NORTHSTAR COMMUNITY SERVICES DISTRICT NOTICE OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS

Transcription

1 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTICE OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS DATE: DECEMBER 20, 2017 TIME: 9:00 A.M. PLACE: NORTHSTAR COMMUNITY SERVICES DISTRICT ADMINISTRATIVE/ENGINEERING OFFICE, 900 NORTHSTAR DRIVE, TRUCKEE, CA Director Seelig will participate in the meeting by teleconference from750 Black Oak Lane, Casita in back, Nipomo, Ca 93444, in accordance with Government Code section 54953(b)(3). This location is accessible to the public, and persons attending at this location will be afforded an opportunity to address the board of directors. CALL TO ORDER, PLEDGE OF ALLEGIANCE, ROLL CALL PUBLIC COMMENTS Any member of the public may address the Board after roll call on any topic related to the District that is not on the agenda. Public comment will be taken on agenda action items immediately prior to Board action. CONSENT CALENDAR 1. Discussion and Approval of the following: November 15, 2017 Regular Meeting Minutes. Approval of Claims and Demands Paid and Unpaid. RECURRING BUSINESS 2. Meetings attended by NCSD Board Members Discussion. 3. Mountainside Partners Update. 4. Northstar Property Owners Association Update. 5. Northstar California/Vail Update. NEW BUSINESS 6. Board of Directors Appointment of 2018 Officers Discussion Action :15 A.M. FY Audit Presentation David Becker Discussion. 8. Acceptance of FY Audited Financial Statements Discussion Action. 9. Potential Sales Tax Initiative to Fund Trail Maintenance & Construction Discussion. 10. Highlands PRD Chain Control Gate Power Service Installation Notice of Completion Discussion Action. 11. Highlands PRD Chain Control Gate Gate System Materials Purchase Discussion Action. 12. Highlands PRD Chain Control Gate Installation Services Discussion Action. 13. Schaffer s Mill Phase 3C Facilities Agreement Discussion Action. 14. Resolution 17-XX Accepting Offer of Dedication of Water Facilities Schaffer s Mill Phase 3B Tract No. ESD Discussion Action.

2 15. Fire Department Resolution 17-XX Grant Agreement with Department of Forestry and Fire Protection Discussion Action. DIRECTOR REPORTS 16. Individual directors may give brief reports on miscellaneous items for the information of the other members of the Board and NCSD staff. No action will be taken. OPERATION REPORTS 17. General Manager s Report Staudenmayer Discussion. 18. Fire Department s Report Shadowens Discussion. 19. Public Works Report Martin/Ryan Discussion. ADJOURNMENT Items may not be taken in the order listed above. In compliance with the Americans with Disabilities Act, if you are a disabled person and you need a disability-related modification or accommodation to participate in this meeting, then please contact James Bowling at (530) or (530) (fax). Requests must be made as early as possible and at least one full business day before the start of the meeting. NCSD will endeavor to accommodate requests made with less notice than that. N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 2 O F 2

3 AGENDA ITEM #1 The Consent Calendar covers the following: November 15, 2017 Regular Meeting Minutes. Approval of Claims and Demands Paid and Unpaid.

4 MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS NOVEMBER 15, :00 A.M. ADMINISTRATION/ENGINEERING OFFICE President Green called the meeting to order at 9:00 a.m. Wednesday, November 15, Roll call and Pledge of Allegiance followed. DIRECTORS PRESENT: DIRECTORS ABSENT: STAFF PRESENT: OTHERS PRESENT: Green, Seelig, Ives, Stewart, Cravens None Staudenmayer, Martin, Rosenthal, Shadowens, Ryan, Bowling John Jewett, Jerusha Hall, Mike Milliken, Geoff Stephens, Tony Karwowski PUBLIC COMMENT There was no public comment. CONSENT CALENDAR Director Seelig moved to approve the following consent calendar items: o o October 18, 2017 Regular Meeting Minutes. Approval of Claims and Demands Paid and Unpaid. Director Ives seconded, roll call was taken. Yes: Directors Green, Ives, Seelig, Stewart and Cravens. Noes: None. Absent: None. The motion carried. RECURRING BUSINESS MEETINGS ATTENDED BY NCSD BOARD MEMBERS. President Green reviewed the Truckee-Tahoe Airport meeting she attended. MOUNTAINSIDE PARTNERS UPDATE John Jewett provided the following Mountainside Partners update: The Boulders project is still on track and turning them over is scheduled for February. Mountainside s financial partners have decided to sell their Tahoe asset. Mountainside is expecting to have a new capital partner in the next six months to a year. NPOA UPDATE Geoff Stephens provided the following NPOA update. The next regularly scheduled meeting is Saturday, December 2 nd. Staff is now preparing for winter operations and prepping for 2018 projects. NORTHSTAR CALIFORNIA/VAIL UPDATE Jerusha Hall provided the following Northstar California/Vail update: Northstar is still planning to open prior to the Thanksgiving holiday. Heavenly is scheduled to open this Friday and Kirkwood is scheduled to open next Wednesday.

5 Staff is currently working on long term solutions regarding affordable housing issues. Director Seelig inquired if there were any plans for summer improvement projects that were included in the mountain masterplan. Ms. Hall stated that some submittals and preliminary projected costs have been put together however they will probably be scheduled for the 2019 summer. Ms. Hall introduced Tony Karwowski of Vail. Ms. Hall stated that Mr. Karwowski is the Director of Base Area Operations and the Village at Northstar. Mr. Karwowski stated that he has been with Northstar for eleven years and he is responsible for thirteen departments across the resort including transportation and parking. Mr. Karwowski stated that his team is dedicated to mitigating issues related to coming to and leaving the resort. Mr. Karwowski stated that they have a parking and traffic mitigation plan that was submitted with the masterplan for approval with Placer County. Mr. Karwowski stated that the plan is considered a living document and it is reviewed by staff frequently for possible improvements. Mr. Karwowski reviewed several aspects of the plan along with some of the changes they have implemented to improve ingress/egress of the roadways based on last year s winter. Mr. Karwowski stated that the three traffic control devices at Big Springs, the round-a-bout and the stoplight at SR 267 are working as they are designed to. The majority of the congestion issues are coming from SR 267. These issues include; road closures, chain check, accidents, etc. Additionally, the traffic signals and the timing of the signals located on SR 267 have contributed to the congestion due to the fact that the signals do not talk to each other. Mr. Karwowski stated that one of their goals is to bring in all of the partners and stakeholders together to work on viable solutions. Lengthy discussion regarding possible solutions including; shuttle s, widening Northstar Drive and contacting the California Highway Patrol (CHP) ensued. The Board thanked Mr. Karwowski for attending today s meeting. NEW BUSINESS APPROVAL OF PURCHASE TRACKLESS BLOWER Utility Operations Manager (UOM) Matt Ryan stated that the need for an additional piece of snow removal equipment at the Martis Valley Water System (MVWS) was recognized last winter. Last year s heavy snow made it difficult to provide quality service and extremely difficult to access the facilities in emergencies. UOM Ryan stated that the piece of equipment that is under consideration for purchase is a small self-contained snow blower identical to the two currently owned by the District. This snow blower will primarily be designated to clear snow from around the facilities within the MVWS. UOM Ryan stated that it will also be used to help clear roadways within the Northstar area as needed. UOM Ryan stated that 75% of this purchase will be covered by the Martis Valley Water System Maintenance Building project and the remaining 25% will be covered through the District s general fund. UOM Ryan recommended purchasing the Trackless MT Model Snow Blower from Snoquip in the amount of $81, Director Ives moved to approve the purchase of the Trackless MT Model Snow Blower from Snoquip with costs not to exceed $81, Director Stewart seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. PREPAID IT SUPPORT SERVICES District Engineer (DE) Eric Martin reviewed the proposal from Nims & Associates for Information Technology (IT) Support Services. DE Martin stated that by pre-purchasing blocks of time totaling 100 hours or more, the District saves 10% off Nims standard hourly rates. DE Martin recommended the District pre-purchase approximately one year s worth of IT support (165 hours) at an hourly rate of $ N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 2 O F 5

6 Director Seelig moved to approve the proposal from Nims & Associates for the purchase of 165 hours of IT Support Services with costs not to exceed $20, Director Ives seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. UTILITY VEHICLE PURCHASE FORD F150 Utility Operations Manager (UOM) Matt Ryan stated that the Utilities Department has an aging fleet and that many of the vehicles have already gone past their original expected useful life. UOM Ryan stated that the vehicle being replaced is a 2003 Chevrolet S-10. UOM Ryan stated that he received a quote for an F150 in the amount of $28, Director Stewart moved to approve the purchase of the Ford F150 with costs not to exceed $28, Director Ives seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. APPROVAL OF PROPOSAL FROM FIRETRUCKS UNLIMITED TO REFURBISH ENGINE 31 Chief Shadowens stated that the fire engine at station 31 has reached its useful life of fifteen years as a first out apparatus. Chief Shadowens stated in lieu of purchasing a new engine he would recommend performing a refurbish on the engine. While the fire engine is starting to show signs of wear, and needs some components replaced, all major mechanical components such as engine, transmission, etc., are still very mechanically sound. Chief Shadowens stated that he received no bids for the refurbish work to be performed. However he did receive one proposal from Firetrucks Unlimited in the amount of $231,940. After a meeting with staff from Firetrucks Unlimited Chief Shadowens made several changes to the proposal which lowered the price. Chief Shadowens recommended approving the proposal from Firetrucks Unlimited in the amount of $189, with additional contingency of $12, Director Ives moved to approve the proposal from Firetrucks Unlimited in the amount of $189,612 with an additional contingency of $12,000. Director Stewart seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. APPROVAL OF GRANT CONTRACT FOR CALIFORNIA FIRE SAFE COUNSEL Chief Shadowens reviewed the grant from the California Safe Council. Chief Shadowens stated that in October of 2017, the Northstar FD was successful in receiving a grant in the amount of $32,250 from the California Fire Safe Council for the Chief Shadowens stated that a new project focus has been created from this grant by working in a partnership with the Community of Martis Camp and Truckee Fire. This grant project will create a acre fuels buffer on DMB Highlands property (Martis Camp) by creating a fuels buffer along the central/western portion of the Northstar CSD/Martis Camp boundary. Chief Shadowens stated that the hard match grant contribution, which is a cash dollar contribution for contractual fuels reduction labor will be funded by Martis Camp. The Northstar FD will be contributing soft match costs such as forester labor, and the contribution of chipper-31 and supplies to facilitate the grant. Chief Shadowens recommended the Board approve the grant from the Fire Safe Counsel in the amount of $32,250. Director Seelig moved to approve the grant proposal from the Fire Safe Counsel in the amount of $32,250. Director Ives seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. 10:38 A.M. RECESS 10:50 A.M. REGULAR MEETING RESUMED FUNDING FOR ANNUAL HOLIDAY PARTY Director of Human Resources (DHR) James Bowling reviewed the funding request for the District s annual holiday party. DHR Bowling stated that the District s holiday party will be held at the Alpine Club at the Northstar Village at N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 3 O F 5

7 6:30 p.m. on December 2 nd. The cost of the party should be approximately the same as last year s event. DHR Bowling recommended the Board approve funding for the holiday party with costs not to exceed $7,000. Director Seelig moved to approve the funding of the District s holiday party with costs not to exceed $7,000. Director Ives seconded, roll call was taken. Yes: Directors Ives, Cravens, Seelig, Stewart and Green. Noes: None. Abstain: None. Absent: None. The motion carried. NORTHSTAR FIRE DEPARTMENT EMERGENCY PREPAREDNESS AND EVACUATION PUBLIC OUTREACH Chief Shadowens stated as a follow up to last month s meeting he was hoping that the Board could provide additional direction regarding a public outreach plan. A brief discussion ensued regarding the best way to communicate the District s emergency preparedness and evacuation plan to the property owners within Northstar. The Board and staff discussed the possibility of the FD performing neighborhood meetings as one of the best ways to reach out to the public. The Board and staff discussed the best way to use the FD siren and how to familiarize homeowners with it. GM Staudenmayer suggested including a raffle to incentivize homeowners to come out and participate. Chief Shadowens agreed that a raffle would help provide more homeowner participation. The Board agreed that the FD should schedule neighborhood meetings beginning with the Memorial Day Weekend. DIRECTOR REPORTS There was no Director Reports. GENERAL MANAGER S REPORT STAUDENMAYER GM Staudenmayer provided the following report: GM Staudenmayer stated that the North Lake Tahoe Tourism Master Plan identifies visitor activities and facilities, transit and marketing/visitor information priorities for the North Lake Tahoe region. The Tier 1 Priorities identified in the plan have an associated revenue shortfall of approximately $12.4 million/year. The funding gap that is associated with trails and other similar visitor facilities is approximately $7.1 million/year. In an effort to close the funding gap the North Lake Tahoe Resort Association (NLTRA) is looking into the possibility of increasing the Transient Occupancy Tax (TOT) and/or a potential ½ percent sales tax. A meeting has been scheduled for November 17, to discuss the analysis, process and structure/governance of any tax proceeds. Mountainside Partners is marketing the sale of the company s remaining assets. The assets include the following; Mountainside at Northstar (formerly The Highlands ), Martis Valley West Parcel and the Tahoe Mountain Club. The District is working with bond counsel to assess potential impacts and modifications to outstanding CFD debt that may be advisable for the security of bond holders and potential purchasers. FIRE DEPARTMENT SHADOWENS Chief Shadowens provided the following report: Chief Shadowens attended an Eastern Placer County JPA Chiefs meeting. One of the topics discussed at the meeting was the possibility of a regional training facility. The local chiefs are looking to obtain a piece of property from the Truckee Tahoe Airport for the proposed site. Chief Shadowens and Captain Coleman took a one day trip to Las Vegas to meet with the vendor of a fire truck refurbishment company. Yapacopia PBC (Public Benefit Corporation), in conjunction with the Insurance Sub Group of the Governor s Tree Mortality Task Force, has launched a new online service to help Placer County residents obtain home insurance. The website is called the Sierra Insurance Finder ( The service was designed specifically to create a pathway to home insurance for residents who have been non-renewed and/or are having difficulty finding insurance. PUBLIC WORKS REPORT MARTIN/RYAN DE Martin and UOM Ryan provided the following report: N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 4 O F 5

8 Power service design drawings were received from Liberty Utilities for the recycling area gate. The power service as proposed is cost prohibitive, so staff has decided to seek out alternative power delivery. Staff coordinated responses to Placer County comments for the Minor Use Permit regarding the former administration building. A hearing for the permit has been tentatively scheduled by the County on December 6 th. The Martis Valley Trail Segments 1B-2 and 3A Environmental Assessment (EA) was resubmitted to the Corps on October 30. The document is currently under review by the Corps Office of Counsel. FINANCE AND ADMINISTRATION REPORT 1 ST QUARTER FINANCIAL REPORT Director of Finance and Administration (DFA) Greg Rosenthal provided the following report: Through the 3rd month of fiscal year , the District in totality is under the year-to-date (YTD) budgeted revenue and YTD budgeted expense totals. The Total YTD revenues were $296,347 (7.7%) under the YTD budget due mostly to reimbursable revenue being $601,279 (86.2%) under the YTD budget. The total YTD expenses were $622,354 (16.5%) under the YTD budget due mostly to Reimbursable Expense being $558,409 (82.3%) under the YTD budget. DFA Rosenthal stated that when the impacts of Reimbursable and Capital activities are removed, the District is over year-to-date (YTD) budgeted revenue by $247,066 (7.9%) and over year-to-date budgeted expense totals by $26,487 (0.9%). As a result, District revenues exceed expenses by $854,919 after adding back depreciation. ADJOURNMENT: The Regular Meeting adjourned at 12:29 A.M. Respectfully submitted, Jeann Green, President of the Board James Bowling, Secretary of the Board N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 5 O F 5

9 Approval of Claims & Demands Paid and Unpaid DATE: December 20, 2017 TO: FROM: Board of Directors Greg Rosenthal, Director of Finance and Administration DISCUSSION: The attachment, Warrant Register PAID, shows all checks written to pay claims and demands received subsequent to the previous board meeting. This is consistent with Resolution 16-21, which states that checks to pay claims and demands need not be approved by the board of directors before payment if the District Treasurer has determined that the claims and demands conform to the District s approved budget. The attachment, Warrant Register UNPAID, shows all invoices that require board approval before payment. Pursuant to Resolution 16-21, claims and demands must be approved by the board of directors before payment if the District Treasurer has determined that the claims and demands do not conform to the District s approved budget. RECOMMENDATION: Approve Claims & Demands Paid and Unpaid ATTACHMENTS: Warrant Register PAID Warrant Register - UNPAID DATE PREPARED: December 15, 2017

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37 Unpaid Items - December 2017

38 AGENDA ITEM #2 MEETINGS ATTENDED BY NCSD BOARD MEMBERS There is no written report for this agenda item.

39 AGENDA ITEM #3 MOUNTAINSIDE PARTNERS UPDATE There is no written report for this agenda item.

40 AGENDA ITEM #4 NPOA UPDATE There is no written report for this agenda item.

41 AGENDA ITEM #5 NORTHSTAR CALIFORNIA/VAIL UPDATE There is no written report for this agenda item.

42 BOARD OF DIRECTORS APPOINTMENT OF 2018 OFFICERS Date December 20, 2017 To From Board of Directors James Bowling, Secretary of the Board of Directors Background: Pursuant to the NCSD Board Handbook, annually, at the December Board meeting is when action is to be taken to appoint the officers of the Northstar Community Services District Board of Directors. The three positions for nomination include the Board President, Board Vice- President and the Board Financial Representative. Discussion: The Secretary of the Board will open nominations for each position. A motion and a vote by the directors will follow each nomination. Attachments: None

43 N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 2 O F 2

44 FY Audit Presentation DATE: December 20, 2017 TO: FROM: Board of Directors Greg Rosenthal, Director of Finance and Administration SUMMARY: David Becker, Partner at James Marta and Company, will provide a presentation on the results of the financial audit as he has done in the past. His presentation has been included as a part of this board report. RECOMMENDATION: None FISCAL IMPACTS/COSTS: None ATTACHMENTS: FY Audit Presentation DATE PREPARED: December 15, 2017

45 James Marta & Company LLP Certified Public Accountants Accounting, Auditing, Consulting, and Tax Northstar Community Services District Year Ended June 30, 2017 Financial Audit Results Presented by David Becker, CPA Partner

46 Audit Summary Our audit opinion is Unmodified Pg 1-3 Management Discussion & Analysis Pg 4-12 Net Pension Liability $5M (+$1M) James Marta & Company LLP Certified Public Accountants 2

47 Financial Results Increase to net position (equity) Governmental activities +$1M Business-type activities +$1.9M Individual fund results General +$842K Capital Projects $7K Building (-$843) Northstar Water +$818K Martis Valley Water +$42K Sewer +$1M Solid Waste +$11K James Marta & Company LLP Certified Public Accountants 3

48 General Fund Balance Sheet James Marta & Company LLP Certified Public Accountants 4

49 Statement of Net Position Water & Sewer James Marta & Company LLP Certified Public Accountants 5

50 Capital Assets Water & Sewer James Marta & Company LLP Certified Public Accountants 6

51 Capital Assets General Government James Marta & Company LLP Certified Public Accountants 7

52 Additional Communications Along with the audit report, there are two corresponding letters: Report on Internal controls No deficiencies identified Communication with those charged with governance Significant issues - None Audit adjustments - Attached Management representations New accounting standards GASB 75 Accounting and reporting for OPEB Effective for fiscal year James Marta & Company LLP Certified Public Accountants 8

53 Overall Comments Equity position Gov t Wide $96.1M ($10.2M unrestricted) General fund $7.3M ($5.5M unassigned) Water & Sewer $66.6M ($5.1M unrestricted) Improved financial position Excellent management team James Marta & Company LLP Certified Public Accountants 9

54 Acceptance of the FY Audited Financial Statements DATE: December 20, 2017 TO: FROM: Board of Directors Greg Rosenthal, Director of Finance and Administration SUMMARY: Attached are the audited financial statements of the District for the fiscal year ending June These are the same statements that were sent electronically to Directors along with the Communication Letter and Internal Control Compliance Letter in November. RECOMMENDATION: Accept the FY Audited Financial Statements FISCAL IMPACTS/COSTS: None ATTACHMENTS: FY Audited Financial Statements DATE PREPARED: December 15, 2017

55 NORTHSTAR COMMUNITY SERVICES DISTRICT FINANCIAL STATEMENTS WITH INDEPENDENT AUDITOR'S REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2017 JAMES MARTA & COMPANY LLP CERTIFIED PUBLIC ACCOUNTANTS 701 HOWE AVENUE, E3 SACRAMENTO, CA (916) (916) FAX

