Checks. alances. Prepared by the Clerk & Comptroller for the Fiscal Year Ended September 30, 2016

Transcription

1 Checks B alances & Your Guide to County Finances Palm Beach County, Florida Prepared by the Clerk & Comptroller for the Fiscal Year Ended September 30, 2016

2 Message from Clerk Bock Dear Residents, As your independently elected Clerk & Comptroller for Palm Beach County, my responsibilities include serving as the County s Chief Financial Officer, Auditor and Treasurer. I am committed to examining how your tax dollars are spent, educating the public about County financial matters and promoting transparency and accountability in County government. Annually, my office s team of skilled finance professionals reviews an array of data that measure the financial strength of Palm Beach County government. In addition to examining how much of your tax money is collected and spent (see County Government Revenue, page 7 and Where Your Money Goes, page 14), our team evaluates other important metrics that affect our County s fiscal well-being, such as housing prices and employment rates (See Your Community, pages 5 and 6). Sharon R. Bock Clerk & Comptroller Palm Beach County Clerk & Comptroller Sharon R. Bock, Esq., holds a Juris Doctorate, has earned insurance and securities licenses Series 7, 63 and 65 and has been certified as an Accredited Investment Fiduciary. Elected to office in 2004, one of Clerk Bock s top priorities is to educate the public about how tax dollars are managed and spent. Checks & Balances: Your Guide to County Finances provides highlights of the County budget, information about your property taxes and County demographics. It is one of the many useful financial publications available on our website at For a more in-depth view of County finances, please review our Comprehensive Annual Financial Report, which serves as the basis for much of the information you ll find in this edition of Checks & Balances. It is my honor and privilege to serve as your Clerk & Comptroller. Thank you for reading the Fiscal Year 2016 version of Checks & Balances, our 11th edition of this award winning publication, and for taking an interest in how your tax dollars are spent. Best regards, Sharon R. Bock, Esq. Constitutional Clerk & Comptroller, Palm Beach County

3 Tallahassee Table of Contents INTRODUCTION About This Guide...1 YOUR COUNTY About the Clerk & Comptroller...2 Your County Government...3 Palm Beach County 2016 Major Initiatives...4 Your Community Palm Beach County YOUR COUNTY S FUNDING County Government Revenue...7 Property Taxes User Fees...11 YOUR COUNTY S BUDGET Budget at a Glance...12 Select Operating Budgets...13 West Palm Beach YOUR COUNTY S EXPENSES Where Your Money Goes...14 Capital Assets...15 Reserves...16 Miami YOUR TAX DOLLARS AT WORK Investments...17 Debt...18 What the County Owns and Owes...19 CONTACT INFORMATION...20

4 About This Guide Checks & Balances: Your Guide to County Finances is an essential tool to help you understand how public money is managed and spent in Palm Beach County. Most of the information in this awardwinning audited report is derived from the Clerk & Comptroller s Comprehensive Annual Financial Report (CAFR) for the fiscal year that ended on September 30, The CAFR is available at mypalmbeachclerk.com/countyfinances and includes more than 200 pages of audited, detailed County financial statements, notes, schedules and reports. Checks & Balances, which is also known as the Popular Annual Financial Report (PAFR), includes condensed and simplified information from the CAFR, County budget and other financial reports. This guide is a recommended practice of the Government Finance Officers Association (GFOA), the authority on best practices in governmental accounting and financial reporting. Because this is a summary, Checks & Balances does not conform to generally accepted accounting principles and reporting requirements for government entities. Additionally, this guide does not include financial information on the Solid Waste Authority, Housing Finance Authority of Palm Beach County, Westgate/Belvedere Homes Community Redevelopment Agency or the Metropolitan Planning Organization of Palm Beach County. These organizations are set up by Florida Statutes, County ordinance or resolution to be entities that are legally separate from the County. Efforts and courage are not enough without purpose and direction. John F. Kennedy 1 INTRODUCTION

