quarterly financial report - q3 2018 · 2019. 1. 14. · (this report contains un-audited financial...

"A colorful past, a bright future"

Quarterly Financial Report

Third Quarter 2018

Third Quarter 2018 Financial Report City of Vancouver 1

Third Quarter 2018 Financial Report (This report contains un-audited financial information as of November 9, 2018)

Table of Contents

Section Page

I. Executive Summary 3 II. Economic Report 4 III. Financial Results 13 IV. Outstanding Debt 26 V. Investments 26 VI. Interfund Loans 29

Attachments

A Expenditure Summary by Fund 30 B Revenue Summary by Fund 32 C Investment Portfolio Tables 34 D Outstanding Debt 38

- - - - - For additional information on the City’s financial performance please contact Natasha Ramras in the City’s Financial & Management Services Department at 360-487-8484.


I. Executive Summary

The national economy continued to grow through the third quarter of 2018, according to the advance estimate published by the Bureau of Economic Analysis. Real GDP increased by 3.5% in the third quarter, comparable to the average rate of growth during the first two quarters of the year. The increase in real GDP in the third quarter reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, state and local government spending, federal government spending, and nonresidential fixed investment that were partly offset by negative contributions from exports and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

City of Vancouver General Fund revenues in the third quarter of 2018 totaled $118.8 million, or 72% of the forecasted revenues for the year. The revenue increase is largely attributable to increased collections of utility tax on Water, Drainage, Sewer, Solid waste and continuing elevated sales tax revenues. An inflationary increase in the underlying City utility rates went into effect January 1, 2018. The first three months of 2018 include revenue from the 3.4% utility tax increase dedicated to funding additional Police department staff that went into effect in 2017. Sales tax revenues continue to exceed projections due to strong auto sales, elevated construction, and an overall strong economy. General Fund expenditures at the end of the third quarter totaled $110.4 million, $4.4 million higher than in the prior year, but on track to come in below the budget for the year. The General Fund operating cash balance was $59.7 million at the end of September 2018. Following is detailed information on the main revenue sources of the General Fund. Cumulatively, the seven major sources of revenue listed on the chart below represent more than 83.0% of the total revenues in the City’s General Fund.

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

Property Tax SalesTax Utility Tax Electrical Tax TelephoneTax

Natural GasTax, BNG

Charges forSvcs.

$25.9 $26.9

$16.9

$6.7

$3.1 $1.8

$4.8

$26.5 $28.6

$20.2

$6.9

$3.2 $2.1

$4.6

$28.0

$31.4

$23.2

$6.9

$2.7 $2.0

$5.0

Milli

ons

of D

olla

rs

General Fund Major Tax Revenue Collections

SEP-16 SEP-17 SEP-18

Note: Utility tax revenue above includes the tax on Solid Waste; Charges for Services exclude the Business License revenue.


II. Economic Report The US economy continued to improve into the third quarter of 2018. The unemployment rate continued to decline, the housing sector has been showing signs of cooling – the inventory is growing and prices have started indicating some downwards pressure. The following is specific information related to some of the major national economic indicators, beginning with Gross Domestic Product. The pace of growth of the national economy, as reported by the Bureau of Economic Analysis, was slightly lower than that during the second quarter – at 3.5%. The most recent data indicates positive contributions from personal consumption expenditures (PCE), private inventory investment, state and local government spending, federal government spending, and nonresidential fixed investment that were partly offset by negative contributions from exports and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.1

The national seasonally adjusted unemployment rate continued to hover at a historically low level of 3.7% through the third quarter of 2018. The number of long-term unemployed (those jobless for 27 weeks or more) declined slightly through September, accounting for 22.5 percent of the unemployed. Nationally, employment gains occurred in several industries, led by healthcare, durable goods manufacturing, construction, transportation and warehousing. The numbers of unemployed workers have remained at an estimated 6.1 million nation-wide2.

1 National Income and Product Accounts; Gross Domestic Product: Second Quarter 2018 (Advance Estimate, and Comprehensive Update, https://bea.gov/newsreleases/national/gdp/2018/gdp3q18_adv.htm 2 https://www.bls.gov/news.release/empsit.nr0.htm


Data Source: w ww.bls.gov

• The October of 2018 Federal Open Market Committee’s press release confirmed that “the labor market has continued to strengthen and economic activity has been rising at a strong rate in the third quarter. The flooding and damage from Hurricane Florence, which made landfall on September 14, seemed likely to have a modest, transitory effect on national economic growth in the second half of the year. Consumer price inflation, as measured by the 12-month percentage change in the price index for personal consumption expenditures (PCE), remained near 2 percent in July. Survey-based measures of longer-run inflation expectations were little changed on balance.”

• One of the major measures of consumer confidence is the Conference Board’s compiled Index of Consumer Confidence. Three thousand households across the country are surveyed each month to determine consumer perceptions of current business and employment conditions, as well as consumer expectations for the upcoming six months. The level of consumer confidence is associated with anticipation about future developments in the economy, and is used as an indicator of the likely general direction of consumer spending in the coming months. The index began moving up in 2016 with the trend continuing during 2017, reaching a level of 122.1 in December of 2017. This index continued to increase in 2018, reaching 135.3 by September, a level last seen in the fall of 2000. “Consumers’ assessment of present-day conditions remains quite positive, primarily due to strong employment growth. The Expectations Index posted another gain in September, suggesting that consumers do not foresee the economy losing steam anytime soon. Rather, they expect the strong pace of growth to carry over into early 2019.”3

3 https://www.conference-board.org/data/ConsumerConfidence.cfm


• A second measure of consumer attitudes, the University of Michigan Consumer Sentiment, paints a similar picture. The indicator has been hovering at the historically high level during the third quarter, ending September at a reading of 98.5. This resilience was primarily due to the prevailing belief that the economy would produce robust job growth during the year ahead, even if overall wage growth remained dismal. Consumers now place a higher value on job security compared with wage growth due to job losses in the Great Recession as well as the aging of the labor force.4 The University of Michigan data indicates that the pace of growth in real consumption can be expected to average 2.6% during late 2018 and into the first half of 2019.

• The US Conference Board tracks ten different economic indicators in order to assess the health of the economy and to evaluate the direction of economic development in the near future. The cumulative product of the ten indicators is called the US Leading Economic Index (LEI). The US LEI has increased steadily since early 2009, reaching a high level of 111.8 in September of 2018.

“The US LEI improved further in September, suggesting the US business cycle remains on a strong growth trajectory heading into 2019. However, the LEI’s growth has slowed somewhat in recent months, suggesting the economy may be facing capacity constraints and increasingly tight labor markets,” said Ataman Ozyildirim, Director and Global Research Chair at The Conference Board. “Economic growth could exceed 3.5 percent in the second half of 2018, but, unless the momentum in housing, orders and stock prices accelerates, that pace is unlikely to be sustained in 2019.”5 The graphic

4 http://www.sca.isr.umich.edu/ 5 https://www.conference-board.org/pdf_free/press/US%20LEI%20-%20Press%20Release%20OCTOBER%202018.pdf


representation of the Conference Board Leading Economic Index for the U.S. since 1999 is shown in the following graph.

• National level housing sector data indicates some downward pressure and volatility. Starts for both, single and multi-family homes fell sharply, down 0.9 percent for the former and down 2.9 percent for the latter. Weakness was most pronounced in the Midwest and the South. Year-on-year, housing starts increased 3.7 percent while building permits went down 1.0 percent. 6

6 https://tradingeconomics.com/united-states/housing-starts


• The national inflation rate as measured by the U.S. Consumer Price Index for All Urban Consumers (CPI-U) on a year-over-year basis increased 2.3% over the last 12 months, as reported by the U.S. Department of Labor. Shelter index continued to rise while the energy index declined. The graphs below shows monthly CPI changes.

State Economy • The October of 2018 Washington State Economic and Revenue Update from the

Washington Economic and Revenue Forecast Council confirmed that the Washington economy continues to expand and will likely outperform the national economy. Employment, income and population all grew much faster than the corresponding national averages. By September, Washington’s unemployment rate reached an all-time low. The series extends back to 1976. Seattle home prices continued to rise, but growth may be slowing and residential construction is a little softer than was forecasted. The Seattle area consumer price inflation is well above the national average due to higher shelter cost inflation.

• State of Washington General Fund revenues continue to exceed forecast, especially the sales tax revenue, aided by the U.S. Supreme Court Decision on the taxability of online sales.7

Local Economy

• The number of residential permits is the local data equivalent for housing starts. The

activity has been slow on the residential side. The number of houses permitted in 2017 – a total of 177 was the lowest number of single family residences permitting in a given year since 2011. The first half of 2018 paints a much rosier picture of the single family residential market – a total of 271 new houses was permitted with a valuation of $6.2 mil.

7 Washington March Economic & Revenue Update, https://erfc.wa.gov/sites/default/files/public/documents/publications/jul18.pdf


• Following the national trends, the City has seen an increase in the number of multi-family

units permitted within the city limits. The number of new multi-family units permitted in 2013 was 657; roughly double that of 2011 and 2012. In 2014 and 2015, a total of 609 and 705 units were permitted, respectively. In 2017 a total of 1,357 new multi-family units were permitted, more than making up for the sluggish single family residential activity. A total of 699 multi-family units were permitted in the City so far in 2018.


