist in the retention and expansion of small business, which may stimulate economic development
activity by assisting the private sector where a funding gap exists and alternative sources of public and private financing are
not adequate.
The following loans have been made by the City using the Rural Development funds:
A 15-year loan at 6.5% to Distinctive Countertops in July 2006.
Original Loan amount
$ 175,000
June 30, 2020 balance
$ 64,538
A 6-year loan at 5.25% to Glacier
Valley Endodontics, Inc. in January 2012.
Original Loan amount
$ 35,000
June 30, 2020 balance
$ 8,538
A 20-year loan at 3% to PKM, LLC (NW Drywall) in January 2020.
Original Loan amount
$ 250,000
June 30, 2020 balance
$ 247,158
A 10-year loan at 3% to Bill
and Jana Goodman in June 2013.
Original Loan amount
$ 34,660
June 30, 2020 balance
$ 8,101
Westside TIF
A 20-year loan at 3% to PKM, LLC (NW Drywall) in January 2020.
Original Loan amount $ 500,000
June 30, 2020 balance $ 494,316
85
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
SUMMARY COMMUNITY DEVELOPMENT LOANS RECEIVABLE
F.sm
CD Loan Revolving
Rural Development Loan Revolving
Westside TIF
IQ
Distinctive Countertops
Norm's News
SMP LLC
Wheatons
Sail MT & Ameriprise
Hampstead Partners'
Hampstead Partners - Interest Porfion'
Distinctive Countertops
Glacier Valley Endodontics, Inc
Bill and Jana Goodman
PKM, LLC [NW DRYWALL]
PKM, LLC [NW DRYWALL]
Total Governmental Funds
'Long Term Loans Receivable - Matures 2632
Amount Pu[pQse
104,736 Jobs
19,852 Jobs
31,743 Jobs
34,362 Jobs
6,974 Jobs
880,000 Low Income Housing
592,863 Low Income Housing
64,538 Small Business
8,538 Small Business
8,101 Small Business
247,158 Small Business
494,316 Redevelopment
$ 2,493,181
P. City Court Contracts Receivable
Contracts receivable of the City Court, because of the uncertainty regarding when and if they will be collected, are no longer
booked as an asset on the statement of net position/balance sheet of the Governmental-TypelGeneral Fund. These
receivables, at June 30, 2020, amounted to $2,603,401.
Q. Wastewater Treatment Plant agreement with Evergreen
In 1990, the City of Kalispell entered into an agreement with the Evergreen Sewer District to convey sewage to the Kalispell
Wastewater Treatment Plant. This agreement expired in July of 2015. A new agreement was reviewed and discussed at a
City Council work session on July 13, 2015.
At a regular meeting of the City Council on July 20, 2015, the new agreement was approved. The new agreement provides
for a rate formula — based on prior fiscal year expenses. The City bills the District, monthly, a base charge per account. The
City also bills for maintenance and operation and replacement costs per the agreement based on metered flows. According
to the new agreement, the Evergreen Sewer District no longer has an equity interest in the reserve/replacement cash account,
which will still be funded by the City.
At a regular meeting of the City Council on May 4, 2020, Council adopted Resolution 5968. This resolution adopted the
2020 Water and Wastewater Rate Study, amended the water and sewer rate schedules, and amended Hiles and regulations
governing water and sewer service. The rate schedule includes the Evergreen rate adjustment agreed upon in the 2015
agreement.
.:
CITY OF KALISPELL
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2020
R. Fund Balance Classification by Major Purposes
The table presented below displays the City's fund balances by major purpose as displayed on page 29, the governmental
funds balance sheet.
Non spendable - not in spendable form
Long-term recievables
Prepaids
Total nonspendable
Restricted
General Government-Heallh Insurance
Public Safety-admin.
Public Safety -EMS
Public Safely -Building Inspection
Public Safety -Fire capital improvements
Public Safety -Police capital improvements
Public Safety -Police equip.
Public Safety -Police personnel
Public Safety -Fire equip.
Public Safety -Fire personnel
Public Works -Street Geanning and Maint.
Public Works -Street Lights
Public Works -roads and streets
Public Works -transportation infrastructure
Culture and Recreation -Park improvements
Culture and Recreation -Equipment
Culture and Recreation -Programs
Culture and Recreation -trees and maintenance
Community Development -
Community Development-0Id School Station
Community Development -South Kalispell TIF
Community Development-Westside TIF
Community Development -Revolving loan funds
Debt Service-SID
Debt Service -Old Schod improvements
Debt Service -Tire Willows improvements
Debt Services & C warrants
Debt Service-G.D. Bonds
Debt Service -Capital
Debt Service -Core area improvements
Debt Service -South Kalispell improvements
Total restricted
Assigned
Capital Equipment
Parking
Miscellaneous
Total assigned
Unassigned
Total fund balances
S. Subsequent Events
Other Total
General
Street
Governmental
Govemmental
Fund
Maint.
Funds
Funds
1,3D0,000
-
-
1,300,000
240,412
13,133
27,804
281.349
1,540,412
13,133
27,804
1,581,349
-
-
121,645
121.645
-
5,725
5.726
-
112,054
112.054
-
1,991,613
1,991,613
-
1.153,652
1,153,652
-
155,392
155.392
-
14,236
14.236
23,434
23.434
-
24,933
24.933
45,066
45.066
3,077.434
21,006
3,098,440
-
629,630
629.630
-
967,869
967.869
165, 873
165.873
-
19,472
19.472
-
22,467
22.467
-
866,064
866.064
-
%5,875
885.875
-
51,151
51.151
-
164,322
164,322
-
2.202,119
2,202,119
-
1,121,265
1,121,265
-
3.1a5,253
3,185,253
-
221,197
221.197
12,121
12.121
24,703
24.703
-
425
425
-
36,884
36,884
-
15,878
15.878
820769
820.769
-
57,277
57.277
3, W 7, 434
15,139, 371
18,216,805
208,906
-
-
208.906
23,542
-
23.542
1.513,595
-
-
1,513,595
1.746,043
-
-
1,746,043
2.507,348
-
(175)
2,507,173
5,793,803
3,090,567
15,167,000
24,051,370
Storm Water Regional Facilities SRF Loan
The Storm Water Regional Facilities project is on schedule to be started in 2021. This project includes designing a regional
detention facility and piping in the north part of the City to prevent flooding created from new development. In fiscal year
2021, to pay the cost of design and construction, the City is in the process of applying for a $3.685 mullion loan agreement
with the State of Montana Department of Natural Resources and Conservation revolving loan fund program (SRF). Impact
fees will be used to repay a portion of this 20-year loan.
87
REQUIRED SUPPLEMENTARY
INFORMATION OTHER THAN
MANAGEMENT DISCUSSION AND
ANALYSIS
City of Kalispell
SCHEDULE OF CITY'S TOTAL LIABILITY AND RELATED RATIOS
OTHER POSTEMPLOYMENT BENEFITS
June 30. 2020
Total OPEB Liability
Service cost
Interest
Difference between expected
and actual experience
Changes in assumptions
Changes in benefit terms
Contributions by employer
Net change in total OPEB liability
Total OPEB liability -beginning (restated)
Total OPEB liability -ending
Covered -employee payroll
Total OPEB liability as a percentage of covered -
employee payroll
Notes to Schedule:
2017 2018 2019 2020
$ 332,296 $ 298,579 $ 227,903 $ 253,580
$ 79,695 $ 137,494 $ 135,435 $ 76,055
$ 13,222 $ (137,426) $ (736,800) $ (98,937)
$ 1,013,936 $ (253,167) $ (798,142) $ 244,123
$ 1,439,149 $ 45,480 $ (1,171,604) $ 474,821
$ 2,546,180 $ 3,985,329 $ 4,030,809 $ 2,859,205
$ 3,985,329 $ 4,030,809 $ 2,859,205 $ 3,334,026
$ 10,456,215 $ 10,748,989 $ 11,430,605 $ 11,587,059
38.11 % 37.50%
Changes of assumptions. Changes of assumptions and other input
reflect the effects of changes in the discount rate each period. The
following are the rates used in each period:
discount
medical trend
6/30/2016
3.80%
4.00%
6/30/2017
3.13%
4.50%
6/30/2018
3.45%
4.50%
6/30/2019
3.36%
3.50%
6/30/2020
2.66%
3.50%
Governmental Accounting Standards Board, Statement 75 requires
this information to be provided for 10 years. Because Fiscal year
2018 was the First year of implementation, 10 years is not available.
25.01 %
pfr growth
2.80%
2.80%
2.80%
3.18%
3.18%
28.77%
See independent auditors report
88
City of Kalispell
SCHEDULE OF CITY CONTRIBUTIONS
OTHER POSTEMPLOYMENT BENEFITS
June 30, 2020
Contractually required contribution
Contributions in relation to the contractually
required contribution
Contribution deficiency [excess
City's covered -employee payroll
Contributions as a percentage of covered -
employee payroll
2017 2018 2019 2020
$ 10,456,215 $ 10,748,989 $ 11,430,605 $ 11,587,059
0% 0% 0% 0%
Governmental Accounting Standards Board, Statement 75 requires
this information to be provided for 10 years. Because fiscal year
2018 was the first year of implementation, 10 years is not available.
See independent auditors report
89
CITY OF KALISPELL, MGNTANA
FISCAL YEAR ENDING DUNE 30, 2020
Public Employees Retirement Plan (PERS)
Required Supplementary Information
Schedule of Proportionate Share of the Net Pension Liability
For the Last Ten Fiscal Years*
Reporting Date:
2020
2019
2018
2017
2016
2015
As of Measurement Date:
2019
2018
2017
2016
2015
2014
Employers proportion of e Net
Pension Liability (percentage)
0.3479%
0.3426%
0.4537%
0.4314%
0.4265%
0.4364%
Employee's Net Pension Liability
amount
$7,271,356
$7,150,099
$8,836,349
$7,348,266
$5,961,419
$5,437,857
State of Montana's Net Pension
Liability amount
2,365,647
2,393,378
117,668
89,787
73,226
66,405
Total
$ 9,637,003.00
$ 9,543,477.00
$ 8,954,017.00
$ 7,438,053.00
$ 6,034,645.00
$ 5,504,262.00
Employers Covered Payroll
$5,739,639
$5,633,887
$5,628,154
$5,167,438
$4,976,919
$4,978,271
Employee's proportionate share as a
percent of Covered Payroll
126.69%
126.91 %
157.00%
142.20%
119.78%
111.22%
Plan Fiduciary Net Position as a
,percent of the Total Pension Liability
73.85%
73.47%
73.75%
74.71 %
78.40%
79.87L
*The amounts presented for each fiscal year were determined as of Jane 30
Schedule rs intended to show information for 10 years. Additional years will be displayed as they became available.
CITY OF KALISPELL, MONTANA
Required Supplementary Information
Schedule of Contributions
For the Last Ten Fiscal Years*
s of most recent - (reporting
date
2020
2019
2018
2017
2016
2015
Contractually Required
Contributions
$563,246
$493,648
$477,191
$471,085
$444,391
S430,109
Plan Choice Rate Required
Contributions
$0
$0
$0
$0
$0
$0
Contributions in Relation to the
Contractually Required Contributions
$563,246
$493,648
$477,191
$471,085
$444,391
S430,109
Contribution Deficient Excess
$0
$0
$0
$0
$0
$0
,Employers Covered Payroll
$6,496,505
$5,739,6391
$5,633,8871
$5,628,154
$5,167,438
$4,976,919
Contributions as a percentage o
Covered Payroll
8.67%
8.60%
8.47%
8.37%
8.60%
8.64%
"The amounts presented for each fiscal year were determned as of June 30
Schedule rs intended to show information for 10 years. Additional years will be displayed as they became available.
all
CITY OF KALISPELL, MONTANA
PERS Notes to the Required Supplementary Information
For the Employer's Fiscal Year Ended June 30, 2020 (June 30, 2019 Measurement Date)
Changes of Benefit Terms
The following changes to the plan provisions were made as identified:
2017
Working Retiree Limitations — for PERS
Effective July 1, 2017, if a PERS retiree returns as an independent contractor to what would otherwise be PERS-covered employment,
general contractor overhead costs are excluded from PERS working retiree limitations.
Refunds
1) Terminating members eligible to retire may, in lieu of receiving a monthly retirement benefit, refund their accumulated contributions in a
lump sum.
2) Terminating members with accumulated contributions between $200 and $1,000 who wish to rollover their refund must do so within 90
days of termination of service.
3) Trusts, estates, and charitable organizations listed as beneficiaries are entitled to receive only a lump -sum payment.
Interest credited to member accounts — Effective July 1, 2017, the interest rate credited to member accounts increased from 0.25% to
0.77%.
Lump -sum payouts
Effective July 1, 2017, lump -sum payouts in all systems are limited to the member's accumulated contributions rate than the present value of
the member's benefit.
Disabled PERS Defined Contribution (DC) Members
PERS members hired after July 1, 2011 have a normal retirement age of 65. PERS DC members hired after July 1, 2011 who became
disabled were previously only eligible for a disability benefit until age 65. Effective July 1, 2017, these individuals will be eligible for a disability
benefit until they reach 70, thus ensuring the same 5-year time period available to PERS DC disabled members hired prior to July 1, 2011
who have a normal retirement age of 60 and are eligible for a disability benefit until age 65.
Changes in Actuarial Assumptions and Methods
Method and assumptions used in calculations of actuarially determined contributions
The following Actuarial Assumptions were adopted from the June 30, 2016 Experience Study:
General Wage Growth'
3.50%
Investment Rate of Return*
7.65%
*Includes inflation at
2.75%
Merit salary increases
0% to 8.47%
Asset valuation method
4-year smoothed market
Actuarial cost method
Entry age Normal
Amortization method
Level percentage of payroll, open
Mortality (Healthy members)
For Males and Females: RP 2000 Combined Employee and Annuitant Mortality Table
projected to 2020 using Scale BB, males set back 1 year
Mortality (Disabled members)
For Males and Females: RP 2000 Combined
Mortality Table
Admin Expense as % of Payroll
0.26%
Administrative expenses are recognized by an additional amount added to the normal cost contribution rate for the System. This amount varies from year to
year based on the prior year's actual administrative expenses.
91
CITY OF KALISPELL, MONTANA
FISCAL YEAR ENDING DUNE 30, 2020
Municipal Police Officers' Retirement Plan (MPORS)
Other Supplementary Information
Schedule of Proportionate Share of the Net Pension Liability
For the Last Ten Fiscal Years*
Reporting Date:
2020
2019
2018
2017
2016
2015
As of Measurement Date:
2019
2018
2017
2016
2015
2014
Employer's proportion ot the Net
Pension Liability (percentage)
1.5182%
1.5868%
1.6383%
1.5682%
1.5255%
1.5019%
Employer's Net Pension Liability
amount
$3,021,804
$2,717,519
$2,914,803
$2,822,947
$2,523,431
$2,359,962
State of Montana's Net Pension
Liability associated with the
6,153,443
5,555,145
5,940,859
5,603,673
5,112,711
4,767,405
Total
$ 9,175,247
$ 8,272,664
$ 8,855,662
$ 8,426,620
$ 7,636,142
$ 7,127,367
Employer's Covered Payroll
$2,502,092
$2,504,658
$2,449,995
$2,213,762
$2,111,268
$2,015,102
Employer's proportionate share as a
percent of Covered Payroll
120.77%
108.50%
118.97%
127.52%
119.52%
117.11 %
Plan Fiduciary Net Position as a
percent of the Total Pension Liability
1 68.84%1
70.95%1
68.34%1
65.62%1
66.90%1
67.01 %
*The amounts presented for each fiscal year were determined as of June 30
Schedule is intended to show information for 10 years. Additional years will be displayed as they become available.
CITY OF KALISPELL, MONTANA
Required Supplementary Information
Schedule of Contributions
For the Last Ten Fiscal Years*
As of most recent HE - (reporting
date)
2020
2019
2018
2017
2016
2015
Contractually Required Contributions
$369,685
$361,987
$374,615
$353,045
$324,287
$306,050
Contributions in Relation to the
Contractually Required Contributions
$369,685
$361,987
$374,615
$353,045
$324,287
$306,050
Contribution Deficient Excess
$0
$0
$0
$0
$0
$0
Em to er's Covered Payroll
$2,565,473
$2,502,092
$2,504,658
$2,449,995
$2,213,762
$2,111,268
nnu oions as a percentage Or
Covered Payroll
14.41%1
14.47%1
14.96%1
14.41%1
14.6,5%1
14.50%
*The amounts presented for each fiscal year were determined as of June 30
Schedule is intended to show information for 10 years. Additional years will be displayed as they become available.