5 About the Clerk & Comptroller The Clerk & Comptroller, established in 1838 by the Florida Constitution as an independently elected office, is charged with safeguarding your public records and public funds. In addition to the roles of Clerk of the Circuit Court, County Recorder and Clerk of the Board of County Commissioners, the Clerk has the following responsibilities as County Comptroller: Chief Financial Officer - Monitor the County budget, revenue, debt and spending. Pay County bills, maintain financial records and produce required financial statements and reports. Treasurer - Manage the County investment portfolio to earn investment income on taxpayer funds. Auditor - Conduct independent risk-based and financial audits, and audit all County expenditures. The office s accountability is ensured through regular, independent audits conducted by 11 different state, local and judicial entities. As the County s Chief Financial Officer, one of the most important duties of the Clerk is providing clear, concise and transparent information about County revenue and spending. We are honored that Checks & Balances: Your Guide to County Finances has earned the award for Outstanding Achievement in Popular Annual Financial Reporting each year since its fiscal year 2006 debut. The Comprehensive Annual Financial Report (CAFR) has received the GFOA s Certificate of Achievement for Excellence in Financial Reporting for an impressive 27 consecutive years. You can find all of the Clerk s financial publications online at mypalmbeachclerk.com/countyfinances. Additionally, as part of our commitment to financial transparency, visit us online to view audits conducted by the Clerk, audits of the office conducted by external entities and Clerks in the Sunshine, a section containing Clerk budget information and efficiency reports. Checks & Balances Awarded Outstanding Achievement in Popular Annual Financial Reporting for 10 Consecutive Years YOUR COUNTY 2

6 Your County Government County Government Established in 1909 as a political subdivision of the state of Florida, Palm Beach County is governed by a Board of County Commissioners (BOCC) made up of seven citizens elected in separate districts. These commissioners act as a local legislative and executive body, setting public policy, levying taxes and funding projects, programs and the operations for more than 30 County departments. An appointed County administrator carries out the policies and decisions made and approved by the commissioners. The BOCC is regulated by state statutes and a County charter that voters approved in The County operates under a home rule charter, which means that citizens can create, modify or amend local laws. Budget Process The County must prepare an annual budget authorizing the spending of public money, which comes primarily from your property taxes. State law requires the County to have a balanced budget that can only be amended throughout the year with BOCC approval at public board meetings (see Budget at a Glance, page 12). The fiscal year for the budget begins on October 1 and ends on September 30. In addition to the BOCC, the school board as well as 39 municipalities within Palm Beach County create their own budgets and have the ability to tax residents. There also are more than 80 different special districts within the County that may levy taxes or assessments. Constitutional Check and Balance Voters also elect five independent constitutional officers who are a check and balance on the BOCC. They are the Clerk & Comptroller, Property Appraiser, Sheriff, Supervisor of Elections and Tax Collector. The framers of the Florida Constitution intentionally made these countywide offices separate and independent from the rest of County government to ensure that the entity that decides how to spend your tax dollars (BOCC) is not the same entity that audits and pays the County s bills (Clerk & Comptroller), assesses your property s taxable value (Property Appraiser), collects your taxes (Tax Collector), protects its citizens (Sheriff) or oversees the election process (Supervisor of Elections). 3 YOUR COUNTY

7 Palm Beach County 2016 Major Initiatives Infrastructure Infrastructure surtax adopted to: Relieve infrastructure back log Repair transportation infrastructure Repair and replace public facilities Homelessness Develop a comprehensive homeless system of care Early availability of sustainable housing and shelters for the homeless Behavioral Health Establish a behavioral health system to aggressively address: Crime Substance abuse Economic Development Job creation Criminal justice Other Initiatives Palm Tran Affordable housing Redevelopment Fire rescue Baseball stadium YOUR COUNTY 4