56 NORTHSTAR COMMUNITY SERVICES DISTRICT JUNE 30, 2017 BOARD OF DIRECTORS Jeann Green - President Frank Seelig - Director Nancy Ives - Director Cathy Stewart Director Dee Cravens Director * * * * General Manager Mike Staudenmayer Director of Finance and Administration Greg Rosenthal

57 NORTHSTAR COMMUNITY SERVICES DISTRICT TABLE OF CONTENTS JUNE 30, 2017 Independent Auditor s Report 1 Management s Discussion and Analysis 4 BASIC FINANCIAL STATEMENTS Government-Wide Financial Statements Statement of Net Position 13 Statement of Activities 14 Fund Financial Statements Balance Sheet Governmental Funds 15 Reconciliation of the Governmental Funds Balance Sheet To the Statement of Net Position 16 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 17 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities 18 Statement of Net Position Proprietary Enterprise Funds 19 Statement of Revenues, Expenses and Changes in Net Position Proprietary Enterprise Funds 20 Statement of Cash Flows Proprietary Enterprise Funds 21 Statement of Net Position Internal Service Funds 22 Statement of Revenues, Expenses and Changes in Net Position Internal Service Funds 23 Statement of Cash Flows Internal Service Funds 24 Statement of Net Position Fiduciary Funds 25 Notes to the Basic Financial Statements 26 PAGE

58 NORTHSTAR COMMUNITY SERVICES DISTRICT TABLE OF CONTENTS JUNE 30, 2017 REQUIRED SUPPLEMENTARY INFORMATION Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual General Fund 50 Schedule of Funding Progress Other Postemployment Benefits 51 Schedule of Proportionate Share of the Net Pension Liability 52 Schedule of Pension Contributions 53 Notes to Required Supplementary Information 54 SUPPLEMENTARY INFORMATION Statement of Changes in Assets and Liabilities Fiduciary Funds 56

59 James Marta & Company LLP Certified Public Accountants Accounting, Auditing, Consulting, and Tax Board of Directors Northstar Community Services District Truckee, California Report on the Financial Statements INDEPENDENT AUDITOR'S REPORT We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of Northstar Community Services District (the District ), as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the District s basic financial statements as listed in the table of contents. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States and the State Controller s Minimum Audit Requirements for California Special Districts. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. 701 Howe Avenue, Suite E3, Sacramento, CA (916) fax (916) jmarta@jpmcpa.com 1

60 Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund and the aggregate remaining fund information of the Northstar Community Services District as of June 30, 2017, and the respective changes in financial position and cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management s Discussion and Analysis, Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual General Fund, Schedule of Funding Progress Other Postemployment Benefits, Schedule of Proportionate Share of the Net Pension Liability, and the Schedule of Pension Contributions be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the District s basic financial statements. The supplementary information, as listed in the table of contents, is presented for purposes of additional analysis and is not a required part of the basic financial statements. The supplementary information, which consists of the statement of changes in assets and liabilities for the fiduciary funds, is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information, which consists of the Statement of Changes in Assets and Liabilities for the fiduciary funds, is fairly stated, in all material respects, in relation to the basic financial statements as a whole. 2

61 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 30, 2017 on our consideration of the District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District s internal control over financial reporting and compliance. James Marta & Company LLP Certified Public Accountants Sacramento, California November 30,

62 MANAGEMENT S DISCUSSION AND ANALYSIS

63 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 This discussion and analysis section of the Northstar Community Services District s (District or NCSD) Financial Statements is intended to provide a narrative overview and analysis of the basic financial activities of the District as of and for the year ended June 30, Please read it in conjunction with the District's financial statements, which follow this section. FINANCIAL HIGHLIGHTS Government-wide Total net position at June 30, 2017 $ 96,156,010 Total revenue: 14,163,886 Total expense: 11,214,463 Total depreciation expense: 2,024,334 Business-Type Activities Water Total revenue: $ 4,374,239 Total expense: 3,513,950 Sewer Total revenue: 2,993,673 Total expense: 1,949,864 Solid Waste Total revenue: 471,799 Total expense: 460,233 Governmental Activities Total revenue: $ 6,324,175 Total expense: 5,290,416 OVERVIEW OF THE FINANCIAL STATEMENTS Government-wide Financial Statements present a broad overview of the District's finances. Within this view, all District operations are categorized and reported as either governmental or business-type activities. These government-wide statements are designed to be more business-like in that all activities are consolidated and provide a snapshot of the District as a whole. The STATEMENT OF NET POSITION focuses on resources available for future operations. In simple terms, this statement presents a snapshot of the total assets and total liabilities of the District and the net difference. The net difference is further separated into amounts invested in capital assets, net of related debt and amounts that are unrestricted. The STATEMENT OF ACTIVITIES focuses on the costs of the District's programs and the extent to which the programs rely on property taxes and other revenues. This statement simplifies the user's analysis when determining the extent to which programs are self-supporting and/or subsidized by general revenue. 4

64 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 Both previously mentioned government-wide financial statements distinguish functions of the District that are principally supported by taxes (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the District include general government, fire, fuels management, roads maintenance, snow removal, and trails maintenance. The business-type activities of the District include water, sewer, and solid waste. Fund Financial Statements focus on the individual parts of the District, reporting the operations in more detail than the government-wide statements by providing information about the District s most significant funds. The fund financial statements separately focus on governmental funds, proprietary funds, and fiduciary funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental funds financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Because the focus of governmental funds is narrower than that of the government wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government wide financial statements to gain a better understanding of the long term impact of near term financing decisions. Both the BALANCE SHEET - GOVERNMENTAL FUNDS and the STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS provide a reconciliation to facilitate this comparison between governmental funds and the governmental activities represented by the government wide financial statements. Information is presented separately in the BALANCE SHEET - GOVERNMENTAL FUNDS and the STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS for the General Fund and the Capital Projects Fund. The General Fund accounts for all financial resources except those required to be accounted for in another fund. The Capital Projects Fund accounts for the financial activities of the Northstar Community Services District Community Facilities District #1 (CFD), whose purpose is the acquisition and construction of major capital facilities within the District. Proprietary Funds are used to account for activities by which the District provides goods or services on a fee basis. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The types of proprietary funds utilized by the District are enterprise funds and internal service funds. o Enterprise funds provide goods or services to the public for a fee. Enterprise funds report on the same business-type activities shown in the government-wide financial statements. The intent is that the cost of providing services will be financed or recovered primarily through user charges. The District uses enterprise funds to account for water, sewer, and solid waste operations. 5

65 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 o Internal service funds account for goods and services provided on a cost-reimbursement basis by one department to another department within the District. The District uses internal service funds to account for Engineering & Utility Operations, Fleet, and Administrative Operations. Fiduciary Funds are used to account for resources held for the benefit of parties outside the District. Fiduciary funds are not reflected in the government-wide financial statements because the resources of these funds are not available to support the District s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The types of fiduciary funds utilized by the District are agency funds. Agency Funds are used to account for the assets held by the District as an agent for the CFD. Notes to the basic financial statements provide additional disclosures required by governmental accounting standards and provide information to assist the reader in understanding the District's financial condition. Required supplementary information provides a budgetary comparison schedule for the General Fund in the STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL GENERAL FUND. It also provides a schedule showing the trend of the actuarially accrued liability for benefits compared to the actuarial value of accumulated plan assets in the SCHEDULE OF FUNDING PROGRESS FOR OTHER POSTEMPLOYMENT BENEFITS. The Governmental Accounting Standards Board set out to improve pension accounting and financial reporting by state and local governments through Statement Number 68 (GASB 68). GASB 68 took effect for fiscal years beginning after June 15, As a result of the implementation of GASB 68, two schedules were added to the required supplementary information section. The two schedules are the SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY and the SCHEDULE OF PENSION CONTRIBUTIONS. Both are 10 year schedules and will present years as they become available, until 10 years are shown. Supplementary information provides a schedule of receipt and disbursement activity for the 2005 and 2006 series bonds of the CFD as well as the subsequent 2014 Refunding Bonds represented by the STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FOR FIDUCIARY FUNDS. FINANCIAL ANALYSIS OF THE DISTRICT One of the most important questions asked about the District's finances is "Is the District as a whole better off or worse off as a result of this year's activities?" The statement of activities reports information about the District's activities in a way that will help answer this question. The statement of net position presents information on all of the District's assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating. 6

66 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 The STATEMENT OF ACTIVITIES and the STATEMENT OF NET POSITION report the net position and the changes in net position for the District. However, considerations should also be given to other non-financial factors such as changes in economic conditions, population growth, and new or changed governmental legislation. A summary of the District's STATEMENT OF NET POSITION comparing the current and prior fiscal years is presented in Table A-1. Table A-1 Statement of Net Position 6/30/2017 Governmental Activities Business-type Activities Totals ASSETS Current assets $ 10,933,019 $ 10,859,522 $ 21,820,675 $ 19,543,743 $ 32,753,694 $ 30,403,265 Capital assets 28,117,133 28,712,776 52,292,491 50,742,843 80,409,624 79,455,619 Total Assets 39,050,152 39,572,298 74,113,166 70,286, ,163, ,858,884 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows on pensions $ 3,924,006 $ 1,769,328 $ - $ - $ 3,924,006 $ 1,769,328 LIABILITIES Current liabilities 438,833 1,340,797 7,466,692 5,555,776 7,905,525 6,896,573 Noncurrent liabilities 11,652,303 10,424, ,652,303 10,424,495 Total liabilities 12,091,136 11,765,292 7,466,692 5,555,776 19,557,828 17,321,068 DEFERRED INFLOWS OF RESOURCES Deferred inflows on pensions $ 1,373,486 $ 1,100,557 $ - $ - $ 1,373,486 $ 1,100,557 NET POSITION Investment in capital assets, net of related debt 23,642,133 24,142,776 52,292,491 50,742,843 75,934,624 74,885,619 Restricted for capital replacement ,035,809-10,035,809 - Unrestricted 5,867,403 4,333,001 4,318,174 13,987,967 10,185,577 18,320,968 Total net position $ 29,509,536 $ 28,475,777 $ 66,646,474 $ 64,730,810 $ 96,156,010 $ 93,206,587 As shown by Table A-1, total net position amounted to $96.2MM in fiscal year The major component of this category is Investment in capital assets, net of related debt, which represents the District s investment in capital assets, net of the amount borrowed to purchase those assets. Total net position increased by $2.9MM mostly due to an increase in current and capital assets for business-type activities. Total assets for Governmental Activities decreased $522K. This was due to a combination of a nominal increase in capital assets paired with the recognition of accumulated depreciation for the year under audit. Total assets for business-type activities increased $3.8MM mainly due to increases in Property, Land & Equipment and investments resulting from the regular investment of enterprise capital fees and charges. 7

67 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 Current liabilities for governmental activities increased $326K and business-type activities increased $1.9MM. Both increases are mainly because of amounts due to other funds. These increases in liability of the amount due to other funds correspond to the current assets of the Internal Service Funds, which show an increased asset, due from other funds. A condensed version of the Statement of Activities comparing the current and prior fiscal years is presented in Table A-2. Table A-2 Statement of Activities 6/30/2017 Governmental Activities Business-type Activities Totals REVENUE General Revenue Property taxes $ 4,499,088 $ 4,459,378 $ 4,499,088 $ 4,459,378 Fuels management & streets assessments 669, , , ,492 Capital Contributions - - $ 1,141,677 $ 681,943 1,141, ,943 Interest earnings 45,566 57,400 96, , , ,508 Miscellaneous 101, ,489 93,135 19, , ,416 Total general revenue 5,315,314 5,466,759 1,330, ,978 6,646,232 6,337,737 Program Revenues Charges for services 461, ,881 6,657,648 6,111,927 7,118,709 6,709,808 Operating Grants amd Contributions 384,433 1,306,153 14, ,945 1,306,153 Total program revenue 845,494 1,904,034 6,672,160 6,111,927 7,517,654 8,015,961 Total revenue 6,160,808 7,370,793 8,003,078 6,982,905 14,163,886 14,353,698 EXPENSES General government 95, ,272 95, ,272 Public safety 4,011,997 4,512,891 4,011,997 4,512,891 Streets 237, , , ,876 Trails 319,271 1,161, ,271 1,161,091 Unallocated depreciation 625, , , ,325 Water, Sewer, and Solid Waste 5,924,047 5,140,225 5,924,047 5,140,225 Total expenses 5,290,416 7,030,455 5,924,047 5,140,225 11,214,463 12,170,680 OTHER SOURCES (USES) Transfers In (Out) 163,367 - (163,367) 30,050,711-30,050,711 CHANGE IN NET POSITION 1,033, ,338 1,915,664 31,893,391 2,949,423 32,233,729 NET POSITION, beginning of year 28,475,777 28,135,439 64,730,810 32,837,419 93,206,587 60,972,858 NET POSITION, end of year $ 29,509,536 $ 28,475,777 $ 66,646,474 $ 64,730,810 $ 96,156,010 $ 93,206,587 While the statement of net position shows the position of net assets, the statement of activities provides answers as to the nature and source of these changes. Governmental activities: General revenue from both property tax and fuels management and streets assessments increased 0.9% and 4.7%, respectively over the prior year amounts. However, general revenue as a whole was down 2.8% due to a decrease of $209K in miscellaneous revenue. 8

68 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 Program revenues decreased by 16.4%. This decrease is largely due to operating grants and contributions showing a 70.6% decrease over the prior year due to diminished grant activity within the trails division. Overall expenditures were down by 24.8%. This is mostly due to expenditures within the trails division being $841K less than the prior fiscal year. Business-Type activities: General revenue increased by 52.8% mainly due to a $460K increase in capital contributions while program revenues showed an increase of 14.6% mostly due to increases in fees for water, sewer, and solid waste services. Overall, expenses were 15.3% higher than the prior year. BUDGETARY HIGHLIGHTS Each year the District Board of Directors adopts an annual operating and capital budget. The operating budget includes proposed expenses and the means of financing them. The budget remains in effect the entire year but may be revised by the Board of Directors as required. Budget vs. actual reports are provided to the Board of Directors on a quarterly basis and to management on a monthly basis. Table A-3 shows current and prior fiscal year Budget vs. Actual comparison for the General Fund Table A-3 Budget vs. Actual - General Fund 6/30/2017 Variance Budget Actual Favorable / (Unfavorable) Revenue Taxes and assessments $ 5,269,200 $ 4,840,500 $ 5,168,557 $ 5,098,870 $ (100,643) $ 258,370 Fees and other non-tax revenue 52, , , , , ,814 Interest 24,700 36,500 38,322 52,726 13,622 16,226 Fire mitigation fees 6,000 6,000 36,132 10,804 30,132 4,804 Reimbursable revenues 1,268,017 1,158, ,433 1,306,153 (883,584) 147,569 Other 101, , , ,624 1,050 4,465 Total revenue 6,721,662 6,269,006 6,154,582 7,161,254 (567,080) 892,248 Expenditures General Government 105,500 48,200 95, ,991 10,199 (54,791) Public Safety 4,561,522 4,117,285 4,622,197 4,436,322 (60,675) (319,037) Streets 88, , , ,876 (149,828) (104,944) Trails 1,259,610 1,276, ,271 1,161, , ,059 Total expenditures 6,014,690 5,787,567 5,274,655 6,151, ,035 (363,713) Excess (deficiency) of revenue over expenditures before other sources 706, , ,927 1,009, , ,535 Other Sources Operating transfers from other sources in/(out) (38,143) - (38,143) Excess (deficiency) of revenue and other sources over expenditures $ 668,829 $ 481,439 $ 841,784 $ 1,009,974 $ 172,955 $ 528,535 9

69 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 The District budgeted $6.7MM in general fund revenue and recognized $6.2MM. The District budgeted $6.0MM in general fund expenditures and recognized $5.3MM. The budget to actual variance in revenue was mainly due to reimbursable revenues being $884K under budget due to grant funded construction within the trails division being less than expected. The $740K favorable budget to actual variance in expenditures was mainly due to decreased expenditures within the trails division as compared to budget. Overall, there is a favorable variance of $173K when comparing the general fund budgeted contributions to reserves to the actual contributions. 10

70 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 CAPITAL ASSETS A comparison of Capital Assets for the current and prior fiscal year is presented in Table A-4. Table A-4 Capital Assets at June 30, 2017 Dollar Percentage FY 2017 FY 2016 Change Change Governmental Activities Land $ 7,598,216 $ 7,598,216 $ - 0% Work in progress General fund Capital projects fund 117, ,341-0% Buildings and improvements 21,196,235 21,196,235-0% Equipment 1,444,771 1,426,465 18,306 1% Vehicles and equipment 3,630,028 3,630,028-0% Software 78,587 78,587-0% 34,065,178 34,046,872 18,306 0% Less accumulated depreciation (5,948,045) (5,334,096) (613,949) Governmental activities capital assets, net 28,117,133 28,712,776 (595,643) -2% Business-type Activities Land 748, ,907-0% Work in progress 2,151, ,940 1,692, % Building and improvements 20,336,985 20,337,281 (296) 0% Equipment 1,311,923 1,111, ,909 18% Vehicles and equipment 721, ,941 13,142 2% Software 258, , , % Water/sewer system 48,488,989 42,766,956 5,722,033 13% 74,017,755 66,242,641 7,775,114 12% Less accumulated depreciation (21,725,264) (15,499,798) (6,225,466) 40% Business-type activities capital assets, net 52,292,491 50,742,843 1,549,648 3% Totals $ 80,409,624 $ 79,455,619 $ 954,005 1% As indicated in Table A-4, the combined net capital assets of Governmental and Business-type Activities increased by $954K, after considering accumulated depreciation. Governmental activities show an increase of $18K before accumulated depreciation due to the purchase of capital equipment. 11

71 NORTHSTAR COMMUNITY SERVICES DISTRICT MANAGEMENT S DISCUSSION AND ANALYSIS JUNE 30, 2017 Business-type activities show an increase of $7.8MM before accumulated depreciation mostly due to recognizing the original cost of Martis Valley Water System assets rather than the book value upon acquisition as reported in the previous fiscal year. GENERAL LONG-TERM DEBT The District's long-term liabilities at year-end included Other Post-Employment Benefits (OPEB) for employees totaling $828K. There is no long-term portion of retiree termination benefits, with $15K due within one year. Long-term liabilities for estimated compensated absences totaled $1.4MM. Net pension liability amounts to $5.0MM. Lastly, the long-term liability of the NCSD Financing Authority (NCSD-FA), a joint exercise of Powers Authority (JPA) formed by the NCSD and the NCSD Community Facilities District #1 in 2015, totaled $4.5MM in general long-term debt with $95K being due within one year. DEBT WITHOUT GOVERNMENT COMMITTMENT During 2005 and 2006, bonded debt was issued by a special assessment district known as the Northstar Community Services District Community Facilities District #1 (NCSD CFD#1 or CFD) to finance infrastructure improvements and facilities within the Northstar area. In July of 2014, the NCSD CFD #1 issued Special Tax Refunding bonds to refund a portion of the 2005 and 2006 series bonds and cover the costs associated with the issue. The District has no legal responsibility with respect to the re-payment of the debt associated with either bond issue. However, the District is responsible for managing a portion of the construction and improvements financed by the CFD and it is also responsible as the CFD s agent for the receipts and disbursements of the CFD. At June 30, 2017, the outstanding principal amount of bonded debt outstanding for the CFD was $108.2MM. ECONOMIC FACTORS AND NEXT YEAR'S BUDGET AND RATES The District will continue to budget conservatively for general fund revenues in anticipation that the assessed value of property within the District will not increase significantly in the upcoming year. Business-type revenue is expected to increase due to the District is entering the third year of a five-year rate increase for Northstar Water, Sewer, and Solid Waste services, which also includes an increase in fees to support capital expenditures. The District will continue to be mindful of expenditures and look for ways to capitalize on trends that will allow for economies of scale and the more efficient use of resources. REQUEST FOR INFORMATION This financial report is designed to provide a general overview of the District s finances for all interested parties. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Greg Rosenthal, CPA, Director of Finance and Administration, Northstar Community Services District, 900 Northstar Drive, Truckee, California

