HomeMy WebLinkAbout2018 ACFR
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
CITY OF PASCO, WASHINGTON
FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2018
Prepared by:
Finance Department
Richa Sigdel-Director
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TABLE OF CONTENTS
INTRODUCTORY SECTION
Letter of Transmittal ……………………………………………………………………………….. 1
Organizational Chart ………………………………………………………………………………. 8
Directory of City Officials and Leadership Team………………………………………………….. 9
FINANCIAL SECTION
Independent Auditor’s Report ………………………………………………………………...…… 11
Management’s Discussion and Analysis ………………………………………………………….. 15
Basic Financial Statements
Government Wide Financial Statements
Statement of Net Position…………………………………………............................................ 26
Statement of Activities…………………………………………………………………………. 27
Fund Financial Statements
Balance Sheet – Governmental Funds ......................................................................................... 28
Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds.. 29
Reconciliation of Statement of Revenues, Expenditures and Changes in Fund Balance of
Governmental Funds to the Statement of Net Activities.……..…………….…………..…… 30
Statement of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual-
General Fund…………………………………………………………………………………. 31
Statement of Net Position - Proprietary Fund…………………….…………………………….. 32
Statement of Revenues, Expenses and Changes in Net Position – Proprietary Funds………….. 33
Statement of Cash Flows – Proprietary Fund ………………………………………………….. 34
Statement of Net Position – Fiduciary Funds…………………………………………………… 35
Statement of Changes in Net Position – Fiduciary Funds.………………………………..……… 35
Notes to the Financial Statements….…………………….…………………………….………… 37
Required Supplementary Information
Schedule of Changes in Net OPEB Liability and Related Ratios - Firemen’s OPEB Plan . ….. 92
Schedule of Investment Returns – Fireman’s OPEB Plan.. ……………………………………. 93
Schedule of City Contributions - LEOFF 1 OPEB …………….…..…………………………. 93
Schedule of Changes in Net OPEB Liability – LEOFF 1 OPEB ……………………………… 93
Schedule of Changes in Net Pension Liability and Related Ratios – Fire Pension Plan ....……. 94
Schedule of Employer Contributions – Fire Pension Plan …………………………….………. 94
Schedule of Investment Returns – Fire Pension Plan …………………………………………. 94
Schedule of Proportionate Share of the Net Pension Liability - All State Plans…………….… 95
Schedule of Emplo yer Contributions - All State Plans………………………………………... 96
Combining and Individual Fund Statements
Combining Balance Sheet – Nonmajor Other Governmental Funds ………………………….. 98
Combining Statement of Revenues, Expenditures and Changes in Fund Balance-
Nonmajor Other Governmental Funds ……………………………………………………….. 99
Combining Balance Sheet – Nonmajor Special Revenue Funds …………………………….. 100
Combining Statement of Revenues, Expenditures and Changes in Fund Balance-
Nonmajor Special Revenue Funds……………………………………………………………. 105
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Combining Balance Sheet – Nonmajor Debt Service Funds…….…………………………….. 110
Combining Statement of Revenues, Expenditures and Changes in Fund Balance-
Nonmajor Debt Service Funds…………………………………………………………….... 111
TABLE OF CONTENTS (continued)
Statement of Revenues, Expenditures and Changes in Fund Balance – Budget to Actual
Major Construction Fund.…………………….……………………………………………… 112
Schedule of Revenues and Expenditures–Budget to Actual–Nonmajor Other Governmental
Funds ……………………………………………………………………………………….. 113
Combining Statement of Net Position – Nonmajor Internal Service Funds…………………… 116
Combining Statement of Revenues, Expenses, and Changes in Net Position –
Nonmajor Internal Service Funds…..………..……………………………………………… 117
Combining Statement of Cash Flows – Nonmajor Internal Service Funds................................ 118
Combining Statement of Net Position– Fiduciary Funds……………………………..………. 120
Combining Statement Assets and Liabilities – Agency Funds………………………………… 121
Combining Statement of Changes in Net Position – Fiduciary Funds…...…………..……….. 122
Combining Statement of Changes in Net Position – Agency Funds…...…………..……….. 123
STATISTICAL SECTION
Financial Trends
Net Position by Component……………………............................................................................ 126
Changes in Net Position……….................................................................................................... 127
Governmental Activities Tax Revenues by Source…………………..………..………………… 129
Fund Balances of Governmental Funds………………….............................................................. 130
Changes in Fund Balances of Governmental Funds…………………........................................... 131
Revenue Capacity
Assessed Value of Taxable Property .......................................................................................... 132
B&O Taxes by Type ……………………................................................................................... 132
Property Tax Rates ....................................................................................................................... 133
Taxable Retail Sales ………………………………..……………………................................... 133
Principal Property Taxpayers…………………………….………………................................... 134
Principal B&O Taxpayers …………………………….…………………..............……………. 134
Top Ten Industries that Generate Sales Tax…………………………………………………….. 135
Property Tax Levies and Collections…………………................................................................. 135
Debt Capacity
Ratios of Outstanding Debt by Type/Ratio of General Bonded Debt Outstanding....................... 136
Legal Debt Margin……………………………............................................................................. 138
Direct and Overlapping Governmental Activities Debt……………………………………...... 139
Waterworks Utility Debt Service Coverage……........................................................................... 140
Demographic and Economic Information
Demographic and Economic Statistics.......................................................................................... 141
Principal Employers…………………………………………...................................................... 142
Non Agriculture Wage and Salary Workers…………………………………………………….. 143
Building Permits………………………………………………………………………………… 143
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Operating Information
Full Time Equivalent City Government Employees by Function…………………………........ 144
Operating Indicators by Function………………………………………………………………. 145
Building Permits………………………………………………………………………………… 146
Capital used by Function……………………………………………………………………….. 147
Waterworks Utility Customers …………………………………..…..…………………………. 148
Waterworks Utility Rates………………………………………………….……………………. 149
STATE REQUIRED SCHEDULES
Schedule 9 – Schedule of Long-Term Liabilities……………………………….………..……… 152
Schedule 15 – Schedule of State Financial Assistance…………………………………..………….. 153
Schedule 16 – Schedule of Expenditures of Federal Awards……………………………………….. 154
Notes to Schedule of Expenditures of Federal Awards……………………………..…………. ….. 155
Schedule 17 – Limitation on Public Works Projects performed by employees…………………… 156
Schedule 19 - Labor Relations Consultants………………………………………………………… 157
Schedule 21 – Local Government Risk Assumption………………………………………………. 158
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City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Honorable Mayor, Members of the City Council, Pasco Community Members and interested
parties,
We are pleased to submit the Comprehensive Annual Financial Report (CAFR) of the City of
Pasco for the year ending December 31, 2018. State statute and debt covenants require the City
to issue an audited CAFR annually.
This report consists of management’s representation concerning the finances of the City of Pasco.
Consequently, management assumes full responsibility for the completeness and reliability of the
information within the report. In order to provide a basis for making these representations,
management has established a comprehensive internal control framework designed to protect the
government’s assets from loss, theft or misuse and to compile reliable information for the
preparation of the City’s Financial Statements in conformity with Generally Accepted
Accounting Practices (GAAP). Because the cost of internal controls should not outweigh the
benefits, the City of Pasco’s comprehensive framework of internal controls has been designed to
provide reasonable rather than absolute assurance that the Financial Statements will be free from
material misstatement. As management, we assert that, to the best of our knowledge and belief,
this Financial Report is complete and reliable in all material respects.
The City’s Financial Statements have been audited by the State’s Auditor’s Office (SAO). The
goal of the SAO audit is to provide reasonable third-party assurance that the financial statements
of the City for the fiscal year ended December 31, 2017 are free of material misstatements. City’s
Financial Report contained one misclassification of an expense. The misclassification did not
result in over or under statement of expenses, but simply categorization in a manner different
than prescribed by SAO. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements; assessing the accounting
principles used and significant estimates made by management; and evaluating the overall
financial statement presentation. With exception of the misclassification of expense, the
independent auditor concluded, based upon the audit, that there was a reasonable basis for
rendering an unqualified opinion that the City’s financial statements for the fiscal year ending
December 31, 2017 are fairly presented in conformity with GAAP.
In addition to the independent financial statement audit for the year ending December 31, 2017,
the City underwent a Single Audit. This is mandated for agencies expending federal grant funds
in excess of $500,000 during the year, which the City did. The standards governing Single Audit
engagements require the independent auditor to report not only on the fair presentation of the
financial statements but also on the audited government’s internal controls and compliance with
legal requirements with special emphasis on internal controls and legal requirements involving
the administration of federal awards.
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GAAP requires that management provide a narrative introduction, overview and analysis to
accompany the basic financial statements in the form of Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it. The City of Pasco’s MD&A can be found immediately following the report
of the independent auditors.
PROFILE OF THE CITY OF PASCO
The City of Pasco is located in Franklin County, in south-central Washington. This area is also
known as the Mid-Columbia region of the Pacific Northwest. The City encompasses
approximately 34 square miles, serves as the Franklin County seat, and is the largest City in the
County. Pasco and the neighboring cities of Richland, Kennewick and surrounding area, which
are located in Benton County, make up the Tri-Cities Metropolitan Area, the fourth largest urban
area in Washington State.
Pasco has experienced rapid residential growth in the 21st century, growing from a population of
32,066 in 2000 to an estimated 73,590 in 2018. The City is projected to exceed a population of
over 124,000 in the next 20 years, and is rated among the best places to invest, live, and seek
employment.
Initially established in 1884, the City was incorporated in 1891 and has operated under state laws
applicable to a code city with a Council/Manager form of government since May 5, 1964. The
City Manager is appointed by the City Council and is responsible to the City Council for the
proper administration of all City operations. Historically, the City Council was made up of five
council seats decided by district in the primary election but “at-large” in the general election, and
two “at-large” seats which were voted on in a City-wide vote in both the primary and general
election. Due to rapid population growth, the voting district boundaries have been changed
several times over the past two decades. The City’s demographic characteristics have also
changed. In 2015, the City Council pursued a change to a district-based election system in both
primary and general elections; however, during the 2015 and 2016 legislative sessions, the State
Legislature failed to pass legislation allowing such a change to occur. In the interim, the
American Civil Liberties Union (ACLU) filed a complaint for an alleged violation to the federal
Voting Rights Act. The City and the ACLU jointly proposed to pursue a remedy through a
Consent Order to the United States District Court for the Eastern District of Washington State to
allow for the change to district-based voting in the general election. While similar, the City and
ACLU proposals differed slightly. On January 27, 2017, a Senior Federal District Court Judge,
the Honorable Lonny Suko, found that the City’s proposed plan of six voting districts with one
“at large” position met the requirements of the federal Voting Rights Act and ordered the change,
including that all seven seats stand for election in 2017. The City Council is comprised of seven
members, six elected by district, one elected at-large, with one of the seven selected by the
members to serve as Mayor for a two-year term. Council members are part-time elected officials
who exercise legislative authority and determine matters of policy for the City.
The City is a general-purpose government and provides the full range of municipal services
authorized by State law. These services include police and fire protection, ambulance service,
parks and recreation activities, street maintenance and construction, current and long-range
planning and zoning, and general administrative services. The City owns and operates a
water/sewer system, a cemetery and a championship golf course. The City also owns a baseball
stadium that is leased to an independent operator.
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The City of Pasco maintains budgetary controls to ensure compliance with legal provisions
embodied in the budget. All activities are appropriated through the budget process and published
in the City’s Budget document. The City Council must adopt an ordinance to increase or decrease
total appropriations in a Fund.
LOCAL ECONOMY
The Tri-Cities is the fastest growing community in the state of Washington. The current
population estimate is 296,000, making it the 164th largest market in the United States and eighth
largest in the Pacific Northwest. The population of Franklin County, where Pasco resides in
accounts for 94,300 of the total Tri-Cities area population. A once small, quiet Central
Washington town on the banks of the Columbia, Pasco has experienced rapid growth over a
prolonged period of time that has transformed the City into a dynamic and vibrant community of
over 73,500 people; well within the top 20 most populated cities in the State. The Pasco of today
is a regional hub of commerce with a diverse population, and quickly rising education levels and
household incomes. The City’s economy is largely based on agriculture and related food
processing, manufacturing, retail, and transportation.
The region’s economy is anchored in agribusiness, food processing, manufacturing, research and
development, specialized services, production technology, government, and healthcare.
Agribusiness
Our area produces bountiful harvests with a rich variety of crops. Climate, soil, experience, and
sophisticated technology all contribute to this outcome. We are among the most important
production centers for tree fruit, wine grapes, sweet corn, potatoes and hay in the state. Franklin
County has over 625,000 acres in farmed land and was ranked 48th in the country in market value
of products sold in 2012, amounting to $740,000,000. With easy access to diverse and high
quality products, supporting infrastructure, and a robust transportation network, food processing
has become a major factor in the area’s economy.
The Process Water Reuse Facility (PWRF), facility specifically designed for the food processing
industry, was constructed in 1995. The facility provides food processors the unique advantage of
handling wastewater disposal via the City’s industrial wastewater system rather than the general
sewer system. The Center was developed jointly by the City, Port of Pasco and Franklin County
Public Utility District. This system pumps the wastewater into huge storage ponds, where it is
treated and then used to irrigate crops. These storage ponds allow processors to operate year
round. Since completion, the operation has expanded to include several large food processors
such as J.R Simplot, Pasco Processing, Reser’s Fine Foods, Twin City Foods, and Freeze Pack.
Grimmway Farms, a global produce leader and the world’s largest producer of carrots resides in
Pasco and employs over 200 workers. Due to high growth and demand, the City is in the process
of completing a Facility Plan to modernize and expand the current facility to meet the demands
of current and future processors. Americold constructed an $8 million freezing facility,
complementing the existing industry within the City. Food processing and storage companies
employ an estimated 1,000 employees, with additional employees during peak seasons.
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Syngenta, a seed processing facility that serves its global market employs 100 workers. The other
major food processor in the area, Lamb Weston, operates a French fry processing plant just north
of the City limits employing about 700 workers.
Government
A major catalyst for the growth of the Tri-Cities in the 1970’s was the expansion of the Hanford
Nuclear Reservation, which has evolved into one of the largest nuclear industrial centers in the
United States. Located in Benton County, the Hanford Reservation encompasses approximately
560 square miles and contains various nuclear and nuclear-related projects, serving as a national
energy resource center. Today, the focus is on energy research, environmental remediation/waste
management and related technology. A 40-year Tri-Party Agreement was signed by the U.S.
Department of Energy, the State and the U.S. Environmental Protection Agency, which
established a plan to “cleanup” the environment of the Hanford Reservation. The overall plan is
intended to improve radioactive and chemical waste disposal and to manage future waste
generated at the site. The Department of Energy’s Pacific Northwest National Laboratory, located
in Richland, is only one of ten such facilities. Its focus is on using science and technology to
meet national priorities. It has teamed with several local economic development partners to
develop and market the region’s first technology-based research area known as the Tri-Cities
Research District. Currently, the 2,875 - acre District’s 80+ tenants employ more than 7,000
people.
Tourism
The community has diligently focused on diversifying its economic portfolio, including a
commitment to tourism. In 1994, a professional minor league baseball stadium was built. The
stadium seats 4,000 and includes a parking lot for 1,000 automobiles. The stadium is currently
leased to Northwest Baseball Ventures I, LLC, owners of the Tri-City Dust Devils, and a single
A affiliate of the San Diego Padres of Major League Baseball team.
In 1995, The HAPO Center, formerly called the TRAC, was built through a joint venture between
the City of Pasco and Franklin County. The HAPO Center includes a rodeo and livestock arena,
exhibition hall, meeting rooms, a concession area, and administrative offices. Additionally, an
adjoining 15-field soccer complex occupying 45 acres was developed in 1995. The complex is
the state’s second largest and has become a popular location for tournament play. In 2000, the
City completed construction of a $3.5 million six field softball complex in the TRAC area. The
push for tourism has been fueled by the growing popularity of Columbia Valley region wines.
Washington State has a robust $4.8 billion wine industry, ranking it second nationally for
premium wine production. Known as the “Heart of Washington Wine Country”, Columbia
Valley region is home to over 200 wineries within a 60-mile radius, with 50,000 acres of
vineyards, making it bigger in area than Napa Valley. Visitors are coming to the region from all
over the country and world to enjoy premium wines, food, and weather. To meet the growing
demand, the City continues to see growth in hospitality industry, with a new 99-room Courtyard
by Marriott hotel in construction adjacent to the airport.
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Healthcare
Lourdes Health Network is located in Pasco and is the third largest employer in Franklin County,
with over 800 employees. In 2016, the Hospital celebrated 100 years of responding to the
healthcare needs of the community. It now has 10 locations housing 24 physician and specialty
clinics. Lourdes Counseling Center is the largest and only inpatient and outpatient behavioral
health service provider in Southeastern Washington.
Kadlec, a regional medical center serving the community since 1944, also serves the region. It is
the second largest employer in the Tri-Cities area, employee over 3,500 workers.
Trios Health, formerly known as Kennewick General Hospital, first started in 1952 as a
community driven effort to establish a Kennewick-based hospital. The organization operates two
teaching hospitals and a network of outpatient specialty practices and services, employing more
than 1,200 workers. RCCH Healthcare Partners now manages Trios Health, as well as Lourdes
Health Network.
Transportation and Other
In 2016, AutoZone Inc., a Fortune 500 company, announced plans to build a 443,819 square-foot
distribution center and truck maintenance yard in Pasco. The facility was operational in 2017,
and employs 320 workers.
Pasco is also the home of the region’s only international airport, train and bus depots. Tri-Cities
Airport is regional airport served by several airlines, with direct flights to nine major US cities:
Denver, Las Vegas, Los Angeles, Mesa, Minneapolis, Salt Lake City, San Francisco, and Seattle.
The local Amtrak station and a Greyhound Bus Station is located in Pasco, connecting the City
to the rest of the country. Additional commercial transportation is also accomplished through
extensive barge traffic on the Columbia and Snake rivers. Rail transport is provided by the BNSF
Railway. The Trucking industry uses Interstate 182, and to a lesser extent U.S. Route 395.
SUMMARY OF CURRENT AND FUTURE ECONOMIC OUTLOOK
The Benton-Franklin County area has experienced rapid and sustained growth which has
outdistanced the growth rates of both Washington State and the United States. This region’s
average growth since the 2010 Census has remained level at 1.8% per annum. Washington State’s
and the United States’ an average growth of 1.3% and 0.7%, respectively, have not kept pace.
The trend for this region appears to remain on track with a 2018 growth rate of 2.2%. Pasco is
the fastest growing City within the region, with an average growth of 3% since the 2010 Census.
The growth trend for Pasco also remains on track, with a 2018 growth rate of 2.7%. The Office
of Financial Management anticipates the City to add 50,000 new residents by 2040.
In 2018, the Pasco economy was stable and continued to grow. The City issued 2,686 building
permits representing approximately $220 million in construction value. Of the total permits, 485
were for new single-family residences, which equates to $128 million in construction value. The
average value of a new home in Pasco was approximately $270,000 in 2018. This is a 28%
increase in home value compared to $210,000 in 2010. This growing economy was reflected in
Standard & Poor’s rating the City’s 2017 Utility and the 2015 General Obligation bond issue as
AA-/Stable.
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Businesses have continued making a significant investment in Pasco through their new or
existing infrastructure. Aforementioned Courtyard at Marriot, valued at $8,500,000 is under
construction. Pasco School District Elementary School, valued at $13,000,000 is also under
construction in 2018. Furthermore, a variety of commercial and industrial construction like new
hangar, offices, and retail spaces. In total, the City received more than $76 million investment
in construction for commercial and industrial purposes. Last year, City saw permitting and
construction of a large rental storage, Great Harvest, and Bleyhl, with $11,000,000 in value in
the Chapel Hill area, as well as, a multi-family complex in the East Ainsworth area valued at
$5,000,000.
Pasco School District, which serves the majority of the residents within the City of Pasco, has
been growing rapidly to accommodate the growth in population. In 2014, the Pasco School
District completed Franklin STEM (Science, Technology, Engineering, and Math) Elementary
School, at a cost of $9,500,000. In 2015, construction was completed on three schools: Marie
Curie STEM Elementary School and McClintock STEM Elementary School, both at a cost of
$20,000,000. Additionally, Delta High School, a STEM school serving Pasco, Kennewick and
Richland was constructed in Pasco, at a cost of $7,500,000. In 2017, voters approved a
$99,500,000 bond to expand a middle school, add two elementary schools and a middle school
and other safety projects. The heavy investment in school infrastructure is indicative of the
growth Pasco has sustained and looks to continue, as well as the area’s commitment to providing
a well-educated and technologically adept workforce capable of meeting the future needs of
regional, national, as well as international employers. The School District is the largest employer
in the City with over 2,500 employees.
The City is also home to Columbia Basin College, which provides two-year and four-year
degrees to students in the region. The college held its first classes in 1955, and from the initial
enrollment of 272 students to more than 6,800 students today, it continues to meet the higher
education needs of the community. Reflecting its growth, popularity, and demand, it started the
operation of a student housing building, which will provide 45 units to house 125 students; with
the goal of building 375 single, double, and quad units in the future. In 2018, the college was the
fourth largest employer in Franklin County with over 700 employees.
City is also working with landowners on developing the Broadmoor area, a location central to
the Tri-Cities region and a blank space ready for development. The City will complete the project
extending sewer services to the area in the summer of 2019 and is in the process of completing
the environmental review process as well. The development plan envisions the area to include
homes, condominiums, offices, stores, and walking trails to connect them all. The City expects
significant economic development activity in this area in the near future.
ACKNOWLEDGMENTS
The preparation of this report would not have been possible without the efficient and dedicated
service of the entire Finance Department, as well as the cooperation and assistance provided by
other divisions and departments. We would like to express our appreciation to all those who
assisted and contributed to the preparation of this report.
In closing, we would like to thank the members of the City Council for their leadership and
support in planning and conducting the financial affairs of the City in a responsible and
progressive manner.
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Respectfully submitted,
David Zabell, City Manager
Richa Sigdel, Finance Director
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CITY OF PASCO
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Office of the Washington State Auditor
Pat McCarthy
INDEPENDENT AUDITOR’S REPORT ON FINANCIA L STATEMENTS
July 30, 2019
Mayor and City Council
City of Pasco
Pasco, Washington
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund and the aggregate discretely presented component units
and remaining fund information of the City of Pasco, as of and for the year ended December 31,
2018, and the related notes to the financial statements, which collectively comprise the City’s
basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Stateme nts
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. Those standards require that
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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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 City’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 City’s internal control. Accordingly,
we express no such opinion. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinions.
Opini on
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund and the aggregate discretely presented component units and remaining fund
information of the City of Pasco, as of December 31, 2018, and the respective changes in
financial position and, where applicable, cash flows thereof, and the budgetary comparison for
the General fund for the year then ended in accordance 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 and required supplementary information listed in the table
of contents be presented to supplement the basic financial statements. Such information,
although not a part of the basic financial statements, is required by the Governmental Accounting
Standards Board who considers it to be an essential part of financial reporting for placing the
basic financial statements in an appropriate operational, economic or historical context. We have
applied certain limited procedures to the required supplementary information in accordance with
auditing standards generally accepted in the United States of America, which consisted of
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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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.
Supplementary and Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City’s basic financial statements. The combining and individual fund
statements are presented for the purposes of additional analysis and is not a required part of the
basic financial statements. Such information is the responsibility of management and was
derived from and relates directly to the underlying accounting and other records used to prepare
the financial statements. This information has been subjected to 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 financial statements or to the financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of
America. In our opinion, the information is fairly stated, in all material respects, in relation to
the basic financial statements taken as a whole.
Our audit was conducted for the sole purpose of forming opinions on the financial statements
that collectively comprise the City’s basic financial statements as a whole. The Introductory,
Statistical and State Required Schedules sections are presented for purposes of additional
analysis and are not a required part of the basic financial statements of the City. Such information
has not been subjected to the auditing procedures applied in the audit of the basic financial
statements and, accordingly, we do not express an opinion or provide any assurance on it.
OTHER REPORTING REQUIRED BY GOVERNMENT AUDITING
STANDARDS
In accordance with Government Auditing Standards, we will also issue our report dated July 30,
2019, on our consideration of the City’s internal control over financial reporting and on our tests
of its compliance with certain provisions of laws, regulations, contracts and grant agreements
and other matters. That report will be issued under separate cover in the City’s Single Audit
Report. 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
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an audit performed in accordance with Government Auditing Standards in considering the City’s
internal control over financial reporting and compliance.
Sincerely,
Pat McCarthy
State Auditor
Olympia, WA
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MANAGEMENTS’ DISCUSSION AND ANALYSIS
As management of the City of Pasco, we offer readers of the financial statements this narrative
overview and analysis of the financial activities of the City of Pasco for the fiscal year ended
December 31, 2018. We encourage readers to consider the information that we have furnished in
our letter of transmittal which can be found starting on page 1 of this report. All amounts, unless
otherwise indicated, are expressed in millions of dollars.
Financial Highlights
The assets and deferred inflows of the City of Pasco exceeded liabilities and deferred
outflows at the close of the most recent fiscal year by $455.80. Of this amount, $71.59
may be used to meet the government’s ongoing obligations to the citizens and creditors.
The City of Pasco’s total net position improved by $41.26. Approximately 71% of the
increase in net position is due to increases in governmental-type activities and 29% is due
to business-type activities. Significant portion of the increase is attributable to capital
grants and contributions received from developers in the form of donated infrastructure.
As of the close of the current fiscal year, the City of Pasco’s governmental funds reported
combined ending fund balances of $40.43, an increase of $3.96 in comparison with the
prior year.
At the end of the current fiscal year, the unrestricted, unassigned fund balance for the
City’s General Fund was $15.36, which also represents 33% of total General Fund
expenditures. There was an excess of revenues over expenditures of $2.76; transfers out
totaling $0.92. Of the transfers out, $0.20 was for one-time expenditures (to cover
construction project capital spending) and $0.72 for cash flow and other subsidies to
Special Revenue funds.
Overview of the Financial Statements
This discussion and analysis are intended to serve as an introduction to the City of Pasco’s basic
financial statements. Those financial statements comprise three components: 1) government-
wide financial statements, 2) fund financial statements, and 3) notes to the financial statements.
This report also contains other supplementary information in addition to the basic financial
statements themselves.
Government-wide Financial statements. The government-wide financial statements are
designed to provide readers with a broad overview of the City of Pasco’s finances in a manner
similar to a private-sector business. The Statement of Net Position presents information on all of
the City of Pasco’s assets and liabilities with the difference bet ween 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 City of Pasco is improving or deteriorating.
The statement of activities presents information showing how the government’s net position
changed during the most recent fiscal year. All changes in net position are reported as soon as
the underlying event giving rise to the change occurs, regardless of the timing of related cash
flows. Thus, revenues and expenses are reported in this statement for some items that will only
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
16
result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused vacation
leave).
The government-wide financial statements distinguish functions of the City of Pasco that are
principally supported by taxes and intergovernmental revenues (Governmental Activities) from
activities that are supported by fees and charges (Business-Type Activities). The governmental
activities of the City of Pasco include general government, public safety, utilities and
environment, transportation, economic environment, and culture and recreation. The business -
type activities of the City of Pasco include water/sewer (which cover water, sewer, irrigation,
process-reuse and storm water activities), equipment maintenance and equipment replacement
services.
The government-wide financial statements can be found on pages 26-27 of this report.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated for specific activities or objectives. The City
of Pasco, like other state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements. All of the funds of the City of Pasco can be
divided into three categories: governmental funds, proprietary funds, and fiduciary funds.
Governmental 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 fund 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. Such information may be
useful in evaluating a government’s near-term financing requirements.
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 statements. By doing
so, readers may better understand the long-term impact of the government’s near-term financing
decisions. Both the governmental fund balance sheet and the governmental fund statements of
revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
The City of Pasco maintains thirty-one individual governmental funds including the general fund.
Information is presented separately in the governmental fund balance sheet and in the
governmental fund statement of revenues, expenditures and changes in fund balances for the
general fund, which is a major fund as defined by the Governmental Accounting Standards
Board. In 2018, the General Fund and the Construction Fund were the only major governmental
funds. Data from the other funds are combined into a single, aggregate presentation. Individual
fund data for each of these non-major governmental funds is provided in the form of Combining
Statements elsewhere in this report.
The City of Pasco adopts an annual appropriated budget for its General Fun d. A budgetary
comparison statement has been provided for the General Fund to demonstrate compliance with
this budget.
The basic governmental fund financial statements can be found starting on page 28 of this report.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
17
Proprietary Funds. The City of Pasco maintains two different types of proprietary funds.
Enterprise funds are used to report the same functions presented as business-type activities in the
government-wide financial statements. The City of Pasco uses an enterprise fund to account for
the water/sewer utility. An Internal service fund is an accounting device used to accumulate and
allocate costs internally to the City of Pasco’s various functions. The City of Pasco uses internal
service funds to account for its equipment maintenance and replacement, central stores and
medical/dental insurance. As the central stores, medical/dental insurance and certain equipment
maintenance and replacement services predominately benefit governmental rather than business-
type functions, they have been included with governmental activities in the government-wide
financial statements.
Proprietary funds provide the same type of information as the government-wide financial
statements, only in more detail. The enterprise fund financial statements provide separate
information for the water/sewer fund. Data from the other two internal service funds (equipment
maintenance and equipment replacement of utility equipment) are combined into a single,
aggregated presentation in the basic proprietary fund financial statements starting on page 32.
Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties
outside the government. Generally Fiduciary funds are not reflected in the government-wide
financial statements because the resources of those funds are not available to support the City of
Pasco’s own programs. However, with the implementation of GASB Statement 68, Accounting
and Financial Reporting for Pensions, and GASB Statement 74, Financial Reporting For
Postemployment Benefit Plans Other Than Pension Plans, the City is required to include net
Pension and OPEB Liabilities and Assets and the related Deferred Inflows and Outflows of
Resources of the Fiduciary Funds in the Government Wide Statements. The accounting used for
the fiduciary funds is much like that used for enterprise funds except for agency funds which
only show assets and liabilities. The basic fiduciary fund financial statements can be found
starting on page 35 of this report.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data
provided in the government-wide and fund financial statements. The notes to the financial
statements can be found starting on page 37.
Government-wide Overall Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government’s
financial position. In the case of the City of Pasco, assets and deferred inflows exceeded liabilities
and deferred outflows by $455.80 at the close of the most recent fiscal year. The largest portion
of the City of Pasco’s net position $384.21 (84%) reflects its investment in capital assets (e.g.
buildings, machinery, equipment, infrastructure, construction in progress) less any related
outstanding debt used to acquire those assets. The city of Pasco uses these capital assets to
provide services to citizens; consequently, these assets are not available for future spending.
Although the City of Pasco’s investment in its capital assets is reported net of related debt, it
should be noted that the resources needed to repay this debt must be provided from other
resources, since the capital assets themselves cannot be used to liquidate these liabilities. 5%
($21.23) of the City’s net position represents resources that are subject to external restrictions on
how they may be used. The remaining $50.36 of unrestricted net position (11%) may be used to
meet the government’s ongoing obligations to citizens and creditors.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
18
At the end of the current fiscal year, the City of Pasco is able to report positive balances in all
three categories of net position, both for the government as a whole, as well as for its separate
governmental and business-type activities. The same held true for the prior fiscal year.
As mentioned in the financial highlights, the City’s net position increased by $41.26, during the
current fiscal year. Majority of the increase in the City’s net position was attributable to capital
grants and contributions received from developers in the form of donated infrastructure related
to residential and commercial development and state and federal grants received for street
construction and improvement projects, and, water and sewer infrastructure improvements.
Increase in fund balance as the City is gearing up for significant capital projects in transportation,
parks, and utilities.
2018 2017 2018 2017 2018 2017
NonCapital assets 77.52$ 63.33$ 48.07$ 38.60$ 125.59$ 101.93
Capital assets 245.73 227.02 188.32 187.67 434.05 414.69
Total assets 323.25 290.35 236.39 226.27 559.64 516.62
Deferred Outflows 2.77 1.95 0.33 0.43 3.10 2.38
Current liabilities 13.88 8.94 7.04 6.34 20.92 15.28
Noncurrent liabilities 29.63 32.91 49.52 52.21 79.15 85.12
Total liabilities 43.51 41.85 56.56 58.55 100.07 100.40
Deferred Inflows 6.20 3.62 0.67 0.43 6.87 4.05
Net position:
Investment in capital assets 236.87 217.06 147.34 141.37 384.21 358.43
Restricted 21.23 18.10 - - 21.23 18.10
Committed 3.90 5.37 - 3.90 5.37
Unrestricted 14.31 6.30 32.15 26.34 46.46 32.64
Total net position 276.31$ 246.83$ 179.49$ 167.71$ 455.80$ 414.54$
Governmental Activities Business-Type Activities
City of Pasco's Net Position (in millions)
Total Primary Government
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
19
Governmental Activities. Governmental activities increased the City of Pasco’s net position by
$29.48. The increase is attributable to robust national and local economy leading. Growth in
housing increased the donated asset to the City in form of the right of ways, roads, and other
infrastructure by $13.60, an increase of 125%. Additionally, robust growth has led to 2.7%
increase in taxes, and 14.4% increase in permits over prior year. The City also instituted new cost
allocation model and business license model, increasing revenue for General fund. The City has
made concerted effort to sell properties where it benefits its Citizens, accounting for increase in
net position. Increase in net position ensures City’s capacity to ensure same service level
agreement during difficult economic times when tax and permit revenues sharply decline.
Tax revenues for the City have been increasing at a steady race, reflecting a healthy and growing
economy; however, the rate of growth has slowed in 2018. Sales tax revenue increased by 5.5%
compared to 6.3% the prior year, and Real Estate Excise tax increased by 4.3% compared to 21%
in 2017. Property sales tax revenue that increased by 4.9% compared to 0.4% the prior year,
Similarly, B&O taxes decreased by 3.9%, mainly due warmer winter in 2018. Overall, taxes
increased by 2.7% in 2018 versus 8.8% in the same period.
2018 2017 2018 2017 2018 2017
Revenues
Program revenues:
Charges for services 27.17$ 24.79$ 28.17$ 25.82$ 55.34$ 50.61$
Operating grants & contributions 1.61 1.04 1.05 0.07 2.66 1.11
Capital grants & contributions 31.76 14.19 7.40 5.27 39.16 19.46
General revenues:-
Property taxes 8.35 7.96 8.35 7.96
Other taxes 30.44 29.82 30.44 29.82
Investment income and miscellaneous 4.46 4.09 0.57 0.21 5.03 4.30
Total revenues 103.79 81.89 37.19 31.37 140.98 113.26
Program expenses:
General government 6.95 8.59 6.95 8.59
Public safety 32.47 30.66 32.47 30.66
Transportation 18.05 17.89 18.05 17.89
Economic environment 6.87 6.89 6.87 6.89
Culture and recreation 9.49 9.17 9.49 9.17
Interest on long term debt 0.42 0.45 0.42 0.45
Water 10.28 10.20 10.28 10.20
Sewer 9.31 8.99 9.31 8.99
Process water reuse 2.51 2.59 2.51 2.59
Storm water 1.40 1.30 1.40 1.30
Irrigation 1.91 1.99 1.91 1.99
Total expenses 74.25 73.65 25.41 25.07 99.66 98.72
Excess/(deficiency) before transfers 29.54 8.24 11.78 6.30 41.32 14.54
Transfers (0.08) (0.07) - - (0.08) (0.07)
Changes in net position 29.54 8.24 11.78 6.30 41.32 14.54
Prior period adjustment 0.02 - - - 0.02 -
Total changes in net position 29.48$ 8.17$ 11.78$ 6.30$ 41.26$ 14.47$
City of Pasco's Change in Net Position (in millions)
Business-Type Activities Total Primary GovernmentGovernmental Activities
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
20
GOVERNMENTAL ACTIVITIES – REVENUES BY SOURCE
GOVERNMENTAL ACTIVITIES – EXPENSES AND PROGRAM REVENUES
Business-Type Activities. 29% of the increase in the City of Pasco’s net position is related to
business-type activities. In 2018, the business type activities made up 39% of the City’s net
position. The net position for business-type activities has increased by $11.78, mainly due to
increases in revenue from sales of utilities. City increased rates for Water, Sewer, Irrigation, and
Stormwater services by 5%, 6%, 3%, and 15% respectively. The City anticipates significant
Charges for
services
26%
Operating
grants &
contributions
2%
Capital grants
& contributions
31%
Property taxes
8%
Other taxes
29%
Investment
income and
miscellaneous
3%
Sources of Revenues 2018
Charges for
services
30%
Operating
grants &
contributions
1%
Capital grants
&
contributions
17%
Property taxes
10%
Other taxes
37%
Investment
income and
miscellaneous
5%
Sources of Revenues 2017
-
5.00
10.00
15.00
20.00
25.00
30.00
35.00
MILLIONS2018 Expenses 2018 Revenue 2017 Expense 2017 Revenue
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
21
investments to manage the aging infrastructure and growth as reflected in City’s 2019 -2024
Capital Improvement Plan.
UTILITY ACTIVITIES – EXPENSES AND PROGRAM REVENUES COMPARISON
Financial Analysis of the City’s Funds.
As noted earlier, the City of Pasco uses fund accounting to ensure and demonstrate compliance
with finance related legal requirements.
Governmental Funds. The focus of the City of Pasco’s governmental funds is to provide
information on near-term inflows, outflows and balances of spendable resources. Such
information is useful in assessing the City of Pasco financing requirements. In particular,
unreserved fund balance may serve as a useful measure of a government’s net resources available
for spending at the end of the fiscal year.