8 Your Community Palm Beach County s Top Five Taxpayers for Florida Power & Light...$98,645, Town Center at Boca Raton Trust...$8,587, Garden Venture LLC (PGA Mall)...$5,850, Breakers Palm Beach Inc...$5,466, U.S. Sugar Corporation...$5,422,605 Florida Power & Light Top Palm Beach County Taxpayer in 2016 with $98,645,093 Change in 2016 Top Five, the Breakers Palm Beach Inc moved up to fourth and BellSouth Telecommunications, Inc. dropped from fifth to ninth. 1 Source: Constitutional Tax Collector of Palm Beach County 6.0% Unemployment Rates FY U.S. Unemployment Rate at the End of FY % 4.0% 2.0% Florida Unemployment Rate at the End of FY % 0.0% Oct 2015 Nov 2015 Dec 2015 Jan 2016 Feb 2016 Mar 2016 While the County and United State s unemployment rate grew during FY 2016, unemployment throughout Florida declined. All three statistical geographic areas continued to approach full employment, as defined by the Federal Reserve Bank 3. 2,3 Source: U.S. Bureau of Labor Statistics. Rates not seasonally adjusted. Apr 2016 May 2016 Jun 2016 Jul 2016 Palm Beach County Florida United States Aug 2016 Sep 2016 Palm Beach County s Top Private Employers as of Tenet Healthcare Corp...4, NextEra Energy, Inc...4, Hospital Corporation of America - HCA...3, Boca Raton Regional Hospital...2, Jupiter Medical Center...2,195 More than 52,000 companies supply products and services in Palm Beach County. 4 Of the top five employers in the County, four are in the healthcare industry. 4 Source: Business Development Board of Palm Beach County Tenet Healthcare Corp #1 Private Employer in the County 4,595 Employed 5 YOUR COUNTY

9 Your Community $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 Median Sales Price Comparison 5 Single-Family Homes $212,000 $145,000 $168,500 $264,000 $275,000 $285,000 $306,953 $178,000 $196,000 $219, Palm Beach County Florida 3.6% 7.7% Palm Beach County s real estate market continued to recover, a trend that began in In 2016, the median sales price for a single-family home rose in Palm Beach County as well as in the state of Florida. Median sales price is the preferred summary statistic for price activity because, unlike average sales price, median sales price is not sensitive to high sales prices for small numbers of homes that may not be characteristic of the market area. 5 Source: Florida Realtors. Figures are for calendar year. Another important metric for measuring the health of real estate in the county is the number of mortgages and deeds recorded. Since 2012, the number of mortgages recorded has increased 23 percent and the number of deeds has increased 12 percent. Meanwhile, the number of new foreclosure cases filed in Palm Beach County has fallen 71 percent since Source: Clerk & Comptroller, Palm Beach County. Figures are for calendar year. 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Closed Sales of Single-Family Homes, Palm Beach County Mortgages and Deeds Recorded Deeds Mortgages New Foreclosure Filings Closed sales are one of the simplest, yet most important indicators for the residential real estate market. With an upward trend, this metric further attests to the ongoing recovery in real estate for Palm Beach County. While sales abated slightly in 2016, closed sales on single-family homes are up almost 41 percent since 2011 *. * Figures are for calendar year. YOUR COUNTY 6

10 County Government Revenue Funding for County government and services comes from many sources, the largest being property taxes. The County s property tax revenue continued its upward trend which began in Revenue from this source increased over 9 percent during FY 2016, and has risen almost 22 percent since With the economy continuing to improve, most other revenue sources have increased as well, such as other local taxes, state shared revenue, franchise fees and capital grants/contributions. 1 Governmental activities represent those that are supported primarily by taxes and intergovernmental revenues. They exclude the business-type activities of the County, such as the Department of Airports and the Water Utilities Department, which are intended to recover all or most of their costs through user fees and charges. FY 2016 Governmental Activities Revenues 1 Total $1,822,976,193 State Shared Revenues $150,115,400 8% Grants and Other 2 $128,427,552 7% Other Local Taxes $139,189,080 8% Franchise Fees $36,166,164 2% 2 Grants by definition are primarily contributions of assets (usually cash) by one governmental unit or other organization to another. Typically, these contributions are made to local governments from state and federal governments. Grants are usually made for specified purposes. Charges for Services $366,445,644 20% Property Taxes $1,002,632,353 55% Trends in Governmental Activities Revenues FY 2011-FY 2016 $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,000,000 $200,000,000 $0 Property Taxes Charges for Services Operating Grants/ Contributions State Shared Revenues Other Local Taxes Investment Income Franchise Fees Capital Grants/ Contributions Other YOUR COUNTY S FUNDING