72 BASIC FINANCIAL STATEMENTS

73 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF NET POSITION JUNE 30, 2017 Governmental Business-type Activities Activities Total ASSETS Cash and cash equivalents $ 947,870 $ 10,185,803 $ 11,133,673 Investments 1,560,908 10,653,329 12,214,237 Accounts receivable 282, ,312 1,006,548 Inventory 8,560-8,560 Due from other governments 249, , ,573 Due from enterprise funds 7,324,353-7,324,353 Prepaid expenses 559, , ,750 Capital assets, net 28,117,133 52,292,491 80,409,624 Total assets 39,050,152 74,113, ,163,318 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows on pensions 3,924,006-3,924,006 LIABILITIES Accounts payable 191, , ,648 Accrued wages and related items Accrued liabilities 69,026 39, ,105 Due to governmental funds - 7,324,353 7,324,353 Unearned revenue 68,000 3,000 71,000 Long-Term Liabilities: Due within one year 110, ,419 Due in longer than one year Net pension liability 5,049,758-5,049,758 Other long-term liabilities 6,602,545-6,602,545 Total liabilities 12,091,136 7,466,692 19,557,828 DEFERRED INFLOWS OF RESOURCES Deferred inflows on pensions 1,373,486-1,373,486 NET POSITION Net investment in capital assets 23,642,133 52,292,491 75,934,624 Restricted for capital projects - 10,035,809 10,035,809 Unrestricted 5,867,403 4,318,174 10,185,577 Total net position $ 29,509,536 $ 66,646,474 $ 96,156,010 The accompanying notes are an integral part of these financial statements. 13

74 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2017 Program Revenues Net (Expense) Revenue and Changes in Net Position Operating Business Charges for Grants and Governmental Type Functions Expenses Services Contributions Activities Activities Total Governmental activities: General government $ 95,301 $ - $ - $ (95,301) $ - $ (95,301) Public safety 4,011, ,061 51,408 (3,499,528) - (3,499,528) Streets 237, ,120 40,234-40,234 Trails 319,271-54,905 (264,366) - (264,366) Building Unallocated depreciation 625, (625,961) - (625,961) Total governmental activities $ 5,290,416 $ 461,061 $ 384,433 (4,444,922) - (4,444,922) Business-type activities: Water $ 3,513,950 $ 3,535,306 $ 14,512 35,868 35,868 Sewer 1,949,864 2,650, , ,679 Solid waste 460, ,799-11,566 11,566 Total business-type activities $ 5,924,047 $ 6,657,648 $ 14, , ,113 General revenues: Property taxes 4,499,088-4,499,088 Fuels management and streets assessments 669, ,469 Capital contributions - 1,141,677 1,141,677 Interest earnings 45,566 96, ,672 Miscellaneous revenue 101,191 93, ,326 Total general revenue 5,315,314 1,330,918 6,646,232 Interfund transfer 163,367 (163,367) - Change in net position 1,033,759 1,915,664 2,949,423 Net position, beginning 28,475,777 64,730,810 93,206,587 Net position, end of year $ 29,509,536 $ 66,646,474 $ 96,156,010 The accompanying notes are an integral part of these financial statements. 14

75 NORTHSTAR COMMUNITY SERVICES DISTRICT BALANCE SHEET - GOVERNMENTAL FUNDS JUNE 30, 2017 ASSETS Total Capital Projects Building Governmental General Fund Fund Fund Funds Assets Cash and cash equivalents $ 7,409,698 $ 1,311,726 $ 36 $ 8,721,460 Investments 1,560, ,560,908 Accounts receivables 266, ,917 Due from other governments 249, ,237 Prepaid expenses 2, ,199 Total Assets $ 9,488,959 $ 1,311,726 $ 36 $ 10,800,721 LIABILITIES AND FUND BALANCE Liabilities Accounts payable $ 55,149 $ - $ - $ 55,149 Due to other funds 2,007, ,007,332 Other accrued expenses 43, ,638 Unearned revenue 68, ,000 Total Liabilities 2,174, ,174,119 Fund Balance Nonspendable 2, ,199 Committed 1,824,870 1,311, ,136,632 Unassigned 5,487, ,487,771 Total Fund Balance 7,314,840 1,311, ,626,602 Total Liabilities and Fund Balance $ 9,488,959 $ 1,311,726 $ 36 $ 10,800,721 The accompanying notes are an integral part of these financial statements. 15

76 NORTHSTAR COMMUNITY SERVICES DISTRICT RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION JUNE 30, 2017 Total Fund Balance - Governmental Funds $ 8,626,602 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets: in governmental funds, only current assets are reported. In the statement of net position, all assets are reported, including capital assets and accumulated depreciation. Capital assets at cost 34,065,178 Accumulated depreciation (5,948,045) Long-term liabilities: In governmental funds, only current liabilities are reported. In the statement of net position, all liabilities, including long-term liabilities, are reported. Long-term liabilities relating to governmental activities consist of: Compensated absences (1,394,209) Retiree Termination Benefits (15,419) Other postemployment benefits (828,336) Lease revenue bonds payable (4,475,000) Net pension liability (5,049,758) Long-term liabilities already recognized in internal service funds 3,127,605 Deferred outflows and inflows of resources relating to pensions: In governmental funds, deferred outflows and inflows of resources relating to pensions are not reported because they are applicable to future periods. In the statement of net position, deferred outflows and inflows of resources relating to pension are reported. Deferred outflows of resources relating to pensions 3,924,006 Deferred inflows of resources relating to pensions (1,373,486) Net deferred outflows and inflows of resources already recognized in internal service funds (1,149,602) Total net position - Governmental Activities: $ 29,509,536 The accompanying notes are an integral part of these financial statements. 16

77 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS JUNE 30, 2017 General Fund Capital Projects Fund Building Fund Total REVENUE Taxes and assessments $ 5,168,557 $ - $ - $ 5,168,557 Fees and other non-tax revenue 424, ,929 Interest 38,322 7, ,566 Fire mitigation fees 36, ,132 Reimbursable revenue 384, ,433 Other 102, , ,446 Total revenue 6,154,582 7, ,412 6,427,063 EXPENDITURES General government 95, ,301 Public safety 4,622, ,622,197 Streets 237, ,886 Trails 319, ,271 Building expenses , ,255 Total expenditures 5,274, ,255 5,540,910 Excess (deficiency) of revenue over expenditures 879,927 7,069 (843) 886,153 OTHER FINANCING SOURCES (USES) Transfers out (38,143) - - (38,143) Net change in fund balances 841,784 7,069 (843) 848,010 FUND BALANCE, beginning of year 6,473,056 1,304, ,778,592 FUND BALANCE, end of year $ 7,314,840 $ 1,311,726 $ 36 $ 8,626,602 The accompanying notes are an integral part of these financial statements. 17

78 NORTHSTAR COMMUNITY SERVICES DISTRICT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2017 Net Change in Fund Balances - Governmental Funds $ 848,010 Amounts reported for governmental activities in the Statement of Activities are different because: Capital outlay: In governmental funds, the costs of capital assets are reported as expenditures in the period when the assets are acquired. In the statement of activities, costs of capital assets are allocated over their estimated useful lives as depreciation expense. The difference between capital outlay expenditures and depreciation expense for the period is: Expenditures for capital outlay 30,318 Depreciation expense (625,961) Debt service: In governmental funds, repayments of long-term debt are reported as expenditures. In the government-wide statements, repayments of long-term debt are reported as reductions of liabilities. Expenditures for repayment of the principal portion of long-term debt were: 95,000 Compensated absences: In governmental funds, compensated absences are measured by the amounts paid during the period. In the statement of activities, compensated absences are measured by the amounts earned. The difference between compensated absences paid and earned was: Retiree termination benefits: In governmental funds, retiree termination benefits are measured by the amounts paid during the period. In the statement of activities, retiree termination benefits are measured by the amounts earned. The difference between retiree termination benefits paid and earned was: 365,029 10,131 Pensions: In government funds, pension costs are recognized when employer contributions are made, in the statement of activites pension costs are recognized on the accrual basis. This year, the difference between accrualbasis pension costs and actual employer contributions was: 176,015 Postemployment benefits other than pensions (OPEB): In governmental funds, OPEB costs are recognized when employer contributions are made. In the statement of activities, OPEB costs are recognized on the accrual basis. The difference between OPEB costs paid and earned was: 135,217 Change in net position of governmental activities: $ 1,033,759 The accompanying notes are an integral part of these financial statements. 18

79 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF NET POSITION PROPRIETARY ENTERPRISE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 Northstar Martis Valley Solid ASSETS Water Water Sewer Waste Total Current assets: Cash and cash equivalents $ 4,434,471 $ 609,509 $ 4,648,768 $ 493,055 $ 10,185,803 Accounts receivable 263, , , ,312 Due from other governments ,781 23, ,336 Investments 2,191,599 5,868,361 2,593,369-10,653,329 Prepaid expenses 69,903-73, ,895 Total current assets 6,959,854 6,788,429 7,555, ,610 21,820,675 Noncurrent assets: Property, land and equipment 31,361,000 30,808,341 11,289, ,423 74,017,755 Less: accumulated depreciation (9,470,532) (5,679,480) (6,532,015) (43,237) (21,725,264) Total noncurrent assets 21,890,468 25,128,861 4,757, ,186 52,292,491 Total assets 28,850,322 31,917,290 12,313,758 1,031,796 74,113,166 LIABILITIES Current liabilities: Accounts payable 39,209 55,666 5, ,260 Accrued wages and related items 4,940 33, ,079 Unearned revenue - 3, ,000 Due to other funds 3,614,263 1,180,730 2,208, ,797 7,324,353 Total current liabilities 3,658,412 1,272,839 2,214, ,937 7,466,692 Total liabilities 3,658,412 1,272,839 2,214, ,937 7,466,692 NET POSITION Net investment in capital assets 21,890,468 25,128,861 4,757, ,186 52,292,491 Restricted for capital projects 2,303,022 4,307,809 2,603,415-9,214,246 Unrestricted 998,420 1,207,781 2,737, ,673 5,139,737 Total net position $ 25,191,910 $ 30,644,451 $ 10,099,254 $ 710,859 $ 66,646,474 The accompanying notes are an integral part of these financial statements. 19

80 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION PROPRIETARY ENTERPRISE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 Northstar Martis Valley Solid OPERATING REVENUE Water Water Sewer Waste Total Service charges $ 2,145,768 $ 1,389,538 $ 2,650,543 $ 471,799 $ 6,657,648 Grant revenue - 14, ,512 Other 34,487 58, ,135 Total operating revenue 2,180,255 1,462,698 2,650, ,799 6,765,295 OPERATING EXPENSES Wages 201, ,870 52,577 14, ,557 Employee benefits 8,871 4,108 20, ,476 Insurance - 10, ,780 Maintenance 56,581 58,669 26, ,842 Purchased services - - 1,050,227-1,050,227 Professional services 49,151 56, , ,342 Utilities 101, ,131 5, ,543 Other departmental expense 843, , , ,818 2,011,158 Communications 1,234 2,359 2,318-5,911 Dues and memberships Office and shop expense 10,647 13,176 2, ,503 Miscellaneous 52, ,263 13, ,527 Depreciation 641, , ,243 5,530 1,398,373 Total operating expenses 1,967,770 1,546,180 1,949, ,233 5,924,047 Operating income (loss) 212,485 (83,482) 700,679 11, ,248 NONOPERATING REVENUE (EXPENSE) Interest revenue 17,862 48,067 30,177-96,106 Income (loss) before capital contributions 230,347 (35,415) 730,856 11, ,354 CAPITAL CONTRIBUTIONS 652, , ,793-1,141,677 TRANSFERS (64,641) (38,886) (59,840) - (163,367) CHANGE IN NET POSITION 818,232 42,057 1,043,809 11,566 1,915,664 NET POSITION, beginning 24,373,678 30,602,394 9,055, ,293 64,730,810 NET POSITION, end of year $ 25,191,910 $ 30,644,451 $ 10,099,254 $ 710,859 $ 66,646,474 The accompanying notes are an integral part of these financial statements. 20

81 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF CASH FLOWS PROPRIETARY ENTERPRISE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 Nothstar Water Martis Valley Water Sewer Solid Waste Total CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers $ 2,138,132 $ 1,725,784 $ 2,617,393 $ 470,780 $ 6,952,089 Payments for services and supplies (1,110,425) (936,931) (1,639,665) (440,168) (4,127,189) Payments of employee salaries (203,512) (126,422) (54,728) (14,310) (398,972) Payments of employee benefits (8,871) (4,108) (20,026) (471) (33,476) Interfund reimbursements 804, , , ,476 1,952,333 Net cash provided (used) by operating activities 1,619,943 1,224,061 1,367, ,307 4,344,785 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition and construction of capital assets (714,503) (1,810,372) (423,146) - (2,948,021) Transfers (64,641) (38,886) (59,840) - (163,367) Net cash provided (used) by capital and related financing activities (779,144) (1,849,258) (482,986) - (3,111,388) CASH FLOWS FROM INVESTING ACTIVITIES Sale (purchase) of investments (734,925) (1,245,580) (638,509) - (2,619,014) Interest received 92, , , ,355 Capital contributions 652,526 99, ,604-1,135,120 Net cash provided (used) by investing activities 10,264 (963,274) (141,529) - (1,094,539) NET INCREASE (DECREASE) IN CASH 851,063 (1,588,471) 742, , ,858 CASH AND CASH EQUIVALENTS, beginning of year 3,583,408 2,197,980 3,905, ,748 10,046,945 CASH AND CASH EQUIVALENTS, end of year $ 4,434,471 $ 609,509 $ 4,648,768 $ 493,055 $ 10,185,803 RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating income (loss) $ 212,485 $ (67,114) $ 690,868 $ 11,566 $ 847,805 Adjustment to reconcile operating income (loss) to net cash provided (used) by operating activities: Depreciation 641, , ,243 5,530 1,398,373 (Increase) decrease in: Accounts receivable (42,123) 255,957 (27,645) ,243 Due from other governments - - (5,505) (1,073) (6,578) Prepaid expenses 4,013-4,013-8,026 Increase (decrease) in: Accounts payable 713 (48,542) (2,849) (81) (50,759) Accrued wages (1,547) 22,448 (2,151) (165) 18,585 Deferred revenue - (9,239) - - (9,239) Compensated absences 804, , , ,476 1,952,329 Net cash provided (used) by operating activities $ 1,619,943 $ 1,224,061 $ 1,367,474 $ 133,307 $ 4,344,785 The accompanying notes are an integral part of these financial statements. 21

82 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF NET POSITION INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 ASSETS Current assets: Cash and cash equivalents $ (7,773,590) Accounts receivable 15,319 Due from other funds 9,331,685 Inventory 8,560 Prepaid expenses 557,656 Total current assets 2,139,630 Total assets 2,139,630 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows on pensions 1,768,676 LIABILITIES Current liabilities: Accounts payable 136,239 Accrued wages and related items 25,388 Total current liabilities 161,627 Noncurrent liabilities: Compensated absences 549,979 Retiree termination benefits 15,419 Other postemployment benefits liabilities 286,118 Net pension liabilties 2,276,089 Total noncurrent liabilities 3,127,605 Total liabilities 3,289,232 DEFERRED INFLOWS OF RESOURCES Deferred inflows on pensions 619,074 NET POSITION Unrestricted $ - The accompanying notes are an integral part of these financial statements. 22

83 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 OPERATING REVENUE Charges for services $ 3,053,963 Other 28,503 Total operating revenue 3,082,466 OPERATING EXPENSES Engineering & Utility Operations 1,124,742 Fleet operations & maintenance 97,427 Administrative Operations 2,061,807 Total operating expenses 3,283,976 Income (loss) before transfers (201,510) TRANSFERS 201,510 CHANGE IN NET POSITION - NET POSITION, beginning - NET POSITION, end of year $ - The accompanying notes are an integral part of these financial statements. 23

84 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2017 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from internal charges $ 3,483,751 Cash received from other sources 28,503 Payments for employee salaries & benefits (1,456,920) Payments for services and supplies (2,528,878) Net cash provided (used) by operating activities (473,544) CASH FLOWS FROM NONCAPITAL ACTIVITIES FINANCING ACTIVITIES Interfund transfers (2,789,856) Net cash provided (used) by capital and related financing activities (2,789,856) NET INCREASE (DECREASE) IN CASH (3,263,400) CASH AND CASH EQUIVALENTS, beginning of year (4,510,190) CASH AND CASH EQUIVALENTS, end of year $ (7,773,590) RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES Operating income (loss) $ (201,510) Adjustment to reconcile operating income (loss) to net cash provided (used) by operating activities: (Increase) decrease in: Accounts receivable 429,788 Prepaid expenses (470,319) Inventory 1,884 Deferred outflows (787,812) Increase (decrease) in: Accounts payble (343,437) Accrued wages and related items (22,689) Compensated absences 51,387 Other postemployment benefits liabilities 39,534 Net pension liability 495,208 Deferred inflows 334,422 Net cash provided by operating activities $ (473,544) The accompanying notes are an integral part of these financial statements. 24

85 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF NET POSITION FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2017 ASSETS 2014 Special Series 2005 Series 2006 Refunding Bonds Bonds Bonds Total Cash and cash equivalents $ 9,947,022 $ 5,306,230 $ 54,433 $ 15,307,685 LIABILITIES Due to others $ 9,947,022 $ 5,306,230 $ 54,433 $ 15,307,685 The accompanying notes are an integral part of these financial statements. 25

86 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. ORGANIZATION Northstar Community Services District (the District ) was founded on November 20, 1990, and is an unincorporated political subdivision of the State of California. The District's operations are governed by an elected board of directors consisting of five members. The District provides fire protection services, fuels management services, water, sewer and solid waste services, snow removal and roads maintenance services to the citizens residing within District boundaries. In addition, the District is responsible for maintaining a multi-use recreational trail network. The financial statements of the District are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The District's reporting entity applies all relevant Governmental Accounting Standards Board (GASB) pronouncements. Reporting Entity The Board of Directors is the level of government which has governance responsibilities over all activities related to operations of the District. The Board is not included in any other governmental "reporting entity" as defined by the Governmental Accounting Standards Board, since Board members have decision-making authority, the power to designate management, the responsibility to significantly influence operations and primary accountability for fiscal matters. The District s Board of Directors formed a non-profit public benefit corporation known as the Northstar Community Services District Financing Authority (Financing Authority). The District and the Financing Authority have a financial and operational relationship which meets the reporting entity definition criteria of Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, for inclusion of the Financing Authority as a blended component unit of the District. Therefore, the financial activities of Financing Authority have been included in the financial statements of the District. The following are those aspects of the relationship between the District and Financing Authority which satisfy Codification of Governmental Accounting and Financial Reporting Standards, Section 2100: Manifestations of Oversight The Financing Authority's Board of Directors is the District's Board of Directors. The Financing Authority has no employees. The District's general manager functions as an agent of the Financing Authority. The individuals did not receive additional compensation for work performed in this capacity. The District exercises significant influence over operations of the Financing Authority as it is anticipated that the District will be the sole lessee of all facilities owned by the Financing Authority. 26

87 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Accounting for Fiscal Matters All major financing arrangements, contracts, and other transactions of the Financing Authority must have the consent of the District. Any deficits incurred by the Financing Authority will be reflected in the lease payments of the District. Any surpluses of the Financing Authority revert to the District at the end of the lease period. It is anticipated that the District's lease payments will be the sole revenue source of the Financing Authority. Scope of Public Service and Financial Presentation The Financing Authority was created for the sole purpose of financially assisting the District. The Financing Authority is a nonprofit, public benefit corporation incorporated under the laws of the State of California and recorded by the Secretary of State. The Financing Authority was formed to provide financing assistance to the District for construction and acquisition of a new administrative building. Upon completion, the District intends to occupy all Financing Authority facilities. When the Financing Authority's Lease Revenue Bonds have been paid, title to all Financing Authority property will pass to the District for no additional consideration. The Financing Authority s financial activity is presented in the financial statements in the Building Fund. Lease Revenue Bonds issued by the Financing Authority are included in the longterm liabilities. B. BASIS OF PRESENTATION Government-wide Financial Statements The statement of net position and the statement of activities display financial information about the District. These statements include the financial activities of the overall government. Eliminations have been made to minimize the double counting of internal activities. The government-wide statement of net position presents information on all of the District s assets and liabilities, with the difference between the two presented as net position. Net position is reported as three categories as applicable: net investment in capital assets, restricted and unrestricted. Restricted net position is further classified as either net position restricted by enabling legislation or net position that is otherwise restricted. 27