CITY OF KALISPELL, MONTANA
MPORS Notes to the Required Supplementary Information
For the Employer's Fiscal Year Ended June 30, 2020 (June 30, 2019 Measurement Date)
Changes of Benefit Terms
The following changes to the plan provision were made as identified:
2017
Working Retiree Limitations — for MPORS
Applies to retirement system members who return on or after July 1, 2017 to covered employment in the system from which they retired -
Members who return for less than 480 hours in a calendar year:
o May not become an active member in the system-, and
o Are subject to a $1 reduction in their retirement benefit for each $3 earned in excess of $5,000 in the calendar year_
Members who return for 480 or more hours in a calendar year:
o Must become an active member of the system-,
a Will stop receiving a retirement benefit from the system-, and
o Will be eligible for a second retirement benefit if they earn 5 or more years of service credit through their second employment_
Employee, employer and state contributions, if any, apply as follows:
o Employer contributions and state contributions (if any) must be paid on all working retirees-,
Second Retirement Benefit—forMPORS
Applies to retirement system members who return on or after July 1, 2017 to active service covered by the system from which they retired-
- If the member works more than 480 hours in a calendar year and accumulates less than 5 years of service credit before terminating again, the
member-
o is not awarded service credit for the period of reemployment-,
o is refunded the accumulated contributions associated with the period of reemployment-,
o starting the first month following termination of service, receives the same retirement benefit previously paid to the member-, and
o does not accrue post -retirement benefit adjustments during the term of reemployment but receives a Guaranteed Annual Benefit Adjustment
(GABA) in January immediately following second retirement-
- If the member works more than 480 hours in a calendar year and accumulates at least 5 years of service credit before terminating again, the
member-
Refunds
o is awarded service credit for the period of reemployment-,
o starting the first month following termination of service, receives:
the same retirement benefit previously paid to the member, and
a second retirement benefit for the period of reemployment calculated based on the laws in effect as of the member's rehire date-, and
o does not accrue post -retirement benefit adjustments during the term of reemployment but receives a GABA:
• on the initial retirement benefit in January immediately following second retirement, and
• on the second retirement benefit starting in January after receiving that benefit for at least 12 months_
A member who returns to covered service is not eligible for a disability benefit -
Terminating members eligible to retire may, in lieu of receiving a monthly retirement benefit, refund their accumulated contributions in a lump sum-
- Terminating members with accumulated contributions between $200 and $1,000 who wish to rollover their refund must do so within 90 days of
termination of service -
Trusts, estates, and charitable organizations listed as beneficiaries are entitled to receive only a lump -sum payment_
Interest credited to member accounts
Effective July 1, 2017, the interest rate credited to member accounts increased from 0-25% to 0.77%-
Lump-sum payouts
- Effective July 1, 2017, lump -sum payouts in all systems are limited to the member's accumulated contributions rate than the present value of the
member's benefit-
W
Changes in Actuarial Assumptions and Methods
Method and assumptions used in calculations of actuarially determined contributions
The following Actuarial Assumptions were adopted from the June 30, 2017 actuarial valuation:
General Wage Growth*
3.50%
Investment Rate of Return*
7.65%
*Includes inflation at
2.75%
Merit salary increases
0% to 6.60%
Asset valuation method
Four-year smoothed market
Actuarial cost method
Entry Age Normal
Amortization method
Level percentage of pay, open
Mortality (Healthy members)
For Males and Females: RP 2000 Combined Employee and Annuitant
Mortality Table projected to 2020 using Scale 1313, males setback 1 year
Mortality (Disabled members)
For Males and Females- RP 2000 Combined
Mortality Table
Admire Expense as % of Payroll
023%
Administrative expenses are recognized by an additional amount added to the normal cost contribution rate far the System. This amount vanes from year to
year based on the prior year's actual administrative expenses.
4
CITY OF KALISPELL, MONTANA
FISCAL YEAR ENDING JUNE 30, 2020
Firefighters Unified Retirement System (FURS)
Required Supplementary Information
Schedule of Proportionate Share of the Net Pension Liability
For the Last Ten Fiscal Years*
Reporting Date:
2020
2019
2018
2017
2016
2015
As of Measurement Date:
2019
2018
2017
2016
2015
2014
Employer's proportion of the Net
Pension Liability (as a
percentage)
1.1622
1.2872%
1.4637%
1.3965%
1.4196%
1.4283%
Employer's Net Pension Liability
amount
$1,333,236
$1,482,534
$1,654,528
$1,594,992
$1,451,892
$1,394,256
State of Montana's Net Pension
Liability amount
3,224,436
3,389,894
3,757,250
3,613,749
3,233,749
3,145,374
Total
$ 4,557,672
1 $ 4,872,428
1 $ 5,411,778
1 $ 5,208,741
1 $ 4,685,641
1 $ 4,539,630
Employer's Covered Payroll
$2,015,410
$2,027,325
$2,188,185
$1,966,524
$1,907,689
$1,855,316
Employer's proportionate share
as a percent of Covered Payroll
66.15%
73.13%
75.61 %
81.11 %
76.11 %
75.15%
Plan Fiduciary Net Position as a
ercent of the Total Pension
1 80.08%
1 79.03%
1 77.77%1
75.48%1
76.90%1
76.71 %
'The amounts presented for each fiscal year were determined as of June 30
Schedule is intended to show information for 90 years. Additional years will be displayed as they become available.
CITY OF KALISPELL, MONTANA
Required Supplementary Information
Schedule of Contributions
For the Last Ten Fiscal Years*
s of most recent
re ortin date
2020
2019
2018
2017
2016
2015
Contractually Required
Contributions
$291,906
$277,747
$298,390
$314,224
$281,160
$279,275
Contributions in Relation to the
Contractual) Required
$291,906
$277,747
$298,390
$314,224
$281,160
$279,275
Contribution Deficient Excess
$0
$0
$0
$0
$0
$0
Em la er's Covered Payroll
$2,032,772
$2,015,410
$2,027,325
$2,188,185
$1,966,524
$1,907,689
Contrit5utions as a percentage of
Covered Payroll
14.36%
13.78%
14.72%
14.36%1
14.30%1
14.64%
'The amounts presented for each fiscal year were determined as of June 30
Schedule is intended to show information for 90 years. Additional years will be displayed as they become available.
0ji
CITY OF KALISPELL, MONTANA
FURS Notes to the Required Supplementary Information
For the Employer's Fiscal Year Ended June 30, 2020 (June 30, 2019 Measurement Date)
Changes of Benefit Terms
The following changes to the plan provision were made as identified:
2017
Working Retiree Limitations — for FURS
Applies to retirement system members who return on or after July 1, 2017 to covered employment in the system from which they retired.
Members who return for less than 480 hours in a calendar year:
o May not become an active member in the system; and
o Are subject to a $1 reduction in their retirement benefit for each $3 earned in excess of $5,000 in the calendar year.
Members who return for 480 or more hours in a calendar year:
❑ Must become an active member of the system;
❑ Will stop receiving a retirement benefit from the system; and
❑ Will be eligible for a second retirement benefit if they earn 5 or more years of service credit through their second
employment.
Employee, employer and state contributions, if any, apply as follows:
❑ Employer contributions and state contributions (if any) must be paid on all working retirees;
❑ Employee contributions must be paid in working retirees who return to covered employment for 480 or more hours in a
calendar year.
Second Retirement Benefit— for FURS
Applies to retirement system members who return on or after July 1, 2017 to active service covered by the system from which they retired.
If the member works more than 480 hours in a calendar year and accumulates less than 5 years of service credit before
terminating again, the member:
o is not awarded service credit for the period of reemployment;
o is refunded the accumulated contributions associated with the period of reemployment;
o starting the first month following termination of service, receives the same retirement benefit previously paid to the member;
and
o does not accrue past -retirement benefit adjustments during the term of reemployment but receives a Guaranteed Annual
Benefit Adjustment (GABA) in January immediately following second retirement.
If the member works more than 480 hours in a calendar year and accumulates at least 5 years of service credit before
terminating again, the member:
o is awarded service credit for the period of reemployment;
o starting the first month following termination of service, receives:
• the same retirement benefit previously paid to the member, and
• a second retirement benefit for the period of reemployment calculated based on the laws in effect as of the member's
rehire date; and
o does not accrue post -retirement benefit adjustments during the term of reemployment but receives a GAGA:
• on the initial retirement benefit in January immediately following second retirement, and
• on the second retirement benefit starting in January after receiving that benefit for at least 12 months.
A member who returns to covered service is not eligible for a disability benefit.
Refunds
Terminating members eligible to retire may, in lieu of receiving a monthly retirement benefit, refund their accumulated
contributions in a lump sum.
Terminating members with accumulated contributions between $200 and $1,000 who wish to rollover their refund must do so
within 90 days of termination of service.
Trusts, estates, and charitable organizations listed as beneficiaries are entitled to receive only a lump -sum payment.
Interest credited to member accounts
Effective July 1, 2017, the interest rate credited to member accounts increased from 0.25% to 0.77%.
461
Lump -sum payouts
Effective July 1, 2017, lump -sum payouts in all systems are limited to the member's accumulated contributions rate than the present
Changes in Actuarial Assumptions and Methods
Method and assumptions used in calculations of actuarially determined contributions
The following Actuarial Assumptions were adopted from the June 30, 2017 actuarial valuation:
General Wage Growth'
3.50%
Investment Rate of Return'
7.65%
'Includes inflation at
2.75%
Merit salary increases
0% to 6.30%
Asset valuation method
Four-year smoothed market
Actuarial cost method
Entry Age Normal
Amortization method
Level percentage of payroll, open
Mortality (Healthy members)
For Males and Females: RP 2000 Combined
Employee and Annuitant Mortality Table
projected to 2020 using Scale BB, males set back 1
year.
Mortality (Disabled members)
For Males and Females: RP 2000 Combined
Mortality Table
Admin Expense as % of Payroll
0.23%
Administrative expenses are recognized by an additional amount added to the normal cost contribution rate for the System. This amount
varies from year to year based on the prior year's actual administrative expenses.
yr�
RESOURCES (n-FLOWS):
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Miscellaneous
Investment earnings
Amounts available for appropriation
CHARGES TO APPROPRIATIONS (OUTFLOWS);
General government
Public safety
Public works
Community development
Debt service - principal
Debt service - interest
Capital outlay
Total charges to appropriations
OTHER FINANCING SOURCES (USES)
Proceeds from the sale of general capital asset disposition
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balance
Fund balance - beginning of the year
Restatements
Fund balance - beginning of the year - restated
Fund balance - end of the year
City of Kalispell, Montana
Budgetary- Comparison Schedule
For the Fiscal Year Ended June 30, 2020
General Fund
BUDGETED AMOU-NTS
ORIGINAL FINAL
ACTUAL
AMOUNTS VARIANCE
(BUDGETARY WITH FINAL
BASIS) See Nate A BUDGET
$ 6,255,500
$
6,255,500
$ 6,510,495
$
254,995
131,500
131,500
160,015
28,515
4,898,538
4,898,538
3,841,755
(1,056,783)
1,070,671
1,070,671
1,068,087
(2,584)
532,000
532,000
514,035
(17,965)
67,600
67,600
16,660
(50,940)
45,000
45,000
59,622
14,622
$ 13,000,809
$
13,000,809
$ 12,170,669
$
(830,140)
$ 3,400,713
$
3,400,713
$ 3,392,162
$
8,551
9,603,556
9,603,556
8,710,212
893,344
51,251
51,251
47,157
4,094
96,482
96,482
93,117
3,365
43,173
43,173
43,174
(1)
14,633
14,633
14,268
365
287,793
287,793
234,906
52,887
$ 13,497,601
$
13,497,601
$ 12,534,996
$
962,605
925.000
925,000
925,000
-
$ 925,000
$
925,000
$ 925,000
$
-
See independent auditor's report
98
$ 560,673
$ 5,188,443
44,687
$ 5,233,130
$ 5,793,803
RESOURCES (INFLOWS):
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Miscellaneous
Investment earnings
Amounts available for appropriation
CHARGES TO APPROPRIATIONS (OUTFLOWS);
General government
Public safety
Public works
Community development
Debt service - principal
Debt service - interest
Capital outlay
Total charges to appropriations
OTHER FINANCING SOURCES (USES)
Proceeds from the sale of general capital asset disposition
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balance
Fund balance - beginning of the year
Fund balance - end of the year•
City of Kalispell, Montana
Budgetary Comparison Schedule
For the Fiscal Year Ended June 30, 2020
Street Maintenance
ACTUAL
AMOUNTS
VARIANCE
BUDGETED AMOUNTS
(BUDGETARY
WITH FINAL
ORIGINAL
FINAL
BASIS) See Note A
BUDGET
$ 2,706,000 $
2,706,000
$ 2,743,408 $
37,408
-
-
113,149
113,149
7,500
7,500
5,094
(2,406)
5,000
5,000
1,568
(3,432)
22,000
22,000
35,468
13,468
$ 2,740,500 $
2,740,500
$ 2,898,687 $
158,187
2,976,759
2,976,759
2,486,630
490,129
24,955
24,955
24,956
(1)
14,032
14,032
14,032
-
209,678
209,678
214,956
(5,278)
$ 3,225,424 $
3,225,424 $
2,740,574
$ 484,850
6,500
6,500
6,500
-
$ 61500 $
$ -
6,500 $
6,500
See independent auditor's report
99
$ 164,613
$ 2,925,954
$ 3,090,567
CITY OF KALISPELL
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
TUNE 30, 2020
B. Budgetary- Comparison Schedules
BUDGETED FUNDS
The City adopts an annual budget for all of its funds in accordance with Title 7, Chapter 6, Part 40 of the Montana Code Annotated.
Statute requires the adoption of apreliminary budget, public hearings on the preliminary budget and the final adoption of the budget
by the first Thursday after the first Tuesday in September or within 30 calendar days of the receipt of the certified taxable valuations
from the Department of Revenue. The City must also submit a copy of the final budget to the Department of Administration by the
later of October 1 or 60 days after the receipt of taxable values from the Department of Revenue.
State statute limits the making of expenditures or incurring of obligations to the amount of the final budget as adopted or as amended.
Budget transfers and amendments are authorized by law, and in some instances, may require further public hearings. Any budget
amendments providing for additional appropriations must identify the fiord reserves, unanticipated revenue, or previously
unbudgeted revenue that will fund the appropriations.
Appropriations are created by fund, function, and activity and may further be detailed by department. Expenditure limitations
imposed by law extend to the department level which is identified as the legal level of budgetary control.
BUDGETARY BASIS
The City's budgets are prepared on the budgetary basis (modified accrual) of accounting, which results in accounting for certain
funds, proprietary and internal service, on a basis other than generally accepted accounting principles (full accrual). The City's
accounting records are maintained on the basis of cash receipts and disbursements during the year. At year-end, certain
adjustments are made to the City's accounting records to reflect the basis of accounting described above. Reported budget
amounts represent the originally adopted budget and the final budget, which includes amendments. Total fund expenditures may
not legally exceed the budgeted expenditures. The budget lapses at the end of each year. Results of operations, on the budget
basis of accounting, are presented for the general fund and major special revenue funds with legally adopted annual budgets, to
provide a meaningful comparison of actual results with the budget.
See independent auditor's report
100
SUPPLEMENTAL INFORMATION
COMBINING AND INDIVIDUAL
FUND STATEMENTS
1►[i]►1►I.11101Wiii11F►aIA01►1aONKAaim) 01W
■ a ►M N U-JOWN
Airport TIF — Accounts for monies received and expended for approved projects in
this TIF district.
Westside TIF — Accounts for monies received and expended for approved projects in this
TIF district.
Parks in Lieu — Accounts for monies received by developer's for the purpose of making
improvements in specific City parks.
Parks — Accounts for the monies received and expended in the operations of the City's
Parks Department.
Ambulance — Accounts for the monies received and expended in the operations of the
City's Ambulance Department.
Old School TIF's — Accounts for monies received and expended for approved projects in
these TIF districts.
Rail Park TEDD — Accounts for the monies received and expended for approved projects
in and related to the TEDD.
Health Lew — Accounts for revenue from the permissive mill levy which provides
funding for the fiscal year 2003 health insurance premium rate increase.
Building Department — Accounts for all activity of enforcing the building regulations
adopted by the City.
Impact Fees — Accounts for public safety impact fees received and allowed and approved
expenditures of each.
Light Maintenance — Accounts for special assessment revenues levied, received, and
expended for street lighting.
Gas Tax and BARSAA — Accounts for revenues from State gasoline taxes apportioned
from the State of Montana Department of Highways.
Fore s — Accounts for special assessment revenues levied, received, and expended to
care for almost 7000 trees.
MAGI Grant — Accounts for grant monies received and City matching monies used to
purchase equipment (street sweeper) through the Montana Air & Congestion Initiative.
Community Development Loan Revolving Fund — this fund accounts for the lending and
repayment of monies loaned to businesses and individuals for approved community
development projects.
CD Misc. - originally established to account for Urban Development Assistance
Grants (UDAG). These federal dollars were loaned to businesses and individuals for
projects located in economic development zones and approved by the City
Community Development department. The main revenue source for this fund is
borrower's interest payments. In fiscal year 2015, this fund, with dollars borrowed
from the General fund, purchased six undeveloped properties from Flathead County
at the Old School Station Industrial/Teclimcal Park, a City special improvement
district. Taxes on these properties were five to seven years delinquent, thereby
putting the City's SID debt service fund at risk of not making the annual payment.
The City intends to resell these properties for development.
Rural Development Loan Revolving (2) — Accounts for monies received, grant and
other, and expended in the process of providing gap financing for business retention,
expansion, or start-up.
Law Enforcement Grants (Stonegarden, Drug Enforcement) — Accounts for multiple
grants received by the Police Department and all related revenues and expenditures.
EPA Brownfields Grant — Accounts for Brownfields revitalization projects monies to be
used for phase I and phase H environmental assessments.
EPA Brownfields Loan Revolving Grant - Accounts for grant monies received for and
expenditures related to environmental assessments.
Fire Grants - Accounts for multiple grants received by the Fire Department and all related
revenues and expenditures.
Hazmat Grant — Accounts for the grant monies received for and expenditures related to
respond and remedy hazmat calls of the City Fire Department.
DEBT SERVICE FUNDS
G.O. Bonds — Accounts for the debt service payments associated with the Woodland
Water Park and the Fire Station #52 general obligation bonds.
City Hall Debt Service — Accounts for the debt service payments associated with the new
City Hall at 201 1' Avenue East.
Airport TIF Debt Service - Accounts for the debt service payments associated with the
Airport Tax Increment District.
Westside TIF Debt Service - Accounts for the debt service payments associated with the
Westside Tax Increment District.
Debt Service Revolving — Accounts for monies associated with the closing out of debt
service funds and covering other debt service fund payment shortages.
S & Cs - Accounts for the debt service payments associated with Sidewalk & Curb
bonds.
SID 344 - Accounts for the debt service payments associated with the Special
Improvement District #344 bonds.
SID 345 - Accounts for the debt service payments associated with the Special
Improvement District #345 bonds.
S & C Construction Accounts for the monies received for and expenditures related to
sidewalk and curb construction.