• Activity in the commercial sector has remained strong. A total of 51 commercial projects were permitted in the City of Vancouver through the end of September of 2018, with a total valuation of $112.5 million.

Data provided by the Community and Economic Development Department, City of Vancouver.

• The Portland-Vancouver metro inflation rate is published twice a year by the Bureau of Labor Statistics. The metro inflation rate (CPI-U) for the 12 month period ending in December 2017 was 3.9%.8 Year 2017 was the last year the local CPI reading was taken. Beginning in 2018, Portland metro area did not meet the population criteria and will no longer be tracked. We will report Seattle-Tacoma-Bellevue index that moved in a comparable way to the Portland-Vancouver metro CPI-U.

8 https://www.bls.gov/regions/west/news-release/consumerpriceindex_portland.htm


• According to the Bureau of Labor Statistics, the City’s estimated unemployment rate at the end of June was 4.9%, similar to the county rate and above the estimated unemployment rate of 3.8% in the Portland metro area.

Data provided by the Bureau of Labor Statistics

• Home sales are cyclical, typically increasing in the second and third quarters of the year. Home prices continue to stabilize both nationally and locally, according to the S&P’s Case-Shiller Home Price Index. During the last twelve months, home prices have climbed at about 6 percent in the Portland-Vancouver metro. The Portland metro home prices remain in the record-setting territory, climbing higher than the housing bubble-era prices. .

• The median home value in Vancouver, WA is estimated to be $308 thousand at the end of September, according to Zillow, approximately $10,000 lower than in June. Vancouver home values have increased 8.8% over the past year, but the rate of the increasing is declining.


Local housing prices have likely peaked, and are anticipated to show signs of slowing in the coming months.

III. Financial Results General Fund REVENUES City of Vancouver General Fund revenues for Q3 2018 totaled $118.8 million, exceeding comparable 2017 revenues by $10.8 million. Tax revenues (largely utility, sales, and property taxes) exceeded 2017 collections by a combined amount of approximately $6.8 million. Sales tax collections in 2018 have exceeded comparable 2017 collections by $2.7 million, due to strong auto sales and construction activity.

Following is detailed information on the main revenue sources of the General Fund. Cumulatively, the seven chief sources of revenue listed on the chart below represent more than 83% of the City’s total forecasted General Fund revenues.


0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

Property Tax SalesTax Utility Tax Electrical Tax TelephoneTax

Natural GasTax, BNG

Charges forSvcs.

$25.9 $26.9

$16.9

$6.7

$3.1 $1.8

$4.8

$26.5 $28.6

$20.2

$6.9

$3.2 $2.1

$4.6

$28.0

$31.4

$23.2

$6.9

$2.7 $2.0

$5.0

Milli

ons

of D

olla

rs

General Fund Major Tax Revenue Collections

SEP-16 SEP-17 SEP-18

Note: Utility tax revenue above includes the tax on Solid Waste; Charges for Services exclude the Business License revenue.

Property Tax

• Property tax revenues are typically received during the second and fourth quarters of the

year. The amount of revenue is based on the assessed valuation and is estimated using County Assessor’s data. Deviations from estimates in this revenue source are mostly related to the amount of new construction and delinquency rates.

• By Council action, there was a 1.0% property tax levy increase in 2018, bringing the total City of Vancouver levy rate to $2.611 per $1,000 of assessed value, which was applied to a total taxable value of approximately $21 billion. The General Fund collects $2.32 per $1,000 in assessed value of the total levy. An additional $0.29 levy was approved by voters in November of 2016 for the Affordable Housing Fund. The new levy is generating $6.0 million per year to be dedicated to increasing the number of affordable housing units in the City.

• The City experienced a 23.5% combined reduction in assessed housing valuation between 2009 and 2012. The assessed valuation reduction resulted in an increase of the City’s property tax levy rate, but did not impact revenues. The recessionary drop in assessed valuation has been more than made up during the post recessionary years. The increase in assessed valuation between 2017 and 2018 was 10.7%, but portion of the increase is attributable to a large annexation the City finalized in 2017.

• A total of $28.0 million in property taxes (excluding the Affordable Housing Levy) was

collected through Q3 2018, exceeding third quarter 2017 revenue by $1.5 million. The Affordable housing Levy generated $3.5 million, slightly more than was collected for the comparable period in 2017.


0

5

10

15

20

25

30

35

40

45

50

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Mill

ions

of D

olla

rsQuarterly Property Tax Collections

Forecast Fourth Third Second First

Note: The dollar amounts above represent the General Fund collections of Property Tax. These have not been adjusted for inflation.

Sales Tax

• The 8.4% sales tax rate in the incorporated area is distributed as follows: 6.5% to the State, 0.5% for the City’s “basic” sales tax, 0.3% for the City’s “optional” sales tax, 0.2% for the City restricted to funding Public Safety, the County’s additional optional 0.1% for Law and Justice and 0.1% for addressing the region’s methamphetamine drug addiction and related crime, and 0.7% for C-TRAN.

• Sales tax revenue of $31.4 million was received by the end of September 2018,

approximately $2.7 million more than at the end of September 2017. The fastest growing categories of retail sales were auto sales, construction related activities, and general merchandise. A mild recession is not predicted to occur until late in 2019.

• Growth in taxable retail sales over the last several years was fueled by an improving real

estate market, new construction, and auto sales.


Taxes on Privately Owned Utilities • Vancouver collects a 6.0% utility tax on electrical, natural gas, and telephone services

provided within the incorporated area by entities other than the City. The City also charges cable franchise fees.

• The utility tax on privately owned utilities generated $13.0 million through September

2018, slightly lower than comparable collections in 2017.

o Natural gas tax revenues through September 2018 totaled $2.0 million, approximately $109 thousand less than comparable 2017 collections.

o Telephone tax revenues through the third quarter of 2018 totaled $2.7 million

and were approximately $0.5 million lower than revenues collected during the comparable time period in 2017.

o $6.9 million was collected in electrical tax revenue through the third quarter of

2018, approximately $0.25 million more than comparable 2017 collections.

o The cable franchise fees revenue totaled $1.5 million through September of 2018, slightly less than comparable 2017 collections.


0

5

10

15

20

25

$1.8 $3.1

$6.7

$16.9

$2.1 $3.2

$6.9

$20.2

$1.9 $2.7

$6.9

$23.2 M

illio

ns o

f Dol

lars

Utility and Business Taxes (ThirdQuarter Results)

2016 2017 2018

Water, Sewer, Storm Water and Solid Waste Taxes

• The City Water, Sewer, and Storm Water Utility tax was increased to 24.9% on April 1, 2017 to fund increased Police staffing and related services.

• Before 2010, the City charged a solid waste franchise fee for garbage collection services

to fund Solid Waste fund operations. A portion of the fee, equivalent to approximately a 12.0% tax rate, was deposited into the General Fund for general use. In 2010, the portion of the franchise fee related to general use was converted to a utility tax and levied at the same rate as water, sewer and storm water utilities tax.

• Revenue on city-owned utilities increased due to a growing customer base and underlying rate increases. The underlying water, sewer, and drainage utility rates had inflationary increases in 2017. The rates were also increased to accommodate the additional utility tax for streets and police.

• A total of $23.1 million in City-owned utilities taxes was collected through the third quarter of 2018, $3.0 million more than through the third quarter of last year. The utility tax increase started impacting revenues in the third quarter of 2017, so revenues in the remainder of 2018 are expected to more closely align with the previous year.


0.0

5.0

10.0

15.0

20.0

25.0

30.0

2010 2011 2012 2013 2014 2015 2016 2017 2018

Mill

ions

of

Dol

lars

Quarterly Collections of Utility Taxes on City Owned Utilities (Water, Sewer, Storm Water and Solid Waste)

Forecast Fourth Third Second First

• In 2017, residential water revenues generated approximately 80.0% of total water user

revenues, while residential sewer fee revenues made up 66.0% of total sewer user revenues.

Grant & Entitlement Revenues

• The City anticipates receiving $1.4 million in grants in the General Fund in 2018. The largest grants are the COPS grant that partially funds additional Police staff, and the Brownfield and Commute Trip Reduction grants in the Community and Economic Development department.

• Through the end of Q3 2018, the City received approximately $409 thousand in grant reimbursements. Most grants are cost-reimbursable, with the majority of the reimbursement funding coming in during the second through fourth quarters of the year.

Charges for Goods and Services

The largest fee-revenue generating program areas at the City are the Development Review Services and Recreation programs. The Q3 2018 revenue generated by these two sources is $4.2 million.

Land Use and Other Planning Permits

• From 2008 through 2010, the City experienced a significant decrease in both the number of single family residential permits issued and in their valuation. Collections from 2011 through 2013 remained relatively flat, but 2014 through 2016 saw significant annual increases in land use fees. Similar trends continued into 2017 and are expected to


continue in 2018. So far, land use fees generated $890 thousand in revenue compared to $806 thousand generated over the same period of time last year.

