COUNTY OF SANTA BARBARA STATE OF CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2015

COUNTY OF SANTA BARBARA STATE OF CALIFORNIA

COMPREHENSIVE ANNUAL FINANCIAL REPORT

FISCAL YEAR ENDED JUNE 30, 2015

CACHUMA LAKE

2010

ROBERT W. GEIS, CPA, CPFO AUDITOR‐CONTROLLER

2015

January 2010

June 2015

The two pictures of Cachuma Lake on the cover represent very different points of time. In January 2010, just 5 years ago, the water level in the Cachuma Lake Reservoir was at 83% capacity, with snow on the Santa Ynez Mountains. In June 2015, the Cachuma Lake Reservoir is at 26% of capacity with parched mountains in the background. This 57% decrease in water level is due to the multi‐year, emergency‐level drought that is affecting all of California. Voluntary and mandatory conservation efforts have been put in place in Santa Barbara County while the hope for rain is ever present.

Both cover photographs were taken by and shared courtesy of Tom Fayram, Water Resources Deputy Director, Public Works Department, County of Santa Barbara.

COUNTY OF SANTA BARBARA STATE OF CALIFORNIA

COMPREHENSIVE ANNUAL FINANCIAL REPORT

FOR FISCAL YEAR ENDED JUNE 30, 2015

Prepared Under the Supervision of Robert W. Geis, CPA, CPFO Auditor‐Controller

Table of Contents

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Page

INTRODUCTORY SECTION

Letter of Transmittal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

FINANCIAL SECTION

IndependentAuditor’sReport………………………………….. 9

Management’sDiscussionandAnalysis(Unaudited)……………………….. 11

Basic Financial Statements:

Governmentwide Financial Statements:
Statement of Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 StatementofActivities…………………………………. 31

Fund Financial Statements: Governmental Funds:

BalanceSheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . StatementofRevenues,Expenditures,andChangesinFundBalances.

Proprietary Funds: StatementofNetPosition……………………. Statement of Revenues, Expenses, and Changes in Fund Net Position . StatementofCashFlows . . . . . . . . . . . . . . . . . . . . . . . . .

Fiduciary Funds:
StatementofFiduciaryNetPosition . . . . . . . . . . . . . . . . . . . Statement of Changes in Fiduciary Net Position . . . . . . . . . . . . .

NotestotheFinancialStatements…………………..

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110 110 110 110

113 114 115 116 117 118 119 120

124

Required Supplementary Information (Unaudited):
Santa Barbara County Employees’ Retirement System ‐ Schedule of the County’s

Proportionate ShareoftheNetPensionLiability…………………………….. Santa Barbara County Employees’ Retirement System – Schedule of the County’s Contributions . Other Postemployment Benefits (OPEB) Plan – Schedule of Funding Progress . . . . . . . . . . . NotestoRequiredSupplementaryInformation……………………….

Governmental Funds – General and Major Special Revenue:
Statement of Revenues, Expenditures, and Changes in Fund Balances ‐ Budget and Actual:

GeneralFund…………………………………… RoadsSpecialRevenueFund…………………………… PublicHealthSpecialRevenueFund ……………………….. SocialServicesSpecialRevenueFund……………………….. Alcohol, Drug, and Mental Health Services (ADMHS) Special Revenue Fund. . . . . . . . FloodControlDistrictSpecialRevenueFund……………………. AffordableHousingSpecialRevenueFund…………………….. FireProtectionDistrictSpecialRevenueFund……………………

Other Supplementary Information (Unaudited):

Other Major Governmental Funds:
Schedule of Revenues, Expenditures, and Changes in Fund Balances ‐ Budget and Actual:

CapitalProjectsFund ………………………………. ii

Table of Contents

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Nonmajor Governmental Funds: NarrativeSummary………………………………….. 126 CombiningBalanceSheet ………………………………. 130 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances. . . . . . . 134 Schedules of Revenues, Expenditures, and Changes in Fund Balances ‐ Budget and Actual . . 138

Internal Service Funds: NarrativeSummary………………………………….. 158 CombiningStatementofNetPosition…………………………. 160 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position . . . . . . . 161 CombiningStatementofCashFlows …………………………. 162

Agency Funds: NarrativeSummary………………………………….. 164 CombiningStatementofChangesinAssetsandLiabilities. . . . . . . . . . . . . . . . . . . . 165

STATISTICAL SECTION (Unaudited)

NarrativeSummary………………………………………. 167

Financial Trends: NetPositionbyCategory…………………………………. 168 ChangesinNetPosition………………………………….. 169 FundBalances,GovernmentalFunds …………………………… 170 ChangesinFundBalances,GovernmentalFunds ……………………… 171

Revenue Capacity:
AssessedValueofTaxablePropertyandActualValueofProperty. . . . . . . . . . . . . . . . . . 172 PropertyTaxRates‐DirectandOverlappingGovernments. . . . . . . . . . . . . . . . . . . . . . 173 PrincipalPropertyTaxpayers……………………………….. 174 PropertyTaxLeviesandCollections……………………………. 175

Debt Capacity: RatiosofOutstandingDebtbyType……………………………. 176 ComputationofLegalDebtMargin…………………………….. 177 DirectandOverlappingBondedDebt …………………………… 178

Economic and Demographic Information:
DemographicsandEconomicStatistics ………………………….. 179 PrincipalEmployers……………………………………. 180

Operating Information: CountyEmployeesbyFunction/Program………………………….. 181 OperatingIndicatorsbyFunction/Program ………………………… 182 Capital Assets and Infrastructure Statistics by Function/Program . . . . . . . . . . . . . . . . . . 183

GLOSSARY

Glossary……………………………………………. 185

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Introductory Section

Introductory Section

ROBERT W. GEIS, C.P.A.

Auditor-Controller

THEO FALLATI, C.P.A.

Assistant Auditor-Controller

COUNTY OF SANTA BARBARA

OFFICE OF THE AUDITOR-CONTROLLER

August 26, 2015
To the Citizens of Santa Barbara County:

The Comprehensive Annual Financial Report (CAFR) of the County of Santa Barbara (County) for the fiscal year ended June 30, 2015, is hereby submitted in compliance with Sections 25250 and 25253 of the Government Code of the State of California.

Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive internal control framework it established for this purpose. Because the cost of internal controls should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements.

The independent auditor’s report is located at the front of the financial section of this report. Brown Armstrong Accountancy Corporation has issued an unmodified (“clean”) opinion on the County’s financial statements for the year ended June 30, 2015.

Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s report and provides a narrative introduction, overview, and analysis of the financial statements. MD&A complements this letter of transmittal and should be read in conjunction with it.

Profile of the Government

The County, located approximately 100 miles north of Los Angeles and 300 miles south of San Francisco, was established by an act of the State Legislature on February 18, 1850. It occupies 2,737 square miles, one‐third of which is located in the Los Padres National Forest, and has a population of 437,643. Eight incorporated cities are within the County: Santa Barbara, Santa Maria, Lompoc, Goleta, Carpinteria, Guadalupe, Solvang, and Buellton. The largest employment categories include services, wholesale and retail trade, public administration, and manufacturing. The mild climate, picturesque coastline, scenic mountains, and numerous parks and beaches make the County a popular tourist and recreational area.

Policymaking and legislative authority is vested in the County Board of Supervisors (Board), which consists of an elected supervisor from each of the five districts. The Board is responsible for, among other things, passing ordinances, adopting budgets and appointing committees, the County Executive Officer (CEO), and non‐elected department directors. Supervisors are elected to four‐year staggered terms with two supervisors elected in even‐ years and three supervisors elected in odd‐years. The County has five elected department directors responsible for the offices of the Clerk‐Recorder‐Assessor, Auditor‐Controller, District Attorney, Sheriff‐Coroner, and Treasurer‐Tax Collector‐Public Administrator. The following organization chart reflects the various functional categories reported in the governmentwide Statement of Activities as well as identifies principal officials.

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County Administration Bldg. 105 E. Anapamu Street, Rm. 303 Santa Barbara, CA 93101 (805) 568-2100

Auditor@co.santa-barbara.ca.us

Mailing Address:
P.O. Box 39
Santa Barbara, CA 93102-0039 FAX (805) 568-2016

Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Policy & Executive

Salud Carbajal

First District Supervisor

Janet Wolf

Second District Supervisor

Chair

Doreen Farr

Third District Supervisor

Peter Adam

Fourth District Supervisor

Vice Chair

Steve Lavagnino

Fifth District Supervisor

Mona Miyasato

County Executive Officer (CEO) General County Programs Human Resources

Michael Ghizzoni

County Counsel

Community Resources & Public Facilities

General Government & Support Services

Cathleen Fisher

Agriculture Commissioner/ Weights & Measures

George Chapjian

Community Services

Glenn Russell

Planning & Development

Scott McGolpin

Public Works

Robert W. Geis, CPA, CPFO

Auditor‐Controller

Joseph E. Holland, CPFO

Clerk‐Recorder‐Assessor

Matthew Pontes

General Services

Harry E. Hagen, CPA, CPFO

Treasurer‐Tax Collector & Public Administrator

Public Safety

Joyce Dudley

District Attorney

Raimundo Montes De Oca

Public Defender

Darrel E. Parker

Court Special Services

Eric Peterson

Fire

Guadalupe Rabago

Probation

William F. Brown

Sheriff‐Coroner

Health & Human Services

Alice Gleghorn

Alcohol, Drug, & Mental Health Services (ADMHS)

Carrie Topliffe, CPA

Child Support Services

Dr. Takashi Wada

Public Health Services

Daniel Nielson

Social Services

The County, with an average of 4,101 full‐time equivalent employees, provides a full range of services to its residents as the organization chart above depicts. Included in operations are various component units which provide specific services countywide or to distinct geographic areas within the County. They include the First 5 Children and Families Commission, County Service Areas, Public and Educational Access, Santa Barbara County Fire Protection District, Flood Control and Water Conservation Districts, Lighting Districts, Laguna County Sanitation District, Community Facilities Districts, Sandyland Seawall Maintenance District, Water Agency, In‐Home Supportive Services Public Authority, and Santa Barbara County Finance Corporation. While these entities are legally separate from the County, the County is financially accountable for them as their governing bodies are substantially the same as the County Board. Other entities, such as the Air Pollution Control District and the Santa Barbara County Association of Governments, conduct their own day‐to‐day operations, answer to their own governing board, and thus are not included in the County’s financial statements.

The County is required by state law to adopt a final budget each year. This annual budget serves as the foundation for the County’s financial planning and control. Budgets are adopted for all governmental and proprietary funds and are prepared in accordance with Generally Accepted Accounting Principles (GAAP). The legal level of budgetary control is maintained at the fund, department, and object level with more stringent control over capital assets and fund balance categories, which are maintained at the line item level. The Board must approve amendments or transfers of appropriations between funds or departments as well as items related to capital assets or fund balances. Supplemental appropriations necessary and normally financed by unanticipated revenues during the year must also be approved by the Board. The Board has delegated authority to approve transfers of appropriations between object levels within the same department to the County Executive Office.

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Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Factors Affecting Economic Condition

Unemployment Rate

Percent

10 9 8 7 6 5 4 3

2006 2015

Average Salary

Retail Sales

Thousands ofDollars

53
49
45
41
37
33
29
25

2005 2014

“Experts Predict Strong Employment Growth for

Santa Barbara County Economy”
Noozhawk May 9, 2015

Billions of Dollars 7

6 5 4

2005 2014

Median Home Price

Thousands ofDollars

800 700 600 500 400

300
2006 2015

“Housing prices going back up, but rental market exceptionally tight”

KEYT April 30, 2015

Hotel/Motel Room Sales

Millions ofDollars 450

400 350 300 250

200
2005 2014

Most of the information about the local economy is derived from the California Employment Development Department and the Bureau of Labor Statistics.

During Fiscal Year (FY) 14‐15 the County, for the fifth consecutive year, saw positive trends in certain economic segments led by consumer spending and tourism. For the third consecutive year, the real estate housing market and the labor market continued to show steady improvement.

The following highlights and graphs are evidence of the changing economy on a Countywide basis that includes both the unincorporated area and the eight incorporated cities.
Employment

 The County’s average unemployment rate during FY 14‐15 decreased from 6.4% to 5.6%.

 The June 2015 County unemployment rate of 4.7% was below the State “Santa Barbara County Has Fared Better Than Most”

unemployment rate of 6.2% and the national unemployment rate of

5.5%.

Income

Santa Maria Times April 23, 2009

 Average annual wages had a slight increase to $50,130 in 2014 from $48,820 in 2013.

Retail Sales

  •   Countywide retail sales increased 5.2% to $6.7 billion for the 2014 calendar year, slightly up from $6.4 billion in 2013.
  •   Local retail sales continued to grow with the expandable economy from the December 2010 low point..

 California retail sales are following a similar pattern.

“Economist: Light At End Of Tunnel To Brighten By

Real Estate

Late 2010”

 The countywide median home prices increased 7.4% to $697,022. Santa Barbara News-Press October 3, 2009

 The real estate market continued its upward trend with increased property sales, price appreciation, and new construction.

Tourism

  •   Transient occupancy tax increased 16.1% in FY 13‐14, driven by the robust tourism industry.
  •   The County’s wide array of resorts, hotels, motels, and vacation rentals all contributed to the increase in this tax source.

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Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Economic Indicators

The County’s economy is showing strong growth as consumer spending and tourism has increased for the fifth consecutive year. Local unemployment continues a steady decline, with a June unemployment rate of 4.7% that was below the State unemployment rate of 6.2% and the national unemployment rate of 5.5%. The local housing market continues to rebound after hitting bottom in 2012. The growth rate in the increase of home prices has moderated somewhat over the past, yet still is on an upward trajectory. There also has been a steady stream of building permitting, new housing starts, and home sales.

Financial Indicators

County tax revenues experienced strong growth due to increases in real property values, tourism and consumer spending. Property tax is the County’s largest source of discretionary revenue. Certain leading indicators of future property tax growth are property transfer taxes that increased 18.6% to $4.1 million and supplemental tax decreased 7.5% to $3.7 million (after a growth of 32% in the prior year and a delay in some supplemental billings due to a new tax system implementation). The secured property tax growth rate for FY 14‐15 was 5.5% and for FY 15‐16 is estimated at 5%. With these accounts showing mostly positive growth, the County general discretionary revenues are expected to continue to grow annually in the 4%‐6% range for the foreseeable future.

Growth in transient occupancy tax (TOT) and local retail sales tax have been strong at 13.4% and 13.3%, respectively. Statewide sales tax for Proposition 172 public safety, a 1⁄2 cent tax, grew 6.4% to $34.2 million. The County also had modest growth in State Realignment 1991 and 2011, sales taxes and vehicle license fees that are distributed to the County for Public Safety and Health and Human Services that reached $98.1 million. The implementation of the Affordable Care Act has significantly increased Medi‐Cal reimbursements and Social Services reimbursements for Medi‐ Cal eligibility programs.

On the expenditure side, the largest category of expenditures as a service organization is County salaries and benefits, which increased by $23 million or 5% to $495 million. This represents 61% of total County governmental fund expenditures. The majority of the increase is due to the addition of 141 Full Time Equivalents (FTE) at a cost of $17 million annually and mainly due to the implementation of the Affordable Care Act. The remainder is due to base salary increases of approximately 1.8%.

Major Initiatives

During the last fiscal year, under the leadership of the Board of Supervisors, several outstanding key programs and projects were successfully undertaken by the County that:

  •   Facilitated coordination and housed emergency operations for the Plains All American Oil spill that occurred on May 19, 2015. The spill, located near Refugio Beach, is estimated to have leaked 21,000 gallons of oil. This event occurred on the Gaviota coast and spilled into the ocean and involved multi‐agency cooperation. The County was impacted financially and operationally throughout the event.
  •   Maintained organizational stability, customer service levels, and program efficiencies during the leadership changeover of the Alcohol, Drug, and Mental Health Services Director, Fire Chief, Chief Probation Officer, and Community Services Department Director.
  •   Continued the next steps to build the new Northern Branch Jail and for the associated Sheriff’s Transition and Reentry (STAR) facility. These next steps included completion of contract negotiations and finalizing agreements with the State and County, Board execution of four professional service agreements, facilitation of several design workshops with multiple stakeholders, and State acceptance of the schematic designs.
  •   Continued the foundational work for implementing the goals for Alcohol, Drug, and Mental Health Ser‐ vices’ (ADMHS) “System of Change” being led now by the new ADMHS Director.
  •   Emphasized a commitment to technological progress and improvements by:

 Going live with Phase I of a multi‐department, multi‐year project for a new property tax system. The primary

public impact of Phase I included the issuance of new tax bills to property owners.

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Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Major Initiatives (cont’d)
 Deploying a new web‐based budget search tool for the public. The new tool presents budget data in an easy

to review format designed with public viewers in mind.

  •   Continued improvement changes throughout the Recommended Budget document by including detailed program detail for positions, analyses, and financial data. These improvements are now accessible via the County’s website with the new budget search tool.
  •   Studied governing options with associated financing analyses for the Isla Vista community in order to better address needed public services in such a uniquely transient and densely populated area. Supported the first legislative steps of self‐governance for a proposed community services district.
  •   Took steps to recognize, address, and plan for current and future County infrastructure needs by developing a policy for a planned set‐aside of available discretionary General Fund funds to go towards deferred maintenance.
  •   Prepared for and implemented provisions of the new “Omni Circular” or “Super Circular” issued by the Federal Government. These new regulations impact all County departments who receive Federal money either directly or as passed through by the State. The regulations impact: 1) purchasing rules and professional service contracts that are issued to perform services paid for with Federal money, 2) single audit procedures, 3) cost plan provisions, and 4) administrative requirements.
  •   Continued measures to respond to the Statewide drought by requiring 20% water conservation measures for the local community.
  •   Received Coastal Commission approval to leave the Goleta Beach buried rock revetment in place to protect the County’s most heavily visited park from large storm events. This approval came after years of work to find a solution that balanced coastal processes and public access. The park will remain as‐is and the County will perform specific monitoring requirements over the next 20 years and will measure any changes to the beach and revetment accordingly.

    Significant Capital Projects and Operating Impacts

    The County completed $18.6 million in capital projects in the current year, and has approved $64.8 million in capital and capital maintenance projects, equipment, software, and information systems projects for FY 15‐16, as described in Section E “Capital Budget Summary” of the County’s Proposed Operating Budget (available at http://www.countyofsb.org/ceo/ index.asp). The largest of the ongoing projects relates to transportation improvements.

    Long‐term Financial Planning

    Local assessed property values for FY 14‐15 grew approximately 5.0%; this will increase secured property tax revenues by approximately an equal percentage. The FY 15‐16 budget was adopted reflecting a 3.4% increase in secured property taxes when measured against FY 14‐15 actual revenues.

    The County is committed to building and maintaining a strategic reserve of $29.9 million, equal to 8% of annual General Fund revenues, or approximately 30 days working capital. The County’s final budget resolution for FY 15‐16 directs that any General Fund unassigned fund balance be added to the strategic reserve until the target is met. The General Fund ended FY 14‐15 with a strategic reserve balance of $29.6 million which requires an increase of $.3 million of unassigned fund balance to meet the target.

    The County’s Five‐Year Capital Improvement Plan (CIP) identifies capital needs as well as funding sources and funding shortfalls. For FY 15‐16, the CIP includes $64.8 million of funding for planned projects that are included in the budget.

    FY 2014‐15 significant projects include:

    •   $18.3 million for the North Branch County Jail (total estimated project cost of $141 million).
    •   $7.3 million for flood channel improvements in North & South County (total estimated project cost of $92.2

      million).

    •   $4.3 million for landfill improvement projects in North and South County (total estimated project cost of

      28.8 million).

    •   $5.4 million for culvert improvements in Goleta (total estimated project cost of $11.4 million).

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Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Relevant Financial Policies

The County benchmarks its financial policies to a set of Best Financial Management Practices for Governmental Issuers of Municipal Debt published by Fitch Ratings.

Fund Balance Reserve

The County is committed to building a strategic reserve as discussed previously in Long‐Term Financial Planning.

Multiyear Financial Forecasting

The County’s Recommended Operational Plan includes a five‐year financial forecast focusing on discretionary revenues and their uses to aid in current year decisions.

Quarterly Financial Reporting and Monitoring

The CEO and Budget Director chair quarterly projection reviews of each department’s monthly actual and projected revenues and expenditures. These meetings also focus on their operations and performance measures.

Contingency Planning

The County does not have a formal contingency policy and maintains only a small operating contingency of less than 1% in the General Fund. However, the County has established a strategic reserve policy, and is in the process of building a strategic reserve that will equal 8% of annual General Fund revenues (approximately 30 days working capital). The County also has other significant fund balances in its special revenue funds. The most noteworthy is the Flood Control District fund balance used to hedge against storm related disasters.