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
Airport TEF Westside TEF Parks - in - Lieu Parks Ambulance
ASSETS
Cash and investments
2,209,513
632,603
19,472
914,719
-
Taxes and assessments receivable, net
-
4,444
-
44,022
-
Accounts receivable - net
-
-
-
-
301,029
Notes and loans receivable
-
494,316
-
-
Contracts receivable
-
-
-
-
-
Due from other
10,390
Due from other fiords
-
-
-
-
Due from other governments
-
-
73,428
238,331
Prepaids
-
-
11,691
11,310
Properties held for sale
-
-
-
-
Other debits
-
-
59
Restricted assets:
Restricted cash and investments
-
-
-
-
-
Total assets
2,209,513
1,131,363
19,472
1,054,309
550,670
IJABELETEES
Liabilities:
Accounts payable
6,404
4,275
-
50,277
5,620
Accrued payroll
990
1,941
-
59,788
22,278
Due to other funds
-
-
-
-
101,993
Advances from other funds
-
-
Other credits
-
-
-
-
Total liabilities
7,394
6,216
-
110,065
129.881
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
-
-
-
-
297,425
Unavailable revenue - deferred taxes and assessments
-
4,444
-
44,022
-
Total deferred inflows o£resources
-
4,444
-
44,022
297,425
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
-
-
-
11,691
11,310
Restricted
General Government
-
-
-
Public Safety
-
112,054
Public Works
-
-
-
-
Culture and Recreation
-
-
19,472
888,531
-
Community Development
2,202,119
1.120,703
-
-
-
Debt Service
-
-
-
unrestricted fund balance:
Unassigned
-
-
-
-
Total fund balance
2,202,119
1.120,703
19,472
900,M
123,364
Total liabilities and fund balance
2,209,513
1,131,363
19,472
1,054,309
550.670
See independent auditor's report.
101
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
Old School Tech Old School Building
TIF Industrial TIF Rail Park TEDD Health Lm, Department
ASSETS
Cash and investments
42,865
3,838
562
44,583
7,025.045
Taxes and assessments receivable, net
32,211
45,407
-
44,327
-
Accounts receivable - net
-
-
-
-
Notes and loans receivable
-
-
Contracts receivable
-
-
Due from other
Due from other fiords
-
-
-
Due from other governments
854
-
77,057
-
Prepards
-
-
-
4,803
Properties held for sale
-
-
Other debits
-
Reshicted assets:
Restricted cash and investments
-
-
-
-
-
Total assets
75,930
49,245
562
166,472
2,029,948
LIABILITIES
Liabilities:
Accounts payable
-
-
-
-
12,236
Accrued payroll
-
21,196
Due to other funds
-
-
Advances from other funds
-
-
Other credits
-
-
Total liabilities
-
33,432
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
-
-
-
-
-
Unavailable revenue - defrared taxes and assessments
32,211
45,407
-
44,827
-
Total deferred inflows a£resources
32,211
45,407
-
44,827
-
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
-
-
-
-
4,803
Restricted
General Government
-
-
121,645
-
Public Safety
-
-
-
1,991,613
Public works
-
-
-
Cuhure and Recreation
-
-
-
Community Development
43,719
3,838
562
Debt Service
-
-
-
unrestricted fund balance:
Unassigned
-
-
-
-
-
Total fund balance
43,719
3,838
562
121,645
1,996,416
Total liabilities and fund balance
75,930
49,245
562
166,472
2,029,848
See independent auditor's report.
102
ASSETS
Cash and investments
Taxes and assessments receivable, net
Accounts receivable - net
Notes and loans receivable
Contracts receivable
Due from other
Due from other fiords
Due from other governments
prepaids
Properties held for sale
Other debits
Restricted assets:
Restricted cash and investments
Total assets
LLIBILFFIES
Liabilities:
Accounts payable
Accrued payroll
Due to other funds
Advances from other funds
Other credits
Total liabilities
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
Unavailable revenue - deferred taxes and assessments
Total deferred inflows a£resources
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
Restricted
General Government
Public Safety
Public works
Culture and Recreation
Community Development
Debt Service
Unrestricted fund balance:
Unassigned
Total fund balance
Total liabilities and fund balance
See independent auditor's report.
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
Public Safety Light Gas Tax -
Impact Fees Maintenance BARS AA Urban Forestry AIACI
5,727 617,681 1,144,850
765,290 21,006
- 21,241 -
23,167
29,503
47,405
1,309,043 - -
110,359
1,314,770 668,425 1,144,850
946,221 21,006
14,279 11,108 29,945
3275 - 7,234
17,554 11,108 37,179
- 21,241 23,167
- 21,241 23,167
1,314,770 - - -
- 629,631) 1,133,742 - 21,006
- - - 885.875 -
1,314.770 629,630 1,133,742 885.875 21,06
1,314.770 668,425 1,144,850 946,221 21,06
103
ASSETS
Cash and investments
Taxes and assessments receivable, net
Accounts receivable - net
Notes and loans receivable
Contracts receivable
Due from other
Due from other fiords
Due from other governments
Prepaids
properties held for sale
Other debits
Restricted assets:
Restricted cash and investments
Total assets
LLIBILMES
Liabilities:
Accounts payable
Accrued payroll
Due to other funds
Advances from other funds
Other credits
Total liabilities
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
Unavailable revenue - deferred taxes and assessments
Total deferred inflows o£resources
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
Restricted
General Government
Public Safety
Public works
Culture and Recreation
Community Development
Debt Service
Unrestricted fund balance:
Unassigned
Total fund balance
Total liabilities and fund balance
See independent auditor's report.
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
Communit{'
Development
RD Revohing Loan Ding
Enforcement Lan- Enforcement
Loan Revahing
CD hIksc.
(2)
Grant
Grants
574.284
373,351
511,729
14,505
18,522
1,670.530
-
328,335
-
296,312
-
12,907
4,938
799,253
7,244.814
1,468,916
840,064
27,412
23,460
125
1,000
-
-
8,311
-
-
3,978
913
1,300,DD0
-
125
1,301,DD0
3,978
9,224
23,434
14,236
2,244,689
167,916
840,064
-
2,244,689
167,916
840,064
7-3,434
14,236
2,244,814
1,468,916
840,064
27,412
23,460
104
ASSETS
Cash and investments
Taxes and assessments receivable, net
Accounts receivable - net
Notes and loans receivable
Contracts receivable
Due from other
Due from other fiords
Due from other governments
Prepaids
Properties held for sale
Other debits
Restricted assets:
Restricted cash and investments
Total assets
LLIBILMES
Liabilities:
Accounts payable
Accrued payroll
Due to other funds
Advances from other funds
Other credits
Total liabilities
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
Unavailable revenue - deferred taxes and assessments
Total deferred inflows a£resources
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
Restricted
General Government
Public Safety
Public works
Culture and Recreation
Community Development
Debt Service
Unrestricted fund balance:
Unassigned
Total fund balance
Total liabilities and fund balance
See independent auditor's report.
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
EPA Bronmfields Bronnfields HAZI%IAT Total Special
Giant Loan Revoh-ing Fire Giants Grant Revenue Funds
90,584 24,933 43,917 10,099,594
- - - 215,319
301,029
- 2,493,181
- - 296,312
10,390
- 9,916 - 9,916
80,613 - 1,189 570,962
- - 27,804
- 799,253
- 59
- - - 1,419,402
80,613 100,50D 24,933 45,106 16,243,211
70,872 40 214,562
- - 121,593
9,916 - 116,566
- - 1,300,000
80,788 40 1,752,721
- - 297,425
- - 215,319
- - 512,744
27,804
- - - 121,645
- 24,933 45,066 3,526,106
- - - 1,794,378
- 1,793,878
100,50D - 6,724,110
(175) - - - -
(175) 100,500 24,933 45,066 13,977,921
80,613 100,500 24,933 45,106 16,243,383
105
ASSETS
Cash and investments
Taxes and assessments receivable, net
Accounts receivable - net
Notes and loans receivable
Contracts receivable
Due from other
Due from other fiords
Due from other governments
Prepaids
properties held for sale
Other debits
Restricted assets:
Restricted cash and investments
Total assets
LLIBILMES
Liabilities:
Accounts payable
Accrued payroll
Due to other funds
Advances from other funds
Other credits
Total liabilities
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
Unavailable revenue - deferred taxes and assessments
Total deferred inflows a£resources
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
Restricted
General Government
Public Safety
Public Works
Culture and Recreation
Community Development
Debt Service
Unrestricted fund balance:
Unassigned
Total fund balance
Total liabilities and fund balance
See independent auditor's report.
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
City Hall Debt Airport TTF Westside TTF
G.O. Bonds Service Debt Sen-ire Debt Sen-ice SID Revolving
169
15,878 3
295,521
62,768
23,409
- 61,358
20,490
-
-
-
-
329
36,715
57,274
45,237
-
-
- -
480.011
158,100
60,293
15,878 118,635
841,259
221,197
23,409 61,358 20,490
23,409 61,358 20,490
36,894
15,878
57,277
820,769
7-21,197
36,894
15,878
57,277
820.769
721,197
60,293
15,878
118,635
941.259
721,197
106
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Balance Sheet
June 30. 2020
Total lonmajor
Total Debt Governmental
S & C's SID 344 SID 345 Sen-ire Funds Funds
ASSETS
Cash and investments
-
7,230
12,659
394,228
$ 10,493,812
Taxes and assessments receivable, net
44,372
1,641,953
139,740
1,931,322
2,146,641
Accounts receivable - net
-
-
-
-
301,029
Notes and loans receivable
2,493,181
Contracts receivable
296,312
Due from other
-
10,390
Due from other fiords
-
-
-
329
10,245
Due from other governments
754
4,891
872
145,743
716,705
Prepards
-
-
-
-
27,804
Properties held for sale
799,253
Other debits
-
-
59
Restricted assets:
Restricted cash and investments
-
-
11,172
649,283
2,068,685
Total assets
45,126
1,654,074
164,443
3,120,905
$ 19,364,116
LLIBIL=S
Liabilities:
Accounts payable
-
-
-
-
214,562
Accrued payroll
-
-
121,593
Due to other funds
329
329
116,895
Advances from other funds
-
-
1,300,000
Other credits
-
-
Total liabilities
329
329
$ 1,753,050
Deferred inflows of resources
Unavailable revenue - deferred accounts receivable
-
-
-
-
297,425
Unavailable revenue - deferred taxes and assessments
44,372
1,641,953
139,740
1,931,322
2,146,641
Total deferred inflows a£resources
44,372
1,641,953
139,740
1,931,322
2,444,066
FUND BALANCES
Nonspendable - not in spendable form
Prepaid
-
-
-
-
27,804
Restricted
General Government
121,645
Public Safety
3,526,106
Public Works
1,794,378
Culture and Recreation
1,793,878
Community Development
-
-
-
-
6,724,110
Debt Service
425
12,121
24,703
1,189,254
1,189,254
Unrestricted fund balance:
Unassigned
-
-
-
-
# (175)
Total fund balance
425
12,121
24,703
1,189,254
$ 15,167,000
Total liabilities and fund balance
45,126
1.654,074
164,443
3,120,905
$ 19.364,116
See independent auditor's report.
107
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
W
Old School Iech
REVF24UES
Airport TIF
Westside TIF
Parks - in - Lieu
Parks
Ambulance
TIF
Taxes and assessments
639,540
-
-
1,141,605
-
57,916
Licenses and permits
-
-
-
-
-
-
Intergovermental
42,671
1,908,279
-
-
274,903
3,057
Charges for services
-
5,408
18,914
411,760
833,900
-
Miscellaneous
-
12,644
-
12,686
-
-
Investment earnings
30,750
2,641
283
9,106
-
280
Total revenues
712,961
1,9M972
19,197
1,575,157
1,108,803
61,253
EXPENDETURES
Public safety
-
-
-
-
1,127,203
-
Public works
-
-
-
-
-
Pairs and recreation
-
-
-
1,494,585
-
-
Community Development
1,119,039
537,365
-
-
-
18,935
Debt service - principal
-
-
-
48,511
-
-
DdX service - interest
-
-
-
5,678
-
-
Capital outlay
-
290,375
18,392
45,844
-
-
Total expendihnes
1,119,039
827,740
18,392
1,594,618
1,127,203
18,935
Excess (deficiency) of revenues over expenditures
(406,078)
1,101,232
805
(19,461)
(1$400)
42,318
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfers in
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
TotaI other financing sources and uses
-
-
-
-
-
-
Net change in fund balance
(406,078)
1,101,232
805
(19.461)
(18.400)
42,35
Fund balances - beginning
2608,197
19,471
18,667
919,683
141,764
1,401
Fundbalances- ending
2,202,119
1,120,703
19,472
900,222
123,364
43,719
See independent auditoes report-
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
REVENUES
Taxes and assessments
Licenses and pernuts
Intergovernmental
Charges for services
Miscellaneous
Investment earnings
Total revenues
EXPENDEMRES
Public safety
Public works
Packs and recreation
Community Development
Debt service - princrpal
Debt service - interest
Caprtal outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Issuance of deht
Transfers in
Transfers (out)
Total other financang sources and uses
Net change in fund balance
Fund balances - beginning
Fund balances - ending
See independent auditor's report.
Old School
Building
Public Safety
Light
Indushial TTF Rail Park TEDD
Health Levy
Department
Impact Fees
Maintenance
3,129 -
901,091
-
-
414,778
- -
-
786,552
-
-
- -
23,860
-
-
-
- -
-
192,116
188,921
-
- -
-
-
29,737
21 8
-
25,507
16,696
7,194
3,150 8
924,951
1,004,175
205,617
451,709
- -
-
878,337
10,000
-
- -
-
-
-
317,452
- -
-
810
-
-
- - - 879,147 10,000 312,452
3,150 8 924,951 125,028 195,617 139,257
- - (925,000) - - -
- - (925,000) - - -
3,150 8 (49) 125,028 195,617 139,257
688 554 121,694 1,871,388 1,119,153 490,373
3,838 562 121,645 1,996,416 1,314,770 629,630
109
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
Community
Gas Tax -
Development
RD Revohing
REVENUES
BARS AA
Urban Forestry
117ACI Laan Revohzng
CD A isc.
Loan (2)
Taxes and assessments
22 282
600,822
- -
-
-
Licenses and permits
-
-
- -
-
-
Intergovernmental
835,851
750
- -
-
-
Charges for senores
40,323
18.210
- 49,462
5,375
4.440
Miscellaneous
-
6,563
- -
-
-
Investment eammgs
13,585
10.062
- 8,819
4,699
3.069
Total revenues
912,041
636,407
- 58,281
10.074
7.509
EXPENDITURES
Public safety
-
-
- -
-
-
Pubhc works
792,287
-
- -
-
-
Padm aad recreation
-
446,416
- -
-
-
Community Development
-
-
- 2.105
58,698
878
Debt service - principal
-
16,859
- -
-
27.210
Debt service - interest
-
1,353
- -
-
4.890
Capital outlay
105,753
-
- -
-
-
Total expen&nres
898,040
464,628
- 2.105
58,698
32.978
Excess(deficiency) of revenues over expenditures
14.001
171,779
- 56,176
(43,624)
(25,469)
OTHER FINANCING SOURCES (USES)
L,cunnce of debt
-
-
- -
-
-
Transfers in
-
-
- -
-
-
Transfers (out)
-
-
- -
-
-
TotaI other financang sources and uses
-
-
- -
-
-
Net change in fund balance
14.001
171,779
- 56,176
(48.624)
(25,469)
Fund balances - beginning
1,119,741
714,096
21.006 2,188,513
216,540
865,533
Fund balances - ending
1,133,742
885,875
21.006 7,244,689
167,916
840,064
See independent auditors report.
110
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
REVENUES
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Miscellaneous
Investment earnings
Total revenues
=NDITURES
Public safety
Public works
Parks and recreation
Community Development
Debt service-prmcrpal
Debt service - interest
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in find balance
Fund balances - begrmmg
Fund balances - endmg
See independent auditor's report.
Law
Stonegarden Drug Enforcement Enforcement EPA Brownfields Brownfields Loan
Grant Grant Giants Grant Recoh-ing
7,169 96,084 42,403 110,108 929
- - 11,995 - -
8,311
7,169 96,084 62,709 110,108 929
7,169 89,988 48,473
110,403 929
7,169 89,988 48,473 110,403 929
- 6,096 14,236 (295) -
6,096 14,236 (295)
17,338 120 100,500
2-3,434 14,236 (175) 100,500
ill
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
REVENUES
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Miscellaneous
Investment earnings
Total revenues
EXPENDErURES
Public safety
Public works
Packs and recreation
Community Development
Debt service - principal
Debt service - interest
Capital c-day
Total expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in fund balance
Fund balances - beginning
Fund balances - ending
See independent auditors report.
Total Special City Hall Debt Airport TIF Debt
Fire Grants HAZALAT Grant Revenue Funds G.D. Bonds Service Senice
- - 3,781,163 513,465 - 29.177
- - 786,552 - - -
- 5,311 3,351,375 - 90.000 -
- - 1,780,924 - - -
20,530 - 90.471 - - -
- 636 133,356 2,606 - 3.229
20,530 5,947 9,923,741 516,071 90.000 32,406
1,600 6,252 2,169,022
-
-
-
- - 1,104,739
-
-
-
--
- - 1,848,352
-
-
-
- - 92.580
485,000
84.065
175,000
- - 11.921
19,150
3.538
8.050
- - 461,174
-
-
-
1,6w 6.252 7,628,789
504,150
87,603
183,050
18,930 (305) 2,294,952
11,921
2,397
(150,644)
- - (925,000
- - (925,000) - - -
18,930 (305) 1,369,952 11,921 2,397 (150,644)
6.003 45,371 12,607,794 24,963 13.481 207,921
24.933 45,066 13,977,746 36.884 15,878 57;M
112
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
■'Vestside TIF
Total Debt Service
REVENUES
Debt Sen-ice
SID Revohing
S & CIS
SID 344
SID 345
Fonds
Taxes and assessments
452,865
-
9,823
230 957
22,480
1,258,767
Licenses and permits
-
-
-
-
-
-
Intergovermcntal
243,128
-
-
-
-
333,128
Charges for services
9,089
-
-
-
-
9,089
Miscellaneous
-
-
-
-
-
-
Investment earrungs
-
4,201
-
-
-
10,036
Total revenues
705,082
4,201
9,823
230,957
22,480
1,611,020
EXPEN77FFURES
Public safety
-
-
-
-
-
-
Pubhc works
-
-
-
-
-
-
Padcs aad recreation
-
-
-
-
-
-
Commundy Development
-
-
-
106,791
-
106,791
Debt service - principal
19 AO
-
8,198
225,000
14,000
1,181,263
Debt service - interest
175,325
-
1,631
80,903
4,770
293,372
Capital outlay
-
-
-
-
-
-
Total expendihnes
365,325
-
9,829
412,699
18,770
1,581,426
Excess(deficiency) of revenues overexprnddures
339,757
4,201
(6)
(181,742)
3,710
29,594
OTHER FINANCING SOURCES (USES)
Ismaince of debt
-
-
-
-
-
-
Trans&rs in
-
-
-
80,000
-
80,000
Transfers (out)
-
(80.000)
-
-
-
(80.000)
Total other financang sources and uses
-
(80.000)
-
80,000
-
-
Net change in fund balance
339,757
(75.799)
(6)
(101,742)
3,710
29,594
Fund balances - beginning
481,012
296,996
431
113,863
20,993
1,159,660
Fundbalances- ending
820,769
221,197
425
12,121
24,703
1,189,254
See independent auditor's report.