11 Property Taxes The Board of County Commissioners and other taxing entities each set a property tax rate, called a millage rate, which is used to calculate your overall property taxes. A mill is equal to $1 of tax for every $1,000 of assessed property value. As shown in the Palm Beach County taxing cycle chart, the funding of government each year starts with an assessment of your property s taxable value at the beginning of the calendar year. JANUARY Property Value Assessed Property Appraiser determines market value and exemption eligibility, which is used to calculate your property s taxable value. JULY Tax Millage Rate Based on how much money is needed to cover expenses, the BOCC and other taxing entities set millage rates, which are used to calculate property taxes. AUGUST Property Tax Notice Property Appraiser mails a notice of proposed taxes, or Truth in Millage (TRIM) notice. Taxpayers may challenge the assessment by petitioning the Value Adjustment Board (VAB). NOVEMBER Property Tax Bill Tax Collector mails tax bill to property owner and begins collecting payment. Palm Beach County Taxing Cycle NOVEMBER - MARCH Funding of Government Services Tax Collector distributes property tax collections to local governments and taxing authorities. For the County, the Clerk & Comptroller receives those funds and invests them until they are needed to pay bills. HOW YOUR PROPERTY TAXES ARE CALCULATED [ Assessed Value of Property - Exemption(s) ] 1,000 x Total Millage Rate = Total Property Tax YOUR COUNTY S FUNDING 8

12 Property Taxes If you own property in Palm Beach County, your annual tax bill funds much more than County government. Other agencies including the Palm Beach County School Board, Children s Services Council and the Health Care District each establish a millage rate, which is reflected in your annual tax bill. You may also pay taxes to a municipality and to special taxing districts such as the South Florida Water Management District or Florida Inland Navigation District. This illustration is an example of how each of your tax dollars is divided. Palm Beach County School Board 3 $2,065.80, 54.1% Breakdown of Your Property Tax Bill Countywide Portion Assessed Value of $300,000 Total Taxes: $3, Palm Beach County $1,231.93, 32.2% Palm Beach County Health Care District $260.65, 6.8% Children s Services Council $166.93, 4.4% South Florida Water Management District $88.78, 2.3% Florida Inland Navigation District (FIND) $8.00, 0.2% Note: Figures shown in the example do not include municipalities, unincorporated areas or any applicable special districts within. Figures shown are net of applicable exemption amounts. 3 The Palm Beach County School Board operating millage rate is set by the Florida Legislature. 9 YOUR COUNTY S FUNDING

13 Property Taxes In FY 2016, the County once again kept the operating millage at , which is the same rate as FY The approved operating millage rate was 7.6 percent higher than the rollback rate of The rollback rate is the millage rate that provides the same amount of property tax revenue as the prior year, excluding any new construction that would add value to the County s tax base in FY MILLS Property Tax Millage Rates FY 2011-FY As a result of the increase in taxable property value, the County s property tax revenues were up 9 percent, as shown below in Property Tax Revenues Total Total Total Total County 4 School District Other Total Total Includes countywide operating millage as well as a millage rate for voter-approved debt. 5 Other includes the South Florida Water Management District, Children s Services Council, Florida Inland Navigation District, Everglades Construction Project and the Palm Beach County Health Care District. $1,100,000,000 $1,000,000,000 $900,000,000 $800,000,000 $700,000,000 $600,000,000 $500,000,000 Property Tax Revenues FY 2007-FY 2016 $1.003B $939.7M $897.9M $917.3M $855.8M $861.0M $839.7M $824.0M $827.9M $856.8M How Do Rising Property Values Affect My Property Taxes? When property values increase, that does not mean all property owners will receive a larger tax bill in return. Under Florida law, each year the taxable value of a homesteaded property cannot increase by more than 3 percent or by the percent change of the Consumer Price Index, whichever is less. If you sell your home, the state s portability laws allow you to transfer up to $500,000 of your property s homesteaded value to your new property anywhere in Florida. YOUR COUNTY S FUNDING 10