Nonrecurring Revenue

One of the principal budget tenets is that nonrecurring revenue should be used for one time needs and that ongoing expenditures should have identified ongoing sources. Additionally, the County’s General Fund Allocation Policy states that “Requests for additional FTE’s … will identify the ongoing funding source.”

Financial Reporting Awards

The Government Finance Officers Association (GFOA) has awarded the Certificate of Achievement for Excellence in Financial Reporting to the County for its CAFR for twenty‐ four consecutive years and the Certificate of Achievement in Popular Annual Financial Reporting for twenty‐four consecutive years.

Debt Affordability

The County established a Debt Advisory Committee (DAC) to provide advice to the Board on debt issuance and management. In addition, all long‐term equipment or real property leases are reviewed for lease vs. purchase decisions.

Pay‐As‐You‐Go Capital Funding

The County policy on pay‐as‐you‐go is not formalized. However, many of the County’s funds only utilize pay‐as‐ you‐go financing. The DAC looks at repayment sources as one of the key criteria for approval of new debt issues.

Debt Repayment Plan

The County’s current outstanding debt schedule features a debt repayment plan that will reduce debt by 60% over the next ten years.

Five‐Year Capital Improvement Program

The County’s Five‐Year Capital Improvement Program provides for an integration of capital projects and operating impacts in the proposed operating budget for each budget cycle.

Budgeting Awards

The GFOA has presented the Distinguished Budget Presentation Award to the County for seventeen consecutive years.

Superior Debt Disclosure Practices

The County maintains a complex set of debt disclosures in the County’s Recommended Operational Plan and the CAFR statistical section. We believe that time is of the essence in the publication of these documents. The budget is adopted before June 30 and loaded into the financial system before the close of the first month of the new fiscal year. The CAFR publication date is generally within 45‐60 days of the close of the fiscal year. The County’s major financial documents are available on the web at http://www.countyofsb.org.

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Letter of Transmittal

County of Santa Barbara—Comprehensive Annual Financial Report for Year Ended June 30, 2015

Awards and Acknowledgments

Financial Reporting Certificate of Achievement: The GFOA awarded a Certificate of Achievement for Excellence in Financial Reporting to the County’s CAFR for the fiscal year ended June 30, 2014. This was the twenty‐fourth consecutive year that the County has achieved this prestigious award. In order to be awarded a Certificate of Achievement, the government had to publish an easily readable and efficiently organized CAFR that satisfied both GAAP and applicable legal requirements.

A Certificate of Achievement is valid for a period of one year only. We believe our current CAFR continues to meet the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.

Budget Presentation Award: The County received the GFOA’s Distinguished Budget Presentation Award for its annual budget document for the fiscal year beginning July 1, 2014. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications device.

Popular Financial Reporting Award: The County received the GFOA’s Award for Outstanding Achievement in Popular Annual Financial Reporting for its Popular Annual Financial Report for the fiscal year ended June 30, 2014. This award is a prestigious national award that recognizes conformance with the highest standards for preparation of state and local government popular reports. In order to receive this award, a government must publish a Popular Annual Financial Report, whose contents conform to program standards of creativity, presentation, understandability, and reader appeal.

Acknowledgments: The preparation of the CAFR and its timely issuance is the result of a concentrated, dedicated, and coordinated effort by

the entire Auditor‐Controller staff. We would like to acknowledge the special efforts of the Financial Reporting Division for their assistance in the report’s preparation. We would also like to thank all County departments who participated in its preparation.

Respectfully submitted,

Mona Miyasato Robert W. Geis, CPA, CPFO County Executive Officer Auditor‐Controller

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8

Financial Section

Financial Section

INDEPENDENT AUDITOR’S REPORT

To the Honorable Board of Supervisors County of Santa Barbara, California

Report on Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the County of Santa Barbara, California, as of and for the year ended June 30, 2015, and the related notes to the financial statements which collectively comprise the County of Santa Barbara’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

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 we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial statements. The procedures selected depend on the auditor’s judgment,

including the assessment of the risks of material misstatement of the financial statements, whether

due to fraud or error. In making those risk assessments, the auditor considers internal control

relevant to the entity’s preparation and fair presentation of the financial statements in order to

design audit procedures that are appropriate in the circumstances, but not for the purpose of

expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express

no such opinion. An audit also includes evaluating the appropriateness of accounting policies used

and the reasonableness of significant accounting estimates made by management, as well as

evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis

for our audit opinions.

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the County of Santa Barbara, as of June 30, 2015, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

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Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis on pages 11–27, the Santa Barbara County Employees’ Retirement System Schedule of the County’s Proportionate Share of the Net Pension Liability and the Santa Barbara County Employees’ Retirement System Schedule of the County’s Contributions on page 110, the schedule of funding progress for the County of Santa Barbara’s Other Post Employment Benefit (OPEB) plan on page 111, and the respective budgetary comparison for the General and Major Special Revenue funds on pages 113–120; 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 (GASB), who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the County of Santa Barbara’s basic financial statements. The introductory section, the budgetary comparison for the Capital Projects fund, combining and individual nonmajor fund financial statements and schedules, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The budgetary comparison for the Capital Projects fund and the combining and individual nonmajor fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the budgetary comparison for the capital projects funds and the combining and individual nonmajor fund financial statements are fairly stated in all material respects in relation to the basic financial statements as a whole.

The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them.

Implementation of New Accounting Standards

As disclosed in the Note 1 to the financial statements, the County of Santa Barbara implemented GASB Statement No. 68, Accounting and Financial Reporting for Pensions – an amendment of GASB Statement No. 27, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date – an amendment of GASB Statement No. 68, during the fiscal year 2015.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated August 26, 2015, on our

consideration of the County of Santa Barbara’s internal control over financial reporting and on our tests of its

compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The

purpose of that report is to describe the scope of our testing of internal control over financial reporting and

compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting

or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing

Standards in considering County of Santa Barbara’s internal control over financial reporting and compliance.

Bakersfield, California

August 26, 2015

BROWN ARMSTRONG ACCOUNTANCY CORPORATION

10

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

The information in this section is not covered by the Independent Auditor’s Report, but is presented as required supplementary information for the benefit of the readers of the Comprehensive Annual Financial Report (CAFR).

As management of the County of Santa Barbara, California (the County), we offer readers of the County’s financial statements this narrative overview and analysis of the financial activities of the County for the year ended June 30, 2015. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in the County’s Basic Financial Statements, which immediately follow this section. All dollar amounts are expressed in thousands.

Contents

Description of the Basic Financial Statements 12 Governmentwide Financial Statements 12 Fund Financial Statements 12 Notes to the Financial Statements 13 Appropriated Funds 14

Financial Highlights 15 New Significant Accounting Standards Implemented 15 Governmentwide Financial Analysis 15 Financial Analysis of the County’s Funds 15

Governmentwide Financial Analysis 16 Analysis of Net Position 16 Analysis of Governmental Activities 18 Analysis of Business‐type Activities 20

Financial Analysis of the County’s Fund Balances 21 Governmental Funds 21 Proprietary Funds 22

Capital Asset & Debt 23 Capital Assets 23 Debt 24

Deferred Outflows of Resources & Deferred Inflows of Resources 25 Deferred Outflows of Resources 25 Deferred Inflows of Resources 25

General Fund Budgetary Highlights 26 Economic Factors and Next Year’s Budget and Rates 27

Requests for Information

27

Unaudited and in thousands

11

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Description of the Basic Financial Statements

Management’s Discussion and Analysis introduces the County’s Basic Financial Statements. The County’s Basic Financial Statements include three components:

  •   Governmentwide Financial Statements
  •   Fund Financial Statements
  •   Notes to the Financial Statements

    Governmentwide Financial Statements

    The Governmentwide Financial Statements provide readers with a broad overview of the County’s finances, in a manner similar to a private sector business.

    The Statement of Net Position presents information on all of the County’s Assets and Deferred Outflows of Resources and Liabilities and Deferred Inflows of Resources with the difference reported as Net Position.

    Net Position = (Assets + Deferred Outflows of Resources) – (Liabilities + Deferred Inflows of Resources)

    Over time, increases or decreases in Net Position are a useful indicator of an improving or deteriorating County financial condition.

    The Statement of Activities presents the most recent fiscal year changes in the County’s net position. 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 (Accrual Basis of Accounting). The statement reports items resulting in cash flows in future fiscal periods (e.g., uncollected taxes, and earned but unused vacation leave) as revenues and expenses.

    The Governmentwide Financial Statements distinguish functions of the County principally supported by taxes

and intergovernmental revenues (governmental activities) from other functions intended to recover all or a significant portion of their costs through user fees and charges (business‐type activities). The governmental activities grouped by function of the County include Policy & Executive, Public Safety, Health & Public Assistance, Community Resources & Public Facilities, General Government & Support Services, and General County Programs. The business‐type activities of the County include Resource Recovery and Laguna Sanitation.

Component units are included in the financial statements and are legally separate entities for which the County is financially accountable. These have

substantially the same governing board as the County or provide services entirely to the County. The following is a list of these component units:

 First 5 Children and Families Commission – this entity has separately issued financial statements.

 County Service Areas

 Public and Educational Access

 Santa Barbara County Fire Protection District

 Flood Control and Water Conservation Districts

 Lighting Districts
 Laguna County Sanitation District
 Community Facilities Districts
 Sandyland Seawall Maintenance District
 Water Agency
 In‐Home Supportive Services Public Authority  Santa Barbara County Finance Corporation

Pages 30‐31 of this report display the Governmentwide Financial Statements.

Fund Financial Statements

A fund is a grouping of related accounts used to maintain control over resources segregated for specific activities or objectives. The County, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance‐related legal requirements.

The County’s funds are divided into three types:

  •   Governmental funds
  •   Proprietary funds
  •   Fiduciary funds

    Governmental Funds

    Governmental funds account for essentially the same functions reported as governmental activities in the Governmentwide Financial Statements. However, unlike the Governmentwide 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 (Modified Accrual Basis of Accounting). Such information may be useful in evaluating the County’s near‐term financing

Unaudited and in thousands

12

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

requirements. To understand the long‐term impact of the County’s near‐term financing decisions, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the Governmentwide Financial Statements. Both the Governmental Funds Balance Sheet and the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The County maintains 64 individual governmental funds combined into 28 funds for financial reporting purposes. The County segregates from the General Fund a number of significant functions in 8 major funds. Information is presented separately in the Governmental Funds Balance Sheet and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances for the General; Roads; Public Health; Social Services; Alcohol, Drug, and Mental Health Services (ADMHS); Flood Control District; Affordable Housing; Fire Protection District; and Capital Projects funds, all considered major funds. Data for the other 19 governmental funds are combined into a single, aggregated presentation. Individual fund data for these nonmajor governmental funds are provided in the form of combining statements elsewhere in this report.

The County adopts an annual appropriated budget for all of its operating funds. The budget and actual comparison schedules provided for the General Fund and major special revenue funds demonstrate performance against this budget.

Pages 32‐38 of this report display the Governmental Funds Financial Statements.

Proprietary Funds

The County maintains two different types of proprietary funds: enterprise funds and internal service funds. Both enterprise funds qualify as major funds.

Enterprise Funds report the same functions presented as business‐type activities in the governmentwide financial statements. The County uses enterprise funds to account for Resource Recovery and Laguna Sanitation.

Internal Service Funds are an accounting device used to accumulate and allocate costs internally among the County’s various functions. The County’s internal service funds account for information technology services, vehicle operations and maintenance, risk

management and insurance, communications services, and utilities. Since these services predominantly benefit governmental rather than business‐type functions, they are consolidated within governmental activities in the governmentwide financial statements.

Proprietary funds provide the same type of information as the governmentwide financial statements, only in more detail. The proprietary funds financial statements provide separate information for the Resource Recovery and Waste Management Fund (Resource Recovery), and the Laguna Sanitation Fund. Data for the five internal service funds are combined into a single, aggregated presentation in the proprietary funds financial statements.

Pages 40‐42 of this report display the Proprietary Funds Financial Statements.

Fiduciary Funds

Fiduciary funds account for resources held for the benefit of parties outside the County. Fiduciary funds are not reflected in the Governmentwide Financial Statements because the resources of those funds are not available to support the County’s own programs. Fiduciary fund accounting is similar to proprietary fund accounting. Fiduciary funds report the external portions of the Treasurer’s investment pool, private‐ purpose trust fund, and agency funds.

Pages 43‐44 of this report display the Fiduciary Funds Financial Statements.

Notes to the Financial Statements

The Notes to the Financial Statements provide additional information that is essential to a full understanding of the data provided in the Governmentwide and Fund Financial Statements. Information in the Notes to the Financial Statements is described as follows:

 Note 1 provides a general description of the County’s Significant Accounting Policies.

 Notes 2 & 3 provides information on Budgetary and Legal Compliance and Reconciliation for Governmentwide and Fund Financial Statements.

 Notes 4 to 20 provide detailed notes on cash and investments, capital assets, debt obligations, and fund balances.

 Notes 21 to 24 provide information on retirement plans, retiree and other health benefits, and summarizes any necessary prior period adjustments.

Pages 45‐110 of this report display the Notes to the Financial Statements.

Unaudited and in thousands

13

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Appropriated Funds

Governmental Funds

Proprietary Funds

General Fund (Major Fund)

Special Revenue Funds

Capital Project Funds

Debt Service Funds

Internal Service Funds

Enterprise Funds

General Fund Departments

Policy & Executive

Board of Supervisors

County Executive Office

County Counsel

Public Safety

Courts District Attorney Public Defender Probation Sheriff

Health & Public Assistance

Public Health Social Services

Community Resources & Public Facilities

Ag Commission

Community Services

Planning & Devel. Public Works

General Government & Support Services

Auditor‐Controller

Clerk‐Recorder‐ Assessor

General Services

Treasurer‐Tax‐ Collector

General County Programs

General County

Major Funds: Roads

Public Health Social Services ADMHS
Flood Control District Affordable Housing Fire Protection

District

Non Major Funds: First 5 Children & Families Commission

Fish & Game Petroleum

Public & Educational Access

Special Aviation IHSS

Child Support Services

Fishermen Assistance

Coastal Resources Enhancement

Court Activities

Criminal Justice Construction

Courthouse Construction

Inmate Welfare

Special Districts Under the Board of Supervisors

Major Fund: Capital Projects

Non Major Fund: Santa Barbara County Finance Corporation

Legend:

Governmental Activities featuring Departments

Governmental Activities

Business‐Type Activities

Non Major Funds: Information Technology Services

Vehicle Operations and Maintenance

Risk Management and Insurance

Communications Services

Utilities

Major Funds: Resource Recovery

Laguna Sanitation

County Service Areas

Community Facilities Districts

Lighting Districts

Sandyland Seawall Maintenance

Water Agency

Governmental Activities

Business‐ Type Activities

Unaudited and in thousands

14

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Financial Highlights

New Significant Accounting Standards Implemented

In fiscal year 2014‐15, the County adopted two new statements of financial accounting standards issued by the Governmental Accounting Standards Board (GASB) that relate to pension activity:

  •   Statement No. 68, “Accounting and Financial Reporting for Pensions—an amendment of GASB Statement No. 27,” and
  •   Statement No. 71, “Pension Transition for Contributions Made Subsequent to the Measurement Date—an amendment of GASB Statement No. 68”

    Statement No. 68 (Statement) establishes standards of accounting and financial reporting, but not funding or budgetary standards, for the County’s defined benefit pension plans. This Statement replaces the requirements of prior GASB statements impacting accounting and disclosure of pensions.

    The significant impact to the County of implementing Statement No. 68 is the reporting of the County’s unfunded pension liability on the County’s full accrual basis of accounting governmentwide financial statements. There are also new note disclosure requirements and supplementary schedules required by the Statement.

    The measurement date for the pension liabilities is as of June 30, 2014. This date reflects a one year lag and was used so that these financial statements could be issued in an expedient manner. Activity (i.e., contributions made by the County) occurring during fiscal year 2014‐15 are reported as deferred outflows of resources in accordance with Statement No. 71.

    In order to implement the Statement, a prior period adjustment was made to the County’s July 1, 2014 net position. This prior period adjustment decreased the County’s net position by $611,015 from $915,720 to $304,705 and reflects the reporting of: 1) net pension liabilities of $721,772, and 2) deferred outflows of resources of $110,756. Please refer to Note 21 for more information regarding the County’s pensions.

    The adoption of Statement No. 68 has no impact on the County’s governmental fund financial statements, which continue to report expenditures equal to the amount of the County’s actuarially determined contribution (formerly referred to as the “annual required contribution”). The calculation of pension contributions is also unaffected by this Statement.

Governmentwide Financial Analysis

The assets and deferred outflows of resources of the County exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $362,003 (See Summary of Net Position and analysis on page 16).

 $662,977 represents the County’s investment in capital assets, less (1) accumulated depreciation, (2) related outstanding debt used to acquire those assets, and (3) related deferred inflows of resources.

 $236,552 is available for the County’s ongoing obligations related to programs with external restrictions.

 ‐$537,526 is primarily the result of the County’s unfunded pension and Other Postemployment Benefits (OPEB) obligations.

The County’s total net position decreased by $553,717 over the prior year:

  •   The $14,101 increase in net position invested in capital assets, net of related debt, represents the change in capital expenditures less depreciation, the retirement of related long‐term debt, and amortization of related deferred inflows of resources.
  •   The $16,678 increase in restricted net position represents the change in resources that are subject to external restrictions on their use.
  •   The $584,496 decrease in unrestricted net position is the change in resources available to fund County programs to citizens and debt obligations to creditors.

    Financial Analysis of the County’s Funds

    The County’s governmental funds’ combined ending fund balance of $281,044 was an increase of $17,796 from the prior year ending fund balance of $263,248. Amounts available for spending include Restricted, Committed, Assigned, and Unassigned Fund Balances; these totaled $268,873, or 96% of ending fund balance. Of this amount:

     $185,102 is restricted by law or externally imposed requirements,

     $80,529 is committed for specific purposes, and  $3,242 is unassigned fund balance.

    Spendable fund balance for the General Fund increased $5,407 to $88,075, which equates to 27% of total General Fund expenditures for the year.

Unaudited and in thousands

15

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Governmentwide Financial Analysis

Summary of Net Position

Governmental Activities

Business‐type Activities

2014 2015 2014

$ 51,453 84,756 136,209

Total

Total Change

Percent Change

Dollar

2014

$ 462,848 664,907 1,127,755

2015

2015

Assets:

Current and other assets
Capital assets, net of depreciation

Total assets
Deferred outflows of resources:

Deferred social services Deferred pensions

Liabilities:

Current and other liabilities Long‐term liabilities

Total liabilities
Deferred inflows of resources:

Deferred SCAs
Deferred housing loan payments Deferred pensions

Total deferred inflows of reources Net position:

Net investment in capital assets Restricted
Unrestricted

Total net position


– —

$ 488,780 675,558

$ 55,865 86,724

$514,301 749,663

$ 544,645 762,282

$ 30,344 6% 12,619 2% 42,963 3%

514 100% 117,156 100% 117,670 100%

13,933 18% 576,913 245% 590,846 189%

1,261 4% – 0% 122,243 100% 123,504 345%

14,101 2%

16,678 8% (584,496) (1,244%) $ (553,717) (60%)

1,164,338

514 115,087

33,096 3,948 120,084

588,989

236,552 (551,588)

142,589

– 2,069

1,263,964

31,835 3,948 –

– –

1,306,927

514 117,156

115,601

88,925 759,933

2,069

1,737 52,712

76,729 235,732

117,670

90,662 812,645

848,858

54,449

312,461

903,307

– 2,159

33,096 3,948 122,243

157,128

2,159

35,783

648,876 219,874 46,970

159,287

73,988 – 14,062

662,977

236,552 (537,526)

$

74,292 197,713 272,005

31,835 3,948 – 35,783

578,314 219,874 21,779 819,967

$

– –

2,437 38,019 40,456

– – – –

70,562 – 25,191 95,753

$ 273,953

$ 88,050

$915,720

$ 362,003

As noted earlier, over time, net position may serve as a useful indicator of a government’s financial condition. In the case of the County, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $362,003 at the close of the current fiscal year.

Analysis of Net Position

The County’s total net position decreased by $553,717, or 60%, during the fiscal year. As described below, the County experienced a net decrease mainly due to changes in unrestricted net position.