113
City of Kalispell, Montana
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended June 30, 2020
REVENUES
Taxes and assessments
Licenses and permits
IIY-gOv---l
Charges for services
Nliscellaneous
Inveswrentearnings
Total revenues
EIXPENDITITRE S
Public safety
Public works
Parks and recreation
Comnnrnity Development
Debt service-pnncrpal
Debt service - interest
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in find balance
Fund balances - begtnn�nn
Fund balances - ending
See independent auditor's report.
Total Nonmajor
S & C Total Capital Governmental
Construction Project Funds Funds
5,039.930
786,552
3,684.503
1,789,913
90,471
143,392
11,534,761
2,169,022
1,104.739
1,941,001
1,955.143
1273.943
- - 305,293
15,824 15,824 476,998
15,824 15,824 9,226.039
(15.824) (15.824) 7,308.722
15,824 15,824 15,824
- - 80,000
- - (1,005.000)
15,824 15,824 (909,176)
- - 1,399.546
13.767.454
15,167.000
114
11LINION
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Airport TIF
Westside TIF
Positive 1
Positive 1
( esativel
( eeativel
Budget
Actual
Valiance
Budget
Actual
Valiance
REVENUES
Taxes and assessments
688,369
639,540
(48,829)
-
-
Licenses and permits
-
-
-
-
-
Intergovernmental
42,672
42,671
(1)
1,700.000
1,908,279
208,279
Charges for services
-
-
-
-
5,408
5,408
Miscellaneous
-
-
-
75,000
12,644
(62,356)
Investment earnings
20.000
30,750
10,750
1.000
2,641
1,641
Total revenues
751.041
712,961
(38,080)
1,776,000
1,928,972
152,972
EXPENDITURES
Current:
Public safety -
-
-
-
-
-
Public works -
-
-
-
-
-
Parks and recreation -
-
-
-
-
-
Comu n,ityDevelopment 3,359,237
1,119,039
2,240,198
1,567,016
537,365
1,029,651
Debt service - principal -
-
-
-
-
-
Debt service - interest -
-
-
-
-
-
Capital outlay -
-
-
228,455
290,375
(61,920)
Total expenditures 3,359,237
1,119,039
2,2.40,198
1,795,471
827,740
967,731
Excess (deficiency) of revenues over expenditure (2,608,196}
(406,078}
2,202,118
(19,471)
1,101,232
1,120,703
OTHER FINANCING SOURCES (USES)
Issuance of debt -
-
-
-
-
-
Transfers in -
-
-
-
-
-
Transfers (out) -
-
-
-
-
-
Total other financing sources and uses -
-
-
-
-
-
Net change in fund balance (2,608,196}
(406,078)
2,202,118
(19,471)
1,101,232
1,120,703
Fund balances - beginning
2,608,197
19,471
Fund balances - ending
2,2.02,119
1,120,703
See independent auditor's report.
115
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Parks in Lieu
Parks
Positive 1
Positive 1
( eeativel
CNeaativel
Budget Actual
Valiance
Budget
Actnal
Variance
REVENUES
Taxes and assessments
- -
-
1,182,000
1,141,605
(40,395)
Licenses and permits
- -
-
-
-
-
Intergovernmental
- -
-
-
-
-
Charges for services
- 18,914
18,914
539,434
411,760
(127,674)
Miscellaneous
- -
-
20,000
12,686
(7,314)
Investment earnings
- 283
283
5,500
9,106
3,606
Total revenues
- 19,197
19,197
1,746,934
1,575,157
(171,777)
EXPENDITURES
Current:
Public safety -
-
- -
-
-
Public works -
-
- -
-
-
Parks and recreation -
-
- 1,712,191
1,494,585
217,606
Community Development -
-
- -
-
-
Debt service -principal -
-
- 59,296
48,511
10,785
Debt service - interest -
-
- 7,890
5,678
2,212
Capital outlay 18,392
18,392
- 54,608
45,844
8,764
Total expenditures 18,392
18,392
- 1,833,985
1,594,618
239,367
Excess (deficiency) of revenues over expenditure {18,392)
805
19,197 (87,051)
(19,461)
67,590
OTHER FINANCING SOURCES (USES)
Issuance of debt -
-
-
-
Transfersin -
-
-
-
-
Transfers (out) -
-
- -
-
-
Total other financing sources and uses -
-
- -
-
Net change in fund balance (18,392)
805
19,197 (87,051)
(19,461)
67,590
Fund balances - bea nninn4
18,667
919,683
Fund balances - ending
19,472
900,222
See independent auditor's report.
116
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Ambulance Old School Tech TIF
Positive 1
Positive 1
( eeativel
C\ egativel
Budget
Artual
Variance
Budget
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
60,025
57,916
(2,109)
Licenses and permits
-
-
-
-
-
-
Intergovernmental
400,000
274,903
(125,097)
3,056
3,057
1
Charges for services
719,000
833,900
114,900
-
-
-
Miscellaneous
-
-
-
-
-
-
Investment earnings
-
-
-
100
280
180
Total revenues
1,119,000
1,108,803
(10,197)
63,181
61,253
(1,928)
EXPENDITURES
Current:
Public safety
1,187,780
1,127,203
60,577
-
-
-
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
18,900
18,935
(35)
Debt service - principal
19,000
-
19,000
-
-
-
Debt service - interest
3,202
-
3,202
-
-
-
Capital outlay
190,000
-
190,000
-
-
-
Total expenditures
1,399,982
1,127,203
272,779
18,900
18,935
(35)
Excess (deficiency) of revenues over expenditure
(280,982)
(18,400)
262,582
44,281
42,318
(1,963)
OTHER FINANCING SOURCES (USES)
Issuance of debt
190,000
-
(190,000)
-
-
-
Transfersin
-
-
-
-
-
-
Transfers (out)
-
-
-
(45,000)
-
45,000
Total other financing sources and uses
190,000
-
(190,000)
(45,000)
-
45,000
Net change in fund balance
(40,982)
(18,400)
72,582
(719)
42,318
43,037
Fund balances - bea nninn4
141,764
1,401
Fund balances - ending
123,364
43,719
See independent auditor's report
117
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Old School Industrial TIF
Rail Park TEDD
Positive 1
Positive 1
CNeeativel
(11 eeativel
Bndget
Actual
Variance
Budget Actual Variance
REVENUES
Taxes and assessments
4,288
3,129
(1,159)
- - -
licenses and permits
-
-
-
- -
intergovernmental
-
-
-
- - -
Charges for services
-
-
-
- - -
Miscellaneous
-
-
-
- - -
Investment earnings
25
21
(4)
8 8 -
Total revenues
4,313
3,150
(1,163)
8 8 -
EXPENDITURES
Current:
Public safety
-
-
-
- - -
Public works
-
-
-
- - -
Parks and recreation
-
-
-
- - -
Community Development
-
-
-
- - -
Debt service - principal
-
-
-
- - -
Debt service -interest
-
-
-
- - -
Capital outlay
-
-
-
- - -
Total expenditures
-
-
-
- - -
Excess (deficiency) of revenues over expenditure
4,313
3,150
{1,163)
8 8 -
OTHER FINAIti CIlti G SOURCES (USES)
Issuance of debt
-
-
- -
Transfers in
-
-
- -
Transfers (out)
(5,000)
-
5,000
- - -
Total other financing sources and uses
(5,000)
-
5,000
- -
Net change in fund balance
(687)
3,150
3,837
8 8 -
Fund balances - beginning
688
554
Fund balances - ending
3,838
562
See independent auditor's report.
118
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Health Le«
Building Department
Positive 1
Positive 1
fN eeativel
(Neaativel
Budget
Actual
Variance
Budget
Actual
Variance
REVENUES
Taxes and assessments
906,000
901,091
(4,909)
-
-
-
Licenses and permits
-
-
-
530,000
786,552
256,552
Intergovernmental
22,025
23,860
1,835
-
-
-
Charges for services
-
-
-
160,000
192,116
32,116
Miscellaneous
-
-
-
-
-
-
Investment earnings
-
-
-
18.000
25,507
7,507
Total revenues
928,025
924,951
(3,074)
708.000
1,004,175
296,175
EXPENDITURES
Current:
Public safety - -
- 920,843
878,337 42,506
Public works - -
- -
- -
Parks and recreation - -
- -
- -
Community Development - -
- -
- -
Debt service - principal - -
- -
-
Debt service - interest - -
- -
- -
Capital outlay - -
- 35,000
810 34.190
Total expenditures - -
- 955,843
879,147 76.696
Excess (deficiency) of revenues over expenditure928,025 924,951
{3,074) (247,843)
125,028 372.871
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in fund balance
Fund balances - bea nninn4
Fund balances - ending
See independent auditor's report.
(925,000) (925,000) - -
(925,000) (925,000) - -
3,025 (49) {3,074} {247,843)
121,694
121,645
125,028 372,871
1,871,388
1,996,416
119
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Impact Fees
Light Maintenance
Positive 1
Pasiti►-e 1
CNeaati►-el
(_Neaative)
Budget
Actual
Variance
Budget
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
410,700
414,778
4,078
Licenses and permits
-
-
-
-
-
-
Intergovernmental
-
-
-
-
-
-
Charges for services
160,000
188,921
28,921
-
-
-
Miscellaneous
-
-
-
5.000
29,737
24,737
Investment earnings
13,000
16,696
3,696
3.000
7,194
4,194
Total revenues
173,000
205,617
32,617
41&700
451,709
33,009
EXPENDITURES
Current:
Public safety
10,000
10,000
-
-
-
-
Public works
-
-
-
403,658
312,452
91,206
Parks and recreation
-
-
-
-
-
-
Comm miry Development
-
-
-
-
-
-
Debt service - principal
-
-
-
-
-
-
Debt service - interest
-
-
-
-
-
-
Capital outlay
850,000
-
850,000
-
-
-
Total expenditures
860,000
10,000
850,000
403,658
312,452
91,206
Excess (deficiency) of revenues over expenditure
(687,000)
195,617
882,617
15,042
139,257
124,215
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfers in
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
-
-
-
Net change in fund balance
{687.000)
195,617
882,617
15,042
139,257
124,215
Fund balances - beg nninnn
1,119,153
490,373
Fund balances - ending
1,314,770
629,630
See independent auditor's report.
120
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Gas Tax - BARSAA
Urban Forestry
Positive 1
Positive 1
( esativel
(Neaativel
Budget
Actual
Valiance
Budget
Actual
Variance
REVENUES
Taxes and assessments
20,000
22,282
2,282
592,500
600,822
8,322
Licenses and permits
-
-
-
-
-
-
Intergovervmental
790,204
835,851
45,647
750
750
-
Charges for services
40,000
40,323
323
-
18,210
18,210
Miscellaneous
-
-
-
3,200
6,563
3,363
Investment earnings
8.000
13,585
5,585
3.000
10,062
7,062
Total revenues
858.204
912,041
53,837
599.450
636,407
36,957
EXPENDITURES
Current:
Public safety
Public works
1,032,238
792,287
239,951
-
-
-
Parks and recreation
-
-
-
744,223
446,416
297,807
Community Development
-
-
-
-
-
-
Debt service - principal
-
-
-
16,530
16,859
(329)
Debt service - interest
-
-
-
1,920
1,353
567
Capital outlay
141,365
105,753
35,612
20,000
-
20,000
Total expenditures
1,173,603
898,040
275,563
782,673
464,628
318,045
Excess (deficiency) of revenues over expenditure
(315,399)
14,001
329,400
(183,223)
171,779
355,002
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfersin
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
-
-
Net change in fond balance
(315,399)
14,001
329,400
(183,223)
171,779
355,002
Fund balances - bea nninn4
1,119,741
714,096
Fund balances - ending
1,133,742
885,875
See independent auditor's report.
121
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Community Development Loan
ALkCI
Revolving
Positive 1
POsAdVe 1
tT esativel
f_Neaativel
Budget Artual
Valiance
Budget
Actual
Variance
REVENUES
Taxes and assessments
- -
-
-
-
-
Licenses and permits
- -
-
-
-
-
Intergovernmental
176,786 -
(176,786)
-
-
-
Charges for services
10,000 -
(10,000)
50,621
49,462
(1,159)
Miscellaneous
- -
-
-
-
-
Investment earnings
- -
-
4,300
8,819
4,519
Total revenues
186.786 -
(186,786)
54,921
58,281
3,360
EXPENDITURES
Current:
Public safety
Public works
Parks and recreation
Community Development -
- -
417,000
2,105
414,895
Debt service - principal -
- -
-
-
-
Debt service - interest -
- -
-
-
-
Capital outlay 419,406
- 419,406
-
-
-
Total expenditures 419,406
- 419,406
417,000
2,105
414,895
Excess (deficiency) of revenues over expenditure {232,62D)
- 232,62fl
(362,079)
56,176
418,255
OTHER FINANCING SOURCES (USES)
Issuance of debt -
- -
-
-
-
Transfersin -
- -
-
-
-
Transfers (out) -
- -
-
-
-
Total other financing sources and uses -
- -
-
-
-
Net change in fund balance (232,620)
- 232,620
(362,079)
56,176
418,255
Fund balances - bea nninn4
21,O06
2,188,513
Fund balances - ending
21,006
2,244,689
See independent auditor's report.
122
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
CD _Misr.
RD Revolving Loan (2)
Positive 1
Positive 1
(1ti eeativel
(Negativel
Budget Artual
Variance
Budget
Actual Variance
REVENUES
Taxes and assessments
- -
-
-
- -
Licenses and permits
- -
-
-
- -
Intergovernmental
- -
-
-
- -
Charges for services
- 5,375
5,375
34,397
4,440 (29,957)
Miscellaneous
- -
-
-
- -
Investment earnings
3,000 4,699
1,699
2,000
3,069 1,069
Total revenues
3,000 10,074
7,074
36,397
7,509 (28,888)
EXPENDITURES
Current:
Public safety
-
- -
-
-
-
Public works
-
- -
-
-
-
Parks and recreation
-
- -
-
-
-
Community Development
192,484
58,698 133,786
550,000
878
549,122
Debt service - principal
-
- -
26,941
27,210
(269)
Debt service - interest
48,750
- 48,750
5,158
4,890
268
Capital outlay
-
- -
-
-
Total expenditures
241,234
58,698 182,536
582,099
32,978
549,121
Excess {deficiency} of revenues over expenditure
{21 ,234)
(48,624) 189,610
(545,702)
(25,469)
520,233
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in fund balance
Fund balances - bea nninn4
Fund balances - ending
See independent auditor's report.
65,000 - (65,000) -
65,000 - (65,000) -
(173,2.34) (48,624) 124,610 (545,702)
216,540
167,916
(25,469) 520,233
865,533
840,064
123
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Stonegarden Grant
Drug Enforcement Grant
Positive 1
Positive 1
( egativel
(Negativel
Budget
Artual
Valiance
Budget
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
-
-
-
Licenses and permits
-
-
-
-
-
-
Intergovernmental
10,000
7,169
(2,831)
95,000
96,084
1,084
Charges for services
-
-
-
-
-
-
Miscellaneous
-
-
-
-
-
-
investment earnings
-
-
-
-
-
-
Total revenues
10.000
7,169
(2,831)
95,000
96,094
1,084
EXPENDITURES
Current:
Public safety
120.000
7,169
112,831
98,978
89,988
8,990
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
-
-
-
Debt service - principal
-
-
-
-
-
-
Debt service - interest
-
-
-
-
-
-
Capital outlay
-
-
-
-
-
Total expenditures
120,000
7,169
112,831
98,978
89,988
8,990
Excess (deficiency) of revenues over expenditure
(110,000)
-
110,000
(3,978)
6,096
10,074
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfersin
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
-
-
Net change in fund balance
(110,000)
-
110,000
(3,978)
6,096
10,074
Fund balances - bea nninn4
-
17,338
Fund balances - ending
-
23,434
See independent auditor's report.