As of the end of the year 2018, the City of Pasco governmental funds reported combined ending
fund balances of $40.43, which is an increase of $3.96 from the prior year. Approximately 38%
of this total amount, $15.29 constitutes unassigned fund balance, which is available for spending
at the government’s discretion.
The General Fund is the chief operating fund of the City of Pasco. At the end of 2018, unassigned
fund balance of the general fund was $15.36. As a measure of the general fund’s liquidity, it may
be useful to compare unrestricted, unassigned fund balance to total expenditures. This represents
33.0% of total expenditures.
The fund balance of the City of Pasco’s General Fund increased during 2018 by $2.22, which is
4.5% of current year revenues or 4.8% of current year expenses. Overall revenues increased by
$3.36 (7.3%) and total expenditures increased by $1.46 (3.2%). General fund tax revenues
increased by $1.12 (3.5%). Property taxes increased approximately 4.9% due to new construction
and steady valuations, and sales taxes increased by 5.5% with the continued steady economic
recovery. City received Staffing for Adequate Fire and Emergency Response (SAFER) grants
for six full time firefighters (three funded by General Fund) and four full time police officers
-
2.00
4.00
6.00
8.00
10.00
12.00
14.00
Water Sewer Process Water
Reuse
Stormwater IrrigationMILLIONS
2018 Expenses 2018 Revenue 2017 Expense 2017 Revenue
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
22
funded by Office of Community Oriented Policing Services (COPS) in 2017 and 2018
respectively. Both grants will expire after three-year wages and benefit reimbursement period is
over. The City expects to see impact to fund balance once the grants are fully drawn down and
the General Fund absorbs the impact of seven additional positions.
The City was able to increase the number of approved personnel positions, by adding three
additional positions in 2018, as well as four funded by COPS grant. General Fund funded five
of those seven positions. The General Fund revenues of $49.38 exceeded expenditures of $46.61
before transfers in/out.
Proprietary Funds. The City of Pasco enterprise funds provide the same type of information
found in the government-wide financial statements, but in more detail and separately states the
activity of the Water/Sewer Utility from the internal service funds. Unrestricted net position of
the utility fund at the end of 2018 was $28.34. The working capital ratio is the current assets less
current liabilities and is a measure of liquidity for the utility to meet its short-term payment
obligations. At the end of 2018, the utility is well positioned as it has current assets of $43.75
available to meet its current liability obligations of $6.60, resulting in a working capital ratio of
6.6. The utility showed a gain before contributions and transfers of $4.07. Capital contributions
to the fund for year 2018 amounted to $7.40. The City continues to invest in new infrastructure
due to the growth of its population, as well as due to the need to address aging infrastructure
issues. The City has a meter and service replacement program with the goal of replacing its
meters on an average of once every ten years and is in the process of researching automatic meter
reading (AMR) and advanced metering infrastructure (AMI) options for future. Local
improvement districts (LIDs) are used by the utility to supplement the ratepayers’ participation
in capital construction.
General Fund Budgetary Highlights
The legal level of appropriation is at the fund level. The budget by function is shown to provide
information that is more detailed. There were increases to the original budget by $1.53 in
expenses. Majority of the increase was for public safety at the rate of $1.07.
Actual revenues were 108% of the original budget and expenses was 99% of the original budget.
Revenues are generally estimated low in order to protect the city from unanticipated funding
fluctuations. The City implemented new budgeting processes in 2018, resulting in City’s ability
to remain within original budget.
Capital Asset and Debt Administration
Capital Assets. The City of Pasco’s investment in capital assets for its governmental and
business-type activities as of December 31, 2018 amounts to $434.06 (net of accumulated
depreciation). This investment in capital assets includes land, buildings, improvements
machinery and equipment, park facilities, roads, water and sewer treatment plants, etc. The total
change in the City of Pasco’s capital assets (net of depreciation) for the current year was an
increase of $18.77 for governmental activities and an increase of $4.01 for business-type
activities.
Major capital asset activity during the current fiscal year included the following:
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
23
Capital spending in governmental funds for 2018 was $10.58: $0.42 for general
governmental purposes, $0.79 for public safety purposes, $8.08 for transportation
purposes, and $1.30 for culture and recreation purposes. The largest projects for 2018
were Oregon Avenue Corridor Improvement at $6.39 and Lewis Street Overpass at $0.72.
Capital spending in the utility fund (major component of business-activities) for 2018
was $5.59. The largest projects were Columbia Water Supply project at $2.04, and
Columbia East Lift Station $1.08 in 2018. (Run utilities fund on budget performance
report with 56 account)
Additional information on the City of Pasco’s capital assets can be found in Note 5 starting on
page 53.
Long-term Debt. At the end of 2018, the City of Pasco had total outstanding debt of $58.77
million. Of this amount, $8.87 million comprised debt backed by the full faith and credit of the
government. $49.90 million of the City of Pasco bonded debt represents bonds secured primarily
by specified revenue resources (e.g. revenue bonds).
Additional information on the City of Pasco’s long-term liabilities can be found in Note 7 starting
on page 56 of this report.
Economic Factors and Next Year’s Budgets and Rates (amounts not in millions)
In 2018, the Pasco economy was stable and continued to grow. The city issued 2,686 building
permits representing approximately $220 million in construction value. The number of permits
for the City increased by 2.7% in 2018 and the construction value went up by 9.6%, mainly due
to significant increase in warehouses and a new elementary school. Of the total permits, 485 were
for new single-family residences, which equates to $128 million in construction value. The
average value of a new home in Pasco was approximately $265,000, in 2018. This stable
2018 2017 2018 2017 2018 2017
Land 17.34$ 16.83$ 3.10$ 2.83$ 20.44$ 19.66$
Construction in process 15.74 12.72 13.65 10.31 29.39 23.03
Buildings and structures 32.54 31.52 33.13 34.00 65.67 65.52
Other improvements 2.89 3.16 0.19 0.20 3.08 3.36
Machinery and equipment 9.44 8.69 6.64 7.04 16.08 15.73
Infrastructure 167.80 154.10 131.60 129.92 299.40 284.02
Total capital assets 245.75$ 227.02$ 188.31$ 184.30$ 434.06$ 411.32$
Governmental Activities Total Primary GovernmentBusiness-Type Activities
City of Pasco's Capital Assets at Year-End (in millions)
(Net of Depreciation)
2018 2017 2018 2017 2018 2017
General Obligation Bonds 8.87$ 9.66$ 1.14$ 2.27$ 10.01$ 11.93$
Special Assessment Bonds - 0.02 - - 0.02
Loans & Notes - - 8.00 6.30 8.00 6.30
Revenue Bonds - - 40.76 42.52 40.76 42.52
8.87$ 9.68$ 49.90$ 51.09$ 58.77$ 60.77$
Governmental Activities Total Primary GovernmentBusiness-Type Activities
City of Pasco's Bonds and Notes
(in millions)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
24
economy was reflected in Standard & Poor’s rating the 2017 utility bond issue as AA-/Stable and
the 2015 General Obligation bond issue as AA-/Stable.
Businesses have continued making a significant investment in Pasco through their new or
existing infrastructure. Aforementioned Courtyard at Marriot, valued at $8,500,000 is under
construction. Pasco School District Elementary School, valued at $13,000,000 is also under
construction in 2018. Furthermore, a variety of commercial and industrial construction like new
hangar, offices, and retail spaces. In total, the City received more than $76 million investment
in construction for commercial and industrial purposes. Last year, City saw permitting and
construction of a large rental storage, Great Harvest, and Bleyhl, with $11,000,000 in value in
the Chapel Hill area, as well as, a multi-family complex in the East Ainsworth area valued at
$5,000,000.
The only fund larger than the General Fund is the Water/Sewer Utilit y Fund. The Water/Sewer
Utility Fund has grown rapidly over the past few years as it provides services to the thousands
of new homes built over the past decade. Since 2015, City has conducted comprehensive rate
studies for Water, Sewer, Stormwater, and Irrigation services and implemented necessary
annual rate increases. 2018’s rate increases are 5% for water; 6% for sewer; 3% for irrigation;
15% for Stormwater, and 3% for ambulance services.
Requests for Information
This financial report is designed to provide a general overview of the City of Pasco’s finances
for all those with an interest in the government’s finances. Questions concerning any of the
information provided in this report or requests for additional financial information should be
addressed to the Finance Director, PO Box 293, Pasco, WA 99301.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
25
BASIC FINANCIAL STATEMENTS
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
26
Governmental Business-Type Component Unit
Activities Activities Total
Pasco Public
Facility District
ASSETS
Current assets:
Cash & cash equivalents 31,180,487$ 19,793,422$ 50,973,909$ 74,104$
Restricted cash:
Program, grant, donations 1,867,126 1,867,126
Customer deposits 324,043 5,032,009 5,356,052
Unspent bond proceeds - 10,771,022 10,771,022
Debt covenants 153,856 1,138,583 1,292,439
Bond reserve 3,065,317 3,065,317
Investments 13,080,161 4,179,400 17,259,561
Receivables (net of allowances):
Taxes 3,830,925 3,830,925 90,996
Customers 3,206,702 2,653,201 5,859,903
Grants 5,073,685 1,033,157 6,106,842
Due from Other funds 3,628,354 3,628,354
Prepaids - 84,315 84,315
Inventories - 253,287 253,287
Total current assets 62,345,339 48,003,713 110,349,052 165,100
Noncurrent assets:
Restricted cash - cemetery endowment 461,945 461,945
Special assessments 249,492 66,190 315,682
Net Pension Asset 12,171,481 12,171,481
Net OPEB Asset 1,140,935 1,140,935
Joint Ventures 1,144,343 1,144,343
Capital assets not being depreciated:
Land 17,336,555 3,101,211 20,437,766
Construction work in progress 15,738,767 13,649,928 29,388,695
Capital assets net of accumulated depreciation:
Buildings and structures 32,537,159 33,133,180 65,670,339
Other improvements 2,891,889 192,989 3,084,878
Machinery and equipment 9,439,845 6,639,313 16,079,158
Infrastructure 167,788,569 131,602,998 299,391,567
Total noncurrent assets 260,900,980 188,385,809 449,286,789 -
Total assets 323,246,319 236,389,522 559,635,841 165,100
DEFERRED OUTFLOWS OF RESOURCES
Pension related 2,514,943 329,437 2,844,380
OPEB related 250,682 250,682
Total deferred outflows of resources 2,765,625 329,437 3,095,062 -
LIABILITIES
Current liabilities:
Accounts payable 5,022,649 2,390,915 7,413,564 138,067
IBNR payable from restricted assets 1,848,008 1,848,008
Due to other funds 3,603,353 3,603,353
Deposits payable from restricted assets 310,820 392,910 703,730
Accrued interest payable from restricted assets - 226,370 226,370
Compensated absences - current 2,261,050 216,161 2,477,211
Loans due to other governments - current - 627,262 627,262
Bonds - current 830,000 3,187,986 4,017,986
Total current liabilities 13,875,880 7,041,604 20,917,484 138,067
Noncurrent liabilities:
Compensated absences 703,049 8,236 711,285
Net OPEB obligation 16,223,295 16,223,295
Loans due to other governments - 7,376,044 7,376,044
Bonds payable (net of premium)8,035,000 40,560,970 48,595,970
Net pension liability 4,670,925 1,577,057 6,247,982
Total noncurrent liabilities 29,632,269 49,522,307 79,154,576
Total liabilities 43,508,149 56,563,911 100,072,060 138,067
DEFERRED INFLOWS OF RESOURCES -
Pension related 6,011,394 666,618 6,678,012
OPEB related 184,280 184,280
Unavailable revenues - 1,598 1,598
Total deferred inflows of resources 6,195,674 668,216 6,863,890
NET POSITION
Net investment in capital assets 236,867,784 147,338,379 384,206,163
Restricted for:
Cemetery (nonexpendable)531,234 531,234
Program, grant, donations 19,118 19,118
Streets and boulevards 8,635,462 8,635,462
Litter and housing abatement 415,588 415,588
Park development 2,219,436 2,219,436
Culture and recreation 98,638 98,638
Capital improvement 8,853,212 8,853,212
Economic development 96,235 96,235
Debt repayment/guarantee 361,663 361,663
Committed for:
Landfill 407,344 407,344
Special revenue funds 3,394,830 3,394,830
Construction projects 100,699 100,699
Unrestricted 14,306,878 32,148,453 46,455,331 27,033
Total Net Position 276,308,121$ 179,486,832$ 455,794,953$ 27,033$
The notes to the financial statements are an integral part of this statement.
Statement of Net Position
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
27
Charges for Operating Capital
Services, Fines &Grants and Grants and Governmental Business-Type Component Unit
Functional Programs
Expenses Licenses Contributions Contributions Activities Activities Total Pasco Public
Facility District
Primary Government:
Governmental activities:
General government 6,949,546$ 6,108,528$ 22,739$ -$ (818,279)$ -$ (818,279)$ -$
Public safety 32,469,647 8,807,448 810,515 - (22,851,684) - (22,851,684) -
Transportation 18,047,449 2,319,150 - 31,076,647 15,348,348 - 15,348,348 -
Natural & economic environment 6,873,371 6,074,688 765,669 74,588 41,574 - 41,574 -
Culture and recreation 9,490,359 3,864,291 14,973 605,000 (5,006,095) - (5,006,095) -
Interest on long term debt 420,896 (420,896) - (420,896) -
Total governmental activities 74,251,268 27,174,105 1,613,896 31,756,235 (13,707,032) - (13,707,032) -
Business-type activities:
Water 10,284,714 11,311,381 - 2,385,428 - 3,412,095 3,412,095 -
Irrigation 1,914,566 1,564,231 - 920,842 - 570,507 570,507 -
Sewer 9,308,582 9,447,327 - 3,488,113 - 3,626,858 3,626,858 -
Process Water Reuse 2,507,880 3,985,932 1,005,735 - - 2,483,787 2,483,787 -
Storm Water 1,395,283 1,862,786 42,148 600,887 - 1,110,538 1,110,538 -
Total business-type activities 25,411,025 28,171,657 1,047,883 7,395,270 - 11,203,785 11,203,785 -
Total primary government 99,662,293$ 55,345,762$ 2,661,779$ 39,151,505$ (13,707,032) 11,203,785 (2,503,247) -
Component units
Pasco Public Facility District
Total component units 562,012$ 20,000$ -$ -$ (542,012)
General Revenues:
Taxes:
Property taxes 8,352,750 8,352,750
Sales taxes 16,695,816 16,695,816 551,378
B&O taxes 10,104,500 10,104,500
Excise taxes 3,635,625 3,635,625
Intergovermental 3,588,842 3,588,842
Investment income and miscellaneous 871,497 570,613 1,442,110 389
Transfers (see note 6)(78,225) - (78,225)
Total general revenues and transfers 43,170,805 570,613 43,741,418 9,755
Change in net position 29,463,773 11,774,398 41,238,171 9,755
246,827,561 167,712,434 414,539,995 17,278
16,787 16,787
Net position - ending 276,308,121$ 179,486,832$ 455,794,953$ 27,033$
The notes to the financial statements are an integral part of this statement.
Statement of Activities
For the Year Ended December 31, 2018
Net position - beginning
Adjustments to Beginning Net Position see
note (17)
Program Revenues
Net Revenue (Expenses) and Changes in Net Position
Primary Government
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
28
Other
General Construction Governmental Total
ASSETS
Cash & cash equivalents 6,064,549$ 32$ 18,778,098$ 24,842,679$
Restricted cash
Program, grant, donation 19,118 - 19,118
Customer deposits 201,502 122,541 324,043
Cemetery endowement 461,945 461,945
Debt service 153,856 153,856
Investments 3,001,647 6,373,550 9,375,197
Receivables (net of allowances):
Taxes 3,270,060 560,865 3,830,925
Customers 1,417,350 - 1,788,140 3,205,490
Interfund loans 2,000,000 106,971 2,106,971
Grants 73,926 4,671,471 328,288 5,073,685
Special assessments & loans 249,492 249,492
Due from other funds 3,628,354 - 3,628,354
Total assets 19,676,506 4,671,503 28,923,746 53,271,755
LIABILITIES
Accounts payable 2,456,563 1,730,121 1,016,393 5,203,077
Interfund loans payable 2,125,301 2,125,301
Due to other funds 2,840,683 762,670 3,603,353
Deposits payable from restricted assets 195,700 115,120 310,820
Total liabilities 2,652,263 4,570,804 4,019,484 11,242,551
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue- property taxes 181,970 181,970
Unavailable revenue- special assessments 124,712 124,712
Unavailable revenue- court receivables 1,040,550 1,040,550
Unavailable revenue- other 10,790 239,240 250,030
Total deferred inflows of resources 1,233,310 363,952 1,597,262
FUND BALANCES (DEFICITS)
Nonspendable
Cemetery permanent fund 531,234 531,234
Restricted
Program, grant, donation 19,118 19,118
Street and boulevard 8,635,462 8,635,462
Litter & housing abatement 415,588 415,588
Park development 2,219,436 2,219,436
Cultural and recreation 98,638 98,638
Capital improvements 8,853,212 8,853,212
Economic development 96,235 96,235
Debt repayment/guarantee - 361,663 361,663
Committed
Landfill claims 407,344 407,344
Special revenue funds 3,394,830 3,394,830
Construction projects 100,699 100,699
Unassigned 15,364,471 (65,988) 15,298,483
Total fund balances 15,790,933 100,699 24,540,310 40,431,942
Total liabilities, deferred inflows of resources
and fund balances 19,676,506$ 4,671,503$ 28,923,746$
Amounts reported for governmental activities in the statements of net position
are different because:
Long-term assets used in governmental activities are not financial resources and
therefore are not reported in the government funds.254,703,357
Deferred pension outflows are not available to pay for current period expenditures and
therefore are not reported in the governmental funds.2,739,645
Long-term liabilities are not due and payable in the current period and therefore
are not reported in the funds. Proceeds from new debt and repayments of exisiting
debts are recorded as resources and expenditures for fund reporting but are additions
and reductions of liabilities for government wide reporting.(32,284,427)
Deferred inflows and proceeds from asset sales in governmental funds is susceptible to full
accrual therefore are not reported in the Statement of Net Activities. Other expenses are
susceptible to full accrual and are reported in the Statement of Net Activities but not
in the governmental funds.(4,982,247)
Internal Service funds are used by management to charge the costs of certain
activities to individual funds. The assets and liabilities of some internal service funds
are included in the governmental activities in the statement of net position. Interfund loans
between governmental activities are excluded.15,699,851
Net position of governmental activities ( see page 26)276,308,121$
The notes to the financial statements are an integral part of this statement.
Balance Sheet
Governmental Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
29
General Other
Fund Construction Governmental Total
REVENUES
Taxes 34,494,612$ -$ 4,294,079$ 38,788,691$
Licenses and permits 2,640,720 306,280 2,947,000
Intergovernmental revenue 2,376,588 7,273,596 4,216,737 13,866,921
Charges for services 7,285,865 10,888,433 18,174,298
Fines and forfeitures 943,321 128,497 1,071,818
Miscellaneous revenue 1,638,358 1,000 2,130,163 3,769,521
Total revenues 49,379,464 7,274,596 21,964,189 78,618,249
EXPENDITURES
Current:
General government 10,029,780 10,852 - 10,040,632
Public safety 25,879,450 126,506 7,247,682 33,253,638
Transportation 1,613,664 5,748 2,437,435 4,056,847
Natural & economic environment 2,224,043 - 4,450,085 6,674,128
Culture and recreation 5,538,208 191,943 3,102,872 8,833,023
Capital outlay:
General government 59,970 363,905 - 423,875
Public safety 78,249 669,162 42,302 789,713
Transportation - 8,083,713 - 8,083,713
Natural & economic environment 19,904 787 5,679 26,370
Culture and recreation - 540,512 761,816 1,302,328
Debt service:
Principal 795,000 20,000 815,000
Interest 372,300 48,596 420,896
Total expenditures 46,610,568 9,993,128 18,116,467 74,720,163
Excess of revenues over (under) expenditures 2,768,896 (2,718,532) 3,847,722 3,898,086
OTHER FINANCING SOURCES (USES)
Sale of assets 140,212 - 140,212
Transfers in 236,333 2,332,477 829,931 3,398,741
Transfers out (923,903) (86,666) (2,466,397) (3,476,966)
Total other financing sources (uses)(547,358) 2,245,811 (1,636,466) 61,987
Net change in fund balances 2,221,538 (472,721) 2,211,256 3,960,073
Prior period adjustments see (note 17)- 16,787 - 16,787
Fund balances - beginning 13,569,395 556,633 22,329,054 36,455,082
Fund balances - ending 15,790,933$ 100,699$ 24,540,310$ 40,431,942$
The notes to the financial statements are an integral part of this statement.
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
30
Net change in fund balances - total governmental funds 3,960,073$
Amounts reported for governmental activities in the Statement of Activities are
different because of the following reconciling items:
Governmental funds report capital outlays as expenditures. However, in the statement
of net position they are reported net of depreciation as a capital asset. Capital assets contributed
by private developers do not provide current resources and are not reported as revenues in the funds.20,246,635
The issuance of long-term debt (e.g. bonds, notes) provides current financial resources to
governmental funds, while the repayment of the principal of long-term debt consumes current
financial resources of governmental funds. Neither transaction, however, has any affect on net
assets. 815,000
Revenues reported in the statement of activies that do not provide current financial resources
are not reported as revenues in the funds.584,946
Some expenses such as for compensated absences, pension expense, gain on disposal of assets, etc.
are reported in the Statement of Net Activities do not the use of current financial resources and, therefore, 2,721,105
are not reported as expenditures in the governmental funds.
Internal service funds are used by management to charge the costs of certain activities to
individual funds. The net revenue of certain activity is reported with governmental
activities. Interfund transfers between govermental funds are eliminated in the Statement of Net Activities.1,136,014
Change in net position of governmental activities (see page 27)29,463,773$
The notes to the financial statements are an integral part of this statement.
Reconciliation of the Statement of Revenues, Expenditures, and
Changes in Fund Balance of Governmental Funds to the Statement of Activities
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
31
Original Final Variance to
Budget Budget Actual Final Budget
REVENUES
Taxes 33,060,476$ 34,204,476$ 34,494,612$ 290,136$
Licenses and permits 2,054,200 2,404,200 2,640,720 236,520
Intergovernmental revenue 2,317,438 2,317,438 2,376,588 59,150
Charges for services 7,093,604 7,193,604 7,285,865 92,261
Fines and forfeitures 853,100 843,100 943,321 100,221
Miscellaneous revenue 528,800 1,248,487 1,638,358 389,871
Total revenues 45,907,618 48,211,305 49,379,464 1,168,159
EXPENDITURES
Current:
General government 10,195,602 10,640,946 10,029,779 (611,167)
Public safety 24,755,757 25,826,167 25,879,449 53,282
Transportation 1,853,435 1,853,435 1,613,664 (239,771)
Natural & economic environment 2,055,603 2,055,603 2,224,043 168,440
Culture and recreation 5,371,988 5,371,988 5,538,208 166,220
Capital outlay:
General government 143,704 112,545 59,971 (52,574)
Public safety 27,000 74,023 78,250 4,227
Natural & economic environment 19,904 19,904
Debt service:
Principal 795,000 795,000 795,000 -
Interest 371,700 371,700 372,300 600
Total expenditures 45,569,789 47,101,407 46,610,568 (490,839)
Excess of revenues over (under) expenditures 337,829 1,109,898 2,768,896 677,320
OTHER FINANCING SOURCES (USES)
Sale of Capital Asset 177,000 140,212 (36,788)
Transfers in 227,600 227,600 236,333 8,733
Transfers out (775,000) (775,000) (923,903) (148,903)
Total other financing uses (547,400) (370,400) (547,358) (176,958)
Net change in fund balances (209,571) 739,498 2,221,538 500,362
Fund balances - beginning 13,500,000 13,500,000 13,569,395 69,395
Fund balances - ending 13,290,429$ 14,239,498$ 15,790,933$ 569,757$
Interfund loan activity included for budget purposes but not
included in Statement of Revenues, Expenditures and Changes
in Fund Balance -
Fund balances - ending 15,790,933$
The notes to the financial statements are an integral part of this statement.
Statement of Revenues, Expenditures, and Changes in Fund Balances-Budget to Actual
General Fund
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
32
Water/Sewer Internal
Utility Service
ASSETS
Current assets:
Cash and cash equivalents 16,363,174$ 9,768,056$
Restricted cash equivalents:
Claims incuured but not reported (IBNR)1,848,008
Customer deposits 5,032,009 -
Unspent bond proceeds 10,771,022 -
Revenue bond covenants 1,138,583 -
Bond reserve 3,065,317 -
Investments 3,357,225 4,527,139
Receivables (net of allowances):
Customers 2,653,201 1,212
Grants 1,033,157 -
Prepaid-Other 84,315 -
Inventory 253,287 -
Total current assets 43,751,290 16,144,415
Noncurrent assets:
Special assessments 66,190 -
Capital assets not being depreciated:
Land 3,101,211 -
Construction work in progress 13,649,928 -
Capital assets net of accumulated depreciation:
Buildings and structures 33,133,180 -
Other Improvements 192,989 -
Machinery and equipment 4,985,854 7,279,859
Infrastructure 131,602,998 -
Total noncurrent assets 186,732,350 7,279,859
Total assets 230,483,640 23,424,274
DEFERRED OUTFLOWS
Pension related 329,437 25,980
LIABILITIES
Current liabilities:
Accounts payable 1,950,317 260,170
IBNR payable from restricted assests 1,848,008
Other liabilities
Customer deposits payable from restricted assets 392,910
Accrued interest payable from restricted assets 226,370
Compensated absences - current portion 216,161 -
Loans due to other governments - current portion 627,262
Revenue bonds - current portion 3,187,986
Total current liabilities 6,601,006 2,108,178
Noncurrent liabilities:
Compensated absences 8,236 -
Loans due to other governments 7,376,044 -
Current Portion Loan PayableRevenue bonds payable (net of premium)40,560,970 -
Net pension obligation 1,577,057 124,371
Total noncurrent liabilities 49,522,307 124,371
Total liabilities 56,123,313 2,232,549
DEFERRED INFLOWS
Unavailable Revenue 1,598
Pension related 666,618 52,570
NET POSITION
Net investment in capital assets 145,684,920 7,279,859
Unrestricted 28,336,628 13,885,276
Total net position 174,021,548$ 21,165,135$
5,465,284
Net position of business-type activities (see page 26)179,486,832$
The notes are an integral part of this statement.
Statement of Net Position
Proprietary Funds
December 31, 2018
Adjustment for the net effect of the current year
activity between the internal service funds and the
enterprise fund
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
33
Business Type
Water/Sewer Internal
Utility Service
OPERATING REVENUES
Permits 195,800$ -$
Charges for services 27,975,857 10,130,577
Total operating revenues 28,171,657 10,130,577
OPERATING EXPENSES
Depreciation 7,012,375 1,010,289
Salaries and wages 3,336,849 442,625
Personnel benefits 883,142 183,492
Supplies 1,991,868 1,003,723
Services 10,705,921 6,401,762
Total operating expenses 23,930,155 9,041,891
OPERATING INCOME 4,241,502 1,088,686
NONOPERATING REVENUES (EXPENSES)
Investment income 413,342 217,153
Miscellaneous 37,511 126,330
Rents and leases 41,242 -
Grant 1,047,883 -
Gain (Loss) Sale of Asset 78,518 -
Gain (Loss) on disposal of property - 8,222
Interest expense (1,785,248) -
Total nonoperating revenues (expenses)(166,752) 351,705
Income (loss) before contributions
and transfers 4,074,750 1,440,391
Capital contributions 7,395,270 -
Transfers in - 75,000
Transfers out - (75,000)
Changes in net position 11,470,020 1,440,391
Net position - beginning 162,551,528 19,724,744
Net position - ending 174,021,548 21,165,135$
Changes in net position 11,470,020
Adjustment for the net effect the current year activity
between the internal service funds and the enterprise fund 304,378
Change in net position of business-type activities (page 27)11,774,398$
The notes to the financial statements are an integral part of this statement.
Statement of Revenues, Expenses, and Changes in Net Position
Proprietary Funds
For the Fiscal Year Ended 12/31/2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
34
Water/Sewer Internal
Utility Service
CASH FLOW FROM OPERATING ACTIVITIES
Receipts from customers 27,842,909$ 10,129,365$
Payments to employees (4,822,688) (622,062)
Payments to suppliers (13,006,810) (6,890,693)
Net cash provided by (used for) operating activities 10,013,411 2,616,610
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:-
Grants 47,883 -
Miscellaneous 37,511 126,330
Rents and leases 41,242 -
Net cash provided from noncapital financial activities 126,636 126,330
CASH FLOW FROM CAPITAL AND RELATED FINANCING
ACTIVITIES
Proceeds from sale of assets 43,900 65,353
Gain on Sale of asset 78,518 -
Acquisition and construction of capital assets (5,587,716) (935,168)
Principal paid on capital debt (3,421,977) -
Interest paid on capital debt (1,762,332) -
Payments received from notes and loans 1,500,000 -
Capital charges 2,095,406
Capital grant and contribution proceeds 4,222,045 -
Net cash provided by (used for) capital and related financing activities (2,832,156) (869,815)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of investments 1,577,645 937,055
Purchase of investments 2,011,827 1,025,234
Interest on investments 413,342
Interfund loan repayment - 14,567
Net cash provided from investing activities 4,002,814 1,976,856
Net increase (decrease) in cash and cash equivalents 11,310,705 3,849,981
Beginning cash and cash equivalents 25,059,400 7,766,083
Ending cash and cash equivalents 36,370,105 11,616,064
Reconciliation of operating income (loss) to net cash provided by
(used for) operating activities:
Net Operating Income 4,241,502 1,088,686
Adjustment to reconcile operating income (loss) to net cash provided by
(used for ) operating activities:
Depreciation expense 7,012,375 1,010,289
(Increase) decrease in customer receivables (363,606) (1,212)
Decrease in prepaid expenses (84,315) -
(Increase) decrease in inventories (16,497) -
Increase (decrease) in accounts payable (208,209) 514,792
(Decrease) increase in accounts customer deposits payable 34,858
(Decrease) increase in compensated absences (21,485)
(Increase) decrease in pension deferred outflow 102,170 (586)
Increase (decrease) in pension obligation (922,818) (22,703)
Increase (decrease) in pension deferred inflow 239,436 27,344
Net cash provide by (Used for) Operating Activities 10,013,411$ 2,616,610$
NON CASH ACTIVITIES
Contributions of capital assets 5,299,864 -
Total noncash activities 5,299,864$ -$
The notes to the financial statements are an integral part of this statement.
Statement of Cash Flows
Proprietary Funds
For the Fiscal Year Ended 12/31/2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
35
Pension and Other
Post-Employment
Benefits Agency
ASSETS
Cash & cash equivalents 441,534$ 370,884$
Receivables
Interfund Loan 18,330
Investments
Federal Agency 19,368
Mutual Funds 4,928,997
Total assets 5,408,229 370,884
LIABILITIES
Due to others - 370,884
Total liabilities - 370,884$
NET POSITION
Held in trust for pension benefits/other
post employment benefits 5,408,229$
The notes to the financial statements are an integral part of this statement.
Statement of Net Position
Fiduciary Funds
December 31, 2018
Pension and Other
Post-Employment
Benefits
ADDITIONS
Taxes 73,414$
Investment earnings
Interest (323,178)
Dividends 98,750
Total Additions (151,014)
DEDUCTIONS
Pension benefits 128,399
Medical premiums 87,540
Administrative expenses 10,584
Total deductions 226,523
Change in net position (377,537)
Net position - beginning 5,785,766
Net position - ending 5,408,229$
The notes to the financial statements are an integral part of this statement.
Statement of Changes in Net Position
Fiduciary Funds
For the year ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
36
EDGAR BROWN STADIUM
SOFTBALL COMPLEX AND GESA STADIUM
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
37
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the City of Pasco have been prepared in conformity with generally
accepted accounting principles (GAAP) as applied to governmental units. The Governmental
Accounting Standards Board (GASB) is the accepted standard setting body for establishin g
governmental accounting and financial reporting principles. The significant accounting policies
are described below.
A. Reporting Entity
The City of Pasco was incorporated on May 4, 1891 and operates under the laws of the
state of Washington applicable to a Non-Charter Code City with a Council/Manager
form of government. As required by the generally accepted accounting principles the
financial statements present City of Pasco as a primary government unit. The
component unit discussed below is included in the City reporting entity because of the
significance of its operational relationship with the City of Pasco.
The Pasco Public Facility was created in 2002 pursuant to Chapter 35.57 of the Revised
Code of Washington for the purposes of acquiring, constructing, operating and
financing one or more regional centers through cooperative and joint ventures with the
City of Kennewick. The PFD is discreetly presented in the component unit column in
the government-wide financial statements to emphasize that is a legally separate entity.
Complete separate financial statements for the District may be obtained from the City of
Pasco, P.O. Box 293, Pasco, WA 99301.
B. Basis of Presentation - Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the
statement of activities) report information on all of the non-fiduciary activities of the
primary government and its component unit. Although fiduciary funds are excluded
from the government-wide financial statements, all pension and other post-employment
benefits (OPEB) components of fiduciary funds are required to be reported in the
government-wide financial statements. For the most part, the effect of inter-fund
activity has been removed from these statements. Governmental activities, which
normally are supported by taxes and intergovernmental revenues, are reported
separately from business-type activities, which rely to a significant extent on fees and
charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a
given function or segment is offset by program revenues. Direct expenses are those that
are clearly identifiable with a specific function or segment. Our policy is to allocate
indirect costs to a specific function or segment. Program revenues include 1) charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function or segment and 2) grants and contributions that
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
38
are restricted to meeting the operational or capital requirements or a particular function
or segment. Taxes and other items not properly included among program revenues are
reported instead as general revenues.
As a general rule the effect of the inter-fund activity has been eliminated from the
government–wide financial statements. Exceptions to this rule include business taxes
the utility pays to the general fund, activities in internal service funds in which outside
parties are engaged and certain other service functions between funds, that if eliminated
may misrepresent the cost reported for various other functions of the government.
Separate fund financial statements are provided for governmental funds, proprietary
funds, and fiduciary funds. Major individual governmental funds and major individual
enterprise funds are reported as separate columns in the fund financial statements.
The City of Pasco reports the following major governmental funds:
The General Fund: The General (or current expense) Fund is the City of Pasco’s
primary operating fund. It accounts for all financial resources of the general
government, except those required or elected to be accounted for in separate fund.
The Construction Fund: the Construction Fund is a capital project fund used to
account for significant construction and capital acquisition related to governmental
activities.
The City of Pasco reports the following major proprietary fund:
The Water/Sewer Fund: the Water/Sewer Fund accounts for water, sewer, water
reuse, storm water and irrigation utilities activities.
Additionally, the City of Pasco reports the following fund types:
Special Revenue funds are used to account for specific revenue sources that are
restricted, committed, or assigned to expenditures for a particular purpose.
Debt Services funds are used to account for the resources accumulated and
payments made for principal and interest on long–term general obligation debt of
governmental funds.
Permanent funds are used to report resources that are legally restricted to the extent
that only earnings, not principal, may be used for purposes that support the
government’s program.
Internal Service funds are used to account for equipment replacement and
operations, central stores, as well as medical/dental insurance services provided to
other departments on a cost-reimbursement basis.
Pension Trust funds are used to account for the sources and uses of funds to meet
the pension benefit and other post-employment benefit obligations made to firemen
covered under the Plan prior to the creation of the Law Enforcement Officers and
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
39
Fire Fighters’ (LEOFF) pension system in 1970.
Agency funds are used to report resources held by the city in a purely custodial
capacity on behalf of the Animal Control Authority and on behalf of all employees
for Payroll Clearing and those employees with Flexible Spending Accounts.
C. Measurement Focus, Basis of Accounting
Government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund and
fiduciary fund financial statements. 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
imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial
resources measurement focus and the modified accrual basis of accounting. Revenues
are considered to be available when they are collectible within the current period or
soon enough thereafter to pay liabilities of the current period. For this purpose, the City
considers revenues to be available if they are collected within 60 days of the end of the
current fiscal period. The City considers property taxes as available if they are collected
within 60 days after year end. 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 judgements are recorded
only when payment is due.
Property taxes, licenses, and interest associated within the current period are all
considered to be susceptible to accrual and so have been recognized as revenues of the
current period. Only the portion of special assessment receivable due within the current
fiscal period is considered to be susceptible to accrual as revenue of the current period.
All other revenue items are considered to be measurable and available only when cash
is received by the City.
Proprietary fund financial statements are reported using the economic resources
measurement focus and full-accrual basis of accounting. Revenues are recorded when
earned and expenses are recorded when a liability is incurred regardless of the timing
of the cash flows. Proprietary funds distinguish operating revenues and expenses from
non-operating items. Operating revenues and expenses generally result from providing
services and producing and delivering goods in connection with a proprietary fund’s
principal ongoing operations. The principal operating revenues of the Water/Sewer
Fund are charges to customers. The major services provided by the proprietary fund are
water, sewer, storm drain, irrigation and industrial waste water processing. Operating
expenses for enterprise funds and internal service funds include the cost of sales and
services, administrative expenses, and depreciation on capital assets. All revenues and
expenses not meeting this definition are reported as non-operating revenues and
expenses.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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D. Budgetary Information
1. Scope of Budget
Annual appropriated budgets are adopted for the general and special revenue and on a
modified accrual basis. Budgets for debt service and capital project funds are adopted at
the level of the individual debt issue or project and for fiscal periods that correspond to
the lives of debt issues or project and for fiscal periods that correspond to the lives of debt
issues or projects. The City also adopts appropriated budgets for proprietary, debt service,
and internal service funds. All budgets are adopted at the fund level.