Net investment in capital assets

The largest portion of the County’s net position is invested in capital assets (e.g., land, buildings, roads, bridges, flood control channels and debris basins, machinery, equipment, and intangible assets), less the related and outstanding debt used to acquire those assets. The County uses these capital assets to provide services to citizens; as such, these assets are not available for future spending. Although the County’s investment in its capital assets is reported net of

related debt, the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

The County’s net investment in capital assets was

$662,977 at year‐end, and consisted of the following:

The $14,101, or 2%, increase in net position from the net investment in capital assets represents capital acquisitions and deletions, less current year depreciation, and the addition and/or retirement of related long‐term debt and deferred inflows of resources. Capital additions were related primarily to infrastructure (roads & road improvements) and building projects. The County also completed phase 1 of

Investment in Capital Assets (net of
accumulated depreciation) $

Less:
Related Debt $ Related Deferred Inflows of Resources $

Net Investment in Capital Assets $

762,282

66,865

32,440 662,977

Unaudited and in thousands

16

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

the Property Tax Project for $6,500. The County recorded depreciation of $25,803 against its assets.

Restricted net position

Restricted net position of $236,552 represents

resources that are subject to external restrictions on their use or by enabling legislation. Due to the unique nature of funding sources, the County has significantly more restricted net position dollars than unrestricted net position dollars. Restricted net position is comprised of the following:

  •   43% for property taxes dedicated to specific services such as flood control and fire protection
  •   9% for numerous State imposed restrictions
  •   13% for federal and state allocations for roads and

    health services

  •   29% for federal imposed restrictions for federally‐ qualified health centers and housing programs
  •   5% for grant, land use, and permit agreements

 1% for various County imposed purposes

Restricted net position increased $16,678, or 8%. Significant changes to restricted net position, by function, include:

  •   The Community Resources and Public Facility function increased $8,524 as a result of Roads and the Water Agency’s carryover funding for projects from the prior year.
  •   The Public Safety function increased $4,533 due primarily to the Fire District’s increases in property taxes and the Probation department’s unspent Public Safety realignment funds (AB109).

    Unrestricted net position

    Unrestricted net position in the amount of ‐$537,526, a decrease of 1,244% from prior year, is the change in resources available to fund County programs to citizens and debt obligations to creditors. The majority of positive unrestricted net position resides in the County’s General Fund and the negative unrestricted net position is primarily the result of the County’s unfunded pension and OPEB obligations.

Net Position

1 4‐ 15 1 3‐ 14

‐$538

$663 $649

Net Investment in Capital Assets

Rest ric ted

Unrest ric ted

Total

$916

$237 $220

$362

‐$800

‐$600 ‐$400

$47

‐$200 $0 $200 $400

In Millions

$600 $800

$1,000

Unaudited and in thousands

17

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Analysis of Governmental Activities

Changes in Net Position (in thousands)

Governmental Business‐type

Total

Activities

2014 2015 2014

173,875 332,533 52,352

558,760

231,247 155 14,039 7,539 1,407 73 8,027

262,487 821,247

14,057 282,251 319,565

92,377 33,931 3,980 3,505 — — 749,666

71,581 (34) 71,547

712,003 36,417 748,420 819,967

Activities

Total

Dollar Change

Percent Change

2015 2014

2015

Revenues

Program revenues:
Charges for services
Operating grants and contributions Capital grants and contributions

Total program revenues General revenues:

Property taxes
Motor vehicle in‐lieu tax
Sales taxes
Transient occupancy tax Unrestricted investment earnings Gain (loss) on sale of capital assets Other

Total general revenues

Total revenues

Expenses

Policy & executive
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs
Interest on long‐term debt
Resource recovery
Laguna sanitation

Total expenses
Excess (deficiency) of revenues

over (under) expenses

Transfers

Change in net position

Net position ‐ beginning
Prior period adjustment
Net position ‐ beginning, as restated Net position ‐ ending

$

$ 184,591 346,620 44

$ 33,346 1,038 —

$ 34,253 987 —

$ 207,221 333,571 52,352

$ 218,844 347,607 44

$

11,623 6%

14,036 4% (52,308) (100%)

(26,649) (4%)

12,892 6% (5) (3%) 1,267 9% 1,011 13% 164 9% 134 156% 189 2%

15,652 6% (10,997) (1%)

(3,336) (24%) (5,563) (2%) 15,567 5% (3,589) (4%)

3,835 11% (1,518) (38%) (854) (24%) 5,950 29% 94 2% 10,586 1%

(21,583) (27%) — — (21,583) (27%)

116,263 15% (648,397) (1780%) (532,134) (64%)

531,255

34,384

— — — —

344 13 —

35,240

593,144

566,495

244,139 150 15,306 8,550 1,661

258 8,216

— — — —

254 (38) —

231,247 155 14,039 7,539 1,751

86 8,027

244,139 150 15,306 8,550 1,915

220 8,216

278,280

357

216

262,844

278,496

809,535

34,741

35,456

844,991

10,721 276,688 335,132

88,788 37,766 2,462 2,651 — —

— — — — — — —

20,300 6,176

— — — — — — —

26,250 6,270

855,988

14,057 282,251 319,565

92,377 33,931 3,980 3,505 20,300 6,176

10,721 276,688 335,132

88,788 37,766 2,462 2,651 26,250 6,270

754,208

55,327 –

26,476

8,265 34

32,520

786,728

2,936 –

776,142

79,846 —

58,263 —

55,327

8,299

2,936

79,846

58,263

819,967 (601,341)

87,454 —

95,753 (10,639)

799,457 36,417

915,720 (611,980)

218,626

$

$ 273,953

87,454

$ 95,753

85,114

$ 88,050

835,874

303,740

$ 915,720

$ 362,003

$ (553,717) (60%)

Governmental activities decreased the County’s net position by $546,014 to $273,953 for the year ended June 30, 2015, accounting for 99% of the County’s total decrease in net position. Governmental activities operating revenues exceeded operating expenditures by $55,327. A prior period adjustment of $601,341, is mostly the result of the County’s unfunded pension and OPEB obligations.

Revenues

Total revenues for the County’s Governmental Activities had an overall decrease from the prior year of $11,712, or 1%, to $809,535. However, adjusting for the prior year $45,301 recording of the Santa Maria Levee (SML) Federal government capital contribution, operating revenue increased by 4%, or $33,589. Revenues are divided into two categories: Program Revenues and General Revenues.

Program Revenues had an overall decrease of $27,505, or 4.9%, to $531,255 from the prior year; however, if adjusted for the Santa Maria Levee, program revenues increased by 3%. As an arm of the State government, a significant portion of charges for services and operating grants and contributions are tied to mandated services such as public assistance, health and Alcohol, Drug, & Mental Health Services (ADMHS). Total program revenues represent 66% of the County’s funding for governmental activities.

 Charges for services increased $10,716, or 6%, to $184,591 primarily due to $7,147 increase in health care fees, a $6,493 increase in ADMHS State and Federal revenue, a $1,811 increase in Fire incident reimbursements, a decrease in $4,388 recycled affordable housing revenue, and a decrease of $2,909 in grant and audit settlement revenue.

Unaudited and in thousands

18

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

 Operating grants and contributions (intergovernmental revenues) increased $14,087 or 4%, to $346,620 primarily due to a $6,093 increase in Senate Bill (SB) 90 Mandated Costs reimbursement, a $3,090 increase in Federal Cal Works Administration, a $2,060 increase Proposition 172 monies, a $3,622 increase in the State and Federal food stamp programs, a $2,928 increase in Federal and State medical administration costs, offset by a $4,508 decrease in Motor Vehicle In‐Lieu taxes.

 Capital grants and contributions (intergovernmental revenues) decreased $52,308, or 100%, to $44 due primarily to a reduction in the number of donations to the County.

General Revenues had an overall increase of $15,793 or 6% to $278,280. These revenues included general taxes which provided the Board of Supervisors with the most discretionary spending ability. Since the formation of County government in the 1850’s, basic public safety services such as sheriff, fire, and district attorney consume most of these resources. The increase in general revenues is due primarily to the following changes:

  •   Property Tax Revenue increased $12,892, or 6%, to $244,139.
  •   Sales Tax Revenue increased $1,267, or 9%, to $15,306.
  •   Transient Occupancy Tax revenue increased $1,011, or 13%, to $8,550.
  •   Unrestricted Investment Earnings increased $254, or 18%, to $1,661 due to interest paid by the State on pre‐2004 SB 90 Mandate Reimbursements.

    Expenses had an overall increase for governmental activities of $4,542, or 1%, to $754,208 from the prior year.

    As a service delivery entity, the County’s major cost component is salaries and benefits, amounting to 63% of the total County expenses. The average full‐time equivalent (FTE) count for the County (including business‐type activities) had a net increase of 140 FTEs from 3,961 in the prior year to 4,101 at June 30, 2015. The change in FTE adds approximately $17 million in total salary and benefit costs to the on‐going costs of County operations.

Program expenses for the County’s governmental activities are generally attributable to the following factors:

  •   Total salaries and benefits expense decreased $6,735, or 1.4%, to $472,787 across all functions and is primarily made up of the following:
    •   An increase in regular salary costs of $12,737, or 5%, to $283,990 primarily due additional positions and merit increases and cost of living adjustments (COLAs).
    •   A decrease in retirement pension expense of $34,215, or 28%, to $88,105, due to accounting changes required by GASB Statement No. 68 for recording pension expense.
    •   A increase in overtime costs of $1,318, or 9%, to $16,663.
    •   An increase in health insurance costs of $2,673, or 11%, to $27,243.
    •   An increase in reimbursable overtime cost of $60, or 2%, to $3,051 for fire incident responses.
    •   An increase in extra help costs of $2,412, or 25%, to $11,936.
    •   Anincreaseinworkers’compensationexpense of $2,010, or 19%, to $12,784 due to a reduction in the workers’ compensation actuarial liability.
    •   An increase of $5,722, or 29%, in Other Postemployment Benefits (OPEB) expense of $25,219.
  •   Total services and supplies increased by $9,263, or 6.3%, to $157,431 across all functions and is primarily made up of the following:
    •   An increase in payments to community based organizations of $4,855, or 16%, to $35,496.
    •   An increase in pharmaceutical costs of $2,078, or 53%, to $6,010.
    •   An increase in structure and ground maintenance costs of $2,470, or 76%, to $5,700.

Unaudited and in thousands

19

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

$350,000 $280,000 $210,000 $140,000

$70,000 $0

Program Expenses and Revenues ‐ Governmental Activities

Expenses Program Revenues

Policy & Executive

Public Safety

Health & Public Assistance

Comm. Res. & Public Facilities

General Gov’t & Support Services

General County Programs

Analysis of Business‐type Activities

The net position of business‐type activities decreased by 8%, or $7,703, to $88,050 which indicates these activities generated revenues sufficient to cover the costs of operations. (See discussion on Proprietary Funds in the next section.)

This decrease in net position is mainly a result of the recognition of the unfunded pension liability by Laguna Sanitation and Resource Recovery.

Charges for Services 94%

Investment Earnings 0%

Other 6%

Revenues by Source Business‐type Activities

$32,000 $24,000 $16,000

$8,000 $0

Program Expenses and Revenues Business‐type Activities

Resource Recovery

Laguna Sanitation

Expenses Program Revenues

Unaudited and in thousands

20

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Financial Analysis of the County’s Fund Balances

As noted earlier, the County uses fund accounting to demonstrate compliance with finance‐related legal requirements.

Governmental Funds

The focus of the County’s governmental funds is to provide information on near‐term inflows, outflows, and balances of spendable resources (modified accrual basis of accounting). Such information is useful in assessing the County’s financing requirements. In particular, total fund balance less the nonspendable portion is a useful measure of a government’s resources available for spending at the end of the fiscal year.

At June 30, 2015, the County’s Governmental Funds reported total fund balances of $281,044, a $17,796 increase in comparison with the prior year’s total ending fund balances. The components of total fund balance are as follows (for more information see Note 18 – Fund Balances):

 Nonspendable Fund Balance, $12,171, are amounts that are not spendable in form, or are legally or contractually required to be maintained intact, and are made up of (1) legally required Teeter Tax program loss reserves of $7,442, (2) long‐term receivables of $4,673, and (3) prepaid expenses and deposits of $56.

 Restricted Fund Balance, $185,102, consists of amounts with constraints put on their use by

creditors, grantors, contributors, laws, regulations or enabling legislation. Examples of restrictions on funds are those for (1) purpose of fund (i.e., flood control), (2) grants for capital outlay, and (3) legislated amounts reserved for health care.

 Committed Fund Balance, $80,529, consists of amounts for specific purposes determined by the Board of Supervisors, such as Strategic Reserve account of $29,555 and Northern Branch Jail Operations account of $7,900.

 Unassigned Fund Balance, $3,242, represents the residual classification for the County’s General Fund.

Approximately 96%, or $268,873, of the total fund balances is spendable which means it is available to meet the County’s current and future needs. With the approval of the Board of Supervisors, County management can earmark a portion of fund balance to a particular function, project or activity, and can also earmark it for purposes beyond the current year, within the constraints applied to the various categories of fund balance. With the exception of the nonspendable portion, fund balances are available for appropriation at any time.

Fund Balances

Nonspendable

General Fund $ 11,042

Major Funds

Roads ‐

Restricted Committed

22,946 $ 61,887

21,421 ‐ 20,016 5,445 2,695 1,265 8,148 ‐ 67,736 ‐ 6,055 ‐ 10,094 ‐ 2,112 9,430

23,879 2,502 185,102 $ 80,529

Unassigned

Public Health
Social Services
Alcohol Drug & Mental Health Flood Control
Affordable Housing
Fire Projection
Capital Projects

Other Governmental Funds Total Fund Balances

‐ ‐ ‐

52 ‐ 1,039 ‐

3,242 $

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

38 12,171 $

26,419

$

$

Total

99,117

21,421 25,461 3,960 8,148 67,788 6,055 11,133 11,542


3,242 $ 281,044

$

$

Unaudited and in thousands

21

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

General Fund

The General Fund is the main operating fund of the County. The General Fund’s total fund balance increased by 7%, or $6,311, to $99,117 at June 30, 2015.

The spendable portion of fund balance increased $5,407 to $88,075 due to positive operating results. The nonspendable portion of fund balance increased $904 to $11,042 due to additional property tax impounds related to oil property assessment appeals.

As a measure of the General Fund’s liquidity, it is useful to compare both total fund balance and spendable fund balance to total fund expenditures. Total fund balance equates to 31% of total General Fund expenditures while spendable fund balance equates to 27% of total General Fund expenditures. Of the General Fund spendable fund balance, $22,946, or 26% is restricted, and $61,887, or 70%, is committed.

Some significant program committed amounts are:

  •   $29,555 strategic reserve earmarked for severe economic downturns and emergencies,
  •   $7,900 in New Jail Operations,
  •   $3,541 in Program Restoration,
  •   $3,393 for Contingencies, and
  •   $2,000 for a Mental Health.

    General Fund unassigned fund balance at year‐end was $3,242, a 5%, or $163, decrease from the prior year.

    Major Funds

    As compared with the prior year, the total fund balances of the major funds increased 10%, or $13,588, to $155,508 with the following significant changes:

  •   The Roads fund for operations, maintenance, and infrastructure incurred expenditures of $33,600 and finished the year with a $169 decrease in fund balance to $21,421. The fund balance is mainly due to carryover of project funds to the following year.
  •   The $67,871 Public Health operation balanced its budget this year and increased fund balance in the amount of $2,552 to $25,461 mainly due to higher revenues than anticipated.
  •   The Federal and State funded Social Services safety net programs are among the largest in the County with expenditures of $151,996. This year the department increased fund balances by a net of $508 to $3,960.

 The ADMHS fund, with expenditures of $92,060, finished the year with an increase to fund balance of $796 to $8,148.

 The Flood Control District with expenditures of $9,682 increased its fund balance by $5,312 to $67,788 mainly due to project funds carrying over to the following year.

 The Affordable Housing Fund finished the year with a fund balance to $6,055.

 The Fire Protection District Fund, with expenditures of $58,054, finished positive with an increase to fund balance of $2,894 to $11,133 due to positive operating results.

 The Capital Projects Fund increased by $450 to $11,542 due to increased General Fund contributions for planned capital projects.

Other Governmental Funds

The fund balances of nonmajor governmental funds as a whole decreased by $2,103 to $26,419. The significant changes occurred in the following funds:

  •   The Santa Barbara County Finance Corporation’s fund balance decreased by $1,567 to $1,319 due to a reserve release related to a debt refinancing.
  •   The In‐Home Supportive Services’ (IHSS) fund balance decreased by $1,059 due to a planned draw down to fund a portion of annual IHSS operations.

    Proprietary Funds

    The County’s proprietary funds provide the same type of information found in the Governmentwide Financial Statements, but in more detail.

    Total Enterprise Funds Net Positions, which at year‐end were comprised of the Resource Recovery Fund and the Laguna Sanitation Fund, increased by $2,963, or 3.1%, from the prior year. Resource Recovery Fund net position decreased by $2,077, and Laguna Sanitation Fund net position increased by $5,040. Revenues increased $906, or 3%, to $34,253. Non‐operating revenues (expenses) decreased a net $172. Operating revenue generated by the Resource Recovery Fund decreased $256, and Laguna Sanitation user fee revenue increased $1,162. Resource Recovery expenses increased $5,804 and Laguna Sanitation expenses increased $101.

    Total internal service funds net position increased by $1,862, or 4%, to $45,458. The Risk Management and

Unaudited and in thousands

22

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Insurance Fund’s net position decreased $1,236, or 41%, to $1,778. This is due a reduction in self‐insurance actuarial liabilities and pension liabilities.

The remaining internal service funds experienced the following changes: the Information Technology Services Fund increased net position by $701, the

Vehicle Operations and Maintenance Fund had an increase in net position of $1,693, the Utilities Fund had an increase in net position of $117, and the Communications Services Fund had an increase in net position of $587.

Capital Assets & Debt

Capital Assets

Capital Assets (net of depreciation, in thousands)

Governmental Activities 2014 2015

$ 54,699 47,316 56,383 33,907 192,305

11,756 210,863 51,312 198,671

472,602 $ 664,907

Business‐type Activities

2014 2015 2014

Total

Total Percent

2015

Dollar Change

Change

Land
Land easements Work in progress SCA assets

Capital assets, not being depreciated

Land improvements Structures and improvements Equipment and software
In frastructure

Capital assets, net of accumulated depreciation

Total

$ 54,699 47,320 48,818 36,550

$ 13,176 — 2,797 —

$ 13,176 — 616 —

$ 67,875 47,316 59,180 33,907

$ 67,875 47,320 49,434 36,550

$ — 0% 4 0% (9,746) (16%) 2,643 8% (7,099) (3%)

5,234 43% (51,410) (24%) 9,285 14% 56,609 23%

19,718 4% $ 12,619 2%

187,387

15,973

13,792

208,278

201,179

17,001 159,745 60,762 250,663

304 6,451 14,900 47,128

293 6,159 14,735 51,745

12,060 217,314 66,212 245,799

17,294 165,904 75,497 302,408

488,171

68,783

72,932

561,103

$ 675,558

$ 84,756

$ 86,724

541,385

$ 749,663

$762,282

During the fiscal year, the County’s investment in capital assets increased by $12,619, or 2%, to $762,282 (net of accumulated depreciation/amortization). This investment is in a broad range of capital assets including land, land easements, work in progress

  •   General Government & Support Services – Santa Barbara Court House HVAC ($1,213), Mural Room at the Santa Barbara Courthouse ($533), Probation Remodel ($197), Phase 1 of the Aumentum Property Tax and Cashier System ($6,500).
  •   Community Resources & Public Facilities – Jonata Park Bridge ($3,846), Black Road Bridge Rehab. ($4,137), Cachuma Sewer Plant ($407).
  •   Public Safety – Sheriff Helicopter Refurbishment ($1,888).

    As a result of Governmental Accounting Standards

    Board (GASB) reporting requirements, the County recorded $36,550 in capital assets for improvements made to County property by operators of County service concession arrangements (SCAs). A related deferred inflow of resources was also recorded and is being amortized over the life of the existing SCA contracts. See Notes 8 and 17 of the Notes to the Financial Statements for more information on capital assets and deferred inflows of resources related to SCAs.

    During the year, the County capitalized $22,228 in equipment and software purchases, and also recorded

(WIP), land improvements, infrastructure.

improvements, structures and equipment and software, and

The County both purchases and constructs capital assets throughout the year. When a capital project will be completed in a subsequent fiscal year, related expenditures are recorded as WIP. In the year of completion, a project’s WIP is allocated to the appropriate capital asset classification(s). In the current fiscal year, WIP had a net decrease of $7,565 for governmental activities and decrease of $2,181 for business‐type activities, as WIP expenditures of $28,076 were offset by project completions/disposals of $35,641 for governmental funds.

The County completed and capitalized projects costing

approximately $26,772. completed were as follows:

Some major

projects

Unaudited and in thousands

23

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

depreciation/amortization of $25,803 against its capital assets. Capital asset disposals for the fiscal year totaled $1,131, net of accumulated depreciation.

Additional capital asset information, including depreciation, amortization, and outstanding CIP by project as of June 30, 2015, can be found in Note 7 of the Notes to the Financial Statements.