124
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
La►► Enforcement Grants
EPA Bro►i-niields Grant
Positive 1
Positive 1
(Neazati►-el
(Neaati►-el
Budget
Actual
Variance
Budoet
Actnal
Variance
REVENUES
Taxes and assessments
-
-
-
-
-
-
Licenses and permits
-
-
-
-
-
-
Intergovernmental
64,279
42,403
(21,876)
226,481
110,108
(116,373)
Charges for services
17,000
11,995
(5,005)
-
-
-
Miscellaneous
-
8,311
8,311
-
-
-
Investment earnings
_
_
_
_
_
_
Total revenues
81,279
62.709
(18,570)
226.481
110,108
(116,373)
EXPENDITURES
Current:
Public safety
83,000
48,473
34,527
-
-
-
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
368,880
110,403
258,477
Debt service - principal
-
-
-
-
-
-
Debt service - interest
-
-
-
-
-
-
Capital outlay
-
-
-
-
-
-
Total expenditures
83,000
48,473
34,527
368,880
110,403
258,477
Excess (deficiency) of revenues over expenditure
(1,721)
14,236
15,957
(142,399)
(295)
142,104
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfers in
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
-
-
-
Net change in fund balance
(1,721)
14,236
15,957
(142,399)
(295)
142,104
Fund balances - beginni ann
-
120
Fund balances - ending
14,236
(175)
See independent auditor's report
125
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Bro«-utields Loan Revolving
Fire Grants
Positive 1
Positive 1
(1ti esativel
CNeaativel
Budget
Actual
Valiance
Budget
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
-
-
-
Licenses and permits
-
-
-
-
-
Intergovernmental
486,924
929
(485,995)
314,546
-
(314,546)
Charges for services
-
-
-
-
-
-
Miscellaneous
-
-
-
6,000
20,530
14,530
Investment earnings
-
-
-
-
-
Total revenues
486.924
929
(485,995)
320,546
20,530
(300,016)
EXPENDITURES
Current:
Public safety
-
-
-
5,000
1,600
3A00
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
587,424
929
586,495
-
-
-
Debt service - principal
-
-
-
-
-
-
Debt service - interest
-
-
-
-
-
-
Capital outlay
-
-
-
224,546
-
224,546
Total expenditures
587,424
929
586,495
229,546
1,600
227,946
Excess (deficiency) of revenues over expenditure
(100,500)
-
100,500
91,000
18,930
(72,070)
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfers in
-
-
-
31,454
-
(31,454)
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
31,454
-
(31,454)
Net change in fund balance
(100,500)
-
100,500
122,454
18,930 {103,524)
Fund balances - bea nninn4
100,500
6,003
Fund balances - ending
100,500
24,933
See independent auditor's report
126
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
HA7.MAT Grant
Total Special Revenue Funds
Positive 1
Positive 1
(1ti eeativel
(Neuativel
Bn
Actual
Variance
Budget
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
3,863,882
3,781,163
(82,719)
Licenses and permits
-
-
-
530,000
786,552
256,552
Intergovernmental
6,000
5,311
(689)
4,338,723
3,351,375
(987,348)
Charges for services
-
-
-
1,730,452
1,780,824
50,372
Miscellaneous
-
-
-
109,2D0
90,471
(18,729)
Investment earnings
-
636
636
80,933
133,356
52,423
Total revenues
6,000
5,947
(53)
10,653,190
9,923,741
(729,449)
EXPENDITURES
Current:
Public safety
25,000
6,252
18,748
2,450,601
2,169,022
281,579
Public works
-
-
-
1,435,896
1,104,739
331,157
Parks and recreation
-
-
-
2,456,414
1,941,001
515,413
Community Development
-
-
-
7,060,941
1,848,352
5,212,589
Debt service -principal
-
-
-
121,767
92,580
29,187
Debt service - interest
-
-
-
66,920
11,921
54,999
Capital outlay
-
-
-
2,181,772
461,174
1,720,598
Total expenditures
25,000
6,252
18,748
15,774,311
7,628,789
8,145,522
Excess (deficiency) of revenues over expenditure
(19,000)
(3D5)
18,695
(5,121,121)
2,294,952
(8,874,971)
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
190,000
-
190,000
Transfers in
-
-
-
96,454
-
(96,454)
Transfers (out)
-
-
-
(975,000)
(925,000)
(50,000)
Total other financing sources and uses
-
-
-
(688,546)
(925,000)
43,546
Net change in fund balance
(19,000)
(305)
18,695
(5,809,667)
1,369,952 {8,831,425)
Fund balances - bea nninn4
45,371
12,607,794
Fund balances - ending
45,066
13,977,746
See independent auditor's report
127
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
G.O. Bonds
Positive 1
( esativel
Buduet Actual Variance
Citv Hall Debt Service
Positive 1
(Nerrativel
Buda et Actual Variance
REVENUES
Taxes and assessments
502,500
513,465
10,965
-
-
-
Licenses and permits
-
-
-
-
-
-
Intergovernmental
-
-
-
90.000
90.000
-
Charges for services
-
-
-
-
-
-
Miscellaneous
-
-
-
-
-
-
Investment earnings
1,500
2,606
1.106
-
-
-
Total revenues
504,000
516,071
12,071
90.000
90.000
-
EXPENDITURES
Current:
Public safety
-
-
-
-
-
-
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
-
-
Debt service -principal
475,000
485,000
(10,000)
83,024
84,065
(1,041)
Debt service - interest
27,463
19,150
8,313
6,587
3,538
3,049
Capital outlay
-
-
-
-
-
-
Total expenditures
502,463
504,150
(1,687)
89,611
87,603
2,008
Excess (deficiency) of revenues over expenditure
1.537
11,921
10,384
389
2,397
2,008
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfersin
-
-
-
-
-
-
Transfers (out)
-
-
-
-
-
-
Total other financing sources and uses
-
-
-
-
-
-
Net change in fund balance
1,537
11,921
10,394
389
2,397
2,008
Fund balances - bea nninn4
24,963
13,481
Fund balances - ending
36,884
15,878
See independent auditor's report.
128
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Airport
TIF Debt Service
Westside TIF Debt Service
Positive 1
Positive 1
( eeativel
(Neuati►-el
Bim
Actual
Variance
Budget
Actual
Variance
REVENUES
Taxes and assessments
22,050
29,177
7,127
455,850
452,865
(2,985)
Licenses and permits
-
-
-
-
-
Intergovervmental
-
-
-
243,128
243,128
Charges for services
-
-
-
8,000
9,089
L089
Miscellaneous
-
-
-
-
-
Investment earnings
2,000
3,229
1,229
-
-
Total revenues
24,050
32,406
8,356
706,978
705,082
(L896)
EXPENDITURES
Current:
Public safety
-
-
-
-
-
-
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
-
-
-
Debt service -principal
165,000
175,000
(10,000)
170,000
190,000
(20,000)
Debt service - interest
15,226
8,050
7,176
196,027
175,325
20,702
Capital outlay
-
-
-
-
Total expenditures
180,226
183,050
(2,824)
366,027
365,325
702
Excess (deficiency) of revenues over expenditure
{156,176)
{150,644)
5,532
340,951
339,757
(1,194)
OTHER FINANCING SOURCES (USES)
Issuance of debt
Transfers in
Transfers (out)
Total other financing sources and uses
Net change in fund balance
Fund balances - bea nninn4
Fund balances - ending
See independent auditor's report.
(600,000) - (600,000) -
(600,000) - (600,000) -
(756,176) (150,644) (594,468} 340,951
207,921
57,277
339,757 {1,194)
481,012
820,769
129
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
SID Revolving
S & C's
Positive 1
Positive 1
( esativel
CNeaativel
Bim
Actual
Valiance
Bnd2et
Actual
Variance
REVENUES
Taxes and assessments
-
-
-
9,915
9,823
(92)
Licenses and permits
-
-
-
-
-
-
Intergovemmental
-
-
-
-
-
-
Charges for services
-
-
-
-
-
-
Miscellaneous
-
-
-
-
-
-
Investment earnings
2,000
4,201
2,201
-
-
-
Total revenues
2,000
4,2.01
2,201
9,915
9,823
(92)
EXPENDITURES
Current:
Public safety
-
-
-
-
-
-
Public works
-
-
-
-
-
-
Parks and recreation
-
-
-
-
-
-
Community Development
-
-
-
-
-
-
Debt service -principal
-
-
-
7,423
8,198
(775)
Debt service - interest
-
-
-
1,393
1,631
(238)
Capital outlay
-
-
-
-
-
-
Total expenditures
-
-
-
8,816
9,829
Excess (deficiency) of revenues over expenditure
2,000
4,201
2,201
1,099
(6)
(1,105)
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfersin
-
-
-
-
-
-
Transfers (out)
-
(80,000)
(80,000)
-
-
Total other financing sources and uses
-
(80,000)
(80,000)
-
-
-
Net change in fund balance
2,000
(75,799) (77,799}
1,099
(6) {1,105}
Fund balances - bea nninn4
296,996
431
Fund balances - ending
221,197
425
See independent auditor's report
130
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
SID 344
SID 345
Positive 1
Positive 1
( eeativel
CNeaativel
Bim
Actual
Valiance
Budget
Actual
Variance
REVENUES
Taxes and assessments
320,000
230,957
(89,043)
20,400
22,480
2,080
Licenses and permits
-
-
-
-
-
-
Intergovemmental
-
-
-
-
-
-
Charges for services
-
-
-
-
-
-
Miscellaneous
-
-
-
-
-
-
Investment earnings
-
-
-
-
-
-
Total revenues
320,000
230,957
(89,043)
20,400
22A80
2.080
EXPENDITURES
Current:
Public safety
-
-
-
-
-
-
Public works
-
-
-
-
-
Parks and recreation
-
-
-
-
-
Community Development
-
106,791
(106,791)
-
-
-
Debt service - principal
15,000
225,000
(210,000)
12,000
14,000
(2.000)
Debt service - interest
763
80,908
(80,145)
5,480
4,770
710
Capital outlay
-
-
-
-
-
-
Total expenditures
15,763
412,699
(396,936)
17,480
18,770
Excess (deficiency) of revenues over expenditure
304 237
{181,742)
(485,979}
2,920
3,710
790
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
-
-
-
-
Transfers in
-
80,000
80,000
-
-
Transfers (out)
-
-
-
-
Total other financing sources and uses
-
80,000
80,000
-
-
-
Net change in fund balance
304,237
(101,742) (405,979}
2,920
3,710
790
Fund balances - bea nninn4
113,863
20,993
Fund balances - ending
12,121
24,703
See independent auditor's report
131
REVENUES
Taxes and assessments
Licenses and permits
Intergovernmental
Charges for services
Miscellaneous
Investment earnings
Total revenues
City of Kalispell, Montana
Budgetary Comparison Schedule
Nonmajor Governmental Funds
For the Year Ended June 30, 2020
Total Debt Senice Funds
Positive 1
(1Neuati►-el
Budget Actual Variance
1,330,715 1,258,767 (71,948)
333,128
333,128 -
8,000
9,089 1,089
5,500
10,036 4,536
1,677,343
1,611,020 (66,323)
S & C Construction
Positive 1
(1N eGativel
Bndeet Actual Variance
EXPENDITURES
Current:
Public safety
-
-
- - - -
Public works
-
-
- - - -
Parks and recreation
-
-
- - - -
Cammunity Developmerut
-
106,791
(106,791) - - -
Debt service - principal
927,447
1,181,263
(253,816) - - -
Debt service -interest
252,939
293,372
(40,433) - - -
Capital outlay
-
-
- 25,000 15,824 9,176
Total expenditures
1,180,386
1,581,426
(401,040) 25,000 15,824 9,176
Excess (deficiency) of revenues over expenditure
496,957
29,594
334,717 (25,000) (15,824) 9,176
OTHER FI NAIti CIlti G SOURCES (USES)
Issuance of debt - - - 25,000 15,824 (9,176)
Transfers in - 80,000 80,000 - - -
T—fers (out) (600,000) (80,000) 520,000 - - -
Total other financing sources and uses (600,000) - 600.000 25,000 15,824 (9,176)
Net change in fund balance (103,043) 29,594 934.717 - - -
Fund balances - beginning 1,159,660
Fundbalauces - ending 1,189,254
See independent auditor's report.
132
COMBINING AND INDIVIDUAL
FUND STATEMENTS
10[0]01► /.11Ii]:14U:�i]UI'A1N M.111"Wa Is) ►1oil
SOLID WASTE — Accounts for assessments received and expenses incurred in the
operation of the City solid waste department.
City of Kalispell, Montana
Statement of Net Positon
Nonmajor Proprietary Funds
June 30, 2020
Solid Waste
ASSETS
Current assets:
Cash and investments
$
1,560,535
Taxes and assessments receivable, net
27,564
Due from. other governments
101,2M
Prepaids
7,386
Other debits
2,746
Total current assets
$
1,fi99,471
Noncurrent assets:
Capital assets (net of accumulated depreciation):
Capital assets - coustruetion in progress
$
-
Depreeiable
361,775
Total noncurrent assets
$
361,775
Total assets
$
2,061,246
DEFERRED OUTFLOWS OF RESOURCES
Pension plan subsequent contributions/changes
$
68,264
Total deferred outflows of resources
$
68,264
LIABILITIES
Current liabilities:
Accounts payable
$
5,824
Accrued payroll
17,270
Compensated absences payable
43,544
Total current liabilities
$
66,638
Noncurrent liabilities:
Compensated absences payable
$
23,662
Net pension liability
380,395
Total noncurrent liabilities
$
404,057
Total liabilities
$
470,695
DEFERRED INFLOWS OF RESOURCES
Pension-diffff between projected and actual earnings
$
58,062
Total deferred inflows of resources
$
58,062
NET POSMON
Net investment in capital assets
$
361,775
Unrestricted
1,238,978
Total net position
$
1,600,753
See independent auditor's report
133
City of Kalispell, Montana
Statement of Revenues, Expenses, and Changes in Fund Net Positioi
Nonmajor Proprietaiy Funds
For the Fiscal Year Ended June 30, 2020
Solid Waste
OPERATING REVENUES
Charges for services
$
1,073,145
Miscellaneous revenues
2,902
Total operating revenues
$
1,076,047
OPERATING EXPENSES
Personal services
$
600,863
Supplies
87,511
Purchased services
84,222
Fixed charges
153,864
Depreciation
120,948
Total operating expenses
$
1,047,408
Operating income {loss)
$
28,639
NONOPERATLNG REVENUES (EXPENSES)
Intergovernmental revenue
$
8,402
Interest revenue
19,289
Debt service interest expense
-
Total non -operating revenues (expenses)
$
27,691
Change in net position
$
56,330
Net Position - beginning of the year
$
1,544,423
Net Position - end of the year
$
1.600.753
See independent auditor's report.
134
City of Kalispell, Montana
Statement of Cash Flaws
Nonmajor Proprietary Funds
For the Year Ended June 30, 2020
Cash flows from operating activities:
Cash received from customers
Cash received from miscellaneous sources
Cash payments for claims
Cash payments to employees
Net cash provided (used) by operating activities
Cash flows from capital and related financing activities:
Principal paid on bonds, loans and advances
Interest paid on bonds, loans and advances
Acquisition and construction of capital assets
Net cash provided (used) by capital and related financing activities
Cash flows from investing activities:
Interest on investments
Net cash provided (used) by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning
Cash and cash equivalents at end
Reconciliation of operating income (loss) to net cash provided
(used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net cash
provided (used) by operating activities:
Depreciation
Changes in assets and liabilities:
Taxes and assessments receivable, net
Due from county
Camp absences
Accounts payable
Prepaid Expenses
Accrued payroll
Pension expens adjustment
Net cash provided (used) by operating activities
See Independent Auditor's Report
Solid Waste
S 1,026262
2,902
(330.886)
(526,276)
S 172,002
S -
(1,599)
S (1,599)
S 19,289
S 19,289
S 189.692
1,370.843
S 1,560.535
S 28,639
120.948
(44,323)
(2,560)
7,031
(11,710)
6,421
1,560
65,996
S 172.002
135
STATISTICAL
SECTION
This part of the City of Kalispell's financial report presents detailed information as a
context for understanding what the information in the financial statements, note
disclosure and required supplementary information says about the government's overall
financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand how the
government's financial performance and well-being have changed over time
Revenue Capacity
These schedules contain information to help the reader assess the government's
most significant local revenue source, the property tax.
Debt Capacity
These schedules present information to help the reader assess the affordability of
the government's current level of outstanding debt and the government's ability to
issue additional debt in the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the government's financial activities
take place.
Operating Information
These schedules contain service and infrastructure data to help the reader
understand how the information in the government's financial report relates to the
services the government provides and the activities it performs.
Additional Information
This category is intended to present other information the City feels is necessary
for its users.
Sources: Unless otherwise noted, the information in these schedules is derived from the City of Kalispell annual
financial report for the relevant year.
Note: The City of Kalispell implemented GASB Statement 34 in fiscal year 2003, therefore the data for prior years are
not shown; schedules presenting government -wide information include information beginning in that year.
IN1►/:0►[a/:ImI*Aa►1OR
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136
=OF KALISPE L MONTANA
CHANGES INNETPOSMON
Past Ten Fiscal Years
Tell
2m
2w
mu
2S113
2211
MR
2aa
22L2
7e79
ErWe es
Govenvnenal
acivities:
General go+remmerd
5510,274
6995,454
6,709,523
5,6MI35
5,401y42
5,823.767
5,841,775
6,251,409
6,M813
6X51773
Pubic Safety
8,729290
8536j32
9293,138
9A9,827
9j75,4S7
9,113,674
10,968,010
11j33,s62
i1,18fi487
11,738977
Pubic Works
3j06,165
2,844,001
3,074,630
2,573,627
2,773,097
2381,002
2,6K 513
3j41,768
5,778,281
4.432,1,52
Parks and recreation
1,845,939
1,913,920
1991'585
2,123,2.37
2,0e,(o
2.057.468
2,184,M
2354,634
2,530,660
2,371,145
Camrrxnity Bevekrprrwrt
2.033.880
1,426j77
3AI6j37
1,61)IJ70
683,164
928,661
853,455
1375,659
2,S60,796
2,048jW
Interest
5 1
3 770
357 SS7
33l it
401
Dt2110
588
381767
333593
Tool govemcnental activities expenses
21,805y09
21,716,OS4
25,075984
21,613,854
20,827,470
20,790,9'73
22,7M,085
2A983,920
28,816804
27,149910
Business -Type activities:
Airport
214,636
217A16
2251W74
rn7751
154,715
154.091
155$M
333,572
-
-
Water
2.W293
2_592,628
2,66Wn
2fi25,046
2j42,119
2,657.816
2,734,979
3,079,040
3,042,213
3,134,112
Sewer
5,8878�
SjW3l9
5j55,654
5,114,591
5,077,643
5304,622
4,955y25
5,482,339
5,812,173
6j41j37
Solid Waste
71&139
749,481
783yfi7
S12,6511
.16,686
880.679
872,16I
1,013,000
994'.