Recreation Program Fees

• The City anticipates receiving $4.2 million in recreation fees in 2018. Revenues are anticipated to be higher than 2017, when one of the two recreation centers underwent a major swimming pool renovation and a portion of the center was closed to customers longer than originally anticipated.

• The total recreation fee revenue received through the end of September was $3.3 million; approximately $224 thousand higher than comparable revenues in 2017.

EXPENDITURES

• General Fund expenditures in Q3 2018 totaled $110.4 million, or 63% of the year’s budget after the appropriation carry-forward and first supplemental budget process took place.

• Departments in the General Fund spent $59.6 million, $2.4 million more than was spent through the end of the third quarter 2017. The spending resulted from broadly increased departmental costs and new Police staffing.

• Expenses vs. budget by category within the General Fund are shown in the following

chart.


• General Fund salaries and benefits expenditures totaled $39.8 million through September of 2018, or 70% of the budget for the year.

• General Fund supplies and services category expenditures were $10.2 million, or 54% of the budget.

• Intergovernmental expenditures include payments by the City to other jurisdictions based on inter-local agreements, and internal transfers supporting other funds, such as the Debt Fund, Fire Fund, and Street Fund. Intergovernmental expenditures reached $44.3 million through the third quarter of 2018, or 58% of the budget for the year. The City has only made one quarterly payment for Jail services this year due to delays in billing.

• Internal expenditures were $11.1 million, or 73% of the budget for the year. Beginning in

2015, the cost of the internal services departments (such as IT, HR, Finance and General Services) is proportionately reflected in the respective budgets of the direct service departments.

• Capital expenses totaled $5.0 million and are mostly reflective of the City purchasing the Grand Boulevard property for the purpose of providing day center services to Vancouver residents who are experiencing homelessness.

Cash Balance

• The General Fund operating cash balance was $53.3 million at the end of September 2018. The balance was $8.4 million more than the cash balance at the end of September 2017, largely due to the difference in transfers between funds.

• In addition to the operating cash balance, the General Fund had an emergency reserve totaling $11.8 million at the end of September 2018, compared to $11.5 million in September 2017. The Council updated the emergency reserve balance financial policy in 2012, requiring that the emergency reserve balance equals 7.0% of actual external revenues in the preceding fiscal year for the General, Street, and Fire Funds. These funds are intended to be used only for extraordinary events, such as natural disasters.

Fund Balance • The cash balance represents a snapshot at a particular point in time, while the fund

balance factors in revenues and expenditures that are anticipated to occur by the end of the year.

• The total fund balance in the General Fund at the end of 2017 was $59.6 million, according to the very preliminary City’s unaudited financial statements. The balance is composed of the Restricted, Committed, Assigned, and Unassigned balances. The Restricted balance of $0.02 million represents grant revenue received in advance of expenditures in VPD. The Committed balance of $21.7 million represents reserves in


accordance with the City Financial Policies including the City Emergency reserve of $11.6 million, Revenue Stabilization reserve of $3.8 million, and capital reserve of $6.3 million. The balance pays for the ongoing operations of the General Fund when incoming seasonal revenues are not sufficient to cover expenses, and eliminates the need for short-term borrowing. The Assigned reserve of an estimated $35.8 million represents the City’s $31.6 million working capital, which is required to ensure sufficient cash flow in the fund. The Assigned balance also includes $4.0 million representing funding for 50% of accrued compensated absences. The remaining $9.8 million portion of the balance was determined to be undesignated at the end of 2017. Approximately $4.5 million of the 2017 appropriation was carried forward and used the corresponding fund balance.

Street Fund • Street Fund expenditures in Q3 2018 totaled $11.4 million, or 73% of the budget,

approximately $244 thousand less than comparable expenditures in 2017. • Street Fund revenues (excluding a budgeted general fund transfer) totaled $4.1 million, less

than the comparable collections in 2017 by approximately $2.5 million. The fund’s largest sources of revenue are state-shared revenues from the motor vehicle fuel tax (MVFT), the real estate excise tax (REET), and a transfer from the General Fund. Beginning in 2018, REET revenue is being received by the Operating Street Initiatives Fund to better match the consolidated Pavement Management Program which was moved to the same fund for the ease of operations.

• Motor Vehicle Fuel Tax (MVFT) revenues totaled $2.8 million through the third quarter of

2018, slightly exceeding those in 2017. This revenue source is a set tax per gallon that does not depend on the price of gasoline. The significant nation-wide increase in gasoline prices over the past two years has resulted in declining gasoline consumption. The decline in consumption negatively impacted tax revenue collections state-wide and decreased the proportionate share of the tax received by the City.


Real Estate Excise Tax (REET)

• A Real Estate Excise Tax (REET) of one-quarter of 1.0% of the selling price is imposed on each sale of real property in the corporate limits of the City. The tax used to be deposited into the Street Fund, but beginning in 2018 is deposited into the Street Initiative fund and is restricted to financing preservation of the City’s street system. The City also collects an additional one-quarter of 1.0% of the selling price in REET for Parks and Transportation capital.

• REET revenue increased rapidly in 2004-2006, fueled by a favorable real estate market and

increasing home prices. REET revenues declined significantly through 2010 after the housing bubble in 2005 and 2006. Since 2011, collections have been increasing. Real estate activity remains very upbeat. In 2017, the revenue exceeded the pre-recession years

• A total of $1.7 million in REET revenue was received in Q3 2018, approximately $0.3 million

less than comparable collections in 2017. The graph below demonstrates the fluctuations in REET collections since 2005. The real estate market is anticipated to start cooling off in the later part of 2018, resulting in a lower forecast for the year.


Street Funding Initiative • During 2015, an extensive, six-month long public process took place to determine the desired

level of services in the city street and right-of-way maintenance program and what additional funding sources would be most appropriate to fund any desired enhancements in the service level. The recommendations prepared by the Commission on the desired service level and funding were accepted and acted upon by City Council, resulting in new/increased revenues being directed to Streets to fund the desired operating and capital outcomes. The ultimate anticipated outcomes of this initiative are, among other things, an improvement in the condition of City streets from the current “fair” to “good” over a period of twenty years, reconstruction of a major arterial every two years, and improved maintenance of right-of-ways. Following is a link to the specific set of recommendations: http://www.cityofvancouver.us/sites/default/files/fileattachments/public_works/page/12554/streets_funding_commission_recommendation_final.pdf

• 2016 was the first year of the new Street Initiatives revenue. The City pre-funded the activities

related to right-of-way maintenance with City dollars so that some of the results could be seen in 2016. A portion of the new revenue - vehicle license fees – started coming into the Transportation Benefits District (TBD) beginning July 1, 2016.

Below is the financial information related to the Operating Street Initiatives and the Capital Street Initiatives funds. Attachment B to the Quarterly report further breaks down revenues received by the Street Funding Initiative – Operating fund by type of revenue

2017 2017 % 2018 2018 %Revenues Actuals September Budget Budget September Budget Street Initiative Operating Fund 4,699,497 3,423,571 73% 10,818,243 7,819,391 72%

Street Funding Initiative - Capital Fund 1,134,914 1,048,457 92% 2,128,722 1,327,334 62%

Transportation Benefits District 1,425,491 667,205 47% 1,604,480 1,135,617 71%

ExpendituresStreet Initiative- NEW Fund 3,866,182 3,333,746 86% 11,106,059 6,336,498 57%Capital Streets Initiative Fund (NEW) 352,747 180,554 51% 3,058,700 537,152 18%

Transportation Benefits District 1,731,165 1,498,374 87% 2,855,539 2,254,154 79%


Consolidated Fire Fund

• The City has an Operating Fire Fund and a Capital Fire Fund. The Capital Fire Fund largely funds vehicle replacements and purchases. The Operating Fire Fund fully supports the Capital Fire Fund. The graph below represents the operating fund’s financial information.

• Operating Fire Fund revenues in the third quarter of 2018 were $1.2 million (exclusive of General Fund support, the Fire District 5 transfer and the transfer between Fire Operating and Capital), mostly representing permit and inspection fees, as well as grants.

• Total Fire Operating expenditures in third quarter of 2018 were $31.1 million, 73% of the budget for the year, comparable to those in 2017.

Building Inspection Fund

• Building review and inspection fee revenues received in the third quarter of 2018 totaled $4.7 million, $0.5 million higher than those received in the same period in 2017.

• Building Fund expenditures in Q3 2018 totaled $4.2 million, approximately $0.5 million higher than in Q3 2017.

• The fund balance in the Building fund targets funding for 18 months of permitting activity after revenue is collected. The projected fund balance at the end of 2018 can cover less than 12 months of permitting activity.


Parking Fund

• Fee and fine revenues through September 2018 were $3.3 million, approximately $1.0 million higher than those during the comparable period of 2017. Hourly and monthly parking rates were increased across the parking system in 2018.

• Operating expenses through Q3 2018 totaled $2.4 million, or 58% of the budget for the year, comparable to those in 2017. Expenditures are anticipated to come on budget by the year end.

Utility Operations • Operating transfers between the Water, Sewer and Storm Water funds are included in

the accompanying Attachment A, per budget requirements. These transfers are generally eliminated when financial statements are prepared. Financial statements for utility funds are prepared on a quarterly basis. Please call (360) 487-8441 to receive a copy of the detailed financial statements for the Utility Funds.