Appropriations for all funds lapse at year-end. Budgets for capital outlays are re-
appropriated until the purpose of the appropriation has been accomplished or abandoned.
2. Amending the Budget
The City Manager is authorized to transfer budgeted amounts withi n the funds.
However, any revisions that alter the total appropriations of a fund, or which affects the
number of authorized employee positions, salary ranges, hours, or other conditions of
employment must be approved by the City Council.
When City Council determines it is in the best interest of the City of Pasco to increase or
decrease the appropriation for a particular fund, it may do so by ordinance approved by
one more than the majority after holding public hearing(s).
The budget amounts shown in the financial statements are the final authorized amounts
as revised during the year.
The financial statements contain the original and final budget information. The original
budget is the first complete appropriated budget. The final budget is the original budget
adjusted by all reserves, transfers, allocations, supplemental appropriations, and other
legally authorized changes applicable for the fiscal year.
Excess of Expenditures over Appropriations
Neither the General Fund, nor any major special revenue funds, reported expenditures in
excess of budgeted appropriation.
Deficit Fund Net Position
The LID Loan Fund, a non-major debt service fund of the City, ended the year with a
negative fund balance of ($65,988). The negative fund balance is a result of required
accounting practices. Previously most LID’s were financed with a bond issue which is
not reflected on the balance sheet of the governmental fund. The current LID’s are
financed with inter-fund loans which are recorded as a loan payable on the balance sheet.
Since GASB requires future principal payments to be recorded as deferred inflows on the
balance sheet. Both items are recorded on the liability side of the balance sheet with only
the LID assessments receivable on the asset side. The result is almost always a negative
net position for the fund. The deficit fund balance will be corrected as the loans are paid
off.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
41
The Rivershore Trail & Marina Maintenance Fund, a nonmajor special revenue fund of
the City, ended the year with a negative fund balance of ($294,608). The negative fund
balance is a result of the need to rebuild a marina dock to due weather related damage.
The Fund’s cash significantly decreased due to insurance deductible and repair charges
pending insurance recovery.
The Ambulance Services fund, a nonmajor special revenue fund of the City, ended the
year with a negative fund balance of ($465,797). The negative fund balance is a result of
a $800,900 receivable from Washington Healthcare Authority for Ground Emergency
Medical Transportation (GEMT) reimbursements.
The City Street fund, a nonmajor special revenue fund of the City, ended the year with a
negative fund balance of ($148,444). Most street projects are reimbursed by grants or
interfund charges. Reimbursements are requested periodically during completion of the
work. Subsequent draws and/or reimbursement payments will correct the deficit balance.
E. Assets, Liabilities, Deferred Inflows, Deferred Outflows, Fund Balance/Net Position
1. Cash and Cash Equivalents
It is the City’s policy to invest temporary cash surpluses. As of December 31, 2018, the
City had invested $ 40,121,642 with the Washington State Local Government
Investment Pool (LGIP). These investments are short-term investments of residual
cash. This amount is classified on the Statement of Net Position as cash and cash
equivalents. The interest earned on these investments is prorated to the various funds
based upon their ownership of invested cash.
For purposes of the statement of cash flows, the City considers all highly liquid
investments (including restricted assets) with a maturity of three months or less when
purchased to be cash equivalents.
2. Investments See (Note 3, Deposits and Investments)
3. Receivables
Taxes receivable consist of property taxes, sales taxes, business and occupation taxes,
gambling and excise taxes. Property taxes are levied January 1 on property values
assessed as of December of the prior year. The tax levy is divided into two billings; the
first billing is due April 30 and the second is due October 31. Detailed information on
property tax can be found in Note 4.
Special assessments are levied against certain property owners when their property is the
beneficiary of a City managed project. Based upon each property’s proportional share of
the improvement an assessment is levied. When levied a receivable in recorded. Special
assessments receivable consists of current, and any delinquent, assessments and related
interest and penalties. As of December 31, 2018, $9,441 of special assessments receivable
were delinquent.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Customer accounts receivables consist of amounts owned from private individuals or
organizations for goods and services, including amounts owed for which billings have
not been prepared. Uncollectible amounts, with one exception, are considered
immaterial and the direct write-off method is used. The exception is in the Ambulance
fund. An allowance is calculated based on historical write-offs. The allowance as of
the end of 2018 is $46,422.
Other receivables include municipal court receivables related to legal fines and charges
and amounts due the City related to organizations or public entities with which the City
has entered contractual relationships. The municipal court receivable is $11,261,368 of
which $10,220,818 is not expected to be collected. Only the net receivable of
$1,040,550 is recorded in the financial statements. The portion that is calculated as
uncollectible is based upon the year’s collection rate. Of the receivables derive based
upon contractual relationships they are the result of the provision of working funds or
activity that created revenues that the City had not received as of yearend 2018.
4. Amounts Due to and from Other Governments, Interfund Loans and Advances
Receivable
Activities between funds that are representative of lending/borrowing arrangements
outstanding at the end of the fiscal year are referred to as either interfund loans
receivable/payable or advances to/from other funds. All other outstanding balances
between funds are reported as due to/from other funds. Any residual balances
outstanding between the governmental activities and business-type activities are
reported in the government-wide financial statements as internal balances. A separate
schedule of interfund loans receivable and payable is furnished in Note 6, Interfund
Balances and Transfers.
Advances between funds, as reported in the fund financial statements, are offset by a
fund balance reserve account in applicable governmental funds to indicate that they are
not available for appropriation and are not expendable available financial resources.
5. Inventories
Inventories in governmental funds consist of expendable supplies held for consumption.
The cost is recorded as an expenditure at the time purchase. There are currently no
inventories in governmental funds. Inventories in proprietary funds consist of materials
and supplies used in both maintenance and capital activities. Inventories in proprietary
funds are valued using a last in first out (LIFO) method.
6. Restricted Assets and Liabilities
In accordance with utility bond ordinances, state law, or other agreements, separate
restricted assets have been established. These accounts contain resources restricted for
use only on specific activity. Some examples are capital construction activity, debt
service, or reimbursements of customers’ deposits. The current portion of related
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
43
liabilities is shown as Payables from Restricted Assets. Specific debt service reserve
requirements are described in Note 8, Long-Term Debt.
The restricted assets of the enterprise funds are composed of the following:
7. Capital Assets
Capital assets, which include property, plant, and equipment and infrastructure assets,
are reported in the applicable governmental or business-type columns in the government-
wide financial statements. Capital assets, other than infrastructure, are defined by the
City as assets with an initial, individual cost of more than $5,000 and an estimated useful
life in excess of one year. Such assets are recorded at historical cost or estimated
historical cost if purchased or constructed. Donated capital assets are recorded at
acquisition value at the date of donation.
The City reports infrastructure assets on a network and subsystem basis. Such assets are
recorded at historical cost if purchased or constructed. Additions, improvements and other
capital outlays that significantly extend the useful life of an asset are capitalized. The cost
of normal maintenance and repairs and street preservation activities that do not add to the
value of the asset or materially extend asset lives are not capitalized. Assets are
depreciated over their useful lives using the straight line depreciation method.
Major outlays for capital assets and improvements are reported as Construction Work in
Progress as projects are constructed. Interest, if material to the cost of the asset that is
incurred during the construction phase of the capital assets of business-type activities is
included as part of the capitalized value of the assets constructed. Capital Assets and
improvements are capitalized once the project is completed.
Capitalization thresholds, the dollar value above which an asset acquisitions are added
to the capital asset accounts and estimated useful lives of capital assets are as follows:
Customer Deposits 392,910$
Water/Sewer capital expansion contributions 4,639,099
Unspent Bond Proceeds 10,771,022$
Assets Threshold Useful Lives
Land All N/A
Building & structure 5,000$ 5 - 50
Other Improvements 5,000 5 - 100
Machinery & equipment & vehicles 5,000 1 - 50
Infrastructure 5,000$ 5 - 50
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
44
8. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will sometimes report 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 so will not be recognized as an outflow of resources
(expense/expenditure) until then.
In addition to liabilities, the statement of financial position will sometimes report 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 will not be recognized as an inflow of resources (revenue)
until that time.
The city has one type of item, unavailable revenues which arises only under a modified
accrual basis of accounting, which qualifies as a deferred inflow. Unavailable revenue is
reported only in the governmental funds balance sheet. The governmental funds report
unavailable revenues for 2018 as follows:
a. Uncollected property taxes levied.
b. Unbilled special assessments levied against benefited property for the cost of local
improvements. An allowance for uncollectible accounts is not necessary since the
assessments are liens against the property benefited.
c. Rain checks and gift certificates issued by the golf course and certain headstones and
liner sales by the cemetery which obligate the city to future services.
d. CDBG Loans Unbilled Principal.
e. Uncollected Municipal Court Fines outstanding.
In addition to unavailable revenues, changes in pension assumptions and calculation
variables also create deferred inflows and deferred outflows. These are reported in the
enterprise funds and at the government wide level in the Statement of Net Position.
9. Compensated Absences
The City accrues accumulated unpaid vacation and sick leave and associated employee
related costs when earned (or estimated to be earned) by the employee. All vacation and
sick pay is accrued when incurred in the government-wide, proprietary, and fiduciary fund
financial statements. In governmental funds, such amounts are not accrued using the
modified accrual basis of accounting but are reported as a liability in the government-wide
financial statements.
Sick leave may be accumulated up to a maximum of 960 hours for all employees except
firefighters. Firefighter sick leave may be accumulated up to a maximum of 840 hours.
Upon resignation, retirement or death, sick leave is payable at a rate of 25% of accrued
hours up to a maximum accrual base of 720 hours. Vacation leave may be accumulated up
to a maximum of one and a half times the employee’s annual vacation accrual rate and is
payable upon resignation, retirement or death.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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10. Pensions and OPEB
For purposes of measuring the net pension liability, deferred outflows of resources and
deferred inflows of resources related to pensions, and pension expense, information about
the fiduciary net position of all state sponsored pension plans and additions to/deductions
from those plans’ fiduciary net position have been determined on the same basis as they
are reported by the Washington State Department of Retirement Systems. For this
purpose, benefit payments (including refunds of employee contributions) are recognized
when due and payable in accordance with the benefit terms. Investments are reported at
fair value.
For purposes of measuring the net OPEB liability, deferred outflows of resources and
deferred inflows of resources related to OPEB, and OPEB expense information about the
fiduciary net position of the City of Pasco LEOFF 1 Plan, (the plan) and additions
to/deductions from the Plan’s fiduciary net position have been determined on the same
basis as they are reported by the plan. For this purpose, the plan recognizes benefit
payments when due and payable in accordance with the benefit terms. The LEOFF 1
OPEB plan is accounted for using a modified accrual basis of accounting.
11. Long-term Obligations
In the government-wide statements and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type
statements of net position.
Bond premiums and discounts, as well as issuance costs, when material, are deferred and
amortized over the life of the bonds using the effective interest method. Bonds payable
are reported net of the applicable bond premium or discount.
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of
debt issued is reported as other financing sources. Premiums received on debt issuances
are reported as other financing uses. Issuance costs, whether or not withheld from actual
debt proceeds received, are reported as professional service costs.
12. Fund Balance and Fund Flow Policies
Fund balance of governmental funds is reported in various categories based on the nature
of any limitations requiring the use of resources for specific purposes. The government
itself can establish limitations on the use of resources through either a commitment
(committed fund balance) or an assignment (assigned fund balance).
The committed fund balance classification includes amounts that can be used only for
specific purposes determined by formal action of the government’s highest level of
decision-making authority. The city council is the highest level of decision making
authority for the government that can, by adoption of an ordinance prior to the end of the
fiscal year, commit fund balance. Once adopted, the limitation imposed by the ordinance
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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remains in place until a similar action is taken (the adoption of another ordinance) to
remove or revise the limitation.
Amounts in the assigned fund balance classification are intended to be used by the
government for specific purposes but do not meet the criteria to be classified as
committed. The council may also assign fund balance as it does when appropriating fund
balance to cover a gap between estimated revenue and appropriations in the subsequent
year’s appropriated budget. Unlike commitments, assignments generally only exist
temporarily. In other words, an additional action does not normally have to be taken for
the removal of an assignment. Conversely, as discussed above, an additional action is
essential to either remove or revise a commitment.
The City has not adopted a specific flow of funds policy relating to the use of restricted
and unrestricted resources when both are available. Therefore, the statements are prepared
using the default option provided in GASB 54 which provides that when both restricted
and unrestricted resources are available, restricted resources are used first.
In the fund financial statements, governmental funds report restrictions of fund balance as
follows:
Nonspendable fund balance - includes amounts that are not in spendable form such as
inventory or are required to be maintained intact such as the principal of a permanent fund.
Restricted fund balance - includes amounts that can be spent only for the specific purpose
stipulated by external resource providers such as for grant providers, bondholders, higher
levels of government, or through enabling legislation.
Committed fund balance – includes amounts that can be used only for the specific purposes
determined by a formal action of the city council. Commitments may be changed or lifted
only by the City Council taking the same formal action that imposed the constraint
originally.
Assigned fund balance – includes amounts intended to be used by the government for
specific purposes. Intent can be expressed by the governing body or by an official
designated by the governing body to which the governing body designates authority.
Unassigned fund balance - includes amounts that are available for any purpose.
NOTE 2: RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
A. Explanation of certain differences between the governmental funds balance sheet
and the government-wide statement of net position.
The governmental fund balance sheet includes a reconciliation between fund balance – total
governmental funds and net position – governmental activities as reported in the
government-wide statement of net position. One element of that reconciliation explains that
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
47
“Long-term assets used in governmental activities are not financial resources and,
therefore, are not reported in the funds”. The following shows the detail of these capital
asset changes net of accumulated depreciation:
B. Explanation of certain differences between the governmental funds statement of
revenues, expenditures, and changes in fund balances and the government-wide
statement of activities
The governmental funds’ statement of revenues, expenditures and changes in fund balances
includes reconciliation between net changes in fund balances – total governmental funds
and changes in net position of governmental activities as reported in the government-wide
Joint Venture 55,777$
Land 16,831,768
Construction in process 11,399,078
Building 31,522,941
Other Improvements 3,162,778
Equipment 4,081,601
Infrastructure 154,090,363
Pension Assets 8,519,268
OPEB Assets 1,410,992
Current year change in pension asset 3,652,213
Current year change in OPEB asset (270,057)
Current year spending in construction work in progress 9,658,079
Current year capital purchases 967,922
Current year capital donations received 24,449,859
Current year increase in Joint Venture 1,088,566
Current year depreciation (15,917,791)
Net adjustment to add to government wide fund balance to arrive at
Net Position Governmental Activities 254,703,357$
Beginning Balance of Capital Asset Excluded from Fund Level:
Compensated absences (2,712,102)$
OPEB obligation (16,179,101)
Pension obligation (6,487,320)
Bonds payable (9,661,670)
Current year changes to pension obligation 1,940,766
Current year principal payments reducing debt 815,000
Net adjustment to reduce government wide fund balance to arrive at
Net Position Governmental Activities (32,284,427)$
Another element of that reconciliation explains the "Long-term liabilities are not due and payable in the
current and are not reported in the funds. The following show the detail of these liability changes.
Beginning Balance of Long-Term Liabilities Excluded from Fund Level:
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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statement of activities. The first element of that reconciliation relates to capital activity as
follows:
NOTE 3: DEPOSITS AND INVESTMENTS
Deposits
As of December 31, 2018 the carrying amount of the City’s cash balances was $74,350,635 which
consisted of $34,705,804 in the City’s checking account at US Bank, $40,121,642 deposited in the
Local Government Investment Pool, deposits in transit of $348,348, less outstanding checks of
$825,159. A portion, $550,691, of the deposits are maintained for the benefit of the fiduciary funds
the City supports.
Custodial Credit Risk
Custodial credit risk for deposits is the risk that in the event of a failure of a failure of a depository
financial institution, the City would not be able to recover deposits or will not be able to recover
collateral securities that are in possession of an outside party. The City deposits and certificates of
deposit are mostly covered by federal depository insurance (FDIC) or by collateral held in a
multiple financial institution collateral pool administered by the W ashington Public Deposit
Protection Commission (PDPC). The FDIC insures the first $250,000 of the City’s deposits. The
deposit balances over $250,000 are insured by the WPDPC. The City does not have a deposit policy
for custodial credit risk beyond the requirements of state statute. Washington State law restricts
deposit of funds to financial institutions physically located in Washington unless otherwise
expressly permitted by statute and authorized by the WPDPC. State statute permits additional
amounts to be assessed on a pro rata basis to members of the WPDPC pool in the unlikely event
the pool’s collateral should be insufficient to cover a loss.
Investments
Investments are stated at fair value based on quoted market prices in accordance with GASB
Statement No. 72, Fair Value Measurement and Application. Accordingly, the change in the fair-
value of investment is recognized as an increase or decrease to the investment assets and investment
income. Interest income on investments is recognized in non-operating revenue as earned. Changes
in fair value of investments are recognized on the statements of Revenues, Expenses, and Changes
in Net Position.
Land -$
Building & Structure 737,125
Construction in process 9,658,079
Machinery and equipment 230,795
Contributed capital assets 24,449,859
Current year depreciation (15,917,791)
Gain on Joint venture 1,088,566
Net capital activity 20,246,633$
New Debt issued -$
Debt repayment (815,000)
Net debt activity (815,000)$
The second element of that reconciliation related to debt activity as follows
Capital outlays for:
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Interest Rate Risk
Interest rate risk is the risk the City may face should interest rate variances affect the fair value of
investments. In accordance with its investment policy, the City manages its exposure to declines
in fair value by limiting the maturity of investments. To achieve its financial objective of
maintaining liquidity to meet all operating requirements, the City typically selects investments that
have shorter average maturities.
The following table depicts Weighted Average Maturity (WAM) for all City investments with
maturities, by number of months.
Credit Risk
State law and the City investment policy limit investments to those authorized by State Statute.
The City of Pasco holds investments in U.S. Government Agency Securities , the Local
Government Investment Pool (LGIP) and demand deposits at U.S. Bank. The investment policy
for “credit risk” does not extend beyond the types of authorized investments and the concentration
of credit risk described below. As of December 31, 2018 the City’s investments in agency
securities were all rated AAA. The LGIP is not registered with the SEC and the fair value of the
city’s position in the pool is the same as the value of the pool shares. The LGIP is regulated by the
state of Washington’s state finance committee. Credit risk is limited as most investments are either
obligations of the U.S. Government, government sponsored enterprises, insured demand deposit
accounts or certificates of deposit.
Concentration of Credit Risk
Concentration of credit risk is the risk of loss attributed to the magnitude of a government’s
investment in a single issuer. It is the policy of the city to diversify its investment portfolio to
eliminate the risk of loss resulting from overconcentration of assets in a specific class of securities.
The table below identifies the types of investments, concentration of investments in any one issuer,
and maturities of the City's investment portfolio as of December 31, 2018.
Maturity Date
# of Months to
Maturity
Fair Market
Value as
12/31/18 % of total WAM
02/01/2027 97 91,189$ 0.53%0.512486
03/08/2019 3.0 998,264 5.78%0.173515
06/13/2019 6.0 1,988,938 11.52%0.691421
09/26/2019 9.0 2,025,378 11.73%1.056134
10/15/2019 10.0 2,086,248 12.09%1.208749
07/15/2020 19.0 2,060,995 11.94%2.268825
10/15/2020 22.0 2,030,336 11.76%2.587979
01/15/2021 24.0 3,038,098 17.60%4.224578
12/06/2021 35.0 2,940,114 17.03%5.962144
25.0 17,259,560$ 100.00%18.685832
Calculation of Weighted Average Maturity (WAM)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Local Government Investment Pool
The city is a participant in the Local Government Investment Pool was authorized by Chapter 294,
Laws of 1986, and is managed and operated by the Washington State Treasurer. The State Finance
Committee is the administrator of the statute that created the pool and adopts rules. The State
Treasurer is responsible for establishing the investment policy for the pool and reviews the policy
annually and proposed changes are reviewed by the LGIP advisory Committee.
Investments in the LGIP, a qualified external investment pool, are reported at amortized cost which
approximates fair value. The LGIP is an unrated external investment pool. The pool portfolio is
invested in a manner that meets the maturity, quality, diversification and liquidity requirements set
forth by the GASBS 79 for external investments pools that elect to measure, for financial reporting
purposes, investments at amortized cost. The LGIP does not have any legally binding guarantees
of share values. The LGIP does not impose liquidity fees or redemption gates on participant
withdrawals. For GASB reporting purposes funds in the LGIP are reported as cash equivalents.
The Office of the State Treasurer prepares a stand-alone LGIP financial report. A copy of the
report is available from the Office of the State Treasurer, PO Box 40200, Olympia, Washington
98504-0200, online at http://www.tre.wa.gov.
Investments Reported as Cash Equivalents as of December 31, 2018
Amortized Cost Less than 1 Year
Local Government Investment Pool $40,121,642 $40,121,642
Investment Type Fair Value
Less than 1
year 1 to 5 years
% of Total
Portfolio
SBA Participation 91,189$ 91,189$ -$ 0.53%
Federal Farm Credit Bank 2,940,114 - 2,940,114 17.03%
Federal Home Loan Bank 998,264 998,264 - 5.78%
FICO Strips 2,025,378 2,025,378 - 11.73%
Federal National Mortgage Association 1,988,938 1,988,938 - 11.52%
Resolution Funding Corporation 2,086,248 2,086,248 - 12.09%
Resolution Funding Corporation-Strips 7,129,430 - 7,129,430 41.31%
Total Investments 17,259,560$ 7,190,017$ 10,069,544$ 100.00%
41.66%58.34%100.00%
Maturities
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
51
In addition to the City of Pasco investments presented in the series of tables following this section,
the City’s Old Fire Pension and Old Fire OPEB Funds report the following investments in their
Trust Funds:
Investments Measured at Fair Value
The City measures and reports investments at fair value using the valuation input hierarchy
established by Generally Accepted Accounting Principles (GAAP), as follows:
Level 1: Quoted prices in active markets for identical assets or liabilities;
Level 2: These are quoted market prices for similar assets or liabilities, quoted prices for
identical or similar assets or liabilities in markets that are not active, or other than quoted prices
that are not observable;
Level 3: Unobservable inputs for an asset or liability.
Safekeeping for the City’s investments is provided by U.S. Bank. U.S. Bank contracts with
Independent Directors Council (IDC) to provide fair market values of investments on a monthly
basis. The pricing methodology varies depending on multiple components, including if an
investment is being actively traded. In depth pricing methodology is available from IDC.
As of December 31, 2018, the City had the following investments measured at fair value:
Old Fire Pension Trust Fund Investments FMV 12/31/18 Interest Rate Maturity
Small Business Admn Participation SBAP 19,367.84$ 5.37%10/1/2026
The Investment Co. of America Mutual Funds 2,084,822.64 *Varies N/A
Total 2,104,190.48$
*YTD Return 19.74%
Old Fire OPEB Trust Fund Investments FMV 12/31/18 Interest Rate Maturity
WAMU Investors Fund A Mutual Funds 2,844,173.80 *Varies N/A
Total 2,844,173.80$
*YTD Return 20.19%
12/31/2018
Quoted prices
active markets for
identical asset
(level 1)
Significant other
observable
inputs (level 2)
Significant
unobservable
inputs (level 3)
Investment by fair value level
U.S. Government agency securities 17,259,560$ 17,259,560$
Total investment measured at fair value 17,259,560
Total investment in statement of net position 17,259,560$
Fair Value Measurement
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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NOTE 4: PROPERTY TAX
Property Taxes. The county treasurer acts as an agent to collect property taxes levied in the county
for all taxing authorities. Collections are distributed by the 10th day of the following month.
Property taxes are recorded as a receivable when levied, offset by deferred revenue. During the
year property tax revenues are recognized when cash is collected and deferred property tax revenue
is reduced. The amount of taxes receivable at year-end that would be collected soon enough to be
available to pay liabilities of the current period is immaterial. Property tax collected in advance of
the fiscal year to which it applies is recorded as a deferred inflow and recognized as revenue of the
period to which it applies. No allowance for uncollectible tax is established because delinquent
taxes are considered fully collectible. Prior year tax levies were recorded using the same principle
and delinquent taxes are evaluated annually. The reported balances include tax payments from the
county received through December 31, 2018. Delinquent taxes totaled $175,599 and since these
funds are not available, revenue recognition is deferred. Subsequent collections of delinquent
amounts will be recorded in revenue in the period actually received.
The City may levy up to $3.60 per $1,000 of assessed valuation for general governmental services
subject to two limitations:
a. Chapter 84.55.010 of the Revised Code of Washington limits the growth of non-voted
property taxes to the lesser of 1% per year, or the Implicit Price Deflator. Adjustments
for new construction and annexations are excluded from this calculation.
b. The Washington State Constitution limits the total regular property taxes to one percent
of assessed valuation or $10 per $1,000 of value. If the taxes of all districts exceed this
amount, each is proportionately reduced until the total is at or below the one percent
limit.
The City’s regular levy for 2018 was $1.7457 per $1,000 on an assessed valuation of
$4,800,880,942. This resulted in a total regular levy of $8,380,928 for 2018. The City did not levy
any taxes for special levies in 2018.
January 1 Taxes are levied and become an enforceable lien against properties.
February 14 Tax bills are mailed.
April 30 First of two equal installment payments is due.
May 31 Assessed value of property established for next year's levy at 100% of market value.
October 31 Second installment is due.
Property Tax Calendar
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
53
NOTE 5: CAPITAL ASSETS AND CWIP
Capital asset activity for the year ended December 31, 2018 was as follows:
Governmental Activities:
Beginning
Balance
01/01/18
Prior Period
Adjustments
Beginning
Balance
01/01/18
Current Period
Increases
Current Period
Decreases
Ending Balance
12/31/18
Capital assets, not being depreciated
Land 16,831,768$ -$ 16,831,768$ 644,999$ 140,212$ 17,336,555$
Construction in progress 12,717,587 (43,920) 12,673,667 10,135,657 7,070,558 15,738,767
Total capital assets, not being depreciated 29,549,355 (43,920) 29,505,435 10,780,656 7,210,770 33,075,322
Capital assets, being depreciated:
Building & structure 48,586,977 - 48,586,977 2,092,063 - 50,679,040
Other improvements 10,013,695 - 10,013,695 - 32,124 9,981,571
Machinery and equipment 17,706,390 - 17,706,390 1,982,965 451,880 19,237,475
Infrastructure 262,722,270 - 262,722,270 27,768,310 19,213,916 271,276,664
Total capital assets being depreciated 339,029,332 - 339,029,332 31,843,338 19,697,920 351,174,750
Less accumulated depreciation:
Building & structure 17,064,036 - 17,064,036 1,077,845 - 18,141,881
Other improvements 6,850,917 - 6,850,917 270,889 32,124 7,089,682
Machinery and equipment 9,015,366 - 9,015,366 1,234,144 451,880 9,797,630
Infrastructure 108,631,907 - 108,631,907 14,070,104 19,213,916 103,488,095
Total accumulated depreciation 141,562,226 - 141,562,226 16,652,982 19,697,920 138,517,288
Total capital assets, being depreciated, net 197,467,106 - 197,467,106 15,190,356 - 212,657,462
Governmental activities capital assets net 227,016,461$ (43,920)$ 226,972,541$ 25,971,012$ 7,210,770$ 245,732,784$
Business Type Activities:
Beginning
Balance
01/01/18
Current Period
Increases
Current Period
Decreases
Ending Balance
12/31/18
Capital assets, not being depreciated
Land 2,830,911$ 314,200$ 43,900$ 3,101,211$
Construction in process 10,310,773 5,778,508 2,439,353 13,649,928
Total capital assets, not being depreciated 13,141,684 6,092,708 2,483,253 16,751,139
Capital assets, being depreciated:
Building & structure 79,224,661 1,374,364 16,893,916 63,705,109
Other Improvements 198,090 - - 198,090
Machinery and equipment 12,811,758 724,389 323,790 13,212,357
Infrastructure 174,421,198 5,739,753 8,336,876 171,824,075
Total capital assets being depreciated 266,655,707 7,838,506 25,554,582 248,939,631
Less accumulated depreciation:
Building & structure 45,223,775 2,242,071 16,893,917 30,571,929
Other Improvements 1,139 3,962 - 5,101
Machinery and equipment 5,768,655 1,127,384 322,995 6,573,044
Infrastructure 44,497,208 3,914,056 8,190,187 40,221,077
Total accumulated depreciation 95,490,777 7,287,473 25,407,099 77,371,151
Total capital assets, being depreciated, net 171,164,930 551,033 147,483 171,568,480
Business activities capital assets net 184,306,614$ 6,643,740$ 2,630,736$ 188,319,619$
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
54
Depreciation expense by function:
Construction commitments
The City of Pasco has active construction projects as of December 31, 2018. The projects include
street construction and various utility related projects. At year end, the city’s commitments with
contractors are as follows:
NOTE 6: INTERFUND BALANCES AND TRANSFERS
Inter-fund loans
The composition of inter-fund loan balances as of December 31, 2018 are presented in the
following table. These loans are included in the Fund Financial Statements but eliminated from the
Government Wide Statement of Net Assets because they are internal borrowings. There are also
one day loans from the General Fund totaling $3,628,354 for funds with negative cash at year end
that are classified as Due from transactions on the Balance Sheet Governmental Funds. The
composition of Due to and Due from balances as of December 31, 2018 are presented in the
following table.
General government 426,987$
Public Safety 841,763
Transportation 14,184,824
Economic environment 230,420
Culture & recreation 968,988
Total depreciation expense - governmental activities 16,652,982$
Water 2,793,341$
Irrigation 579,675
Sewer 3,220,898
Process water reuse facility 488,984
Stormwater 204,575
Total depreciation expense- business-type activities:7,287,473$
Governmental activities:
Business-type activities:
CATEGORY PROJECT NAME SPENT TO DATE REMAINING
COMMITMENT
Process Water Resource Facility Columbia East Pump Station 264,703$ 2,405,049$
Water East Side Booster Station 843,524 21,720
Street Argent Road Widening 378,907 28,748
Street Oregon Ave Corridor 5,619,394 1,164,642
Street Traffic Signal Improvments 1,398,817 10,980
Street Road 68 Interchange 147,696 162,853
Water Columbia Water Supply 7,665,120 191,432
Sewer Wastewater Treatment Plant Controls Upgrade 265,894 548,278
Economic Development Process Water Resource Facility Plan 702,002 205,942
Process Water Resource Facility Irrigation Pump Station Building 150,914 11,726
17,436,971$ 4,751,371$ TOTAL
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
55
Inter-fund transfers
Transfers between funds during the year ended December 31, 2018 are as follows:
`
Transfers are used to 1) move unrestricted general fund revenues to finance various programs that
the government must account for in other funds in accordance with budgetary authorizations,
including amounts provided as subsidies or matching funds for various grant programs; 2) move
investment earnings or operating subsidies from one fund to its designated, authorized purpose
carried out by another fund; 3) move resources designated for construction to and from
construction funds as projects are created and/or completed.
There were one time transfers for the purpose of construction between several special revenue
funds, the general fund and the construction funds. The construction fund transferred to fund 960
Animal Control (External Organization) to move Animal Control related charges to the correct
fund. The construction fund transferred to fund 194 as a correction in funding source related to the
Chapel Hill. There were on-going transfers to move grant support from the Community
Development Block Grant fund to the general fund for qualified grant activities; and from the
general fund to the ambulance fund.
Loan Purpose
Nonmajor Special
Revenue
Nonmajor Debt
Service Total
General Fund GEMT Retro-Interim Financing $ 2,000,000 $ - 2,000,000$
Nonmajor Special Revenue LID Financing - 106,971 106,971
Nonmajor Fiduciary LID Financing - 18,330 18,330
-$ 125,301$ 2,125,301$
INTERFUND LOANS DUE FROM
TotalINTERFUND LOANS DUE TO General Fund Total
Nonmajor Special Revenue $ 762,670 762,670$
Major Construction 2,840,684 2,840,684
External Organization 25,000 25,000
Total 3,628,354$ 3,628,354$
DUE FROM
DUE TO General Nonmajor Special
Revenue
Major
Construction
Internal
Service Total
General -$ 236,333$ -$ -$ 236,333$
Nonmajor Special Revenue 725,000 48,927 56,004 - 829,931
Major Construction 198,903 2,133,574 - - 2,332,477
Internal Service - - - 75,000 75,000
External Organization - 47,563 30,663 - 78,226
Total 923,903$ 2,466,397$ 86,667$ 75,000$ 3,551,967$ TRANSFER TOTRANSFER FROM
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
56
NOTE 7: CHANGES IN LONG-TERM LIABILITIES
Changes in long-term liabilities -governmental. The City liquidates most governmental debt
service from the General Fund while compensated absences are generally liquidated from General,
Street and Ambulance funds. The average percentage of usage of compensated absences varies
significantly between governmental and business type funds, therefore the City uses a three-year
average usage percentage for projecting compensated absences due within one year. This method
is the most accurate by following the current trend for of each type of funds. Internal service funds
predominantly serve the governmental funds and their long-term liabilities are included as part of
the totals for governmental activities. In 2018 liabilities for Internal Service Funds included with
Governmental activities was $124,371.
The table below reflects the change in Long-Term Liabilities for Governmental activities for year
ended December 31, 2018.
Changes in long-term liabilities – business type. All business type funds liquidate their own
compensated absences, judgements, and claims.
The table below reflects the change in Long-Term Liabilities for Business Type activities for year
ended December 31, 2018.
GOVERNMENTAL ACTIVITIES
Beginning Balance
01/01/2018 Additions Reductions
Ending Balance
12/31/18
Due Within One
Year
General Obligation Bonds 9,660,000$ -$ (795,000)$ 8,865,000$ 830,000$
Premiums 276,960 - (15,387) 261,573 15,387
Total GO Bonds Payable 9,936,960 - (810,387) 9,126,573 845,387
Special Assessment Bond 20,000 - (20,000) - -
Compensated Absences 2,712,101 2,160,127 (1,908,130) 2,964,098 2,261,050
Health and Welfare Claims
OPEB Obligations 16,179,101 44,194 - 16,223,295 -
Pension Obligations 6,634,394 - (1,963,472) 4,670,922 -
Governmental Activity Long-Term Activity 35,482,556$ 2,204,321$ (4,701,989)$ 32,984,888$ 3,106,437$
BUSINESS TYPE ACTIVITIES
Beginning Balance
01/01/2018 Additions Reductions
Ending Balance
12/31/18
Due Within One
Year
Revenue Bonds 42,515,000$ -$ (1,760,000)$ 40,755,000$ 2,045,000$
LTGO Bonds 2,270,585 - (1,127,599) 1,142,986 1,142,986
Premiums 1,974,455 - (123,486) 1,850,969 121,541
Total Bonds Payable 46,760,040 - (3,011,085) 43,748,955 3,309,527
State Loans 6,300,340 737,344 (465,843) 6,571,841 505,508
External Loan - 1,500,000 (68,534) 1,431,466 121,754
Compensated Absences 245,882 234,912 (256,398) 224,396 216,161
Pension Obligations 2,499,875 (922,817) 1,577,058 -
Business Activity Long-Term Activity 55,806,137 2,472,256 (4,724,677) 53,553,716 4,152,950
Total Changes in Business Type &
Governmental Long-Term Liabilities 91,288,693$ 4,676,577$ (9,426,666)$ 86,538,604$ 7,224,388$
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
57
NOTE 8: LONG TERM DEBT
The City issues general obligation bonds to finance capital improvements such as street projects,
softball fields, library improvements, police station and other municipal facilities. Revenue bonds
are issued to finance capital facilities, facility improvements and equipment purchases for the
City’s utilities. General obligation bonds have been issued for both general government and
business-type activities. Governmental debt is considered obligations of the general government
and is repaid with general governmental resources. Proprietary fund revenues are used to repay
revenue and refunding bonds as well as certain loans to proprietary funds. Bonded indebtedness
has also been entered into to advance refund general obligation and revenue bonds.
Governmental Debt
The City’s outstanding general obligation bonds are comprised of 2011 refunding bonds and a
2015 bond issue that funded the construction of a new police station. A Public Safety Sales tax of
three-tenths of one percent, implemented in 2012 was identified as the source of repayment of the
bonds. These issues are repaid from the General Fund.
General obligation bonds outstanding as of December 31, 2018 are as follows:
Special Assessment Debt
The LID Guarantee Fund ended the year with a balance of $339,481.
The annual debt service requirements to maturity for general obligation bonds is presented in the
following table.