Debt

Outstanding Debt (in thousands)

Governmental Activities

2014 2015

$ 3,013 41,414 17,070 $ 61,497

Business‐type Activities

2014 2015 2014

Total

Dollar Change

Total

Percent Change

2015

Capital lease obligations Certificates of participation Bonds and notes payable

Total

$ 2,686 29,550 23,580

$ — 6,781 8,203

$ — 6,061 7,462

$ 3,013 48,195 25,273

$ 2,686 35,611 31,042

$ (327) (11%) (12,584) (26%) 5,769 23% $ (7,142) (9%)

$ 55,816

$ 14,984

$ 13,523

$ 76,481

$ 69,339

At June 30, 2015, the County had total long‐term debt outstanding of $69,339. This amount was comprised of $35,611 of certificates of participation (COP) issued by the County Finance Corporation, and secured by the County’s lease rental payments with a covenant to budget and appropriate lease payments. It also includes $31,042 of bonds and notes payable and $2,686 of capital lease obligations.

The County’s total long‐term debt decreased by $7,142, or 9%, during the fiscal year. The net decrease was due to the following: (1) ‐$327 of payments for capital lease obligations, (2) ‐$1,504 of payments for COP Debt and a ‐$11,080 defeasance of COP debt (net decrease of ‐$12,584), and (3) ‐$4,156 of payments for bonds and notes payable as well as a bond issuance of $9,925 (net increase of $5,769). The bond issuance of $9,925 was used to refund the defeasance of $11,080 of COP debt.

The County maintains a Standard & Poor’s ‘SP-1+’ rating for short-term notes and both a Standard & Poor’s ‘AA+’ and a Moody’s ‘A1’ for long-term certificates of participation.

Standard & Poor’s, in its June 12, 2013 credit profile, assigned an ‘AA+’ rating to the County’s appropriation debt.

The rationale behind the rating reflects the rating agency’s view of:

 The long–term general creditworthiness of the County;

 The County’s covenant to budget and appropriate debt payments; and

 Rental interruption insurance that covers sublease payments to offset risk to the bondholders.

The ‘AA+’ rating is based on the following long‐term strengths of the County:

 A stable, moderately growing economic base with access to the broader Ventura and Los Angeles area economies;

 Consistent maintenance of very strong unreserved General Fund balances despite limited financial flexibility due to state mandates;

 An experienced management team that has implemented strong financial policies and prudent expenditure controls; and

 Low overall debt levels.

Standard & Poor’s, in its May 29, 2013 rating of the County’s fiscal year (FY) 13‐14 $35,000 Tax and Revenue Anticipation Notes (TRAN), states that the ‘SP‐1+’ rating reflects their view of “the County’s very strong underlying general credit characteristics; strong county‐projected note repayment coverage of 1.78x at maturity; and very strong county‐projected coverage of 3.21x at maturity…”

Additional information on the County’s long‐term debt can be found in Notes 10 through 13 in the Notes to the Financial Statements.

Unaudited and in thousands

24

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Deferred Outflows of Resources & Deferred Inflows of Resources

Deferred Outflows of Resources

Deferred outflows of resources are new to the County’s Statement of Net Position for this fiscal year. This classification balance, although similar to “assets,” is set apart because these items do not meet the technical definition of being a County asset on the date of these financial statements. In other words, these amounts are not available to pay liabilities in the way assets are available. When all the recognition criteria are met, the deferred outflow of resources will become an expense/expenditure.

The most significant deferred outflow of resources reported are related to the implementation of GASB Statement No. 68 and GASB Statement No. 71 for pension liability reporting. GASB 71 requires that contributions made during the fiscal year to the retirement system be reported as deferred outflows of resources. Consequently, the majority of the deferred outflows of resources reported are comprised of current year contributions to the retirement system. However, there may be some deferred outflows of resources attributable to the various components that impact pension changes, and can include investment changes amortization, changes due to actuarial assumptions, and differences between expected or actual experience.

Deferred Inflows of Resources

Deferred inflows of resources are the counterpart to deferred outflows of resources on the Statement of Net Position. Deferred inflows of resources are not technically liabilities of the County as of the date of the financial statements. When all the recognition criteria are met, the deferred inflow of resources will become revenue or an increase to net position.

There are several different types of deferred inflows of resources being reported on the County’s Statement of Net Position, which include pensions, housing loans, and service concession arrangements.

 Deferred inflows of resources related to pensions represent a net amount attributable to the various components that impact pension changes, and can include investment changes amortization, changes due to actuarial assumptions, and differences between expected or actual experience.

  •   Deferred inflows of resources related to housing loans represent expected future proceeds when (forgivable) loan principal and interest due to the County is repaid. The amounts for deferred inflows of resources for the housing loans are the same as prior year (the County chose to report the prior year balances because of the low repayment activity from payments and payoffs occurring during the fiscal year and because staff turnover caused a delay in updating such repayment activity accordingly).
  •   Deferred inflows of resources related to service concession arrangements (SCAs) reflect expected future proceeds from revenue‐sharing agreements with organizations that operate County‐owned facilities. The change from prior year to current year represents installment payments received from the concession arrangements, and for the amortization of SCA capital asset improvements.

    See Note 17 for more information on deferred outflows of resources and deferred inflows of resources.

Unaudited and in thousands

25

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

General Fund Budgetary Highlights

The County’s final budget appropriations for expenditures for the General Fund differ from the original budget by supplemental appropriations of $5,417, or 2%. The major changes in appropriations are as follows:

  •   Salaries and benefits increased $1,078 due to additional appropriations for overtime in the Sheriff’s department.
  •   Services, supplies and other charges increased $3,189 made up primarily of increased professional service costs, special project costs and capital type projects generally related to activities in Planning and Development, Parks and General Services departments.
  •   Capital asset appropriations increased $1,149. This increase is mostly due to additional appropriations for equipment and software in the Sheriff department.

    Revenues: General Fund revenues were $26 less than total adjusted budget revenue estimates.

  •   Tax revenues outperformed revenue estimates by a $3,823, or 1.9%, primarily due to better than expected estimates for Property Tax, Transient Occupancy Tax, and Sales Tax growth.
  •   Licenses, permits, and franchise revenues had a negative $1,259 variance from revenue estimates due less than anticipated revenue for land uses, building, and energy permits.
  •   Fines, forfeitures, and penalties revenue was $783 more due to higher than estimated penalty collections associated with delinquent property tax payments.
  •   Interest earnings were lower than budget estimates by $489 due to investment returns that were less than estimated.
  •   Intergovernmental revenues were less than budgeted estimates by $1,729 due primarily to the County recording less revenue than anticipated from a reimbursement by the State of SB 90 revenues. The ADMHS department determined it had claimed a portion of the reimbursement as a claim against another grant and that portion of the reimbursement was recorded as unearned revenue and will be returned to the State.

 Charges for services were less than revenue estimates by $1,039 primarily due to lower than expected environmental resource services reimbursements in the Planning department.

Expenditures: The variance between the final budget and actual expenditures resulted in $11,052 of unspent appropriations. Key variances are as follows: salary and benefit cost savings of approximately $4,975 resulting from unfilled positions; $5,281 resulting from unspent appropriations for services, supplies, and other charges across all functions; and $795 resulting from capital assets budgeted, but not procured in this fiscal cycle.

By year‐end, appropriation savings offset by unrealized revenues reduced the budget plan to draw upon fund balance: the General Fund’s equity position increased $6,311, versus the adjusted budget plan to draw on fund equity by ‐$5,503.

The General Fund Budget to Actual schedule can be found on page 113 of this report.

$400,000 $300,000 $200,000 $100,000

$0

General Fund
Budget to Actual Comparison

Original Budget

Final Budget

Actual

Expenditure Revenue

$9,000 $6,000 $3,000

$0 -$3,000 -$6,000 -$9,000

General Fund Budgeted Effect on Fund Balance

Final Budget

Original Budget

Actual

Unaudited and in thousands

26

Management’s Discussion and Analysis

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Economic Factors and Next Year’s Budget and Rates

The following factors were considered in preparing the County’s operating budget for fiscal year (FY) 2015‐16:

The budget is projecting a continued moderate and sustainable growth in County revenues. For budget year FY 15‐16 local taxes are estimated to continue to improve in the following ranges: Property Taxes 4‐6%, Transient Occupancy taxes 4‐6%, and Retail Sales taxes 4‐6%. The adopted budget estimates are on the conservative side of the range.

Total Governmental Fund revenues showed an increase of 5%, or $34,300, comparing FY 15‐16 budget to FY 14‐15 actual revenues. Although the FY 2015‐16 budget shows an increase in General Fund general revenues of 1%, or $3,619, compared to FY 14‐15 actual revenues, the prior year included a one‐time receipt of funds. SB 90 State mandate reimbursements years dating back prior to FY 04‐05 were received in the amount of $5,172 and $1,190 in interest. If adjusted, the estimate for County General Fund general revenues increases 3%, or $9,982.

The budget appropriations for total Governmental Fund expenditures for FY 15‐16 includes an 11%, or $493 million, increase when compared to FY 14‐15 actual and

Requests for Information

This financial report is designed to provide a general overview of the County’s finances for all interested parties. Questions concerning any of the information provided in this report or requests for additional information should be addressed to Santa Barbara

only 3%, or $2,344, when compared to the prior year adjusted budget. The budget includes funding for a moderate amount of new positions, and moderate increases for salary COLA’s, employee benefits and a small reduction in retirement contribution rates.

The State again adopted an on‐time budget and its financial condition continues to improve. The improving condition of State finances is helping the County’s own effort to sustain its local budget. The Affordable Care Act is also affecting State and Federal County Health and Human Services program funding.

As of June 30, 2015, the available spendable General Fund balance was $88,075. Of this amount, $22,946 was Restricted and $61,887 was Committed but remains available for appropriation. The County’s General Fund ended with $3,242 of Unassigned fund balance at June 30, 2015. The County’s Recommended performance‐based FY 15‐17 budget and the County’s Five Year Capital Improvement Program can be found

under the

Budget

County Auditor‐Controller, PO Box 39, Santa Barbara, CA 93102‐0039. The County’s Comprehensive Annual Financial Report and Financial Highlights publications can also be found on the County’s website at http://cosb.countyofsb.org/auditor/default.aspx?id=1234.

Unaudited and in thousands

27

28

BASIC FINANCIAL STATEMENTS

29

COUNTY OF SANTA BARBARA, CALIFORNIA STATEMENT OF NET POSITION GOVERNMENTWIDE
June 30, 2015 (in thousands)

Assets

Governmental Activities

Business‐type Activities

35,657 $

— 231 — 109 36 2,343 325

(2,228) 262 — — 23 19,107 — — 13,792 72,932 142,589

— 2,069 2,069

821 647 37 — — — 232

595 — 717 757 — 439

77 — 5,344 — 6,705 — — 26,355 1,915 9,808 54,449

— 2,159 2,159

73,988

— — — — —

14,062 88,050 $

Total

342,879

26,345 725 318 2,032 44,580 21,806 1,593 — 520 50 14,220 6,190 38,721 38,788 5,878 201,179 561,103 1,306,927

514 117,156 117,670

20,567 32,842 275 5,767 21,419 1,582 8,210

28,549 345 1,600 3,647 7,047 439

3,625

2,341 34,011 2,740 27,395 17,195 203 26,355 91,693 565,460 903,307

33,096 3,948 122,243 159,287

662,977

28,640

37,477 152,739 4,960 12,736

(537,526) 362,003

Cash and investments (Note 4) $ 307,222 Accounts receivable, net:

Taxes 26,345 Licenses, permits, and franchises 494 Fines, forfeitures, and penalties 318 Use of money and property 1,923 Intergovernmental 44,544 Charges for services 19,463 Other 1,268

Internal balances 2,228 Inventories 258 Prepaid items 50 Notes receivable 14,220 Other receivables 6,167 Restricted cash and investments (Note 5) 19,614 Housing loans receivable (Note 6) 38,788 Housing loans interest receivable (Note 6) 5,878 Capital assets, not being depreciated/amortized (Note 7) 187,387 Capital assets, net of accumulated depreciation/amortization (Note 7) 488,171

Total assets 1,164,338 Deferred outflows of resources (Note 17)

$

Deferred social services Deferred pensions

Total deferred outflows of resources

Liabilities

Accounts payable
Salaries and benefits payable
Interest payable
Other payables
Advances from grantors and third parties (Note 9) Unearned revenue
Customer deposits payable
Long‐term liabilities (Note 10):

Portion due within one year:
Compensated absences (Note 10)
Capital lease obligations (Note 11)
Certificates of participation, net (Note 12) Bonds and notes payable (Note 13)
Liability for self‐insurance claims (Note 14) Landfill closure/postclosure care costs (Note 16)

Portion due in more than one year:
Compensated absences (Note 10)
Capital lease obligations (Note 11)
Certificates of participation, net (Note 12)
Other long‐term obligations (Note 10)
Bonds and notes payable (Note 13)
Liability for self‐insurance claims (Note 14)
Estimated litigation liability (Note 14)
Landfill closure/postclosure care costs (Note 16)
Other postemployment benefits (OPEB) obligation (Note 22) Net pension liability (Note 21)

Total liabilities

Deferred inflows of resources (Note 17)

Deferred service concession arrangements Deferred housing loan payments
Deferred pensions

Total deferred inflows of resources

Net position

Net investment in capital assets Restricted for (Note 19):

Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs

Unrestricted
Total net position $

514 115,087 115,601

19,746 32,195 238 5,767 21,419 1,582 7,978

27,954 345 883 2,890 7,047 —

3,548

2,341 28,667 2,740 20,690 17,195 203 — 89,778 555,652 848,858

33,096 3,948 120,084 157,128

588,989

28,640

37,477 152,739 4,960 12,736

(551,588) 273,953

$

The notes to the financial statements are an integral part of this statement.

30

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF ACTIVITIES
GOVERNMENTWIDE
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Functions/Programs

Governmental activities: Policy & executive
Public safety
Health & public assistance Community resources &

public facilities General government &

support services
General county programs Interest on long‐term debt

Total governmental activities

Business‐type activities: Resource Recovery Laguna Sanitation

Total business‐type activities Total primary government

Contributions Contributions

Total

(5,453) (161,121) (14,580)

(29,958)

(21,249) 12,059 (2,651)

(222,953)

(2,206) 4,926 2,720

(220,233)

180,498 8,768 8,550 3,933 150 3,301 982

6,538 9,374 1,207 2,470

432

501 7,026

42,631 1,915 220 278,496 58,263

915,720 (611,980) 303,740 362,003

Direct Expenses

Indirect Expenses

Total Expenses

Charges for Services

Capital Grants and

Governmental Activities

Business‐type Activities

Program Revenues Operating Grants and

Net (Expense) Revenue and Changes in Net Position

$

15,741 $ (5,020) 271,134 5,554 330,552 4,580

84,462 4,326

47,456 (9,690) 2,535 (73) 2,651 —

754,531 (323)

25,997 253 6,200 70 32,197 323

$

10,721 276,688 335,132

88,788

37,766 2,462 2,651

754,208

26,250 6,270 32,520 786,728

$

4,259 $ 1,009 44,118 71,449 86,215 234,337

27,537 31,249

13,577 2,940 8,885 5,636 — — 184,591 346,620

23,184 860 11,069 127 34,253 987

$ — — —

$

(5,453) (161,121) (14,580)

(29,958)

(21,249) 12,059 (2,651)

(222,953)

— — —

(222,953)

180,498 8,768 8,550 3,933 150 3,301 982

6,538 9,374 1,207 2,470

432

501 7,026

42,631 1,661 258 278,280 55,327

819,967 (601,341) 218,626 273,953

$

— $ —

— — — —

(2,206) 4,926 2,720 2,720

— — — — — — —

— — — — — — —

— 254

(38) 216 2,936

95,753 (10,639) 85,114

88,050 $

$

786,728 $

$

$

218,844

$

347,607

$

44

— — —

44

— — —

44

General Revenues: Taxes:

Property
Sales
Transient occupancy

Payments in lieu of taxes
Motor vehicle in‐lieu tax
Franchise fees
Other general revenues
Restricted for community resources and public facilities:

Sales tax, allocated to roads
Property tax, levied for flood control districts
Property tax, levied for county service areas
Property tax, levied for water agency
Property tax, levied for lighting districts
Property tax, levied for community facilities districts
Property tax, residual distribution from the redevelopment property tax trust fund

Restricted for public safety: Property tax, levied for fire district

Unrestricted investment earnings Gain (loss) on sale of capital assets

Total general revenues Change in net position

Net position ‐ beginning
Prior period adjustment (Note 24)

Net position ‐ beginning, as restated Net position ‐ ending

$

$

The notes to the financial statements are an integral part of this statement.

31

COUNTY OF SANTA BARBARA, CALIFORNIA BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2015 (in thousands)

Assets and deferred outflows of resources

Assets:
Cash and investments (Note 4) Accounts receivable, net:

General

Roads

22,184 $

— 12 — 25 3,216 2,209 8 435 — 38 — — — — 28,127

— 28,127 $

1,007 $ 777

410 4,317 — — 195 6,706

— — —

— 21,421 — — 21,421

28,127 $

Public Social Health Services

ADMHS

$ 64,698 Taxes 26,159

$

23,207 $ 254 $ 13,359

— — — — — — — — —

25 21 42 5,891 15,349 5,120 992 — 10,132 235 19 — — — 554 — — — — — 8 — — — — — — — — — — — — 30,350 15,643 29,215

— 514 — 30,350 $ 16,157 $ 29,215

978 $ 116 $ 10,694 3,092 4,878 2,589 190 6 7,557 — 6,189 227 — — — 258 1,008 — — — — 4,518 12,197 21,067

— — — 371 — — 371 — —

— — — 20,016 2,695 8,148 5,445 1,265 — — — — 25,461 3,960 8,148

30,350 $ 16,157 $ 29,215

Licenses, permits, and franchises 482 Fines, forfeitures, and penalties 13 Use of money and property 1,624 Intergovernmental 10,610 Charges for services 1,495 Other 279

Due from other funds (Note 20)
Prepaid items
Other receivables
Advances to other funds (Note 20) Restricted cash and investments (Note 5) Housing loans receivable

Housing loans interest receivable Total assets

Deferred outflows of resources: Deferred social services

Total assets and deferred outflows of resources

Liabilities, deferred inflows of resources, and fund balances

Liabilities:
Accounts payable
Salaries and benefits payable
Other payables
Advances from grantors and third parties (Note 9) Unearned revenue
Due to other funds (Note 20)
Customer deposits payable

Total liabilities

Deferred inflows of resources:
Deferred housing loan payments
Deferred miscellaneous unavailable revenue

Total deferred inflows of resources

Fund balances (Note 18): Nonspendable Restricted
Committed Unassigned

Total fund balances
Total liabilities, deferred inflows of resources, and fund balances

$

$

2,526 50 3,535 1,760 15,198 500 — 128,929

— 128,929

2,444 15,983 41 965 1,582 554 7,743 29,312

500 — 500

11,042 22,946 61,887

3,242 99,117

128,929

$

$

$

$

The notes to the financial statements are an integral part of this statement.

32

Flood
Control Affordable District Housing

  • $  69,356 $ 5,933

    — — — — — —

    71 6 450 634 — — — 554 — — — — 48 39 — — — 2,587 — 38,288 — 5,878 69,925 53,919

    — —

  • $  69,925 $ 53,919
  • $  510 $ 662 286 27 40 — 172 2,484 — — 1,129 525 — — 2,137 3,698

    — 44,166 — — — 44,166

    52 — 67,736 6,055 — — — — 67,788 6,055

  • $  69,925 $ 53,919

Fire Protection

Other Governmental Funds

Total Governmental Funds

Capital District Projects

$

9,739 $ 18,177

186 — — — — —

12 12 533 — 3,838 — — 4 — — — — 1,039 — — — — 604 — — — — 15,347 18,797

— — 15,347 $ 18,797

380 $ 866 3,241 — — 246 568 6,143 — — — — 25 — 4,214 7,255

— — — — — —

1,039 — 10,094 2,112 — 9,430 — — 11,133 11,542

15,347 $ 18,797

$

24,347 $

— 305 27 2,741 309 114 — — 38 — 1,215 — — 29,096

— 29,096 $

1,468 $ 797

2 354 — 41 15 2,677

— — —

38 23,879 2,502 — 26,419

29,096 $

251,254

26,345 494 318 1,865 44,544 18,975 1,213 3,515 50 4,745 1,760 19,604 38,788 5,878 419,348

514 419,862

19,125 31,670 8,492 21,419 1,582 3,515 7,978 93,781

44,666 371 45,037

12,171 185,102 80,529 3,242 281,044

419,862

Assets and deferred outflows of resources

Assets:
Cash and investments (Note 4) Accounts receivable, net:

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services
Other

Due from other funds (Note 20)
Prepaid items
Other receivables
Advances to other funds (Note 20) Restricted cash and investments (Note 5) Housing loans receivable

Housing loans interest receivable Total assets

Deferred outflows of resources: Deferred social services

Total assets and deferred outflows of resources

Liabilities, deferred inflows of resources, and fund balances

Liabilities:
Accounts payable
Salaries and benefits payable
Other payables
Advances from grantors and third parties (Note 9) Unearned revenue
Due to other funds (Note 20)
Customer deposits payable

Total liabilities

Deferred inflows of resources:
Deferred housing loan payments
Deferred miscellaneous unavailable revenue

Total deferred inflows of resources

Fund balances (Note 18): Nonspendable Restricted
Committed Unassigned

Total fund balances

Total liabilities, deferred inflows of resources, and fund balances

$

$

$

$

$

$

33

COUNTY OF SANTA BARBARA, CALIFORNIA BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2015 (in thousands)

Amounts reported for governmental activities in the Statement of Net Position are different because (Note 3): Total fund balances ‐ governmental funds

  1. (1)  Capital assets used in governmental activities are not current financial resources and, therefore, are not reported in the balance sheet.
  2. (2)  Note receivable for governmental activities from the RDA Successor Agency private‐purpose trust fund.
  3. (3)  Other receivable not due in the current period is not a current financial resource, therefore, it is not reported in the balance

    sheet.