88 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 B. BASIS OF PRESENTATION (CONTINUED) The government-wide statement of activities presents a comparison between direct expenses and program revenues for each function or program of the District s governmental activities. Direct expenses are those that are specifically associated with a service, program or department and are, therefore, clearly identifiable to a particular function. The District does not allocate indirect expenses to functions in the statement of activities. Program revenues include charges paid by the recipients of goods or services offered by a program, as well as grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues, which are not classified as program revenues, are presented as general revenues of the District, with certain exceptions. The comparison of direct expenses with program revenues identifies the extent to which each governmental function is self-financing or draws from the general revenues of the District. The District reports all direct expenses by function in the Statement of Activities. Direct expenses are those that are clearly identifiable with a function. Depreciation expense is not allocated by function. Interest on long-term liabilities is considered an indirect expense and is reported separately in the Statement of Activities. Fund Financial Statements Fund financial statements report detailed information about the District. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major governmental fund is presented in a separate column. C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING Government-Wide Financial Statements The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements are met. Expenses are recorded when liabilities are incurred. Governmental Fund Financial Statements Governmental fund financial statements (i.e. balance sheet and statement of revenues, expenditures and changes in fund balances) are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded under the accrual basis when the exchange takes place. On a modified accrual basis, revenue is recorded in the fiscal year in which the resources are measurable and become available. Available means the resources will be collected within the current fiscal year or are expected to be collected soon enough thereafter to be used to pay liabilities of the current fiscal year. For the District, available means collectible within the current period or within 60 days after year-end. 28

89 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING (CONTINUED) Non-exchange transactions, in which the District receives value without directly giving equal value in return, include property taxes, grants, and entitlements. Under the accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants and entitlements is recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are to be used, or the fiscal year when use is first permitted; matching requirements, in which the District must provide local resources to be used for a specified purpose; and expenditure requirements, in which the resources are provided to the District on a reimbursement basis. Under the modified accrual basis, revenue from non-exchange transactions must also be available before it can be recognized. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. D. FUND ACCOUNTING The accounts of the District are organized on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures or expenses, as appropriate. District resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The District funds are as follows: Governmental Funds: General Fund is the general operating fund of the District. It is used to account for all transactions except those required or permitted by law to be accounted for in another fund. Capital Projects Fund is used to account for the acquisition and construction of major capital facilities funded by special taxes levied by the Community Facilities District (CFD) for the benefit of CFD properties. Building Fund is used to account for the construction of the new administration building. Proprietary Enterprise Funds: Northstar Water Fund is used to account for the delivery of Northstar water services. Martis Valley Water Fund is used to account for the delivery of Martis Valley water services. Sewer Fund is used to account for the delivery of sewer services. Solid Waste Fund is used to account for the delivery of solid waste services. 29

90 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Internal Service Funds The Northstar Community Services District employs the use of several Internal Service Funds. The District is the primary recipient of the goods and services provided by the Internal Service Funds and those funds recover their full cost of providing services, including the cost of capital assets (depreciation, related debt service, or estimated replacement cost) by charging the other District funds in which they support. The three Internal Service Funds utilized by the District are shown below: Fund 010 Engineering & Utility Operations. This fund consists of the activities of the engineering and utility operations staff required in support of overall District operations. Fund Fleet Operations & Maintenance. This fund consists of the fiscal activities required to purchase, maintain, and repair the vehicle and small equipment fleet that belong to the District, with the exception of vehicles and equipment specifically dedicated to Fire, Snow (blowers, sweeper, and grader), and PRD/CSA (Kodiak). Fund 050 Administrative Operations. This department includes the operational areas of General Management, Human Resources, Information Technology (IT)/Geographic Information System (GIS), Accounting functions, and the Board of Directors. Fiduciary Funds: The Agency Funds are used to account for assets held by the District as an agent for the bondholders. The financial activities of these funds are excluded from the government-wide financial statements, but are presented in separate fiduciary fund financial statements. E. CASH AND CASH EQUIVALENTS For purposes of the statement of net position/balance sheet, the District considers all short-term highly liquid investments, including restricted assets, and amounts held with the fiscal agent to be cash and cash equivalents. Amounts held with the fiscal agent are available on demand to the District. F. PREPAID EXPENSES The District entered into a barter truncation with Northstar Community Housing Corporation during the fiscal year ended June 30, 2007 in which water and sewer connection and user fees were exchanged for employee housing services. Employee housing services will end once the credit has been exhausted or in thirty years, whichever comes first. Any credit not used by the end of the 30 year period will be paid to the District G. INVENTORY Inventory consist of fuel kept on hand and is stated at average cost per gallon. This fuel is for equipment used by the District. 30

91 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 H. INVESTMENTS The District records its investments at fair market value. Changes in fair market value are reported as revenue in the Statement of Revenues, Expenses, and Changes in Net Position. The effect of recording investments at fair market value is reflected as a net increase in the fair value of investments on the Statement of Revenues, Expenses, and Changes in Net Position and on the Statement of Net Position. Fair market values of investments have been determined based on quoted market prices. I. ACCOUNTS RECEIVABLE All receivables are reported at their gross value, and where appropriate, are reduced by the estimated portion that is expected to be uncollectible. As of June 30, 2017, the total accounts receivable portfolio was considered collectible. Interest on investments is recorded in the year the interest is earned. J. CAPITAL ASSETS Capital assets purchased or acquired with an original cost of $5,000 or more are reported at historical cost. Depreciation is recorded on all depreciable capital assets on a straight-line basis over the following estimated useful lives: Buildings and Improvements Years Water and Sewer System Years Vehicles and Equipment 5 25 Years Software 7 Years K. UNEARNED REVENUE Unearned revenue includes a payment received for future use of trails management. The balance decreases as this amount is used. L. DUE FROM OTHER GOVERNMENTS The District s receivables include amounts due from other governmental agencies and consist mostly of tax revenues and user fees. Management has determined that the District s receivables are fully collectible. Accordingly, no allowance for doubtful accounts has been made. M. COMPENSATED ABSENCES District employees are entitled to certain compensated absences based on the length of their employment, which will be paid to them upon separation from the District. Compensated absences accumulate and are accrued when they are earned and reported as a liability in the governmentwide financial statements. 31

92 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 I. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES In addition to assets, the statement of net position includes a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s), and as such will not be recognized as an outflow of resources (expense/expenditures) until then. In addition to liabilities, the statement of net position includes a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and as such, will not be recognized as an inflow of resources (revenue) until that time. J. FUND BALANCE In accordance with Governmental Accounting Standards Board (GASB) Statement No. 54, "Fund Balance Reporting and Governmental Fund Type Definitions, the District is required to report fund balances in the following categories: Nonspendable, Restricted, Committed, Assigned and/or Unassigned. Nonspendable Fund Balance reflects assets not in spendable form, either because they will never convert to cash (prepaid expense) or must remain intact pursuant to legal or contractual requirements. Restricted Fund Balance reflects amounts that can be spent only for the specific purposes stipulated by constitution, external resource providers, or through enabling legislation. Committed Fund Balance reflects amounts that can be used only for the specific purposes determined by a formal action of the government's highest level of decision-making authority: the Board of Directors. Commitments may be established, modified, or rescinded only through resolutions approved by the Board of Directors. Assigned Fund Balance reflects amounts intended to be used by the government for specific purposes but do not meet the criteria to be classified as restricted or committed. Under the District s adopted policy, only the Board of Directors is authorized to assign amounts for specific purposes. Unassigned Fund Balance represents the residual classification for the government's general fund and includes all spendable amounts not contained in the other classifications. When expenditures are incurred for purposes of which restricted, committed, assigned and unassigned fund balances are available, the District considers restricted funds to have been spent first, followed by committed, assigned and unassigned, respectively. 32

93 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 K. USE OF ESTIMATES The financial statements have been prepared in conformity with generally accepted accounting principles and, as such, include amounts based on managements informed estimates and judgments, with consideration given to materiality. Actual results could differ from those amounts. L. PROPERTY TAX The District receives property taxes to support its operations. Secured property taxes are levied as an enforceable lien on property as of March 1. Taxes are payable in two installments, on December 10 and April 10. Unsecured property taxes are payable in one installment on or before August 31. The County of Placer bills and collects the taxes for the District. Tax revenues are recognized by the District when received. 2. CASH AND INVESTMENTS A. CASH AND EQUIVALENTS The District s cash balances at June 30, 2017 are: Governmental Business-Type Fiduciary Funds Activities Activities Total Deposits: US Bank $ (2,141,466) $ 8,123,680 $ - $ 5,982,214 Charles Schwab Money Market 20,221 10,175-30,396 Cash on Hand: Petty Cash Cash with Fiscal Agent: Wells Fargo Mello Roos Funds 1,311,762-15,307,685 16,619,447 Pooled Funds: Local Agency Investment Fund 1,756,953 2,051,948-3,808,901 Total Cash and Equivalents $ 947,870 $ 10,185,803 $ 15,307,685 $ 26,441,358 Pooled Funds: The District is a voluntary participant in the Local Agency Investment Fund (LAIF), which is regulated by California Government Code Section under the oversight of the Treasurer of the state of California and the Pooled Money Investment Board. The State Treasurer s Office pools these funds with those of other governmental agencies in the state and invests the cash. The fair value of the District s investment in this pool, which approximates cost, is reported in the accompanying financial statements based upon the District s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. Funds are accessible and transferable to the master account with twenty-four hours notice. The Pooled Money Investment Board has established policies, goals, and objectives to make certain that their goal of safety, liquidity, and yield are not jeopardized. 33

94 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Included in LAIF s investment portfolio are collateralized mortgage obligations, mortgage-backed securities, other asset backed securities, and floating rate securities issued by Federal Agencies, government-sponsored enterprises and corporations. The monies held in the LAIF are not subject to categorization by risk category. It is also not rated as to credit risk by a nationally recognized statistical rating organization. LAIF is administered by the State Treasurer and audited annually by the Pooled Money Investment Board and the State Controller s Office. Copies of this audit may be obtained from the State Treasurer s Office: 915 Capitol Mall, Sacramento, California Deposits - Custodial Credit Risk The carrying amount of the District's accounts was $5,982,214 and the bank balances were $6,088,580 at June 30, Deposits held in banks are insured up to $250,000 by the Federal Depository Insurance Corporation. Should deposits exceed the insured limits, the balance is covered by collateral held by the bank in accordance with California law requiring the depository bank to hold collateral equal to 110% of the excess government funds on deposit. This collateral must be in the form of governmentbacked securities. All cash held by financial institutions at June 30, 2017 was fully insured or collateralized. Cash with Fiscal Agent At June 30, 2017, funds totaling $16,619,447 were held at Wells Fargo Bank in various accounts related to the Special Tax Bonds issued in 2005 and 2006, the Refunding Bonds issued in 2014 for the construction of facilities and payment of the Special Tax Bonds and the Lease Revenue Bonds issued in 2015 for the purpose of funding the construction of a new administration building. 34

95 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 B. INVESTMENTS Authorized Deposits/Investments Under provisions of the District s investment policy, and in accordance with Section of the California Government Code, The District may invest in the following types of investments: Investment Maximum % of Limit Per Maximum Authorized Investment Type US Treasury bills, notes and bonds Rating (S&P) AAA Portfolio 70 Issuer None Maturity 5 Years Government Agencies Securities AAA 70 50% 5 Years Local Agency Investment Fund (LAIF) N/A 50 None 3 Years Bonds, notes or other indebtedness of the State of California AA 10 None 5 Years Bankers Acceptances N/A 20 10% 180 days Commercial Paper A % 270 days Time Deposits Top 25% of peer group 20 $500,000 2 Years Repurchase Agreements N/A 20 10% N/A Corporate Obligations A 30 10% 5 Years Mutual Funds AAA 15 10% 3 Years Other Government Sponsored Pools AAAf 20 10% 3 Years Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The mutual funds are considered short term. As of June 30, 2017, The District had the following investments: Investment Maturities Investment Type Fair Value <1 yrs 1-3 yrs >3yrs Corporate Notes $ 11,853,405 $ 2,191,406 $ 7,035,078 $ 2,626,921 Municipal Bonds 57,867-35,980 21,887 Bond Funds 302, , $ 12,214,237 $ 2,494,371 $ 7,071,058 $ 2,648,808 35

96 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Credit Risk The District s investment philosophy sets the tone for its policies, practices, procedures and objectives that control the investment function. The investment of funds will be guided by the primary goals of safety, liquidity, diversification, and reasonable market rate of return. The investment function will have additional goals of: assuring ongoing compliance with Federal, State, and local laws governing the investment of funds kept by the District, maintaining reserves for long term projects and contingencies, and establishing quality standards and limits to the type of investments made and with which institutions investments are placed. Goals will be carried out in the context of the Prudent Investment Rule which states that investments shall be made with judgment and care under circumstances then prevailing which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. Credit Rating Municipal Corporate Bond (S&P) Bonds Notes Funds Totals NR $ - $ 98,445 $ 302,965 $ 401,410 AA- 57, ,866 AA - 82,500-82,500 A , ,245 A - 922, ,978 A- - 1,188,205-1,188,205 BB , ,496 BBB+ - 3,921,264-3,921,264 BBB - 3,839,360-3,839,360 BBB- - 1,364,912-1,364,912 Totals $ 57,866 $ 11,853,405 $ 302,965 $ 12,214,237 Concentration of Credit Risk The District places limits on the amount it may invest in anyone issuer. At June 30, 2017, the District had no concentration of credit risk. There were no investments in securities of any one issuer consisting of 5% or more of total investments. 36

97 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Investment Fund Valuation Investments, including derivative instruments that are not hedging derivatives, are measured at fair value on a recurring basis. Recurring fair value measurements are those that Governmental Accounting Standards Board (GASB) Statements require or permit in the statement of net position at the end of each reporting period. Fair value measurements are categorized based on the valuation inputs used to measure an asset s fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. Investments fair value measurements are as follows at June 30, 2017: Description Level 1 Level 2 Level 3 Total US Agency, Treasury & Municipal Notes (USATM): Municipal Notes: $ 57,867 $ - $ - $ 57,867 Corporate Bonds - 302, ,965 Corporate Notes - 11,853,405-11,853,405 Total $ 57,867 $ 12,156,370 $ - $ 12,214, PROPERTY AND EQUIPMENT Capital assets activity for the year ended June 30, 2017, was as follows: Governmental Activities: Balance Balance June 30, 2016 Additions Deletions June 30, 2017 Not subject to depreciation Land $ 7,598,216 $ - $ - $ 7,598,216 Construction In Progress Capital Project Fund 117, ,341 Total Not subject to Depreciation 7,715, ,715,557 Subject to Depreciation Buildings and Improvements 21,196, ,196,235 Equipment 1,426,465 30,318 12,012 1,444,771 Vehicles and Equipment 3,630, ,630,028 Software 78, ,587 Total depreciable 26,331,315 30,318 12,012 26,349,621 Less accumulated depreciation (5,334,096) (625,961) (12,012) (5,948,045) Total capital assets, net $ 28,712,776 $ (595,643) $ - $ 28,117,133 37

98 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Business-Type Activities: Balance Balance June 30, 2016 Adjustments* Additions Deletions June 30, 2017 Not subject to depreciation Land $ 748,907 $ - $ - $ - $ 748,907 Construction In Progress 458,940-1,832, ,347 2,151,498 Total Not subject to Depreciation 1,207,847-1,832, ,347 2,900,405 Subject to Depreciation Buildings and Improvements 20,337, ,336,985 Equipment 1,111, ,909-1,311,923 Vehicles and Equipment 707,941-13, ,083 Software 111, , ,370 Water /Sewer System 42,766,956 4,827, ,940-48,488,989 Total depreciable 65,034,794 4,827,093 1,255, ,117,350 Less accumulated depreciation (15,499,798) (4,827,093) (1,398,373) - (21,725,264) Total capital assets, net $ 50,742,843 $ - $ 1,690,291 $ 140,643 $ 52,292,491 *Gross up costs and accumulated depreciation for assets acquired from Martis Valley Water System in prior year. 4. INTERFUND TRANSACTIONS As of June 30, 2017, the interfund receivable and payable balances were as follows: Interfund Interfund Receivables Payables General Fund $ - $ 2,007,332 Northstar Water Fund - 3,614,263 Martis Valley Water Fund - 1,180,730 Sewer Fund - 2,208,563 Solid Waste Fund - 320,797 Internal Service Fund 9,331,685 - Total $ 9,331,685 $ 9,331,685 Interfund Transfers Interfund transfers consist of operating transfers from funds receiving resources to funds through which the resources are to be expended. All transfers were to the Internal Service Fund to cover expenses. Transfers Transfers In Out General Fund $ - $ 38,143 Northstar Water Fund - 64,641 Martis Valley Water Fund 38,886 Sewer Fund - 59,840 Internal Service Fund 201,510 - Total $ 201,510 $ 201,510 38

99 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, EMPLOYEE RETIREMENT PLAN A. PLAN DESCRIPTION Northstar Community Services District participates in the California Public Employees' Retirement System (CalPERS), a cost-sharing multiple-employer public employee retirement system defined benefit pension plan administered by CalPERS. The plan provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. Benefit provisions are established by state statutes, as legislatively amended, within the Public Employees' Retirement Law. CalPERS issues a separate comprehensive annual financial report that includes financial statements and required supplementary information. Copies of the CalPERS annual financial report may be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, California The Plan s provisions and benefits in effect at June 30, 2017, are summarized as follows: Hire date Prior to January 1, 2013 On or after January 1, 2013 Benefit formula Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life Retirement age Monthly benefits, as a % of eligible compensation 1.4% to % 1.0% to 2.5% Required employee contribution rates 7.000% 6.250% Required employer contribution rates 8.880% 6.555% Safety Prior to On or after Hire Date January 1, 2013 January 1, 2013 Benefit formula Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life Retirement age Monthly benefits, as a % of eligible compensation 3% 3% Required employee contribution rates 9% 9% Required employer contribution rates % % 39

100 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Deferred Outflows/Inflows of Resources Section 20814(c) of the California Public Employees Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for the Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Northstar Community Services District is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. For the year ended June 30, 2017, the contributions recognized as part of pension expense for the Plan were: Miscellaneous Safety Contributions -employer $ 539,707 $ 598,928 Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2017, Northstar Community Services District reported net pension liabilities for its proportionate share of the net pension liability of the Plans of: Proportionate Share of Net Pension Liability Miscellaneous $ 2,247,126 Safety 2,802,632 Total Net Pension Liability $ 5,049,758 Northstar Community Services District s net pension liability for the Plan is measured as the proportionate share of the net pension liability. The net pension liability of the Plan is measured as of June 30, 2016, and the total pension liability for the Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2015 rolled forward to June 30, 2016 using standard update procedures. Northstar Community Services District s proportion of the net pension liability was based on a projection of the District s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. The District s proportionate share of the net pension liability for the Plan as of June 30, 2015 and 2016 was as follows: Miscellaneous Safety Proportion - June 30, % % Proportion - June 30, % % Change - Increase (Decrease) % % 40

101 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2017, the District recognized pension expense of ($343,855) and ($550,936) for Miscellaneous and Safety, respectively. At June 30, 2017, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Miscllaneous Saftey Total Deferred Outflows Deferred Inflows Deferred Outflows Deferred Inflows Deferred Outflows Deferred Inflows of Resources of Resources of Resources of Resources of Resources of Resources Pension contributions subsequent to measurement date $ 539,707 $ - $ 539,707 $ - $ 1,079,414 $ - Difference between projected and actual experience 11,597 2,657-33,929 11,597 36,586 Difference in actual vs. projected contributions 176, , ,645 - Change in proportion 254, , , ,034 Changes in assumptions - 109, , ,653 Net differences between projected and actual earnings on plan investments 919, ,693 1,186, ,520 2,106, ,213 Total $ 1,901,820 $ 461,071 $ 2,022,186 $ 912,415 $ 3,924,006 $ 1,373,486 The amounts reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, Other amounts reported as deferred inflows of resources related to pensions will be recognized as pension expense as follows: Measurement Period Ended June 30 Miscellaneous Safety Total 2017 $ 241,812 $ (77,610) $ 164, $ 213,577 $ 201,282 $ 414, $ 177,952 $ 146,053 $ 324, $ 139,944 $ 147,953 $ 287, $ 127,757 $ 152,385 $ 280,142 41

102 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Actuarial Assumptions The total pension liabilities in the June 30, 2016 actuarial valuations were determined using the following actuarial assumptions for both plans: Valuation Date June 30, 2015 Measurement Date June 30, 2016 Entry-Age Normal in accordance with the requirement Actuarial Cost Method of GASB 68 Actuarial Assumptions Discount Rate 7.65% Inflation 2.75% Salary Increases Varies by Entry Age and Service Investment Rate of Return 7.65% Net of Pension Plan Investment Expenses, include inflation Mortality (1) Derived using CalERS' Membership Data for all Funds (1) The mortality rate table used was developed based on CalPERS" specific data. The table include 20 years of mortality imnprovements using Society of Actuaries Scale BB. For more details on this table, please refer to the 2014 experience study report Discount Rate The discount rate used to measure the total pension liability was 7.65 percent. To determine whether the municipal bond rate should be used in the calculation of the discount rate for public agency plans (including PERF C), the amortization and smoothing periods recently adopted by the Board were used. For the Plan, the crossover test was performed for a miscellaneous agent rate plan and a safety agent rate plan selected as being more at risk of failing the crossover test and resulting in a discount rate that would be different from the long-term expected rate of return on pension investments. Based on the testing of the rate plans, the tests revealed the assets would not run out. Therefore the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to dete1mine the total pension liability for PERF C. The crossover test results are presented in a detailed report called "GASB Crossover Testing Report" that can be obtained on CalPERS' website under the GASB 68 section. The long-term expected rate of return on pension plan investments was determined using a buildingblock method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. 42