Purpose Issuance Amount Final Maturity Interest Rates
Outstanding as of
December 31, 2018
Due Within 1
Year
2011 LTGO Refunding 2001 LTGO 4,110,000$ 12/1/2020 3.00%-4.00%1,005,000$ 495,000
2015 LTGO Police Station 8,795,000$ 12/1/2035 3.00%-4.00%7,860,000 335,000
8,865,000$ 830,000$ Total Governmental Debt
GOVERNMENTAL DEBT - BONDS
GOVERNMENTAL DEBT
Year Ending
December 31 Principal Interest Total Debt Service
2019 830,000$ 339,900$ 1,169,900$
2020 860,000 306,700 1,166,700
2021 360,000 272,300 632,300
2022 375,000 257,900 632,900
2023 390,000 242,900 632,900
2024-2028 2,200,000 967,300 3,167,300
2029-2033 2,650,000 521,063 3,171,063
2034-2035 1,200,000 67,875 1,267,875
TOTAL 8,865,000$ 2,975,938$ 11,840,938$
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
58
Business Type Debt
In 2018 the City’s Water/Sewer utility continued the construction of projects supported by a $9.4
million revenue bond that was issued at the end of 2017. The purpose of the bond was to provide
funding and reimbursement for multiple sewer capital projects. The projects include upgrades and
replacement of several sewer lift stations, treatment plant upgrades, relining projects and certain
immediate needs projects identified by staff and consultants. These bonds will be repaid from
revenues from the Water/Sewer utility. The City is also liable for two state loans; 1) Public Works
trust fund loan secured for the Riverview Trunk Sewer Intercept project that will be satisfied in
2020, and 2) Drinking Water Loan for the Columbia Water Supply Project. The Columbia Water
Supply Project was completed in 2018. The final draw against the loan, which is paid on a
reimbursement basis, is anticipated to be received in 2019 in conjunction with the final close out
of the loan process.
As of December 31, 2018, restricted cash and investments in the proprietary funds contain
$4,203,900 in sinking funds and reserves as required by bond indentures.
Revenue Bonds, General Obligation Bonds and Loans outstanding for Business Type Accounts
are as follows:
Purpose Issuance Amount Final Maturity Interest Rates
Outstanding as of
December 31, 2018
Due Within 1
Year
2009 Water/Sewer Capital Projects 10,045,000$ 05/01/2029 1.35%-4.75%6,010,000$ 495,000$
2010A Refunding Water/Sewer 9,070,000 06/01/2029 3.00%-5.00%4,185,000 305,000
2013A Sewer Capital Projects 2,520,000 12/01/2028 3.00%-4.00%2,020,000 170,000
2013T Capital Projects Reuse Facility 7,235,000 12/01/2028 .69%-4.89%5,480,000 460,000
2015 Water/Sewer Capital Projects 14,380,000 12/01/2040 2.00%-5.00%13,645,000 615,000
2016 Sewer Refunding LTGO Bond-pay SRF Loan 3,959,939 07/31/2019 1.36%1,142,986 1,142,986
2017 Sewer Improvement Revenue Bonds1 9,415,000$ 12/01/2042 3.30%-4.00%9,415,000 -
41,897,986$ 3,187,986$
Purpose Issuance Amount Final Maturity Interest Rates
Outstanding as of
December 31, 2018
Due Within 1
Year
PW00-691-043 Riverview Trunk Sewer Interceptor 1,890,000$ 06/30/2020 0.50%222,281$ 111,140$
DM15-952-037 Columbia Water Supply Project2 6,810,430 10/01/2034 1.50%6,349,559 394,368
HAEIFAC - Reuse Facility Improvement Loan 1,500,000$ 07/01/2028 3.20%1,431,466 121,754
8,003,306 627,263
49,901,292$ 3,815,249$
1 This bond requires interest-only payments until 2030.
Total Business Type Debt
2The Columbia Water Supply Project Loan is approved for $6,810,430 and has recorded draws of $6,068,700 through December 31, 2018.
BUSINESS TYPE DEBT -BONDS
BUSINESS TYPE DEBT -LOANS
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
59
The debt service requirements to maturity for all Business Type debt is as follows:
For financial statement presentation the City’s non-current portion of bonds payable are presented
net of premium while current bonds payable reflect actual principal payments due within one year.
The following table illustrates the breakdown by fund for current and non-current bonds payable
and the effect of premium on balances. Balances shown are as of December 31, 2018.
Operating leases. The city leases its front-line police vehicles. Leases are generally for a three-
year period. Generally, at the end of the three-year period the lease ends and the city returns the
vehicles. New vehicles and leases are then acquired. Total cost for such leases was $521,536 for
the year ended December 31, 2018. The following represents the future annual minimum lease
payments:
BUSINESS TYPE DEBT
Year Ending
December 31 Principal Interest Total Debt Service
2019 3,815,249$ 1,898,281$ 5,713,530$
2020 2,748,121 1,797,146 4,545,267
2021 2,661,206 1,704,350 4,365,556
2022 2,365,459 1,605,896 3,971,355
2023 2,379,849 1,516,949 3,896,798
2024-2028 12,380,533 6,135,842 18,516,375
2029-2033 8,076,842 4,114,561 12,191,403
2034-2038 8,034,368 2,473,091 10,507,459
2039-2042 7,400,000 685,510 8,085,510
TOTAL 49,861,627$ 21,931,626$ 71,793,253$
Bonds Business Type Governmental Total
Current Bonds Payable 3,187,986$ 830,000$ 4,017,986$
Non Current -Bonds Payable 38,710,000 8,035,000$ 46,745,000
Bond Premium 1,729,429 246,186 1,975,615
Total Non Current Bonds Payable, plus Premium 40,439,429 8,281,186 48,720,615
Total Bonds Payable at 12/31/18 43,627,415$ 9,111,186$ 52,738,601$
Year Ending December Amount
2019 456,148$
2020 314,529
2021 269,764
2022 159,252
Total 1,199,693$
Police vehicles
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
60
NOTE 9: RISK MANAGEMENT
The City of Pasco maintains insurance against most normal hazards except for unemployment and
automobile collision, where it has elected to become self-insured.
For unemployment claims, the City is on a 100% reimbursable program with the Sta te where the
City pays all unemployment claims charged against it.
The City of Pasco is a member of the Washington Cities Insurance Authority (WCIA). Utilizing
Chapter 48.62 RCW (self-insurance regulation) and Chapter 39.34 RCW (Interlocal Cooperation
Act), nine cities originally formed WCIA on January 1, 1981. WCIA was created for the
purpose of providing a pooling mechanism for jointly purchasing insurance, jointly self-insuring,
and / or jointly contracting for risk management services. WCIA has a total of 160 members.
New members initially contract for a three-year term, and thereafter automatically renew on an
annual basis. A one-year withdrawal notice is required before membership can be terminated.
Termination does not relieve a former member from its unresolved loss history incurred during
membership.
Liability coverage is written on an occurrence basis, without deductibles. Coverage includes
general, automobile, police, errors or omissions, stop gap, employment practices and employee
benefits liability. Limits are $4 million per occurrence in the self-insured layer, and $16 million
in limits above the self-insured layer is provided by reinsurance. Total limits are $20 million per
occurrence subject to aggregates and sublimits. The Board of Directors determines the limits
and terms of coverage annually.
Insurance for property, automobile physical damage, fidelity, inland marine, and boiler and
machinery coverage are purchased on a group basis. Various deductibles apply by type of
coverage. Property coverage is self-funded from the members’ deductible to $750,000, for all
perils other than flood and earthquake, and insured above that to $300 million per occurrence
subject to aggregates and sublimits. Automobile physical damage coverage is self-funded from
the members’ deductible to $250,000 and insured above that to $100 million per occurrence
subject to aggregates and sublimits.
In-house services include risk management consultation, loss control field services, and claims
and litigation administration. WCIA contracts for certain claims investigations, consultants for
personnel and land use issues, insurance brokerage, actuarial, and lobbyist services.
WCIA is fully funded by its members, who make annual assessments on a prospectively rated
basis, as determined by an outside, independent actuary. The assessment covers loss, loss
adjustment, reinsurance and other administrative expenses. As outlined in the interlocal, WCIA
retains the right to additionally assess the membership for any funding shortfall.
An investment committee, using investment brokers, produces additional revenue by investment
of WCIA’s assets in financial instruments which comply with all State guidelines.
A Board of Directors governs WCIA, which is comprised of one designated representative from
each member. The Board elects an Executive Committee and appoints a Treasurer to provide
general policy direction for the organization. The WCIA Executive Director reports to the
Executive Committee and is responsible for conducting the day to day operations of WCIA.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
61
The City is self-insured for medical and dental coverage for its employees. A third party
administrator, Benefits Management, Inc., processes all claims for reimbursement. The third party
administrator provides utilization management services and requires pre-authorization for all non-
emergency hospital confinements. The City currently maintains four months (16 weeks) of
program expense in cash reserves for medical and dental claims. Program expense includes average
claims as well as administrative and third party provider costs. To limit the exposure for large
claims, the City purchases individual stop-loss coverage from a commercial insurance carrier that
limits the City's exposure for claim losses to $100,000 per individual. The amount of
medical/dental claims in excess of commercial insurance for the last three years are:
NOTE 10: JOINT AGREEMENT/JOINT VENTURES
A. Bi-County Police Information Network
The Bi-County Police Information Network (BI-PIN) was established November 24, 1982, when an
Interlocal Agreement was entered into by eight participating municipal corporations; the cities of
Kennewick, Pasco, Richland, Connell, West Richland, and Prosser, and Benton and Franklin
Counties. BI-PIN established to assist the participating police and sheriff's departments in the
deterrence and solution of criminal incidents. BI-PIN served by an Executive Committee composed
of the City Manager of each of the cities and a member from each of the Boards of County
Commissioners of Benton and Franklin Counties. A liaison from the Bi-County Chiefs and Sheriffs
is an ex officio, non-voting member.
The allocation of financial participation among the participating jurisdictions based upon the
approved budget for that year and billed quarterly in advance to each agency. On dissolution of the
Interlocal Agreement, the net position shared based upon participant contribution.
Effective January 1, 1992, the City of Kennewick assumed responsibility for operation of the BI-PIN
system. As the Operating Jurisdiction, Kennewick provides all necessary support services for the
operation of BI-PIN such as accounting, legal services, and risk management and information
systems.
BI-PIN is currently in the process of implementing a new RMS/JMS system as well as upgrading all
supporting infrastructure. The City of Pasco's equity interest in BI-PIN was $154,965 on Dec 31,
2018, which is reported as an investment in joint ventures in the government-wide statement of net
position. The change in equity is reflected in the government-wide statement of activities under
Public Safety. The City does not anticipate any income distributions from BI-PIN since charges are
assessed only to recover anticipated expenses.
Complete separate financial statements for BI-PIN obtained at the City of Kennewick, 210 W. 6th
Ave., Kennewick, Washington, 99336.
2016 2017 2018
$4,858,665 $4,463,350 $5,196,581
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
62
B. Metro Drug Forfeiture Fund
The Metropolitan Controlled Substance Enforcement Group (Metro) established prior to 1987, when
Interlocal Agreement entered into by six participating municipal corporations, the cities of
Kennewick, Pasco, Richland, and West Richland, and Benton and Franklin Counties. Metro
established to account for the proceeds of forfeitures, federal grants, and court ordered contributions,
and to facilitate the disbursement of those proceeds for the purpose of drug enforcement and
investigations. Metro served by an Executive Committee composed of the City Manager or designee
of each of the cities and a member from each of the Boards of County Commissioners of Benton and
Franklin Counties. In addition, a Governing Board consisting of the Chiefs of Police from the cities
and the Sheriffs from the counties administers daily activity.
Effective July 1, 2009, the City of Kennewick assumed responsibility for the operation of Metro. As
the Operating Jurisdiction, Kennewick provides accounting services for the operation of Metro.
The City of Pasco's equity interest in Metro was $15,600 on Dec 31, 2018, which reported as an
investment in joint ventures in the government-wide statement of net position. The change in equity
is reflected in the government-wide statement of activities under Public Safety. The City does not
anticipate any income distributions from Metro.
Complete separate financial statements for Metro obtained at the City of Kennewick, 210 West Sixth
Avenue, Kennewick, Washington.
C. SECOMM
SECOMM provides public safety communications services to the Cities of Kennewick,
Richland, Pasco and the Counties of Benton and Franklin. Each owns an equal share of
SECOMM’s net assets. Financial participation is allocated among the five participants based
on equal shares of capital expenses, predetermined fixed costs, direct costs and percentages
of use. SECOMM also provides service through contracts to the Cities of West Richland
and Prosser, Connell and the Benton and Franklin County Fire Protection Districts, Port of
Pasco, Walla Walla Fire District #5 and the North Franklin County Hospital district.
Service contract agencies are assessed on a cost per capita or cost per call basis. The City of
Pasco’s equity interest in SECOMM as of December 31, 2018 was $973,778 which is
reported as an asset in the government-wide Statement of Net Assets. The change in equity
is reflected in Public Safety under the government-wide Statement of Activities. Upon
dissolution of the Interlocal Agreement, the net assets will be shared equitably among the
participants.
Complete and separate financial statements for all operations of Benton County
Emergency Services may be obtained at the City of Richland, 505 Swift Blvd, Richland,
Washington.
D. Tri-City Animal Control Authority
In 2005 the city entered into an interlocal agreement with the cities of Kennewick and
Richland to jointly fund the operations of the Animal Control Authority (ACA). The ACA
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
63
was established to provide animal control and sheltering services. ACA is served by an
Executive Committee composed of the City Manager, or designee, of each of the cities.
In 2005, the City of Pasco was designated as the Operation Jurisdiction for the ACA. As
the Operating Jurisdiction, the City provides all necessary support services for the operation
such as accounting, contract administration and risk management.
Complete separate financial statements for ACA may be obtained from the City of Pasco,
P.O. Box 293, Pasco, Washington 99301.
NOTE 11: RELATED PARTIES/ORGANIZATIONS
Pasco Public Facility District
Pursuant to RCW 35.57 (the “City PFD Act”) the Pasco Public Facilities District was formed and
created by Ordinance No. 3558 on July 15, 2002, coextensive with the boundaries of the City, with
the powers and authority set forth in the City PFD Act. The District was established for the purpose
of acquiring, constructing, owning, remodeling, maintaining, equipping, re-equipping, repairing,
financing, operating one or more Regional Centers, as defined by the RCW 35.57.020 and/or
participating with any other qualified public facilities district in a cooperative and joint
development of a Regional Center in the Tri-Cities area by interlocal agreement.
The members of the board of directors of the District (the “PFD Board”) shall be selected and
appointed by the Council, as required by the RCW. The PFD Board consisted of five members.
Three of the members will be appointed based on recommendations from local organizations. The
members serve four-year terms. The Council may, by resolution, remove a member for any reason.
Vacancies will be filled by appointment by the Council.
All corporate powers of the District will be exercised by or under the authority of the PFD Board;
and the business, property and affairs of the District shall be managed under the direction of the
PFD Board, except as may be otherwise provided for by law or in its Charter.
Complete separate financial statements for the District may be obtained from the City of Pasco,
P.O. Box 293, Pasco, WA 99301.
Downtown Pasco Development Authority
Pursuant to RCW 35.21, the Downtown Pasco Development Authority was formed and created by
Ordinance No. 3985 (the DPDA Act) on December 20, 2010, coextensive with the boundaries of
the City, with the powers and authority set forth in the City DPDA Act. The Authority was created
to administer and e xecute Federal grants or programs; to receive and administer private
funds, goods or services for any lawful public service; and to perform any lawful public
purpose or public function to provide for the revitalization and enhancement of the
downtown Pasco area.
The members of the board of directors of the Authority (the “DPDA Board”) are selected and
appointed by the Mayor of the City of Pasco, subject to confirmation by the City Council. The
DPDA Board consists of nine members. Five of the members are representative of for-profit
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
64
business or property owners within the downtown area. At least two members are representative
of the banking and/or real estate profession, and at least two members are representatives of
business or corporate management. The members serve four-year terms. The Council may, by
resolution, remove a member for any reason. Vacancies will be filled by appointment by the
Mayor, subject to confirmation by the City Council.
All corporate powers of the Authority will be exercised by or under the authority of the DPDA
Board; and the business, property and affairs of the Authority shall be managed under the direction
of the DPDA Board, except as may be otherwise provided by law or in its Charter.
In 2018, the City expended $197,126 in subsidies and pass-through grants to the DPDA. As part
of its charter, the DPDA was granted the right to receive the revenues generated by the Farmers’
Market and the Specialty Kitchen program. The activity from those two programs are not reflected
in the amount noted above.
Financial statements for the Authority may be obtained from the Downtown Pasco Development
Authority at 720 W. Lewis Street, Suite 131, Pasco, WA 99301.
Trade, Recreation, Agricultural Center
In 1994 the City entered into an agreement with Franklin County for the Trade, Recreatio n, and
Agricultural Center (TRAC). The City and Franklin County share in the costs of operating and
covering TRAC’s debt service. Franklin County handles all operating decisions and financial
reporting for TRAC.
The City accounts for its portion of TRAC activity in the TRAC Special Revenue Fund. For
calendar year 2018, the City of Pasco paid Franklin County $239,054 for operating expenditures.
Additionally, in 2014 the City provided $100,000 to the County to assist with TRAC’s cash flows.
This will be returned to the City in 2026, when the existing agreement lapses. It is classified on
the balance sheet as a non-current asset: Due from Other Government. As of December 31, 2018,
the TRAC Fund had a fund balance of $521,177.
Complete financial statements for TRAC may be obtained from Franklin County, 1016 N. 4th
Avenue, Pasco, Washington.
Housing Authority of the City of Pasco and Franklin County
The Housing Authority of the City of Pasco and Franklin County was formed and created by
Ordinance No. 2299 on September 8, 1981, in order to pursue the rehabilitation and redevelopment
of blighted areas containing unsanitary or unsafe habitations located within the City of Pasco and
Franklin County. Its formation empowered the joint housing authority to exercise all rights referred
to under RCW 35.82 “Housing Authority Law.”
Three of the five Authority board members are appointed by the City Council.
In 2015, the City and the Authority entered into an agreement which established Payment in Lieu
of Taxes (PILOT) to the City starting in 2015 in order to defray the cost of the City providing
essential local public services.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
65
Financial statements for the Authority may be obtained from the Housing Authority of the City of
Pasco and Franklin County, 2505 W. Lewis Street, Pasco, WA 99301.
NOTE 12: JOINTLY GOVERNED ORGANIZATIONS:
Tri-Cities Regional Public Facilities District
Pursuant to RCW 35.57 the Tri-Cities Regional Public Facilities District was formed jointly by
the Cities of Pasco, Kennewick, and Richland. The District was established for the purpose of
acquiring, constructing, owning, remodeling, maintaining, equipping, re-equipping, repairing,
financing, operating one or more Regional Centers, as defined by the
RCW35.57.020and/orparticipating with any other qualified public facilities districts in a
cooperative and joint development of a Regional Center in the Tri-Cities area, by interlocal
agreement.
The District is governed by a nine-member board, with three members representing each city.
Each member must either be a member of the City Council or the Public Facilities District of the
representative city.
Franklin County Emergency Management
Franklin County Emergency Management (FCEM) is a political subdivision of Franklin County
and its municipalities. The FCEM is responsible for coordinating and establishing emergency
response plans to prepare Franklin County for emergencies involving the following: Energy
Northwest; the Hanford Nuclear Reservation; the Pasco Airport; and all Homeland Securit y,
natural and man-made disasters
FCEM is governed by a seven-member board, with two County Commissioners, one City Manager
or designee from each of the following cities: Connell, Kahlotus, and Mesa. The City of Pasco
has two representatives on the board due to its population base.
Benton-Franklin Council of Governments
The Benton-Franklin Council of Governments (BFCG) is a voluntary association of the units of
local government, whose purpose is to facilitate a cooperative approach to regional problem
solving.
Seventeen regular voting members represent the two counties, local governments, including a
Public Utility District, a Transportation District, a Port and the Washington State Department of
Transportation. The City of Pasco has one City Council member as its voting representative on
the Board. In addition to regular voting members, there is one associate member and two affiliate
members.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
66
Benton-Franklin Council of Governments Economic Development District
The Benton-Franklin Council of Governments Economic Development District (EDD) is a
voluntary association of the units of local government and private sector members whose purpose
is to facilitate a cooperative approach to regional economic development.
The board is comprised of the members of the Benton-Franklin Council of Governments plus nine
representatives from the private sector.
Benton County Emergency Services (BCES)
BCES was formed January 1, 1997 through an interlocal agreement entered into by the Cities of
Richland, Kennewick, West Richland, Benton City and Prosser as well as Benton County. A
second amended and restated interlocal agreement was made and entered into by and between
the following entities: Benton County, Franklin County, the Cities of Kennewick, Richland,
West Richland, Prosser, Benton City, and Pasco, Benton County Fire Protection Districts and the
Public Utility District #1 of Benton County. An Executive Board oversees the operations of
BCES and consists of the City Managers (or designee) from the Cities of Kennewick, Pasco and
Richland, City Administrators from Prosser and West Richland, a Council member from Benton
City, a Benton County Commissioner, a Franklin County Commissioner and a single
representative collectively representing Benton County Fire Protection Districts. The City of
Richland serves as the operating jurisdiction providing all the necessary administrative support
services and reporting for BCES. The total amount paid by BCES in 2018 for these services was
$347,641. No distributions of income to the City are expected since charges are assessed only to
recover anticipated expenses.
NOTE 13: EMPLOYEE RETIREMENT SYSTEMS AND PENSION PLANS
The City implemented GASB Statement 68, Accounting and Financial Reporting for Pensions in
January 2015. The following table represents the aggregate pension amounts for all State plans
subject to the requirements of the GASB Statement 68, Accounting and Financial Reporting for
Pensions for the year 2018.
The following table represents the aggregate pension amounts for all plans for the year 2018:
Pension Liabilities (6,247,981)$
Pension Assets 12,171,481
Deferred Outflows of Resources 2,844,380
Deferred Inflows of Resources (6,678,012)
Pension Expense (584,024)$
Aggregate Pension Amounts - All Plans
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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State Sponsored Pension Plans
Substantially all the city’s full-time and qualifying part-time employees participate in one of the
following statewide retirement systems administered by the Washington State Department of
Retirement Systems, under cost-sharing, multiple-employer public employee defined benefit and
defined contribution retirement plans. The state Legislature establishes, and amends, laws
pertaining to the creation and administration of all public retirement systems.
The Department of Retirement Systems (DRS), a department within the primary government of
the State of Washington, issues a publicly available comprehensive annual financial report (CAFR)
that includes financial statements and required supplementary information for each plan. The DRS
CAFR may be obtained by writing to:
Department of Retirement Systems
Communications Unit
P.O. Box 48380
Olympia, WA 98540-8380
Or the DRS CAFR may be downloaded from the DRS website at www.drs.wa.gov.
Public Employees’ Retirement System (PERS)
PERS members include elected officials; state employees; employees of the Supreme, Appeals
and Superior Courts; employees of the legislature; employees of district and municipal courts;
employees of local governments; and higher education employees not participating in higher
education retirement programs. PERS is comprised of three separate pension plans for
membership purposes. PERS plans 1 and 2 are defined benefit plans, and PERS plan 3 is a defined
benefit plan with a defined contribution component.
PERS Plan 1 provides retirement, disability and death benefits. Retirement benefits are
determined as two percent of the member’s average final compensation (AFC) times the member’s
years of service. The AFC is the average of the member’s 24 highest consecutive service months.
Members are eligible for retirement from active status at any age with at least 30 years of service,
at age 55 with at least 25 years of service, or at age 60 with at least five years of service. Members
retiring from active status prior to the age of 65 may receive actuarially reduced benefits.
Retirement benefits are actuarially reduced to reflect the choice of a survivor benefit. Other
benefits include duty and non-duty disability payments, an optional cost -of-living adjustment
(COLA), and a one-time duty-related death benefit, if found eligible by the Department of Labor
and Industries. PERS 1 members were vested after the completion of five years of eligible service.
The plan was closed to new entrants on September 30, 1977.
Contributions
The PERS Plan 1 member contribution rate is established by State statute at 6 percent. The
employer contribution rate is developed by the Office of the State Actuary and includes an
administrative expense component that is currently set at 0.18 percent. Each biennium, the state
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
68
Pension Funding Council adopts Plan 1 employer contribution rates. The PERS Plan 1 required
contribution rates (expressed as a percentage of covered payroll) for 2018 were as follows:
* For employees participating in JBM, the contribution rate was 12.26%.
PERS Plan 2/3 provides retirement, disability and death benefits. Retirement benefits are
determined as two percent of the member’s average final compensation (AFC) times the member’s
years of service for Plan 2 and 1 percent of AFC for Plan 3. The AFC is the average of the
member’s 60 highest-paid consecutive service months. There is no cap on years of service credit.
Members are eligible for retirement with a full benefit at 65 with at least five years of service
credit. Retirement before age 65 is considered an early retirement. PERS Plan 2/3 members who
have at least 20 years of service credit and are 55 years of age or older, are eligible for early
retirement with a benefit that is reduced by a factor that varies according to age for each year
before age 65. PERS Plan 2/3 members who have 30 or more years of service credit and are at
least 55 years old can retire under one of two provisions:
With a benefit that is reduced by three percent for each year before age 65; or
With a benefit that has a smaller (or no) reduction (depending on age) that imposes stricter
return-to-work rules.
PERS Plan 2/3 members hired on or after May 1, 2013 have the option to retire early by accepting
a reduction of five percent for each year of retirement before age 65. This option is available only
to those who are age 55 or older and have at least 30 years of service credit. PE RS Plan 2/3
retirement benefits are also actuarially reduced to reflect the choice of a survivor benefit. Other
PERS Plan 2/3 benefits include duty and non-duty disability payments, a cost-of-living allowance
(based on the CPI), capped at three percent annually and a one-time duty related death benefit, if
found eligible by the Department of Labor and Industries. PERS 2 members are vested after
completing five years of eligible service. Plan 3 members are vested in the defined benefit portion
of their plan after ten years of service; or after five years of service if 12 months of that service are
earned after age 44.
PERS Plan 3 defined contribution benefits are totally dependent on employee contributions and
investment earnings on those contributions. PERS Plan 3 members choose their contribution rate
upon joining membership and have a chance to change rates upon changing employers. As
established by statute, Plan 3 required defined contribution rates are set at a minimum of 5 percent
Actual Contribution Rates Employer Employee*
January – August 2018
PERS Plan 1 7.49%6.00%
PERS Plan 1 UAAL 5.03%
Administrative Fee 0.18%
Total 12.70%6.00%
September – December 2018
PERS Plan 1 7.52%6.00%
PERS Plan 1 UAAL 5.13%
Administrative Fee 0.18%
Total 12.83%6.00%
PERS Plan 1
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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and escalate to 15 percent with a choice of six options. Employers do not contribute to the defined
contribution benefits. PERS Plan 3 members are immediately vested in the defined cont ribution
portion of their plan.
Contributions
The PERS Plan 2/3 employer and employee contribution rates are developed by the Office of the
State Actuary to fully fund Plan 2 and the defined benefit portion of Plan 3. The Plan 2/3 employer
rates include a component to address the PERS Plan 1 UAAL and an administrative expense that
is currently set at 0.18 percent. Each biennium, the state Pension Funding Council adopts Plan 2
employer and employee contribution rates and Plan 3 contribution rates. The PERS Plan 2/3
required contribution rates (expressed as a percentage of covered payroll) for 2018 were as follows:
* For employees participating in JBM, the contribution rate was 18.45% to 18.53%.
The city’s actual PERS plan contributions were $658,434 to PERS Plan 1 and $975,644 to PERS
Plan 2/3 for the year ended December 31, 2018.
Law Enforcement Officers’ and Fire Fighters’ Retirement System (LEOFF)
LEOFF membership includes all full-time, fully compensated, local law enforcement
commissioned officers, firefighters, and as of July 24, 2005, emergency medical technicians.
LEOFF is comprised of two separate defined benefit plans.
LEOFF Plan 1 provides retirement, disability and death benefits. Retirement benefits are
determined per year of service calculated as a percent of final average salary (FAS) as follows:
20+ years of service – 2.0% of FAS
10-19 years of service – 1.5% of FAS
5-9 years of service – 1% of FAS
The FAS is the basic monthly salary received at the time of retirement, provided a member has
held the same position or rank for 12 months preceding the date of retirement. Otherwise, it is the
Actual Contribution Rates Employer
2/3
Employee
2*
January – August 2018
PERS Plan 2/3 7.49%7.38%
PERS Plan 1 UAAL 5.03%
Administrative Fee 0,18%
Employee PERS Plan 3 Varies
Total 12.70%7.38%
September – December 2018
PERS Plan 2/3 7.52%7.41%
PERS Plan 1 UAAL 5.13%
Administrative Fee 0.18%
Employee PERS Plan 3 Varies
Total 12.83%7.41%
PERS Plan 2/3
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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average of the highest consecutive 24 months’ salary within the last ten years of service. Members
are eligible for retirement with five years of service at the age of 50. Other benefits include duty
and non-duty disability payments, a cost-of living adjustment (COLA), and a one-time duty-related
death benefit, if found eligible by the Department of Labor and Industries. LEOFF 1 members
were vested after the completion of five years of eligible service. The plan was closed to new
entrants on September 30, 1977.
Contributions
Starting on July 1, 2000, LEOFF Plan 1 employers and employees contribute zero percent, as
long as the plan remains fully funded. The LEOFF Plan I had no required employer or employee
contributions for fiscal year 2018. Employers paid only the administrative expense of 0.18 percent
of covered payroll.
LEOFF Plan 2 provides retirement, disability and death benefits. Retirement benefits are
determined as two percent of the final average salary (FAS) per year of service (the FAS is based
on the highest consecutive 60 months). Members are eligible for retirement with a full benefit at
53 with at least five years of service credit. Members who retire prior to the age of 53 receive
reduced benefits. If the member has at least 20 years of service and is age 50, the reduction is
three percent for each year prior to age 53. Otherwise, the benefits are actuarially reduced for each
year prior to age 53. LEOFF 2 retirement benefits are also actuarially reduced to reflect the choice
of a survivor benefit. Other benefits include duty and non-duty disability payments, a cost-of-
living allowance (based on the CPI), capped at three percent annually and a one-time duty-related
death benefit, if found eligible by the Department of Labor and Industries. LEOFF 2 members are
vested after the completion of five years of eligible service.
Contributions
The LEOFF Plan 2 employer and employee contribution rates are developed by the Office of the
State Actuary to fully fund Plan 2. The employer rate includes an administrative expense
component set at 0.18 percent. Plan 2 employers and employees are required to pay at the level
adopted by the LEOFF Plan 2 Retirement Board.
Effective July 1, 2017, when a LEOFF employer charges a fee or recovers costs for services
rendered by a LEOFF 2 member to a non-LEOFF employer, the LEOFF employer must cover both
the employer and state contributions on the LEOFF 2 basic salary earned for those services.
The LEOFF Plan 2 required contribution rates (expressed as a percentage of covered payroll) for
2018 were as follows:
Employer Employee
Actual Contribution Rates 5.25%8.75%
State and local governments 0.18%
Administrative Fee 5.43%8.75%
LEOFF Plan 2
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
71
The city’s contributions to the plan were $937,526 for the year ended December 31, 2018.
The Legislature, by means of a special funding arrangement, appropriates m oney from the state
General Fund to supplement the current service liability and fund the prior service costs of Plan 2
in accordance with the recommendations of the Pension Funding Council and the LEOFF Plan 2
Retirement Board. This special funding situation is not mandated by the state constitution and
could be changed by statute. For the state fiscal year ending June 30, 2018, the state contributed
$68,152,127 to LEOFF Plan 2. The amount recognized by the City as its proportionate share of
this amount is $526,850.
Actuarial Assumptions
The total pension liability (TPL) for each of the DRS plans was determined using the most recent
actuarial valuation completed in 2018 with a valuation date of June 30, 2017. The actuarial
assumptions used in the valuation were based on the results of the Office of the State Actuary’s
(OSA) 2007-2012 Experience Study and the 2017 Economic Experience Study.
Additional assumptions for subsequent events and law changes are current as of the 2017 actuarial
valuation report. The TPL was calculated as of the valuation date and rolled forward to the
measurement date of June 30, 2018. Plan liabilities were rolled forward from June 30, 2017, to
June 30, 2018, reflecting each plan’s normal cost (using the entry-age cost method), assumed
interest and actual benefit payments.
Inflation: 2.75% total economic inflation; 3.50% salary inflation
Salary increases: In addition to the base 3.50% salary inflation assumption, salaries are
also expected to grow by promotions and longevity.
Investment rate of return: 7.4%
Mortality rates were based on the RP-2000 report’s Combined Healthy Table and Combined
Disabled Table, published by the Society of Actuaries. The OSA applied offsets to the base table
and recognized future improvements in mortality by projecting the mortality rates using 100
percent Scale BB. Mortality rates are applied on a generational basis; meaning, each member is
assumed to receive additional mortality improvements in each future year throughout his or her
lifetime.
There were changes in methods and assumptions since the last valuation.
Lowered the valuation interest rate from 7.70% to 7.50% for all systems except LEOFF 2.
For LEOFF 2 the valuation interest rate was lowered from 7.50% to 7.40%.
Lowered the assumed general salary growth from 3.75% to 3.50% for all systems.
Lowered assumed inflation from 3.00% to 2.75% for all systems.
Modified how the valuation software calculates benefits paid to remarried duty-related
death survivors of LEOFF 2 members.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Updated the trend that the valuation software uses to project medical inflation for LEOFF
2 survivors of a duty-related death, and for certain LEOFF 2 medical-related duty disability
benefits.
Discount Rate
The discount rate used to measure the total pension liability for all DRS plans was 7.4 percent.
To determine that rate, an asset sufficiency test included an assumed 7.5 percent long-term
discount rate to determine funding liabilities for calculating future contribution rate requirements.
(All plans use 7.5 percent except LEOFF 2, which has assumed 7.4 percent). Consistent with the
long-term expected rate of return, a 7.4 percent future investment rate of return on invested assets
was assumed for the test. Contributions from plan members and employers are assumed to
continue being made at contractually required rates (including PERS 2/3, PSERS 2, SERS 2/3, and
TRS 2/3 employers, whose rates include a component for the PERS 1, and TRS 1 plan liabilities).
Based on these assumptions, the pension plans’ fiduciary net position was projected to be available
to make all projected future benefit payments of current plan members. Therefore, the long-term
expected rate of return of 7.4 percent was used to determine the total liability.
Long-Term Expected Rate of Return
The long-term expected rate of return on the DRS pension plan investments of 7.4 percent was
determined using a building-block-method. In selecting this assumption, the Office of the State
Actuary (OSA) reviewed the historical experience data, considered the historical conditions that
produced past annual investment returns, and considered capital market assumptions and simulated
expected investment returns provided by the Washington State Investment Board (WSIB). The
WSIB uses the capital market assumptions and their target asset allocation to simulate future
investment returns over various time horizons.
Estimated Rates of Return by Asset Class
Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan’s target asset allocation as of June 30, 2018, are summarized in the table below. The inflation
component used to create the table is 2.2 percent and represents the WSIB’s most recent long-term
estimate of broad economic inflation.
Asset Class Target
Allocation
Fixed Income 20%1.70%
Tangible Assets 7%4.90%
Real Estate 18%5.80%
Global Equity 32%6.30%
Private Equity 23%9.30%
100%
% Long-Term Expected Real
Rate of Return Arithmetic
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
73
Sensitivity of the Net Pension Liability/(Asset)
The table below presents the city’s proportionate share of the net pension liability calculated using
the discount rate of 7.4 percent, as well as what the city’s proportionate share of the net pension
liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.4
percent) or 1-percentage point higher (8.4 percent) than the current rate.
Pension Plan Fiduciary Net Position
Detailed information about the State’s pension plans’ fiduciary net position is available in the
separately issued DRS financial report.
Pension Liabilities (Assets), Pension Expense, and Deferred Outflows of Resources and
Deferred Inflows of Resources Related to Pensions
For year ending December 31, 2018, the city reported a total pension liability of $6,247,981 and a
net pension (asset) of $(10,758,741) for its proportionate share of the net pension liabilities
(assets). The table below details these amounts by plan:
The amount of the asset reported above for LEOFF Plans 1 and 2 reflects a reduction for State
pension support provided to the City. The amount recognized by the City as its proportionate share
of the net pension asset, the related State support, and the total portion of the net pension asset that
was associated with the City were as follows:
1% Decrease Current Rate Discount 1% Increase
6.40%7.40%8.40%
PERS Plan 1 5,154,668$ 4,194,410$ 3,362,633$
PERS Plan 2/3 9,393,084 2,053,572 (3,964,010)
LEOFF Plan 1 (980,569) (1,232,308) (1,449,251)
LEOFF Plan 2 (1,266,837)$ (9,526,433)$ (16,263,093)$
Liability (or Asset)
PERS 1 $ 4,194,410
PERS 2/3 2,053,572
LEOFF 1 (1,232,308)
LEOFF 2 $ (9,526,433)
LEOFF 1 Asset LEOFF 2 Asset
Employer’s proportionate share $ (1,232,308) $ (9,526,433)
TOTAL $ (9,567,611) $ (15,694,618)
State’s proportionate share of the net pension asset
associated with the employer (8,335,303) (6,168,185)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
74
At June 30, 2018, the City’s proportionate share of the collective net pension liabilities was as
follows:
Employer contribution transmittals received and processed by the DRS for the fiscal year ended
June 30 are used as the basis for determining each employer’s proportionate share of the collective
pension amounts reported by the DRS in the Schedules of Employer and Nonemployer Allocations
for all plans except LEOFF 1.
LEOFF Plan 1 allocation percentages are based on the total historical employer contributions to
LEOFF 1 from 1971 through 2000 and the retirement benefit payments in fiscal year 2018.
Historical data was obtained from a 2011 study by the Office of the State Actuary (OSA). In fiscal
year 2018, the state of Washington contributed 87.12 percent of LEOFF 1 employer contributions
and all other employers contributed the remaining 12.88 percent of employer contributions.