  4. (4)  Deferred outflows of resources reported in the Statement of Net Position.
  5. (5)  Long‐term liabilities are not due and payable in the current period and, therefore, are not reported in the balance sheet.
  6. (6)  Accrued interest on long‐term debt.
  7. (7)  Other long‐term assets are not available to pay for current period expenditures and, therefore, are deferred in the

    governmental funds and recognized as revenue in the Statement of Activities.

  8. (8)  Deferred inflows of resources reported in the Statement of Net Position.
  9. (9)  Internal Service Funds are used by management to charge the costs of fleet management, information technology, risk

    management, communications, and utility services to individual funds. The assets and liabilities of the Internal Service

    Funds are included in the governmental activities in the Statement of Net Position.

  10. (10)  Adjustment for Internal Service Funds are necessary to “close” those funds by charging additional amounts to participating

    business‐type activities to completely cover the Internal Service Funds’ costs for the year. Net position of governmental activities (page 31)

The notes to the financial statements are an integral part of this statement.

$

281,044 647,725 14,220

660

113,400 (718,452) (238)

45,037 (155,369)

45,458 468 273,953

$

34

35

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

General

Total revenues 370,093

Expenditures

Current:
Policy & executive 15,563 Public safety 206,076 Health & public assistance 9,908 Community resources & public facilities 39,434 General government & support services 47,157 General county programs 3,090

Debt service:
Principal — Interest —

Roads

— 117 19,420 646 210 28,361

— — —

33,600 — —

— — —

33,600 (5,239) 4,997

(24) 97 —

5,070 (169)

21,590 21,421 $

Public Social Health Services

ADMHS

Revenues

Taxes
Licenses, permits, and franchises
Fines, forfeitures, and penalties
Use of money and property
Intergovernmental 77,900 Charges for services 61,626 Other 4,547

$

204,311 13,038 5,577 3,094

$

7,515 $ 453

— $ — $ — 42 80 — 656 5 3 111 200 164 19,985 144,380 48,232 41,380 — 32,514 4,018 905 463 66,192 145,570 81,376

— — —

— — — 67,871 151,996 92,060 — — — — — — — — —

— — — — — — — — —

67,871 151,996 92,060

Capital outlay
Total expenditures

Excess (deficiency) of revenues over (under) expenditures

Other financing sources (uses)

Transfers in (Note 20)
Transfers out (Note 20)
Proceeds from sale of capital assets Long‐term debt issued

Total other financing sources (uses) Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

— 321,228

48,865

6,990 (49,567)

23 — (42,554)

6,311

92,806 99,117

(1,679) (6,426)
7,062 7,146 12,459

(10,684)

(2,831) (212)
— — 1 — — —

4,231 6,934 11,480

2,552 508 796

22,909 3,452 7,352 25,461 $ 3,960 $ 8,148

(980)

$

$

The notes to the financial statements are an integral part of this statement.

36

Flood Control District

9,679 — — 318 1,223 3,573 39 14,832

— — —

9,682 — —

— — —

9,682 5,150 33

(37) 166 — 162

5,312

62,476 67,788

Affordable Housing

$ — — — 33 2,878 144 3,283 6,338

Fire Protection

Other Governmental Funds

4,698 27 3,340 810 22,329 5,351 3,152 39,707

— 16,256 21,749 6,922 127 100

15,318 2,516 — 62,988

(23,281)

14,228 (2,975) —

9,925 21,178

(2,103)

28,522 26,419

Total Governmental Funds

269,412 13,660 9,581 4,902 340,807 161,637 19,033 819,032

15,563 281,211 343,584

93,443 47,357 3,190

15,318 2,516 8,353

810,535

8,497

60,305 (61,278)

347 9,925 9,299

17,796

263,248 281,044

Capital District Projects

$

$

43,209 $ — 20 — — — 28 27 3,440 1,020 16,210 193 410 2,006 63,317 3,246

— — 58,054 825 — — — 65 — 73 — —

— — — — — 8,353

58,054 9,316 5,263 (6,070)

829 6,561 (3,258) (41)

60 — — — (2,369) 6,520

2,894 450

8,239 11,092 11,133 $ 11,542

$

$

Revenues

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services
Other

Total revenues

Expenditures

Current:
Policy & executive
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs

Debt service: Principal Interest

Capital outlay
Total expenditures

Excess (deficiency) of revenues over (under) expenditures

Other financing sources (uses)

Transfers in (Note 20)
Transfers out (Note 20)
Proceeds from sale of capital assets Long‐term debt issued

Total other financing sources (uses) Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

— — —

3,740 — —

— — —

3,740 2,598

— (1,353) —

— (1,353)

1,245

$

$

4,810 6,055 $

$

$

37

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Amounts reported for governmental activities in the Statement of Activities are different because:

Net change in fund balances ‐ governmental funds

Capital assets:

  1. (1)  The acquisition of capital assets uses current financial resources but has no effect on net position.
  2. (2)  The cost of capital assets is allocated over their estimated useful lives and reported as depreciation/amortization expense in

    the statement of activities.

  3. (3)  The proceeds from the sale of capital assets provide current financial resources but have no effect on net position.
  4. (4)  The net gain on the disposal of capital assets does not affect current financial resources but increases net position.

Long‐term debt:
(5) The issuance of long‐term debt provides current financial resources to the funds but has no effect on net position. (6) Principal payments on long‐term debt use current financial resources but have no effect on net position.

Measurement focus:
(7) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the

governmental funds.
(8) Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are

not reported as expenditures in governmental funds: Change in interest payable liability
Change in compensated absences liability
Change in estimated litigation liability

Change in accrued other postemployment benefits (OPEB) liability Change in accrued net pension liability
Amortization of bond premiums/discounts and issuance costs

Internal service funds:
(9) Internal service funds are used by management to charge the costs of information technology, fleet management, risk

management, communication services, and utilities to individual funds. The net revenue of internal service funds is reported within governmental activities.

Change in net position of governmental activities
The notes to the financial statements are an integral part of this statement.

$

17,796

24,594 (17,919)

(347) 165

(9,925) 15,318

427

97 (57) 592

(16,361) 39,104

(46)

1,889 55,327

$

38

39

COUNTY OF SANTA BARBARA, CALIFORNIA STATEMENT OF NET POSITION PROPRIETARY FUNDS
June 30, 2015 (in thousands)

Assets

Current assets:
Cash and investments (Note 4) Accounts receivable, net:

Licenses, permits, and franchises Use of money and property Intergovernmental
Charges for services

Other Inventories

Total current assets

Noncurrent assets:
Other receivables
Restricted cash and investments (Notes 4 & 5)
Capital assets, not being depreciated/amortized (Note 7)
Capital assets, net of accumulated depreciation/amortization (Note 7)

Total noncurrent assets Total assets

Deferred outflows of resources

Deferred pensions
Total deferred outflows of resources

Liabilities

Current liabilities:
Accounts payable
Salaries and benefits payable
Interest payable
Other payables
Customer deposits payable
Compensated absences (Note 10)
Certificates of participation payable (Note 12) Bonds and notes payable (Note 13)
Liability for self‐insurance claims (Note 14) Landfill closure/postclosure care costs (Note 16)

Total current liabilities

Noncurrent liabilities:
Compensated absences (Note 10)
Certificates of participation payable, net (Note 12) Bonds and notes payable (Note 13)
Liability for self‐insurance claims (Note 14) Landfill closure/postclosure care costs (Note 16) Advances payable (Note 20)
OPEB obligation (Note 22)
Net pension liability

Total noncurrent liabilities Total liabilities

Deferred inflows of resources

Deferred pensions
Total deferred inflows of resources

Net position

Net investment in capital assets Unrestricted

Total net position

Business‐type Activities ‐ Enterprise Funds

Governmental Activities‐ Internal Service Funds

$

Resource Laguna Recovery Sanitation

15,958 $ 19,699

231 — 89 20 36 —

1,692 651 325 — 234 28

18,565 20,398

— 23 18,983 124 9,512 4,280 45,446 27,486 73,941 31,913 92,506 52,311

1,681 388 1,681 388

676 145 516 131 9 28 — — 108 124 488 107 717 — — 757 — — 439 — 2,953 1,292

77 — 5,344 — — 6,705 — — 26,355 — 1,760 — 1,554 361 7,846 1,962 42,936 9,028 45,889 10,320

1,754 405 1,754 405

49,686 24,304 (3,142) 17,670 46,544 $ 41,974

$

Total

35,657

231 109 36 2,343 325 262 38,963

23 19,107 13,792 72,932 105,854 144,817

2,069 2,069

821 647 37 — 232 595 717 757 — 439 4,245

77 5,344 6,705 — 26,355 1,760 1,915 9,808 51,964 56,209

2,159 2,159

73,990 14,528 88,518

(468) 88,050

$

55,968

— 58 — 488 55 258 56,827

762 10 — 27,833 28,605 85,432

1,687 1,687

621 525 — 15 — 488 — 335 7,047 — 9,031

244 — 3,920 17,195 — — 1,635 7,877 30,871 39,902

1,759 1,759

23,578 21,880 45,458

$

$

Adjustment to reflect the allocation of the internal service funds’ cumulative net loss Net position of business‐type activities

$

The notes to the financial statements are an integral part of this statement.

40

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Business‐type Activities ‐

Enterprise Funds

Laguna Sanitation

11,017 — — 52 11,069

1,767 2,548 — 454 1,108 70 — 5,947

5,122

90 (292)

— — — —

120 (82)

5,040

— — —

5,040

39,033 (2,099) 36,934

Governmental Activities ‐ Internal Service Funds

Operating revenues

Charges for services
Sale of scrap and recyclables Self‐insurance recovery Other operating revenues

Total operating revenues

Operating expenses

Salaries and benefits
Services and supplies Self‐insurance claims Contractual services Depreciation and amortization County overhead allocation Closure/postclosure costs

Total operating expenses Operating income (loss)

Non‐operating revenues (expenses)

Use of money and property
Interest expense
Gain (loss) on sale of assets Contributions to other governments Settlements and damages

State and federal aid
Other non‐operating revenues

Total non‐operating revenues (expenses), net Income (loss) before transfers

Transfers in (Note 20) Transfers out (Note 20) Transfers in (out), net

Change in net position

Total net position ‐ beginning
Prior period adjustment (Note 24)

Total net position ‐ beginning, as restated Total net position ‐ ending

$

Resource Recovery

17,306 2,473 — 3,405 23,184

7,870 4,206 — 5,067 2,391 253 6,126 25,913

(2,729)

510 (233) (37) (53) (55)

57 463 652

(2,077)

— — —

(2,077)

57,161 (8,540) 48,621

46,544

$

$

Total

28,323 2,473 — 3,457 34,253

9,637 6,754 — 5,521 3,499 323 6,126 31,860

2,393

600 (525) (37) (53) (55)

57 583 570

2,963

— — —

2,963

96,194 (10,639) 85,555 88,518

2,963

(27) 2,936

$

51,024 — 1,086 203 52,313

7,733 29,097 8,940 631 4,384 1,617 — 52,402

(89)

385 (181) 101

— — —

673 978

889

1,060 (87)

973

1,862

52,169 (8,573) 43,596

45,458

$

$

41,974 $ $

$

$

Change in net position ‐ total enterprise funds
Adjustment to reflect the consolidation of internal service fund activities

related to enterprise funds
Change in net position of business‐type activities

The notes to the financial statements are an integral part of this statement.

41

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Cash flows from operating activities

Receipts from interfund services provided Receipts from self‐insurance recovery Receipts from customers and users Payments to employees

Payments to suppliers
Payments for self‐insurance claims
Payments for landfill closure/postclosure costs
County overhead allocation payments to the General Fund Other receipts

Net cash provided by operating activities

Cash flows from noncapital financing activities

Transfers from other funds Transfers to other funds
Payment on landfill settlement Contributions to other governments State and federal aid

Net cash provided (used) by noncapital financing activities

Cash flows from capital and related financing activities

Purchase of capital assets
Proceeds from sale of capital assets
Principal paid on certificates of participation Interest and fees paid on certificates of participation Principal paid on bonds and notes payable
Interest and fees paid on bonds and notes payable Federal interest subsidy on bonds payable

Net cash used by capital and related financing activities

Cash flows from investing activities

Use of money and property received
Net cash provided by investing activities

Net change in cash and cash equivalents

Cash and cash equivalents ‐ beginning Cash and cash equivalents ‐ ending

Reconciliation of cash and cash equivalents to the Statement of Net Position

Cash and investments per Statement of Net Position Restricted cash and investments per Statement of Net Position Total cash and cash equivalents per Statement of Net Position

Reconciliation of operating income (loss) to net cash provided by operating activities:
Operating income (loss)
Adjustments to reconcile operating income (loss) to net cash

provided by operating activities:
Depreciation and amortization
Other non‐operating revenue
Changes in assets, deferred inflows of resources, liabilities,

and deferred outflows of resources: Accounts and other receivables Inventories
Prepaid items

Accounts payable
Salaries and benefits payable Customer deposits
Liability for self‐insurance claims Landfill closure cost liability

Net cash provided by operating activities

Business‐type Activities ‐ Enterprise Funds

Governmental Activities ‐ Internal Service Funds

$

Resource Laguna Recovery Sanitation

— $ —

— — 23,126 11,394

(8,157) (1,800) (9,803) (3,107)

— — (128) — (253) (70)

463 17 5,248 6,434

— —

— — (55) — (53) —

57 — (51) —

(5,703) (665) 750 4 (695) — (258) —

— (741) — (294) — 103

(5,906) (1,593)

511 86 511 86

(198) 4,927

35,139 14,896 34,941 $ 19,823

15,958 $ 19,699 18,983 124 34,941 $ 19,823

(2,729) $ 5,122

2,391 1,108 463 17

(50) 326 34 — — —

(564) (105) (287) (33) (8) (1)

— — 5,998 — 5,248 $ 6,434

$

Total

— 34,520

(9,957) (12,910)

— (128) (323)

480 11,682

— (55) (53) 57 (51)

(6,368) 754

(695) (258) (741) (294) 103

(7,499)

597 597

4,729

50,035 54,764

35,657 19,107 54,764

2,393

3,499 480

276 34 —

(669) (320) (9)

— 5,998 11,682

$

51,475 1,086 —

(8,032) (29,887) (13,116)

— (1,617)

542 451

1,063 (87)

— — —

976

(7,023) 262 — —

(335) (181) 131

(7,146)

390 390

(5,329)

61,307 55,978

55,968 10 55,978

(89)

4,384 542

247 38 25

(221) (299)

— (4,176)

— 451

$

$ $

$

$

$ $

$

$

$ $

$

$

$

$

The notes to the financial statements are an integral part of this statement.

42

COUNTY OF SANTA BARBARA, CALIFORNIA STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS
June 30, 2015 (in thousands)

Assets

Investment Private‐purpose

Agency Funds

64,153 112 — 64,265

8,348 55,917 — 64,265

Trust Fund

Trust Fund

1,207 1 1,440 2,648

— 14,220 14,220

— (11,572) (11,572)

Cash and investments (Note 4) $ 695,146 $ Interest receivable 735 Restricted cash and investments (Note 5) —

Total assets 695,881

Liabilities

Accounts payable — Funds held as agent for others — Note payable —

Total liabilities —

Net position

Held in trust for:
External pool participants 695,881 Redevelopment agency dissolution —

Net position held in trust $ 695,881 $ The notes to the financial statements are an integral part of this statement.

$ $ $ $

43

COUNTY OF SANTA BARBARA, CALIFORNIA
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Additions

Contributions:
Contributions to pooled investments Redevelopment Agency Property Tax Trust Fund

Total contributions

Interest and investment revenue: Use of money and property

Total interest and investment revenue Total additions

Deductions

Benefits paid:
Distributions from pooled investments Affected taxing entities

Total benefits paid

Obligation retirements: Interest on note payable

Total obligation retirements

Administrative expenses:
County administrative expenses

Total administrative expenses Total deductions

Change in net position

Net position held in trust ‐ beginning Net position held in trust ‐ ending

The notes to the financial statements are an integral part of this statement.

$

Investment Trust Fund

4,746,867 — 4,746,867

2,393

2,393 4,749,260

4,676,996 — 4,676,996

— —

— —

4,676,996

72,264

623,617 695,881

Private‐purpose Trust Fund

$ — 1,370 1,370

$

$

19

19 1,389

— — —

642 642

42 42

684

705

(12,277) (11,572)

44

NOTES TO THE FINANCIAL STATEMENTS

45

Notes to the Financial Statements – Table of Contents

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Reporting Entity and Accounting Policies
Note 1 – Summary of Significant Accounting Policies ………………………………………………………………………………………..48

  •   The Reporting Entity…………………………………………………………………………………………………………………………48
  •   Blended Component Units ………………………………………………………………………………………………………………..48
  •   New Accounting Pronouncements …………………………………………………………………………………………………….51
  •   Financial Statements ………………………………………………………………………………………………………………………..51
  •   Measurement Focus, Basis of Accounting, and Financial Statement Presentation …………………………………52
  •   Cash and Investments ………………………………………………………………………………………………………………………55
  •   Accounts Receivable and Payable ……………………………………………………………………………………………………..55
  •   Deferred Outlflows and Inflows of Resources …………………………………………………………………………………….56
  •   Interfund Receivables and Payables …………………………………………………………………………………………………..56
  •   Inventories and Prepaid Items …………………………………………………………………………………………………………..56
  •   Capital Assets …………………………………………………………………………………………………………………………………..56
  •   Lease Obligations …………………………………………………………………………………………………………………………….57
  •   Long‐term Debt ……………………………………………………………………………………………………………………………….57
  •   Compensated Absences ……………………………………………………………………………………………………………………58
  •   Pensions ………………………………………………………………………………………………………………………………………….58
  •   Fund Equity ……………………………………………………………………………………………………………………………………..59
  •   Fund Balance Policy ………………………………………………………………………………………………………………………….59
  •   Strategic Reserve Policy ……………………………………………………………………………………………………………………60
  •   Use of Estimates ………………………………………………………………………………………………………………………………60
  •   Reclassifications……………………………………………………………………………………………………………………………….60
  •   Future Accounting Pronouncements …………………………………………………………………………………………………61

    Compliance and Reconciliation

    Note 2 – Budgetary and Legal Compliance……………………………………………………………………………………………………….61 Note 3 – Reconciliation of Governmentwide and Fund Financial Statements ……………………………………………………..62

    Detailed Notes on All Funds
    Note 4 – Cash and Investments ………………………………………………………………………………………………………………………64 Note 5 – Restricted Cash and Investments ………………………………………………………………………………………………………68 Note 6 – Receivables ……………………………………………………………………………………………………………………………………..69 Note 7 – Capital Assets …………………………………………………………………………………………………………………………………..69 Note 8 – Service Concession Arrangements (SCA) ……………………………………………………………………………………………74 Note 9 – Advances from Grantors and Third Parties …………………………………………………………………………………………77 Note 10 – Long‐term Liabilities………………………………………………………………………………………………………………………..78 Note 11 – Leases …………………………………………………………………………………………………………………………………………….80 Note 12 – Certificates of Participation (COP)…………………………………………………………………………………………………….81 Note 13 – Bonds and Notes Payable ………………………………………………………………………………………………………………..83 Note 14 – Self‐insurance …………………………………………………………………………………………………………………………………85 Note 15 – Commitments and Contingencies……………………………………………………………………………………………………..86 Note 16 – Landfill Closure and Postclosure ………………………………………………………………………………………………………88 Note 17 – Deferred Outflows and Inflows of Resources…………………………………………………………………………………….79 Note 18 – Fund Balances…………………………………………………………………………………………………………………………………92 Note 19 – Restricted Component of Net Position ……………………………………………………………………………………………..94 Note 20 – Interfund Transactions ……………………………………………………………………………………………………………………95

    Other Information
    Note 21 – Pensions …………………………………………………………………………………………………………………………………………98 Note 22 – Other Postemployment Benefits (OPEB)…………………………………………………………………………………………..104 Note 23 – Deferred Compensation Plans………………………………………………………………………………………………………….107 Note 24 – Prior Period Adjustment ………………………………………………………………………………………………………………….108

46

47

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Reporting Entity

The County of Santa Barbara (County), which was established by an act of the Legislature on February 18, 1850, is a legal subdivision of the State of California charged with governmental powers. The County’s powers are exercised through a five member Board of Supervisors (Board) which, as the governing body of the County, is responsible for the legislative and executive control of the County. As required by generally accepted accounting principles (GAAP) in the United States of America, the accompanying financial statements present the activities of the County (the primary government) and its component units. The component units discussed below are included in the County’s reporting entity because of the significance of their operational or financial relationships with the County.