103 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 In determining the long-term expected rate of return, staff took into account both short-term and longterm market return expectations as well as the expected pension fund (Public Employees' Retirement Fund) cash flows. Using historical returns of all the funds' asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected nominal returns for both short-term and longterm, the present value of benefits was calculated. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent. The long-term expected real rates of return by asset class can be found in CalPERS ' Comprehensive Annual Financial Report for the fiscal year ended June 30, The table below reflects the long-term expected real rate of return by asset class. The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These rates of return are net of administrative expenses. Asset Class New Strategic Allocation Real Return Years 1-10(a) Real Return Years 11+(b) Global Equity 47.0% 5.25% 5.71% Global Fixed Income 20.0% 0.99% 2.43% Inflation Sensitive 6.0% 0.45% 3.36% Private Equity 12.0% 6.83% 6.95% Real Estate 11.0% 4.50% 5.13% Infrastructure and Forestland 3.0% 4.50% 5.09% Liquidity 1.0% (0.55%) (1.05%) (a) An expected inflation of 2.5% used for this period (b) An expected inflation of 3.0% used for this period Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the Authority s proportionate share of the net pension liability for each Plan, calculated using the discount rate for each Plan, as well as what the Authority s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate: Discount Rate - 1% Current Discount Discount Rate + 1% (6.65%) Rate (7.65%) (8.65%) Safety $ 4,419,680 $ 2,802,632 $ 1,595,440 Miscellaneous $ 3,312,628 $ 2,247,126 $ 1,366,542 43

104 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 Pension Plan Fiduciary Net Position Detailed information about each pension plan s fiduciary net position is available in the separately issued CalPERS Miscellaneous and Safety financial reports. Payable to the Pension Plan As of June 30, 2017, the District had no outstanding required contributions to the pension plans. 7. GENERAL LONG-TERM DEBT Lease Revenue Bonds In 2015, the District issued Lease Revenue Bonds in the amount of $4,655,000 for the purpose of funding the construction of a new administration building. The current interest and yield vary, ranging from 2.0% to 4.0%. The bonds are scheduled to mature through August The District s outstanding lease revenue bonded debt as of June 30, 2017 is as follows: Date Amount of Redeemed Of Maturity Original Outstanding Current Outstanding Issue Interest Rates Date Issue July 1, 2016 Issued Year June 30, 2017 June % - 4.0% 6/1/2045 $ 4,655,000 $ 4,570,000 $ - $ 95,000 $ 4,475,000 The annual requirements to amortize the current interest bonds payable, outstanding as of June 30, 2017, are as follows: Year Ended June 30 Principal Interest Total 2018 $ 95,000 $ 168,350 $ 263, , , , , , , , , , , , , , ,500 1,324, , ,875 1,333, , ,800 1,322, ,050, ,200 1,326, ,000 59, ,600 $ 4,475,000 $ 2,950,975 $ 7,425,975 44

105 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 A schedule of changes in long-term liabilities for the year ended June 30, 2017 is shown below: Governmental Activities Due Balance Balance Within July 1, 2016 Additions Deductions June 30, 2017 One Year Other Postemployment benefits $ 677,435 $ 184,853 $ 33,952 $ 828,336 $ - Retiree Termination Benefits 10,131 5,288-15,419 15,419 Net Pension Liability 4,062, ,957-5,049,758 - Compensated Absences 1,209, ,950-1,394,209 - Lease Revenue Bonds 4,570,000-95,000 4,475,000 95,000 $ 10,529,626 $ 1,362,048 $ 128,952 $ 11,762,722 $ 110, DEBT WITHOUT GOVERNMENT COMMITMENT During 2005 and 2006, bonded debt was issued by a special assessment district known as Community Facilities District #1 (CFD) to finance infrastructure improvements and facilities within the District s boundaries. The District has no legal responsibility with respect to the payment of the debt and the proceeds will be used for various projects in the County of Placer and Northstar Community Services District. Therefore, the District has not recorded it as a liability. The debt is to be repaid from a special tax levied on properties within the CFD. The District is responsible for a portion of the construction and improvements financed by the special assessment district. Therefore, the related capital projects fund is reflected in the District s financial statements. The District also acts as the CFD s agent with respect to the receipts, disbursements and balances. These amounts are reported as agency fund transactions. The following includes information related to the outstanding debt as of June 30, In December 2005, the Northstar Community Services District Community Facilities District No. 1 issued Special Tax Bonds, Series 2005 in the amount of $56,125,000, with interest rates ranging from 3.80% to 5.55%. In December 2006, the Northstar Community Services District Community Facilities District No. 1 issued Special Tax Bonds, Series 2006 in the amount of $58,590,000, with interest rates ranging from 3.90% to 5.00%. In July 2014, the District issued Special Tax Refunding bonds to refund a portion of CFD No. 1 Special Tax Bonds, Series 2005 and Series 2006, fund a deposit to the parity reserve fund for the Bonds and pay the costs of issuance. Interest on the bonds is payable every September 1 and March 1 beginning on September 1, Principal on the bonds will be payable on September 1 beginning on September 1, The bonds will currently refund $21,140,000 of the 2005 and 2006 Special Tax Bonds. The bonds created a deferred loss on refunding in the amount of $1,820,000. The bonds carry interest rates of 4.00% and 5.00% and will fully mature on September 1,

106 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 At June 30, 2017, the outstanding bonds consisted of the following: Date Maturity Amount of Redeemed Of Date Original Outstanding Current Outstanding Description Issue Interest Rates Sept 1, Issue July 1, 2016 Issued Year June 30, 2017 Series % % 2036 $ 56,125,000 $ 48,305,000 $ - $ - $ 48,305,000 Series % % ,590,000 42,415, ,415,000 Refunding Bonds % % ,320,000 18,945,000-1,450,000 17,495,000 $ 134,035,000 $ 109,665,000 $ - $ 1,450,000 $ 108,215,000 The annual requirements to pay the bonds outstanding as of June 30, 2017 are as follows: Year Ended June 30 Principal Interest Total 2018 $ 1,650,000 $ 839,650 $ 2,489, ,860, ,650 2,633, ,085, ,250 2,784, ,340, ,000 2,935, ,620,000 3,142,723 5,762, ,905,000 13,330,830 31,235, ,950,000 18,244,343 46,194, ,500,000 9,501,443 51,001, ,305, ,250 10,820,250 $ 108,215,000 $ 47,642,138 $ 155,857,138 46

107 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, OTHER POSTEMPLOYMENT BENEFITS A. PLAN DESCRIPTION Northstar Community Services District participates in the California Public Employees' Retirement System (CalPERS), an agent multiple-employer defined benefit healthcare plan as permitted under the Public Employees Medical and Hospital and Care Act (PEMHCA). The District is required to contribute minimum employer contributions incurred by the CalPERS medical program for the retiree s lifetime or until coverage is discontinued. In fiscal year 2016/17, minimum employer contributions were $125 through December 31, 2016 and $128 through June 30, 2017 per month per retiree. B. FUNDING POLICY The District s Board of Directors is only funding the plan on a pay-as-you-go basis. The Board will review the funding requirements and policy annually. C. ANNUAL OPEB COST AND NET OPEB OBLIGATION The District s annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required contribution of the employer (ARC). The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and to amortize any unfunded actuarial liabilities (or funding excess) over an amortization period of 30 years. The following table shows the components of the District s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in its net OPEB obligation to the Retiree Health Plan: Admin Fire Operations Fuels Total Annual required Contribution $ 23,738 $ 129,654 $ 33,239 $ 5,121 $ 191,752 Interest on net OPEB obligation 3,507 16,545 6, ,098 Adjustment to annual required contribution (4,400) (20,757) (7,975) (865) (33,997) Annual OPEB cost (expense) 22, ,442 31,621 4, ,853 Implicit contributions (1,963) (14,301) (523) 3 (16,784) Contributions made (10,872) (4,722) (1,574) - (17,168) Increase in net OPEB obligation 10, ,419 29,524 4, ,901 Net OPEB obligation - beginning of year 87, , ,918 17, ,435 Net OPEB obligation - end of year $ 97,676 $ 520,037 $ 188,442 $ 22,181 $ 828,336 47

108 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2017 The District s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net OPEB obligation for the last three fiscal years is as follows: Percentage of Annual Annual OPEB Fiscal Year OPEB Cost Net OPEB Ended Cost Contributed Obligation June 30, 2015 $ 96, % $ 539,799 June 30, 2016 $ 174, % $ 677,435 June 30, 2017 $ 184, % $ 828,336 D. METHODS AND ASSUMPTIONS The annual required contribution was determined as part of a June 30, 2017 actuarial valuation using the entry age normal actuarial cost method. This is a projected benefit cost method, which takes into account those benefits that are expected to be earned in the future as well as those already accrued. The actuarial assumptions included (a) 4.0% investment rate of return, (b) 3.25% projected annual salary increase and health care cost trend increasing from 7.5% to 4.5% annually 11. FUND BALANCES The District reports fund balances in accordance with Governmental Accounting Standards Board Statement No. 54. All fund balance categories are reported in the aggregate on the face of the balance sheet. All components of those fund balances and specific purposes are identified as follows: Capital General Projects Building Fund Fund Fund Totals Nonspendable: Prepaid Expenses $ 2,199 $ - $ - $ 2,199 Committed: Capital projects - 1,311, ,311,762 Fire 1,109, ,109,736 Roads 715, ,134 Total committed 1,824,870 1,311, ,136,632 Unassigned 5,487, ,487,771 Total Fund Balances $ 7,314,840 $ 1,311,726 $ 36 $ 8,626,602 48

109 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, RISK MANAGEMENT The District is a member of two jointly governed organizations, which provide coverage for various potential losses. For workers compensation losses, property, general and auto liability and auto physical damage the District is a member of Special Districts Risk Management Authority (SDRMA). For property, general and auto liability and auto physical damage, the District s fire department is a member of Fire Agencies Insurance Risk Authority (FAIRA). SDRMA and FAIRA are governed by Boards consisting of representatives from member agencies. The Board controls the operations, including selection of management and approval of operating budgets, independent of any influence by the member agencies beyond their representation on the Board. Each member agency pays a contribution commensurate with the level of coverage requested and shares surpluses and deficits proportionate to their participation in the joint powers authority. Full financial statements are available seperately from the respective agencies. Condensed information for SDRMA and FAIRA are as follows: SDRMA FAIRA June 30, 2017 June 30, 2017 Total Assets $ 111,852,055 $ 3,213,773 Deferred Outflows of Resources $ 637,936 $ - Total Liabilities $ 62,077,098 $ 12,441 Deferred Inflows of Resources $ 171,678 $ 50, Net Position $ 50,241,215 $ 3,150,332 Total Revenues $ 65,807,742 $ 2,512,365 Total Expenses $ 67,709,911 $ 2,476,393 Change in Net Position $ (1,902,169) $ 35, SUBSEQUENT EVENTS Management has reviewed its financial statements and evaluated subsequent events for the period of time from its year ended June 30, 2017 through November 30, 2017, the date the financial statements were issued. Management is not aware of any subsequent events other than the issuance of refunding bonds described below that would require recognition or disclosure in the accompanying financial statements. 49

110 REQUIRED SUPPLEMENTARY INFORMATION

111 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2017 Variance with Final Budget Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) REVENUE Taxes and assessments $ 5,269,200 $ 5,269,200 $ 5,168,557 $ (100,643) Fees and other non-tax revenue 62,586 52, , ,343 Interest 24,700 24,700 38,322 13,622 Fire mitigation fees 5,000 6,000 36,132 30,132 Reimbursable revenues 1,268,017 1,268, ,433 (883,584) Other 101, , ,209 1,050 Total revenue 6,730,662 6,721,662 6,154,582 (567,080) EXPENDITURES General government 105, ,500 95,301 10,199 Public safety 4,505,542 4,561,522 4,622,197 (60,675) Streets 88,058 88, ,886 (149,828) Trails 1,259,610 1,259, , ,339 Total expenditures 5,958,710 6,014,690 5,274, ,035 Excess (deficiency) of revenues over (under) expenditures 771, , , ,955 OTHER FINANCING USES Transfers in/(out) (38,143) (38,143) (38,143) - NET CHANGES IN FUND BALANCES 733, , , ,955 FUND BALANCE, beginning of year as restat 5,463,082 5,463,082 6,473,056 1,009, FUND BALANCE, end of year $ 6,196,891 $ 6,131,911 $ 7,314,840 $ 1,182,929 50

112 NORTHSTAR COMMUNITY SERVICES DISTRICT SCHEDULE OF FUNDING PROGRESS OTHER POSTEMPLOYMENT BENEFITS FOR THE YEAR ENDED JUNE 30, 2017 Actuarial Accrued Actuarial Unfunded Annual UAAL Actuarial Liability (AAL) Value of Liability Funded Covered as a % Valuation Entry Age Assets (UAAL) Status Payroll of payroll Date (a) (b) (a-b) (b/a) (c) ([a-b]/c) June 30, 2010 $ 632,805 $ - $ 632,805 0% $ 2,849, % June 30, 2013 $ 820,225 $ - $ 820,225 0% $ 2,937, % June 30, 2016 $ 1,568,640 $ - $ 1,568,640 0% $ 3,389, % See accompanying notes to required supplementary information. 51

113 NORTHSTAR COMMUNITY SERVICES DISTRICT SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY FOR THE YEAR ENDED JUNE 30, 2017 Miscellaneous June 30, 2014 June 30, 2015 June 30, 2016 (1) Proportion of the net pension liability % % % Proportionate share of the net pension liability $ 1,602,716 $ 1,888,527 $ 2,247,126 Covered-employee payroll (2) $ 1,788,281 $ 1,832,525 $ 1,963,610 Proportionate share of the net pension liability as percentage of covered-employee payroll 89.62% % % Plans fiduciary net position as a percentage of the total pension liability 83.03% 79.89% 79.89% Proportionate share of aggregate employer contributions (3) $ 142,978 $ 289,450 $ 539,707 Safety June 30, 2014 June 30, 2015 June 30, 2015 (1) Proportion of the net pension liability % % % Proportionate share of the net pension liability $ 1,889,349 $ 2,174,274 $ 2,802,632 Covered-employee payroll (2) $ 1,846,024 $ 1,896,823 $ 1,920,598 Proportionate share of the net pension liability as percentage of covered-employee payroll % % % Plans fiduciary net position as a percentage of the total pension liability 83.03% 77.28% 77.28% Proportionate share of aggregate employer contributions (3) $ 234,378 $ 424,982 $ 598,928 (1) Historical information is required only for measurement periods for which GASB 68 is applicable. (2) Covered-employee payroll represented above is based on pensionable earnings provided by the employer. (3) The plan's proportionate share of aggregate contributions may not match the actual contribtions made by the employer during the measurement period. The plan's proportionate share of aggregate contributions is based on the plan's proportion of fiduciary net position shown on line 5 of the table above as well as any additional side fund (or unfunded liability) contributions made by the employer during the measurement period. See accompanying notes to required supplementary information. 52

114 NORTHSTAR COMMUNITY SERVICES DISTRICT SCHEDULE OF PENSION CONTRIBUTIONS FOR THE YEAR ENDED JUNE 30, 2017 Miscellaneous Fiscal Year (1) Actuarially Determined Contribution (2) $ 289,450 $ 289,450 $ 539,707 Contributions in relation to the actuarially determined contributions (2) (420,688) (443,802) (324,538) Contribution deficiencey (excess) $ (131,238) $ (154,352) $ 215,169 Covered-employee payroll (3,4) $ 1,788,281 $ 1,832,525 $ 1,963,610 Contributions as a percentage of covered-employee payroll (3) 16.19% 15.80% 27.49% Safety Fiscal Year (1) Actuarially Determined Contribution (2) $ 424,982 $ 424,982 $ 598,928 Contributions in relation to the actuarially determined contributions (2) (596,832) (624,730) (403,835) Contribution deficiencey (excess) $ (171,850) $ (199,748) $ 195,093 Covered-employee payroll (3,4) $ 1,846,024 $ 1,896,823 $ 1,920,598 Contributions as a percentage of covered-employee payroll (3) 23.02% 22.40% 31.18% (1) Historical information is required only for measurement periods for which GASB 68 is applicable. (2) (3) (4) Employers are assumed to make contributions equal to the actuarially determined contributions (which is the actuarially determined contribution). However, some employers may choose to make additional contributions towards their side fund or their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. CalPERS has determined that employer obligations referred to as "side funds" do not conform to the circumstances described in paragraph 120 of GASB 68, therefore are not considered separately financed specific liabilities. Covered-employee payroll represented above is based on pensionable earnings provided by the employer. Payroll from prior year was assumed to increase by the 3.00 percent payroll growth assumption. See accompanying notes to required supplementary information. 53

115 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO REQUIRED SUPPLEMENTARY INFORMATION FOR THE FISCAL YEAR ENDED JUNE 30, 2017 PURPOSE OF SCHEDULES A - Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual The District employs budget control by account codes and by individual appropriation accounts. Budgets are prepared on the modified accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America as prescribed by the Governmental Accounting Standards Board. The budgets are revised during the year by the Board of Directors to provide for revised priorities. Expenditures cannot legally exceed appropriations by object level, which is a category of account codes such as salaries and benefits or charges for services. The originally adopted and final revised budget for the General Fund is presented as Required Supplementary Information. The budgeting is done on the cash basis which is another comprehensive basis of accounting. B - Schedule of Funding Progress - Other Postemployment Benefits The Schedule of Funding Progress presents multi-year trend information which compares, over time, the actuarially accrued liability for benefits with the actuarial value of accumulated plan assets. C - Schedule of Proportionate Share of the Net Pension Liability Changes in assumptions, in 2015, amounts reported as changes in assumptions resulted primarily from adjustments to expected retirement ages of general employees. Fiscal year 2017 was the 3rd year of implementation, therefore only three years is shown. See accompanying notes to required supplementary information. 54

116 NORTHSTAR COMMUNITY SERVICES DISTRICT NOTES TO REQUIRED SUPPLEMENTARY INFORMATION FOR THE FISCAL YEAR ENDED JUNE 30, 2017 D - Schedule of Pension Contributions If an employer's contributions to the plan are actuarially determined or based on statutory or contractual requirements, the employer's actuarially determined contribution to the pension plan (or, if applicable, its statutorily or contractually required contribution), the employer's actual contributions, the difference between the actual and actuarially determined contributions (or statutorily or contractually required), and a ratio of the actual contributions divided by covered-employee payroll. Hire date Prior to January 1, 2013 On or after January 1, 2013 Benefit formula Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life Retirement age Monthly benefits, as a % of eligible compensation 1.4% to % 1.0% to 2.5% Required employee contribution rates 7.000% 6.250% Required employer contribution rates 8.880% 6.555% Safety Prior to On or after Hire Date January 1, 2013 January 1, 2013 Benefit formula Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life Retirement age Monthly benefits, as a % of eligible compensation 3% 3% Required employee contribution rates 9% 9% Required employer contribution rates % % See accompanying notes to required supplementary information. 55

117 SUPPLEMENTARY INFORMATION

118 NORTHSTAR COMMUNITY SERVICES DISTRICT STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2017 ASSETS Balance Balance June 30, 2016 Receipts Disbusements June 30, 2017 Cash and cash equivalents Series 2005 Bonds $ 10,158,601 $ - $ 211,579 $ 9,947,022 Series 2006 Bonds 5,288,030 18,200-5,306, Refunding Bonds 57,305-2,872 54,433 Total assets $ 15,503,936 $ 18,200 $ 214,451 $ 15,307,685 LIABILITIES Due to others $ 15,503,936 $ 18,200 $ 214,451 $ 15,307,685 See accompanying notes to required supplementary information. 56

119 Potential Sales Tax Initiative to Fund Trail Maintenance & Construction DATE: December 20, 2017 TO: FROM: District Board Members Mike Staudenmayer, General Manager BACKGROUND: As previously reported, a significant funding gap exists to realize the North Lake Tahoe Tourism Master Plan vision for capital projects (namely trails) servicing our region. As such, new revenue sources are being reviewed and considered including a sales tax to fund trail construction and maintenance. Please see the attached board report from the GM of TCPUD for more detailed background. DISCUSSION: Given the Districts history with trail development and lead agency participation on the Martis Valley Trail project, it is important to work with our regional partners to strive for the highest quality facilities to best serve the public. The high cost of project implementation combined with the increased maintenance expense with every mile of trail constructed is one of the major hurdles we face in trying to implement a quality regional trail network. Revenue raised from a dedicated and restricted source would free up capital and maintenance dollars for our other general fund obligations. At this time, no action is being requested. The legislative process does have a strict schedule to follow in order to allow for the potential inclusion on a November 2018 ballot. Certain language changes are needed to move this forward. No determination will be made until further polling and special district collaboration is completed. Staff is seeking direction from the Board to support the County, NLTRA, and potentially other Special Districts that provide trail maintenance services in eastern Placer County in the planning, administrative and legislative processes necessary to get a sales tax measure to fund trail maintenance and construction on a future voter ballot. FISCAL IMPACT: Approximately $1million/year to the North Lake Tahoe region for trail construction and maintenance.