14 User Fees $100,000,000 $80,000,000 $60,000,000 $40,000,000 $20,000,000 $0 $76.1M Sales Tax Revenue FY 2007-FY 2016 $72.4M Sales Tax Revenue FY2007-FY2016 $64.7M $64.3M $66.8M $70.2M $74.1M $79.4M $84.7M $87.8M With the ongoing economic recovery, tourism in Palm Beach County in FY 2016 flourished. Once again Tourist Development Tax receipts hit a record level during FY 2016, increasing 10.3 percent over FY These bed taxes support tourism-related expenses, culture, film and sporting events. Airport travel was up 2.6 percent, with approximately 6.3 million passengers traveling through Palm Beach International Airport 6. 6 Source: Palm Beach International Airport $50,000,000 $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 $26.8M Another significant source of income for the County is sales tax. With Florida s consumer confidence continuing to rise throughout 2016, Palm Beach County s sales tax collections increased for the sixth consecutive year, up 3.7 percent over FY 2015 and up 15.4 percent since FY Tourist Development Tax FY 2007-FY 2016 $27.8M $22.3M $23.2M $25.5M $28.8M $30.5M $33.8M $42.7M $47.1M $60,000,000 $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 Local Option Gas Tax Revenue FY 2007-FY 2016 $47.7M $46.1M $45.5M $44.9M $44.6M $45.6M $45.5M $46.9M $49.8M $50.9M Local Option Gas Taxes paid by motorists for gasoline increased 2.2 percent over FY Gradually increasing gasoline prices and more miles driven due to an improving economy contributed to the increase, partially offset by better mileage on newer vehicles. In FY 2016 the County s bus system had an 11 percent decline in ridership, to a total of 9.7 million trips versus 10.3 million in FY Source: Palm Tran 11 YOUR COUNTY S FUNDING

15 Budget at a Glance By law, Palm Beach County government must create and approve a balanced budget giving the County the legal authority to spend money on operations, services and projects. This financial plan for funding all County operations totaled $4.1 billion in FY 2016, an increase of 2.2 percent from the prior year. A series of budget workshops and two public hearings are held before the Board of County Commissioners adopts the budget at the start of each fiscal year on October 1. For the dates of these meetings, please visit discover.pbcgov.org. General Fund: Primary operating fund that pays for government operations. Special Revenue Funds: Funds from sources such as library fees, grants and Tourist Development taxes, which may only be used for specific purposes. Debt Service Funds: Designated to pay principal and interest on the County s long-term debt. Capital Projects Funds: Include money Fund Types for major projects such as roads, parks and libraries. Enterprise Funds: Contain user fees from revenue-producing County operations, such as the Department of Airports and Water Utilities. Internal Service Funds: Include money paid for goods and services received from one County department or Constitutional Officer to the other. Budget by Fund Type FY 2012-FY 2016 $1,200,000,000 $1,100,000,000 $1,000,000,000 $900,000,000 $800,000,000 $700,000,000 $600,000,000 $500,000,000 $400,000,000 $300,000,000 $200,000,000 $100,000,000 $0 General Fund Special Revenue Funds Debt Service Funds Capital Projects Funds Enterprise Funds Internal Service Funds YOUR COUNTY S BUDGET 12