Blended Component Units

While each of these component units is legally separate from the County, the County is financially accountable for these entities. Financial accountability is primarily demonstrated by the County’s Board acting as, or appointing, the governing board for each of the component units and its ability to impose its will. Because of their relationship with the County and the nature of their operations, component units are, in substance, part of the County’s operations and, accordingly, the activities of these component units are combined, or blended with the activities of the County for purposes of reporting in the accompanying basic financial statements.

Unless otherwise noted, additional detailed information and/or separately issued financial statements of the County’s component units can be obtained from the County Auditor‐Controller’s office located at 105 East Anapamu Street, Room 303, Santa Barbara, CA 93101.

Descriptions of the County’s blended component units are as follows:

Component Unit

Included in the Reporting Entity Because:

Separate Financial Statements

First 5 Children and Families Commission (Commission): established to promote, support, and improve the early development of children from prenatal stage to five years. Revenues consist primarily of funds generated by a state tax increase on cigarettes and tobacco products as mandated by Proposition 10.

1) Unit’s board is appointed by the Board and 2) County Management has operational responsibility

Available at the First 5 Children and Families Commission Office at 1306 Santa Barbara Street or at http://www.first5santabarbaracounty.org

County Service Areas: established to provide specific services to distinct geographical areas within the County. These services include street lighting, open space maintenance, library, community sewer sanitation and maintenance, and road maintenance. Revenues consist primarily of property taxes and benefit assessments.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

48

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

Public and Educational Access: established to receive grant revenue from the local cable television franchisee. The primary objectives and purposes of the fund are the support of educational and public information through programs aimed at expanding public access and educational access to telecommunication services.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Santa Barbara County Fire Protection District:

established to provide a full range of fire services to most of the unincorporated territory of Santa Barbara County; the cities of Buellton, Solvang and Goleta; and private lands within the National Forest. Revenues consist primarily of property taxes.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Flood Control and Water Conservation Districts:

established to control flood and storm waters and to conserve such waters for beneficial public use. Revenues consist primarily of property taxes and aid from other governmental units.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Lighting Districts: established to provide operation and maintenance of streetlights in certain areas of the County. Revenues consist primarily of property taxes and benefit assessments.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Laguna County Sanitation District: established to provide water and sewage treatment services to users. The costs of operating this district are charged to the users in the form of water charges and sewer fees.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Community Facilities Districts: established to allow for financing of public improvements and services. The services and improvements that can be financed include streets, sewer systems and other basic infrastructure, police protection, fire protection, ambulance services, schools, parks, libraries, museums, and other cultural facilities. Revenues consist primarily of Mello‐ Roos property taxes.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

49

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

Sandyland Seawall Maintenance District:

established to provide for maintenance of a seawall constructed in the Sandyland Cove area. Revenues consist primarily of benefit assessments levied against those properties adjacent to that beachfront area.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Water Agency (Agency): established to prepare investigations and reports on the County’s water requirements, project development, and importation of water from the State Water Project. The Agency provides technical assistance to County departments, water districts, and the public relative to ground water availability and water well locations and design. The Agency also administers the Cachuma Project and Twitchell Project contracts with the U.S. Bureau of Reclamation.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

In‐Home Supportive Services Public Authority (IHSS): established to act as the employer of record for IHSS individual providers. As an administrative unit, IHSS carries out functions prescribed in Welfare & Institutions Code Section 12301.6. Those functions include a provider screening process, a registry that will match eligible providers and consumers, and collective bargaining with providers and their representatives. IHSS also offers access to training for providers and consumers while continuing to allow for consumer choice in the selection of providers.

1) Unit’s board is the same as the Board and 2) County Management has operational responsibility

Not available

Santa Barbara County Finance Corporation:

established on July 28, 1983, this corporation is a nonprofit public benefit corporation and, in general, its purpose is to: purchase, lease or otherwise acquire real property; construct, install or acquire public improvements; operate, maintain, repair or improve real or personal property; and borrow money and become indebted for the purpose of acquiring and improving such property. The corporation facilitates financing for the County and other public entities.

1) Unit’s board is appointed by the Board and 2) County Management has operational responsibility

Not available

50

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

The accompanying financial statements include an Investment Trust Fund that holds assets of numerous self‐ governed school and special districts for which the County Treasurer acts as custodian. The financial reporting for these governmental entities, which are independent of the County, is limited to the total amount of cash and investments, and other assets, and the related fiduciary responsibility of the County for disbursement of these assets. The County Auditor‐Controller makes disbursements upon the request of the responsible school or special district officers. Activities of the school and special districts are administered by separate boards and are independent of the County Board. The Board has no effective authority to govern, manage, approve budgets, assume financial accountability, establish revenue limits, or to appropriate surplus funds available in these entities.

The accompanying financial statements also include a statutorily required Private‐Purpose Trust Fund for the Santa Barbara County Redevelopment Successor Agency (Successor Agency). The Successor Agency was created to serve, in a fiduciary capacity, as custodian for the assets and to wind down the affairs of the former Redevelopment Agency (RDA). The Successor Agency operates under the auspices of a legislatively formed oversight board who has authority over its financial affairs and supervises its operations and timely dissolution. Its assets are held in trust for the benefit of the taxing entities within the former RDA boundaries and as such are not available for County use.

New Accounting Pronouncements

The following Governmental Accounting Standards Board (GASB) Statements have been implemented in the current financial statements:

Statement No. 68

Statement No. 69

Statement No. 71

“Accounting and Financial Reporting for Pensions—an amendment of GASB Statement No. 27”

“Government Combinations and Disposals of Government Operations”

“Pension Transition for Contributions Made Subsequent to the Measurement Date ‐ an amendment of GASB Statement No.

The provisions of this statement are effective for financial statements for fiscal years beginning after June 15, 2014.

The provisions of this statement are effective for financial statements for periods beginning after December 15, 2013.

The provisions of this statement are effective for financial statements for fiscal years beginning after June 15, 2014.

Financial Statements

In accordance with GASB Statement No. 34, “Basic Financial Statements and Management’s Discussion and Analysis for State and Local Governments,” the financial statements consist of the following:

  •   Governmentwide financial statements,
  •   Fund financial statements, and
  •   Notes to the financial statements.

    The governmentwide financial statements consist of the Statement of Net Position and the Statement of Activities and report information on all of the nonfiduciary activities of the primary government and its component units. As a general rule, the effect of interfund intra‐function activity has been eliminated from the governmentwide financial statements. All internal balances in the Statement of Net Position have been eliminated, with the exception of those representing balances between the governmental activities and the

51

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

business‐type activities, which are presented as internal balances and eliminated in the total government column. The Statement of Activities presents function revenue and expenses of governmental activities and business‐type activities. 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. In the Statement of Activities, internal service funds’ revenue and expenses related to interfund services have been eliminated. Revenue and expenses related to services provided to external customers have not been eliminated and are presented within governmental activities.

The governmentwide financial statements distinguish functions of the County that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business‐type activities). The governmental activities of the County include policy and executive, public safety, health and public assistance, community resources and public facilities, general government and support services, and general county programs. The business‐type activities of the County include resource recovery and waste management and sanitation operations.

The Statement of Activities demonstrates the degree to which the direct and indirect expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Indirect expenses are allocated based on the annual Countywide Cost Allocation Plan which allocates the cost of central service departments to service user departments. Costs allocated in the Cost Allocation Plan include administrative and support costs such as budget preparation and oversight, county counsel, landscaping, payroll, utilities, and facilities maintenance. 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, including special assessments, that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items properly excluded from among program revenues are reported as general revenues.

Separate fund financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the governmentwide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.

Measurement Focus, Basis of Accounting, and Financial Statement Presentation

The governmentwide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary funds and fiduciary funds financial statements, with the exception of agency funds, which have no measurement focus. 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 have been met, except for the timing requirement.

Governmental funds financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. 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. The County, in general, considers revenues available if they are collected within 180 days after fiscal year‐end, except for property taxes, which the County considers available if they are collected within 60 days after fiscal year‐end. Grants, Medi‐Cal reimbursements and similar items are recognized as revenue as soon as all eligibility requirements have been met. Expenditures that meet accrual criteria are recorded when the related fund liability is incurred, except for unmatured interest on general

52

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

long‐term debt which is recognized when due, and certain compensated absences, and claims and judgments which are recognized when payment is due.
For the governmental funds financial statements, the County considers all revenues susceptible to accrual and recognizes revenue if the accrual criteria are met. Specifically, sales taxes, franchise taxes, licenses, interest, special assessments, charges for services and other miscellaneous revenue are all considered to be susceptible to accrual, and have been recognized as revenue in the current fiscal period. Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. All expenditure‐driven grants are recorded at the time of receipt or earlier. If qualifying expenditures have been incurred and all other eligibility requirements have been met, expenditure‐driven grants are recognized as revenue. When all eligibility requirements are met, except for the timing requirement, a deferred inflow of resources is reported until time requirements have passed.

The accounts of the County are organized on the basis of funds. A fund is an independent fiscal and accounting entity with a self‐balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance‐related legal and contractual provisions. The minimum number of funds is maintained, consistent with legal and managerial requirements.

The County reports the following major governmental funds:

  •   The General Fund is the County’s primary operating fund. It accounts for all the financial resources and the legally authorized activities of the County except those required to be accounted for in specialized funds.
  •   The Roads Fund is used to account for the planning, design, construction, maintenance and administration of County roads. It is also used to account for traffic safety and other transportation planning activities. Funding comes primarily from local sales and state highway user taxes, along with state and federal highway improvement grants.
  •   The Public Health Fund accounts for a variety of preventative health programs, outpatient services and inmate health programs. The fund is also used to account for Environmental Health and Emergency Medical Services. Revenue sources are primarily state and federal grants and vehicle license fees.
  •   The Social Services Fund accounts for a variety of public assistance and social service programs that are funded primarily from state and federal grants.
  •   The Alcohol, Drug, and Mental Health Services (ADMHS) Fund is used to account for mandated community health services under the California Mental Health Act including a mandated responsibility to “guarantee and protect public safety.” Revenue sources are primarily charges for services, sales tax revenue and state grants.
  •   The Flood Control District Fund is used to account for the provision of flood protection activities. Revenues come from a variety of sources including property taxes, charges for services, benefits assessments and federal grants.
  •   The Affordable Housing Fund is used to account for the various affordable housing programs administered by the County and provides local match to leverage federal funding for the creation of affordable housing. Prior to Fiscal Year 2013‐14, the affordable housing fund was classified as two separate nonmajor funds, the Affordable Housing Fund and the Redevelopment Successor Agency Housing Fund. These funds were combined for reporting clarity, as they both account for similar functions related to affordable housing.

53

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

  •   The Fire Protection District Fund is used to account for the finances of the Santa Barbara County Fire Department. The Fire Department utilizes property tax revenues, which are collected for public safety within the district’s boundaries. The Fire Department provides a full range of emergency services for most of the unincorporated territory of Santa Barbara County; the Cities of Buellton, Solvang, and Goleta; and private lands within the National Forest. The National Forest and military installations provide their own fire protection.
  •   The Capital Projects Fund is used to account for financial resources used in constructing major facilities.

The County reports the following major proprietary funds:

  •   The Resource Recovery and Waste Management Fund (Resource Recovery) accounts for the activities of refuse collection, disposal, landfill operations, and recycling programs.
  •   The Laguna County Sanitation District Fund (Laguna Sanitation) accounts for the activities of sewer collection and sewage treatment in the Orcutt area.

    Additionally, the County reports the following fund types:

    •   Internal Service Funds account for vehicle operations, risk management, information technology, communications operations, and utilities operations that provide services to other departments or agencies of the County, or to other governments, on a cost reimbursement basis.
    •   The Investment Trust Fund accounts for the external portion of the County Treasurer’s investment pool, which commingles resources of legally separate local governments within the County in an investment portfolio for the benefit of all participants. These entities include school and community college districts, other special districts governed by local boards, and regional boards and authorities. The County separately maintains these entities’ money in 364 individual funds; these funds represent the assets, primarily cash and investments, and the related liability of the County to disburse these monies on demand.
    •   The Private‐Purpose Trust Fund is a fiduciary fund type used by the County to report trust arrangements under which principal and income benefit other governments. This fund reports the assets, liabilities, and activities of the Santa Barbara County Redevelopment Successor Agency (Successor Agency).
    •   Agency Funds are custodial in nature and do not involve measurement of results of operations. Such funds have no equity accounts since all assets are due to individuals or entities at some future time. These funds (including Clearing and Revolving Funds, Deposit Funds, Other Agency Funds, State and City Revenue Funds, and Tax Collection Funds) account for assets held by the County in an agency capacity for individuals or other government units. The County reports on 276 different agency funds.

      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 Resource Recovery and Laguna Sanitation enterprise funds and of the County’s internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation/amortization on capital assets. All revenues and expenses not meeting this definition are reported as non‐operating revenues and expenses.

      Fiduciary funds include all Trust and Agency funds, which account for assets held by the County as a trustee, or as an agent for individuals or other government units.

54

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED Cash and Investments

The County’s cash and cash equivalents for Statement of Cash Flows purposes are considered to be cash on hand, demand deposits, restricted cash, and investments held by the County Treasurer in a cash management investment pool (Pool).

The Pool is not registered as an investment company with the Securities and Exchange Commission (SEC) nor is it an SEC Rule 2a7‐like pool. California Government Code statutes and the County Treasury Oversight Committee set forth the various investment policies that the County Treasurer must follow.

State statutes and the County’s investment policy authorize the County Treasurer to invest in U.S. Government Treasury and Agency Securities, bankers’ acceptances, commercial paper, corporate bonds and notes, repurchase agreements, and the State Treasurer’s Local Agency Investment Fund (LAIF). In accordance with GASB Statement No. 31, “Accounting and Financial Reporting for Certain Investments and External Investment Pools,” investments held by the County Treasurer are stated at fair value. The fair value of pooled investments is determined quarterly and is based on current market prices received from the securities custodian. The fair value of participants’ position in the pool is the same as the value of the pool shares. The method used to determine the value of participants’ equity withdrawn is based on the book value of the participants’ percentage participation at the date of such withdrawal. LAIF is required to invest in accordance with state statutes. The Local Investment Advisory Board (Advisory Board) has oversight responsibility for LAIF. The Advisory Board consists of five members as designated by state statute.

The Air Pollution Control District and the Santa Barbara County Association of Governments, as well as the public school districts, cemetery districts, fire protection districts, pest control districts, recreation and park districts, and resource conservation districts within the County are required by legal provisions to participate in the County’s investment pool. The deposits held for these districts are included in the Investment Trust Fund.

Accounts Receivable and Payable

The County only accrues revenues at fiscal year‐end and accrues only those revenues it deems collectible; as such, the County has no allowance for uncollectible accounts. The County expects to collect all accounts receivable within one year. County policy requires that all revenues and expenditures greater than $5 be accrued at fiscal year‐end, while revenues and expenditures under $5 may be accrued at fiscal year‐end at the discretion of individual departments.

The County levies, collects, and apportions property taxes for all taxing jurisdictions within the County including school and special districts. Article XIIIB of the State of California Constitution limits the property tax levy to support general government services of the various taxing jurisdictions to $1 per $100 of full cash value. Taxes levied to service voter‐approved debt are excluded from this limitation.

Secured property taxes are levied in September of each year based upon the assessed valuation as of the previous January 1 (lien date). They are payable in two equal installments due on November 1 and February 1 and are considered delinquent with penalties after December 10 and April 10, respectively. Unsecured property taxes are due on the January 1 lien date and become delinquent with penalties after August 31.

Since Fiscal Year (FY) 93‐94, the County has used an alternative property tax distribution method referred to as the “Teeter Plan.” This method allows for a 100% distribution of the current tax levy to entities electing the alternative method, as compared to the previous method where only the current levy less any delinquent taxes was distributed. This results in the General Fund receiving distributions of approximately 50‐55% in December, 40‐ 45% in April and the remaining 5% in June of each year. This method also provides that all of the delinquent

55

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

penalties and redemption penalties of the participating entity flow to the County’s General Fund. All County entities receiving property taxes were required by statute to participate. All delinquent taxes are recorded as accounts receivable in the General Fund. At June 30, 2015, property taxes receivable of $26,159 are recorded in the General Fund. In addition, the Teeter Plan requires that a property tax loss reserve be maintained in an amount equal to 1% of the current year’s secured tax levy, which is shown as a nonspendable portion of fund balance in the General Fund (see Note 18).

Deferred Outflows and Inflows of Resources

Pursuant to GASB Statement No. 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position,” and GASB Statement No. 65, “Items Previously Reported as Assets and Liabilities,” the County recognizes deferred outflows and inflows of resources.

In addition to assets, the Statement of Financial Position will sometimes report a separate section for deferred outflows of resources. A deferred outflow of resources is defined as a consumption of net position by the County that is applicable to a future reporting period. The County has two items which qualify for reporting in this category; refer to Note 17 for a detailed listing of the deferred outflows of resources the County has recognized.

In addition to liabilities, the Statement of Financial Position will sometimes report a separate section for deferred inflows of resources. A deferred inflow of resources is defined as an acquisition of net position by the County that is applicable to a future reporting period. The County has four items which qualify for reporting in this category; refer to Note 17 for a detailed listing of the deferred inflows of resources the County has recognized.

Interfund Receivables and Payables

Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as “advances to/from other funds” (i.e., the noncurrent portion of interfund loans). 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 governmentwide financial statements as “internal balances.” In the governmental funds financial statements, advances between funds are offset by a corresponding nonspendable portion of fund balance to indicate that they are not available for appropriation and are not expendable available financial resources.

Inventories and Prepaid Items

Inventories for both governmental and proprietary funds, consisting principally of materials and supplies held for consumption, are valued at cost, approximating market value, using the first‐in, first‐out (FIFO) method. The costs of governmental funds inventories are recorded as expenditures when consumed, rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the governmentwide and fund financial statements. The cost of prepaid items is recorded as expenditures/expenses when consumed rather than when purchased. The inventories and prepaid items recorded in the governmental funds do not reflect current appropriable resources and, thus, an equivalent portion of fund balance is reported as nonspendable.

Capital Assets

Capital assets include land, land improvements, structures and improvements (e.g., office buildings and building improvements), equipment (e.g., vehicles, machinery and computers), infrastructure (e.g., roads, bridges, sidewalks, and similar items), and intangible assets (e.g., land easements and computer software). Pursuant to GASB Statement No. 60, “Accounting and Financial Reporting for Service Concession Arrangements,” the County

56

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

also includes capital assets held by Service Concession Arrangements (SCA). They are reported in the applicable governmental or business‐type activities columns in the governmentwide financial statements, at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at the estimated fair market value at the date of donation.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. The capitalization thresholds are $5 for equipment and $100 for land improvements, buildings and improvements, infrastructure, and computer software.

Capital assets are depreciated/amortized using the straight‐line method over the following estimated useful lives:

Land improvements: Buildings & improvements: Equipment:

Infrastructure:

Intangible assets:

Parking lots, sidewalks, outdoor lighting, landscaping, drainage and irrigation systems

Office buildings Building improvements

Automobiles and light trucks Construction and maintenance vehicles General machinery and office equipment

Pavement and traffic signals Bridges
All other

Computer software

5 to 50 years

20 to 100 years 5 to 50 years

5 to 10 years 5 to 20 years 3 to 25 years

15 to 30 years 40 to 75 years 20 to 99 years

2 to 10 years

Outlays for capital assets and improvements are capitalized, as projects are constructed, in accordance with the County’s capitalization policy. Interest and indirect costs incurred during the construction phase of capital assets of proprietary funds are reflected in the capitalized value of the asset constructed. Depreciation/amortization expense is allocated to functions/programs and included as a direct expense in the Statement of Activities. Capital assets that are under construction or development and have not been completed are put into Construction in Progress and are presented as a capital asset not being depreciated on the Statement of Net Position.