120 RECOMMENDATION: Discuss the merits of pursuing a sales tax initiative in 2018 to fund trail maintenance and construction in eastern Placer County. Direct staff consistent with the Board s decision. ATTACHMENTS: TCPUD GM Board Memo: Potential Sales Tax Initiative to Fund Trail Maintenance & Construction For Discussion and Possible Staff Direction DATE PREPARED: December 15,

121 TAHOE CITY PUBLIC UTILITY DISTRICT MEMORANDUM TO: Board of Directors DATE: December 5, 2017 FROM: Sean Barclay General Manager SUBJ: Potential Sales Tax Initiative to Fund Trail Maintenance & Construction For Discussion and Possible Staff Direction RECOMMENDATION: The Board discuss the potential of pursuing a sales tax initiative in 2018, specifically to fund trail maintenance and construction; and to consider directing staff to conduct the work necessary to begin the process. BACKGROUND: Based on recent community feedback indicating support for funding trails, and the recent success of a similar tax measure in Truckee focused on trail construction and maintenance (Measure R), there is a potential that an increase in sales tax may be met with support from voters in the North Lake Tahoe community. California Government Code - Title North Lake Tahoe Transportation Authority [ ], which took effect in 1999, established an entity to impose a sales tax ordinance for the purpose of funding an adopted transportation expenditure plan. There is an opportunity to amend the language in the existing Code in order to focus expenditure of the revenue from a.50 percent sales tax increase towards funding trail construction and maintenance. The language would also require an amendment to the Authority created under this Code. Staff has had preliminary discussion with District counsel and believe there is the possibility for creation of a Joint Powers Authority (JPA), made up Placer County and the North Lake Tahoe Special Districts that provide trail services (TCPUD, NTPUD, NSCSD, SVPSD). This JPA would allow for shared administrative costs and direct oversight of the funds to ensure that community priorities for trail funding are met. The key issue currently, is an expedited timeline in order to move forward with the work necessary to be in a position to potentially bring this initiative to the ballot at the November 2018 General Election or a special election in The amendments to the language would need to be completed by mid-january to meet the Legislative Analyst s deadline for language review and a legislative sponsor would need to be identified by the mid-february deadline for Bill introduction. Staff believe they have the outside resources necessary to meet the timelines. Additional research and work will need to be completed before undergoing a concerted effort to bring this initiative forward to an election, including completion of a voter survey, and establishing agreements with Placer County and the other Special Districts. A meeting is scheduled for December 11 th, 2017 with the agencies mentioned above to discuss possible next steps. Staff will update the Board at its December 15 th, 2017 meeting.

122 FINANCIAL IMPACT: Memorandum 7-Dec-17 Page 2 of 2 The financial impact of a potential sales tax increase dedicated to trails could be significant. A half percent sales tax increase has the potential to generate just over $1 million annually and would grow over time. In addition to the annual repair and maintenance of the trail system, the District faces significant future costs for major rehab of its existing trail system. A dedicated source of funding to provide these important trail services to our community would be an important step in assuring the long term financial viability of the extensive trail network. ATTACHMENT: Government Code North Lake Tahoe Transportation Authority [ ] REVIEW TRACKING: Submitted By: Sean Barclay, General Manager Reviewed By: Ramona Cruz, CFO/Treasurer

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127 Highlands PRD Chain Control Gate Underground Power Conduit Installation Notice of Completion DATE: December 20, 2017 TO: FROM: Board of Directors Eric Martin, District Engineer SUBJECT: Highlands PRD Chain Control Gate Underground Power Conduit Installation - Notice of Completion BACKGROUND: The Notice of Completion (NOC) for a Project marks the formal completion date and requires Board authorization to process. Once processed by the District, the NOC is filed with the Placer County Recorder s Office. Thirty-five (35) days after the Notice is filed with Placer County, retention is released to the Contractor. The purpose of this process is to ensure all subcontractors and material providers have a chance to file protests against the General Contractor prior to issuing the retention payment. In the unlikely event that a protest is filed and a subcontractor or material provider is due additional compensation, the District would have money held as retention to pay these expenses directly. DISCUSSION: Highlands PRD Chain Control Gate Underground Power Conduit Installation has been completed by AM-X construction and Excavation, Inc. No change orders were processed for this work. RECOMMENDATION: Approve the filing of the Notice of Completion for the Highlands PRD Chain Control Gate Underground Power Conduit Installation. FISCAL/RESOURCE IMPACTS: The total contract price totals $24, This expense will be reimbursed through the Highlands PRD as approved in advance. ATTACHMENTS: 1. Notice of Completion for the Highlands PRD Chain Control Gate Underground Power Conduit Installation. DATE PREPARED: December 14, 2017

128 Recording Requested by: Northstar Community Services District When recorded, please return to: Northstar Community Services District 900 Northstar Drive Truckee, California NORTHSTAR COMMUNITY SERVICES DISTRICT NOTICE OF ACCEPTANCE OF COMPLETION NOTICE IS HEREBY GIVEN: 1. That the name and address of the public entity for whom the public work was done, as owner thereof, is: Northstar Community Services District, 900 Northstar Drive, Truckee, CA That on December 20, 2017 the hereinafter described project was accepted as completed pursuant to minute order of the Northstar Community Services District Board of Directors, the awarding authority. 3. That the project, the subject of this Notice, is generally described and identified as follows: Highlands PRD Chain Control Gate Underground Power Conduit Installation. The work consisted of the installation of underground power conduit to serve the Highlands View Road Caltrans Chain Control Gate per Liberty Utilities requirements and project drawings in Placer County, CA. 4. The name of the contractor for the project was: AM-X Construction & Excavation, Inc., and the name of the surety or sureties is: InterWest Insurance Services. 5. Total price for the above-described work was $24, DATED: December 20, 2017 NORTHSTAR COMMUNITY SERVICES DISTRICT By: Michael Staudenmayer General Manager CERTIFICATION I certify and declare under penalty of perjury that the foregoing is true and correct. Jim Bowling Secretary of the Board Date and Place

129 Highlands PRD Chain Control Gate Gate System Materials Purchase DATE: December 20, 2017 TO: FROM: Board of Directors Eric Martin, District Engineer SUBJECT: Highlands PRD Chain Control Gate Gate System Materials Purchase BACKGROUND: Caltrans, Placer County, and the Highlands Permanent Road Division #7 (PRD) Committee have collaborated on plans to install a new chain control gate at the intersection of Highlands View Road and the entrance to Sawmill Heights Apartments. The purpose of this gate, which is to be closed when Caltrans enforces chain control on Highway 267, is to prevent vehicles from getting stuck or damaging the lower chain control gate at the intersection of Highlands View Road and Highway 267. The District is in contract with Placer County to perform certain road maintenance tasks for the PRD, and the County has requested that the District take the lead on delivering this gate project in time for use this winter. The District contracted with AM-X Construction as approved by the Board in October to install the power conduit to service the gate. This work has now been completed. DISCUSSION: A proposal was sought from Tholl Fence to purchase the gate system materials package. The proposal has been reviewed and approved by the PRD committee. RECOMMENDATION: Approve the purchase of the Tholl Fence gate materials package for $32, FISCAL/RESOURCE IMPACTS: Tholl Fence s gate materials proposal totals $32,987. All expenses incurred are to be reimbursed under the Highlands PRD contract with Placer County. ATTACHMENTS: Tholl Fence Materials Proposal Dated December 5, DATE PREPARED: December 14, 2017

130 ESTABLISHED 1912 NEVADA LICENSE 5493 A CALIFORNIA LICENSE Glendale Avenue P.O. Box 855 Sparks, Nevada Telephone Fax December 5, 2017 Mr. Eric Martin Northstar Community Services District 900 Northstar Drive Truckee, CA Subject: Snow Control Gate Systems Dear Mr. Martin, Tholl Fence Company Inc. is pleased to confirm our MATERIALS ONLY quotation on subject project as follows. We propose to furnish and install (2) access controlled gates to meet the following specifications. There are to be TWO gate operators functioning as a master/slave tandem operating system. This pair of gates will have the following equipment and controls: Gate Operators: (2) each 20 Autogate Vertical Pivot Lift gate UL325 approved 24 volt filling a +/- 40 wide roadway. Standard green in color Gate Operator Pads: EXCLUDED (See below) Gate: Autogate s Barracuda 200 barrier gate beam-type Standard Green color Heating devices: (2) heat mats and motor coiled heaters are included Loop Detectors: NONE (Command open/command close) Vehicle Detectors: NONE Battery Backup: Built-in on board Radio Receiver: (1) Multicode dip-switch type. Radio Transmitters: NONE provided in base quotation. Fire Department Access: (1) Click2Enter with heater plus (1) Knox keyswitch EXCLUSIONS We are EXCLUDING from our quotation the following items: All labor, concrete, the two 4 wide x 7 long x 36 deep concrete pad for the gate operators at each location. These will be provided in our labor proposal All high and low voltage electrical requirements for both power and control. These will be provided in our labor proposal All conduits and Christy boxes and their installation by Northstar CSD All cable, wire, circuit breakers and their installation. All excavation, backfill, compaction etc. by Northstar CSD All hand transmitters for Entry Gates by Northstar CSD Building Permit or fees Quality through Experience

131 QUOTATION Tholl Fence Company Inc. proposes to furnish ONLY two gate operators, gates and controls as specified above FOB the job site... $32, If I can be of any further assistance, please don t hesitate to call. Very truly yours, Steve Appelbaum Tholl Fence, Inc. 800 Glendale Avenue PO Box 855 Sparks, NV fax stevea@thollfence.com Quality through Experience

132 DATE: December 20, 2017 Highlands PRD Chain Control Gate Installation Services TO: FROM: Board of Directors Eric Martin, District Engineer SUBJECT: Highlands PRD Chain Control Gate Installation Services BACKGROUND: Caltrans, Placer County, and the Highlands Permanent Road Division #7 (PRD) Committee have collaborated on plans to install a new chain control gate at the intersection of Highlands View Road and the entrance to Sawmill Heights Apartments. The purpose of this gate, which is to be closed when Caltrans enforces chain control on Highway 267, is to prevent vehicles from getting stuck or damaging the lower chain control gate at the intersection of Highlands View Road and Highway 267. The District is in contract with Placer County to perform certain road maintenance tasks for the PRD, and the County has requested that the District take the lead on delivering this gate project in time for use this winter. The District contracted with AM-X Construction as approved by the Board in October to install the power conduit to service the gate. This work has now been completed. DISCUSSION: A proposal was sought from Tholl Fence to install the gate system. The proposal has been reviewed and approved by the PRD committee. RECOMMENDATION: Approve the Award of a contract with Tholl Fence to install the chain control gate for $24, FISCAL/RESOURCE IMPACTS: Tholl Fence s gate installation proposal totals $24,301. All expenses incurred are to be reimbursed under the Highlands PRD contract with Placer County. ATTACHMENTS: Tholl Fence Gate Installation Proposal Dated December 5, DATE PREPARED: December 14, 2017

133 ESTABLISHED 1912 NEVADA LICENSE 5493 A CALIFORNIA LICENSE Glendale Avenue P.O. Box 855 Sparks, Nevada Telephone Fax December 5, 2017 Mr. Eric Martin Northstar Community Services District 900 Northstar Drive Truckee, CA Subject: Snow Control Gate Systems Dear Mr. Martin, Tholl Fence Company Inc. is pleased to confirm our LABOR AND SUBCONTRACTOR quotation on subject project as follows. All work will include California Prevailing Wage Rates. We propose to install (2) access controlled gates to supplement the material quotation itemized on a separate proposal. Included are furnishing and installing (2) large concrete mounting pads, installation of all access controls specified, making final electrical connections in the context of our own equipment, testing, tuning, adjustments and warranty follow-up. ELECTRICAL Also included is our electrical subcontractor who will perform the following: 1. Furnish and install 200A meter/main per Liberty Energy Standards. 2. Furnish and install 120V 20A circuits to two Tholl provided controllers. 3. Furnish and install Belden # /4 shielded cable to each controller. EXCLUSIONS We are EXCLUDING from our quotation the following items: 1. All conduits and Christy boxes and their installation by Northstar CSD 2. All excavation, backfill, compaction etc. by Northstar CSD 3. All hand transmitters for Entry Gates by Northstar CSD 4. Excavation, backfill, shoring, concrete encasement, rebar and bedding. 5. Permit and Engineering Fees. 6. Traffic Control other than orange cones and caution tape during any lane closure required. 7. Concrete/ Asphalt Sawing and Patching. 8. Overtime. 9. Underground Conduit and Pull Boxes. QUOTATION Tholl Fence Company Inc. proposes to furnish ONLY the installation of two gate operators, gates and controls and electrical as specified above complete and in place... $24, Includes payment and performance bonds Quality through Experience

134 If I can be of any further assistance, please don t hesitate to call. Very truly yours, Steve Appelbaum Tholl Fence, Inc. 800 Glendale Avenue PO Box 855 Sparks, NV fax stevea@thollfence.com Quality through Experience

135 Schaffer s Mill No. 3C Facilities Agreement DATE: December 20, 2017 TO: FROM: District Board Members District Engineer Martin SUBJECT: Schaffer s Mill No. 3C Facilities Agreement with New Martis Partners, LLC. BACKGROUND: Upon acquisition of the Martis Valley Water System (Zone 4), the District assumed permitting authority for new development. PCWA set a precedence of executing Facilities Agreements for development projects within Zone 4. These agreements bind the developer to certain requirements for construction and acceptance of new water infrastructure and facilities. Staff desires to continue the practice of executing Facilities Agreements for new development projects. DISCUSSION: New Martis Partners is currently proposing to develop the Schaffer s Mill Phase 3C subdivision which will be comprised of approximately 46 residential lots. Provisions of the District s standard reimbursement agreement have been incorporated In the Facilities Agreement. FISCAL/RESOURCE IMPACTS: Costs incurred by the District are to be reimbursed by the Developer per the agreement. RECOMMENDATION: Staff recommends execution of the Facilities Agreement. ATTACHMENTS: Facilities Agreement Schaffer s Mill No. 3C DATE PREPARED: December 14, 2017

136 NORTHSTAR COMMUNITY SERVICES DISTRICT FACILITIES AGREEMENT SCHAFFER S MILL NO. 3C NORTHSTAR COMMUNITY SERVICES DISTRICT NEW MARTIS PARTNERS, LLC THIS AGREEMENT, by and between NORTHSTAR COMMUNITY SERVICES DISTRICT, hereinafter called "District," and NEW MARTIS PARTNERS, LLC, a Delaware Limited Liability Company, hereinafter called the "Applicant" and collectively known as the Parties, shall be effective on the date executed by the District. W I T N E S S E T H: WHEREAS, the Applicant has requested a pipeline extension off of the District s Martis Valley Water System/Timilick Pressure Zones to provide water service to Schaffer s Mill Phase 3C, hereinafter referred to as the "Service Area," as shown on Exhibit A attached hereto and incorporated herein by reference and on a set of plans entitled Schaffer s Mill Phase 3C, prepared by Auerbach Engineering Corp., P.O. Box 5399, Tahoe City, CA 96145, which is herein referred to as the Project, containing 46 single family residential lots ( , , SF1- SF11); and WHEREAS, service to the Service Area will require the installation of approximately 3,130 linear feet (LF) of 8-inch pipe, eight (8) fire hydrants, twenty-one (21) 2 double service laterals for 1 disk meters, four (4) 2 single service laterals for 1 disk meters, and associated appurtenances, which will be described more fully in the plans to be prepared by the Applicant, and which are hereinafter referred to as the "Facilities"; and WHEREAS, the Applicant desires to connect the Facilities to the District s water system and have the District assume ownership of such Facilities and the responsibility for furnishing water service therefrom; and WHEREAS, the District is willing to accept the Facilities in accordance with the provisions of this Agreement, the District s Water Ordinance which includes Technical Provisions and Standard Drawings; and the Rates and Charges presented in Chapter 4, Articles of the Placer County Water Agency Rules, Regulations, Rates and Charges Governing the Distribution and Use of Water. WHEREAS, the District and Applicant agree that the Schaffer s Mill community is annexed into the District s service area; and WHEREAS, the Applicant intends to engage a qualified contractor and has Page 1

137 agreed to bear all expense to furnish and install the Facilities as required; and WHEREAS, the Applicant acknowledges that the District makes no commitments to supply water to the Service Area until the Service Installation/Meter Set and Backflow Prevention Device Charges have been paid to the District. NOW, THEREFORE, IT IS AGREED as follows: 1. Reimbursement: It is agreed by the Parties that the District will incur expenses in connection with the Project and that Applicant is willing to reimburse District for such expenses. (a) The District will retain those consultants ( Consultants ) set forth in Exhibit B in connection with the Project and reserves the right to retain or modify the list of consultants as it deems necessary for the Project. This Agreement and Applicant s obligation to reimbursement hereunder, shall apply to each such additional or new Consultant. (b) All costs for the Project ( Costs ), including, without limitation, Consultant s fees and costs pursuant to Professional Service Agreements, District staff time for the Project, and any related equipment costs and direct expenses will be determined monthly by the District. District shall, in its reasonable discretion, pay Costs as and when due. District shall submit to Applicant on a monthly basis invoices for such Costs paid by District. (i) District hereby acknowledges that Applicant has a single monthly draw process with invoices collected for Project expenses on or before the 25 th of the month and shall endeavor to submit its monthly invoice to Applicant by this date. (ii) District shall determine its staff time based upon (a) the total hourly cost to District for its employees who spend time in connection therewith, including supervisory personnel, at its standard generally-applicable rates multiplied by (b) the tracked actual number of hours so spent by each such employee. District will further reasonably determine its equipment costs and direct expenses incurred hereunder based on its standard generally-applicable rates. (iii) Any District payment of Costs shall not relieve Applicant s obligation to reimburse District under this Agreement. In addition to any other remedies provided under this Agreement or by law, Applicant s failure to reimburse District for undisputed Costs may result in District s suspension of work on the Project until Applicant makes such reimbursement payment. (iv) At any time District may request that Applicant forward to Page 2

138 District funds, as estimated by the District, to pay for one or more Costs in advance (Advanced Funds). Upon District s payment of actual Costs, District shall refund to Applicant any overpayment. Upon Applicant s request, District shall endeavor to provide an advance estimate of Costs to be incurred for the District s review and implementation of this Agreement, though the estimate shall be an estimate only and Applicant shall be responsible for reimbursing all Costs, even if in excess of the Estimate. 2. Water Connection Fees and Water Meter Installation Charge: Water connection fees will not be assessed; however, Water Meter Installation Charges are to be paid on an individual basis prior to the establishment of the water service connections. 3. Termination: This Agreement shall become effective upon execution by the District. If the installation of the Facilities provided for herein is not commenced within one (1) year after the date of execution of this Agreement by the District and completed within twenty four (24) months after that date, the District shall have the right to terminate this Agreement at any time thereafter. Additionally: (a) District may terminate this Agreement at any time if Applicant fails to comply with the terms hereof. Before terminating this Agreement for failure to comply, District shall give Applicant not less than 15 days written notice of its intent to do so and shall afford Applicant the right to cure its default in its performance during said period. District may stop Consultant work during this time. (b) Applicant may terminate its participation in the Agreement without liability to any party at any time by giving 45 (forty-five) days written notice to District, such termination shall not relieve Applicant of Obligation to make payments to District for Costs incurred prior to effective date of the termination, provided however, that District shall not incur additional liabilities for such services after receiving notice of termination from Applicant. (c) Upon termination by either the District or Applicant, the District shall refund any portion of the WCF not used by District for the discharge of outstanding Costs shall be returned to Applicant immediately. 4. Plans: It is the responsibility of the Applicant to prepare plans and specifications for installing the Facilities and submit them to the District for acceptance. All materials to be furnished and all construction shall be in accordance with the District s Standard specifications, Technical Provisions and Standard Drawings. The plans and specifications, when accepted in writing by the District, shall become a part of this Agreement. Any plans, studies, documents or Page 3