LEOFF 1 is fully funded and no further employer contributions have been required since June
2000. If the plan becomes underfunded, funding of the remaining liability will require new
legislation. The allocation method the plan chose reflects the projected long-term contribution
effort based on historical data.
In fiscal year 2018, the state of Washington contributed 39.30 percent of LEOFF 2 employer
contributions pursuant to RCW 41.26.725 and all other employers contributed the remaining 60.70
percent of employer contributions.
The collective net pension liability (asset) was measured as of June 30, 201 8, and the actuarial
valuation date on which the total pension liability (asset) is based was as of June 30, 201 7, with
update procedures used to roll forward the total pension liability to the measurement date.
Pension Expense
For the year ended December 31, 2018, the city recognized pension expense as follows:
Proportionate Proportionate Change in
Plan Share 6/30/17 Share 6/30/18 Proportion
PERS 1 0.099661%0.093918%-0.005743%
PERS 2/3 0.126788%0.120274%-0.006514%
LEOFF 1 0.066934%0.067877%0.000943%
LEOFF 2 0.427714%0.469232%0.041518%
PERS 1 83,397$
PERS 2 10,567
LEOFF 1 (211,094)
LEOFF 2 (403,638)
Old Fire Pension (63,256)
TOTAL (584,024)$
Pension Expense 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
75
Deferred Outflows of Resources and Deferred Inflows of Resources
At December 31, 2018, the city reported deferred outflows of resources and deferred inflows of
resources related to pensions from the following sources:
Deferred outflows of resources related to pensions resulting from the city’s contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability
in the year ended December 31, 2018. Other amounts reported as deferred outflows and deferred
inflows of resources related to pensions will be recognized in pension expense as follows:
Deferred Outflows Deferred Inflows
of Resources of Resources
-$ -$
Net difference between projected and actual investment earnings on pension plan investments - (166,683)
-
Changes in proportion and differences between contributions and proportionate share of contributions 346,903
TOTAL 346,903$ (166,683)$
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience 251,714$ (359,543)$
Net difference between projected and actual investment earnings on pension plan investments - (1,260,167)
Changes of assumptions 24,023 (584,430)
Changes in proportion and differences between contributions and proportionate share of contributions 170,839 (270,182)
Contributions subsequent to the measurement date 511,681
TOTAL 958,257$ (2,474,322)$
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience -$ -$
Net difference between projected and actual investment earnings on pension plan investments - (100,045)
Changes of assumptions - -
Changes in proportion and differences between contributions and proportionate share of contributions
Contributions subsequent to the measurement date
TOTAL -$ (100,045)$
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience 510,312$ (221,205)$
Net difference between projected and actual investment earnings on pension plan investments - (1,667,254)
Changes of assumptions 5,393 (1,367,215)
Changes in proportion and differences between contributions and proportionate share of contributions 196,140 (509,099)
Contributions subsequent to the measurement date 488,183
TOTAL 1,200,028$ (3,764,773)$
TOTAL DEFERRED OUTFLOWS Deferred Outflows Deferred Inflows
AND INFLOWS FOR ALL PLANS of Resources of Resources
Differences between expected and actual experience 762,026$ (580,748)$
Net difference between projected and actual investment earnings on pension plan investments - (3,194,149)
Changes of assumptions 29,416 (1,951,645)
Changes in proportion and differences between contributions and proportionate share of contributions 366,979 (779,281)
Contributions subsequent to the measurement date 1,346,767 -
TOTAL 2,505,188$ (6,505,823)$
PERS 1
Differences between expected and actual experience
Changes of assumptions
PERS 2/3
LEOFF 1
LEOFF 2
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
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Firemen's Pension
The following table represents the aggregate pension amounts for the Firemen’s’ Pension
Fund, subject to the requirements of GASB Statement 68 for the year 2018.
Plan Description
Plan Administration: The Firemen’s’ Pension Fund (FPF) is administered by the City of Pasco.
The plan is a single-employer defined benefit pension plan that provides pensions for
firefighters that were hired prior to 1970.
The municipal firefighters' pension board consists of the following five members, ex officio,
the mayor, or in a city of the first class, the mayor or a designated representative who shall be
an elected official of the city, who shall be chairperson of the board, the city comptroller or
clerk, the chairperson of finance of the city council, or if there is no chairperson of finance, the
city treasurer, and in addition, two regularly employed or retired firefighters elected by secret
ballot of those employed and retired firefighters who are subject to the jurisdiction of the board.
The members to be elected by the firefighters shall be elected annuall y for a two-year term.
The two firefighters elected as members shall, in turn, select a third eligible member who shall
serve as an alternate in the event of an absence of one of the regularly elected members. In case
a vacancy occurs in the membership of the firefighters or retired members, the members shall
in the same manner elect a successor to serve the unexpired term. The board may select and
appoint a secretary who may, but need not be a member of the board. In case of absence or
inability of the chairperson to act, the board may select a chairperson pro tempore who shall
during such absence or inability to perform the duties and exercise the powers of the
chairperson. A majority of the members of the board shall constitute a quorum and have power
to transact business.
Plan Membership: Plan membership is limited to active members of the Firefighters' Pension
Fund (FPF) as of March 1, 1970. On that date, the Washington Law Enforcement Officers' and
Firefighters' System (LEOFF) was established. FPF is responsible for paying the pensions of
those members retired prior to March 1, 1970 and for providing the "excess benefit", the excess
Year ended
December 31:PERS 1 PERS 2/3 LEOFF 1 LEOFF 2 Total
2019 $ 7,292 $ (211,457) $ 96 $ (253,727) $ (457,796)
2020 (36,438) (557,736) (22,569) (506,159) (1,122,902)
2021 (109,340) (936,500) (61,470) (1,039,138) (2,146,448)
2022 (28,198) (450,794) (16,102) (393,316) (888,409)
2023 - (270,885) - (156,947) (427,832)
Thereafter $ - $ (241,008) $ - $ (703,640) $ (944,648)
Pension Liabilities -$
Pension Assets (1,412,740)
Deferred Outflows of Resources 339,191
Deferred Inflows of Resources (172,191)
Pension Expense (63,256)$
Aggregate Pension Amounts -Old Fire Pension
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
77
of FPF formula benefits over the LEOFF benefits. Therefore, the plan is closed to new
members. At December 31, 2018, FPF membership consisted of the following:
Inactive plan members retired prior to March 1, 1970 and receiving benefits: 0
Inactive plan members retired March 1, 1970 or after and receiving benefits: 8
Inactive plan members retired March 1, 1970 or after and not currently receiving benefits: 1
Active Plan Members: 0
Benefits provided. All benefit terms are in statutes RCW 41.16, 41.18, and 41.26. FPF provides
retirement, disability, and death benefits. Each firefighter in service on March 1, 1970 receives
the greater of the benefit payable under the Washington Law Enforcement Officers' and
Firefighters' Retirement System and the benefits available under the provisions of prior law.
Where benefits under the old law exceed those under the new law for any firefighter, the excess
benefits are paid from the FPF of the city employing the member on March 1, 1970.
All members are retired and drawing benefits. One member is eligible for City benefits but
because of the formulary is only receiving benefits from the state. He continues to be eligible
for City benefits if they exceed the LEOFF benefit. Benefit payments provide for cost-of-living
adjustments to each member's retirement benefit. There are two types of increases: escalation
by salary in proportion to the current salary of the rank from which the firefighter retired, or an
increase proportionate to the increase in the Seattle-area CPI, with the change computed
annually. Regardless of the increase (or decrease) in the CPI, the benefits are increased at least
2% each year. The former applies to firefighters who retired from service after 1969, their
survivors, and to firefighters who retired for duty disability (but not their survivors) after 1969.
The latter applies to all other types of monthly benefits.
Contributions. In 2018 and prior years, the City was eligible to receive a share of the State’s
distribution of the fire insurance premium taxes, subject to providing benefits to covered
members of the Fire Pension Plan. In 2018 the plan received $73,414 from this tax. In addition
to the fire insurance premium tax the plan receives interest and dividends on plan assets. In
recent year’s actuarial valuations have supported the City’s assertion that the plan is fully
funded. The City did not contribute to the plan in 2018.
Pursuant to the provisions of RCW 41.16.060, the City is allowed to levy up to $0.45 per $1,000
of assessed valuation to maintain the Fire Pension Fund. Only $0.225 of the levy can be in
excess of the property tax limit pursuant to RCW 84.52.043 and a report from a qualified
actuary must show the property tax is necessary to maintain the fund. The City does not
currently levy the allowable property tax to fund the FPF.
Investments
The Fire Pension Plan does not have an investment policy for investing pension funds. At year
end investments are reported at quoted market price as provided by our broker, US Bank. At
December 31, the Fire Pension Plan had the following investments, reported at fair market
value.
Federal Agency $ 19,368
Mutual Funds $ 2,084,822
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
78
Rate of Return. For the year ended December 31, 2018, the annual money-weighted rate of
return on pension plan investments, net of pension plan investment expense, was 9.18%. The
money-weighted rate of return expresses investment performance, net of investment expense,
adjusted for the changing amount actually invested.
Actuarial Assumptions: The total pension liability was determined by an actuarial valuation as
of December 31, 2017, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation 2.50%
Salary increases 3.00%
*Investment rate of return 7.00%
The discount rate was changed was reduced from 7.1% to 7.0% as of 12/31/18
Healthy life mortality rates were based on the RP-2014 mortality table, total dataset, fully
generational projected with Scale MP-2014, set back one year for males and set forward one
year for females. Disabled life mortality rates were based on the RP-2014 mortality table, total
dataset, fully generational projected with Scale MP-2014, set back two years for males and
females.
The long-term expected rate of return on pension plan investments assumption was based on
the nature and mix of current and expected pension plan assets over a period of time
representative of the expected length of time between the first day of service and date of the
last benefit payment.
Discount rate. The discount rate used to measure the total pension liability was 7.0%. The
projection of cash flows used to determine the discount rate assumed City contributions were
equal to the statutorily calculated contribution of state fire insurance premiums for the next 20
years. Based on this assumption, the pension plan's fiduciary net position was projected to be
available to make all projected future benefit payment for current plan members. Therefore,
the long-term expected rate of return on pension plan investments was applied to all periods of
projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate. The net pension liability
of the City, calculated using the discount rate of 7.0%, as well as what the City's net pension
liability would be if it were calculated using a discount rate that is one-percentage-point lower,
6.0%, or one-percentage point higher, 8.0%, than the current rate, follows:
1% Decrease Current Discount Rate 1% Increase
(1,475,951)$ (1,412,740)$ (1,454,228)$
Net Pension Liability
2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
79
Net Pension Liability
The components of the City’s net pension liability and funding status at December 31, 2018
are as follows:
The following table presents the changes in Net Pension Liability for year ending December 31,
2018.
Healthcare Actuaries performed an actuarial study on December 31, 2017 for this plan. The firm
also completed a roll forward update of the plan’s actuals for 2018. This plan does not have a
special funding situation.
Changes Since the Prior Valuation
1) The discount rate was changed from 7.10% to 7.00% as of December 31, 2017
2) The valuation reflects updated census information.
The City’s fiscal year and the Fire Pension Plan both observe a fiscal year ending December 31.
The components of FPF Plan Expense for 2018 are presented in the following table:
OLD FIRE PENSION - Funded Status as of December 31, 2018
Total Pension Liability 1,150,311$
Less: Plan Fiduciary Net Position 2,563,051
Fire Pension Fund Net Pension Liability/(Asset)(1,412,740)$
Plan Fiduciary net position as a percentage of the total pension liability 222.81%
Covered Payroll NA
USSL as a percentage of covered payroll NA
Total Pension Plan Fiduciary Net Net Pension
Liability Position Liability
(a)(b)(a)-(b)
Balances at January 1, 2018 1,193,946$ 2,762,393$ (1,568,447)$
Changes for the year:
Service Cost - - -
Interest 87,555 - 87,555
Differences between expected and actual experience (2,791) - (2,791)
Change in assumptions - - -
Net investment income - (139,434) 139,434
Contributions - 73,414 (73,414)
Benefit payments, including refunds of employee contribution (128,399) (128,399) -
Administrative expense - (4,923) 4,923
Other changes - - -
Net changes (43,635) (199,342) 155,707
Balances at December 31, 2018 1,150,311$ 2,563,051$ (1,412,740)$
Changes in Net Pension Liability
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
80
Deferred Outflows of Resources and Deferred Inflows of Resources
At December 31, 2018, the city reported deferred outflows of resources and deferred inflows of
resources related to the Fire Pension Plan from the following sources:
Deferred outflows of resources related to pensions resulting from the city’s contributions
subsequent to the measurement date will be recognized as a reduction of the net pension
liability in the year ended December 31, 2018. Other amounts reported as deferred outflows
and deferred inflows of resources related to pensions will be recognized in pension expense as
follows:
The schedule of changes in net pension liability and related ratios, schedule of employer
contributions and schedule of investment returns are presented as Required Supplementary
Information (RSI) and can be found immediately following the notes to the financial statements.
The tables present multi-year trend information about whether the actuarial value of plan assets
are increasing or decreasing relative to the actuarial accrued liability for benefits over time. The
pension plan has remained fully funded over the last five years and no additional contributions
were made by the City.
-$
87,555
(191,533)
4,923
(2,791)
-
38,590
Total Expense (63,256)$
Calculation of Expense uunder GASB 68
1) Service Cost
2) Interest on Liabilities
5) Differences between Expected and Actual Experience
6) Change in Assumptions
7) Differences Between Expected and Actual Earnings
3) Interest on Assets
4) Administrative Expenses
Deferred Outflows Deferred Inflows
of Resources of Resources
Difference between expected and actual -$ -$
Net difference between projected and actual
investment earnings on pension plan investments 339,191 (172,191)
- -
- -
- -
339,191$ (172,191)$ TOTAL
Firemen's Pension Plan
Changes in proportion and differences between
contributions and proportionate share of contributions
Contributions subsequent to the measurement date
Changes of assumptions
Year Ended December 31 Fire Pension Plan
2019 38,590.00$
2020 38,590
2021 23,630
2022 66,194
2023 -
Thereafter -$
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
81
The Fire Pension Fund is reported in the City’s CAFR as a Fiduciary Fund. Pension Liability,
Pension Asset, Deferred Inflows and Deferred Outflows are reported in the Government Wide
Statement of Net Position. A copy of the plan statements can be obtained by request at the
following address: City of Pasco 525 N 3rd Ave., Pasco, WA 99301.
NOTE 14: Defined Benefit Other Postemployment Benefit (OPEB) Plans
The following table represents the aggregate OPEB amounts for all plans subject to the
requirements of GASBS 75 for the year 2018:
LEOFF 1 – Postemployment Healthcare Plan
In addition to the pension benefits outlined in Note 8, Employee Retirement Systems and Pension
Plans, the City of Pasco provides post-retirement health care benefits via a single employer defined
benefit plan in accordance with state statute for retired police officers and firefighters who are
eligible for lifetime healthcare under the Law Enforcement Officers’ and Firefighters’ (LEOFF1)
plan one retirement system.
The LEOFF 1 Disability Board is responsible for management of the LEOFF 1 OPEB plan, which
is mandated by RCW 41.26. The LEOFF 1 Disability Board consists of the following five
members: the mayor or a designated representative who shall be an elected official of the city, who
shall be chairperson of the board, a council member, a “citizen at large” appointed by the City, one
retired firefighter and one retired police officer. The members to be elected by the firefighters shall
be elected annually for a two-year term. The two firefighters elected as members shall, in turn,
select a third eligible member who shall serve as an alternate in the event of an absence of one of
the regularly elected members. In case a vacancy occurs in the membership of the firefighters or
retired members, the members shall in the same manner elect a successor to serve the unexpired
term. The board may select and appoint a secretary who may, but need not be a member of the
board. In case of absence or inability of the chairperson to act, the board may select a chairperson
pro tempore who shall during such absence or inability to perform the duties and exercise the
powers of the chairperson. A majority of the members of the board shall constitute a quorum and
have power to transact business.
In 2017 the City of Pasco implemented the provisions of GASB 74, Financial Reporting for
Postemployment Benefit Plans Other Than Pension Plans, and GASB 75, Accounting and
Financial Reporting for Postemployment Benefits Other Than Pensions. These statements address
both the OPEB Plan and the employer’s reporting requirements. GASB 75 requires the net OPEB
liability to be measured as the total OPEB liability, less the amount of the OPEB plan’s fiduciary
OPEB liabilities 16,223,295$
OPEB assets (1,140,935)
Deferred outflows of resources 250,682
Deferred inflows of resources (184,280)
OPEB expense/expenditures 624,561$
Aggregate OPEB Amounts – All Plans
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
82
net position. The City, as employer is required to report the net OPEB liability or (asset), and
deferred inflows and outflows associated with the plan in the Government Wide Statement of Net
Position. The LEOFF 1 OPEB plan is funded on a pay as you go basis and as such, the plan does
not have assets accumulated for future payments.
In prior years the City reported this plan under the provisions of GASB 45, which calculated the
liability for the plan as the cumulative over/under funding of the annual required contribution, plus
associated interest.
Plan Description: As required by the Revised Code of Washington (RCW) Chapter 41.26, the
City provides lifetime medical care for members of the Law Enforcement Officers and Firefighters
(LEOFF) retirement system hired before October 1, 1977, under a defined-benefit healthcare plan
administered by the City. The members' necessary hospital, medical, prescription and nursing care
expenses not payable by worker's compensation, Medicare, or other insurance are covered. LEOFF
1 members are eligible for the plan when they terminate employment. The plan is closed to new
participants and there are currently 31 retired LEOFF 1 members in the plan and one remaining
active LEOFF 1 employee that will be eligible upon retirement. There are no inactive plan
members not receiving plan benefits. The plan requires members to sign up for Medicare and pay
the premiums when they reach age 65. The City contributes the full premium for the City’s
healthcare for all members. Although the premium charged is the same as active employees, 29 of
the 31 eligible members have primary coverage with Medicare and the City insurance is a
secondary provider. Only two members have primary coverage with the City. The Board must
approve any medical reimbursements not covered by Medicare or the City’s insurance. In 2018
the City paid $542,748 in monthly premiums for 31 members and $3,119 for additional items not
covered by Medicare or insurance. For year ending 2018, the City’s benefit payments totaled
$545,867, which is 345% of covered payroll. Plan members do not contribute to the plan and
spouses and other dependents are not eligible for this plan. There are no third party contributions
to this plan.
Employees covered by benefit terms: At December 31, 2018, the following employees were
covered by the benefit terms:
The LEOFF 1 OPEB Plan has no assets and is considered unfunded, the total liability is reported
in the Government Wide Statement of Net Position.
The components of the Net OPEB Liability of the City as of December 31, 2018, were as follows:
Inactive employees or beneficiaries currently receiving benefits 31
Inactive employees entitled to but not yet receiving benefits 0
Active employees 1
Total 32
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
83
Total OPEB Liability as a percentage of covered payroll 10,266%
Healthcare Actuaries performed an actuarial study on December 31, 2017 for this plan under
GASB 74 and 75 standards. The firm also completed a roll forward update of the plan’s actuals
for 2018.
Summary of Significant Accounting Policies: For purposes of measuring the net OPEB liability,
deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB
expense information about the fiduciary net position of the City of Pasco LEOFF 1 Plan, (the plan)
and additions to/deductions from the Plan’s fiduciary net position have been determined on the
same basis as they are reported by the plan. For this purpose, the plan recognizes benefit payments
when due and payable in accordance with the benefit terms. The LEOFF 1 OPEB plan is accounted
for using a modified accrual basis of accounting.
Funding Policy: Pursuant to state statute, the City reimburses 100% of authorized LEOFF 1 retiree
healthcare costs. The City pays a monthly insurance premium to cover each retiree under its
medical insurance program as well as any remaining eligible out-of-pocket expenses. Retirees are
not required to contribute to the plan.
Actuarial Assumptions: The total liability in the December 31, 2018 actuarial valuation was
determined using the following actuarial assumptions, applied to all periods included in the
measurement, unless otherwise specified
Inflation: 2.75%
Salary Increases: 3.75%
Healthcare cost trend rates: 7.0% in the first year, trending down to 3.84% over 58 years
Healthy mortality rates: RPH-2014 mortality table (headcount weighted), total dataset, fully
generational with mortality improvement scale MP-2017, set back one year for males and set
forward one year for females.
Disabled mortality rates: RPH-2014 mortality table (headcount weighted), total dataset, fully
generational with mortality improvement scale MP-2017, set forward two years for males and
females.
Discount Rate: The discount rate used to measure the total OPEB liability was 3.5%. The City’s
OPEB Plan is an unfunded plan, therefore the discount rate was set to the rate of tax-exempt, high
quality 20 year municipal bonds, as of the valuation date.
Sensitivity of the total OPEB liability to changes in the discount rate. The total OPEB liability of
the City, as well as what the City’s total OPEB Liability would be if it were calculated using a
discount rate that is one point lower (2.50%) or one percentage point higher (4.50%) follows:
Total OPEB Liability 16,223,295$
Plan Fiduciary Net Position -
City's Total OPEB Liability 16,223,295
Covered Payroll 158,030$
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
84
Sensitivity of the total OPEB liability to changes in the healthcare cost trend rates. The total
OPEB liability of the City, as well as what the City’s total OPEB Liability would be if it were
calculated using a healthcare cost trend rates that is one point lower (6.00%) or one percentage
point higher (8.00%) than current healthcare cost trend rates follows:
Changes in the Net OPEB Liability
The changes in total OPEB liability for 2018 are presented in the following table.
The plan incurred pension expense of $732,807 in 2018. Under GASB 75, the basic formula for
calculating OPEB expense is as follows:
There is a schedule of sources of changes in the net OPEB liability presented as RSI,
immediately following the notes to the financial statements. Because this plan is unfunded there
are no disclosures relating to Fiduciary Net Position or investment experience.
1% Decrease Current Discount Rate 1% Increase
2.50%3.50%4.50%
18,260,395$ 16,223,295$ 14,335,768$
Total OPEB Liability
1% Decrease Current Discount Rate 1% Increase
6.00%7.00%8.00%
Decreasing to 2.84%Decreasing to 3.84%Decreasing to 4.84%
14,408,011$ 16,223,295$ 18,127,501$
Total OPEB Liability
Total OPEB
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net OPEB Liability
(c) = (a) - (b)
Balances at January 1, 2018 16,179,101$ -$ 16,179,101$
Changes for the year
Service cost 95,746 - 95,746
Interest 557,569 - 557,569
Benefit payments (609,121) - (609,121)
Net changes 44,194 - 44,194
Balance as of Decermber 31, 2018 16,223,295$ -$ 16,223,295$
Changes in Net OPEB Liability
December 31, 2018
1) Service Cost 95,746$
2) Interest (on liabilities)557,569
3) Interest (on assets)-
4) Administrative Expenses -
5) Difference between expected and actual experience 79,492
6) Change in Assumptions -
7) Difference between expected and actual earnings -
Total Expense 732,807$
Calculation of Expense under GASB 75
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
85
There were no Deferred Outflows or Deferred Inflows of resources related to this OPEB Plan for
2018.
Fire Pension – Postemployment Healthcare Plan
Effective December 31, 2017, the City of Pasco implemented the provisions of GASB 74,
Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, and GASB 75,
Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. These
statements address both the OPEB Plan and the employer’s reporting requirements. GASB 75
requires the net OPEB liability to be measured as the total OPEB liability, less the amount of the
OPEB plan’s fiduciary net position. The City, as employer is required to report the net OPEB
liability or (asset), and deferred inflows and outflows associated with the plan in the Government
Wide Statement of Net Position.
The Old Fire OPEB Plan is a defined benefit plan administered through a trust. The Fire Pension
Board is responsible for management of the Old Fire OPEB plan, which is mandated by RCW
41.26. The Firefighters Pension Board consists of the following five members: the mayor or a
designated representative who shall be an elected official of the city, who shall be chairperson of
the board, the City Clerk, the City Finance Manager/Director and two elected retired firefighters
covered by the plan. The two firefighters elected as members shall, in turn, select a third eligible
member who shall serve as an alternate in the event of an absence of one of the regularly elected
members. In case a vacancy occurs in the membership of the firefighters or retired members, the
members shall in the same manner elect a successor to serve the unexpired term. The board may
select and appoint a secretary who may, but need not be a member of the board. In case of absence
or inability of the chairperson to act, the board may select a chairperson pro tempore who shall
during such absence or inability to perform the duties and exercise the powers of the chairperson.
A majority of the members of the board shall constitute a quorum and have power to transact
business.
Plan Description: The Old Fire Pension OPEB covers firefighters that were hired prior to the
creation of the LEOFF 1 retirement system. As required by the Revised Code of Washington
(RCW) Chapter 41.26, the City provides these retirees lifetime medical care under a defined-
benefit healthcare plan administered by the City. The members' necessary hospital, medical,
prescription and nursing care expenses not payable by worker's compensation, Medicare, or other
insurance are covered. Plan members are eligible for the plan when they terminate employment.
The plan is closed to new participants and all eligible members are retired and drawing benefits.
There are currently 5 eligible members in the plan and spouses and beneficiaries are not eligible
for the plan. The plan requires members to sign up for Medicare and pay the premiums when they
reach age 65. The City contributes the full premium for the City’s healthcare for all members and
members do not contribute to the plan. Although the premium charged is the same as active
employees, all 5 members have primary coverage with Medicare and the City insurance is a
secondary provider. The Board must approve any medical reimbursements not covered by
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
86
Medicare or the City’s insurance. In 2018 the plan paid $87,540 in monthly premiums for 5
members and $3,119 for additional items not covered by Medicare or insurance.
The components of the Net OPEB Liability of the City as of December 31, 2018, were as follows:
Healthcare Actuaries completed a full valuation under the new GASB 74 and 75 standards, of the
plan as of December 31, 2017. The firm also completed a roll forward update of the plan’s actuals
for 2018.
Summary of Significant Accounting Policies: For purposes of measuring the net OPEB liability,
deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB
expense information about the fiduciary net position of the Old Fire OPEB Plan, (the plan) and
additions to/deductions from the Plan’s fiduciary net position have been determined on the same
basis as they are reported by the plan. Investments are reported at fair value. The Old Fire OPEB
plan is accounted for using a modified accrual basis of accounting.
Funding Policy: Pursuant to state statute, the City is wholly responsible for 100% of authorized
Old Fire OPEB retiree healthcare costs. The City pays a monthly insurance premium to cover each
retiree under its medical insurance program as well as any remaining eligible out-of-pocket
expenses. Retirees are not required to contribute to the plan.
Actuarial Assumptions: The total liability in the December 31, 2018 actuarial valuation was
determined using the following actuarial assumptions, applied to all periods included in the
measurement, unless otherwise specified
Inflation: 2.75%
Salary Increases: 3.75%
Healthcare cost trend rates: 6.0% in the first year, trending down to 3.84% over 58 years
Healthy mortality rates: RPH-2014 mortality table (headcount weighted), total dataset, fully
generational with mortality improvement scale MP-2017, set back one year for males and set
forward one year for females.
Disabled mortality rates: RPH-2014 mortality table (headcount weighted), total dataset, fully
generational with mortality improvement scale MP-2017, set forward two years for males and
females.
Total OPEB liability 1,704,242$
Fiduciary net position 2,845,178
Net OPEB liabiilty (asset)(1,140,936)$
Plan Fiduciary Net Position as a percentage of the total OPEB 166.95%
Covered Payroll N/A
Total OPEB liability as a percentage of covered payroll N/A
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
87
Discount Rate: The discount rate used to measure the total OPEB liability was 7.75%. The City’s
Old Fire OPEB Plan’s fiduciary net position was projected to be available to make all projected
future benefit payment for current members. Therefore, the long-term expected rate of return on
plan investments was applied to all periods of projected benefit payments to determine the total
OPEB liability.
Sensitivity of the total OPEB liability to changes in the discount rate. The total OPEB liability of
the City, as well as what the City’s total OPEB Liability would be if it were calculated using a
discount rate that is one point lower (6.75%) or one percentage point higher (8.75%) follows:
Sensitivity of the total OPEB liability to changes in the healthcare cost trend rates. The total
OPEB liability of the City, as well as what the City’s total OPEB Liability would be if it were
calculated using a healthcare cost trend rates that is one point lower (5.00%) or one percentage
point higher (7.00%) than current healthcare cost trend rates follows:
Changes in the Net OPEB Liability
The changes in total OPEB liability for 2018 are presented in the following table.
1% Decrease Current Discount Rate 1% Increase
6.75%7.75%8.75%
(1,075,510)$ (1,140,935)$ (1,314,489)$
Total OPEB Liability
1% Decrease Current Discount Rate 1% Increase
5.00%6.00%7.00%
Decreasing to 2.84%Decreasing to 3.84%Decreasing to 4.84%
(1,309,861)$ (1,140,935)$ (1,082,917)$
Total OPEB Liability
Total OPEB Plan Fiduciary Net Net OPEB
Liability Position Liability
(a)(b)(c) = (a)-(b)
Balances at January 1, 2018 1,612,381$ 3,023,373$ (1,410,992)$
Changes for the year:
Service Cost - - -
Interest 121,446 - 121,446
Differences between expected and actual
experience 61,074 61,074
Change in assumptions - - -
Net investment income - (84,994) 84,994
Contributions - - -
Benefit payments, including refunds -
of employee contributions (90,659) (90,659) -
Administrative expense - (2,542) 2,542
Other changes - - -
Net changes 91,861 (178,195) 270,056
Balances at December 31, 2018 1,704,242$ 2,845,178$ (1,140,936)$
Schedule of changes in the Net OPEB Liability
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
88
The plan incurred pension expense of ($108,246) in 2018. Under GASB 75, the basic formula for
calculating OPEB expense is as follows:
At December 31, 2018, the City reported deferred outflows of resources and deferred inflows of
resources related to OPEB from the following sources:
Amounts reported as deferred outflows or resources and deferred inflows of resources related to
OPEB will be recognized in OPEB expense as follows:
Investments: The Old Fire OPEB Plan does not have an investment policy. The board approves
any purchase or sale transactions regarding assets of the plan. The plan has only one investment,
a mutual fund that was purchased in 2003. The investment is detailed in the following table.
The Old Fire OPEB Plan does not have a specific reserve policy or requirement, however all
assets of the plan are considered assets of the trust and as such are obligated for payment of
current and future benefits to plan members.
December 31, 2018
1) Service Cost -$
2) Interest (on liabilities)119,168
3) Interest (on assets)(228,359.00)
4) Administrative Expenses 2,542.00
5) Difference between expected and actual experience 61,074.00
6) Change in Assumptions -
7) Difference between expected and actual earnings (62,671.00)
Total Expense (108,246)$
Calculation of Expense under GASB 75
Deferred Outflow
of Resources
Deferred Inflows
of Resources
Differences between actual and expected experience -$ -$
Change of assumptions - -
Net difference between projected and actual earnings on OPEB plan investments 250,682 (184,280)
Total 250,682$ (184,280)$
Year Ended Dec 31 Amount
2019 1,245$
2020 1,245
2021 1,245
2022 62,669$
Name of Investment Type
Balance as of
12/31/18
Rating of
Morningstar
2018 YTD
Returns
Annualized Return
Since 1/1/03
Wshington Mutual Investeres Fund-A Mutual Fund 2,844,174$ gold 10.30%8.66%
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
89
NOTE 15: CONTINGENCIES AND LITIGATION
The City has recorded in its financial statements all material liabilities, including applicable
estimates for situations that are not yet resolved but where, based on available information,
management believes it is probable that the City will have to make payment. The City has closely
reviewed all pending claims and it is management’s opinion, the City's insurance policies and self-
insurance reserves are adequate to pay all material known or pending claims. As discussed in Note
3. F, Long-term Debt, the City is contingently liable for repayment of debt.
The City participates in a number of Federal and State assisted programs. These grants are subject
to audit by the grantor or representative. Such audits could result in requests for reimbursement
to grantor agencies for expenditures disallowed under the terms of the grants. However, City
management believes that such disallowances, if any, will be immaterial.
Currently, there is an underground fire in a non-municipal Pasco landfill which closed in
1998. The Washington State Department of Ecology (DOE) is proposing to issue an enforcement
order to parties collectively known as Potentially Liable Persons (PLPs). The City entered into an
“Institutional Control” agreement with the DOE to regulate development and provide for the
conversion of private water wells located down-plume from the site to be abandoned in favor of
using the City’s municipal water system. It is the City’s understanding that, because of its entering
into this agreement, the DOE is excluding the City from being designated as a PLP.
As of the date of this report, a diligent review has revealed no anticipated, unasserted claims
against the City, with one pending action in litigation. The litigation was commenced by Total
Site Services, LLC (Total Site Services LLC. v. City of Pasco) in Franklin Superior Court
seeking an estimated claim of $243,729.75 for additional cost resulting from the construction of
the Pasco Police Community Services Building. The claim is denied by the City. The litigation
is in the discovery phase; settlement efforts are on-going with a trial date scheduled for January,
2020.
NOTE 16: SUBSEQUENT EVENT
On March 18, 2019, the City passed Ordinance No. 4429 confirming assessments for Local
Improvement District No. 150 for the construction of roadway improvements. The total
assessment is $5,254,801. The City will issue and sale local improvement bond for LID 150 for
the remaining assessment amount after the 30-day prepayment period, ending May 28th.
NOTE 17: PRIOR PERIOD ADJUSTMENT
The following table itemizes the prior period adjustments made in 2018, along with the purposes for the
adjustments:
Construction Fund (43,920)$
Governmental Funds
Capital Asset Correction 1
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
90
1Because capital assets are not recorded in governmental funds they are not reflected in the fund
financial statements; corrections of prior period balances only affect the government-wide
financial statements. $43,920 of expenditures related to feasibility charges for a new Animal
Shelter Facility expended by the Animal Control Authority were miscoded to the Construction
Fund. These charges were misclassified as Construction Work in Progress in the Construction
Fund in 2017. These charges were removed from Construction Work in Progress and expensed.
Further, the expenses were moved to the Animal Control Authority Fund (external organization,
agency fund).
Purpose for prior period adjustments:
1. $27,133 of donations received in 2017 for feasibility charges for a new Animal Shelter
Facility were miscoded to the Construction Fund. The revenues were moved from the
Construction Fund to the Animal Control Authority Fund (external organization, agency
fund).
2. $43,920 of 2017 expenditures related to feasibility charges for a new Animal Shelter
Facility expended by the Animal Control Authority were miscoded to the Construction
Fund. The expenditures were moved from the Construction Fund to the Animal Control
Authority Fund (external organization, agency fund).
Governmental Activities
Purpose for
Adjustment Decrease Increase Adjustment to Fund
Balance/ Net Position
Construction Fund 1 (27,133)$ -$ (27,133)$
Construction Fund 2 - 43,920 43,920
16,787$ Total
Prior Period Adjustments
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
91
REQUIRED SUPPLEMENTARY INFORMATION
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
92
Old Fire OPEB Fund
A schedule of contributions for the Old Fire OPEB Fund is not included because the plan is fully
funded and there have been no contributions for the past five years. The OPEB plan's fiduciary
net position is projected to have sufficient funds to pay all projected benefit payment for current
plan members. Therefore, there no future projected contributions.
2017 2018
Total OPEB liability
Service cost -$ -$
Interest 121,181 121,446
Changes of benefit terms - -
Differences between expected and actual experience - 61,074
Changes of assumptions - -
Benefit payments, including refunds of contributions (144,838) (90,659)
Net change in total OPEB liability (23,657) 91,861
Total OPEB liability - beginning 1,636,038 1,612,381
Total OPEB liability - ending (a)1,612,381 1,704,242
Plan fiduciary net position
Contributions - employer - -
Contributions - employee - -
Net investment income 507,854 (84,994)
Benefit payments, including refunds of contributions (144,838) (90,659)
Administrative expense (4,048) (2,542)
Other - -
Net change in plan fidiciary net position 358,968 (178,195)
Plan fiduciary net position - beginning 2,664,405 3,023,373
Plan fiduciary net position - ending (b)3,023,373 2,845,178
Net OPEB liability ending (a) - (b)(1,410,992)$ (1,140,936)$
Plan fiduciary net position as a % of total OPEB liability (b)/(a)187.51%166.95%
Covered-employee payroll**N/A N/A
Net OPEB liability as a % of covered-employee payroll N/A N/A
Notes to Schedule:
*Until a full 10-year trend is compiled, only information for those years available is presented. The
City adopted GASB 75 for the fiscal year ending December 31, 2017.
Schedule of Changes in Net OPEB Liability and Related Ratios
Old Fire OPEB
For the year ended December 31, 2018
Last 10 Fiscal Years*
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
93
LEOFF 1 OPEB Fund
The Schedule of Investment Returns was not included for this plan because there are no fund
assets to invest. These schedules are presented to illustrate the requirements to show information
for 10 years, however until a full 10-year trend is compiled the City will present all available
GASB 74/75 compliant information.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
94
Old Fire Pension Fund
2015 2016 2017 2018
Statutorially Determined Contribution 54,506$ 58,193$ 63,503$ 73,414$
Less Contributions Made (54,506) (58,193) (63,503) (73,414)
Contribution Deficiency (excess)- - - -
Covered-Employee Payroll -$ -$ -$ -$
Contributions as a percentage of covered employee payroll n/a n/a n/a n/a
This schedule will be built prospectively until it contains 10 years of data
Notes to Schedule:
Contributions came from State Fire Insurance Premiums.