Water

• Water sales revenues totaled $28.1 million through September 2018, or 73% of the annual forecast. Collections were $2.4 million above comparable 2017 collections, largely due to the inflationary rate increases and the 3.4% utility tax increase to fund additional staffing in police (effective April 1, 2017).

• Water fund expenditures through Q3 2018 totaled $25.7 million, or 54% of the 2018 budget, approximately $939 thousand higher than those in Q3 of 2017.


Sewer • Fee revenues in the Sewer Fund were $34.4 million through Q3 2018, approximately $1.6

million above comparable 2017 revenues. Sewer rates had inflationary increases in 2017 and an adjustment for a 3.4% utility tax increase to fund increased police staffing.

• Sewer expenditures through Q3 2018 totaled $28.9 million, slightly less than the 2017

comparable expenditures.

Storm Water • A total of $12.5 million in storm water fee revenue was received through Q3 2018,

approximately $1.5 million higher than 2017 comparable revenues. In 2017, the rates had an inflationary increase as well as an adjustment for a 3.4% utility tax increase to fund increased police staffing.

• Overall, the expenditures in the Storm Water fund were $10.8 million through Q3 2018, or

65% of the overall 2018 budget, approximately $0.3 million lower than comparable 2017 expenses.

Internal Service Funds

Equipment Services Operating and Capital Funds

• A total of $5.2 million was spent by Equipment Services on operating activities through Q3 2018, or 70% of the budget for the year. The ER&R Capital fund spent $2.0 million by the end of September 2018, or 28% of the budget for the year due to continued delays in purchases of new and replacement vehicles.

Technology ER&R Fund

• A total of $4.2 million, or 72% of the budget, was spent on technology and software

replacement through September 2018. A large portion of the $5.9 million 2018 budget is earmarked to replace the City’s 17-year old ERP System, Oracle. The project is expected to continue through the end of 2018.

Internal Administrative Services Fund

• $10.1 million, or 67% of the budget, was spent by Internal Services departments (IT,

Finance, HR and General Services) through Q3 2018, approximately $88 thousand higher than was spent through Q3 2017.

Risk Fund • A total of $2.7 million was spent through Q3 2018, or 51% of the budget, slightly higher

than $1.9 million spent through Q3 2017 largely driven by settled claims.

Benefits and Self Insured Health Insurance Funds • A total $14.5 million was spent through the third quarter of 2018 on employee benefits,

including health insurance and payments to medical trusts, approximately $1.7 million more than was spent last year over the same time period. The amount spent represents


76% of the budget for the year. There will be a need to adjust the budget in the Self Insured Health Insurance fund in the last supplemental to reflect higher claims level than was anticipated in the budget.

IV. Outstanding Debt

• At the end of the third quarter of 2018, the City had around $75.1 million of general

obligation (G.O.) debt outstanding and approximately $7.5 million of revenue bond debt outstanding. General obligation debt is backed by the full faith and credit of the City and by general taxes. Revenue bond debt is supported by a pledge of specific revenues. All of the City’s revenue bond debt is supported by the City’s water and sewer utilities. The weighted-average interest rate for the City’s general obligation debt is 3.09%, while the average interest rate for the City’s revenue bond debt is 4.00%.

A complete list of the City’s outstanding debt is included in Attachment C.

V. Investments

Market Conditions • Information received since the Federal Open Market Committee met in August indicates

that the labor market has continued to strengthen and that economic activity has been rising at a strong rate. Job gains have been strong, on average, in recent months, and the unemployment rate has stayed low. Household spending and business fixed investment have grown strongly. On a 12-month basis, both overall inflation and inflation for items other than food and energy remain near 2 percent. Indicators of longer-term inflation expectations are little changed, on balance.

• Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective over the medium term. Risks to the economic outlook appear roughly balanced.

• In view of realized and expected labor market conditions and inflation, the Committee

decided to raise the target range for the federal funds rate to 2 to 2-1/4 percent.

• The overall yield curve increased during the third quarter of 2018. The yield on the three-month Treasury has increased to 2.19% at the end of the third quarter. The six-month Treasury yield has increased to 2.36%. The yield on the two-year Treasury has increased to 2.81%. The thirty-year Treasury yield increased, ending the third quarter at 3.19% from 2.98%. Market risk of the City’s portfolio is low. The average maturity of the portfolio has been kept below one year. The investment maturities are expected to meet the cash flow needs of the city and it is unlikely that an investment would have to be liquidated before maturity to meet the city cash flow needs.

• The City complies with State statutory guidelines and the City’s investment policies that limit the types of securities purchased. These consist of U.S. Treasury securities, federally-backed agency securities, and other relatively risk-free investments. The City does not leverage its portfolio nor does it invest in derivatives.


Investment Performance The average amount invested during the third quarter of 2018 was $338 million compared to $317 million on September 2017. The portfolio had a weighted average yield of 1.44% year-to-date, which is 56 basis points lower than the projected annual yield of 2.0% for 2018. The projected yield is based upon the blended yield between existing rates and expected market rates when new investments are purchased during the year. The year-to-date yield is 33 bps lower than the State Investment Pool, which had an average yield of 1.77%. The State Pool has a weighted average maturity of 31 days. The City’s investment portfolio weighted average maturity is approximately 7 months. Longer-term portfolio yields will underperform shorter-term portfolio yields in a rising interest rate environment. Interest revenue distributed through the third quarter of 2018 to all funds is approximately $3.63 million compared to $2.49 million during the same period of 2017. The City’s investment portfolio profile is detailed in Attachment D.


VI. Interfund Loans In 2003, Council passed an ordinance giving the City Treasurer the authority to make interfund loans to meet the short term liquidity and cash flow needs of the City’s various funds. The ordinance requires the City Treasurer to provide a quarterly report to City Council showing the amount of all interfund loans outstanding and the repayment plan for those loans. During 2018 there was only one interfund loan. No interfund loans were outstanding at the end of September 2018.

Balance InterestOutstanding Interest Expense

Fund Description 09/30/18 Lending Fund Rate Paid in 2018 Repayment Plan

001 1.63% 61.51$

Timing delay of receiving grant proceeds after expenditures have been paid.

Total Outstanding Interfund Loan Balance -$


A A B ARANGE NAME ADJ-17 SEP-17 ADJ-18 SEP-18ATTACHMENT A 2017 2017 % of 2018 2018 % ofExpenditures December September YE Budget September BudgetGENERAL FUNDCity Council 626,481 418,909 67% 661,652 391,359 59%City Manager's Office 3,062,321 2,282,782 75% 3,334,492 2,329,150 70%Econ. Dev.: Real Estate operating 26,147 392 2% - 3,861 n/aLegal Services 4,918,084 3,674,830 75% 5,650,877 3,851,236 68%Community Economic Development 5,641,806 4,208,238 75% 8,216,388 4,507,044 55%Parks, Trails, & Natural Resources 1,940,356 1,495,942 77% 2,098,630 1,399,839 67%Recreation Services 7,999,281 6,136,190 77% 8,735,324 6,292,196 72%Police 44,855,748 33,093,097 74% 50,532,108 34,767,250 69%Grounds Maintenance 4,422,063 3,167,552 72% 4,557,936 3,052,473 67%Facilities Maintenance 3,566,461 2,620,084 73% 4,247,606 2,992,841 70%

Subtotal Non-Gen. Governmental 77,058,748 57,098,016 74% 88,035,012 59,587,249 68%General Governmental

Child Justice Center Support 420,360 315,270 75% 382,085 315,270 83%City Cable Programming 511,524 383,643 75% 549,150 402,458 73%Fire District #6 23,254 23,235 100% 22,000 26,837 122%Emergency Mgmt (CRESA) 162,474 162,474 100% 161,106 127,008 79%Air Pollution Control Authority 55,832 55,832 100% 74,605 74,305 100%Humane Society 299,220 222,470 74% 290,000 218,655 75%Animal Control 320,560 240,420 75% 255,000 111,829 44%Alcoholism Support 46,401 23,141 50% 40,000 24,283 61%Regional Transp Council 45,623 45,623 100% 45,700 45,623 100%Election Support 327,393 - 0% 200,000 - 0%AWC, Chamber of Commerce Memberships 75,880 86,484 114% 80,818 80,778 100%Opportunity Reserve 85,819 26,646 31% 173,580 119,457 69%Miscellaneous 2,105,953 182,138 9% 530,145 416,050 78%Real Estate Transactions 8,541,648 5,421,987 63% 7,746,111 5,929,654 77%Public Defender 1,272,574 1,057,552 83% 1,457,586 954,669 65%County Jail Costs 3,147,138 4,869 0% 4,716,373 375,404 8%County Corrections Costs 1,353,002 913,878 68% 1,138,483 915,224 80%County District Court Costs 1,063,855 537,369 51% 1,202,000 618,065 51%General Obligation Debt Payment 4,866,360 649,741 13% 5,715,950 553,548 10%General Govt Support 5,842,701 4,727,220 81% 13,847,306 3,313,360 24%Street Support (formerly in General Support) 13,710,998 10,257,047 75% 14,053,055 10,754,808 77%Fire Support (formerly in General Support) 29,055,828 21,334,488 73% 30,251,468 23,245,867 77%LEOFF Pension Support (formerly in General Supp 2,900,004 2,175,003 75% 2,900,000 2,175,001 75%