139 other writings, if any, prepared by and for District by the Consultants retained by District in accordance with the terms of this Agreement, except working notes and internal documents, shall be shared property of the District and Applicant, and Applicant shall have joint rights to use such material in their discretion without further compensation to District or Consultants. 5. Installation of Facilities: The Applicant shall install the Facilities described in the plans and specifications accepted by the District in accordance with the provisions of this Agreement and the District s Standard specifications, Technical Provisions and Standard Drawings. No installation may be made except by a California State Licensed Class A or C-34 contractor or forces approved by the District. The Applicant shall comply with all laws and regulations, including any prevailing wage and other employment laws and regulations such as California Labor Code Sections 1720 et seq., to the extent they are applicable to installation of the Facilities. 6. Property and Rights-of-Way: The Applicant shall convey easements and/or fee titles acceptable to the District on and over the properties that contain or will contain Facilities, as determined during plan review, to be conveyed to the District in accordance with this Agreement. In order to be acceptable to the District, the grants of easements or fee titles shall include consents or endorsements of all lienholders, lessees or other parties with any interest in the properties being conveyed. Any costs incurred by the District in acquiring the required easements and fee titles, including the cost of escrow fees, other than any costs for title insurance, shall be charged to the Applicant per paragraph 1, Item 1(a). The Applicant shall also provide the District with two (2) copies of the recorded final map with APN and addresses marked for each lot or parcel within 30 (thirty) days of map recording and Placer County assignment of APN and addresses prior to the District s acceptance of the Facilities. 7. Grade Established: No work on water facilities or infrastructure shall be performed or installation made until street subgrades have been established to the satisfaction of the District. 8. Inspection: The District shall provide one or more inspectors to inspect the installation of the Water Facilities. The cost of inspection shall be reimbursed by the Applicant pursuant to the provisions set forth in Section Area Not to be Served Before Acceptance: No water shall be served to the Service Area until the District has received payment of the Water Meter Installation Charges for the portion of the Service Area to receive service. Service Page 4

140 will only be provided to unoccupied structures such as model homes and landscaping in advance of final acceptance and only with prior written approval by the District. 10. Acceptance: The District assumes no obligation for maintenance of the Facilities included in this Agreement until such time as they are formally accepted in writing by the District. Any costs incurred by the District due to emergency or other repairs prior to final acceptance by the District shall be billed to, and paid by, the Applicant. Upon written acceptance of the Facilities by the District, the District will be responsible for furnishing water service to connections where meters have been installed and all terms required by the District s Rules and Regulation Governing the Distribution and Use of Water are satisfied. The Applicant shall be notified in writing of acceptance of such Facilities when they are satisfactorily installed in accordance with the District Accepted Plans and the District s current Standard Specifications, Technical Provisions and Standard Drawings, all grading and paving is completed, all Costs are paid, all required easements received, accepted and recorded by the District; the required maintenance guarantee is posted; Immediately upon acceptance all rights, titles, and interest in the pipeline extension, and all other Facilities therein mentioned, shall be vested in the District. 11. User Fees and Charges for Water Service: The customers in the service area shall begin paying the District s rates and charges for treated water six months after the Facilities are completed and accepted by the District, or on the date they begin taking water, whichever is earlier. These charges will become due and payable at that time because the District will be incurring costs for the operation and maintenance of wells, transmission, distribution, pumping facilities, storage tanks, and other facilities that are required to be operated and maintained in order to serve the Applicant s Service Area with water upon the acceptance of the Facilities. 13. Indemnification: The Applicant shall assume the defense of, and will indemnify and save harmless the District, each of its officers, its directors, and employees (collectively, the Indemnified Parties ), from and against all actions, claims, costs, losses, damages and expenses, including attorney s fees of any type and description to which Indemnified Parties may be subjected or put, by reason of or arising out of any acts or omissions of Applicant or any of its officers, employees, contractors, and agents in connection with the Project, except for any action, damages, claims, losses or expenses arising out of the sole negligence or willful misconduct of the Indemnified Parties. 14. Economic Security: The estimated cost of the Facilities is $384,750. Page 5

141 Prior to construction of any of the Facilities and during all such construction, the Applicant or Applicant s Contractor shall provide a Performance Bond, Letter of Credit, or Cash Escrow Deposit ( Security ) with a sum of 100% of the estimated cost of the Facilities as determined by the Project civil engineer using Placer County worksheets. As work is completed in the field and reviewed by District, the amount of Security shall be reduced by the amount of work completed as determined by the Project civil engineer using Placer County worksheets. The Applicant shall maintain the Security at all times until the District accepts the Facilities. The District may provide written waiver of the requirement for the Security if the Applicant demonstrates that it has provided a comparable Security to another public entity pursuant to Government Code Section , which Security encompasses the installation of the Facilities and names the District as a co-obligee. After completion of work and before acceptance by the District, a Maintenance Bond in the amount of 10% of the cost of the Facilities shall be provided to the District by the Applicant or the Applicant s Contractor. The maintenance bond shall be in a form substantially as that attached hereto as Exhibit C, that is acceptable to the District. A cash deposit in an amount adequate to cover such guarantee may be provided. Such maintenance guarantee shall remain good for a period of one (1) year after acceptance by the District of the Facilities. All bonds shall be issued by California admitted surety insurers. 15. Special Conditions: (a) WATER RATE IMPACTS: The Applicant shall notify all Shaffer s Mill customers in Pressure Zone 2 that their water rates will be higher than those customers in Pressure Zone 1 because of the added cost of power and operating and maintaining pumping stations by the District. 16. Placing Work in Service: If desired by the District, portions of the work may be placed in service or locked off when completed, and the Applicant and/or the Applicant s Contractor shall provide proper access to the work for this purpose. Such use and operation shall not constitute an acceptance of the work, and the Applicant and/or the Applicant s Contractor shall be liable for defects due to faulty construction throughout the duration of this Agreement and thereafter as provided under Warranties and Repairs. 17. Warranties and Repairs: The Applicant hereby agrees to pay to the District or to make at his own expense, all repairs, replacements or payments necessitated by defects in materials or workmanship supplied under the terms of Page 6

142 this Contract which exist within one year after the date of final acceptance of the work. Subject to the limitations of California Code of Civil Procedure Section this Agreement shall cover defects which shall be in existence during such one year period but which shall not become apparent until thereafter. The Applicant shall be fully responsible for all direct and indirect damages and expenses to the District proximately caused by such defects in materials or workmanship including defects in materials or workmanship supplied to the Applicant s Contractor by any subcontractor or manufacturer or equipment. As to any equipment which bears a guarantee or warranty in writing or by law for a period longer than one year, the Applicant hereby stipulates and agrees that such guarantee shall inure to the benefit of the District for such longer period. The Applicant shall make all repairs and replacements or payments promptly upon receipt of written order for same from the District. If the Applicant fails to make the repairs, replacements or payments promptly, the District may do the work, and the Applicant and his Surety shall be liable for the cost thereof. 18. Ownership of Area to be Served: The Applicant warrants that the owner of the Service Area is: New Martis Partners, LLC Knoll Trail, Suite 130 Dallas, TX If this Agreement is not signed by the owner of such property, the Applicant warrants that in executing this Agreement he or she is acting as the duly authorized agent of such owner and executes this Agreement for and on behalf of the owner and the Applicant; however, in addition thereto, the District reserves the right to require such owner to agree to or acknowledge this Agreement, as a condition of the District s approval of the Agreement. 19. Assignment of Agreement: The provisions of this Agreement shall apply to and bind the successors and assigns of the respective parties, but no assignment or transfer of this Agreement, or any part hereof, or interest herein, shall be valid until and unless approved by the District, which consent District shall not unreasonably withhold. 20. Law: This Agreement shall be construed and enforced in accordance with the laws of the State of California. Any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Should any legal action be brought by a party for breach of this Agreement or to enforce any provision herein, the prevailing party of such action shall be entitled to reasonable attorney s fees, court costs and such other costs as may be fixed by Page 7

143 the Court. 21. Notices: Notices, demands, correspondence, and other communications to District and Applicant shall be deemed given if dispatched by prepaid, firstclass mail to the following addresses: NCSD New Martis Partners, LLC 900 Northstar Drive Knoll Trail Drive Truckee, CA Suite 130 ATTN: General Manager Dallas, TX With a Copy to: Downey Brand 621 Capitol Mall, 18 th Floor Sacramento, CA Any party may advise the other, in writing, of any other address to which such notices shall be given. Nothing contained in this Section 17 prevents the Parties from effecting delivery by personal service. 22. Agreement: This Agreement contains the entire Agreement between the Parties with respect to the matter s herein. Furthermore: (a) Nothing in this Agreement shall be construed as a commitment on the part of District to approve any proposal or take any action, nor limit the discretion of District s Board of Directors or District s power and authority. (b) This Agreement may be amended or modified only by written instrument signed by all parties. (c) This Agreement may be executed in counterparts, each of which shall be deemed an original. (d) No person or entity shall be deemed to be a third party beneficiary hereof; and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than District (and its officers, directors, employees and agents providing service under this Agreement) and Applicant, any rights, remedies, obligations or liabilities under or by 23. As used herein, the singular of any words includes the plural, and terms in the masculine gender shall include the feminine. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date written below. Page 8

144 NORTHSTAR COMMUNITY SERVICES DISTRICT BY: Date: ATTEST: New Martis Partners, LLC (a Delaware Limited Liability Company) BY: Caprock Development LLC, a Delaware Limited Liability Company, its Sole Manager Signature Print Name Title: Date: Attach Exhibit A Draft Plans Page 1

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146 Page 2

147 EXHIBIT B LIST OF CONSULTANTS Consultant Name Farr West Engineering Services Construction Inspection Services Page 3

148 EXHIBIT C MAINTENANCE BOND (1 of 2) KNOW ALL MEN BY THESE PRESENTS: That, WHEREAS, the Northstar Community Services District ( NCSD ), and New Martis Partners, LLC (hereinafter designated as "Applicant") have entered into an agreement dated (the "Agreement") whereby Applicant agreed to install and complete certain designated public improvements, and identified as: Project Name: Facilities Agreement No.: ; and WHEREAS, said Applicant is required under the terms of said Agreement to furnish a bond for the maintenance and guarantee of said improvements; NOW, THEREFORE, we the Applicant, and, as surety, are held and firmly bound unto the NCSD, Placer County, California, in the penal sum of Dollars ($ ), lawful money of the United States, being ten percent (10%) of the cost of the Facilities, for the payment of which sum well and truly to be made, we bind ourselves, our heirs, executors, administrators and successors, jointly and severally, firmly by these presents. As a condition precedent to the satisfactory completion of the said Agreement, the above obligation shall hold good for a period on one (1) year after the completion and acceptance of the said work, during which time, if the above bounden Applicant, Applicant s heirs, executors, administrators, successors or assigns shall fail to make full, complete and satisfactory repair and replacements or totally protect the said the NCSD from loss or damage made evident during said period of one (1) year from the date of acceptance of said work, and resulting from or caused by defective materials or faulty installation, in the prosecution of the work done, the above obligation shall be and remain in full force and virtue. And the said Surety, for value received, hereby stipulates and agrees to waive the benefits of California Civil Code Sections 2819 and In the event the NCSD, or its successors or assigns, shall be the prevailing party in an action brought upon this bond, then, in addition to the penal sum hereinabove specified, we agree to pay to the said the NCSD, or its successors or assigns, a reasonable sum on account of attorney's fees in such action, which sum shall be fixed by the court. Page 4

149 MAINTENANCE BOND (2 of 2) In WITNESS THEREOF, the above bounden parties have executed this instrument under their seals this day of, 20, the name and corporate seal of each corporate party being hereto affixed, and these presents duly signed by its undersigned representative, pursuant to authority of its governing body. ATTEST: Applicant Secretary (SEAL) By: Applicant Witness as to Applicant Witness to Surety Address Surety Address Telephone Attorney-in-Fact Address Page 5

150 If Applicant is partnership, all partners must execute BOND. The signature of the Surety on this bond must be acknowledged before a Notary Public. Page 2

151 Resolution 17-XX Accepting Offer Of Dedication of Water Facilities Schaffer s Mill Phase 3B, Tract No. ESD DATE: December 20, 2017 TO: FROM: District Board Members Eric Martin, District Engineer SUBJECT: Resolution Accepting Offer of Dedication of Water Facilities for the Schaffer s Mill Phase 3B subdivision. BACKGROUND: The Schaffer s Mill Phase 3B subdivision was developed by New Martis Partners. The development consists of 41 residential lots. DISCUSSION: Upon dedication of water facilities for the project, the District will own and maintain these facilities into perpetuity. FISCAL/RESOURCE IMPACTS: None RECOMMENDATION: Approve Resolution 17-XX accepting an Irrevocable Offer of Dedication for Water Facilities for the Schaffer s Mill Phase 3B Subdivision. ATTACHMENTS: Resolution 17-XX, Irrevocable Offer of Dedication DATE PREPARED: December 14, 2017.

152 BOARD OF DIRECTORS NORTHSTAR COMMUNITY SERVICES DISTRICT RESOLUTION 17-XX RESOLUTION ACCEPTING OFFER OF DEDICATION OF WATER FACILITIES Schaffer s Mill Phase 3B, Tract No. ESD AS A BASIS AND PREMISE for this Resolution, the Board of Directors ( Board ) of Northstar Community Services District ( NCSD ) finds as follows: 1. NEW MARTIS PARTNERS, LLC, a Delaware limited liability company ( Grantor ), has offered to dedicate to NCSD certain water facilities ( Facilities ). 2. Dedication of the Facilities will be made by the Grantor s execution and delivery of an Irrevocable Offer of Dedication ( IOD ), for the Facilities for the Schaffer s Mill Phase 3B Project, that is in proper form. 3. The Facilities described in the IOD meet NCSD s standards for acceptance, and the Grantor has supplied the necessary guarantee required under NCSD s ordinances. 4. In accordance with applicable provisions of the Facilities Agreement between Grantor and NCSD, Grantor has offered a warranty bond totaling 10% of the cost of the Water Facilities. 5. It would be in the best interests of NCSD to accept the IOD referred to herein. NOW, THEREFORE, the NCSD Board of Directors RESOLVES, ADJUDGES and ORDAINS as follows: 1. The Irrevocable Offer of Dedication of the Facilities in Schaffer s Mill Phase 3B, Tract No. ESD are hereby accepted. 2. The President or the General Manager are hereby authorized and directed to execute the Acceptance of the IOD, and any other documents necessary to carry out the intent of this Resolution. The foregoing resolution was duly passed and adopted by the Board of Directors of the Northstar Community Services District at a board meeting thereof, held on December 20, 2017 by the following vote:

153 AYES: NOES: ABSTAIN: ABSENT: Ives, Seelig, Smith, Green, Cravens None None None Jeann Green, President of the Board ATTEST: James Bowling, Secretary of the Board N O R T H S T A R C O M M U N I T Y S E R V I C E S D I S T R I C T 900 N O R T H S T A R D R I V E, T R U C K E E, CA P A G E 2 O F 2

154 Project Name: Schaffer s Mill Phase 3B When Recorded Mail To: Northstar Community Services District 900 Northstar Drive Truckee, CA With a copy to: New Martis Partners, LLC Knoll Tail Drive, Suite 130 Dallas, Texas This document is exempt from recording fees, pursuant to Government Code Section Above for Recorders Use Only IRREVOCABLE OFFER OF DEDICATION The undersigned owner(s), hereinafter referred to as OWNER(S), of the real property described below, do hereby make an Irrevocable Offer of Dedication to the Northstar Community Services District, hereinafter referred to as DISTRICT, a Public Agency and its successor or assign for water purposes, the Water Facilities (the Facilities ) and easements rights all of which are described on the As Built plans prepared by Auerbach Engineering Corp. on December 7, 2017, and approved and inspected by the DISTRICT. OWNER(S) convey, transfer and dedicate all rights, title, and interest in and to the Water Facilities and easements located on the real property in Placer County, California described and depicted on the following: That certain Map entitled Schaffer s Mill Phase 3B, Tract No. ESD filed for record in the Office of the Recorder of Placer County, California in Book DD of Maps, Page 82 on April 17, 2017 OWNER(S) have constructed or caused the construction and installation of the Water Facilities on the above property and do hereby assure and warrant to the DISTRICT that the contractors, subcontractors, employees or agents of the OWNER(S) have been fully and completely paid and there exist no liens, encumbrances, stop notices or claims on the Water Facilities and/or by any of the subcontractors, employees, or agents against the Water Facilities or against the DISTRICT. OWNER(S) declare under penalty of perjury that the foregoing is true and correct. Executed this day of 20 in Placer County, California. New Martis Partners, LLC, a Delaware Limited Liability Company By: Caprock Dev, LLC, A Delaware Limited Liability Company, Its Sole Manager By: Typed name: John D. Marlin Title: Manager

155 ALL-PURPOSE ACKNOWLEDGMENT Civil Code 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of ) County of ) On, 20, before me,, Notary Public, Date Name And Title Of Officer (e.g. Jane Doe, Notary Public ) personally appeared, Name(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Place Notary Seal Above Signature: ACCEPTANCE The NORTHSTAR COMMUNITY SERVICES DISTRICT hereby accepts the above Irrevocable Offer of Dedication and, subject to any warranty obligations of OWNER(S), agrees that it shall hereafter own, maintain and repair the Water Facilities. Date: Northstar Community Services District By: Michael Staudenmayer General Manager

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157 NORTHSTAR COMMUNITY SERVICES DISTRICT District Fire Chief s Supplemental Report DATE: December 20th, 2017 TO: District Board Members FROM: Firefighter Jeffrey Botto SUBJECT: Grant Agreement with Department of Forestry and Fire Protection BACKGROUND: Northstar Fire Department (NFD) had the opportunity to apply for a Cal Fire Volunteer Firefighter Assistance (VFA) grant that would replace its structural firefighting helmets and its wildland fire shelter packs. The Cal Fire VFA grant is a 50/50 financial split grant. DISCUSSION: NFD s structural firefighting helmets are nearing the end of their useful life. This is in accordance with the National Fire Protection Agency (NFPA) Standard 1851 for replacement of firefighter safety gear and personal protective equipment. This year NFD budgeted to replace 6 of its 16 total helmets. The remaining 10 helmets have one more year of useful life and would need to be replaced in the following budget cycle. With the grant opportunity provided, it makes financial sense to replace all helmets at once. NFD has started the evaluation process on various helmets for purchase. NFD s in-service fire shelters are showing signs of wear, such as discoloration and flaking. They are a personal safety item and in need of replacement prior to the 2018 wildland fire season. The web gear currently in-service has been called to repair on several occasions and has reached the end of its lifespan. The new hydration web gear systems allow firefighters easy access to drinking water when working in extreme environments. The hydration systems are compliant with OSHA standards for heat illness prevention and the NFPA 1001 Heat Injury Prevention standard. FISCAL IMPACTS: The total cost of these projects is quoted at $27, Under the terms of the agreement, 50% of the cost will be reimbursed by the Department of Forestry and Fire Protection. NFD s total contribution will not exceed $13, RECOMMENDATION: Authorize entering into grant agreement with the Department of Forestry and Fire Protection to purchase new helmets and fire shelter packs. ATTACHMENTS: Resolution, grant agreement.