16 Select Operating Budgets Palm Beach County, Florida Comparison of Select Operating Budgets Funded by Tax Dollars 1 County Department FY 2015 Budget FY 2016 Budget Percent Change Average Cost Per Taxpayer 3 Parks and Recreation $48,851,581 $50,923, % $80.51 Facilities Development and Operations $34,464,772 $37,165, % $58.76 Community Services $15,552,814 $16,084, % $25.43 Engineering and Public Works $22,667,337 $19,622, % $31.02 Public Safety $14,633,482 $15,996, % $25.29 Environmental Resource Management $10,212,072 $11,123, % $17.59 Planning, Zoning and Building $8,191,080 $9,205, % $14.55 County Attorney $3,914,069 $3,902, % $6.17 County Commission $3,284,740 $3,368, % $5.33 County Administration $1,683,770 $1,655, % $2.62 Risk Management $385,975 $383, % $0.61 Metropolitan Planning Organization $160,546 $195, % $0.31 Dependent Districts Fire Rescue $222,939,405 $243,487, % $ County Library $41,552,138 $44,960, % $71.08 Constitutional Officers 2 Sheriff $461,878,258 $485,436, % $ Property Appraiser $17,671,398 $18,203, % $28.78 Supervisor of Elections $8,819,250 $11,095, % $17.54 Clerk & Comptroller $12,509,506 $12,854, % $20.32 Tax Collector $4,374,300 $8,941, % $14.14 Source: Palm Beach County Annual Budget FY Budget amounts reflect only the County taxpayer funded portion of the budget, and do not include other revenue sources such as grants and user fees. 2 Represents portion of budget funded by the Board of County Commissioners. 3 Calculated for FY 2016, Taxpayer represents a taxable parcel, of which there are 632,489 as of September 30, Actual cost dependent upon valuation of parcel. 13 YOUR COUNTY S BUDGET

17 Where Your Money Goes Palm Beach County, which operates two enterprise activities the Department of Airports and the Water Utilities Department and its independently elected constitutional officers provide a full range of services. General Government expenses include property assessment, tax collection, financial reporting, investment management, official record keeping and court-related support functions. During FY 2016, the County spent less on the physical environment than in FY However, it experienced increased expenditures in the areas of law enforcement, fire protection as well as transportation services. Economic Environment $80,431,368 4% Transportation $173,305,361 9% Human Services $83,301,450 5% FY 2016 Governmental Activities Expenses Total $1,863,257,972 Physical Environment $26,697,038 2% Culture and Recreation $122,747,914 7% Interest Expense $38,457,926 2% General Government $398,900,185 21% Public Safety $939,416,730 50% Trends in Governmental Activities Expenses FY 2011-FY 2016 $1,000,000,000 $900,000,000 $800,000,000 $700,000,000 $600,000,000 $500,000,000 $400,000,000 $300,000,000 $200,000,000 $100,000,000 $0 Public Safety General Government Transportation Culture and Recreation Human Services Economic Environment Interest Expense Physical Environment YOUR COUNTY S EXPENSES 14

18 Capital Assets The County s capital assets as of the end of FY 2016 totaled $3.959 billion (net of accumulated depreciation), up $125 million from FY Governmental activities and business-type activities accounted for $67 million and $58 million of the increase respectively. FY 2016 Highlights: The increase in governmental activities capital assets is primarily due to construction of the new Spring Training Complex for the Washington Nationals and Houston Astros, scheduled to be completed in the early spring of The increase in business-type activities capital assets is largely due to: Capital Assets, Net Of Accumulated Depreciation At Year-End Governmental Activities Business-type Activities TOTAL PRIMARY GOVERNMENT Land $695M $689M $131M $123M $826M $812M Buildings and Improvements $726M $736M $265M $218M $991M $954M Improvements Other Than Buildings $191M $191M $944M $901M $1,135M $1,092M Equipment $211M $214M $33M $27M $244M $241M Infrastructure $368M $384M - - $368M $384M Intangible - Easement Rights - - $11M $11M $11M $11M Goodwill - - $5M $5M $5M $5M Construction in Progress $316M $226M $63M $109M $379M $335M TOTALS $2,507M $2,440M $1,452M $1,394M $3,959M $3,834M 1 FY 2015 adjusted for reclassification of goodwill. 1. The Water Utilities Department repairing and replacing infrastructure related to the Glades Utility Authority. Efforts are being made to improve the water quality in the cities of Belle Glade, South Bay and Pahokee. Construction in Progress/Other 10% Capital Assets, Net September 30, 2016 Infrastructure 9% 2. The Department of Airports completing several projects including upgrading the baggage handling system ($48.1 million), land acquisition ($6.98 million), taxiway rehabilitation ($5.86 million) and terminal restroom renovation and expansion ($4.85 million). Land 21% Buildings & Improvements 25% Equipment 6% Improvements Other Than Buildings 29% 15 YOUR COUNTY S EXPENSES