Subtotal General Govermental 76,234,403 48,846,531 64% 85,832,521 50,798,153 59%Total General Fund 153,293,150 105,944,547 69% 173,867,533 110,385,402 63%

SPECIAL REVENUE FUNDSStreet 19,862,476 11,653,080 59% 15,679,996 11,409,362 73%Street Initiative- NEW Fund 3,866,182 3,333,746 86% 11,106,059 6,336,498 57%Fire Operating Fund 42,041,304 31,114,531 74% 42,578,286 31,131,472 73%Fire Capital Fund 1,275,706 1,209,577 95% 2,029,454 791,801 39%AMR Compliance Fund (New) 532,217 278,666 52% 772,990 559,861 72%Drug Enforcement and Investigative Funds 325,674 160,445 49% 453,966 193,617 43%Community Development Block Grant 1,864,394 1,330,477 71% 2,136,190 1,953,236 91%Tourism 1,959,614 1,331,499 68% 1,907,696 1,251,357 66%Affordable Housing 282,857 30,982 11% 11,661,156 1,481,672 13%Criminal Justice/LLEBG 630,818 494,296 78% 289,971 60,675 21%Real Estate Excise Tax - I 3,242,362 1,650,431 51% 3,776,586 1,958,628 52%Transportation Special Revenue 2,376,154 519,902 22% 3,376,484 542,492 16%


ATTACHMENT A 2017 2017 % of 2018 2018 % ofExpenditures December September YE Budget September BudgetParks & Recreation Special Revenue 22,326 15,088 68% 37,208 29,631 80%Downtown Initiatives 150,027 87,826 59% 135,003 96,013 71%VNHR Properties 574,178 229,770 40% 656,382 170,700 26%Senior Messenger 262,458 189,189 72% 357,151 215,535 60%TIF Funds 678,257 137,635 20% 2,454,495 1,721,369 70%PIF Funds 1,425,971 1,011,028 71% 9,095,199 21,938 0%

DEBT SERVICE FUNDSG O Debt Service Fund 10,353,676 1,954,607 19% 11,237,966 1,799,772 16%L I D Debt Fund 39,925

CAPITAL FUNDS2011 Bond Capital Fund - Waterfront 715,757 186,899 26% 3,317,262 1,004,658 30%Transportation Capital Fund 16,251,261 10,267,542 63% 22,233,706 4,385,603 20%Capital Streets Initiative Fund (NEW) 768,094 180,554 24% 3,058,700 537,152 18%Fire Acquisition Fund 11,281,314 7,890,524 70% 3,458,089 1,216,117 35%Capital Improvement Fund 6,392,322 5,369,244 84% 4,514,901 1,673,146 37%VNHR Property Capital 4,735,264 4,539,932 96% 221,893 - 0%2015 Bond Capital Fund - VNHR (New) 41,181 41,181 - - Parks Construction Fund (Capital Projects only) 11,216,239 5,621,412 50% 22,199,485 9,205,575 41%City Tree Reserve Fund 35,715 16,639 47% 45,679 21,398 47%Drainage Construction Fund 758,683 600,328 79% 4,574,799 242,174 5%Systems Development Reserves 6,750,000 - 0% 3,750,000 - 0%Water Construction Fund 13,154,853 7,982,017 61% 25,939,108 6,976,609 27%Utility Customer Assistance 16,882 1,846 30,000 8,969 Water Revenue Bond Debt Service Fund 14,376 97,603 679% 103,909 100,163 96%Sewer Revenue Bond Debt Service Fund 887,996 7,178,197 808% 7,549,805 7,366,299 98%Sewer System Development 6,269,670 - 0% 2,800,000 - 0%Sewer Construction Fund 6,526,165 4,326,939 66% 17,034,879 4,086,922 24%

ENTERPRISE FUNDSStorm Water 16,070,601 11,115,346 69% 16,723,504 10,833,078 65%Water 43,189,529 24,750,229 57% 47,390,401 25,689,685 54%Sewer 54,405,870 29,162,771 54% 53,932,071 28,945,606 54%Building Inspection 5,193,758 3,747,631 72% 6,142,922 4,196,434 68%Solid Waste 2,783,228 1,732,695 62% 2,997,998 1,958,739 65%Parking 2,871,993 2,076,871 72% 4,187,765 2,425,476 58%Tennis Center 1,141,737 863,510 76% 2,110,821 1,281,946 61%Airpark 835,686 662,228 79% 1,354,115 439,259 32%

INTERNAL SERVICE FUNDSFacilities Asset Mgmt & Replacement Reserve Fun 4,647,863 592,458 13% 3,846,674 166,208 4%Equipment Services Operations Fund 6,802,945 4,788,847 70% 7,463,833 5,200,808 70%Equipment ER&R Capital 2,779,567 1,318,672 47% 7,379,911 2,048,865 28%Technology ER&R 3,076,233 1,683,050 55% 5,853,478 4,210,724 72%Risk Fund 5,450,028 1,942,636 36% 5,276,044 2,685,879 51%Internal Administrative Services Fund (New) Finance 5,260,780 3,840,011 73% 6,170,230 3,967,567 64% Information Technology 5,755,360 4,569,128 79% 6,603,717 4,716,347 71% Human Resources 1,761,318 1,360,534 77% 2,194,124 1,332,717 61% General Services 272,995 206,719 76% 90,240 47,890 53%Benefits Fund 10,680,134 7,951,328 74% 11,953,850 8,410,995 70%Self Insured Health Insurance (New) 7,208,700 4,849,550 67% 7,105,927 6,090,032 86%


ATTACHMENT A 2017 2017 % of 2018 2018 % ofExpenditures December September YE Budget September Budget

AGENCY FUNDSSWAT Team 233,179 107,284 46% 376,689 316,190 84%Police Pension 950,845 719,687 76% 1,091,440 683,255 63%Fire Pension 1,350,785 917,342 68% 1,810,973 978,182 54%Cable TV 1,158,760 895,162 77% 1,387,702 817,901 59%PEG 645,581 228,489 35% 1,090,488 279,665 26%Transportation Benefits District (NEW) 1,731,165 1,498,374 87% 2,855,539 2,254,154 79%Notes

2. Operating transfers between funds are included within this report.

1. This report was prepared using the methodology prescribed under the basis of budgeting, depreciation, appreciation costs have been excluded

3. In 2015, Finance, Information Technology, Human Resources and General Services moved from General Fund to an Internal Administrativce Services Fund.


SEP-17 SEP-18A A B A

ATTACHMENT B DEC-17 SEP-17 SEP-18 SEP-18Revenues 2017 2017 % of 2018 2018 % of

Actual September YE Budget September BudgetGENERAL FUNDTax Revenue

Property Tax 45,935,186 26,532,570 58% 48,737,924 28,000,602 57%Sales Tax 39,069,501 28,609,279 73% 39,220,947 31,356,219 80%Electrical Tax 8,219,294 6,875,616 84% 8,558,165 6,900,598 81%Natural Gas 2,506,760 2,065,283 82% 2,941,179 1,956,383 67%Telephone 4,099,506 3,191,060 78% 3,834,355 2,690,447 70%Cable Franchise Fee 2,303,128 1,600,829 70% 1,910,713 1,493,061 78%Water/Sewer/Storm Water 22,597,417 16,748,246 74% 25,482,418 18,767,150 74%Solid Waste Utility Tax 4,822,171 3,403,670 71% 5,776,054 4,424,815 77%Gambling and Leasehold Taxes 664,342 493,407 74% 657,823 502,988 76%

Subtotal Tax Revenue 130,217,305 89,519,959 69% 137,119,577 96,092,262 70%Business Licenses 1,794,748 1,308,817 73% 2,088,835 1,500,239 72%Grants & Entitlements 747,203 378,893 51% 1,397,873 408,766 29%State Shared Revenues 3,804,352 3,143,366 83% 3,675,196 3,499,753 95%Parks Contract with Clark County 125,694 95,204 76% 75,000 53,910 72%Charges for Services

Planning Permits 790,370 806,714 102% 876,285 890,852 102%Recreation Program Fees 3,926,510 3,122,918 80% 4,229,884 3,346,714 79%Interfund Service Charges 4,930,805 3,621,652 73% 5,265,860 3,988,989 76%Other Charges & Services 979,195 705,611 72% 1,511,817 762,147 50%

Subtotal Charges for Services 10,626,880 8,256,895 78% 11,883,846 8,988,702 76%District Court 2,113,073 1,570,811 74% 2,461,828 1,700,124 69%Miscellaneous 1,213,900 955,767 79% 784,981 1,263,579 161%Lease Revenue (short and long-term) 3,267,597 2,314,952 71% 2,281,629 3,029,476 133%Operating Transfers 949,916 523,969 55% 4,044,007 2,280,020 56%