1,047,408
Tool busness4ype activities expenses
4 04.936
9.123
2 472
8730038
8.991163
97208
71 i
9 7951
9849A46
1 057
Tool primary government expenses
Program Revenues
Govenxnental activities:
Charges for services:
General government
1,039j53
8652,23
60,464
WA729
691350
892,578
789,167
909J58
810930
797202
Public Safety
IN78,825
1,753969
1928,011
2,033,870
1,9 $98
2.219.795
3.155.476
2,816,588
ZM838
3.006,814
Public Works
25125M
2226,027
2j01,616
2,172,122
2,463,435
2§72,473
2,S85,492
3,15%932
3,470,887
3�M,603
Parks and recreation
M868
619,634
711,969
752,460
72S,165
730"
716,491
1 j34,208
1,2.83,827
1,049,706
Community Development
28,161
243,088
17Q429
293,134
153,431
Mon
66,393
55,664
50979
64,6S5
Operating grants and conributions
3.5M307
2,554j22
2ffl8k746
2,636,321
1.839,425
1.354,890
1,470,485
1;AS,661
1,841,137
3,473,490
Capital grants and exrHxbms
3 51
1 39
1 649
1 19 825
3 6i8
94 125
1 50
7 439
11]31,091
Total governmental activities program revenues
12591,806
9,648,202
9,749j84
10,026,461
11,074,52.2
8901,041
ig627,854
17,492,750
22359,679
11,995,500
Business -Type activities:
Charges for services:
Airport
70,9W
76,572
75,813
78,657
79,091
72,623
74,22E
6%656
_
_
Water
2296,S94
2,430,3SC
2,740,512
2A%959
3.018,276
3335,072
3,891,449
4546,570
4�211,715
3,874,001
Sewer
4.124.020
4.554,155
4977.286
4967,223
5,141j84
5M3,740
7,485,750
7,774,762
8,007,450
7994,232
Solid Waste
805,613
85136
900,643
951,676
9733%
9MI45
1,005,786
1,021,797
1,048,091
1,076,047
Operating grants and conhibutiore
l416
8j54
8,372
27,721
137,04'
32,
31,078
47,478
55,235
ons
pital Cagram and contributions
SM609
679,690
1
2,137,977
1,098,27.2
3j38.
131,626
57%M
6,536,160653
5,2W,256
Total business -Type activities program revenues
185.736
8.994776
9714635
11129864
1 337 87
62 492
13 3845
19880.894
1 199771
Toll primary govemnent gograrn reverxres
;RAi
Net(Expense) 1 Pc enue
Govemnental activities
(9,214,103)
(12,1167An
(15j26,6D0)
(11.397.393)
(9,7529M
(11M,932)
(12,122MI)
(7,4911.170)
(6,457,125)
(15.554,410)
Business4ype activities
19
1
788.163
2 826
1.746 24
47l 069
3 SSl
3 1589d
i 03 848
7.676714
T0431 primary govemnwrt net expense
General Revenues and Other Charges in Net Posibcn
Govertmental activities:
Taxes
Property taxes
7.563,944
7.469972
S,092.684
8,739,807
7j84,775
8,357,90.4
8,84$481
8912,089
9.647.621
10_493,815
Fist.
98,469
106,7S3
151,0Q
1S4,781
189921
111"
200,015
201,5 n
99,876
128,414
Investrat earnings
81,041
130,836
71>5
48,193
TZ,531
105.557
159j62
210,s35
284,576
262j42
Grants and entitlemenIs not restricted
2131km
216BISV
2,657.356
2,83%264
3,134,'M
3,132�559
3jK831
3,177J13
3,074,926
3,425997
Gas Tax
366904
361,157
360,650
364,563
364,622
369,749
37IM3
522,s32
689,060
835,851
Gain Coss) sale Of capital assets
012,127)
IIA10
78,497
22,193
(196,262)
-
635M
Transfers
1
27188
5 1
i
5
35 000
35 000
04
Total govemmental activities
10j14,763
10.487,758
10995,156
11953,880
11�93,162
12,190j14
12,82),175
12,828,184
13,796,059
6,092,872
Business4ype activities:
Investrat earnings
163907
14VW
10L311
S3,224
113963
13V39
227,052
29%162
410,449
412935
Gain (loss) sale of capital assets
(41.786)
-
46,710
0.091)
-
-
R077j63)
-
Other
(312,736)
-
2,101
140,616
19,631
-
209MI
-
Transfers
112,5w
2l 728
65000
5
5
Total busness-Type activities
100 l3
480
30112
227774
234864
21I
162
457
4 35
Toll primary govemment
Change in Net Position
Govemrx:ntal activities
1,100,661
(1,580,124)
(4551-444)
366,4V
1j40,214
300382
698,944
5,337,014
7,33$934
(9,461,538)
Business4ype activities
5545
42 65
i 48.643
2701778
1974 98
4 52953
4114234
4 05G
574464
8.089649
Tool primary gwemffwrt
Unalldted StallStical section
137
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pal n C 4 0o G+ vCo f
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N rri R T C
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G9 H H fA 69 H H H
o p m c
al+�
In
a H I" Y
H H H
M
v.
�D�ppD
rn �D C N G+ M C� vryi
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Unaudited stabsticalsection
138
CITY OF KAL ISPELL. MONTANA
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
Past Ten Fiscal Years
(mod;fie d accrual basis of accounting)
2011
2D12
2013
2014
2015
2D16
2017
2018
2019
2020
Revenues
Taxes and assessments
8,301,367
9,957,628
8,915,749
8,735,146
11,275,636
9,324,431
12,456,526
13,518,677
13,633,324
14,293,833
Licenses and permits
323,271
395,211
330,807
423,354
381,045
664,391
1,229,925
1,115,019
746,187
946,567
Intergovernmental
7,865.669
6,142,095
6,882,344
6,405X5
5,406,703
5,743,188
6,314,835
12,269,442
5,883.270
7,639,407
Charges for services
4.740.643
4,511,738
4,339,260
4,386,312
4,630,575
4,935,344
3,006,5D7
3,022,950
2,887.000
2,863,094
Fines and forfeitures
549,267
539,579
585,9D6
572.066
539,234
495,347
454,547
443,919
512,999
514,035
Miscellaneous
251,459
147,907
129,351
194.272
189,615
289,652
138,075
116.693
143,271
108,699
Investment earnings
79,484
78,076
71,572
48,193
72,528
105,557
159,363
198.004
261,385
238,482
Total revenues
22,111,159
20.672,234
21,254,989
20,754,598
22,493,336
21,556,910
23,759,778
30,674,7D4
24,067,326
26,604,117
Expenditures
General govemmeni
2,532,377
3,4D9,323
2,512,714
2,893,332
2,623,226
2,991,935
2,495,710
3,127,703
3,233,559
3,392,162
Public safety
8.332.769
9,044,589
8,820,726
8,755,082
9,115"2
9,540,699
10,873,61D
10,644,186
1%719,151
10,879�234
Public works
3.039.460
2,673,729
2,904,562
2,376,067
2,672.152
2,191,012
2,327,678
2,857,261
5,166,350
3,638,526
Parks and recreation
1,385,997
1,439,646
1,519,173
1,664,595
1.609.497
1,550,943
1,714,235
1,986,322
2,092,271
1,941,DD1
Community development
2.034.606
1,355,200
3,616,337
1,601,170
685,019
923,170
853,455
1,275,659
2,860.796
2,048,260
Capital outlay
1,944.635
1,075,598
1,701,728
1,201,998
560,750
930,636
1,792,584
11,577,677
1,107.299
926,860
Debt service:
Principal
1.059,505
5,243,927
1.,259,716
1,264X7
1,330.057
1,980,720
1,294,872
1,787,726
1,324.876
1,341,973
Interest
580,361
639,724
390,770
357,857
331,911
286,401
242,110
226,589
381,767
333,593
Total expenditures
20,909,710
23,881,636
22,725,726
20,114,328
18,927,463
20,295,316
21,594�254
33,493,122
26,896,069
24,501,609
Excess of revenues
over (under) expenditures
1.201.449
(3,209,402)
(1,470,737)
640,270
3,565,873
1,261,594
2,165,524
(2,808,418)
(2,818,742)
2,1O2,508
Other Financing Sources (Uses)
Transfers in
1,229,303
1,414,504
1,512,214
1,639,721
2,201,276
2,022,611
1,020,234
4,115,790
992,570
1,D05,OD0
Transfers out
(1,229,303)
(1,414,504)
(1,512,214)
(1,63%721)
(2,176,276)
(1,987,611)
(985,234)
(4J15,790)
(992,570)
(1,D05,000)
Issuance of debt
100,462
4,921,585
243,680
403.623
124,040
461,933
134,287
6,148,597
104,917
1%824
Sales of capital assets
233,637
11,610
93,272
26,513
20,994
37,399
6,500
Bond premium
52,763
Total other financing sources (uses)
100,462
5,107,985
243,680
403,623
160,650
590,105
195,8D0
6,169,581
142,316
22,324
Net change in fund balances 1,301,911 1,898,583 (1,227,857) 1,043,893 3,726,523 1,851,699 2,361,324 3,361,163 (2,676,426) 2.124.832
Debt service as a percentage of
noncapital expenditures 8.65% 25.80% 7.95% 8.58% 9.05% 11.19% 7.76% 9.20% 6.62% 7.11%
Unaudited statistical section
139
REVENUE CAPACITY
Fiscal
Year Real
Ended Taxable
June 30, Value
CITY OF KALISPELL, MONTANA
NL RKET VALUE OF TAXABLE PROPERTY
Past Ten Fiscal Years
(in thousands of dollars)
Less Total Total Estimated
Tax Taxable Direct Market
lncretnent Valuation Tax Rate Value
Taxable
Value as a
Percentage
of Market Valuc
2011
$ 41,074
$
1,626
$
39,448
170.34
$
1,360,162
2.90%
2012
$ 41,785
$
1,716
$
40,069
175.93
$
1,413,041
2.84%
2013
$ 40,531
$
1,515
$
39,016
185.60
$
1,450,786
2.69%
2014
$ 40,798
$
1,464
$
39,334
185.10
$
1,506,125
2.61 %
2015
$ 41,761
$
2,240
$
39,521
187.80
$
1,587,574
2.49%
2016
$ 38,953
$
1,000
$
37,953
205.60
$
2,294,128
1.65%
2017
$ 39,229
$
1,211
$
38,018
212.70
$
2,307,546
1.65%
2018
$ 42,373
$
1,142
$
41,231
206.12
$
2,561,622
1.61%
2019
$ 43,808
$
940
$
42,868
205.76
$
2,638,150
1.62%
2020
$ 48,698
$
1,064
$
47,634
193.30
$
2,972,359
1.60%
Source:
Flathead County and Montana Department of Revenue
Note: Reappraised
by Montana department
of Revenue every other year
Unaudited statistical section
140
CITY OF KALISPELL, MONTANA
DIRECT AND OVERLAPPING PROPERTY TAX RATES
Past Ten Fiscal Years
(rate per $1000 of assessed value)
City of Kalispell
Overlapping
Rates
Fiscal
General
Total
Year
Obligation
Direct
Kalispell
Ended
Basic
Health
Debt
Tax
School
Community
Flathead
State
June 30.
Rate
Insurance
Service
Rate
District
college
County
Ed.
2011
141.50
14.64
14.20
170.34
333.52
15.96
122.77
46.00
2012
145.88
16.55
13.50
175.93
333.48
16.00
125.69
46.00
2013
154.60
18.50
12.50
185.60
333.96
15.52
125.96
46.00
2014
154.10
18.50
12.50
185.10
333.68
15.80
124.94
46.00
2015
156.80
18.50
12.50
187.80
332.58
16.90
128.88
46.00
2016
170.10
23.00
12.50
205.60
363.75
18.99
145.03
46.00
2017
174.20
26.00
12.50
212.70
348.07
21.45
148.18
46.00
2018
169.62
24.00
12.50
206.12
432.82
20.16
138.11
46.00
2019
171.26
23.00
11.50
205.76
424.34
20.33
142.07
46.00
2020
161.00
21.30
11.00
193.30
403.70
21.46
137.73
46.00
Source: Flathead County
Unaudited statistical section
141
CITY OF KALISPELL, MONTANA
PRINCIPAL PROPERTY TAX PAYERS
Current Year, and Nine Years Ago
2020
2012
Percentage
Percentage
of Total City
of Total City
Taxable
Taxable
Taxable
Taxable
I axpayer
Value
Hank
Value
Value
Rank
Value
4WESTICENTURYLINK INC
821,782
4
1.65%
1,108,299
2
2.73%
FLATHEAD ELECTRIC COOPERATIVE INC
2,192,100
1
4.41%
1,963,101
1
4.84%
NORTHWESTERN CORP TRANSMISSION & DISTRIBUTION
992,260
2
2.00%
541,264
4
134%
FLATHEAD HOSPITAL DEVELOPMENT COMPANY LLC
937,327
3
1.89%
558,262
3
138%
TKG MOUNTAIN VIEW PLAZA LLC
431,038
5
0.87%
244,062
8
0.60%
FIRST INTERSTATE BANK
222,443
10
0.45%
WAL-MART ESTATE BUSINESS TRUST
320,383
6
0.64%
370,278
7
0.91%
CROWN ENTERPRISES LLC
247,265
8
0.50%
CHARTER COMMUNICATIONS INC
239,124
9
0.48%
484,551
5
120%
TARGET CORPORATION
216,632
9
0.53%
RED LION HOTELS LIMITED PARTNERSHIP
375,704
6
0.93%
VERIZON WIRELESS
261,433
7
187,883
10
0.46%
Total
6,665,155
12.89%
6,050,036
14.93%
Total City Taxable Assessed Value
S 49,672,451
Source: Flathead County
GASB, Statement 44 requires the demographic and economic information should
indicate the principal property tax payers in the current year and nine years prior for comparison.
Nine year prior information is not available. This information will be updated as available.
Unaudited statistical section
142
S 40,531,328
Fiscal
Year
Ended
June 30
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
CITY OF KALISPELL, MONTANA
PROPERTY TAX LEVIES AND COLLECTIONS
Past Ten Fiscal Years
Collected within the
Taxes Levied Fiscal Year of the Levy Collections
for the Percentage in Subsequent
Fiscal Year Amount of Levy Years
Total Collections to Date
Amount
Percentage
of Levy
6,996,545
6,467,575
92.44%
386,182
6,853,757
97.96%
7,351,411
6,929,284
94.26%
285,281
7,214,565
98.14%
7,595,509
7,397,602
97.39%
123,598
7,521,200
99.02%
7,551,710
7,357,549
97.43%
111,016
7,468,565
98.90%
7,942,716
7,739,273
98.68%
68,908
7,808,181
99.56%
8,008,737
7,886,063
98.47%
112,049
7,998,112
99.87%
8,344,008
8,178,854
98.02%
154,723
8,333,577
99.87%
8,733,923
8,556,054
97.96%
167,611
8,723,665
99.88%
9,014,140
8,946,037
98.14%
156,442
9,002,479
99.87%
10,296,334
9,592,708
93.17%
NIA
9,592,708
93.17%
Source: Flathead County
City Manager's Final Adopted Budget
Unaudited statistical section
143
111aon] 9W.1a.[ejIVd
CITY OF KALISPELL, MONTANA
RATIOS OF OUTSTANDING DEBT BY TYPE
Past Tea Fiscal Years
Govemmmtal Activities
Business -Type
Activities
Fiscal
Year
General
Special
Total
Percentage
Ended
Obligation
Notes
Revenue
Assessment
Revenue
Notes
Primary
of Personal
Per
June 30,
Bonds
Pa ahle
Bonds
Bands
Bonds
Payable
Government
Income
Capita
2011
4.450.000
2,682.566
1,325,000
4.077,194
18,410,000
30,944,760
426%
$ 1,552.91
2012
4.145,000
7,422.191
1,700,000
3.845,329
17,333,000
29,445,520
3.87%
$ 1,453.67
2013
3,700,000
7,380.835
1,558,000
3.457,647
15,938.483
27,034,965
3.48%
$ 1,319.62
2014
3,255,000
7,177,968
1,410,000
3.397,922
15,667,682
172,988
26,076,560
323%
$ 1,243.40
2015
2,805,000
1,893,621
1,257,000
3,074,242
14,434,000
154,155
23.618,018
2.72%
$ 1,D97.59
2016
2,350,000
1,401.475
1,098,000
2,761,499
13,341,000
116,192
21,068,166
226%
$ 955.39
2017
1,885,000
1,204,829
933,500
2,427,060
12,287,096
77,849
18,815,334
1.81 %
$ 826.65
2018
1,415,000
1,458,992
5,891,760
2,045,507
13,443.771
39,121
24.294,151
221%
$ 1,D46.62
2019
940,000
1,325,573
5,532,493
1,793,229
27,977.473
0
32,568,773
2.73%
$ 1,360.55
2020
455,000
1,105.755
5,147,542
1,561,856
23,755,660
0
32,020,813
nla
$ 1,303.51
Source:
City Manager's Recommended Budget
City of Kalispell Finance
Department
Montana Department of Labor and Industry
Unaudited statistical section
144
CITY OF KALISPELL, MONTANA
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
Past Ten Fiscal Years
General Bonded Debt Outstanding
Percentage
Fiscal
of Actual
Year
General Special
Externally
Net
Taxable
Ended
Obligation Assessment
Restricted
Bonded
Value of
Per
June 30,
Bonds Bonds
for Repayment
Debt
Property
Capita
2011
4,450,000 4,077,194
531,075
7,996,119
20.3%
$
40127
2012
4,145,000 3,845,329
414,292
7,576,037
18.9%
$
374.01
2013
3,700,000 3,457,647
349,694
6,807,953
17.4%
$
332.31
2014
3,255,000 3,392,922
172,267
6,475,655
16.5%
$
308.78
2015
2,805,000 3,074,242
531,588
5,347,654
13.5%
$
248.52
2016
2,350,000 2,761,499
765,985
4,345,514
11.4%
$
197.06
2017
1,885,000 2,427,060
637,055
3,675,005
9.7%
$
161.46
2018
1,415,000 2,045,507
603,849
2,856,658
6.9%
$
123.07
2019
940,000 1,793,229
457,246
2,275,983
5.3%
$
95.08
2020
455,000 1,561,856
273,899
1,742,957
3.7%
$
70.95
Source:
City Managers Recommended Budget
Montana Department of Revenue
Montana Department of Labor and
Industry,
Quarterly Census of Employment and Wages (QCEW) Program
Unaudited statis&alsedon
145
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146
CITY OF KALISPELL, MONTANA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
Ruie 30, 2020
Governmental Unit
Overlapping General Obligation Debt:
Flathead County
Flathead Valley Community College
Kalispell High School
Kalispell Elementary
West Valley Elementary
Subtotal Overlapping Debt
City direct debt
Grand total direct and overlapping debt
Estimated
Estimated
Share of
Debt
Percentage
Overlapping
Outstanding
Applicable (1}
Debt
7,866,009
16.83%
1323,582
4,684,992
16.83%
788,325
35,552523
33.27%
11,828,549
27,498560
100.00%
27,498,560
5,360,000
39.02%
1091,341
43.530,356
1.099,057
100.00%
$ L099,057
44.629A B
Sources: Assessed value data used to estimate applicable percentages was provided by the State of
Montana, Department of Revenue. Debt outstanding data was provided by each governmental unit.