Schedule of Contributions
Fire Pension Fund
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
95
State Plans
*GASB 68 requires a disclosure of the changes in Net Pension Liability for the last 10 fiscal years, or as
years are available. These schedules will be built prospectively until they contain ten years of data.
PERS PLAN 1 2014 2015 2016 2017 2018
Employer's percentage of the net pension liability 0.097647%0.102321%0.098322%0.099661%0.093918%
Employer's proportionate share of the collective net
pension liability 4,919,014$ 5,352,340$ 5,280,355$ 4,728,992$ 4,194,410$
Employer's covered employee payroll 342,721 163,430 104,245 34,781 -
Employer's proportionate share of the net pension
liability as a percentage of covered employee payroll 1435.28%3275.00%5065.33%13596.48%419441000.00%
Plan fiduciary net position as a percentage of the total pension
liablity 61.19%59.10%57.03%61.24%63.22%
PERS PLAN 2/3
Employer's percentage of the net pension liability 0.114462%0.125949%0.122675%0.126788%0.120274%
Employer's proportionate share of the collective net
pension liability 2,313,690 4,500,230 6,176,589 4,405,277 2,053,572
Employer's covered employee payroll 10,474,619 11,212,390 11,878,130 12,471,204 13,008,696
Employer's proportionate share of the net pension
liability as a percentage of covered employee payroll 22.09%40.14%52.00%35.32%15.79%
Plan fiduciary net position as a percentage of the total pension
liablity 93.29%89.20%85.82%90.97%95.77%
LEOFF 1
Employer's percentage of the net pension asset 0.067804%0.067488%0.066826%0.066934%0.067877%
Employer's proportionate share of the collective net
pension asset (822,321) (813,380) (688,499) (1,015,536) (1,232,308)
Employer's covered employee payroll 219,984 207,267 226,769 197,219 162,162
Employer's proportionate share of the net pension
asset as a percentage of covered employee payroll -373.81%-392.43%-303.61%-514.93%-759.92%
Plan fiduciary net position as a percentage of the total pension
liablity 126.91%127.36%123.74%135.96%144.42%
LEOFF 2
Employer's percentage of the net pension asset 0.365709%0.405844%0.400187%0.427714%0.469232%
Employer's proportionate share of the collective net
pension asset (4,853,116) (4,171,265) (2,327,608) (5,935,285) (9,526,433)
Employer's covered employee payroll 10,497,629$ 12,154,638$ 12,622,501$ 14,338,666$ 17,145,685$
Employer's proportionate share of the net pension
asset as a percentage of covered employee payroll -46.23%-34.32%-18.44%-41.39%-55.56%
Plan fiduciary net position as a percentage of the total pension
liablity 116.75%111.67%106.04%113.36 118.5
Schedule of Proportionate Share of the Net Pension Liability/(Asset)
As of June 30
Last 10 Fiscal Years*
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
96
*GASB 68 requires a disclosure of the changes in Net Pension Liability for the last 10 fiscal years, or as
years are available. These schedules will be built prospectively until they contain ten years of data.
PERS PLAN 1 2014 2015 2016 2017 2018
Statutorily or contractually required contributions 31,484$ 16,252$ 10,583$ 4,077$ -$
Contributions in relation to the statutorily or contractually
required contributions (31,484) (16,252) (10,583) (4,077) -
Contribution deficiency (excess)- - - - -
Covered employer payroll 342,721 163,430 104,245 34,781 -
Contributions as a percentage of covered employee payroll 9.19%9.94%10.15%11.72%0.00%
PERS PLAN 2/3
Statutorily or contractually required contributions 964,775 1,140,430 1,327,926 1,482,156 1,657,497
Contributions in relation to the statutorily or contractually
required contributions (964,775) (1,140,430) (1,327,926) (1,482,156) (1,657,497)
Contribution deficiency (excess)- - - - -
Covered employer payroll 10,474,619 11,212,390 11,877,299 12,471,204 13,008,696
Contributions as a percentage of covered employee payroll 9.21%10.17%11.18%11.88%12.74%
LEOFF 1
Statutorily or contractually required contributions 396 373 407 355 292
Contributions in relation to the statutorily or contractually
required contributions (396) (373) (407) (355) (292)
Contribution deficiency (excess)- - - - -
Covered employer payroll 219,984 207,267 225,834 197,218 162,162
Contributions as a percentage of covered employee payroll 0.18%0.18%0.18%0.18%0.18%
LEOFF 2
Statutorily or contractually required contributions 549,396 635,688 660,156 763,912 937,526
Contributions in relation to the statutorily or contractually
required contributions (549,396) (635,688) (660,156) (763,912) (937,526)
Contribution deficiency (excess)- - - - -
Covered employer payroll 10,497,629$ 12,154,638$ 12,622,501$ 14,338,666$ 17,145,685$
Contributions as a percentage of covered employee payroll 5.23%5.23%5.23%5.33%5.47%
Schedue of Employer Contributions
As of June 30
Last 10 Fiscal Years*
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
97
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
Nonmajor Governmental Funds
Special Revenue Funds
Special revenue funds are used to accoutn for specific revenues that are legally restricted to exp enditures for
particular purposes.
Debt Service Funds
Debt service fundsare used to account for the accumulation of resources for and the payment of general long -term
debt principal and interest.
Permanent Funds
Permanent funds are used to report resources that are legally restricted to the extent that only earnings, not
principal, may be used for purposes that support the reporting government’s programs.
Major Governmental Fund
Capital Project Fund
Capital project funds are used to account for the acquistion and construction of major capital facilities other than
those financed by proprietary funds and trust funds.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
98
Total Total Cemetery
Nonmajor Nonmajor Perpetual Care Total
Other Special Debt Nonmajor Other
Revenue Service Permanent Governmental
ASSETS
Cash & cash equivalents 18,470,022$ 239,039$ 69,037$ 18,778,098$
Restricted cash:
Customer deposits 122,541 - 122,541
Cemetery endowment - - 461,945 461,945
Debt service - 153,856 153,856
Investments 6,373,550 - 6,373,550
Receivables (net of allowances):
Taxes 560,865 - 560,865
Customers 1,759,807 28,081 252 1,788,140
Interfund loans 106,971 - 106,971
Grants 328,288 - 328,288
Special assessments & loans 124,780 124,712 249,492
Total assets 27,846,824 545,688 531,234 28,923,746
LIABILITIES
Accounts payable 1,016,393 - 1,016,393
Interfund loans payable 2,000,000 125,301 2,125,301
Due to other funds 762,670 - 762,670
Deposits payable from restricted assets 115,120 - 115,120
Total liabilities 3,894,183 125,301 - 4,019,484
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 239,240 124,712 363,952
FUND BALANCES
Nonspendable
Cemetery permanent fund - - 531,234 531,234
Restricted
Street and boulevard 8,635,462 - 8,635,462
Litter & housing abatement 415,588 - 415,588
Park development 2,219,436 - 2,219,436
Culture & recreation 98,638 - 98,638
Capital improvements 8,853,212 - 8,853,212
Economic development 96,235 - 96,235
Debt guarantee - 361,663 361,663
Committed
Special revenue funds 3,394,830 - 3,394,830
Unassigned - (65,988) (65,988)
Total fund balances 23,713,401 295,675 531,234 24,540,310
Total liabilities, deferrend inflows of
resources and fund balances 27,846,824$ 545,688$ 531,234$ 28,923,746$
Combining Balance Sheet
Nonmajor Other Governmental Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
99
Total Total Cemetery
Nonmajor Nonmajor Perpetual Care Total
Other Special Debt Nonmajor Other
Revenue Service Permanent Governmental
REVENUES
Taxes 4,294,079$ -$ -$ 4,294,079$
Licenses and permits 306,280 - - 306,280
Intergovernmental revenue 4,216,737 - - 4,216,737
Charges for services 10,867,460 - 20,973 10,888,433
Fines and forfeitures 128,497 - - 128,497
Miscellaneous revenue 2,034,351 90,725 5,087 2,130,163
Total revenues 21,847,404 90,725 26,060 21,964,189
EXPENDITURES
Current:
Public safety 7,247,682 - 7,247,682
Transportation 2,432,350 5,085 2,437,435
Natural and economic environment 4,450,085 - 4,450,085
Culture and recreation 3,102,872 - 3,102,872
Capital outlay:-
Public safety 42,302 - 42,302
Natural and economic environment 5,679 - 5,679
Culture and recreation 761,816 - 761,816
Debt service:
Principal - 20,000 20,000
Interest 37,732 10,864 48,596
Total expenditures 18,080,518 35,949 - 18,116,467
Excess of revenues
over expenditures 3,766,886 54,776 26,060 3,847,722
OTHER FINANCING SOURCES (USES)
Transfers in 829,931 - 829,931
Transfers out (2,466,397) - (2,466,397)
Total other financing sources (uses)(1,636,466) - - (1,636,466)
Net change in fund balances 2,130,420 54,776 26,060 2,211,256
Fund balances - beginning 21,582,981 240,899 505,174 22,329,054
Fund balances - ending 23,713,401$ 295,675$ 531,234$ 24,540,310$
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Other Governmental Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
100
Community
City Arterial I-182 Traffic Street Development
Street Street Impact Overlay Block Grant
ASSETS
Cash & cash equivalents 32,658$ 671,386$ 832,345$ 3,417,312$ 84,646$
Restricted cash:
Customer deposits 2,508 1,000
Cemetery endowment
Debt service
Investments 290,697 259,228 1,003,716 -
Receivables (net of allowances):
Taxes 169,710 76,163 69,530 -
Customers 12,804 -
Interfund loans -
Grants 271,512
Special assessments & loans 124,780
Total assets 217,680 1,038,246 1,091,573 4,490,558 481,938
LIABILITIES
Accounts payable 53,914 7,484 10,876
Interfund loans payable -
Due to other funds 312,210 250,460
Deposits payable from restricted assets 1,000
Total liabilities 366,124 - - 7,484 262,336
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 124,780
FUND BALANCES
Nonspendable
Cemetery permanent fund
Restricted
Street and boulevard 990,294 1,091,573 4,483,074
Litter & housing abatement
Park development
Culture & recreation
Capital improvements
Economic development 94,822
Debt guarantee
Committed
Special revenue funds (148,444) 47,952
Unassigned
Total fund balances (148,444) 1,038,246 1,091,573 4,483,074 94,822
Total liabilities, deferrend inflows of
resources and fund balances 217,680$ 1,038,246$ 1,091,573$ 4,490,558$ 481,938$
Continued on next page
Combining Balance Sheet
Nonmajor Special Revenue Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
101
M.L. King
Community Ambulance City View Boulevard Athletic
Center Services Cemetery Perpetual Program
ASSETS
Cash & cash equivalents 181,287$ 281,707$ 151,279$ 1,509,002$ 275,604$
Restricted cash:
Customer deposits 103,684 247 4,666
Cemetery endowment
Debt service
Investments 454,548
Receivables (net of allowances):
Taxes
Customers 1,453,343 2,438 589
Interfund loans 106,971
Grants 54,559
Special assessments & loans
Total assets 181,287 1,893,293 153,964 2,070,521 280,859
LIABILITIES
Accounts payable 9,078 255,406 8,352 12,695
Interfund loans payable 2,000,000
Due to other funds
Deposits payable from restricted assets 103,684
Total liabilities 9,078 2,359,090 8,352 - 12,695
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 2,534 76,086
FUND BALANCES
Nonspendable
Cemetery permanent fund
Restricted
Street and boulevard 2,070,521
Litter & housing abatement
Park development
Culture & recreation
Capital improvements
Economic development
Debt guarantee
Committed
Special revenue funds 169,675 (465,797) 69,526 268,164
Unassigned
Total fund balances 169,675 (465,797) 69,526 2,070,521 268,164
Total liabilities, deferrend inflows of
resources and fund balances 181,287$ 1,893,293$ 153,964$ 2,070,521$ 280,859$
Continued on next page
Combining Balance Sheet
Nonmajor Special Revenue Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
102
Rivershore Trail
Golf Senior Multi-Modal School & Marina
Course Center Facility Impact Fees Maintenance
ASSETS
Cash & cash equivalents 138,449$ 44,661$ 453,777$ 280,957$ 13,569$
Restricted cash:
Customer deposits 4,400 6,036
Cemetery endowment
Debt service
Investments
Receivables (net of allowances):
Taxes
Customers 29,056
Interfund loans
Grants 2,217
Special assessments & loans
Total assets 171,905 46,878 459,813 280,957 13,569
LIABILITIES
Accounts payable 35,772 9,621 103,931 280,647 108,177
Interfund loans payable
Due to other funds 200,000
Deposits payable from restricted assets 4,400 6,036
Total liabilities 40,172 9,621 109,967 280,647 308,177
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 33,095 100 145
FUND BALANCES
Nonspendable
Cemetery permanent fund
Restricted
Street and boulevard
Litter & housing abatement
Park development
Culture & recreation 98,638
Capital improvements
Economic development
Debt guarantee
Committed
Special revenue funds 37,157 349,701 310 (294,608)
Unassigned
Total fund balances 98,638 37,157 349,701 310 (294,608)
Total liabilities, deferrend inflows of
resources and fund balances 171,905$ 46,878$ 459,813$ 280,957$ 13,569$
Continued on next page
Combining Balance Sheet
Nonmajor Special Revenue Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
103
Rivershore Trail Special T.R.A.C.
Lodging Litter Revolving Development Park
Assessment Abatement Abatement & Operating Development
ASSETS
Cash & cash equivalents 32,223$ 24,212$ 233,339$ 384,002$ 1,741,504$
Restricted cash:
Customer deposits
Cemetery endowment
Debt service
Investments 477,932
Receivables (net of allowances):
Taxes 36,916 37,175
Customers 161,577 100,000
Interfund loans
Grants
Special assessments & loans
Total assets 69,139 24,212 394,916 521,177 2,219,436
LIABILITIES
Accounts payable 67,726 1,040
Interfund loans payable
Due to other funds
Deposits payable from restricted assets
Total liabilities 67,726 - 1,040 - -
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 2,500
FUND BALANCES
Nonspendable
Cemetery permanent fund
Restricted
Street and boulevard
Litter & housing abatement 21,712 393,876
Park development 2,219,436
Culture & recreation
Capital improvements
Economic development 1,413
Debt guarantee
Committed
Special revenue funds 521,177
Unassigned
Total fund balances 1,413 21,712 393,876 521,177 2,219,436
Total liabilities, deferrend inflows of
resources and fund balances 69,139$ 24,212$ 394,916$ 521,177$ 2,219,436$
Continued on next page
Combining Balance Sheet
Nonmajor Special Revenue Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
104
Total
Stadium/Nonmajor
Capital Economic Convention Special
Improvements Development Center Revenue
ASSETS
Cash & cash equivalents 5,336,481$ 1,754,884$ 594,738$ 18,470,022$
Restricted cash:
Customer deposits 122,541
Cemetery endowment -
Debt service -
Investments 3,382,546 504,883 6,373,550
Receivables (net of allowances):
Taxes 134,185 37,186 560,865
Customers 1,759,807
Interfund loans 106,971
Grants 328,288
Special assessments & loans 124,780
Total assets 8,853,212 2,259,767 631,924 27,846,824
LIABILITIES
Accounts payable 46,674 5,000 1,016,393
Interfund loans payable 2,000,000
Due to other funds 762,670
Deposits payable from restricted assets 115,120
Total liabilities - 46,674 5,000 3,894,183
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 239,240
FUND BALANCES
Nonspendable
Cemetery permanent fund -
Restricted
Street and boulevard 8,635,462
Litter & housing abatement 415,588
Park development 2,219,436
Culture & recreation 98,638
Capital improvements 8,853,212 8,853,212
Economic development 96,235
Debt guarantee -
Committed
Special revenue funds 2,213,093 626,924 3,394,830
Unassigned -
Total fund balances 8,853,212 2,213,093 626,924 23,713,401
Total liabilities, deferrend inflows of
resources and fund balances 8,853,212$ 2,259,767$ 631,924$ 27,846,824$
Combining Balance Sheet
Nonmajor Special Revenue Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
105
Community
City Arterial I-182 Traffic Street Development
Street Street Impact Overlay Block Grant
REVENUES
Taxes 252,756$ 1,013,264$ -$
Licenses and permits 306,280 -
Intergovernmental revenue 1,039,158 519,492 840,257
Charges for services 152,430 709 407,362 -
Fines and forfeitures -
Miscellaneous revenue 21,456 16,209 14,525 55,855 10,000
Total revenues 1,772,080 536,410 421,887 1,069,119 850,257
EXPENDITURES
Current:
Public safety -
Transportation 2,029,626 8,623 1,390 204,617 -
Natural and economic environment 336,088
Culture and recreation -
Capital outlay:-
Public safety -
Natural and economic environment -
Culture and recreation -
Debt service:-
Principal -
Interest -
Total expenditures 2,029,626 8,623 1,390 204,617 336,088
Excess of revenues
over expenditures (257,546) 527,787 420,497 864,502 514,169
OTHER FINANCING SOURCES (USES)
Transfers in -
Transfers out (784,502) (237,695) (202,921) (481,520)
Total other financing sources (uses)- (784,502) (237,695) (202,921) (481,520)
Net change in fund balances (257,546) (256,715) 182,802 661,581 32,649
Fund balances - beginning 109,102 1,294,961 908,771 3,821,493 62,173
Fund balances - ending (148,444)$ 1,038,246$ 1,091,573$ 4,483,074$ 94,822$
Continued on next page
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
106
M.L. King
Community Ambulance City View Boulevard Athletic
Center Services Cemetery Perpetual Program
REVENUES
Taxes
Licenses and permits
Intergovernmental revenue 1,309,352
Charges for services 4,668,870 295,835 167,825 151,727
Fines and forfeitures
Miscellaneous revenue 49,160 26,946 1,635 41,477 2,547
Total revenues 49,160 6,005,168 297,470 209,302 154,274
EXPENDITURES
Current:
Public safety 7,247,682
Transportation 4,229
Natural and economic environment 270,406
Culture and recreation 131,150 123,581
Capital outlay:
Public safety 42,302
Natural and economic environment 5,679
Culture and recreation
Debt service:
Principal
Interest 34,027
Total expenditures 131,150 7,324,011 276,085 4,229 123,581
Excess of revenues
over expenditures (81,990) (1,318,843) 21,385 205,073 30,693
OTHER FINANCING SOURCES (USES)
Transfers in 67,287 420,000
Transfers out (137,600)
Total other financing sources (uses)67,287 420,000 - (137,600) -
Net change in fund balances (14,703) (898,843) 21,385 67,473 30,693
Fund balances - beginning 184,378 433,046 48,141 2,003,048 237,471
Fund balances - ending 169,675$ (465,797)$ 69,526$ 2,070,521$ 268,164$
Continued on next page
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
107
Rivershore Trail
Golf Senior Multi-Modal School & Marina
Course Center Facility Impact Fees Maintenance
REVENUES
Taxes
Licenses and permits
Intergovernmental revenue 14,973 100,866
Charges for services 1,712,875 14,165 2,355,675
Fines and forfeitures
Miscellaneous revenue 316,157 16,009 81,763 369,222
Total revenues 2,029,032 45,147 182,629 2,355,675 369,222
EXPENDITURES
Current:
Public safety
Transportation 173,628
Natural and economic environment 2,355,365
Culture and recreation 1,926,695 308,152 14,591
Capital outlay:
Public safety
Natural and economic environment
Culture and recreation 737,123
Debt service:
Principal
Interest
Total expenditures 1,926,695 308,152 173,628 2,355,365 751,714
Excess of revenues
over expenditures 102,337 (263,005) 9,001 310 (382,492)
OTHER FINANCING SOURCES (USES)
Transfers in 281,640
Transfers out
Total other financing sources (uses)- 281,640 - - -
Net change in fund balances 102,337 18,635 9,001 310 (382,492)
Fund balances - beginning (3,699) 18,522 340,700 - 87,884
Fund balances - ending 98,638$ 37,157$ 349,701$ 310$ (294,608)$
Continued on next page
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
108
Special T.R.A.C.
Lodging Litter Revolving Development Park
Assessment Abatement Abatement & Operating Development
REVENUES
Taxes 342,052$
Licenses and permits
Intergovernmental revenue
Charges for services 333,345 9,688 77,650 519,304
Fines and forfeitures 128,497
Miscellaneous revenue 463 198 5,114 2,857 26,661
Total revenues 333,808 9,886 211,261 344,909 545,965
EXPENDITURES
Current:
Public safety
Transportation 10,237
Natural and economic environment 215,858
Culture and recreation 333,794 239,054 3,247
Capital outlay:
Public safety
Natural and economic environment
Culture and recreation
Debt service:
Principal
Interest
Total expenditures 333,794 10,237 215,858 239,054 3,247
Excess of revenues
over expenditures 14 (351) (4,597) 105,855 542,718
OTHER FINANCING SOURCES (USES)
Transfers in 5,000
Transfers out (46,457)
Total other financing sources (uses)- 5,000 - - (46,457)
Net change in fund balances 14 4,649 (4,597) 105,855 496,261
Fund balances - beginning 1,399 17,063 398,473 415,322 1,723,175
Fund balances - ending 1,413$ 21,712$ 393,876$ 521,177$ 2,219,436$
Continued on next page
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
109
Total
Nonmajor
Capital Economic Stadium/Special
Improvement Development Conv. Center Revenue
REVENUES
Taxes 2,343,929$ 342,078$ 4,294,079$
Licenses and permits 306,280
Intergovernmental revenue 392,639 4,216,737
Charges for services 10,867,460
Fines and forfeitures 128,497
Miscellaneous revenue 112,251 821,126 42,720 2,034,351
Total revenues 2,456,180 1,213,765 384,798 21,847,404
EXPENDITURES
Current:
Public safety 7,247,682
Transportation 2,432,350
Natural and economic environment 7,260 1,094,188 170,920 4,450,085
Culture and recreation 22,608 3,102,872
Capital outlay:
Public safety 42,302
Natural and economic environment 5,679
Culture and recreation 24,693 761,816
Debt service:
Principal -
Interest 3,705 37,732
Total expenditures 7,260 1,094,188 221,926 18,080,518
Excess of revenues
over expenditures 2,448,920 119,577 162,872 3,766,886
OTHER FINANCING SOURCES (USES)
Transfers in 56,004 829,931
Transfers out (575,702) (2,466,397)
Total other financing sources (uses)(575,702) 56,004 - (1,636,466)
Net change in fund balances 1,873,218 175,581 162,872 2,130,420
Fund balances - beginning 6,979,994 2,037,512 464,052 21,582,981
Fund balances - ending 8,853,212$ 2,213,093$ 626,924$ 23,713,401$
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
110
Total
Local Improv.Nonmajor
LID LID District Debt
Loans Bonds Guaranty Service
ASSETS
Cash & cash equivalents -$ 239,039$ 239,039$
Restricted cash:-
Customer deposits - -
Cemetery endowment - -
Debt service 31,232 22,182 100,442 153,856
Investments - -
Receivables (net of allowances):-
Taxes - -
Customers 28,081 28,081
Interfund loans - -
Grants - -
Special assessments & loans 96,720 27,992 124,712
Total assets 156,033 50,174 339,481 545,688
LIABILITIES
Accounts payable - -
Interfund loans payable 125,301 125,301
Due to other funds - -
Deposits payable from restricted assets - -
Total liabilities 125,301 - - 125,301
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 96,720 27,992 124,712
FUND BALANCES
Nonspendable
Cemetery permanent fund - -
Restricted -
Street and boulevard - -
Litter & housing abatement - -
Park development - -
Culture & recreation - -
Capital improvements - -
Economic development - -
Debt guarantee - 22,182 339,481 361,663
Committed -
Special revenue funds - -
Unassigned (65,988) (65,988)
Total fund balances (65,988) 22,182 339,481 295,675
Total liabilities, deferrend inflows of
resources and fund balances 156,033$ 50,174$ 339,481$ 545,688$
Combining Balance Shet
Nonmajor Debt Service Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
111
Total
Local Improv.Nonmajor
LID LID District Debt
Loans Bonds Guaranty Service
REVENUES
Miscellaneous revenue 78,701$ 8,721$ 3,303$ 90,725$
Total revenues 78,701 8,721 3,303 90,725
EXPENDITURES
Current:
Transportation 4,510 575 5,085
Natural and economic environment - -
Debt service:
Principal - 20,000 20,000
Interest 9,864 1,000 10,864
Total expenditures 14,374 21,575 - 35,949
Excess of revenues
over expenditures 64,327 (12,854) 3,303 54,776
OTHER FINANCING SOURCES (USES)
Transfers in - -
Transfers out - -
Total other financing sources (uses)- - - -
Net change in fund balances 64,327 (12,854) 3,303 54,776
Fund balances - beginning (130,315) 35,036 336,178 240,899
Fund balances - ending (65,988)$ 22,182$ 339,481$ 295,675$
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Debt Service Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
112
Original Final Variance to
Budget Budget Actual Final Budget
REVENUES
Intergovernmental revenue 9,398,000$ 9,398,000$ 7,273,596$ (2,124,404)$
Miscellaneous revenue 4,720,000 4,720,000 1,000 (4,719,000)
Total revenues 14,118,000 14,118,000 7,274,596 (6,843,404)
EXPENDITURES
Current:
General government 10,852 (10,852)
Public safety 126,506 (126,506)
Transportation 5,748 (5,748)
Culture and recreation 191,943 (191,943)
Capital outlay:
General government 1,883,792 1,883,792 363,905 1,519,887
Public safety 1,397,925 1,397,925 669,162 728,763
Transportation 14,567,861 14,567,861 8,083,713 6,484,148
Natural & economic environment 774,162 774,162 787 773,375
Culture and recreation 3,504,405 3,504,405 540,512 2,963,893
Total expenditures 22,128,145 22,128,145 9,993,128 12,135,017
Excess of revenues over (under) expenditures (8,010,145) (8,010,145) (2,718,532) (5,291,613)
OTHER FINANCING SOURCES
Debt proceeds and other miscellaneous 1,320,000 1,320,000 1,320,000
Transfers in 6,690,145 6,780,145 2,332,477 4,447,668
Transfers out (86,666) 86,666
Total other financing sources 8,010,145 8,100,145 2,245,811 4,534,334
Net change in fund balances - 90,000 (472,721) (562,721)
Prior period adjustments see (note 17)- - 16,787 16,787
Fund balances - beginning balance - - 556,633 556,633
CONSTRUCTION FUND
Statement of Revenues, Expenditures, and Changes in Fund Balances-Budget to Actual
Construction Fund - Major Fund
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
113
Final Variance to Final Variance to
Budget Actual Final Budget Budget Actual Final Budget
Special Revenue Funds
City Street Fund 2,204,269$ 1,772,080$ (432,189)$ 2,344,269$ 2,029,626$ (314,643)$
Arterial Street Fund 523,773 536,410 12,637 1,091,123 793,125 (297,998)
I-82 Traffic Impact Fund 385,000 421,887 36,887 171,391 239,085 67,694
Street Overlay Fund 1,003,066 1,069,119 66,053 931,871 407,538 (524,333)
Community Dev Block Grant Fund 1,451,245 850,257 (600,988) 1,507,963 817,608 (690,355)
ML King Community Center Fund 114,900 116,447 1,547 163,139 131,150 (31,989)
Ambulance Services Fund 7,988,028 6,425,168 (1,562,860) 8,262,496 7,324,011 (938,485)
City View Cemetery Fund 266,140 297,470 31,330 278,130 276,085 (2,045)
Blvd Perpetual Maintenance Fund 389,515 209,302 (180,213) 141,828 141,829 1
Athletic Program Fund 150,690 154,274 3,584 153,383 123,581 (29,802)
Golf Course 1,904,000 2,029,032 125,032 1,894,269 1,926,695 32,426
Senior Center Fund 329,700 326,787 (2,913) 332,196 308,152 (24,044)
Multi-Modal Fund 183,784 182,629 (1,155) 191,823 173,628 (18,195)
School Impact Fees 2,750,000 2,355,675 (394,325) 2,750,000 2,355,365 (394,635)
Rivershore Trail & Marina Fund 719,600 369,222 (350,378) 713,710 751,714 38,004
Special Lodging Assess Fund 275,000 333,808 58,808 275,000 333,794 58,794
Litter Abatement Fund 17,550 14,886 (2,664) 15,145 10,237 (4,908)
Revolving Abatement Fund 186,000 211,261 25,261 212,934 215,858 2,924
TRAC Develop & Operating Fund 275,300 344,909 69,609 278,094 239,054 (39,040)
Park Development Fund 514,100 545,965 31,865 61,247 49,704 (11,543)
Capital Improvement Fund 1,728,000 2,456,180 728,180 4,414,260 582,962 (3,831,298)
Economic Development Fund 1,827,810 1,269,769 (558,041) 1,529,995 1,094,188 (435,807)
Stadium/Convention Ctr Fund 347,300 384,798 37,498 347,798 221,926 (125,872)
Total 25,534,770 22,677,335 (2,857,435) 28,062,064 20,546,915 (7,515,149)
Debt Service Funds
LID Loans 67,040 78,701 11,661 131,560 14,374 (117,186)
LID Bonds 25,748 8,721 (17,027) 21,575 21,575 -
LID Guarantee 1,000 3,303 2,303 - -
Total 93,788 90,725 (3,063) 153,135 35,949 (117,186)
Permanent Funds
Cemetery Perpetual Care 15,200 26,060 10,860 - - -
Total 15,200$ 26,060$ 10,860$ -$ -$ -$
Schedule of Revenues and Expenditures - Budget to Actual
For the Year Ended December 31, 2018
Nonmajor Other Governmental Funds
Revenues Expenditures
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
114
SUN WILLOWS GOLF COURSE
VOLUNTEER PARK
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
115
Enterprise funds are used to account for the financing of goods or services for which a fee is charged
to external users for use of those goods and services. The City of Pasco does not have any nonmajor
enterprise funds.
Internal service funds are used to account for the financing of goods or services provided by one
department to other departments of the government and to other government units on a cost
reimbursement basis.
Nonmajor Proprietary Funds
Enterprise Funds
Internal Service Funds
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
116
Medical/
Equipment Equipment Dental Equipment Equipment Total
Rental Rental Insurance Central Rental Rental Internal
Operations Replacement Fund Stores Operations Replacement Service
ASSETS
Current assets:
Current cash & cash equivalents 381,827$ 4,127,671$ 1,815,101$ 13,209$ 29,735$ 3,400,513$ 9,768,056$
Restricted cash - IBNR 1,848,008 1,848,008
Investments 3,070,100 634,864 822,175 4,527,139
Receivables 1,212 - 1,212
Total current assets 383,039 7,197,771 4,297,973 13,209 29,735 4,222,688 16,144,415
Noncurrent assets:
Machinery and equipment 5,626,400 - 1,653,459 7,279,859
Total noncurrent assets - 5,626,400 - - - 1,653,459 7,279,859
Total assets 383,039 12,824,171 4,297,973 13,209 29,735 5,876,147 23,424,274
DEFERRED OUTFLOWS
Pension related 25,980 - 25,980
LIABILITIES
Current liabilities:
Accounts payable 56,599 (237,027) 22,351 418,247 260,170
IBNR payable from restricted assets 1,848,008 1,848,008
Total current liabilities 56,599 - 1,610,981 - 22,351 418,247 2,108,178
Noncurrent liabilities:
Pension liability 124,371 - 124,371
Total noncurrent liabilities 124,371 - - - - - 124,371
Total liabilities 180,970 - 1,610,981 - 22,351 418,247 2,232,549
DEFERRED INFLOWS
Pension related 52,570 - 52,570
NET POSITION
Net investment in capital assets 5,626,400 - 1,653,459 7,279,859
Unrestricted 175,479 7,197,771 2,686,992 13,209 7,384 3,804,441 13,885,276
Total net position 175,479$ 12,824,171$ 2,686,992$ 13,209$ 7,384$ 5,457,900$ 21,165,135$
Business-Type ActivitiesGovernmental Activities
Combining Statement of Net Position
Nonmajor Internal Services Fund
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
117
Equipment Equipment Medical/Dental Equipment Equipment Total
Rental Rental Insurance Central Rental Rental Internal
Operations Replacement Fund Stores Operations Replacement Service
OPERATING REVENUES
Charges for goods and services 1,046,848$ 1,621,435$ 6,479,592$ 354,484$ 628,218$ 10,130,577$
Total operating revenues 1,046,848 1,621,435 6,479,592 - 354,484 628,218 10,130,577
OPERATING EXPENSES
Depreciation 735,191 - 275,098 1,010,289
Salaries & wages 255,177 28,869 158,579 442,625
Personnel benefits 108,461 10,121 64,910 183,492
Supplies 632,148 160,996 - 205,492 5,087 1,003,723
Services 202,206 6,159,816 39,740 6,401,762
Total operating expenses 1,197,992 896,187 6,198,806 - 468,721 280,185 9,041,891
OPERATING INCOME (LOSS)(151,144) 725,248 280,786 - (114,237) 348,033 1,088,686
NONOPERATING REVENUES (EXPENSES)
Investment income 3,773 50,344 44,020 129 688 39,207 138,161
Investment gain (loss)48,513 13,640 16,839 78,992
Miscellaneous 10,397 46,181 64,126 5,626 126,330
Gain (Loss) on disposal of capital assets - 8,222 8,222
Total nonoperating revenues 14,170 145,038 121,786 129 6,314 64,268 351,705
Income (loss) before contributions and transfers (136,974) 870,286 402,572 129 (107,923) 412,301 1,440,391
Capital contributions - -
Transfers out (75,000) (75,000)
Transfers in 75,000 75,000
Changes in net position (136,974) 870,286 402,572 129 (107,923) 412,301 1,440,391
Net position - beginning 312,453 11,953,885 2,284,420 13,080 115,307 5,045,599 19,724,744
Net position - ending 175,479$ 12,824,171$ 2,686,992$ 13,209$ 7,384$ 5,457,900$ 21,165,135
Governmental Activities
Combining Statement of Revenues, Expenses, and Changes in Net Position
Nonmajor Internal Service Funds
For the Year Ended December 31, 2018
Business-Type Activities
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
118
Equipment Equipment Equipment Equipment Total
Rental Rental Medical Central Rental Rental Internal
Operations Replacement Insurance Stores Operations Replacement Service
CASH FLOW FROM OPERATING ACTIVITIES:
Cash from customers 1,045,636$ 1,621,435$ 6,479,592$ -$ 354,484$ 628,218$ 10,129,365$
Payments to employees (359,583) - (38,990) - (223,489) - (622,062)
Payments to suppliers (847,383) (199,166) (6,004,172) - (253,132) 413,160 (6,890,693)
Net cash provided by operating activities (161,330) 1,422,269 436,430 - (122,137) 1,041,378 2,616,610
CASH FLOWS FROM NON-CAPITAL
FINANCING ACTIVITIES
Miscellaneous 10,397 46,181 64,126 - 5,626 - 126,330
10,397 46,181 64,126 - 5,626 - 126,330
CASH FLOW FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Proceeds from disposal of assets - 48,513 - - - 16,840 65,353
Acquisition of capital assets - (477,578) - - - (457,590) (935,168)
Net cash used in capital activities - (429,065) - - - (440,750) (869,815)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment sales and income 3,773 50,344 833,899 129 688 48,222 937,055
Investment purchases - 334,845 - - - 690,389 1,025,234
Interfund loans - 14,567 - - - - 14,567
Net cash provided from investing activities 3,773 399,756 833,899 129 688 738,611 1,976,856
Net increase in cash and cash equivalents (147,160) 1,439,141 1,334,455 129 (115,823) 1,339,239 3,849,981
Beginning cash and cash equivalents 528,987 2,688,530 2,328,654 13,080 145,558 2,061,274 7,766,083
Ending cash and cash equivalents 381,827$ 4,127,671$ 3,663,109$ 13,209$ 29,735$ 3,400,513$ 11,616,064$
CASH PROVIDED BY OPERATING
ACTIVITIES:
Net operating income (loss)(151,144)$ 725,248$ 280,786$ -$ (114,237)$ 348,033$ 1,088,686$
ADJUSTMENTS TO RECONCILE OPERATING
INCOME TO NET CASH PROVIDED BY
OPERATING ACTIVITIES
Depreciation - 735,191 - - - 275,098 1,010,289
(Increase)/decrease in customer receivables (1,212) - - - - - (1,212)
Increase (decrease) in accounts payable (13,029) (38,170) 155,644 - (7,900) 418,247 514,792
(Increase) decrease in pension deferred outflow (586) - - - - - (586)
Increase (decrease) in pension obligation (22,703) - - - - - (22,703)
Increase (decrease) in pension deferred inflow 27,344 - - - - - 27,344
Net cash provided by operating activities (161,330)$ 1,422,269$ 436,430$ -$ (122,137)$ 1,041,378$ 2,616,610$
Combining Statement of Cash Flows
Nonmajor Internal Service Funds
For the Year Ended December 31, 2018
Governmental Activities Business-Type Activities
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
119
Pension and other post-employment benefit trust funds are used to report resources that are required to be
held in trust for the members and beneficiaries of defined benefit pension plans, defined contribution
plans, other postemployment benefit plans or other employee benefit plans.
Agency funds are used to report resources held by the reporting government in a purely custodial capacity.
Agency funds typically involve only the receipt, temporary investment, and remittance of fiduciary
resources to individuals, private organizations, or other governments.