Lease Obligations

The County leases various assets under both operating and capital lease agreements. In the governmentwide and proprietary funds financial statements, capital leases and the related lease obligations are reported as liabilities in the applicable governmental activities or proprietary funds Statement of Net Position.

Long‐term Debt

In the governmentwide and proprietary funds financial statements, long‐term debt and other long‐term obligations are reported as liabilities in the applicable governmental activities or proprietary funds Statement of Net Position. Bond premiums and discounts are amortized over the life of the bond and issuance costs are expensed in the year incurred.

In the governmental funds financial statements, bond premiums, discounts, and issuance costs are recognized in the period issued. Bond proceeds are reported as other financing sources net of the applicable premium or

57

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

discount. Issuance costs, even if withheld from the actual net proceeds received, are reported as debt service expenditures.

Interest is reported as an expenditure in the period in which the related payment is made. The matured portion of long‐term debt (i.e., portion that has come due for payment) is reported as a liability in the fund financial statement of the related fund.

Compensated Absences

County policy permits employees to accumulate earned but unused vacation, holiday and sick pay benefits. County policy states that unused sick leave shall not be cashed out at time of separation from service with the County; therefore, no liability for unpaid accumulated sick leave exists. Employees eligible for full retirement benefits, however, may convert their unused sick leave to up to one year’s service credit in determining their retirement benefits.

All vacation and holiday pay is accrued when incurred in the governmentwide and proprietary funds financial statements. In the governmental funds financial statements, a liability for these amounts is reported only if they have matured, for example, as a result of employee resignations or retirements prior to year‐end, and payment of the liability is made subsequent to year‐end. This is in accordance with GASB Interpretation No. 6, “Recognition and Measurement of Certain Liabilities and Expenditures in Governmental Fund Financial Statements.”

Pensions

In governmentwide financial statements, retirement plans (pensions) are required to be recognized and disclosed using the accrual basis of accounting (see Note 21 and the required supplementary information (RSI) section immediately following the Notes to Financial Statements), regardless of the amount recognized as pension expenditures on the governmental fund statements, which use the modified accrual basis of accounting.

In general, the County recognizes a net pension liability, which represents the County’s proportionate share of the excess of the total pension liability over the fiduciary net position of the pension reflected in the actuarial report provided by the Santa Barbara County Employees’ Retirement System (SBCERS). The net pension liability is measured as of the County’s prior fiscal year‐end. Changes in the net pension liability are recorded, in the period incurred, as pension expense or as deferred inflows of resources or deferred outflows of resources depending on the nature of the change. The changes in net pension liability that are recorded as deferred inflows of resources or deferred outflows of resources (that arise from changes in actuarial assumptions or other inputs and differences between expected or actual experience) are amortized over the weighted average remaining service life of all participants in the respective pension plan and are recorded as a component of pension expense beginning with the period in which they are incurred.

For purposes of measuring the net pension liability and deferred outflows/inflows or resources relating to pensions and pension expense, information about the fiduciary net position of the County’s pension plan with SBCERS and additions to/deductions from the plan’s fiduciary net position have been determined on the same basis as they are reported by SBCERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefits terms. Investments are reported at fair value.

Projected earnings on pension investments are recognized as a component of pension expense. Differences between projected and actual investment earnings are reported as deferred inflows of resources or deferred outflows of resources and amortized as a component of pension expense on a closed basis over a five‐year period

58

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

beginning with the period in which the difference occurred. Each subsequent year will incorporate an additional closed basis five‐year period of recognition.

Fund Equity

In the fund financial statements, in accordance with GASB Statement No. 54, “Fund Balance Reporting and Governmental Fund Type Definitions,” governmental funds report fund balance as nonspendable, restricted, committed, assigned or unassigned based primarily on the extent to which the County is bound to honor constraints on how specific amounts can be spent.

  •   Nonspendable fund balance – amounts that cannot be spent because they are either (a) not spendable in form; or (b) legally or contractually required to be maintained intact.
  •   Restricted fund balance – amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.
  •   Committed fund balance – amounts that can only be used for specific purposes determined by formal action of the County’s highest level of decision‐making authority (the Board of Supervisors) and that remain binding unless removed in the same manner. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period.
  •   Assigned fund balance – amounts that are constrained by the County’s intent to be used for specific purposes. The intent can be established at either the highest level of decision‐making authority, or by a body or an official designated for that purpose. This is also the classification for residual funds in the County’s special revenue funds. As a result of limitations imposed by the California County Budget Act, this classification is currently not used by the County.
  •   Unassigned fund balance – the residual classification for the County’s General Fund that includes amounts not contained in the other classifications. In other funds, the unassigned classification is used only if expenditures incurred for specific purposes exceed the amounts restricted, committed, or assigned to those purposes.

    The Board of Supervisors establishes, modifies or rescinds fund balance commitments and assignments by passage of an ordinance or resolution (ordinances and resolutions are considered of equal authority with respect to fund balance). This is done through adoption of the budget and subsequent budget amendments that occur throughout the year.

    When both restricted and unrestricted resources are available for use, it is the County’s policy to use Restricted fund balance resources first, followed by the unrestricted resources in the Committed and Unassigned fund balances, as they are needed.

    Fund Balance Policy

    The County believes that sound financial management principles require that sufficient funds be retained by the County to provide a stable financial base at all times. To retain this stable financial base, the County needs to maintain unrestricted fund balance in its County funds sufficient to fund cash flows of the County and to provide financial reserves for unanticipated expenditures and/or revenue shortfalls of an emergency nature. Committed and unassigned fund balances are considered unrestricted.

    The purpose of the County’s fund balance policy is to maintain a prudent level of financial resources to protect against reducing service levels or raising taxes and fees because of temporary revenue shortfalls or unpredicted one‐time expenditures.

59

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED

The County has adopted a policy to achieve and maintain unrestricted fund balance in the General Fund of 15% of operating revenue (approximately 60 days working capital) at the close of each fiscal year, consistent with the recommended level promulgated by the Government Finance Officers Association (GFOA).

Additional detailed information, along with the complete Fund Balance Policy, can be obtained from the County Auditor‐Controller’s office located at 105 East Anapamu Street, Room 303, Santa Barbara, CA 93101.

Strategic Reserve Policy

The County has established a separate committed fund balance account known as the Strategic Reserve. The target funding level for the Strategic Reserve is an amount equivalent to 8% of operating revenue (approximately 30 days working capital) for the General Fund. Funding for the Strategic Reserve is appropriated annually by the Board of Supervisors as part of the budget approval process.

The purpose of the County’s Strategic Reserve is to:

  1. Mitigate economic downturns that reduce County general revenue;
  2. Mitigate state or federal budget actions that may reduce County revenue;
  3. Maintain core service levels essential to public health, safety, and welfare;
  4. Front‐fund or completely fund, if necessary, disaster costs or costs associated with emergencies. Only those events that have been legally declared to be a disaster at the local, state or federal level are eligible for funding from the Strategic Reserve; and
  5. Absorb liability settlements in excess of available resources in the County’s committed litigation fund balance.

The monies in the Strategic Reserve are separate monies used only for the purposes stated above. The funds are used only to support the operating budget when general revenue increases less than 3% from the prior fiscal year. Any transfer of funds is approved by the Board of Supervisors and does not exceed the amount sufficient to balance the General Fund. Transfers require approval by 3/5 vote during budget hearings and 4/5 vote at all other times during the fiscal year in accordance with the County Budget Act.

As of June 30, 2015, the County’s Strategic Reserve fund balance was $29,556

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.

Reclassifications

Certain prior year balances may have been reclassified in order to conform to current year presentation. These reclassifications had no effect upon reported net position.

60

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ‐ CONTINUED Future Accounting Pronouncements

GASB Statements Nos. 72‐76 listed below will be implemented in future financial statements:

Statement No. 72 Statement No. 73

Statement No. 74

Statement No. 75

Statement No. 76

“Fair Value Measurement and Application”

“Accounting and Financial Reporting for Pension and Related Assets That Are Not within the Scope of GASB Statement No. 68, and Amendments to Certain Provision of GASB Statements No. 67 and No. 68”

“Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans”

“Accounting and Financial Reporting for Postemployment Benefits Other Than Pension Plans”

“The Hierarchy of Generally Accepted Accounting Principles for State and Local Governments”

The provisions of this statement are effective for financial statements for reporting periods beginning after June 15, 2015.

The provisions of this statement are effective for fiscal years beginning after June 15, 2015 ‐ except those provisions that address employers and governmental nonemployer contributing entites for pensions that are not within the scope of GASB Statement No. 68, which are effective for fiscal years beginning after June 15, 2016.

The provisions of this statement are effective for fiscal years beginning after June 15, 2016.

The provisions of this statement are effective for fiscal years beginning after June 15, 2017.

The provisions of this statement are effective for reporting periods beginning after June 15, 2015.

2. BUDGETARY AND LEGAL COMPLIANCE

The County is legally required to adopt an annual budget and adhere to the provisions of the California Government Code (Sections 29000 – 29144 and 30200), commonly known as the County Budget Act. Budgets are adopted for the general, special revenue, debt service and capital projects funds. Budgets are prepared on the modified accrual basis of accounting consistent with GAAP. The Board annually conducts a public hearing for the discussion of a proposed budget. At the conclusion of the hearings, statutorily no later than October 2, the Board adopts the final budget including revisions by resolution. However, it has been the County’s practice to adopt the budget prior to the start of the fiscal year. The Board also adopts subsequent revisions that occur throughout the year. All annual appropriations lapse at fiscal year‐end.

The legal level of budgetary control (i.e., the level at which expenditures may not legally exceed appropriations) is maintained at the fund, department, and object level with more stringent control over capital assets, and fund balance accounts which are controlled at the line item level. Presentation of the basic financial statements at the legal level is not feasible due to excessive length; therefore, the budget and actual statements have been aggregated by function. The County prepares a separate Final Budget document that demonstrates legal compliance with budgetary control. This document is made available to the public on the County’s website, or can be obtained from the Auditor‐Controller’s office.

For the year ended June 30, 2015, no instances existed in which expenditures exceeded appropriations.

The Board must approve amendments or transfers of appropriations between funds or departments, as well as items related to capital assets, and fund balance accounts. Supplemental appropriations necessary and normally financed by unanticipated revenues during the year must also be approved by the Board. Finally, the Board must approve amendments or transfers of appropriations between object levels within the same department. Any deficiency caused by expenditures and other financing uses being greater than revenues and other financing sources is financed by beginning available fund balances as provided for in the County Budget Act.

61

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

3. RECONCILIATION OF GOVERNMENTWIDE AND FUND FINANCIAL STATEMENTS

Amounts reported for governmental activities in the Statement of Net Position are different from those reported for governmental funds in the balance sheet. The following two schedules provide a reconciliation of those differences:

Total Governmental Funds (Page 35)

Long‐term

Assets and Liabilities (1)

Internal Service Funds (2) (Page 42)

Adjustments (3)

Total Governmental Activities (Page 30)

Assets & deferred outflows of resources:

Assets
Cash and investments $

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services
Other

Due from other funds Internal balances Inventories
Prepaid items

Note receivable
Other receivables
Advances to other funds Restricted cash and investments Housing loans receivable
Housing loans interest receivable Capital assets

Total assets $ Deferred outflows of resources

Deferred social services Deferred pensions

Total deferred outflows of resouces

Total assets & deferred outflows of resources $

Liabilities, deferred inflows of resources, & fund balances/net position
Liabilities

Accounts payable $ Salaries and benefits payable
Interest payable
Other payables and long‐term obligations

Advances from grantors and third parties Unearned revenue
Due to other funds
Customer deposits payable

Compensated absences
Capital lease obligations Certificates of participation (COP) Unamortized premium on COP Unamortized discount on COP Bonds and notes payable
Liability for self‐insurance claims Estimated litigation liability
OPEB obligation
Net pension liability

Total liabilities

Deferred inflows of resources Deferred unavailable revenues

Deferred housing loan payments
Deferred pensions
Deferred service concession arrangements

Total deferred inflows of resouces

Fund balances/net position:

Total fund balances/net position

Total liabilities, deferred inflows of resources, & fund balances/net position $

251,254 26,345 494 318 1,865 44,544 18,975 1,213 3,515 — — 50 — 4,745 1,760 19,604 38,788 5,878 — 419,348

514 — 514

419,862

19,125 31,670 — 8,492 21,419 1,582 3,515 7,978 — — — — — — — — — — 93,781

371 44,666 — — 45,037

281,044 419,862

$

— $ 55,968 — — — — — — — 58 — — — 488 — 55 — — — — — 258 — —

14,220 — 660 762 — — — 10 — — — — 647,725 27,833 662,605 85,432

— — 113,400 1,687 113,400 1,687

776,005 $ 87,119

— $ 621

— 525 238 — — 15 — — — — — — — — 30,770 732 2,686 — 29,683 — 14 — (147) — 19,325 4,255 — 24,242 203 — 88,143 1,635 547,775 7,877 718,690 39,902

(371) — (40,718) — 118,325 1,759 33,096 — 110,332 1,759

(53,017) 45,458 776,005 $ 87,119

$

— — — — — — — —

(3,515) 2,228 — — — —

(1,760) —

— — —

(3,047)

— — —

(3,047)

— — — — — —

(3,515) —

— — — — — — — — — —

(3,515)

— — — — —

468 (3,047)

$

307,222 26,345 494 318 1,923 44,544 19,463 1,268 — 2,228 258 50 14,220 6,167 — 19,614 38,788 5,878 675,558 1,164,338

514 115,087 115,601

1,279,939

19,746 32,195 238 8,507 21,419 1,582 — 7,978 31,502 2,686 29,683 14

(147) 23,580 24,242 203 89,778 555,652 848,858

— 3,948 120,084 33,096 157,128

273,953 1,279,939

$

$

$

$

$

$

$

$

$

62

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

3. RECONCILIATION OF GOVERNMENTWIDE AND FUND FINANCIAL STATEMENTS ‐ CONTINUED

  1. (1)  Capital assets used in governmental activities (excluding Internal Service Funds) are not current financial resources and, therefore, are not reported in the balance sheet (Note 7).

    Long‐term liabilities are not due and payable in the current period and, therefore, are not reported in the balance sheet (Note 10):

    Certificates of participation
    Unamortized premium on certificates of participation Unamortized discount on certificates of participation Bonds and notes payable (excluding Internal Service Funds) Capital lease obligations (excluding Internal Service Funds) Estimated liability for litigation
    Compensated absences (excluding Internal Service Funds) OPEB obligation (excluding Internal Service Funds)
    Net pension liability (excluding Internal Service Funds)

    Total long‐term liabilities
    Deferred outflows of resources reported in the Statement of Net Position (Note 17).
    Accrued interest on long‐term debt
    Other long‐term assets are not available to pay for current period expenditures and, therefore,

    are deferred and in the funds and recognized as revenue in the Statement of Activities (Note 17). Deferred inflows of resources reported in the Statement of Net Position (Note 17).
    Internal Service Funds deferred inflows of resources reported in the Statement of Net Position (Note 17). Note receivable for governmental activities from the RDA Successor Agency

    private‐purpose trust fund. Other receivable

  2. (2)  Internal Service Funds are used by management to charge the costs of information technology, reprographics and digital imaging services, vehicle operations and maintenance, risk management
    and insurance, communications and utility services to individual funds. The assets and liabilities
    of the Internal Service Funds are included in the governmental activities in the statement of net position.
  3. (3)  Adjustment for Internal Service Funds are necessary to “close” those funds by charging additional amounts to participating business‐type activities to completely cover the Internal Service Funds’ costs for the year. Also included are immaterial rounding adjustments.

$ 647,725

$ (29,683) (14)

147 (19,325) (2,686) (203) (30,770) (88,143) (547,775)

(718,452) 113,400

(238)

45,037 (157,128)

1,759

14,220 660

$ (53,017)

$ 45,458

$ 468

63

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

4. CASH AND INVESTMENTS

Cash and investments include the cash balances of substantially all funds, which are pooled and invested by the County Treasurer. The Santa Barbara County Treasury Pool (Pool) is not registered as an investment company with the Securities and Exchange Commission (SEC) nor is it an SEC Rule 2a7‐like pool.

Custodial Credit Risk Related to Deposits

The custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, the Pool will not be able to recover deposits or will not be able to recover collateral securities that are in possession of an outside party. This risk is mitigated in that of the County’s total bank balance, $250 is insured by the Federal Depository Insurance Corporation. The remaining $143,087 on deposit is collateralized with securities held by the pledging financial institution’s agent. Per Government Code Section 53652, the depository is required to maintain a market value of at least 110% of the pledged collateral.

At June 30, 2015, the carrying amount of the Pool’s deposits was $149,161 and the corresponding bank balance was $143,337. The difference of $5,823 was principally due to deposits in transit.

Investments

Pursuant to Section 53646 of the Government Code the County Treasurer prepares an Investment Policy Statement annually, presents it to the Treasury Oversight Committee (TOC) for review and to the Board of Supervisors for approval. After approval, the policy is forwarded to the California Debt and Investment Advisory Commission.

The Investment Policy Statement provides the basis for the management of a prudent, conservative investment program. Public funds are invested to provide the maximum security of principal with secondary emphasis on achieving the highest return, while meeting daily cash flow needs. All investments are made in accordance with the Government Code and, in general, the Treasurer’s Investment Policy is more restrictive than state law. Types of securities in which the Treasurer may invest include U.S. Treasury and U.S. Government agency securities; state and/or local agency bonds, notes, warrants or certificates of indebtedness; bankers’ acceptances; commercial paper; corporate notes; negotiable certificates of deposit; repurchase agreements; reverse repurchase agreements; securities lending; bank deposits; money market mutual funds; the State of California Local Agency Investment Fund (LAIF); and the investment pools managed by a Joint Powers Authority. As of June 30, 2015, all investments are in compliance with State law and with the investment policy.

Investments are stated at fair value. Fair value is established quarterly based on quoted market prices received from the securities custodian. Fair value of investments held fluctuates with interest rates. The fair value of participants’ position in the Pool is the same as the value of the Pool shares. The value of participants’ equity withdrawn is based on the book value of the participants’ percentage participation at the date of such withdrawal.

The Pool participates in LAIF and the California Asset Management Program (CAMP). Investments in the LAIF and CAMP are governed by state statutes and overseen by a five member Local Investment Advisory Board and a 7 member Board of Trustees, respectively.

Credit Risk and Concentration of Credit Risk

Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Concentration of credit risk is the risk of loss attributed to the magnitude of an investment in a single issuer. The Treasurer mitigates these risks by holding a diversified portfolio of high quality investments.

64

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

4. CASH AND INVESTMENTS ‐ CONTINUED

The Treasurer’s Investment Policy sets specific parameters by type of investment to be met at the time of purchase. Commercial paper obligations and negotiable certificates of deposit shall be rated by at least two of the three major rating services at a minimum of F1 by Fitch, P‐1 by Moody’s and A‐1 by Standard & Poor’s (S&P). Corporate notes, with a maturity greater than three years, shall be rated at a minimum of AA by at least two of the three major rating services. Corporate notes, with a maturity of three years or less, shall be rated at a minimum of AA‐ by at least two of the three major ratings services. Corporate Temporary Liquidity Guarantee Program (TLGP) notes shall be rated AAA by one of three major ratings services.

The following is a summary of the credit quality distribution by investment type as a percentage of fair value at June 30, 2015:

Treasurer’s Pooled Investments: CAMP

LAIF
Government Agency Bonds and Notes Government Agency Bonds and Notes US Treasuries

Total Treasurer’s Pooled Investments * Not Rated

Moody’s S&P Fitch

NR* AAAm NR NR NR NR Aaa AA+ AAA

Aaa AA+ NR Aaa AA+ AAA

% of Portfolio

1.01%

5.06% 41.20% 28.42% 24.31%

100.00%

Instruments in any one issuer that represent 5% or more of the County’s investments as of June 30, 2015 are as follows (excluding external investment pools and debt explicitly guaranteed by the U.S. government):

Issuer
Treasurer’s Pooled Investments:
Federal Home Loan Mortgage Corporation Federal Home Loan Bank
Federal Farm Credit Bank
Federal National Mortgage Association

Custodial Credit Risk

Issuer Type

Government Sponsored Government Sponsored Government Sponsored Government Sponsored

Fair Value Holdings

$ 172,409,557 $ 280,728,370 $ 139,987,550 $ 94,450,436

Percentage Holdings

17.46% 28.42% 14.17% 9.56%

Custodial credit risk for investments is the risk that the Pool will not be able to recover the value of investment securities that are in the possession of an outside party. All securities owned by the Pool are deposited in trust for safekeeping with a custodial bank different from the County’s primary bank. Securities are not held in broker accounts.