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of
the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that
is borne by the residents and businesses of Kalispell. This process recognizes that, when considering the
City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses
should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore
responsible for repaying the debt, of each overlapping government.
(1) For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using
taxable assessed property values. Applicable percentages were estimated by determining the portion of
another governmental unit's taxable assessed value that is within the City's boundaries and dividing it by
each unit's total taxable assessed value.
Unaudited statistical section
147
CITY OF KALISPELL, MONTANA
PT FDGM REVENUE COVERAGE
Past Ten Fiscal Years
Water/Sewer Revenue Bands
Fiscal
Year
Utility
Less:
Ended
Service
Operating
Debt Service
June 30,
Charges*
Expenses"
Principal
Interest
2011
6,810,442
(4,478,406)
(1,131,000)
(737,866)
2012
7,359,224
(4,143,706)
(1,007,000)
(647,296)
2013
8,063,596
(4,410,574)
(1,387,000)
(446,979)
2014
8,289,654
(4,516282)
(1,226,000)
(388,108)
2015
8,587,057
(4,370296)
(1242,000)
(369,564)
2016
9,523,918
(4,769,754)
(1,093,000)
(342,382)
2017
9,133,285
(4,647,56)
(1,117,000)
(316,036)
2018
10,154,805
(5,628,376)
(1,223,662)
(327,688)
2019
10,864,941
(5,768,642)
(1,569,738)
(507,040)
2020
10,873,469
(6,155,658)
(2,207,044)
(561,970)
*includes other revenues pledged for debt service
** excludes depreciation
Source:
City of Kalispell
Finance Department
Assessment Bonds
Special
Special
Assessment
Assessment
Debt Service
Coverage
Billing
Collections
Principal
Interest
Coverage
463.170
505.777
(334,210)
(212,843)
(41276)
1,561,222
332.474
(3916,662)
(185.444)
(249.632)
1,819,043
471,321
399.180
(391,662)
(186.121)
(178.603)
2,159,264
456,236
197,682
(324,198)
(171.133)
(297.649)
2,605,197
465,275
1,400,791
(326,526)
(163,360)
910,905
3,318,782
448,878
404275
(319,000)
(145.808)
(60.533)
3,052,682
433,302
389.479
(338,739)
(132.230)
(81.490)
2,975,079
427,331
375.435
(385,941)
(116.836)
(127.242)
3,019,521
338,686
281.508
(259,423)
(98.577)
(76.492)
1,948,797
334,157
263,260
(247,198)
(87,309)
(71247)
Unaudited stAE;bcal sedion
149
DEMOGRAPHICS AND ECONOMICS
CITY OF KALISPELL, MONTANA
DEMOGRAPHIC AND ECONOMIC STATISTICS
Past Ten Fiscal Years
Per
Capita
K-12
Almual
Calendar
Total Wages
Personal
School
UnemPloyment
Year
Population
(in thousands)
Income
Enrollment*
Rate**
2011
19,927
1,395,468
36,487
5,590
10.90°/a
2012
20,256
1,462,851
37,542
5,729
9.00%
2013
20,487
1,479,335
37,871
5,762
7.70%
2014
20,972
1,513,294
38,544
5,812
6.50%
2015
21,518
1,565,698
40,407
5,828
5.70%
2016
22,052
1,646,518
42,302
5,859
5.60%
2017
22,761
1,752,432
45,760
5,873
5.10%
2018
23,212
1,826,233
47,331
5,920
4.70%
2019
23,938
1,879,912
49,747
5,921
4.70%
2020
24,565
not available
not available
5,970
4.90%
School District 5
"unadjusted annual (calendar) - October unadjusted (2020)
Sources: Kalispell Public Schools Audit Report, enrollment
U.S. Census Bureau. population
Montana Department of Labor & Industry: Unemployment Rate, Personal Income,
Total Wages (Flathead County, City of Kalispell unavailable)
Unaudited statistical section
149
CITY OF KALISPELL, MONTANA
PRINCIPAL PUBLIC AND PRIVATE INDUSTRY EMPLOYERS
Most current information and Ten Year Prior (2011)
2020
2011
Estimated
Estimated
# of
# of
Private Employer
Employees
Employees
Industry
Kalispell Regional Healthcare
1000+
1000+
Healthcare
Teletech
250-499
500-999
fhofessional & Tech.
Applied Materials (Semitool Inc.)
250-499
500-999
Manufactiu-mg
Immanuel Lutheran Home
250-499
100-249
Healthcare
Summit Medical Fitness Center
100-249
100-249
Healthcare
AON Service Corporation - NFS
250-499
250-499
Insurance
A Plus Healthcare
100-249
not available
Healthcare
Brendan House
100-249
not available
Healthcare
Glacier Bank
250-499
250-499
Banking
L C Staffing Service
100-249
250-499
Temp. Services
McDonalds
100-249
100-249
Food
Smith's Food & Drug
100-249
100-249
Grocery
Super 1 Foods
250-499
250-499
Grocery
Costco
100-249
100-249
Retail
Walmart
250-499
250-499
Retail
Healthcenter Northwest
250-499
not available
Healthcare
Sources: Montana Department of Labor & Industry
The State of Montana, Department of Labor reports all employers
in each county and does not rank them or provide the number of employees as they
consider it confidential information.
Unaudited statistical section
150
OPERATING STATISTICS
CITY OF KALISPELL, MONTANA
Full -Time Equivalent City Government Employees by FunctiaalProgram
Past Ten Fiscal Years
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
General Government
Manager
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Human Resources
1.50
1.50
1.50
1.50
1.50
1.50
1.50
1.50
1.50
1.50
City Clerk
1.34
1.34
124
1.23
1.58
1.33
133
1.33
1.33
133
Media Specialist
0.55
0.55
Finance
3.20
320
320
3.20
320
320
320
3.20
3.20
320
Attorney
4.66
4.66
4.66
4.67
4.67
4.67
4.67
4.67
4.67
5.67
Court
4.00
4.00
4.00
4.00
4.00
4.00
4.00
4.00
4.00
4.00
City Hall
1.40
1.40
1.40
1.40
1.45
LAS
1A5
1.45
L45
1.45
Planning & Zoning
4.75
425
425
425
425
425
4.05
3.95
3.95
3.95
Building
3.45
3.95
3.95
3.95
520
520
6.75
8.65
8.65
8.65
Information Technology
1.00
L_50
225
225
115
255
2.55
2.55
2055
2.55
Total General Government
26.85
27.35
27A5
27.45
29.00
29.15
30.50
32.30
32.30
33.30
Public Safety
Police
41.00
42.DO
44.00
44.00
44.00
46.00
49.75
50.75
50.75
50.75
Fire
27.30
26.30
2730
2330
2330
2330
2330
22.90
2290
21.90
Ambulance
7.50
7.50
6.50
9.50
9.50
9.50
9.50
9.50
9.50
9.50
Total Public Safety
75.80
75.80
77.80
76.80
76.80
78.80
82.55
83.15
83.15
82.15
Public Works
DPW
025
0.25
025
0.25
025
0.25
025
025
0.25
0.25
Garage
3.00
3.00
3.00
3.00
3.00
3.00
3.00
3.00
3.00
3.00
Street Maint
12.65
1235
1225
1225
1225
1225
1325
1325
14.25
14.40
Sign/signal
2.50
250
2.50
2.00
2.00
2.00
2.00
2.00
200
2.00
Light District
0.80
0.75
0.75
1.25
125
125
125
125
1.25
1.40
Water
15.60
1525
14.90
14.80
14.80
15.30
1530
15.30
15.30
15.50
Sewer
8.45
7.55
7.00
7.05
7.05
7.55
7.55
7.55
8.05
825
WWTP
8.05
7.90
7.55
7.55
7.55
8.55
8.55
8.55
8.55
8.55
Storm
6.40
6.45
620
6.20
620
6.20
620
720
7.70
7.85
Solid Waste
7.35
7.25
735
7.40
7.40
7.40
7.40
7.40
7.40
7.55
Total Public Works
65.05
63.25
61.75
61.75
61.75
63.75
64.75
65.75
67.75
68.75
Parks and Recreation
Parks and Recreation
8.90
8.90
9A5
9.80
9.80
9.80
10.60
1060
10.80
10.80
Forestry
3.00
3.00
320
2.85
1.80
1.80
2.00
3.00
3.80
3.80
Total Parks and Recreation
11.90
11.90
12.65
12.65
11.60
11.60
12.60
13.60
14.60
14.60
Community Development
UDAGlComm. Dev.
2.00
2.00
2.00
2.00
1.75
1.75
2.00
2.00
2.00
2.00
Airport
Airport
0.50
0.5D
0.50
0.50
0.00
0.00
0.00
0.00
0.00
0.00
Total all funds
192_10
180.8D
182.15
181.15
180.90
185.05
192.40
196.80
199.80
200.80
Source: City Manager's Recommended Budget
Unaudited statistical section
151
CITY OF KALUnEL, MONTANA
OrPERATINC INMCATORS BY FUNCTION
Past Ten Fiscal Y�
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
General Government
Resolutions passed
71
66
59
51
41
44
57
58
56
50
Ordinances passed
25
12
12
12
14
17
15
17
17
26
Payroll claims processed
6038
59%
6035
6063
5956
6169
6473
6351
6008
6351
Aomunts payable claims processed
6178
6248
6461
6425
6704
6504
6716
6784
6905
6745
Receipts processed
10693
10749
10930
10984
10346
I M5
13073
12687
11686
10209
Condbonal use permits granted
5
7
5
4
4
6
5
12
4
5
Public Safely
Calls for law enforcement service
26550
27600
28650
29706
31419
34626
33186
34467
36459
33578
Citations
6300
6100
5877
5261
5233
5037
46W
4948
5760
4786
Arrests
1800
1700
1643
1316
1549
1734
1405
1659
1660
1687
Calls for fire service
5M
627
708
831
697
798
882
796
906
1157
Calls for rescue service
2037
2971
2197
2281
2560
2501
2673
2712
2792
2702
Building permits slued:
Residential
188
175
258
270
195
195
222
181
183
216
Commercial
196
178
254
262
163
137
137
176
86
71
Public Works
Streets and alleys maintained (Miles)
139
139
139
139
140
140
1"
155
155
155
Sidewalk replaced (linear feet)
776
1704
1476
1510
1723
1589
794
1853
1468
1234
Alleys payed
12
10
14
7
5
6
6
7
10
13
Parks
Park users(reservaticm)
143190
157288
132291
144937
123633
103M
102533
101493
92161
92161
Acres of parks
42949
429.49
42949
429A9
42949
429A9
42949
429A9
429.49
429A9
Recreation participants [rec, sports, youth, swim]
27525
32109
36415
43490
41830
35697
35370
35370
42526
403113
Miles of trails
4.70
6.35
6.85
7.98
B.10
8.10
B.85
8.85
B.85
8.85
Community Development
TIF I TEDD Districts
4
4
4
4
4
4
4
5
5
5
New loans
0
3
3
3
1
0
1
2
0
2
Loans receivable being serviced
13
16
19
21
22
19
20
10
9
10
Airport
Monthly be down fees (average)
12
9
7
3
0
0
0
0
0
0
Monthly commercial fees (average)
4
5
6
7
7
6
6
4
0
0
Water
Average daily consumption (millions of gallons)
2.87
2.81
2.85
279
2.96
3.13
2.96
2.33
2.33
3.23
Number of customers
7468
7530
7625
7641
7675
T7B5
7907
8083
8263
8363
Sewer
Average daily wastewater treated [millions of gall
3.1
2.7
2.6
2.7
2.7
2.5
2.7
2.B
2.7
2.4
Solid Waste
Refuse collected (tons per day)
21.1
21.3
23.0
24.1
25.0
26.0
26.9
27.1
27.7
28.5
Source: City of Kalispell
U-di�d statisucsr -cr-
152
CITY OF KAIJSPELJ, MONTANA
Capital Asset Statistics by Function/Program
Past Ten Fiscal Years
FY11
FY12
FY13 FY14
FY15
FY16
FY17
FY18
FY19
FY2U
Police
Stations
1.00
1-DO
1.00 1.00
1.00
1.00
1.00
1.00
1.00
1.00
Patrol Units (Cars)
11.00
11.DO
11.00 11.00
11.00
11.00
11.00
11.00
11.00
11.00
Patrol Units (Motorcycles)
2.00
2.00
2.00 2.00
2.00
2.00
2.00
2.00
2.00
2.00
Fire
Stations
2.00
2.00
2.00 2.00
2.00
2.00
2.00
2.00
2.00
2.00
Fire Trucks
4.00
4.00
4.00 4.00
4.00
4.00
4.00
4.00
4.00
4.00
Ambulances
4.00
4.00
4.00 4.00
4.00
4.00
4.00
4.00
4.00
4.00
Water
Mains (Miles)
126.00
126.00
126.00 128.00
128.00
129.50
129.75
130.05
137.50
143.00
Wastewater
Sanitary Mains (Miles)
130.50
130.50
130.50 131.00
131.00
131.00
131.00
131.60
138.80
141.00
Storm Mains [Miles]
52.00
5200.
53.00 53.00
53.50
53.50
53.50
53.75
66.80
68.00
Lift Stations
40.00
40.00
40.00 41.00
41.00
41.00
41.00
41.00
41.00
43.00
Solid Waste
Collection Vehicles
8.00
8.00
8.00 8.00
8.00
8.00
8.00
8.00
6.00
6.00
Other Vehicles
2.00
2.00
2.00 2.00
2.00
2.00
2.00
2.00
2.00
2.00
Source: City of Kalispell
Unaudited statistical section
153
I:I1]1]11MONF:Im1►1go] . 05W-1IMONI
CITY OF KALISPEI.I., MONTANA
THE WATER SYSTEM
Past Four Fiscal Years
Major Water System Users
User
Type of
Business
Fiscal Year
2016117
Water
Charges
% of
Fiscal Year
2016117 Fiscal Year
Water 2017118
Revenues Water
$ 2,824,434 Charges
% Of
Fiscal Year
2017118 Fiscal Year
Water 2010119
Revenues Water
$ 3,148,034 Charges
% of
Fiscal Year
2010119 Fiscal Year
Water 2019120
Revenues Water
$ 3,061,790 Charges
% of
Fiscal Year
2019120
Water
Revenues
$ 2,875,645
Holiday Inn Express
Lodging
$ 10,259
0.32% $
12,576
0.36% $
13,696
OA5% $
9,702
0.34%
KRMC
Hospital
$ 74,324
2.33% $
70,8T7
2.01 % $
63,115
2.06% $
56,850
1.98%
Red Lion Hotel
Hotel
$ 15,919
0.50% $
17,938
0.51 % $
16,274
0.53% $
15,426
0.54%
John PescheWalley Linen
Cleaner
$ 1%724
0.62% $
21,615
0.61% $
18,597
0.61% $
11,645
0. G%
Hilton Garden Inn
Hotel
$ 10,901
0.34% $
11,896
0.34% $
11,416
0.37% $
9,345
0.32%
The Summit
Athletic Club
$ 18,678
0.59% $
14,157
0.40% $
15,231
0.50% $
14,123
DA9%
Health Center NW
Hospital
$ 13,019
0.41% $
13,413
0.3B% $
14,001
OA6% $
11,031
0.38%
Heritage Place
Nursing Home
$ 10,917
0.34% $
23,877
0.68% $
1%481
0.64% $
22,841
0.79%
Hampton Inn
Hotel
$ 11,172
0.35% $
12,275
0.35% $
10,868
0.35% $
9,990
0.35%
Brendan House
Nursing Home
$ 10,137
0.32% $
9,791
0.28% $
10,042
0.33% $
9,791
0.34%
Hutton Ranch Place
Retail
$ 9,698
0.30% $
13,453
0.315% $
11,554
0.38% $
13,107
0.46%
Total
$ 204,74B
6.12% $
221,068
5.91 % $
204,275
6.67% $ 1 B3,931
6.40%
Water Sold by Customer Type
2017 2018 2014 2020
Type of Customer
Residential 648,231 725,939 763.521 624.711
Commercial 538,038 650,721 610,958 556.796
Total
1,196,269
1,376,660
1,374,479
1,181,507
Total direct rate
$ 2.43
$ 232
$ 227
$ 2.57
per 1000 gallons
Water Rates
Fiscal
Water
Irrigation (.
Year
Monthly
Rate per
Monthly
Rate per
Ended
Base
1000
Base
1000
Junp.10�
Rate
Gallons
Rate
Gallons
in city Out of city
in city art of city
in city out of city
in city out of city
2017
$
7.50 938
$ 2.43 3.04
$
7.50 938
$
1.55 1.94
2018
$
7.50 938
$ 2.43 3.04
$
7.50 938
$
1.55 1.94
2019
$
7.50 938
$ 2.43 3.04
$
7.50 938
$
1.55 1.94
2020
$
7.50 938
$ 2.43 3.04
$
7.50 938
$
1.55 1.94
Sources: City of Kalispell
City ofKAispa Resolutions 4798/4799/5491
Some custormers pay to install a separate irrigation
meter and are then billed actual meter readings for
their irrigation use_ The City also bills customers
a "sprinkling" rate based off of an average usage
in the "winter months" deduction.