19 Reserves Reserves are funds that are set aside to pay for both planned as well as unanticipated expenses in the future. As was the case in FY 2015, the County saw a decrease in its reserves in FY Total reserves fell approximately $67 million or 8.3 percent from the prior year. While developing the budget, County managers evaluate the funding necessary for current and future projects. Capital Projects Reserves are set aside for capital improvement projects; Contingency Reserves are set aside to meet unanticipated needs; Operating Reserves fund a variety of specific costs; Debt Service Reserves are established for future debt service payments; and Balance Forward Reserves are funds carried forward from prior fiscal years. $500,000,000 Reserve Analysis Fiscal Year Ends Total Reserves as of September 30, 2016 = $734,925,577 $450,000,000 $400,000,000 $350,000,000 $300,000,000 $250,000,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 $0 Contingency Capital Projects Other Operating Debt Service Balance Forward YOUR COUNTY S EXPENSES 16

20 Investments As Treasurer, the Clerk & Comptroller is responsible for investing County funds until they are needed to pay County expenses. The County Investment Policy limits the portfolio to high quality fixed-income securities and bank deposits. The stock market is not an option. Investment objectives are safety, liquidity and return, in that order. The Clerk & Comptroller s investment team continues to invest in assets that minimize volatility and preserve principal. During FY 2016 the portfolio generated a total return of 1.4 percent, earning $22 million in investment income. In managing the County s investments, the Clerk & Comptroller continues to outperform other Florida peer counties. In addition, in comparing the performance nationally to other large counties throughout the United States,* Palm Beach County s yield was the highest for the last three years by a large margin. *Of the 27 counties for which comparable investment statistics were available. For the eighth consecutive year, the Centre for Fiduciary Excellence certified the Clerk & Comptroller as adhering to a global standard of excellence in managing the County s investments. Portfolio Allocation as of September 30, 2016 Cumulative Investment Income By Fiscal Year Florida Local Government Investment Trust 4% Commercial Paper 6% $350,000,000 $300,000,000 Israel Bond 5% $250,000,000 $200,000,000 Small Business Administration Pool 6% $150,000,000 $100,000,000 $50,000,000 Money Market/FLCLASS 12% Certificate of Deposit 67% $ Cumulative Interest Income Cumulative Investment Income 17 YOUR TAX DOLLARS AT WORK

21 Debt Palm Beach County borrows money, or issues bonds to fund projects or purchases. These bonds are sold or issued, allowing the County to spread repayment over a long period of time, sharing the cost with current and future taxpayers. The County has earned the highest bond rating, AAA, allowing it to borrow money at lower interest rates, ultimately saving the taxpayers money. The County s outstanding debt increased 2.5 percent in FY FY 2016 Highlights: Issued $18.8 million of new Non-Ad Valorem debt for MAX Planck. Issued $122 million of new Non- Ad Valorem debt for the County s Professional Sports Franchise Facility. Issued $121 million Revenue Refunding bonds partially refunding the 2008 jail expansion project, saving the County $33 million in debt service payments over the next 22 years. Issued $57 million Airport System Revenue Refunding bonds, saving the Airport Department $20 million in debt service payments over the next 20 years. For more information on County debt, including how it is managed and its effect on the County s financial health, please read our Annual Debt Guide at $1,400,000,000 $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,000,000 $200,000,000 $400,000,000 $350,000,000 $300,000,000 $250,000,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 $0 $0 Debt Outstanding FY 2012-FY General Obligation Bonds Revenue Bonds Non-Ad Valorem Revenue Bonds Notes and Loans Payable Debt Service Payments FY 2016-FY 2046 (If no new debt is added) Principal Interest YOUR TAX DOLLARS AT WORK 18