158 BOARD OF DIRECTORS NORTHSTAR COMMUNITY SERVICES DISTRICT RESOLUTION A RESOLUTION APPROVING THE DEPARTMENT OF FORESTRY AND FIRE PROTECTION AGREEMENT # 7FG17096 FOR SERVICES FROM THE DATE OF LAST SIGNATORY ON PAGE 6 OF THE AGREEMENT TO JUNE 30, 2018 UNDER THE VOLUNTEER FIRE ASSISTANCE PROGRAM OF THE COOPERATIVE FORESTRY ASSISTANCE ACT OF BE IT RESOLVED by the Board of Directors of the Northstar Community Services District that said Board does hereby approve the Agreement with the California Department of Forestry and Fire Protection dated as of the last signatory date on page 6 of the Agreement, and any amendments thereto. This Agreement provides for an award, during the term of this Agreement, under the Volunteer Fire Assistance Program of the Cooperative Fire Assistance Act of 1978 during the State Fiscal Year up to and no more than the amount of $13, BE IT FURTHER RESOLVED that Mark Shadowens, Fire Chief of said Board be and hereby is authorized to sign and execute said Agreement and any amendments on behalf of the Northstar Community Services District. PASSED, APPROVED AND ADOPTED this 20 th day of December Jeann Green, Board President ATTEST: James Bowling Secretary of the Board _ I, James Bowling, Secretary of the Board of Directors of the Northstar Community Services District, hereby certify that the foregoing resolution was duly passed at a regular meeting of the Board of Directors of the Northstar Community Services District held on the 20 TH day of December 2017 by the following vote on roll call: Ayes: Noes: Absent: James Bowling, Secretary of the Board

159 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 1 OF 6 DEPARTMENT OF FORESTRY AND FIRE PROTECTION STATE OF CALIFORNIA Natural Resources Agency Agreement for the Volunteer Fire Assistance Program of the Cooperative Forestry Assistance Act of 1978 THIS AGREEMENT, made and entered into ON THE LAST SIGNATORY DATE ON PAGE 6, by and between the STATE of California, acting through the Director of the Department of Forestry and Fire Protection hereinafter called STATE, and RECITALS: hereinafter called LOCAL AGENCY, covenants as follows: 1. STATE has been approved as an agent of the United States Department of Agriculture, (USDA), Forest Service for the purpose of administering the Cooperative Forestry Assistance Act (CFAA) of 1978 (PL , United States Code, Title 16, Chapter 41, Section 2010 et seq., Volunteer Fire Assistance Program), hereinafter referred to as VFA, and 2. The VFA has made funds available to STATE for redistribution, under certain terms and conditions, to LOCAL AGENCY to assist LOCAL AGENCY to upgrade its fire protection capability, and 3. LOCAL AGENCY desires to participate in said VFA. NOW THEREFORE, it is mutually agreed between the parties as follows: 4. APPROVAL: This Agreement is of no force or effect until signed by both parties and approved by the Department of General Services, if required. LOCAL AGENCY may not commence performance until such approval has been obtained. 5. TIMELINESS: Time is of the essence in this Agreement. 6. FORFEITURE OF AWARD: LOCAL AGENCY must return this Agreement and required resolution properly signed and executed to STATE at the address specified in paragraph 11, with a postmark no later than December 29, 2017 or LOCAL AGENCY will forfeit the funds. 7. GRANT AND BUDGET CONTIGENCY CLAUSE: It is mutually understood between the parties that this Agreement may have been written for the mutual benefit of both parties before ascertaining the availability of congressional appropriation of funds, to avoid program and fiscal delays that would occur if the Agreement were executed after that determination was made. VFA Contract (07/2017)

160 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 2 OF 6 This Agreement is valid and enforceable only if sufficient funds are made available to the STATE by the United States Government for the State Fiscal Year 2017 for the purpose of this program. In addition, this Agreement is subject to any additional restrictions, limitations, or conditions enacted by the Congress or to any statute enacted by the Congress that may affect the provisions, terms, or funding of this Agreement in any manner. The parties mutually agree that if the Congress does not appropriate sufficient funds for the program, this Agreement shall be amended to reflect any reduction in funds. The STATE has the option to invalidate the Agreement under the 30-day cancellation clause or to amend the Agreement to reflect any reduction in funds. 8. REIMBURSEMENT: STATE will reimburse LOCAL AGENCY, from funds made available to STATE by the Federal Government, an amount not to exceed $13, on a 50/50 matching funds basis, for the performance of specific projects and/or purchase of specific items identified in Exhibit(s) A, Application for Funding, attached hereto. Reimbursement will be only for those projects accomplished and/or items purchased between THE LAST SIGNATORY DATE ON PAGE 6 and JUNE 30, This sum is the sole and maximum payment that STATE will make pursuant to this Agreement. LOCAL AGENCY must bill STATE at the address specified in paragraph 11, with a postmark no later than September 1, 2018 in order to receive the funds. The bill submitted by LOCAL AGENCY must clearly delineate the projects performed and/or items purchased. A vendor s invoice or proof of payment to vendor(s) must be included for items purchased. 9. LIMITATIONS: Expenditure of the funds distributed by STATE herein is subject to the same limitations as placed by the VFA, upon expenditure of United States Government Funds. Pursuant to Title 7 of the Code of Federal Regulations, Section subject to the obligations and conditions set forth in that section; title to any equipment and supplies acquired under this Agreement vests with the LOCAL AGENCY. For any equipment items over $5,000, the federal government may retain a vested interested in accordance with paragraph 16 below. 10. MATCHING FUNDS: Any and all funds paid to LOCAL AGENCY under the terms of this Agreement, hereinafter referred to as VFA Funds, shall be matched by LOCAL AGENCY on a dollar-for-dollar basis, for each project listed on attachment(s) hereto identified as Exhibit(s) A. No amount of unpaid contributed or volunteer labor or services shall be used or consigned in calculating the matching amount actually spent by LOCAL AGENCY. LOCAL AGENCY shall not use VFA Funds as matching funds for other federal grants, including Department of Interior (USDI) Rural Fire Assistance grants, nor use funds from other federal grants, including USDI Rural Fire Assistance grants, as matching funds for VFA Funds. ADDRESSES: The mailing addresses of the parties hereto, for all notices, billings, payments, repayments, or any other activity under the terms of the Agreement, are: VFA Contract (07/2017)

161 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 3 OF 6 LOCAL AGENCY: Attention: Telephone Number(s): FAX Number: STATE: Department of Forestry and Fire Protection Grants Management Unit, Attn: Megan Esfandiary P. O. Box Sacramento, California PHONE: (916) FAX (916) PURPOSE: Any project to be funded hereunder must be intended to specifically assist LOCAL AGENCY to organize, train, and/or equip local firefighting forces in the aforementioned rural area and community to prevent or suppress fires which threaten life, resources, and/or improvements within the area of operation of LOCAL AGENCY. 13. COMBINING: In the event funds are paid for two or more separate, but closely related projects, the 50/50 cost-sharing formula will be applied to the total cost of such combined projects. 14. OVERRUNS: In the event that the total cost of a funded project exceeds the estimate of costs upon which this Agreement is made, LOCAL AGENCY may request additional funds to cover the Agreement share of the amount exceeded. However, there is no assurance that any such funds are, or may be, available for reimbursement. Any increase in funding will require an amendment. 15. UNDERRUNS: In the event that the total cost of a funded project is less than the estimate of costs upon which this Agreement is made, LOCAL AGENCY may request that additional eligible projects/items be approved by STATE for Agreement funding. However, there is no assurance that any such approval will be funded. Approval of additional projects/items, not listed on the Exhibit A application, made by STATE, will be in writing and will require an amendment. 16. FEDERAL INTEREST IN EQUIPMENT: The Federal Government has a vested interest in any item purchased with VFA funding in excess of $5,000 regardless of the length of this Agreement, until such time as the fair market value is less than $5,000. The VFA percentage used to purchase the equipment will be applied to the sale price and recovered for the Government during the sale. This percentage will remain the same even following depreciation. The Federal Government may not have to be reimbursed if the disposal sale amounts to a fair market value of less than $5,000. LOCAL AGENCY will notify STATE of the disposal of such items. VFA Contract (07/2017)

162 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 4 OF EQUIPMENT INVENTORY: Any single item purchased in excess of $5,000 will be assigned a VFA Property Number by the STATE. LOCAL AGENCY shall forward a copy of the purchase documents listing the item, brand, model, serial number, any LOCAL AGENCY property number assigned, and a LOCAL AGENCY contact and return address to STATE at the address specified in paragraph 11. The STATE will advise the LOCAL AGENCY contact of the VFA Property Number assigned. 18. AUDIT: LOCAL AGENCY agrees that the STATE, the Department of General Services, the Bureau of State Audits, or their designated representative shall have the right to review and to copy any records and supporting documentation pertaining to the performance of this Agreement. LOCAL AGENCY agrees to maintain such records for possible audit for a minimum of three (3) years after final payment, unless a longer period of records retention is stipulated. LOCAL AGENCY agrees to allow the auditor(s) access to such records during normal business hours and to allow interviews of any employees who might reasonably have information related to such records. Further, LOCAL AGENCY agrees to include a similar right of the State of California to audit records and interview staff in any subcontract related to performance of this Agreement. (GC , PCC et seq., CCR Title 2, Section 1896). 19. DISPUTES: In the event of any dispute over qualifying matching expenditures of LOCAL AGENCY, the dispute will be decided by STATE and its decision shall be final and binding. 20. INDEMNIFICATION: LOCAL AGENCY agrees to indemnify, defend, and save harmless, the STATE, its officers, agents, and employees, from any and all claims and losses, accruing or resulting to any and all contractors, subcontractors, suppliers, laborers, and any other person, firm or corporation furnishing or supplying work services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm or corporation who may be injured or damaged by LOCAL AGENCY in the performance of this Agreement. 21. DRUG-FREE WORKPLACE REQUIREMENTS: LOCAL AGENCY will comply with the requirements of the Drug-Free Workplace Act of 1990 and will provide a drug-free workplace by taking the following actions: a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations. b. Establish a Drug-Free Awareness Program to inform employees about: 1) the dangers of drug abuse in the workplace; VFA Contract (07/2017) 2) the person's or organization's policy of maintaining a drug-free workplace;

163 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 5 OF 6 3) any available counseling, rehabilitation and employee assistance programs; and, 4) penalties that may be imposed upon employees for drug abuse violations. c. Every employee who works on the proposed Agreement will: 1) receive a copy of the company's drug-free workplace policy statement; and, 2) agree to abide by the terms of the company's statement as a condition of employment on the Agreement. Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and LOCAL AGENCY may be ineligible for funding of any future State Agreement if the department determines that any of the following has occurred: (1) the LOCAL AGENCY has made false certification, or violated the certification by failing to carry out the requirements as noted above. (GC 8350 et seq.) 22. TERM: The term of the Agreement SHALL COMMENCE ON THE LAST SIGNATORY DATE ON PAGE 6 and continue through June 30, TERMINATION: This Agreement may be terminated by either party giving 30 days written notice to the other party or provisions herein amended upon mutual consent of the parties hereto. 24. AMENDMENTS: No amendment or variation of the terms of this Agreement shall be valid unless made in writing, signed by the parties and approved as required. No oral understanding or Agreement not incorporated in the Agreement is binding on any of the parties. 25. INDEPENDENT CONTRACTOR: LOCAL AGENCY, and the agents and employees of LOCAL AGENCY, in the performance of this Agreement, shall act in an independent capacity and not as officers or employees or agents of the STATE or the Federal Government. VFA Contract (07/2017)

164 7FG17096 VOLUNTEER FIRE ASSISTANCE PROGRAM AGREEMENT PAGE 6 OF 6 IN WITNESS WHEREOF, the parties have executed this Agreement as of the last signatory date below. STATE OF CALIFORNIA DEPARTMENT OF FORESTRY AND FIRE PROTECTION By: Signature Dan Sendek Printed Name Staff Chief Title Cooperative Fire Programs LOCAL AGENCY By: *Signature Printed Name **Title Last Signatory Date ***Date *Ensure that the officer signing here for LOCAL AGENCY IS THE SAME Officer authorized in the Resolution to execute this Agreement. **Ensure that the title entered here IS THE SAME title used in the Resolution for the Officer who is executing this Agreement. ***Ensure that the date LOCAL AGENCY signs IS THE SAME DATE as the Resolution date OR LATER. FOR STATE USE ONLY AMOUNT ENCUMBERED BY THIS DOCUMENT $13, PRIOR AMOUNT ENCUMBERED FOR THIS AGREEMENT $0 TOTAL AMOUNT ENCUMBERED TO DATE $13, PROGRAM/CATEGORY (CODE AND TITLE) Support (OPTIONAL USE) Vendor # ITEM OBJECT OF EXPENDITURE (CODE AND TITLE) I hereby certify upon my own personal knowledge that budgeted funds are available for the period and purpose of the expenditure stated above. SIGNATURE OF CDF ACCOUNTING OFFICER X CHAPTER 14 T.B.A. NO. DATE STATUTE 2017 B.R. NO. FUND TITLE Federal FISCAL YEAR 17/18 Department of General Services Use Only DGS APPROVAL NOT REQUIRED PER SAM 1215 CONTRACTOR STATE AGENCY DEPT. OF GEN. SER. CONTROLLER VFA Contract (07/2017)

165 AGENDA ITEM #16 Directors Report There is no written report for this agenda item.

166 DATE: December 20, 2017 General Manager s Report TO: FROM: District Board Members Mike Staudenmayer, General Manager SUBJECT: General Manager s Report For Information Only The discussion section below provides information from the District s management on its current projects that are not the subject of a separate report. This report is formatted to provide new information and recent progress only. The following is a list of meetings and training seminars attended in the last month: GM Staudenmayer and DFA Rosenthal conducted interviews for Accounting position GM Staudenmayer met with NPOA GM Stephens to discuss community issues GM Staudenmayer, DE Martin and TSS Detwiler attended AWWA s Water Loss conference GM Staudenmayer and DE Martin met with NEPA consultant to discuss final comments on the MVT EA. GM Staudenmayer and Director Ives met with NLTRA CEO, Placer County reps and area special district GMs to discuss Tourism Master Plan funding gap and potential ½ cent sales tax for trails. GM Staudenmayer attended the quarterly Placer County CEO meeting GM Staudenmayer attended the quarterly Truckee area managers meeting. GM Staudenmayer attended a meeting on affordable housing with other area managers. District staff met to discuss the District s Backflow Prevention Program GM Staudenmayer attended a meeting with District and Northstar water attorneys and MBK Engineers to discuss water rights.

167 DISCUSSION: 1. The Placer County Board of Supervisor approved the new committee that will advise on TOT funds for local tourism master plan capital projects. The Capital Projects Advisory Committee, approved unanimously on December 13 th by the county Board of Supervisors, will be co-chaired by Placer County and the North Lake Tahoe Resort Association and comprised of 13 members representing the range of community interests in project investments in eastern Placer County. This committee replaces the former Capital Investment and Transportation committee which I sat on for a number of years. The new structure includes representation from two special districts. See attached press release and graphic depicting the committee make up and structure. 2. The AWWA Water Loss conference was well attended by over 600 members from across the country. Although the District has a very progressive customer-side leak detection program, little has been addressed with respect to non-revenue water and distribution losses. Rough calculations indicate that these losses are below industry norms however more formal water auditing and program element development and implementation are good practice. Technical staff will perform a water audit to quantify a baseline loss index. District Metered Areas (DMAs) will be pursued to expose potential water loss on distribution infrastructure for more focused resolution. Pressure reduction, billing audits, meter bench testing and other apparent loss measures will also be pursued to minimize water and revenue loss. ATTACHMENTS: Placer County press release on new capital committee and structure figure. DATE PREPARED: December 15,

168 Placer approves new committee to recommend projects for lodging tax funding in eastern Placer County December 13, 2017 Lodging taxes collected from overnight guests in eastern Placer County have long been allocated for local, visitor-serving projects to benefit its tourism-based economy. Now a new committee will provide broader community input about which projects the county approves for funding. The Capital Projects Advisory Committee, approved unanimously today by the county Board of Supervisors, will be co-chaired by Placer County and the North Lake Tahoe Resort Association and comprised of 13 members representing the range of community interests in project investments in eastern Placer County. The approval follows months of outreach by Placer County and NLTRA to increase community involvement in how project investments are made. "I'm really thankful to county staff and the North Lake Tahoe Resort Association for working so diligently on this and expanding the footprint of this committee, both geographically and in terms of interests," said Board Chairwoman and District 5 Supervisor Jennifer Montgomery. Representing the full range of our eastern Placer County residents and businesses is so important for making sure our future investments benefit everyone in our community. Members of the new committee will be appointed by their represented organizations. Area business associations, special districts, the NLTRA and Placer County will each appoint two members, and two atlarge members will be appointed jointly by Placer County and NLTRA. Three members will represent lodging providers, the Truckee North Tahoe Transportation Management Agency and Placer s ski resorts. Terms for most members will be two years, with at-large members appointed for an initial three-year term and two-year terms to follow. The committee will be responsible for recommending priorities for Placer County s Tourism Master Plan and reviewing and recommending project applications for lodging tax funding to the Board of Supervisors for approval. They ll also hold public meetings to review proposed projects and continually seek feedback from the community on investment priorities. Last year, Placer County collected about $18 million in guest lodging taxes in eastern Placer County. With recent efforts succeeding in increasing compliance with the county s lodging tax ordinance, even more funding is expected to be available for local projects in the future. In three community meetings in early November, the county and NLTRA sought input from local residents on the best way to spend lodging tax revenue on projects and services to improve quality of life and the visitor experience, as well as the structure of the new advisory committee. The committee makeup reflects strong interest from the community in broad geographic and industry representation. Our board is in full support of this new committee, said Cindy Gustafson, CEO of the North Lake Tahoe 3

169 Resort Association. On behalf of the board, I d like to thank Placer County for their partnership and their continued investment in the future of North Lake Tahoe. Representatives of the Donner Summit Area Association and the Tahoe City Downtown Association also spoke in support of the committee during the meeting. With today s approval, committee members will be appointed over the coming weeks, and appointments will be brought before the Board of Supervisors in February The committee will review project applications for the next fiscal year in March, with consideration of the committee s recommendations by the Board of Supervisors to follow. Since 1996, Placer County has partnered with NLTRA to market North Lake Tahoe and recommend how to prioritize transportation and infrastructure goals outlined in the county s Tourism Master Plan. In recent months, county staff based in North Lake Tahoe and the NLTRA hosted a number of community meetings and workshops to seek feedback on how the county and NLTRA can include broader community perspective in prioritizing infrastructure and transportation projects in the region. Previously, review and recommendation of local projects to the Board of Supervisors were the responsibility of NLTRA s Capital Infrastructure and Transportation Committee, under its contract with Placer County. 4

170 PROPOSED CAPITAL PROJECTS ADVISORY COMMITTEE PROPOSED CAPITAL PROJECTS ADVISORY COMMITTEE Co-chaired by Placer County and the North Lake Tahoe Resort Association Representation Initial Term Appointed By 1 Business Associations 2 years Business Associations 2 Business Associations 2 years Business Associations 3 Special Districts/PUDs 2 years Special Districts 4 Special Districts/PUDs 2 years Special Districts 5 Resort Association 2 years Resort Association 6 Resort Association 2 years Resort Association 7 County appointed 2 years Placer County 8 County appointed 2 years Placer County 9 Transportation 2 years TNT-TMA 10 Ski Resorts 3 years Ski Resorts 11 Lodging 3 years Placer County and Resort Association 12 At Large: housing, social service, arts and culture 3 years Placer County and Resort Association 13 At Large: housing, social service, arts and culture 3 years Placer County and Resort Association RECOMMENDS PROJECTS & PROGRAMS ALLOCATES TOT REVENUE FOR PROJECTS AND SERVICES IN EASTERN PLACER COUNTY BOS (Placer County Board of Supervisors) BUSINESS ASSOCIATIONS: Donner Summit Association North Tahoe Business Association Tahoe City Downtown Association SPECIAL DISTRICTS: Northstar Community Services District North Tahoe Public Utility District Squaw Valley Public Services District Tahoe City Public Utility District Truckee Tahoe Airport District SKI RESORTS: Homewood Northstar Squaw/Alpine Sugar Bowl SIDEBOARDS: Preference for one representative per organization Appointing organization must provide service in Placer County and implement Tourism Master Plan priorities Appointees may include board, staff or community members

171 DATE: December 20, 2017 NORTHSTAR COMMUNITY SERVICES DISTRICT District Fire Chief s Report TO: FROM: District Board Members Mark Shadowens, Fire Chief SUBJECT: Fire Chief s Report For Information Only BACKGROUND: The section below provides information from the Fire Department on its current projects that are not the subject of a separate report. This report is formatted to provide new information and recent progress only. Chief Shadowens attended a seminar of the Lake Tahoe Regional Fire Chiefs Association. Captain Coleman and Engineer Bahr took a one day trip to Las Vegas to meet with the vendor of the fire truck refurbishment company. The purpose of the trip was to discuss the details of the refurbishment now that they had the apparatus at their facility. They also went over the inspection list that the company had done once the apparatus arrived at their facility. Chief Shadowens held a meeting with the Placer County Sheriff s and Vail Resorts to discuss some of the logistics that come with responding to medical calls on the ski hill. Ritz Carlton provided a Thanksgiving dinner for the on-duty staff and their families. Chief Shadowens attended a meeting of the Fire Agencies Insurance Risk Authority in San Francisco. Chief Shadowens, staff, and some of the past retires from the organization took part in a plaque dedication to honor past employees who have now passed away.