Unaudited statistical section
154
CLTY OF KALISPELL, MONTANA
THE SEWER SYSTEM
Past Four Fiscal Years
Sewer Sold by Customer Type
2017 2018 2019 2020
Type of Customer
Residential 409,063 372,713 468,674 391,342
Commercial 507,824 537,721 519,977 494,274
Total
916,887 910.434
9W651
885,616
Total direct rate
$
4.85 $ 4.99
$ 4.57
$ 5.05
per 1000 gallons
Sewer Rates
Flathead County Water & Suva District #1
Fiscal
Sewer
- Evergreen
Year
Monthly
Rate per
Monthly
Rate per
Ended
Base
1000
Base
1000
June 30
Rate
Gallons
Rate
Gallons
in city out of city
in city out of city
Eclagrem**
EcIergreen"
2017
$
8.44
10.55
$
4.78 5.98
12,024.00
2 76
2018
$
8.44
10.55
$
4.78 5.98
11,01228
208
2019
$
8.44
10.55
$
4.78 5.98
12,334.26
250
2020
$
8.44
10.55
$
4.78 5.98
10,670.00
220
Sources: City of Kalispell
City o£Kahspell Resolutions4798/4799/5491
"Evergreen has its Own collections system and
only uses the City's sewage treatment plant,
which results in a reduced charge_ The City
bills the district, which in turn bills the users
within the district. The district is counted as
1 sewer connection.
Unaudited statistical section
155
City of Kalispell, Montana
Tax Increment District Taxable Valuation Detail
Past Six Fiscal Years
Westside Tax Increment District
(Kalispell C)
expires January 1, 2037
Fiscal
Base
Incremental
Total
Year
Value
Value
Value
2019720
$
7,932,918
$ 610,039
$ 8,542,957
2018119
$
7,932,918
S 75,444
$ 8,008,362
2017118
$
7,932,918
$ 278,291
$ 8,211,269
2016117
$
7,932,918
S 399,951
$ 8,332,869
2015116
$
7,932,918
$ -
$ 6,663,336
2014115
$
7,932,918
S 1,219,018
$ %151,936
Old School Station, Technology
(Kalispell G)
(expires January 1, 2020)
Fiscal
Base
Incremental
Total
Year
Value
Value
Value
2019720
1
390
$ 89,170
$ 89,560
2018/19
$
390
$ 88,448
$ 88,836
2017118
$
390
$ 106,867
$ 107,277
2016117
$
390
$ 94,851
$ 95,241
2015116
$
390
$ 95,864
$ 96,254
2014115
$
390
$ 111,723
$ 112,113
Glacier Rail Park TEDD
(expires January 1, 2032)
Fiscal Base Incremental Total
Year Value Value Value
2019120 $ 7,057 $ - $ 5,4D9
2018119 $ 7,057 $ 541 $ 7,598
2017118 $ 7,057 $ 619 $ 7,676
Source: Based on information provided by Flathead County and the Montana Department of Revenue
Note: Property is assessed by the State Department of Revenue every two years.
South KalispelllAirport
(Kalispell B)
expires January 1, 2020
Base
Incremental
Total
Value
Value
Value
S 453,612
$ 858,575
$ 1,312,187
S 453,612
$ 7%303
$ 1,213,915
S 453,612
$ 737,446
$ 1,191,058
S 453,612
$ 695,599
$ 1,14%211
S 453,612
$ 883,637
$ 1,337,249
$ 453,612
$ 886,318
$ 1,33%930
Old School Station, Industrial
(Kalispell H)
[expires January 1, 202)]
Base
Incremental
Total
Value
Value
Value
S 126
$ 14,841
S 14,967
S 126
$ 15,782
S 15,908
S 126
$ 18,751
$ 18,877
$ 126
$ 20,764
S 20,890
$ 126
$ 20764
S 20,890
$ 126
$ 22,757
S 22,883
Unaudited statistical section
156
City of Kalispell, Montana
Tax Increment District's Comparison to City Taxable Value
Past Six Fiscal Years
South Kalispell/Airport TIF
(Kalispell B)
(expires
July 1, 2020)
Incremental
District's Incremental
Assessed/Market
Taxable Value of
Taxable
Taxable Value as
Fiscal
Value of Property in
Property in the
Value of
City Taxable Value
Percentage of City's
Year
the Airport TIF
Airport TIF
Airport TIF
(excludes Incremental Value)
Taxable Value
2019/20
$
75,878,228
$
1,312,187
$ 858,575
$
47,839,864
1.79°Io
2018/19
$
70,195,574
$
1,213,915
$ 760,303
$
42,868,315
1.77%
2017/18
$
68,873,850
$
1,191,058
$ 737,446
$
41,231,226
1.79%
2016/17
$
68,131,560
$
1,149,211
$ 695,599
$
38,018,010
1.83%
2015/16
$
64,810,206
$
1,337,249
$ 883,637
$
37,952,794
2.33%
2014/15
$
58,500,554
$
1,339,930
$ 886,318
$
39,521,550
2.24%
Westside TIF
(Kalispell C)
(expires January 1, 2038)
Incremental
District's Incremental
Assessed/Market
Taxable Value of
Taxable
Taxable Value as
Fiscal
Value of Property in
Property in the
Value of
City Taxable Value
Percentage of City's
Year
the Westside TIF
Westside TIF
Westside TIF
(excludes Incremental Value)
Taxable Value
2019/20
$
462,009,037
$
8,542,957
$ 610,039
$
48,088,400
1.27%
2018/19
$
448,463,121
$
8,292,481
$ 75,444
$
42,868,315
0.18%
2017/18
$
430,387,494
$
8,153,865
$ 278,291
$
41,231,226
0.67%
2016/17
$
420,898,376
$
8,268,210
$ 399,951
$
38,018,010
1.05%
2015/16
$
393,088,367
$
6,520,032
$ -
$
37,952,794
0.00%
2014/15
$
340,553,479
$
9,129,813
$ 1,219,018
$
39,521,550
3.08%
2013/14
$
315,211,210
$
8,324,668
$ 394,482
$
39,334,849
1.00%
Source: Based on information provided by Flathead County and the Montana Department of Revenue
Note: Property is assessed by the State Department of Revenue every two years.
Unaudited statistical section
157
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158
O
O
N
City of Kalispell, Montana
Principal Property Tax Payers in
Westside TIF
Last Three Fiscal Years
Taxpayer
Type of
Business
2017/18
Taxable
Value $
% of
TIF District
Taxable
Value
8,153,865
2018119
Taxable
Value
% of
TIF District
Taxable
Value
$ 8,008,362
2019/20
Taxable
Value
% of
TIF District
Taxable
Value
$ 8,542,957
1 Centurylink
Telecommunications
$
1,348,700
16.54%
$ 1,154,887
14.42% $
961,073
12.00%
2 Flathead Electric Coop
utility
$
454,035
5.57%
$ 484,915
6.06% $
515,795
6.44%
3 WSPGB Mall LLC
Mall
$
207,697
2.55%
$ 221,014
2.76% $
216,116
2.70%
4 First Interstate Bank
Financial Services
$
149,311
1.83%
$ 163,166
2.04% $
177,021
2.21%
5 Stoneriver National Flood Services
Insurance
$
128,219
1.57%
$ 131,795
1.65% $
157,324
1.96%
6 Northwestern Energy
utility
$
146,846
1.80%
$ 149,254
1.86% $
151,661
1.89%
7 Spring Creek Development LLC
Lodging
$
135,120
1.66%
$ 136,167
1.70% $
137,214
1.71%
8 Three Rivers Bank
Financial Services
$
103,798
1.27%
$ 110,548
1.38% $
117,316
1.46%
9 Kalispell Ventures LLC
Assisted Living
$
100,878
1.24%
$ 108,953
1.36% $
117,028
1.46%
10 FCEDA1Teletech
Call Center
$
104,628
128%
$ 10010
1.33% $
108591
1.36%
Total
$
2,879,232
35.31%
$ 2,767,309
34.56% $
2,659,139
3320%
m
C
a
L/1 N
�,
❑ehi Servioe ('.overage for the Wesiside TIF
N
n'$$0
w
m
Westside Tax Increment Revenue available for debt service
$
530,029 $
357,028
$ 705,082
C,
Average Annual Debt Service(l)
$
375,700 $
375,700
$ 375,700
Debt Service Coverage
1.41
0.95
1.88
(1) Average annual debt service on the outstanding Westside TIF Bonds
is equal to $7,138,302119 per the debt
schedule in the Official Statement.
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160
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(D N M
CITY OF ItiALISPELL, MONTANA
Special Improvement Districts Operating Data
June 30, 2020
Outstanding SIDS
Original
Maturity
Bonds
Cash
Assessments
Delinquent
Bond Issue Amount
Date
Outstanding
Balance
Outstanding Assessments
1 SID 344 $ 4,520,000
6/30/2026
$1,370,000
$ 7,230
$1,637,061
$ 385,638
2 SID 345 $ 242,000
6/30/2029
$ 148,000
$ 23,731
$ 138,868
$ 125
TOTAL $ 4,762,000
$1,518,000
$ 30,961
$1,775,929
$ 385,763
Revolving Fund Balance and Bonds Secured Thereby - SIDs Billing and Collections
Last Ten Fiscal Years
Revolving Fund
Principal
Cash
Amount
Assessment
Total Annual
Fiscal Year Ended June 30,
Balance
of Debt
Billing
Collections
2011
$
257,706
$
4,077,194
$
508,579
$
473,562
2012
$
263,371
$
3,845,329
$
485,908
$
272,308
2013
$
268,008
$
3,457,647
$
471,321
$
364,982
2014
$
281,562
$
3,392,922
$
456,236
$
187,565
2015
$
283,466
$
3,074,240
$
465,275
$
616,527
2016
$
285,488
$
2,761,499
$
448,878
$
396,747
2017
$
288,807
$
2,427,060
$
433,302
$
379,258
2018
$
292,053
$
2,045,507
$
417,768
$
365,721
2019
$
296,996
$
1,793,229
$
329,721
$
272,959
2020
$
221,196
$
1,518,000
$
324,327
$
253,437
unaudited statistical sedon
161
City of Kalispell, Montana
General Obligation Debt Ratios
Last Five Fiscal Years
2015/16
2016/17
2017/18
2018/19
2019I20
Direct Debt Per Capita
319.34
259.57
443.54
355.03
44.74
Direct and Estimated Overlapping Debt Per Ca
1,311.15
1,281.12
2,394.49
2,394.40
1,816.79
Direct Debt to the City's Assessed/Market Valu,
0.31%
026%
0.40%
0.32%
0.04%
Direct and Estimated Overlapping Debt to the CiWs
Assessed[Market Valuation
126%
126%
2.17%
2.17%
1.50%
Direct Debt to the City's Taxable Valuation
(excluding incremental values)
18.55%
15.54%
24.97%
19.40%
2.26%
Direct and Estimated Overlapping Debt to the CiWs
Taxable Valuation {excluding incremental
values'
76.180A
76.700A
134.800I
130.830A
91.640A
CiwsAssessed/Market Valuation Per Capita
104,033
101,382
110,358
110,208
121,000
CiWs Taxable Valuation Per Capita (excluding
incremental values)
1,721
1,670
1,776
1,830
1,783
unaudited statistical section
162
SINGLE AUDIT SECTION
REPORTS OF INDEPENDENT
PUBLIC ACCOUNTANTS AND
SCHEDULE OF EXPENDITURES OF
FEDERAL AWARDS
AS REQUIRED BY U.S. OFFICE OF MANAGEMENT AND
BUDGET UNIFORM GUIDANCE, AUDITS OF STATE AND
11:4[e�:I.iroll11ON!
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163
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Fiscal Year Ended June 30, 2020
Basis of Accounting
The accompanying Schedule of Expenditures of Federal Awards includes the federal award activity of the
City of Kalispell, Flathead County, Montana, under programs of the federal government for the year ended
June 30, 2020. The information in this schedule is presented in accordance with the requirements of OMB
Code of Federal Regulations, Uniform Administrative Requirements, Cost Principles and Audit
Requirements for Federal Awards, 2 CFR 200 (Uniform Guidance). Federal awards received directly from
federal agencies and passed through other government agencies is included in the schedule.
Summary of Significant Accounting Policies
Expenditures reported in the schedule are reported on the modified accrual basis of accounting, which is a
comprehensive basis of accounting other than US GAAP and is a different basis of accounting than the
basic financial statements (full accrual). Therefore, some amounts presented in this schedule may differ
from amounts presented in, or used in the preparation of, the basic financial statements.
Indirect Costs
The City did not elect to use the 10% de minimis indirect cost rate from Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Guidance Administrative Requirements, Subpart Cost Principles.
Sub Recipients
The City of Kalispell's schedule of expenditures of federal awards does not include any sub recipients or
sub recipient expenditures in fiscal year 2020.
164
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
City Council Members
City of Kalispell
Kalispell, Montana
We have audited, in accordance with auditing standards generally accepted in the United States and the
standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller
General of the United States, the financial statements of the governmental activities, the business -type
activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining
fund information of the City of Kalispell, Montana (the City) as of and for the year ended June 30, 2020, and
the related notes to the financial statements, which collectively comprise the City's basic financial statements,
and have issued our report thereon dated December 21, 2020.
Infernal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control over
financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose
of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an
opinion on the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial
statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a
deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness,
yet important enough to merit attention by those charged with governance.
Our consideration of internal control over financial reporting was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify
any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses
may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts,
and grant agreements, noncompliance with which could have a direct and material effect on the
financial statements. However, providing an opinion on compliance with those provisions was not an
objective of our audit and, accordingly, we d❑ not express such an opinion. The results of our tests
disclosed no instances of noncompliance or other matters that are required to be reported under
Government Auditing Standards.
165
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and
the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control or on
compliance. This report is an integral part of an audit performed in accordance with Government Auditing
Standards in considering the City's internal control and compliance. Accordingly, this communication is not
suitable for any other purpose.
Wipfli LLP
Helena, Montana
December 21, 2020
166
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE
REQUIRED BY THE UNIFORM GUIDANCE
City Council Members
City of Kalispell
Kalispell, Montana
Report on Compliance for Each Major Federal Program
We have audited the City of Kalispell's (the City) compliance with the types of compliance requirements
described in the U.S. Office of Management and Budget (OMB) Compliance Supplement that could have a
direct and material effect on each of the City of Kalispell's major federal programs for the year ended June 30,
2020. The City's major federal programs are identified in the summary of auditor's results section of the
accompanying schedule of findings and questioned costs.
Management's Responsibility for Compliance
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of
its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the City's major federal programs
based on our audit of the types of compliance requirements referred to above. We conducted our audit of
compliance in accordance with auditing standards generally accepted in the United States; the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part
200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit
to obtain reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal program occurred. An audit
includes examining, on a test basis, evidence about the City's compliance with those requirements and
performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal
program. However, our audit does not provide a legal determination on the City's compliance.
Opinion on Each Major Federal Program
In our opinion, the City complied, in all material respects, with the types of compliance requirements referred
to above that could have a direct and material effect on each of its major federal programs for the year ended
June 30, 2020.
167
Report on Infernal Control over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above. In planning and performing our audit
of compliance, we considered the City's internal control over compliance with the types of requirements that
could have a direct and material effect on a major federal program to determine the auditing procedures that
are appropriate in the circumstances for the purpose of expressing an opinion an compliance for each major
federal program and to test and report on internal control over compliance in accordance with the Uniform
Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, we do not express an opinion on the effectiveness of the City's internal control over
compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent or detect and correct noncompliance with a type of compliance requirement of a federal
program on a timely basis. A material weakness in infernal control over compliance is a deficiency, or
combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that
material noncompliance with a type of compliance requirement of a federal program will not be prevented or
detected and corrected on a timely basis. A significant deficiency in intemal control over compliance is a
deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance
requirement of a federal program that is less severe than a material weakness in internal control over
compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over compliance
that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal
control over compliance that we consider to be material weaknesses. However, material weaknesses may
exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of
internal control over compliance and the results of that testing based on the requirements of the Uniform
Guidance. Accordingly, this report is not suitable for any other purpose.
Wipfli LLP
Helena, Montana
December 21, 2020
168
City of Kalispell, Montana
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Year Ended June 30, 2020
Section I: Summary of Auditor's Results
Financial Statements
Type of auditor's report issued: Unmodified
Internal control overfinancial reporting:
Are any material weaknesses identified? _Yes x No
Are any significant deficiencies identified not considered to be
material weaknesses? _Yes x None Reported
Is any noncompliance material to financial statements noted? _Yes X No
Federai Awards
Type of auditor's report issued on compliance for major programs: Unmodified
Internal control over major program compliance:
Are any material weaknesses identified? Yes x No
Are any significant deficiencies identified not considered to be
material weaknesses? _Yes x None Reported
Are any auditfindings disclosed that are required to be reported in
accordance with the Uniform Guidance [2 CFR 200.516(a)] _Yes X No
Identification of major programs:
CFDA Number and Name of Federal Program or Cluster
21.019 Coronavirus Relief Fund
66.468 Capitalization Grants for Drinking Water State Revolving Funds
Enter the dollar threshold used to distinguish between Type A
and Type B programs: $ 750,000
Is the auditee qualified as a low -risk auditee? _Yes x No
169
Section II: Financial Statement Findings
There were no findings related to the financial statements that are required to he reported in accordance with
Government Auditing Standards.
Section III: Federal Award Findings
There were no findings related to federal awards that are required to be reported in accordance with Government
Auditing Standards.
Section IV: Current Status of Prior Year Findings
There were no prior year findings required to be reported in accordance with Government Auditing Standards.
170