Total General Fund 154,860,668 108,068,633 70% 165,812,773 118,816,831 72%

SPECIAL REVENUE FUNDSStreet Fund

Real Estate Excise Tax 4,452,187 3,125,900 70% - 254,618 n/aMotor Vehicle Fuel Tax 3,628,148 2,651,932 73% 3,735,316 2,782,862 75%Permits and Misc. 1,362,197 841,889 62% 1,147,026 1,072,175 93%Operating Transfers 11,266,306 8,302,295 74% 8,716,019 7,180,682 82%

Total Street Funds 20,708,839 14,922,017 72% 13,598,361 11,290,336 83%

Operating Street Inititative FundReal Estate Excise Tax - - n/a 2,885,531 2,490,040 86%Motor Vehicle Fuel Tax and Misc. 178,259 133,220 75% 2,208 201,314 n/a Business License Surcharge 453,519 340,622 75% 1,000,000 648,473 65%Operating Transfers 3,721,981 2,724,212 73% 6,577,513 4,119,543 63%Total Operating Street Initiatives Fund 4,353,759 3,198,054 73% 10,465,252 7,459,371 71%

Operating Fire FundService Charges-Fire Dist. #5 9,574,179 5,015,236 52% 8,800,220 4,491,298 51%Grant Revenue 356,690 287,327 n/a 310,435 59,536 n/aPermit/Other Fees and Misc 1,891,016 1,150,930 61% 1,926,312 1,126,275 58%Operating Transfers 29,210,437 21,334,488 73% 30,663,280 23,398,281 76%

Total Operating Fire Fund 41,032,322 27,787,980 68% 41,700,247 29,075,391 70% Fire Equipment Fund 1,188,983 799,441 67% 1,128,042 847,900 75%

AMR Compliance Fund (New) 752,215 631,272 84% 681,000 669,354 98%



Actual September YE Budget September BudgetOther Special Revenue Funds

Drug Enforcement 226,356 184,567 82% 124,900 232,980 187%Community Development Block Grant 1,679,259 1,379,971 82% 2,009,297 1,815,970 90%Tourism 2,485,292 1,762,388 71% 1,790,521 1,802,271 101%Affordable Housing 5,961,121 3,478,180 58% 6,000,000 3,505,219 58%Criminal Justice/LLEBG 264,019 195,692 74% 245,764 207,815 85%

Transportation Special Fund 2,554,322 1,981,376 78% 2,610,000 1,784,556 68%Real Estate Excise Tax - I 3,811,141 2,983,210 78% 3,413,189 2,615,945 77%Parks & Recreation Special Revenue Fund 32,100 15,296 48% 15,200 23,119 152%Downtown Initiatives 186,032 136,549 73% 179,248 148,138 83%VNHR Properties 758,063 215,224 28% 573,713 217,928 38%Senior Messenger 250,476 188,539 75% 287,000 238,807 83%TIF Funds 2,668,499 1,883,188 71% 1,794,796 2,005,735 112%PIF Funds 2,601,654 1,753,711 67% 1,246,000 1,794,802 144%Parkhill Cemetery Fund 21,636 18,489 85% 17,500 22,064 126%

DEBT SERVICE FUNDSG O Debt Service Fund 10,353,676 1,954,607 19% 11,237,965 1,799,772 16%L I D Fund 6,335 6,182 27,000 1,004 CAPITAL FUNDS2011 Bond Capital Fund - Waterfront 44,114 32,195 n/a - 34,028 n/aTransportation Capital Fund 15,026,900 6,996,878 47% 19,252,938 4,538,586 24%Capital Streets Initiative Fund (NEW) 1,134,914 1,048,457 92% 2,128,722 1,327,334 62%Capital Improvement Fund 4,830,211 3,003,387 62% 4,292,414 628,103 15%Fire Acquisition Fund 3,194,644 738,698 23% 11,172,847 5,301,095 47%VNHR Property Capital 1,272,031 1,269,746 100% - 7,302 n/aParks Construction Fund (Capital Projects only) 7,313,121 3,813,838 52% 17,399,183 3,329,007 19%City Tree Reserve Fund 83,351 51,131 61% 30,000 100,800 336%Drainage Construction Fund 6,430,754 2,017,309 31% 3,275,295 64,210 2%Water/Sewer Capital Reserves 33,609 23,730 71% 14,000 34,444 246%Systems Development Reserves 3,363,175 2,685,827 80% 3,265,000 3,779,097 116%Water Construction Fund 20,509,027 1,963,528 10% 14,686,249 464,763 3%SCIP Fund (16,770) 408,617 -2437% 685,000 818,730 120%Utility Customer Assistance 17,059 (3,855) n/a 13,000 6,420 n/aWater Revenue Bond Debt Service Fund 104,249 85,545 82% 103,909 86,060 83%Sewer Revenue Bond Debt Service Fund 7,580,124 6,233,579 82% 7,559,805 6,267,821 83%Debt Service Reserves 2,014,315 14,509 1% 8,200 42,520 n/aSewer System Development 3,342,671 2,602,992 78% 3,210,000 4,264,821 133%Sewer Construction Fund 13,331,900 1,114,853 8% 5,800,000 97,868 2%ENTERPRISE FUNDSStorm Water

Storm Drainage Fees 14,734,698 10,772,040 73% 17,462,624 12,080,220 69%Private Capital Contributions - - - 136,846 Miscellaneous 331,216 249,315 75% 244,079 295,868 121%

Total Storm Water Fund 15,065,914 11,021,355 73% 17,706,703 12,512,934 71%Water

Residential Water Sales 27,259,902 20,603,882 76% 31,665,198 22,357,203 71%Commercial Water Sales 5,459,866 4,082,282 75% 5,797,160 4,549,446 78%Governmental Water Sales 1,223,407 985,312 81% 1,108,251 1,167,959 105%

Subtotal Water Sales 33,943,175 25,671,476 76% 38,570,609 28,074,607 73%Private Capital Contributions 2,459,156 1,406,518 n/a 240,000 1,478,701 n/aInterfund Transfers 2,733,467 33,323 1% 3,055,330 976 0%Indirect Cost Plan Revenue 1,891,970 1,412,604 75% 2,064,677 1,438,029 70%Miscellaneous 2,152,069 1,605,086 75% 1,918,071 1,620,907 85%

Total Water Fund 43,179,836 30,129,008 70% 45,848,687 32,613,220 71%Sewer

Residential Sewer Charges 29,234,944 21,710,797 74% 33,015,551 23,147,330 70%Commercial, Industrial Sewer Charges 12,871,260 9,771,274 76% 12,498,759 9,963,613 80%Governmental Sewer Charges 1,990,630 1,272,508 64% 1,299,395 1,287,717 99%

Subtotal Sewer Charges 44,096,834 32,754,579 74% 46,813,705 34,398,661 73%Private Capital Contributions 404,666 264,242 65% 150,000 1,049,135 699%Interfund Transfers 6,269,670 - 0% 3,300,000 - 0%Miscellaneous 922,249 666,911 72% 1,228,354 523,792 43%



Actual September YE Budget September BudgetTotal Sewer Fund 51,693,419 33,685,732 65% 51,492,059 35,971,588 70%

Building InspectionPermits 3,719,143 2,694,628 72% 4,303,600 4,377,049 102%Miscellaneous 203,094 155,344 76% 163,773 134,745 82%Interfund Services 313,797 216,209 69% 417,620 253,481 61%

Total Building Fund 4,236,034 3,066,182 218% 4,884,993 4,765,276 245%Solid Waste

Solid Waste Utility Tax 1,204,395 897,866 75% 1,270,132 953,581 75%Service Charges-Recycling 529,057 112,472 21% 635,581 257,050 40%Miscellaneous 156,521 42,951 27% 43,226 55,197 128%

Total Solid Waste Fund 1,889,973 1,053,290 56% 1,948,939 1,265,827 65%Parking

Parking Fines 574,954 400,235 70% 532,000 992,410 187%Parking Meters & Lots 2,593,769 1,880,525 73% 3,662,309 2,289,337 63%Miscellaneous 122,670 106,305 n/a 35,300 (12,734) n/aOperating Transfers 500,629 - - -

Total Parking Fund 3,792,023 2,387,066 63% 4,229,609 3,269,013 77%Tennis Center

Membership Fees 731,431 559,257 76% 822,000 459,546 n/aInstruction and Miscellaneous 15,607 11,604 74% 24,000 9,849 n/aOperating Transfers 323,009 161,505 50% 1,217,009 946,854 78%

Total Tennis Center Fund 1,070,048 732,365 68% 2,063,009 1,416,249 69%Other Enterprise Funds

Pearson Airfield 861,841 578,022 67% 1,438,723 532,514 37%Utility Customer Assistance 17,059 (3,855) n/a 13,000 6,420 n/a

INTERNAL SERVICE FUNDSFacilities Asset Mgmt & Replacement Reserve Fund 4,636,553 3,278,880 71% 1,639,805 1,319,609 80%Equipment Services Operations Fund 6,649,556 4,640,158 70% 6,859,886 5,016,372 73%Equipment Services Capital Fund 4,979,827 3,122,773 63% 3,689,876 2,606,075 71%Computer Repair & Replacement 2,899,283 2,110,316 73% 3,015,230 2,213,165 73%Self-Insured Worker's Comp & Liability Fund 6,166,525 4,586,958 74% 6,023,717 4,657,004 77%Internal Administrative Services Fund 15,940,041 10,918,514 68% 16,365,068 11,531,265 70%Benefits Fund 10,430,290 7,745,851 74% 10,442,056 7,996,827 77%Self-Insured Health Insurance Fund 7,435,331 5,494,600 74% 7,210,634 5,720,619 79%Mail Services Fund - - n/a - - n/aAGENCY FUNDSSWAT Team 257,891 231,695 90% 311,065 312,778 101%Police Pension 1,106,022 887,033 80% 1,100,000 837,868 76%Fire Pension 2,083,653 1,546,106 74% 2,038,228 1,661,370 82%Cable TV 1,259,797 781,106 62% 1,280,243 928,330 73%PEG 577,225 573,080 99% 788,064 556,456 71%Notes1. This report was prepared using the methodology prescribed under the basis of budgeting.2. Operating transfers between funds are included within this report.