22 What the County Owns and Owes The Condensed Statement of Net Position, or balance sheet, is a summary of everything the County owns (assets) and owes (liabilities). By the end of FY 2016 the County s net position increased $33 million from the prior year, with governmental activities decreasing $40 million and business-type activities increasing $73 million. Net Position at a Glance Net Position = Assets & Deferred Outflows less Liabilities & Deferred Inflows = Financial Health Net Investment in Capital Assets: Investment in capital assets less accumulated depreciation and any outstanding debt used to acquire these assets. Restricted: Amounts not available for County use due to external restrictions imposed by grantors, contributors, laws and/or regulations of other governments. Unrestricted: Remaining amounts available for the County to use for operations. Deficit balances are a result of GASB Statement 68, requiring the County to record its proportionate share of net pension liabilities for its retirement plans. Condensed Statement of Net Position: September 30, 2016 Governmental Activities Business-Type Activities Totals 2016 Total Total 2014 Assets Current and Other Assets $1,415,169,966 $518,842,740 $1,934,012,706 $1,853,276,433 $1,809,729,038 Capital Assets $2,506,639,602 $1,452,310,834 $3,958,950,436 $3,834,089,151 $3,792,990,899 Total Assets $3,921,809,568 $1,971,153,574 $5,892,963,142 $5,687,365,584 $5,602,719,937 Deferred Outflows $649,043,696 $27,367,302 $676,410,998 $310,494,471 $101,185,873 Liabilities Current $270,372,458 $56,093,897 $326,466,355 $294,965,813 $328,768,811 Long-term Debt Due in More than One Year $1,391,496,687 $266,972,335 $1,658,469,022 $1,561,896,742 $1,565,367,726 Net Pension Liability $1,115,065,863 $35,112,484 $1,150,178,347 $664,353,197 $420,568,904 Total Liabilities $2,776,935,008 $358,178,716 $3,135,113,724 $2,521,215,752 $2,314,705,441 Deferred Inflows $212,917,947 $7,104,560 $220,022,507 $295,333,638 $379,125,014 Net Position Net Investment in Capital Assets $1,624,248,207 $1,201,160,231 $2,825,408,438 $2,737,958,221 $2,641,043,757 Restricted $551,402,073 $74,870,540 $626,272,613 $620,997,049 $626,541,481 Unrestricted ($594,649,971) $357,206,829 ($237,443,142) ($177,644,605) ($257,509,883) Total Net Position $1,581,000,309 $1,633,237,600 $3,214,237,909 $3,181,310,665 $3,010,075,355 1 Adjusted for reclassification of goodwill. 19 YOUR TAX DOLLARS AT WORK

23 Government Officials as of September 30, 2016 Constitutional Officers Clerk & Comptroller - Sharon R. Bock, Esq Property Appraiser - Gary R. Nikolits, CFA Sheriff - Ric L. Bradshaw Supervisor of Elections - Susan Bucher Tax Collector - Anne M. Gannon *Note: On August 30, 2016, voters elected Dorothy Jacks as Property Appraiser. Board of County Commissioners discover.pbcgov.org District 1 - Hal R. Valeche District 2 - Paulette Burdick District 3 - Shelley Vana District 5 - Mary Lou Berger District 6 - Melissa McKinlay District 7 - Priscilla A. Taylor District 4 - Steven L. Abrams County Administrator - Verdenia C. Baker *Note: On November 4, 2016, voters elected Dave Kerner as commissioner of District 3 and Mack Bernard as commissioner of District 7. Above: Red Reef Park. Photos on pages 2-13 & 20 courtesy of Discover Palm Beach County. CONTACT INFORMATION 20

24 SHARON R. BOCK Clerk & Comptroller Palm Beach County