Trust and Agency Funds
Pension and Other Postemployment Benefit Trust Funds
Agency Funds
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
120
Total
Firemen's Other Pension and Other
Firemen's Post-Employment Post-Employment
Pension Benefits Benefits
ASSETS
Cash 440,529$ 1,005$ 441,534$
Receivables
Interfund Loan 18,330 18,330
Investments at fair market value:
Federal agency 19,368 19,368
Mutual funds 2,084,823 2,844,174 4,928,997
Total assets 2,563,050 2,845,179 5,408,229
LIABILITIES
Total liabilities - - -
NET POSITION
Held in trust for pension benefits
and other purposes 2,563,050$ 2,845,179$ 5,408,229$
Combining Statement of Net Position
Fiduciary Funds
December 31, 2018
Trust Funds
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
121
Public Animal
Flexible Facility Control Payroll Total
Spending District Authority Clearing Agency
ASSETS
Cash & cash equivalents 33,877$ 74,103$ 1,176$ 261,728$ 370,884$
Total assets 33,877 74,103 1,176 261,728 370,884
LIABILITIES
Accounts payable 33,877 261,728 295,605
Due to other governments - 74,103 1,176 75,279
Total liabilities 33,877$ 74,103$ 1,176$ 261,728$ 370,884$
Agency Funds
Combining Statement of Assets and Liabilities
Agency Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
122
Total
Firemen's Other Pension and Other
Firemen's Post-Employment Post-Employment
Pension Benefits Benefits
ADDITIONS
Taxes 73,414$ 73,414$
Investment earnings
Interest (181,110)(142,068)(323,178)
Dividends 41,675 57,075 98,750
Total additions (66,021) (84,993) (151,014)
DEDUCTIONS
Pension benefits 128,399 128,399
Medical premiums 87,540 87,540
Services 4,923 5,661 10,584
Total deductions 133,322 93,201 226,523
Change in net assets (199,343) (178,194) (377,537)
Net position - beginning 2,762,393 3,023,373 5,785,766
Net position - ending 2,563,050$ 2,845,179$ 5,408,229$
Combining Statement of Changes in Net Position
Fiduciary Funds
For The Year Ended December 31, 2018
Trust Funds
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
123
Balance Balance Balance Balance
January 1 Additions Deletions December 31 January 1 Additions Deletions December 31
ASSETS
Cash & cash equivalents 35,185$ 148,534$ 149,842$ 33,877$ 57,407$ 16,696$ -$ 74,103$
Total assets 35,185 148,534 149,842 33,877 57,407 16,696 - 74,103
LIABILITIES
Accounts payable 35,185 148,534 149,842 33,877 -
Due to other governments - 57,407 16,696 - 74,103
Total liabilities 35,185$ 148,534$ 149,842$ 33,877$ 57,407$ 16,696$ -$ 74,103$
continued
Pasco Public Facility DistrictFlexible Spending Accounts
Combining Statement of Changes in Assets and Liabilities
Agency Funds
For the Year Ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
124
Balance Balance Balance Balance
January 1 Additions Deletions December 31 January 1 Additions Deletions December 31
ASSETS
Cash & Cash Equivalents 54,883$ -$ 53,707$ 1,176$ 496,299$ 40,792,664$ 41,027,235$ 261,728$
Total Assets 54,883 - 53,707 1,176 496,299 40,792,664 41,027,235 261,728
LIABILITIES
Accounts payable - 496,299 43,137,368 43,371,939 261,728
Due to Other Governments 54,883 - 53,707 1,176
Total Liabilities 54,883$ -$ 53,707$ 1,176$ 496,299$ 43,137,368$ 43,371,939$ 261,728$
Payroll ClearingAnimal Control Authority
Combining Statement of Assets and Liabilities
Agency Funds
December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
125
STATISTICAL SECTION
This part of the City of Pasco’s comprehensive annual financial report presents detailed information as a
context for understanding what the information in the financial statements, note disclosures and required
supplementary information says about the government’s overall financial health.
CONTENTS Page
Financial Trends 126
These schedules contain trend information to help the reader understand how the government’s financial
performance and well-being have changed over time.
Revenue Capacity 131
These schedules contain information to help the reader assess the government’s most significant revenue
sources.
Debt Capacity 136
These schedules present information to help the reader assess the affordability of the government’s
current levels of outstanding debt and the government’s ability to issue additional debt in the future.
Demographic and Economic Information 141
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the government’s financial activities take place.
Operating Information 144
These schedules contain service data to help the reader understand how the information in the
government’s financial report relates to services the government provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial
reports for the relevant year.
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
126
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Governmental activities
Net investment in capital assets $97,602 $122,343 $141,497 $163,582 $188,996 $185,424 $198,278 $212,712 $217,060 $236,868
Restricted for:
Restricted *3,551 383 400
Cemetery (nonexpendable) 418 434 455 468 486 505 531
Prepaids 141
Program, grant, donations 86 35 44 19
Contested tax & drug forefits 228 57
Bicentennial celebration 6
Streets and boulevards 6,489 7,205 7,150 6,204 6,986 7,996 8,635
Litter and housing abatement 289 329 369 354 562 416 416
Park development 1,739 1,821 1,994 2,135 2,152 1,723 2,219
Culture and recreation 133 (4) 99
Capital improvement 2,259 2,976 3,733 4,802 5,927 6,980 8,853
Economic development 221 3 49 108 114 64 96
General obligation debt 337 334 349 635 371 362
Special assessment debt 240 48 64 6,240
Committed for:
Landfill*407 407
Special revenue funds*4,408 3,395
Construction projects*557 101
Unrestricted 24,111 28,241 30,166 14,616 11,883 15,934 10,433 16,576 6,301 14,307
Total governmental activities net position 125,264 150,967 172,063 190,196 214,390 215,719 229,108 246,185 246,828 276,308
Business-type activities
Net investment capital assets 136,995 124,771 129,532 130,321 129,664 137,088 139,166 141,470 141,373 147,338
Restricted 777 - - 10,841
Unrestricted 12,618 11,400 12,367 14,719 19,115 4,274 15,736 19,860 26,339 32,149
Total business-type activities net position 150,390 136,171 141,899 145,040 148,779 152,203 154,902 161,330 167,712 179,487
Primary government
Net investment in capital assets 211,596 247,114 271,029 293,903 318,660 322,512 337,444 354,182 358,433 384,206
Restricted 4,328 383 400 11,998 13,511 14,361 20,397 16,897 18,095 21,230
Committed*- - - - - - - - 5,372 3,903
Unrestricted 36,729 39,641 42,533 29,335 30,998 20,208 26,169 36,436 32,640 46,456
Total primary government net assets $252,653 $287,138 $313,962 $335,236 $363,169 $357,081 $384,010 $407,515 $414,540 $455,795
* Break out not available prior to 2012
** Break out not reported prior to 2017
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
Fiscal Year Ended December 31
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
127
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Expenses
Governmental activities:
General government $12,059 $6,921 $6,517 $6,730 $7,060 $8,092 $8,238 $8,716 $7,594 $6,950
Public safety 18,743 19,419 19,834 20,498 22,491 21,624 24,917 29,374 30,661 32,470
Physical environment 3,050 1,900 2,406 2,992
Transportation 5,137 7,831 9,836 9,913 14,097 16,728 16,374 16,628 17,893 18,047
Economic environment 1,385 797 1,041 2,386 4,456 4,710 5,137 5,618 6,894 6,873
Health and human services 59 1,652 251 421
Culture and recreation 6,212 4,724 7,695 8,224 8,003 7,941 8,115 8,929 9,168 9,490
Interest on long term debt 413 512 517 315 265 210 444 504 438 421
Total governmental activities expenses 47,058 43,756 48,097 51,479 56,372 59,305 63,225 69,769 72,648 74,251
Business-type activities
Water 6,029 6,538 6,845 6,748 7,780 8,238 9,099 9,476 10,172 10,285
Irrigation 1,009 1,045 1,038 1,099 1,226 1,546 1,779 1,646 1,993 1,914
Sewer 6,826 6,944 7,922 7,435 7,223 7,902 8,175 8,571 8,986 9,309
Water process reuse 1,558 1,444 1,501 1,185 1,542 1,848 2,524 3,173 2,590 2,508
Storm water 735 791 959 1,028 1,165 1,288 1,168 1,531 1,303 1,395
Total business-type activities expenses 16,157 16,762 18,265 17,495 18,936 20,822 22,745 24,397 25,044 25,411
Total primary government expenses 63,215 60,518 66,362 68,974 75,308 80,127 85,970 94,166 97,692 99,662
Program revenues
Governmental Activities:
Charges for Services
General government 8,982 2,134 1,981 2,575 4,578 5,083 5,283 4,741 4,759 6,108
Public safety 3,006 3,684 3,893 4,415 4,398 5,144 5,177 6,310 8,525 8,808
Physical environment 1,282 499 1,331 1,406
Transportation 623 1,504 1,795 310 3,507 4,203 3,672 3,771 2,609 2,319
National & economic environment 1,431 17 1,459 2,734 3,361 3,172 3,570 6,022 6,096 6,075
Health and human services 1,851 30 14
Culture and recreation 480 604 2,161 1,838 2,471 2,334 2,502 2,556 2,905 3,864
Operating grants and contributions 504 1,448 1,763 1,043 639 1,702 1,770 1,321 1,041 1,614
Capital grants and contributions 13,283 25,488 25,117 16,144 30,631 4,302 23,929 25,053 14,189 31,756
Total governmental activities program revenues 29,591 37,229 39,530 30,479 49,585 25,940 45,903 49,774 40,124 60,544
Business-type activities
Charges for services 18,319 18,148 17,774 18,044 17,977 20,002 20,979 23,603 25,816 28,172
Operating grants and contributions 0 0 370 412 42 23 27 11 69 1,048
Capital grants and contributions 3,061 4,654 5,671 5,586 4,214 3,344 6,090 7,189 5,267 7,395
Total business-type activities program revenues 21,380 22,802 23,815 24,042 22,233 23,369 27,096 30,803 31,152 36,615
Total primary government program revenues $50,971 $60,031 $63,345 $54,521 $71,818 $49,309 $72,999 $80,577 $71,276 $97,159
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
Fiscal Year Ended December 31
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
128
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Net (expenses)/revenues
Governmental activities ($17,467)($6,527)($8,567)($21,000)($6,787)($33,365)($17,322)($19,995)($41,048)($13,707)
Business-type activities 5,223 6,040 5,550 6,547 3,297 2,547 4,351 6,406 6,108 11,204
Total primary government (12,244)(487)(3,017)(14,453)(3,490)(30,818)(12,971)(13,589)(34,940)(2,503)
General revenues and other changes in net assets
Governmental Activities:
Taxes
Property taxes 6,276 6,080 6,847 6,658 7,149 7,069 7,255 7,928 7,963 8,353
Sales and use taxes 8,000 8,245 9,403 10,284 11,472 12,695 13,646 14,887 15,818 16,696
Occupational utility taxes 8,924 8,917 8,914 8,843 8,894 9,592 10,268 9,028 10,512 10,104
Other taxes 4,686 1,738 1,838 2,046 2,117 2,290 2,443 2,884 3,487 3,636
Intergovernmental *1,663 2,599 3,161 1,566 1,581 1,741 1,962 3,609 3,589
Investment and miscellaneous 852 1,147 691 1,486 137 62 252 300 485 871
Transfers 566 (149)3,439 (355)(150)- - (65) (78)
Total governmental activities 29,304 27,641 30,292 35,917 30,980 33,139 35,605 36,989 41,809 43,171
Business-type activities
Investment and miscellaneous 399 1,062 177 33 88 29 103 145 209 571
Transfers (566)149 (3,439)355 150 - - 65 -
Total business-type activities (167)1,211 177 (3,406)443 179 103 145 274 571
Total primary government 29,137 28,852 30,469 32,511 31,423 33,318 35,708 37,134 42,083 43,742
Changes in net position
Governmental activities 11,837 21,114 21,725 14,917 24,193 (226)18,283 16,994 761 29,464
Business-type activities 5,056 7,251 5,727 3,141 3,740 2,726 4,454 6,551 6,382 11,775
Total primary government $16,893 $28,365 $27,452 $18,058 $27,933 $2,500 $22,737 $23,545 $7,143 $41,239
*Included with "Other taxes" until 2010.
Fiscal Year Ended December 31
Changes in Net Position
Last Ten Fiscal Years (continued)
(accrual basis of accounting)
(amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
129
Fiscal Year
Ended
December 31
Property
Taxes
Sales and
Use Taxes B&O Taxes
Excise and Other
Taxes Total Taxes
2009 6,276 8,000 8,924 4,686 *27,886
2010 6,080 8,245 8,917 1,739 24,981
2011 6,847 9,403 8,914 1,838 27,002
2012 6,659 10,284 8,843 2,046 27,832
2013 7,149 11,472 8,894 2,117 29,632
2014 7,069 12,695 9,592 2,290 31,646
2015 7,255 13,646 10,268 2,443 33,612
2016 7,928 14,887 9,028 2,884 34,727
2017 7,963 15,818 10,512 3,487 37,780
2018 8,353 16,696 10,104 3,636 38,789
Source:
Statement of activities
Prior CAFR
* Also included intergovernmental revenues
Governmental Activities Tax Revenues by Source
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
130
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
General fund
Assigned -$ -$ 3,208$ -$ -$ -$ -$ -$ -$ -$
Restricted
Prepaids 136
Program, grant, donation 86 35 44 19
Bi-centennial celebration 6
Law Enforcement 228 57
Debt Repayment/guarantee 4,876
Committed
Landfill claims 401 405 406 407 407 407 407
Assigned
Subsequent year's budget appropriation 2,872 806 1,858
Unassigned 8,050 6,264 5,612 7,978 11,920 12,333 13,118 15,365
Reserved *1,898
Unreserved *7,917 9,414
Total general fund 9,815$ 9,414$ 11,258$ 9,543$ 6,245$ 9,383$ 17,289$ 14,633$ 13,569$ 15,791$
All other governmental funds
Nonspendable
Cemetery permanent fund -$ -$ 400$ 418$ 434$ 455$ 467$ 486$ 505$ 531$
Restricted 9,496 5
Street and boulevard**6,489 7,205 7,150 6,204 6,986 7,997 8,635
Litter & housing abatement**288 329 369 354 562 416 416
Park development**1,739 1,822 1,995 2,135 2,152 1,723 2,219
Culture and recreation 132 (4) 98
Capital improvements**2,260 2,976 3,733 4,802 5,927 6,980 8,853
Economic development**221 3 49 108 115 63 96
Debt repayment/guarantee 1,364 635 371 362
General obligation debt**337 334 349
Special assessment debt**240 47 64
Committed 5,375
Special revenue funds*1,117 2,365 2,031 3,017 3,770 4,408 3,395
Construction projects*861 199 33 238 226 101
Debt guarantee*1,033 924 926
Unassigned (178) (1,254) (1,188) (442) (400) (279) (130) (66)
Reserved *2,798 383
Unreserved, reported in:
Special revenue funds 9,010 10,846
Debt service funds 1,307 1,095
Capital project funds (655) 833
Total all other governmental funds 12,460$ 13,157$ 15,093$ 13,749$ 15,582$ 16,717$ 18,289$ 20,580$ 22,329$ 24,640$
* Prior to GASB 54
*'* Break out not available prior to 2012
Fiscal Year Ended December 31
Fund Balance of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
131
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenue
Taxes 25,339$ 24,960$ 26,832$ 28,017$ 29,602$ 31,756$ 33,587$ 34,727$ 37,781$ 38,789$
Licenses and permits 1,860 1,966 1,874 1,862 1,777 1,983 3,389 2,516 2,576 2,947
Intergovernmental revenue 4,041 7,929 8,252 4,901 5,785 6,868 5,857 5,280 7,951 13,867
Charges for services 5,285 5,502 7,475 9,509 11,486 12,562 11,598 15,538 18,438 18,174
Fines and forfeitures 1,063 944 955 891 985 961 1,209 984 960 1,072
Investment and miscellaneous 2,963 2,930 2,547 2,767 2,559 3,146 2,264 2,956 2,792 3,769
Total revenues 40,551 44,231 47,935 47,947 52,194 57,276 57,904 62,001 70,498 78,618
Expenditures
Current:
General government 5,847 6,547 6,087 6,381 6,705 7,720 7,940 8,567 8,839 10,041
Public safety 18,418 18,820 18,780 19,990 22,365 22,110 25,269 27,205 32,253 33,254
Physical environment 2,066 1,855 2,288 2,846
Transportation 1,566 2,149 2,447 2,890 3,897 6,344 5,273 4,147 4,449 4,057
Natural and economic enviroment 944 54 872 2,137 4,287 4,568 4,989 5,446 6,786 6,674
Health and human services 59 1,313 210 376
Culture and recreation 4,670 4,757 6,402 6,807 6,978 7,153 7,357 8,131 8,763 8,833
Capital outlay *7,718
General government 104 154 193 1,426 506 166 206 268 424
Public safety 124 35 648 2,726 258 3,274 5,606 1,053 789
Physical environment 868 7
Transportation 3,441 3,276 3,141 2,994 2,852 2,203 995 4,152 8,084
Natural and economic enviroment 419 657 1,527 254 1,351 518 (23) 26
Culture and recreation 2,633 369 185 225 471 845 1,352 1,302
Debt service:
Principal 1,249 1,178 1,575 3,308 1,194 675 581 1,291 807 815
Interest 413 512 517 316 265 210 445 504 438 421
Total expenditures 42,950 44,774 43,669 50,752 53,091 53,972 57,968 63,461 69,137 74,720
Excess of revenues
over (under) expenditures (2,399) (543) 4,266 (2,805) (897) 3,304 (64) (1,460) 1,361 3,898
Other financing sources (uses)
Disposition of capital assets 227 700 1,010 67 140
Proceeds of general debt 795 4,533 8,795
Debt proceeds - Premiums 308
Debt refinanced (4,280)
Insurance recoveries 251 (1)
Transfer in 5,432 6,559 5,229 6,434 7,029 3,800 7,352 10,228 6,466 3,399
Transfer out (4,527) (6,708) (5,229) (6,689) (7,596) (4,343) (7,613) (10,228) (6,531) (3,477)
Total other financing sources (uses)1,156 645 253 (255) (567) (316) 9,542 1,010 2 62
Net change in fund balances (1,243)$ 102$ 4,519$ (3,060)$ (1,464)$ 2,988$ 9,478$ (450)$ 1,363$ 3,960$
Debt services as percentage
of noncapital expenditures 4.7%4.5%5.4%7.8%3.0%1.8%1.9%3.0%1.9%1.8%
* Breakout not available prior to 2010
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(amounts expressed in thousands)
Fiscal Year Ended December 31
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
132
Fiscal Year
Ended
December 31
Residential
Property
Commercial
Property
Other
Property
Total Taxable
Assessed
Valuation
Total
Direct Tax
Rate
2009 1,525,399 869,876 539,517 2,934,792 2.23
2010 2,151,661 577,476 172,776 2,901,913 2.22
2011 2,216,469 582,468 209,591 3,008,528 2.18
2012 2,323,387 716,283 180,219 3,219,889 2.17
2013 2,433,119 731,717 165,958 3,330,794 2.16
2014 2,455,759 833,089 192,151 3,480,999 2.00
2015 2,615,824 914,211 201,939 3,731,974 1.99
2016 2,616,243 911,431 198,327 3,726,001 1.98
2017 3,158,813 1,198,038 229,222 4,586,073 1.88
2018 3,556,588 1,423,538 273,940 5,254,066 1.75
Source: Franklin County Assessor
Real Property
Assessed Value of Taxable Property
Last Ten Fiscal Years
(in thousands of dollars)
Fiscal Year
Ended
December 31 Admissions Cable TV Solid Waste Water Irrigation *Sewer Storm **Reuse **Gas Telephone Electricity Total
2009 136 369 491 646 820 962 2,142 3,382 8,948
2010 149 383 515 709 821 925 2,059 3,356 8,917
2011 142 381 530 658 81 636 63 127 809 2,034 3,455 8,916
2012 148 391 536 679 85 647 91 158 707 1,910 3,489 8,841
2013 157 404 512 689 89 666 97 124 525 1,711 3,465 8,439
2014 158 516 573 782 107 665 108 186 790 1,839 4,026 9,750
2015 160 532 660 809 115 680 124 191 829 1,695 4,635 10,430
2016 129 457 649 860 121 765 129 285 530 1,413 3,819 9,157
2017 122 552 764 914 138 842 134 295 794 1,361 4,707 10,623
2018 126 440 797 921 175 834 144 245 746 1,290 4,407 10,125
* Previously included in Water
** Previously included in Sewer
B&O Taxes by Type
Last Ten Fiscal Years
(in thousands of dollars)
(Gross Revenues times 8 1/2% Tax Rate)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
133
Fiscal Year
Ended
December 31
Operating
millage
Debt
service
millage
Total city
millage
Operating
millage
Debt
service
millage
Total
county
millage
Operating
millage
Debt
service
millage
Total
school
millage
Special
districts
Total direct
and
overlapping
rates
2009 2.004 0.230 2.234 1.459 0.261 1.720 4.170 3.081 7.251 0.347 11.552
2010 1.999 0.225 2.224 1.478 0.238 1.716 4.155 2.395 6.550 0.338 10.828
2011 1.972 0.212 2.184 1.422 0.216 1.638 4.359 2.286 6.645 0.329 10.796
2012 1.968 0.203 2.171 1.440 0.214 1.654 4.352 2.250 6.602 0.033 10.460
2013 1.967 0.197 2.164 1.508 0.201 1.709 4.455 2.207 6.662 0.329 10.864
2014 1.956 0.045 2.001 1.352 0.135 1.487 4.314 2.528 6.842 0.323 10.653
2015 1.946 0.042 1.988 1.308 0.124 1.432 4.389 2.497 6.886 0.313 10.619
2016 1.937 0.039 1.976 1.401 0.113 1.514 4.318 2.390 6.708 0.311 10.509
2017 1.880 0.000 1.880 1.327 0.099 1.426 4.271 2.252 6.523 0.295 10.124
2018 1.746 0.000 1.746 1.262 0.098 1.360 3.947 2.004 5.951 0.280 9.337
Source: Franklin County Assessors (Property tax booklet)
1 Overlapping rates are those of local and county governments that apply to property owners within the City of Pasco. Not all overlapping rates apply to
all City of Pasco property owners whose property is located within the geographic boundaries of the special district.
City of Pasco
Property Tax Rates
Direct and Overlapping 1 Governments
Last Ten Fiscal Years
Overlapping Rates
School DistrictCounty
Fiscal Year
Ended
December 31 City of Pasco 1 Franklin County 1
2009 802,641,083 917,095,762
2010 825,267,329 964,584,879
2011 839,174,222 1,007,226,337
2012 861,063,371 1,037,096,483
2013 933,301,814 1,110,257,463
2014 1,016,794,531 1,196,017,085
2015 1,125,060,910 1,315,962,291
2016 1,250,472,836 1,428,477,621
2017 1,333,597,814 1,534,638,802
2018 1,412,016,075 1,630,212,414
1 Source: Washington State Department of Revenue
Taxable Retail Sales
Last Ten Fiscal Years
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
134
Taxpayer
Taxable
assessed value Rank
Percentage
of total
taxable
assessed
Taxable
assessed
value Rank
Percentage
of total
taxable
assessed
Autozone Parts Inc 37,599$ 1 0.78%
Simplot-RDO LLC 37,365 2 0.78%
Kenyon Zero Storage 35,233 3 0.73%
Syngenta Seeds LLC 31,457 4 0.66%36,987 1 1.20%
Pasco Processing LLC 29,496 5 0.61%27,530 2 0.90%
Twin City Foods, Inc.27,542 6 0.57%19,049 4 0.60%
Grimmway Enterprises 25,066 7 0.52%
Crossing at Chapel Hill ICG LLC 22,766 8 0.47%16,085 5 0.50%
Columbia Villas LLC 22,152 9 0.46%
Broadmoor Properties LLC 20,409 10 0.43%15,382 6 0.50%
Bybee Foods LLC 25,240 3 0.80%
Reser's Fine Foods, Inc 15,130 7 0.50%
Conagra Foods Lamb-Weston, Inc.12,268 10 0.40%
Wal-Mart, Inc 13,745 9 0.40%
BNSF Railway Co.14,513 8 0.50%
289,085$ 6.01%195,929$ 6.30%
Source: Franklin County Assessor's Office
2010
Principal Property Taxpayers
Current Year and Nine Years Prior
(amounts expressed in thousands)
Fiscal Year Ended December 31
2018
Taxpayer Tax Revenue Rank
Percentage of
Total Tax
Revenue Tax Revenue Rank
Percentage of
Total Tax
Revenue
Company A $4,184 1 60.11%$3,455 1 48.13%
Company B 703 2 10.10%731 2 10.18%
Company D 683 3 9.81%530 4 7.38%
Company E 419 4 6.02%381 6 5.31%
Company F 343 5 4.93%401 5 5.58%
Company C 301 6 4.32%616 3 8.58%
Company Q 106 7 1.52%
Company O 85 8 1.22%
Company R 70 9 1.01%
Company J 67 10 0.96%184 8 2.56%
Company G 336 7 4.68%
Company P 123 10 1.71%
Company H 150 9 2.09%
Company V 150 9 2.09%
Company Y 123 10 1.71%
-
$6,961 100.00%$7,180 100.00%
Note: Per state privacy laws the names of the companies are confidential and have been indicated instead by letter. The
above information is provided to show concentration risk by company.
Principal B&O Taxpayers
Current Year and Six Years Prior
Fiscal Year Ended December 31
(amounts expressed in thousands)
20112018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
135
2009 2018
Sales % of Sales % of
Tax Total Tax Total
Industries Paid Rank Sales Tax Paid Rank Sales Tax
Motor Vehicle and Parts Dealers 938,165$ 1 14.19%3,605,257$ 1 22.75%
Food Services, Drinking Places 391,852 5 5.92%862,190 2 5.44%
Merchant Wholesale, Durable Goods 637,759 2 9.64%836,822 3 5.28%
Specialty Trade Contractors 379,908 6 5.75%787,884 4 4.97%
Construction of Buildings 509,346 3 7.70%723,593 5 4.57%
General Merchandise Stores 471,742 4 7.13%657,841 6 4.15%
Building Material and Garden 296,321 9 4.48%546,668 7 3.45%
Miscellaneous Store Retailers 340,609 7 5.15%454,200 8 2.87%
Rental and Leasing Services 242,004 10 3.66%339,422 9 2.14%
Repair and Maintenance 322,954 8 4.88%277,253 10 1.75%
Other 2,083,078 31.50%6,759,138 42.63%
Total 6,613,738$ 100.00%15,850,268$ 100.00%
Source: Washington State Department of Revenue
Top Ten Industries that Generate Sales Tax
Current Year and ten Years Prior
Fiscal Year Ended December 31
Fiscal Year Ended
December 31
Total tax
levy for
fiscal year Amount
Percentage
of levy
Collections in
Subsequent
years 1 Amount
Percentage
of levy
2009 5,738$ 5,579$ 97.2%160 5,739$ 100.0%
2010 6,400 6,211 97.0%138 6,349 99.2%
2011 6,638 6,480 97.6%141 6,621 99.7%
2012 6,850 6,693 97.7%154 6,847 100.0%
2013 7,011 6,833 97.5%163 6,996 99.8%
2014 7,064 6,933 98.1%75 7,008 99.2%
2015 7,287 7,169 98.4%92 7,261 99.6%
2016 7,748 7,627 98.4%91 7,718 99.6%
2017 7,949 7,942 99.9%64 8,006 100.7%
2018 8,381$ 8,288$ 98.9%0 8,288$ 98.9%
Source: Franklin County Treasurer's Office Tax Rolls
1 County provides four prior years and combines five years or more together.
Total collections to date
Collected within the fiscal
year of the levy
Property Tax Levies and Collections
Last Ten Fiscal Years
(amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
136
Fiscal Year
Ended
December
31
General
Obligation
Bonds
Special
Assessments
External
Loans &
Notes
Water/
Sewer
Bonds
Other
Loans
Payable1
Total
Primary
Government
Percentage
of Per Capita
Income2
Per
Capita 3
2009 9,945$ 120$ 2,093$ 16,549$ 23,487$ 52,194$ 3.6%958
2010 8,940 785 1,824 29,125 13,950 54,624 3.4%970
2011 7,670 785 1,543 26,240 12,531 48,769 2.8%799
2012 4,710 395 1,258 24,260 11,067 41,690 2.2%665
2013 3,835 227 995 30,355 9,556 44,968 2.2%685
2014 3,315 208 748 28,030 7,997 40,298 1.9%595
2015 11,580 160 593 36,690 6,389 55,412 2.7%812
2016 10,430 45 12 38,438 508 49,433 2.3%701
2017 9,660 20 - 44,785 6,300 60,765 4.4%848
2018 8,865$ -$ -$ 41,898$ 6,532$ 57,295$ 1.4%785
Resources:
1 Other Loans Payble include a new Public Works Trust Fund Loan -Secure Access Washington
2Per Capita Income provided by AWC Open Portal City Snapshot
3 Washington State Office of Financial Management, April 1 Population by City
Note: Details regarding the City's outstanding debt can be found in Schedule 9 and the Debt and Liability Notes in the notes to the financial
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(amounts expressed in thousands, except per capita amount)
Governmental Activities Business-type Activities
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
137
Fiscal Year
Ended
December
31
General
Obligation
bonds
Less: Amounts
available in
debt service
fund1 Total
Percentage of
estimated
actual taxable
value of
property2
Per
capita
2009 9,945$ 1,231$ 8,714$ 0.2969%160
2010 8,940 1,322 7,618 0.2625%135
2011 7,670 1,487 6,183 0.2055%101
2012 4,710 1,494 3,216 0.0999%51
2013 3,835 1,325 2,510 0.0754%38
2014 3,315 1,420 1,895 0.0544%28
2015 11,580 1,459 10,121 0.3039%148
2016 10,430 - 10,430 0.2996%148
2017 9,660 - 9,660 0.2588%135
2018 8,865$ -$ 8,865$ 0.2379%121
Note: Details regarding the City's outstanding debt can be found in the notes and schedules
to the financial statements.
1 Outstanding General Obligation bonds are paid by the General Fund.
2 See schedule of assessed value taxable property for property tax values.
Ratios of General Bonded Debt Outstanding
and Bonded per Capita
Last Ten Fiscal Years
(amounts expressed in thousands, except per capita amount)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
138
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Debt limit 73,370$ 72,923$ 75,213$ 80,378$ 88,541$ 88,576$ 91,985$ 98,436$ 105,699$ 120,022$
Total net debt applicable to limit 12,501 11,954 11,670 4,966 4,053 4,063 12,174 10,442 9,660 8,865
Legal debt margin 60,869$ 60,969$ 63,543$ 75,412$ 84,488$ 84,513$ 79,811$ 87,994$ 96,039$ 111,157$
Total net debt applicable to the
limit as a percentage of debt limit 17.04%16.39%15.52%6.18%4.58%4.59%13.23%10.61%9.14%7.39%
Legal debt margin calculation for fiscal year 2018
Assesed Valuation for 2017 Collections 3,679,413$
Non-Voted Debt Capacity Value (1.5% of Assessed Value)55,191
Less:
Non-Voted GO Bonds Outstanding (11,180)
Other Non-voted General Obligations Outstanding (594)
(11,774)
Remaining capacity without a vote 43,417
Voted and Non-Voted Debt Capacity: (2.5% of Assessed Value)91,985
Less:
Voted GO Bonds Outstanding (400)
Non-Voted GO Bonds Outstanding (11,180)
Other Non-voted General Obligations Outstanding (594)
(12,174)128,887$
-
-
Note: The total indebtedness for general purposes with or without a vote cannot exceed 2.5% of the value of taxable property. The general purposes indebtedness includes debt for
capital leases without a vote. The legal limit for capital leases debt (RCW 35.42.200) is included in the 2.5 percent and does not constitute extra allowable debt.
The 1.5 percent is the maxium limit for gerneral purposes without a vote (councilmanic debt). A council may choose to allocate any portion of this debt capacity to the "voted"
category. If done so, this 1.5 percent of the indebtedness available without vote is to be proportionately reduced by the excess "voted" debt over 1 percent.
80,878
120,022
8,865
72,013
8,865
4,800,880$
Legal Debt Margin
Last Ten Fiscal Years
(amounts expressed in thousands)
Fiscal Year Ended December 31
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
139
Direct debt Amount
Voted General Obligation -$
Councilmanic General Obligation Debt 8,865
Total direct debt 8,865
Overlapping Debt
Jurisdiction Outstanding debt Percent applicable
Estimated Share of
Overlapping Debt
Franklin County 26,804 49.53%13,276
Pasco School District 218,401 60.81%132,810
Port of Pasco 28,442 49.95%14,207
Total overlapping debt 160,293
Total direct & overlapping debt 169,158
Governmental activities debt ratios
Assessed valuation- 2017 (established in November, 2016 for the 2017 tax year)4,227,978
Population 71
Net direct debt to assessed valuation 0.21%
Net direct debt and overlapping debt to assessed valuation 4.00%
Assessed valuation per capita 59,549
Net direct debt per capita 125
Direct debt and overlapping debt per capita 2,383
Councilmanic debt and other obligations:
G.O. Bonds Outstanding 8,865
Other Non-voted G.O. Outstanding -
8,865
Voted GO debt:
G.O. Bonds Outstanding -
-$
(1) Outstanding debt represents total general obligation debt.
(2) Applicable percentage is determined by ratio of assessed valuation of property subject to taxation
in the overlapping unit to valuation of property subject to taxation in the reporting unit.
Sources:
Franklin County Assessor's Office
Franklin County Assessor's website- tax booklet
Direct and Overlapping Governmental Activities Debt
As of December 31, 2018
(amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
140
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Operating Revenues
Water Sales (1)5,515,937$ 5,596,298$ 6,797,470$ 6,989,958$ 7,087,462$ 7,594,091$ 7,971,096$ 8,293,323$ 9,626,536$ 9,484,910$
Irrigation Sales (1)717,653 753,251 874,036 917,076 954,204 1,105,076 1,188,855 1,180,488 1,458,565 1,388,616
Sewer Sales (1)6,265,581 5,788,397 5,614,564 5,705,414 5,813,572 5,914,671 6,197,706 7,030,704 8,732,726 8,443,301
Stormwater Sales (1)462,205 401,279 867,801 883,305 972,375 1,054,682 1,305,138 1,386,325 1,575,163 1,705,779
Process Water Reuse Sales (1)1,720,517 1,723,291 1,492,743 1,942,683 1,453,597 1,997,655 2,053,639 3,063,034 3,596,826 3,550,100
Other Utility Charges (2)2,320,023 3,871,057 1,907,123 1,711,031 1,935,286 2,347,236 2,072,899 2,541,924 2,521,081 1,158,979
Total Operating Revenues 17,001,916 18,133,573 17,553,737 18,149,467 18,216,496 20,013,411 20,789,333 23,495,798 27,510,897 25,731,685
Operating & Maintenance Expenses
Salaries & Wages 2,662,207 2,518,691 2,535,882 2,461,588 2,599,431 2,830,832 3,016,535 3,097,784 3,461,414 3,336,849
Personnel Benefits (3)478,162 892,651 913,062 952,672 1,114,349 1,330,549 1,403,036 2,255,786 1,636,421 904,627
Supplies 479,289 854,667 1,092,728 855,626 1,121,916 1,492,845 1,633,374 1,556,387 1,839,792 1,991,868
Services (1)4,448,568 4,477,102 5,193,430 5,293,094 5,749,161 5,890,538 7,010,663 7,445,805 9,899,511 8,179,595
Total Operating Expenses 8,068,226 8,743,111 9,735,102 9,562,980 10,584,857 11,544,764 13,063,608 14,355,762 16,837,138 14,412,939
Operating Income 8,933,690 9,390,462 7,818,635 8,586,487 7,631,639 8,468,647 7,725,725 9,140,036 10,673,759 11,318,746
Non-Operating Revenue
Interest Income 359,244 228,784 116,848 39,607 41,009 15,685 28,310 48,536 94,215 376,231
Misc Income - - - - - - - - - 291,332
Net Farmland Rental (4)698,974 375,599 498,413 - - - - - - -
Total Non-Operating Revenues (5)1,058,218 604,383 615,261 39,607 41,009 15,685 28,310 48,536 94,215 667,563
Net Revenues before Assessments 9,991,908 9,994,845 8,433,896 8,626,094 7,672,648 8,484,332 7,754,035 9,188,572 10,767,974 11,986,309
Special Assessment Repayments 42,005 387,867 283,861 225,506 257,366 123,404 94,284 52,673 99,775 36,689
Net Revenue for Debt Service Payment 10,033,913 10,382,712 8,717,757 8,851,600 7,930,014 8,607,736 7,848,319 9,241,245 10,867,749 12,022,998
Bond Debt Service (6)2,509,722 2,599,302 3,064,870 3,105,433 2,975,754 3,550,920 5,148,019 3,172,262 3,790,442 3,406,379
Debt Service Coverage (7)4.00 3.99 2.84 2.85 2.66 2.42 1.52 2.91 2.87 3.53
Balance Available for Other Purposes 7,524,191$ 7,783,410$ 5,652,887$ 5,746,167$ 4,954,260$ 5,056,816$ 2,700,300$ 6,068,983$ 7,077,307$ 8,616,619$
Notes:
(1) Excludes revenue raised and used to pay interfund city taxes.
(2) Includes one time fees such as new connection, new meter, capital facility, penalties, operating grants, etc. Beginning in 2018, the capital facility revenues are excluded from this calculation.