City of VancouverOutstanding Debt - General Obligation BondsThird Quarter 2018

True FinalIssue Original Issue Amount Interest MaturityDate Purpose Amount Outstanding Cost (TIC) Date

Oct-02 To partially refund 1993, 1996, 1997, 1999, & 2000 LTGO issues, and issue $1.6 million for the Oracle HR/Payroll Management System Implementation

39,365,000 2,290,000 4.08% 12/1/2018

Jul-05 To construct & equip the East Precinct Police facility, and to partially refund the 98A and 98B LTGO bonds.

18,090,000 1,810,000 4.07% 12/1/2026

Jun-09 To fund multiple Transportation Projects

12,970,000 620,000 4.03% 12/1/2028

Dec-10 To fund the new City Hall and partially refund the 2001 LTGO bond issue

13,410,000 8,625,000 4.50% 12/1/2035

Jun-11 To fund Transportation Projects for the Waterfront Access Project

10,515,000 8,700,000 3.93% 12/1/2035

Jan-12 To partially refund the 2003 LTGO bond issue for the Firstenburg Community Center

15,945,000 13,275,000 3.26% 12/1/2029

Dec-12 To partially refund the 2002 LTGO & Refunding bond issue for VancouverCenter, West Coast Bank, and Street Improvements

9,515,000 9,285,000 2.36% 12/1/2025

Jun-15 To fund the West Barracks rennovations (Vancouver Heritage Bonds)

1,296,500 1,296,500 4.33% 12/1/2028

Jun-15 To fund the West Barracks rennovations and to partially refund the 2005 LTGO, 2006 LTGO, and the 2008 LTGO issued for the East Police Precinct, West Police Precinct, Evidence Building, Fire Station 810, Transportation Projects, and the Marshall CC remodel.

23,100,000 21,440,000 2.54% 12/1/2034

Jun-16To Partially refund 2009 LTGO issued for Transportation Projects. 7,810,000$ 7,745,000$ 1.89% 12/1/2028

Total Outstanding General Obligation Bonds 75,086,500$


City of VancouverOutstanding Debt - Revenue BondsThird Quarter 2018

True FinalIssue Original Issue Amount Interest MaturityDate Purpose Amount Outstanding Cost (TIC) Date

Feb-04 Partially refund the 1999 Water/Sewer Revenue Bonds

26,250,000 7,490,000 3.998% 6/1/2020

7,490,000$


City of VancouverInvestment Activity

Third Quarter of 2018(Dollars in thousands)

As of Percent of As of Percent of6/30/2018 Portfolio 9/30/2018 Portfolio

State Investment Pool 71,597$ 21.1% 61,832$ 18.3%Clark County Investment Pool 987$ 0.3% 73$ 0.0%U.S. Agencies 265,734$ 78.4% 275,773$ 81.5%Municipal Bonds 504$ 0.1% 502$ 0.1%

Total by Investment Type 338,822$ 100.0% 338,179$ 100.0%

As of Percent of As of Percent of6/30/2018 Portfolio Cumulative 9/30/2018 Portfolio Cumulative

Overnight 72,584$ 21.4% 21.4% 61,904$ 18.3% 18.3%One Month 25,000$ 7.4% 28.8% 25,012$ 7.4% 25.7%Two to Six Months 55,486$ 16.4% 45.2% 70,383$ 20.8% 46.5%Six Months to One Year 90,126$ 26.6% 71.8% 124,907$ 36.9% 83.4%One to Five Years 95,626$ 28.2% 100.0% 55,973$ 16.6% 100.0%

Total by Length of Maturity 338,822$ 100.0% 338,179$ 100.0%


Investment Activity3rd Quarter 2018

Issuer Type of InvestmentTransaction

DateMaturity

Date Purchase or

Deposit Redemption or

Withdrawal

Effective Interest

Rate

JulyClark County Treasurer* Local Government Investment Pool 883 479,653 1.70%FHLB Federal Agency Coupon Securities 7/12/2018 5,000,000 0.84%FHLMC Federal Agency Coupon Securities 7/27/2018 5,000,000 1.00%FHLMC Federal Agency Coupon Securities 7/27/2018 5,000,000 1.00%FHLMC Federal Agency Coupon Securities 7/17/2018 5,000,000 2.07%FNMA Federal Agency Coupon Securities 7/27/2018 5,000,000 0.75%FNMA Federal Agency Coupon Securities 7/13/2018 5,000,000 0.90%FNMA Federal Agency Coupon Securities 7/26/2018 5,000,000 2.51%US Treasury N/B Federal Agency Coupon Securities 7/16/2018 5,000,000 2.30%Washington State Treasurer* Local Government Investment Pool 31,232,248 22,000,000 2.06%

46,233,131 47,479,653

AugustClark County Treasurer* Local Government Investment Pool 884 341,538 1.70%FHLB Federal Agency Coupon Securities 8/1/2018 5,000,000 2.25%FHLB Federal Agency Coupon Securities 8/8/2018 5,000,000 2.48%FHLB Federal Agency Coupon Securities 8/14/2018 5,000,000 2.62%Washington State Treasurer* Local Government Investment Pool 9,959,332 23,000,000 2.06%

24,960,215 23,341,538

SeptemberClark County Treasurer* Local Government Investment Pool 3,000,460 3,095,899 1.70%FHLB Federal Agency Coupon Securities 9/14/2018 5,000,000 0.88%FHLB Federal Agency Coupon Securities 9/14/2018 5,000,000 0.88%FHLB Federal Agency Coupon Securities 9/17/2018 5,000,000 2.70%FHLB Federal Agency Coupon Securities 9/25/2018 5,000,000 2.46%FHLMC Federal Agency Coupon Securities 9/10/2018 5,000,000 2.50%Washington State Treasurer* Local Government Investment Pool 24,043,197 30,000,000 2.06%

42,043,657 43,095,899 * Investments in the County and State Local Government Investment Pools can change daily, therefore no purchase dates are shownand the maturity dates are the last date for each reporting period.


City of Vancouver Investment Portfolio Including Call Dates

9/30/2018Purchase Maturity Par Market Book Percent Cumulative Interest Effective

CUSIP Issuer Date Date Value Value Value of Portfolio Percent Rate Yield CallableCLARK CO LGIP Clark County LGIP 72,511 72,511 72,511 0.0% 0.0% 1.68% 1.70%WA STATE LGIP Washington State LGIP 61,831,681 61,831,681 61,831,681 18.3% 18.3% 1.99% 2.01%3130A9M24 Federal Home Loan Bank 10/3/2016 10/3/2018 5,000,000 4,999,700 5,000,000 1.5% 1.5% 0.93% 0.94% 1/3/20173137EAED7 Federal Home Loan

9/16/2016 10/12/2018 5,000,000 4,998,050 4,999,968 1.5% 1.5% 0.88% 0.90% Bullet

3133EFJP3 Federal Farm Credit Bank 4/8/2016 10/15/2018 5,000,000 4,997,700 5,000,000 1.5% 1.5% 1.09% 1.10% Bullet3134G7T43 Federal Home Loan

7/17/2018 10/29/2018 5,000,000 5,007,567 5,011,917 1.5% 1.5% 2.04% 2.07% Bullet

3135G0G64 Federal Nat'l Mtg. Assoc. 4/13/2017 10/29/2018 5,000,000 4,995,700 5,000,000 1.5% 1.5% 1.21% 1.23% Bullet3133EGA70 Federal Farm Credit Bank 11/4/2016 11/1/2018 5,000,000 4,994,900 5,000,000 1.5% 1.5% 0.96% 0.97% Bullet3134GAUT9 Federal Home Loan