(3) In 2018, the pension accrual entry resulted in a negative expense making the personnel benefits total lower than reported in the past.
(4) Farm assets sold in 2011
(5) Excludes noncash capital contributions, gains/losses, capital grants, etc.
(6) Excludes debt for prepaid maturities.
(7) Bond convenant requires coverage ratio of 1.25 times Maximum Annual Debt Service
Waterworks Utility Debt Service Coverage
(Per Bond Official Statement Difinitions)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
141
Pasco
Fiscal Year
Ended
December 31 Population 1 Population 1
Kennewick-
Richand MSA
Unemployment
rate 1, 4 Population 1
Per capita
personal
income 1
Total Personal
Income3 (in
thousands)
Median
household
income 1
Median
household
age 6
School
enrollment 1
2009 57,579 172,169 7.26%75,111 26,342 1,978,574 43,754 27.40 14,437 2
2010 59,781 181,756 7.79%78,163 Not Available Not Available 53,355 Not Available 15,427 2
2011 61,000 184,755 7.92%80,500 Not Available Not Available 53,644 28.53 16,143 2
2012 62,670 187,720 8.73%82,500 30,169 2,488,943 56,221 Not Available 15,994 2
2013 65,600 193,160 9.10%84,800 30,534 2,589,283 57,196 29.14 16,612 2
2014 67,770 197,560 7.70%86,600 Not Available Not Available 58,538 29.71 17,016 2
2015 68,240 199,610 6.80%87,150 33,955 6 Not Available 57,664 29.10 17,353 2
2016 70,560 203,090 6.90%88,670 32,999 6 Not Available 58,854 29.30 17,780 2
2017 71,680 206,110 5.70%90,330 Not Available Not Available 57,535 Not Available 19,932 5
2018 73,013 210,760 6.50%92,540 Not Available Not Available 68,179 Not Available 20,617 5
Fiscal Year
Ended
December 31
Average wage
per job 1 , 3
Unemployment
rate 1, 4 Population 1
Per capita
personal
income 1 , 3
Total Personal
Income3 (in
thousands)
Median
household
income 1, 3
School
enrollment
K-12 1
2009 47,993 9.30%6,672,159 42,112 280,977,960 55,458 1,032,678
2010 49,337 9.90%6,724,540 42,521 285,934,165 54,888 1,037,219
2011 51,139 9.20%6,767,900 44,420 300,630,118 55,500 1,037,676
2012 52,945 8.20%6,817,770 46,045 313,924,220 56,444 1,040,631
2013 53,334 7.00%6,882,400 48,353 332,784,687 57,554 1,047,353
2014 55,427 6.10%6,968,170 49,583 345,502,773 58,686 1,057,388
2015 57,057 5.70%7,061,410 51,146 361,162,876 62,108 1,067,998
2016 58,977 5.40%7,183,700 53,493 397,770,000 65,500 1,080,027
2017 53,470 4.40%7,310,300 56,283 Not Available 68,550 1,104,039
2018 54,689 4.5%7,427,570 Not Available Not Available 73,294$ 1,138,071
SOURCES:
1 State of Washington Office of Financial Management
2 Pasco School District (October Enrollment). Office of Financial management October Headcount Enrollment
3 2016 and 2017 Data is inflation adjusted to 2017 Dollars per State of Washington Office of Financial Management
4 Unemployment Data from the U. S. Bureau of Labor Statistics
5 2017 K12.wa.us/DataAdmin/enrollment
6 United States Census Bureau / Fact Finder.census.gov
Demographic and Economic Statistics
Last Ten Fiscal Years
Tri Cities Franklin County
State
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
142
Employer Employees Industry Rank Employees Industry Rank
Battelle/PNNL Research and Development 4,500 Research & Development 1
Kadlec Medical Center 2,175 Health Services 5 3,734 Health Services 2
ConAgra (Lamb Weston)3,057 Agriculture Products 3 3,400 Food processing 3
Bechtel National 2,850 Government 4 2,943 Government 4
Kennewick School District Education 2,514 Education 5
Washington River Protection 1,686 Government 6 2,325 Government 6
Pasco School District Education 2,200 Education 7
Mission Support Alliance 1,478 Government 7 1,918 Government 8
CH2M Hill 3,260 Government 2 1,800 Government 9
Richland School District Education 1,800 Education 10
URS 3,500 Government 1
Washington Closure Hanford 1,370 Government 8 Government
Tyson Foods 1,300 Agriculture Products 9 1,400 Agriculture Products
Energy Northwest 1,222 Research and Development 10 1,100 Research and Development
Source: TRIDEC
Employer Employees Industry Rank Employees Industry Rank
Lamb Weston 3,000 Food processor 1
Pasco School District 2,065 K-12 1 2,200 Education 2
Lourdes Health Network 807 Health Care 2 921 Health Care 3
Columbia Basin College 766 Community College 3 766 Community College 4
Coyote Ridge Correction Facility 680 Correction Facility 5
Douglas Fruit 210 Fruit packaging 8 621 Fruit packaging 6
Pasco Processing 350 Food processor-vegetables 5 500 Food processor-vegetables 7
Walmart 180 Call Center 10 356 Retail 8
City of Pasco 305 City services 6 355 City Services 9
Tri-City Community Health 230 Food processor-potatoes 7 330 Health Care 10
Boise Cascade 574 Manufacturing 4
Franklin County 190 County Services 9
Resers
Source: TRIDEC
*The Tri-Cities are three closely tied cities which include Pasco, Kennewick and Richland. Each city borders one-another, making the Tri-
Cities seem like one uninterrupted mid-sized city. Due to this, many employers overlap among the three cities.
*Pasco is the county seat of Franklin County and the largest city within the county, making up approximately 70 percent of the county's
population. Many employers have locations in Pasco and throughout the county.
Principal Employers
Current Year & 6 Years Ago
Year Ended December 31
Tri Cities*
2012 2018
Franklin County*
2012 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
143
Employment Sector 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Goods Producing 13,200$ 13,300$ 13,600$ 13,400$ 13,600$ 1,400$ 14,600$ 14,900$ 16,600$ 17,300$
Natural resources & construction 6,300 6,200 6,500 6,000 6,200 6,300 6,700 7,200 8,600 9,500
Manufacturing 6,900 7,100 7,100 7,400 7,400 7,700 7,900 7,700 8,000 7,800
Service providing 83,900 88,600 90,300 87,900 88,100 89,700 92,700 96,200 99,700 99,100
Private services providing 66,500 70,700 72,200 69,800 69,800 71,100 73,700 76,100 76,000 78,900
Trade, transportation, warehousing & utilities 16,200 16,600 16,700 17,100 17,500 18,100 19,100 20,100 25,800 20,100
Retail trade 11,300 11,400 11,500 11,700 11,800 12,100 12,700 13,900 13,200 13,700
Financial activities 3,400 3,600 3,700 3,900 4,200 3,900 4,000 3,900 3,900 4,200
Professional & business services 21,700 24,500 24,900 21,800 20,800 20,700 21,200 21,200 21,400 21,400
Information 1,000 900 900 900 900 900 900 800 800 700
Administrative & support services 10,200 12,000 12,200 10,600 10,500 10,400 10,800 11,700 11,200 11,900
Education & health services 12,300 13,000 13,300 13,400 13,700 14,400 14,800 15,400 15,500 17,000
Leisure and hospitality 8,800 9,000 9,400 9,500 9,600 9,900 10,400 11,200 11,300 11,800
Food services 6,300 6,500 6,800 6,900 7,000 7,300 7,600 8,400 8,500 8,900
Government 17,400 18,000 18,100 18,200 18,300 18,600 19,000 20,100 20,100 20,200
Federal & State government 4,000 4,200 4,200 4,200 4,300 4,300 4,300 4,400 4,400 1,200
Local government 13,400 13,700 13,900 13,900 14,100 14,300 14,700 15,700 15,700 16,100
Total Non-Agriculture 97,100 101,900 103,900 101,300 101,700 103,700 107,300 111,100 112,700 116,400
Total Private 79,700$ 84,000$ 85,900$ 83,100$ 83,400$ 85,100$ 88,300$ 91,000$ 92,600$ 96,200$
Non-Agriculture Wage and Salary Workers
Employed in Kennewick-Richland-Pasco MSA (rounded to hundreds) (1)
Last Ten Fiscal Years
(1) Detail may not add to indicated total due to rounding. Excludes proprietors, agriculture, self-employed, unpaid family, domestic workers and military. Includes all full and part-time
wage and salary workers receiving pay during the period including the 12th of the month by place of work. Information for 2008 is from Washington State Employment Security
Department (using BLS data). All subsequent data (2009 and forward) is directly from the U. S. Bureau of Labor Statistics (BLS) and not seasonally adjusted.
Fiscal Year
Ended
December 31
New
Single
Family
Permits
New
Single
Family
Value
Total
Permits Total Value Permits Value Permits Value Permits Value
2009 476 96,228$ 1,499 102,110$ 261 43,189$ 90 16,799$ 1,850 162,098$
2010 544 111,392 1,908 119,197 234 31,251 45 7,324 2,187 157,772
2011 492 105,577 1,817 113,320 289 16,591 28 3,519 2,134 133,430
2012 338 72,768 1,507 85,314 328 30,317 54 26,360 1,889 141,991
2013 220 50,396 1,705 73,701 364 44,173 44 6,862 2,113 124,736
2014 223 53,923 1,517 67,408 297 58,575 74 37,832 1,888 163,815
2015 248 62,949 1,724 83,033 317 48,618 98 36,291 2,139 167,942
2016 389 94,956 387 110,833 368 53,880 111 90,563 866 255,276
2017 474 119,754 2,618 134,519 421 56,276 80 10,034 3,119 200,829
2018 489 128,271$ 2,690 143,335$ 425 47,140$ 73 29,588$ 3,188 220,063$
SOURCE:
1 City of Pasco website Building Permit History.
2 Includes single family and mobile home
TotalCommercialResidental 2 Industrial
Building Permits
Last Ten Fiscal Years
($ amounts expressed in thousands)
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
144
Function 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
General government 52 46 45 45 45 49 50 52 54 53
Public safety
Muni Court 14 15 16 16 16 15 15 15 15 15
Police
Officers 69 67 67 67 71 71 71 77 77 81
Civilians 11 11 12 12 12 12 12 10 10 10
Fire
Firefighters and officers 34 34 33 33 35 35 39 35 36 39
Ambulance 15 16 18 19 19 19 19 28 36 40
Physical enviroment
Utilities
Water 22 22 22 21 20 20 22 24 22 22
Sewer 18 18 18 17 18 19 21 20 20 19
Water process reuse 3 3 2 2 3 2 2 3 7 7
Storm water 4 4 5 5 4 5 6 6 8 8
Irrigation 2 2 2 2 2 4 4 5 3 3
Transportation
Highways and streets
Engineering 13 13 13 14 16 17 17 17 17 17
Maintenance 7 7 7 7 6 7 8 10 10 10
Health and human services 2 2 2 3 3 3 3 3 3 3
Economic enviroment 17 15 15 15 15 16 16 16 16 16
Culture and recreation 16 16 16 16 16 16 17 20 20 19
Total 299 291 293 294 301 310 322 341 354 362
Source: Annual Operating Budget
Full-Time Equivalent City Government Employees by Function
Last Ten Fiscal Years
Fiscal Year Ended December 31
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
145
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Function
Public Safety
Police
Violent crime 217 183 202 178 151 183 156 146 143 166
Nonviolent crime 1,525 1,475 1,609 1,711 1,628 1,516 1,482 1,689 1,432 1,280
Calls for service 55,672 52,116 49,819 52,027 54,996 52,067 49,575 55,407 57,250 66,815
Victims per 1000 population 32 29 30 30 27 40 25 38 20 19
Fire & Emergency Medical Service
Number of emergency response-FIRE 238 215 277 260 279 241 281 243 289 313
% of total incidents-FIRE*10%7%6%6%5%6%5%5%5%
Number of emergency response-EMS 3,005 3,016 3,337 3,474 3,394 3,731 4,011 3,960 4,105 4,192
% of total incidents-EMS*90%79%79%79%79%79%77%75%74%
Number of emergency response-OTHER*614 662 658 730 805 914 1,116 1,186
% of total incidents- OTHER*15%15%15%16%16%18%20%21%
Community Development
Number of new Single Family units 467 530 483 314 204 219 243 387 468 756
Number of new Muli Family units 0 8 1 16 0 8 0 0 1 0
Number of new Manufactured units 9 14 9 21 16 4 5 2 6 4
Commercial permits 351 279 317 382 408 341 415 479 501 498
Construction value (millions)60.0 38.6 20.1 56.7 51.0 96.4 84.9 144.4 66.3 47.3
Residential permits 1,499 1,908 1,817 1,507 1,705 1,517 1,724 1,941 2,115 2,188
Construction value (millions)102.1 119.2 113.3 85.3 73.7 67.4 83.0 110.8 134.5 143.3
Physical environment
Highway and streets
Street resurfacing (miles)*4.6 3.50 3.57 9.63 0.00 0.00 0.00
Utilities
Water
Bills processed 194,614 202,136 207,685 217,911 226,934 227,682 233,858 239,670 242,916 248,347
New connections 631 666 571 449 328 340 438 568 672 589
Water meters replaced 73 1,842 1,900 2,640 1,431 1,471 1,499 1,117 187 146
Source: Various City of Pasco departments.
Fiscal year
Operating Indicators by Function
Last Ten fiscal years
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
146
Amounts Amounts
No. of Permits in Thousands in Millions
Commercial 425 47,140$
Less Multi-Family - -
Industrial 73 29,588
498 76,728 77$
Mobile Home 4 111
Plus Commercial Multi Family - -
Residential 2,184 143,223
2,188 143,334 143
Total 2,686 220,062 220
Single Family:
SFDU 485 128,159
Mobile Home 4 111
489 128,270$ 128$
Building Permits
City of Pasco
Year ended December 31, 2018
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
147
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Function
Public Safety
Police Stations 1 1 1 1 1 1 1 1 1 1
Police Sub-Stations 4 4 4 4 4 4 4 4 4 4
Patrol units 43 43 50 52 53 58 39 54 61 64
Fire stations 3 3 3 3 3 3 3 3 3 3
Culture and recreation
Parks *27 27 27 27 21 24 28 28
Parks acreage *274 280 280 320 323 329 375 28
Swimming pools 3 3 3 3 3 2 2 2 2 2
Physical environment
Streets
Street (miles)475 619 781 821 823 839 843 669 675 665
Street lights 3,222 3,290 3,374 3,449 3,469 3,476 3,532 3,413 3,505 4,369
Traffic signals *49 50 50 50 50 50 51 51
Water
Water mains (miles)302 306 309 313 314 315 323 310 323 360
Services (accumulated total)15,748 16,081 16,305 16,660 16,754 16,783 17,206 17,248 20,079 21,708
Fire hydrants 1,997 2,036 2,069 2,106 2,114 2,138 2,214 2,190 2,724 2,836
Maximum daily capacity
Million Gallons per Day (MGD)29 33 33 30 30 30 32 33 33 33
Sewer
Sanitary sewer (miles)219.8 224 226 264 265 266 269 269.89 275.06 256
Maximum daily treatment
capacity (MGD) 7.1 7.1 7.1 7.1 7.1 7.1 6.5 6.5 6.5 6.5
Average daily treatment (MGD) *3.6 3.9 4.0 4.1 4.3 4.5 5.0 5.2 5.4 5.4
Water Process Reuse
Irrigated acres 1,848 1,848 1,848 1,848 1,848 1,848 1,848 1,832 1,856 1,856
Total Acres 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200
Storm Water
Storm sewer (miles)40 42 43 45 46 47 48 49 51 88
Number of catch basins 2,878 3,089 3,176 3,289 3,322 3,336 3,451 3,508 3,705 5,163
Irrigation
Maximum daily capacity (thousand of
gallons) 17,100 17,100 17,100 17,100 17,100 20,760 20,760 20,760 32,760 21,013
Sources: Various government departments.
Fiscal Year Ended December 31
Capital Used by Function
Last Ten Fiscal Years
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
148
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Water System Accounts by Class
Single Family Residential 14,344 14,670 15,204 15,612 15,792 15,969 16,355 16,687 17,634 18,078
Multi-Family Residential 507 453 463 468 470 482 496 505 544 538
Commercial 1,112 1,272 1,296 1,321 1,421 1,372 1,430 1,443 1,456 1,461
Other 426 402 4,047 422 452 455 476 486 466 666
Total 16,389 16,797 21,010 17,823 18,135 18,278 18,757 19,121 20,100 20,743
Sewer System Accounts by Class
Single Family Residential 12,148 12,841 13,373 13,746 13,949 14,133 14,450 14,904 15,481 15,917
Multi-Family Residential 482 442 449 454 470 497 512 527 526 558
Commercial 1,017 935 949 969 987 1,004 1,125 1,128 1,206 1,256
Total 13,647 14,218 14,771 15,169 15,406 15,634 16,087 16,559 17,213 17,731
Stormwater System Customer Accounts 15,129 15,778 16,329 16,718 17,580 17,781 18,585 18,585 19,445 19,697
Irrigation System Customer Accounts 4,284 4,783 5,176 5,435 5,668 6,604 6,863 6,863 7,495 7,956
Process Water Reuse Facility Customers
Pasco Processing 43%38%50%46%46%41%42%44%47%41%
Twin City Foods 19%32%16%21%19%22%23%26%29%19%
CRF Frozen Foods-Bybee Food 18%16%17%15%21%19%19%15%1%17%
Reser's Fine Food 20%14%17%18%14%18%16%15%23%23%
100%100%100%100%100%100%100%100%100%100%
Source: City of Pasco billing systems.
Waterworks Utility Customer Accounts
Last Ten Fiscal Years
For the Month of August
Percent of Total Annual Billed Revenue
City of Pasco, Washington 2018 Comprehensive Annual Financial Report
149
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Water rates and monthly charges
Inside city rates listed; outside city 90% surcharge
Consumption per 100 cu feet 0.54$ 0.65$ 0.65$ 0.65$ 0.68$ 0.68$ 0.70$ 0.74$ 0.77$ 0.81$
Single family residential monthly base (in city)
Size of Service
3/4 inch 10.50 12.50 12.50 12.50 12.50 16.25 16.25 17.06 17.92 18.81
1 inch 15.75 18.74 18.74 18.74 18.74 24.35 24.35 25.57 26.85 28.19
Multi-family and commercial monthly base
Size of Service
3/4 inch 14.80 17.61 17.61 17.61 17.61 22.90 22.90 24.05 25.25 26.51
1 inch 21.37 25.43 25.43 25.43 25.43 33.05 33.05 35.18 36.93 38.78
1 1/2 inch 41.69 49.61 49.61 49.61 49.61 64.50 64.50 67.73 71.11 74.67
2 inch 66.88 79.59 79.59 79.59 79.59 103.45 103.45 108.62 114.05 119.76
3 inch 91.34 108.69 108.69 108.69 108.69 141.30 141.30 148.37 155.78 163.57
4 inch 131.60 156.60 156.60 156.60 156.60 203.60 203.60 213.78 224.47 235.69
6 inch 205.43 244.46 244.46 244.46 244.46 317.80 317.80 333.69 350.37 367.89
8 inch 284.68 338.77 338.77 338.77 338.77 440.40 440.40 462.42 485.54 509.82
Irrigation monthly charge
Base per residential unit 24.00 24.00 26.00 26.00 26.00 26.00 26.00 26.00 27.30 28.12
Per Irrigation unit 7.50 7.50 8.12 8.12 8.12 8.12 8.12 8.12 8.53 8.79
Per Irrigated acre 70.00 70.00 75.81 75.81 75.81 75.81 75.81 75.81 79.60 81.99
Sewer rates and monthly charges
Inside city rates listed; outside city 50% surcharge
Residential monthly base <= 4 units 27.53 27.53 24.80 24.80 24.80 24.80 24.80 27.22 29.67 31.45
Residential monthly base > 4 units 22.05 22.05 20.00 20.00 20.00 20.00 20.00 21.95 23.93 25.36
No residential consumption charge 8.30
Commercial base rate 36.79 36.79 33.35 33.35 33.35 33.35 33.35 36.60 39.90 42.29
Consumption per 100 cu ft over 1000 cu ft 1.29 1.29 1.29 1.29 1.29 5.25 1.29 1.42 1.54 1.64
Stormwater monthly charge
Residential
Single family residential 1.80 1.80 3.00 3.90 3.90 4.40 4.90 4.90 4.90 5.64
Apartments (per unit)1.80 1.80 3.00 1.95 1.95 2.20 2.45 2.45 2.45 2.82
Multi-family residential (per unit)0.90 0.90 1.50 1.95 1.95 2.20 2.45 2.45 2.45 2.82
Undeveloped parcels - - - - - - - -
Vacant buildings 1.80 1.80 3.00 3.90 3.90 4.40 4.90 4.90 4.90 5.64
Industrial/Commercial
Parking for 0-5 vehicles 1.80 1.80 3.00 3.90 3.90 4.40 4.90 4.90 4.90 5.64
Parking for 6-10 vehicles 3.60 3.60 6.00 7.80 7.80 8.80 9.80 9.80 9.80 11.27
Parking for 11-15 vehicles 5.40 5.40 9.00 15.60 15.60 13.20 14.70 14.70 14.70 22.54
Parking for 16 plus vehicles 7.20 7.20 12.00 19.50 19.50 17.60 19.60 19.60 19.60 28.18
Additional charges
Property runoff to City systems ($1.25 min) - acre40.00 40.00 66.70 86.71 86.71 86.71 86.71 86.71 86.71 111.16
State Highway right-of-way - acre 10.00$ 10.00$ 16.68$ 21.71$ 21.71$ 21.71$ 21.71$ 21.71$ 21.71$ 26.97$
Source: City of Pasco Municipal Code Title 3
Waterworks Selected Utility Rates
Last Ten Fiscal Years
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150
SACAJAWEA HISTORICAL STATE PARK
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STATE REQUIRED SCHEDULES
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Schedule 9 -Schedule of Liabilities
For the Year Ended December 31, 2018
Beginning Ending
ID No.Debt Type Description Due Date Balance Additions Reductions Balance
GENERAL OBLIGATIONS
251.11 Councilmanic 2011 LTGO Refund 2001 LTGO 12/1/2020 1,480,000 - 475,000 1,005,000
251.11 Councilmanic 2015 LTGO Police Station 12/1/2035 8,180,000 - 320,000 7,860,000
TOTAL GENERAL OBLIGATIONS 9,660,000 - 795,000 8,865,000
REVENUE OBLIGATIONS
252.11 Revenue Bond 2009 Revenue Water Sewer Bond1 11/1/2029 6,485,000 - 475,000 6,010,000
252.11 Revenue Bond 2010A Water/Sewer Bond 6/1/2029 4,480,000 - 295,000 4,185,000
252.11 Revenue Bond 2010T Refund 98 -Reuse Facility 6/1/2018 180,000 - 180,000 -
252.11 Revenue Bond 2013A Sewer Bond 12/1/2028 2,120,000 - 100,000 2,020,000
252.11 Revenue Bond 2013T Reuse Facility Bond 12/1/2028 5,925,000 - 445,000 5,480,000
252.11 Revenue Bond 2015 Water/Sewer Revenue Refunding 12/1/2040 13,910,000 - 265,000 13,645,000
252.11 Councilmanic Cashmere Valley Bank Sewer SRF Refunding4 7/31/2019 2,270,585 - 1,127,599 1,142,986
252.11 Revenue Bond 2017 Water/Sewer Improvement Revenue 2 12/1/2042 9,415,000 - - 9,415,000
263.82 PWTF Loan Riverview Trunk/SE Sewer PW00-043 7/1/2020 333,422 - 111,140 222,282
263.88 DWSRF Loan Columbia Water supply DM15-952-0373 10/1/2034 5,966,918 737,344 354,703 6,349,559
263.86 Revenue Bond HAEIFAC - Reuse Facility Improvement Loan 7/1/2028 - 1,500,000 68,534 1,431,466
259.12 Accrued Leave Compensated Absences 12/31/2018 2,957,984 2,395,039 2,164,528 3,188,495
264.40 OPEB Liability Other Post Employment Benefits 12/31/2018 16,179,101 44,194 44,194 16,223,295
264.30 Pension Liability Pension Liabilities 12/31/2018 9,134,269 - 2,886,287 6,247,982
TOTAL REVENUE OBLIGATIONS 79,357,279 4,676,577 8,516,985 75,561,065
253.11 2010 LID 145 - A Street Improvements 11/15/2020 20,000 - 20,000 -
20,000 - 20,000 -
TOTAL LIABILITIES 89,037,279$ 4,676,577$ 9,331,985$ 84,426,065$
3In 2018 the City reported cash draws from the Columbia Water Supply loan of $63,044.
4Cashmere Valley Bank issued a short term LTGO Bond to pay off a Department of Ecology State Water Pollution Loan from the State Revolving Fund (SRF).
MCAG NO. 0292
2New revenue bonds were issued by the Water/Sewer Utility in 2017 to be used for Sewer infrastructure improvements. This bond requires interest only payments until 2030.
ASSESSMENT OBLIGATIONS
TOTAL ASSESSMENT OBLIGATIONS
Notes to Schedule of Long-Term Liabilities
1In addition to the regular scheduled principal payment for the 2009 Water Sewer Revenue Bonds, $240,000 in callable bonds with maturities of 2022 and 2024 were redeemed in 2017.
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Grantor/Other
Pass-Through Grantor Identification STATE
Program Title Number AWARDS
Washington State Department of Ecology
2017-2019 Biennial Stormwater Capacity Grant 42,148
Washington State Secretery of State
Technology Grant Secretary of State 9,000
Washington State Traffic Safety Commission pass through WASPC
WA GANG DATA BASE PROJECT 6,064
Washington State Office of Public Defence
Public Defense Improvement 4,533
Washington State Department of Transportation
Oregon Ave (SR 397)- Phase 1 182 to Lewis St (or A 4,679,167
Road 84 Safe Walking Route Connection HLP-SR17(007) LA 9214 165,172
Rowena Chess School Crossing HLP-SR17(006) LA 9213 68,068
Lewis Street Overpass STPUS-HLP-3530(006) & LA-7055 477,634
Department of Health & Human Services
Prehospital Participation Grant 1,222
AOC by the Washington State legislature
LFO Funding Distribution E2SHB-1783 13,739
TOTAL STATE AND LOCAL ASSISTANCE:5,466,745
GR9.FR.35.99.FR
MCAG NO. 0292
CITY OF PASCO
SCHEDULE 15- SCHEDULE OF STATE AND LOCAL FINANCIAL ASSISTANCE
For the Year Ended December 31, 2018
WQSWCAP-1719-Pasco-00120
GR0.PL.33.18.TS
GR0.MN.34.18.01
STPUS-0397 (008) LA-7866
G-6041
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From
Grantor/Federal Other Pass-From
Pass-Through Grantor CFDA Identification Through Direct
Program Title Number Number Awards Awards Total Note:
Economic Development Administration, US Department of Commerce-
Pass-Through WA State Department of Commerce
Economic Adjustment Assistance 11.307 07-79-07368 5,735 5,735 2
Office of Community Planning and Development, Department of Housing & Urban Development
Community Development Block Grant/Entitlement Grant 14.218 B-14-MC-53-009- CDBG 119 119 3
Community Development Block Grant/Entitlement Grant 14.218 B-16-MC-53-009- CDBG 206,849 206,849 3
Community Development Block Grant/Entitlement Grant 14.218 B-17-MC-53-009- CDBG 154,329 154,329 3
Community Development Block Grant/Entitlement Grant 14.218 B-18-MC-53-009- CDBG 379,610 379,610 3
Community Development Block Grant/Entitlement Grant cluster - 740,907 740,907
Pass-Through Washington Department of Commerce
Community Development Block Grants/State's program 14.228 08-F6401-014 2,193 2,193 3
Pass-Through City of Richland
Home Investment Partnerships Program 14.239 Home Program 74,507 74,507 3
Pass-Through Washington Dept of Archaeology & Historic Preservation
Historic Preservation Fund Grants-In-Aid (A,B)15.904 FY18-61018-007 5,000 5,000 3
Bureau of Justice Assistance
Pass -Through Washington Association of Sherrifs & Police Chiefs
Law Enforcement Assistance National Instant Criminal Background Check System16.309 HB 1501 500 500 2
Bureau of Justice Assistance, Department of Justice
Public Safety Partnership and Community Policing Grant 16.710 2017UMWX0103 1,808 1,808 2
Pass-Through Washington Department of Commerce
Violence Against Women Formula Grant 16.588 F17-31103-023 34,698 34,698 2
Criminal Division, Department of Justice
Body Worn Camera Policy & Implementation 16.835 2018-BC-BX-0010 221 221 2
Pass-Through from US Marshalls
Equitable Sharing Program 16.922 Equitable Sharing 3,759 3,759 4
US Department of Transportation/ Federal Highway Administration
Pass-Through Washington Department of Transportation
Highway Planning and Construction 20.205 STPUS-0397 (008) LA-7866 1,122,133 1,122,133 2
Highway Planning and Construction 20.205 STPUL-3515(008) LA-8322 1,780 1,780 2
Highway Planning and Construction 20.205 HSIP-3551 (004) - LA 8697 23,529 23,529 2
Highway Planning and Construction 20.205 STPUL-9911(010) LA-8321 11,675 11,675 2
Highway Planning and Construction Cluster Total US Dept. of Transportation FHA 1,159,117 - 1,159,117
Pass-Through Washington Association of Sherriff & Police Commission
State and Community Highway Safety 20.600 GR0.PL.33.TS.18 3,715 3,715 2
Pass-Through Washington Traffic Safety Commission
State and Community Highway Safety 20.600 GR0.PL.33.18.DD 1,409 1,409 2
State and Community Highway Safety 20.600 GR0.PL.33.19.CW 416 416 2
State and Community Highway Safety 20.600 GR0.PL.33.18.CT 781 781 2
State and Community Highway Safety 20.600 GR0.PL.33.19.DU 935 935 2
State and Community Highway Safety 20.600 GR0.PL.33.18.DU 710 710 2
Total State and Community Highway Safety 7,966 - 7,966 2
National Priority Safety Programs 20.616 GR0.PL.33.18.FF 1,967 1,967 2
Highway Safety Cluster Total US Dept. of Transportation 9,933 9,933
US Department of Transportation -National Highway Traffic Safety Administration (NHTSA)
Pass-Through Washington Department of Transportation
National Infrastructure Investments 20.933 GRANT12156090 212,312 212,312 2
Total US Dept of Transportation NHTSA 212,312 - 212,312
Administration for Community Living, Department of Health & Human Services
Pass-Through Yakima County, Office of Aging & Long Term Care
Special Programs for the Aging, Title III. Part B, Grans for
Supportive Services and Senior Centers 93.044 ALTCCOG 2018-18 14,973 14,973 2
Aging Cluster Total US Dept of Health & Human Services 14,973 - 14,973
US Department of Homeland Security
Pass-Through FEMA
Assistance to Firefighters Grant 97.044 EMW-201-FR-00553 470,319 470,319 2
Pass-Through Franklin County Emergency Management
Homeland Security Grant Program (A)97.067 E17-078 HSGP (16SHSP)33,990 33,990 2
Staffing for Adeqiate Fire and Emergency Response 97.083 EMW-2016-FH-00428 444,231 444,231 2
Total US Department of Homeland Security 948,541 - 948,541
TOTAL FEDERAL AWARDS EXPENDED:2,474,983$ 742,936$ 3,214,204$
The accompanying notes are an integral part of this schedule.
MCAG NO. 0292
SCHEDULE 16- SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Year Ended December 31, 2018
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NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
NOTE 1 – Basis of Accounting
The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the City’s
financial statements. The City uses a modified accrual basis of accounting for its governmental funds and full
accrual basis of accounting for its proprietary funds.
NOTE 2 – Program costs
The amounts shown as current year expenditures represent only the federal grant portion of the program costs.
Entire program costs, including the City’s portion, are more than shown. Such expenditures are recognized
following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local, and
Indian Tribal Governments, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part
200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards,
wherein certain types of expenditures are not allowable or are limited as to reimbursement.
NOTE 3 – Revolving loan – Program income
The City participates in a Regional Revolving Loan program for economic development which is operated by
Benton Franklin Council of Governments. Under this federal pass-through grant, repayments to the City are
considered program income, and loans of such funds to eligible recipients are considered expenditures.
The City participates in the Neighborhood Stabilization Program for recovering foreclosed properties which
are rehabilitated and sold as low-income housing. Under this federal pass-through grant, the sale of low-income
homes by the City is considered program income, and the cost of rehabilitating homes and purchasing
properties are considered expenditures.
The City also participates in the Housing and Urban Development HOME Program for low -income
individuals, as part of a regional consortium administered through the City of Richland. The City is not privy
to information on what portion of funds received from the City of Richland are derived from program income.
NOTE 4 – Department of Justice Equitable Sharing
The City reports these funds on the Schedule of Expenditures of Federal Awards when program proceeds
received rather than when expenditures incurred due to program stipulations.
NOTE 5 – Indirect cost rate
The city has not elected to use the 10 -percent de minimis indirect cost rate allowed under the Uniform
Guidance.
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MCAG 0292
City of Pasco
Schedule 17 Limitation on public works projects performed by public employees
For the Year Ended December 31, 2018
Total current public work construction budget as amended (annual or 33,586,592
biennial as applicable)
Allowable portion of total public works (10 percent of line 1)3,358,659
Less: Amount (if any) in excess of permitted amount from prior budget
period.-
Total allowable public works (line 2 minus line 3)3,358,659
Total public works projects performed by public emploiyees during the
current year (include work performed by a county)169,369
If this is the second year of a biennial budget, total public works projects
performed by public employees during the first year of biennium -
Restricted under (over) allowable (line 4 minus line 5 minus line 6)3,189,290
NOTE: If the restricted amount is over allowable, this amount must be carried forward
to the next budget period report.
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CITY OF PASCO
SCHEDULE 19 - LABOR RELATIONS CONSULTANTS
For the Year Ended December 31, 2018
Has your government engaged labor relations consultants?X Yes No
If yes, please provide the following information for each consultant(s):
Name of Firm:Name of Firm:
The Wesley Group The Summit Law
Name of Consultant:Name of Consultant:
Kevin Wesley Elizabeth Kennar, consultant
Business Address:Business Address:
P.O. Box 7164 315 Fifth Avenue South Suite 1000
Kennewick, WA 99336-0616 Seattle, WA 98104
Amount Paid To Consultant During Fiscal Year:Amount Paid To Consultant During Fiscal Year:
$0.00 $28,059.00 pd by HR to consultant
Terms And Consitions, As Applicable, Including:Terms And Consitions, As Applicable, Including:
Rates (E.G., Hourly, Etc.):$100 per hour Rates (E.G., Hourly, Etc.):$370.00
Maximum Compensation Allowed:0 Maximum Compensation Allowed:0
Duration Of Services:Various throughout the year.
Services Provided:Union Bargaining Assistance - Wesley
Human Resources Issues - Kennar
Certified Correct this 12th day of March 2019
to the best of my knowledge and belief:
Colleen Chapin
HR Manager
MCAG NO. 0292
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CITY OF PASCO
SCHEDULE 21 - LOCAL GOVERNMENT RISK ASSUMPTION
For the Year Ended December 31, 2018
How do you insure property and liability risks, if at all?
Formal or informatl self-insurance program/activity for some or all perils/risks
Belong to a public entity risk pool
x Purchase private insurance
Retain risk internally without formal or informal self-insurance program/activity
x Self-insure for some or all benefits
Belong to a public entity risk pool
All benefits are provided by a health insurance company or HMO
Not applicable – no such benefits offered
How do you insure unemployment compensation obligations, if any?
x Self-insured ("Reimbursable")
Belong to a public entity risk pool
Pay taxes to Employment Security Department ("Taxable")
Not applicable - no employees
How do you insure workers compensation obligations, if any?
Self-insured ("Reimbursable")
Belong to a public entity risk pool
x Pay premiums to Labor and Industries
Not applicable - no employees
How do you insure other risks or obligations, if any?
Self-insure some or all other risks
x Belong to public entity risk pool
Purchase private insurance
Not applicable - have no other insurable risks
continued on next page
How do you provide health and welfare insurance (ex: medical, dental, prescription drug, and/or
vision benefits) to employees, if at all?
MCAG NO. 0292
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CITY OF PASCO
SCHEDULE 21 - LOCAL GOVERNMENT RISK ASSUMPTION
For the Year Ended December 31, 2018
Third Party AdministratorBenefit Management, Inc.
Contact Kelli Glover
Address:PO Box 1090, Great Bend, KS 67530
Phone:800-290-1368 x2076
Email:kglover@benefitmanagementllc.com
Describe each class of risk the governing body has decided to assume as well as the appropriate
dollar level involved.
Numbers of claims Numbers of claims Total amount of
received during the paid during the claims paid
period period during the period
Medical/Rx 31,257 30,785 $4,749,951.95
Dental 1,757 $2,066.00
Description of Risk Type
MCAG NO. 0292
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OUR THANKS TO AN EXCELLENT TEAM
We recognize the contributions of the following City of Pasco employees for their contribution to this
report. Each member of this team of professionals played a key role in producing this CAFR. Their
dedication and teamwork are essential to the success of this report and all of their efforts are hugely
appreciated.
Richa Sigdel
Finance Director
Griselda Garcia
Accounting Lead
Darcy Buckley
Accounting Lead
Karen Conn
Staff Accountant
Charlene Sandland
Staff Accountant
Rosa Moreno
Staff Accountant