11/15/2016 11/15/2018 5,000,000 4,992,500 5,000,000 1.5% 1.5% 0.99% 1.00% Bullet

3133EGJ55 Federal Farm Credit Bank 11/16/2016 11/16/2018 5,000,000 4,991,100 5,000,000 1.5% 1.5% 0.97% 0.98% Bullet3130A77H2 Federal Home Loan Bank 12/5/2017 11/28/2018 5,000,000 4,991,300 4,995,325 1.5% 1.5% 1.68% 1.70% Bullet592240UD5 Tacoma Metropolitan Park 12/1/2016 12/1/2018 500,000 500,950 501,680 0.1% 0.1% 0.95% 0.96% Bullet313376BR5 Federal Home Loan Bank 5/22/2018 12/14/2018 5,000,000 4,995,150 4,996,482 1.5% 1.5% 2.07% 2.10% Bullet3133EFT49 Federal Farm Credit Bank 4/5/2018 12/28/2018 5,000,000 4,984,450 5,000,000 1.5% 1.5% 2.05% 2.08% Bullet3133EFGN1 Federal Farm Credit Bank 11/17/2017 1/7/2019 5,000,000 4,983,700 5,000,000 1.5% 1.5% 1.60% 1.62% Bullet3130AAE46 Federal Home Loan Bank 2/15/2018 1/16/2019 5,000,000 4,985,200 4,988,992 1.5% 1.5% 1.99% 2.02% Bullet3135GOH63 Federal Nat'l Mtg. Assoc. 4/11/2018 1/28/2019 5,000,000 4,984,700 4,989,156 1.5% 1.5% 2.02% 2.05% Bullet3135G0J53 Federal Nat'l Mtg. Assoc. 4/19/2018 2/26/2019 5,000,000 4,973,650 4,976,691 1.5% 1.5% 2.14% 2.17% Bullet3135G0J53 Federal Nat'l Mtg. Assoc. 6/19/2018 2/26/2019 5,000,000 4,973,650 4,976,125 1.5% 1.5% 2.17% 2.20% Bullet3133782M2 Federal Home Loan Bank 4/26/2018 3/8/2019 5,000,000 4,981,550 4,984,514 1.5% 1.5% 2.19% 2.22% Bullet3133782M2 Federal Home Loan Bank 8/1/2018 3/8/2019 5,000,000 4,981,550 4,983,862 1.5% 1.5% 2.22% 2.25% Bullet459058DL4 US Treasury N/B 7/16/2018 3/15/2019 5,000,000 4,987,400 4,990,496 1.5% 1.5% 2.27% 2.30% Bullet3137EADZ9 Federal Home Loan

5/7/2018 4/15/2019 5,000,000 4,968,088 4,974,386 1.5% 1.5% 2.19% 2.22% Bullet

3137EADZ9 Federal Home Loan

5/7/2018 4/15/2019 500,000 496,809 497,439 0.1% 0.1% 2.19% 2.22% Bullet3133EF4Y0 Federal Farm Credit Bank 7/14/2017 4/26/2019 5,000,000 4,958,400 4,988,776 1.5% 1.5% 1.38% 1.40% Bullet459058FC2 US Treasury N/B 11/6/2017 4/26/2019 5,000,000 4,962,700 4,988,860 1.5% 1.5% 1.63% 1.65% Bullet3130ABF92 Federal Home Loan Bank 4/20/2018 5/28/2019 5,000,000 4,963,150 4,972,334 1.5% 1.5% 2.20% 2.23% Bullet3130ABF92 Federal Home Loan Bank 6/20/2018 5/28/2019 5,000,000 4,967,351 4,972,448 1.5% 1.5% 2.32% 2.36% Bullet3137EADG1 Federal Home Loan

5/22/2018 5/30/2019 5,000,000 4,975,050 4,982,049 1.5% 1.5% 2.27% 2.30% Bullet

3133EGFU4 Federal Farm Credit Bank 10/26/2017 6/20/2019 5,000,000 4,953,400 5,000,000 1.5% 1.5% 1.62% 1.65% Bullet3130A8DB6 Federal Home Loan Bank 9/25/2018 6/21/2019 5,000,000 4,963,888 4,967,159 1.5% 1.5% 2.43% 2.46% Bullet3136G3RX5 Federal Nat'l Mtg. Assoc. 6/18/2018 6/21/2019 5,000,000 4,957,300 4,964,760 1.5% 1.5% 2.34% 2.37% Bullet3133EGHD0 Federal Farm Credit Bank 6/27/2016 6/27/2019 5,000,000 4,948,650 5,000,000 1.5% 1.5% 1.11% 1.12% Bullet3136G3TD7 Federal Nat'l Mtg. Assoc. 6/28/2016 6/28/2019 5,000,000 4,950,500 5,000,000 1.5% 1.5% 1.18% 1.20% 12/28/20183136G3UN3 Federal Nat'l Mtg. Assoc. 10/10/2017 6/28/2019 5,000,000 4,949,700 5,000,000 1.5% 1.5% 1.52% 1.54% 12/28/20183133EGJX4 Federal Farm Credit Bank 7/8/2016 7/5/2019 5,000,000 4,944,300 5,000,000 1.5% 1.5% 1.07% 1.08% Bullet3137EAEB1 Federal Home Loan

5/18/2018 7/19/2019 5,000,000 4,934,200 4,940,957 1.5% 1.5% 2.35% 2.38% Bullet

3135G0N33 Federal Nat'l Mtg. Assoc. 5/16/2017 8/2/2019 5,000,000 4,929,850 4,978,446 1.5% 1.5% 1.38% 1.40% Bullet3136G3K38 Federal Nat'l Mtg. Assoc. 5/22/2017 8/2/2019 5,000,000 4,943,700 5,000,000 1.5% 1.5% 1.33% 1.35% 11/2/20183135G0N33 Federal Nat'l Mtg. Assoc. 6/29/2018 8/2/2019 5,000,000 4,929,850 4,936,644 1.5% 1.5% 2.39% 2.42% Bullet3130A8Y72 Federal Home Loan Bank 8/8/2018 8/5/2019 5,000,000 4,928,465 4,933,987 1.5% 1.5% 2.44% 2.48% Bullet3133EGAW5 Federal Farm Credit Bank 5/19/2016 8/19/2019 5,000,000 4,942,450 5,000,000 1.5% 1.5% 1.23% 1.25% Bullet3135G0P23 Federal Nat'l Mtg. Assoc. 5/10/2017 8/23/2019 4,900,000 4,839,142 4,900,000 1.4% 1.4% 1.48% 1.50% 11/23/20183135G0ZG1 Federal Nat'l Mtg. Assoc. 7/26/2018 9/12/2019 5,000,000 4,958,800 4,964,552 1.5% 1.5% 2.48% 2.51% Bullet3135G0ZG1 Federal Nat'l Mtg. Assoc. 9/10/2018 9/12/2019 5,000,000 4,958,800 4,965,132 1.5% 1.5% 2.47% 2.50% Bullet3136G36G5 Federal Nat'l Mtg. Assoc. 9/27/2016 9/27/2019 5,000,000 4,932,200 5,000,000 1.5% 1.5% 1.23% 1.25% 12/27/20183135G0Q30 Federal Nat'l Mtg. Assoc. 11/14/2016 9/27/2019 5,000,000 4,926,900 5,000,000 1.5% 1.5% 1.20% 1.22% Bullet459058FQ1 US Treasury N/B 10/13/2017 9/30/2019 5,000,000 4,922,150 4,978,876 1.5% 1.5% 1.61% 1.63% Bullet3130A8NR0 Federal Home Loan Bank 7/13/2016 10/11/2019 5,000,000 4,918,600 5,000,000 1.5% 1.5% 1.14% 1.16% Bullet3130ACM92 Federal Home Loan Bank 5/10/2018 10/21/2019 5,000,000 4,943,708 4,955,747 1.5% 1.5% 2.40% 2.44% Bullet3136G4GE7 Federal Nat'l Mtg. Assoc. 11/15/2016 11/15/2019 5,000,000 4,912,950 5,000,000 1.5% 1.5% 1.16% 1.18% Bullet3130AA2X5 Federal Home Loan Bank 11/22/2016 11/22/2019 5,000,000 4,921,200 5,000,000 1.5% 1.5% 1.34% 1.36% Bullet3130ADMS8 Federal Home Loan Bank 8/14/2018 2/14/2020 5,000,000 4,957,600 4,974,619 1.5% 1.5% 2.58% 2.62% 4/8/20163130AE2M1 Federal Home Loan Bank 9/17/2018 4/20/2020 5,000,000 5,031,742 5,042,089 1.5% 1.5% 2.66% 2.70% 4/8/20163137EAEM7 Federal Home Loan

4/26/2018 4/23/2020 1,000,000 995,846 1,000,486 0.3% 0.3% 2.47% 2.50% Bullet

3134GBPU0 Federal Home Loan

11/16/2017 5/22/2020 5,000,000 4,914,200 5,000,000 1.5% 1.5% 1.86% 1.88% 11/22/20183133EGSA4 Federal Farm Credit Bank 8/24/2016 8/24/2020 5,000,000 4,861,150 5,000,000 1.5% 1.5% 1.30% 1.32% Bullet3130ACLP7 Federal Home Loan Bank 10/30/2017 11/5/2020 5,000,000 4,894,400 5,000,000 1.5% 1.5% 1.94% 1.97% 11/5/20183133EGQS7 Federal Farm Credit Bank 8/10/2016 11/10/2020 5,000,000 4,852,200 5,000,000 1.5% 1.5% 1.38% 1.40% Bullet3133EGEU5 Federal Farm Credit Bank 5/31/2017 12/14/2020 5,000,000 4,859,650 5,000,000 1.5% 1.5% 1.63% 1.65% Bullet

1 Years 338,179,150


quarterly financial report - q3 2018 · 2019. 1. 14. · (this report contains un-audited financial...

Documents