Interest Rate Risk

Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The Pool mitigates this risk by making longer‐term investments only with funds that are not needed for current cash flow purposes and holding these securities to maturity. The maturity of investments purchased is governed by a demand for funds analysis of prior periods’ revenues and expenditures, and is also determined by current cash flow demands assessed on an ongoing basis. The Investment Policy also dictates that the final maturity date of any individual security shall not exceed five years and that long‐term investments (greater than one year), in the aggregate, shall not exceed 75% of the portfolio.

65

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

4. CASH AND INVESTMENTS ‐ CONTINUED

The fair value of investments generally changes with the fluctuations of interest rates. In a rising interest rate market, the fair value of investments could decline below original cost; conversely, when interest rates decline, the fair value of investments increases. The Treasurer believes liquidity in the portfolio is sufficient to meet cash flow needs for the next six months and will preclude the Treasurer from having to sell investments below amortized cost. At June 30, 2015, $38,149, or 3.86%, of the Pool was held in U.S. agency step‐up notes. These securities grant the issuer the option to call the note on a certain specified date(s). On a certain date, or dates, the coupon rate of the note increases (steps up) by an amount specified at the inception of the note.

Interest net realized earnings are apportioned quarterly to Pool participants based upon each participant’s average daily cash balance. Unrealized gains and losses are also apportioned quarterly to participating funds based upon the participant’s ending cash balance.

Investment income consisted of the following for the year ended June 30, 2015:

Investment earnings
Net increase in fair value of investments Administrative expenses

Net investment income

$ 5,782 1,200

(1,753)

$ 5,229

The Treasurer may purchase securities at a discount from face value to earn higher than nominal rates of return. Under GASB Statement No. 31, “Accounting and Financial Reporting for Certain Investments and for External Investment Pools,” such discount, when realized, is considered a gain rather than interest.

The following is a summary of investments held by the County as of June 30, 2015: Interest Rate

Weighted Average Maturity

On Demand On Demand 553days 332days 191days 871days

Investment
Treasurer’s pooled investments:

CAMP $ LAIF
US Treasuries
Government agency bonds

Cost

10,000

50,000 240,000 194,500 173,135 320,265

987,900

Fair Value

Maturity Range

On Demand

0.29%
.25%-1.50% 8/15-5/19 .22%-2.25% 7/15-7/17

Dis c o u n t 7/ 15-6/ 16 .40%-2.00% 9/15-2/20

Government agency discount notes Government agency bonds ‐ callable

Total pooled and directed investments

Investments held with fiscal agents:

Cash in banks:
Non‐interest bearing deposits

Cash on hand:
Total cash and investments

Total unrestricted cash and investments
Total restricted cash and investments (Note 5)

Total cash and investments

Total cash and investments summary: Total governmental activities
Total business‐type activities
Total fiduciary funds

Total cash and investments

$

$

$

$

$ $

$ $

10,000

50,000 240,158 194,638 172,954 319,984

987,734 6,592

149,160

60 1,143,546

1,103,385 40,161 1,143,546

326,836 54,764 761,946 1,143,546

Range

0.08%

On Demand

66

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

4. CASH AND INVESTMENTS ‐ CONTINUED

The following is a reconciliation between cash and investments and the Net Position of the Treasurer’s investment pool as of June 30, 2015:

Total cash and investments
Less: investments held with fiscal agents Less: cash on hand
Add: cash and investment interest receivable

$

$

1,143,546 (6,592) (60)

1,300 1,138,194

The following represents a condensed Statement of Net Position and Changes in Net Position for the Treasurer’s investment pool as of June 30, 2015:

Statement of Net Position
Net position held in trust $

Equity of internal pool $ Equity of external pool participants (voluntary and involuntary)

Total equity $

Statement of Changes in Net Position
Net position held for pool participants, July 1, 2014 $ Net change in investments by pool

Net position held for pool participants, June 30, 2015 $

1,138,194

443,048 695,146

1,138,194

1,021,329 116,865

1,138,194

Additional detailed information and/or separately issued financial statements of the County Treasurer’s Investment Pool can be obtained from the County Treasurer‐Tax Collector’s office located at 105 East Anapamu Street, Room 109, Santa Barbara, CA 93102.

67

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

5. RESTRICTED CASH AND INVESTMENTS

Cash and investments at June 30, 2015 that are restricted by legal or contractual requirements are comprised of the following:

Governmental Activities

General Fund
Deposits by various developers Property tax loss reserve
Court ordered restitution funds

Total General Fund

Major Governmental Funds
Energy efficiency loan loss reserve Capital projects funds

Total major governmental funds

Nonmajor Governmental Funds Debt service reserves
Clean water plan check trust

Total nonmajor governmental funds

Internal Service Funds
Funds for underground tank clean‐up

Total internal service funds Total governmental activities

Business‐type Activities

Resource Recovery Fund
Funds for landfill site closure and maintenance costs (see Note 16) Financial assurance for landfill corrective action (see Note 16) Debt service reserves (see Note 15)

Total Resource Recovery Fund

Laguna Sanitation Fund
Financial assurance for landfill corrective action

Total Laguna Sanitation Fund Total business‐type activities

Total restricted cash and investments

$

7,550 7,442 206

2,587 604

1,200 15

10

16,553 1,643 787

124

$

15,198

3,191

1,215

10

19,614

18,983

124

19,107

38,721

$

68

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

6. RECEIVABLES

GASB Statement No. 38, “Certain Financial Statement Note Disclosures,” requires disclosure of significant receivable balances not expected to be collected within one year of the date of the financial statements. The detail of receivable balances not expected to be collected within the next fiscal year is as follows:

Note Receivable

The County has recorded a note receivable for governmental activities from the RDA Successor Agency Private‐ purpose Trust Fund. The total balance of the note receivable at June 30, 2015 is $14,220 and the amount not expected to be collected within the next fiscal year is $13,455.

Housing Loans Receivable and Housing Loans Interest Receivable

A total of $38,788 was recorded as housing loans receivable and a total of $5,878 was recorded as housing loans interest receivable at June 30, 2015. These represent low or no interest mortgage notes and related accrued interest to finance multi‐family and single family construction and rehabilitation projects, as well as homebuyer assistance for low income families, as part of the County’s affordable housing program. Loan terms range from 15 to 55 years with interest rates from 0% to 7.02%. Loans, with a total principal balance of $3,948, contain a forgiveness clause and more than likely will not be repaid back to the County. The County’s primary sources of funding for these loans come from grants from the federal HOME Investment Partnership (HOME) and Community Development Block Grant (CDBG) programs. The HOME and CDBG grants contain monitoring requirements to ensure grant compliance. These requirements are reflected in the loan agreements. Due to the terms of the loans, offsetting deferred inflows of resources of $44,666 have been established in the Governmental Funds Balance Sheet for the housing loan principal and interest payments. Additionally, offsetting deferred inflows of resources of $3,948 have been established in the Statement of Net Position for the principal balance of loans with a forgiveness clause.

Accounts Receivable

The County has accrued accounts receivable of $371 for prior years’ Federally Qualified Health Care Medi‐Cal settlement payments in the Public Health Fund. This amount is not expected to be collected within the next fiscal year.

Other Receivables

The following amounts are included in other receivables on the financial statements, and are not expected to be received within the next fiscal year:

  •   $2,910 for impounded disputed property taxes; and
  •   $200 deposit with the County’s workers’ compensation claims administrator.

7. CAPITAL ASSETS

Capital asset activity for the year ended June 30, 2015 includes the following adjustments amounts:

  •   ($1,719) adjustment to Work in Progress to correct for prior year costs related to a capital project that was not completed (see Note 24).
  •   ($362) adjustment to Work in Progress to correct for prior year costs related to a capital project that should have been depreciating for multiple years (see Note 24).
  •   ($95) adjustment to Work in Progress to correct for prior year costs that were capitalized that should have been expensed (see Note 24).
  •   $1,211 adjustment to Work in Progress to correct for prior year costs that were expensed that should have been capitalized (see Note 24).

69

Notes to the Financial Statements

7.

CAPITAL ASSETS ‐ CONTINUED

Capital assets activity for the year ended June 30, 2015 was as follows:

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

Balance July 1, 2014

Additions/ Restatements

$ — 4 2,643 21,734

Deletions

Transfers & Adjustments, net

Balance June 30, 2015

54,699 47,320 36,550 48,818

187,387

24,036 264,014 136,755 352,191

776,996

(7,035) (104,269) (75,993) (101,528)

(288,825) 488,171 675,558

13,176 616

13,792

483 10,474 29,762 73,043 113,762

(190) (4,315) (15,027) (21,298) (40,830)

72,932 86,724

762,282

Governmental activities:

Capital assets, non‐depreciable: Land

Land easements
Service concession arrangements Work in progress

Total capital assets, non‐depreciable

Capital assets, depreciable/amortizable: Land improvements
Structures and improvements Equipment and software Infrastructure

Total capital assets, depreciable/amortizable

Less accumulated depreciation/amortization for: Land improvements
Structures and improvements
Equipment and software

$

54,699 47,316 33,907 56,383

192,305

18,240 308,953 122,450 294,886

744,529

(6,484) (98,090) (71,138)

$ –$ — — — — — (29,299) —

$

Infrastructure (96,215) Total accumulated depreciation/amortization (271,927)

Total capital assets, depreciable/amortizable, net 472,602 Sub‐total governmental activities 664,907

Business‐type activities:

Capital assets, non‐depreciable:
Land 13,176 Work in progress 2,797

Total capital assets, non‐depreciable 15,973 Capital assets, depreciable/amortizable:

Land improvements 483 Structures and improvements 10,473 Equipment and software 31,121 Infrastructure 66,782

Total capital assets, depreciable/amortizable 108,859 Less accumulated depreciation/amortization for:

Land improvements (179) Structures and improvements (4,022) Equipment and software (16,221) Infrastructure (19,654)

24,381

5,796

2,740 20,054 9,626

38,216

(551) (6,179) (10,261) (5,313)

(22,304) 15,912 40,293

— 4,161

4,161

— 1 2,174 6,261 8,436

(11) (293) (1,551) (1,644) (3,499)

4,937 9,098

49,391

(29,299) —

— —

— (47,679) (5,749) — — 47,679

(5,749) —

— —

— — 5,406 — — —

5,406 — (343) — (29,642) —

— — (6,342) —

(6,342) —

— —

— — (3,533) — — — (3,533) —

— —

— — 2,745 — — — 2,745 —

(788) — (7,130) —

(36,772) $ —

Total accumulated depreciation/amortization Total capital assets, depreciable/amortizable, net

Sub‐total business‐type activities Total capital assets, net

$

(40,076) 68,783 84,756

749,663

$

$

$

70

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

7.

CAPITAL ASSETS ‐ CONTINUED

Capital assets activity for each major enterprise fund for the year ended June 30, 2015 was as follows:

Balance July 1, 2014

Additions

$ — 3,832 3,832

Transfers & Deletions Adjustments, net

$ –$ — (6,342) — (6,342) —

Balance June 30, 2015

9,487 25 9,512

3,175 20,755 46,320 70,250

(1,768) (10,631) (12,405) (24,804)

45,446

54,958

3,689 591

4,280

483 7,299 9,007 26,723 43,512

(190) (2,547) (4,396) (8,893)

(16,026)

27,486 31,766

86,724

Resource Recovery:

Capital assets, non‐depreciable: Land

Work in progress
Total capital assets, non‐depreciable

Capital assets, depreciable/amortizable: Structures and improvements Equipment and software Infrastructure

Total capital assets, depreciable/amortizable

Less accumulated depreciation/amortization for: Structures and improvements
Equipment and software
Infrastructure

Total accumulated depreciation/amortization Total capital assets, depreciable/amortizable, net

Sub‐total Resource Recovery

Laguna Sanitation:

Capital assets, non‐depreciable: Land

Work in progress
Total capital assets, non‐depreciable

Capital assets, depreciable/amortizable: Land improvements
Structures and improvements Equipment and software Infrastructure

Total capital assets, depreciable/amortizable

Less accumulated depreciation/amortization for: Land improvements
Structures and improvements
Equipment and software

$

9,487

2,535 12,022

3,175 22,352 40,059 65,586

(1,684) (12,027) (11,353) (25,064)

40,522

52,544

3,689 262

3,951

483 7,298 8,769 26,723 43,273

$

(179) (2,338) (4,194) Infrastructure (8,301) (15,012)

— 1,837 6,261 8,098

(84) (1,255) (1,052) (2,391)

5,707

9,539

— 329

329

— 1 337 — 338

(11) (209) (296) (592)

(1,108)

(770) (441)

9,098

— — (3,434) — — — (3,434) —

— — 2,651 — — — 2,651 —

(783) —

(7,125) —

— — — —

— —

— —

— — (99) — — — (99) —

— —

— — 94 — — —

94 —

(5) — (5) —

(7,130) $ —

Total accumulated depreciation/amortization Total capital assets, depreciable/amortizable, net

Sub‐total Laguna Sanitation

Total capital assets, net ‐ business‐type activities

$

28,261 32,212

84,756

$

$

$

71

Notes to the Financial Statements

7.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

CAPITAL ASSETS ‐ CONTINUED

Internal Service Funds (ISF) predominantly serve the governmental funds. Accordingly, their capital assets are included within governmental activities. Capital assets activity for Internal Service Funds for the year ended June 30, 2015 was as follows:

Balance July 1, 2014

2,606 54,183 56,789

(854) (30,582) (31,436)

25,353

Additions

— 7,023 7,023

(66) (4,318) (4,384)

2,639

Deletions

— (3,707) (3,707)

— 3,548 3,548

(159)

Transfers & Adjustments, net

Balance June 30, 2015

Internal Service Funds:

Capital assets, depreciable/amortizable: Structures and improvements Equipment and software

Total capital assets, depreciable/amortizable

Less accumulated depreciation/amortization for: Structures and improvements
Equipment and software

Total accumulated depreciation/amortization

Total capital assets, net ‐ internal service funds

$

$

$

$

$

$

$

$

— — —

— — —

$

$

2,606 57,499 60,105

(920) (31,352) (32,272)

27,833

Depreciation/amortization expense was charged to functions/programs of the primary government as follows:

Depreciation/

Amortization (excluding ISF)

ISF Depreciation/ Amortization Allocation (1)

$ 90 2,103 1,116 764 310 1

Total

22,304

2,391 1,108

3,499

25,803

Governmental activities:

Policy & executive
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs
Sub‐total governmental activities

Business‐type activities:

Resource Recovery
Laguna Sanitation
Sub‐total business‐type activities

Total depreciation expense

$

618 4,957 2,738 7,026 2,515 66

17,920

2,391 1,108

3,499

21,419

$

708 7,060 3,854 7,790 2,825 67

4,384

— —

$

$

4,384 $

(1) Depreciation/amortization of capital assets held by the County’s ISF is charged to the various functions based on their usage of the assets.

72

Notes to the Financial Statements

7.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

CAPITAL ASSETS ‐ CONTINUED

Work in progress at June 30, 2015 consists of the following projects for the primary government:

Governmental activities:

Capital Outlay projects: North County jail

Main Jail Sewer Replacement
Live Oak Camp Improvements
Santa Barbara Courthouse HVAC
Santa Barbara Courthouse elevator
Other projects (individually less than $800)

Roads projects:
Jalama Road bridge

Cathedral Oaks bridge
Sandspit Road bridge
Floridale Avenue bridge
Hollister Avenue widening
Calle Real pedestrian path
Foothill Road Low Water Crossing replacement Fernald Point bridge

Other projects (individually less than $500)

Flood Control projects:
Mission Creek Corps project

Las Vegas Creek/Encina drain
Other projects (individually less than $500)

General Fund projects Public Health projects Special Aviation projects

Sub‐total governmental activities

Business‐type activities:

Laguna Sanitation projects Resource Recovery projects

Sub‐total business‐type activities
Total work in progress

$

7,098 2,024 1,080

829

728 2,586

3,216 3,132 1,141 1,105

888 855 707 643

1,853

13,258 5,300 1,019

$ 14,345

13,540

19,577 1,087 147 122

48,818

591 25

616 $ 49,434

73

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

8. SERVICE CONCESSION ARRANGEMENTS (SCA)

GASB Statement No. 60 (GASB 60), “Accounting and Financial Reporting for Service Concession Arrangements (SCA)” defines an SCA as a type of public‐private or public‐public partnership. As used in GASB 60, an SCA is an arrangement between a government (the transferor) and an operator in which all of the following criteria are met:

  1. The transferor conveys to the operator the right and related obligation to provide public services through the use and operation of a capital asset (referred to in the statement as a “facility”) in exchange for significant consideration, such as an up‐front payment, installment payments, a new facility, or improvements to an existing facility.
  2. The operator collects and is compensated by fees from third parties.
  3. The transferor determines or has the ability to modify or approve what services the operator is required

    to provide, to whom the operator is required to provide the services, and the prices or rates that can be charged for the services.

The County has determined that the following arrangements meet the criteria set forth above (where the County is the transferor) and therefore included these SCAs in the County’s financial statements. GASB 60 also provides guidance on accounting treatment if the County were acting as an operator of another government’s facility. The County has determined that there are no incidences where the County would qualify as such an operator.

Boathouse Restaurant

On February 1, 2008, the County entered into a 10‐year agreement (having options for a 10‐year extension and a subsequent 5‐year extension) with Santa Barbara Shellfish Company Incorporated (SB Shellfish), under which SB Shellfish will operate the Boathouse Restaurant, a walk‐up snack bar, and rent beach‐related equipment and supplies. Services are to be provided at reasonable rates. A summary of the important details, capital assets and the present value of installment payments pertaining to this SCA can be found below.

Cachuma Store and Marina

On March 6, 2012, the County entered into a 10‐year agreement with Pyramid Enterprises, Incorporated (Pyramid), under which Pyramid will operate the Cachuma store and marina and sell gas. Services are to be provided at reasonable rates. The structures and related equipment pertaining to the SCA have been fully depreciated. A summary of the important details of this SCA can be found below.

Santa Barbara County Bowl

On June 1, 2011, the County entered into a 45‐year agreement (having an option for a 25‐year extension) with the Santa Barbara County Bowl Foundation (Foundation), under which the Foundation will operate the outdoor amphitheater, maximizing access for community programs, stage events, musical performances, and other performing art events. Prices for merchandise, food, and beverages are to be comparable to prices charged at similar establishments; however, the Foundation sets ticket pricing. A portion of each ticket goes to the Santa Barbara Arts Commission with the remaining revenue used to run operations and maintain and improve facilities. A summary of the important details and the capital assets pertaining to this SCA can be found below.

Beachside Restaurant

On March 25, 1985, the County entered into a 37‐year agreement with Richhardy Corporation (Richhardy), under which Richhardy will have exclusive rights to operate and maintain a food and beverage business, fishing tackle and bait shop, and boat rental business. The County has the ability to review the rates Richhardy charges. A summary of the important details, capital assets, and the present value of installment payments pertaining to this SCA can be found below.

74

Notes to the Financial Statements

8.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

SERVICE CONCESSION ARRANGEMENTS (SCA) ‐ CONTINUED

Jalama Beach Store

On January 1, 2008, the County entered into a 10‐year agreement (having an option for two 5‐year extensions) with Jalama Beach Store Incorporated (Jalama), under which Jalama has the right to the sell food and beverages (including beer and wine), kitchen supplies, camping supplies, housekeeping and other related supplies and conveniences; rent swimming and beach equipment & supplies; operate a restaurant and delicatessen; and rent vacation trailers. Services are to be provided at reasonable rates. A summary of the important details, capital assets and the present value of installment payments pertaining to this SCA can be found below.

A summary of the important details for each SCA over the term of their agreements are as follows:

Date SCA Entered Into 2/1/2008

1/1/2008 3/25/1985 3/6/2012

6/1/2011

Term of SCA 10 years

10 years 37 years 10 years

45 years

Expiration of SCA

Minimum Installment Payment (per month)

Revenue Sharing 10% gross sales; 1.47% on income over $3.8 million 8% of gross sales

6% of gross sales

10% of marina gross sales; 7% of store gross sales; 3 cents per gallon of gasoline

$0.25 per ticket sold up to $50,000 per concert

Boathouse Restaurant Jalama Beach Store

Beachside Restaurant Cachuma Store and Marina

Santa Barbara County Bowl

12/31/2017 $ 16 12/31/2017 3

3/31/2022 2 3/5/2022 –

5/31/2056 – $ 21

Capital assets balances for each SCA for the year ended June 30, 2015 and over the term of the agreement are as follows:

Structures & Structure

Improvements Land

$ 33,041 $ 1,698

568 55

$ 35,362 $

Total

Santa Barbara County Bowl Boathouse Restaurant Beachside Restaurant Jalama Beach Store

1,188 $ –

1,188 $

34,229 1,698 568 55

36,550

75

Notes to the Financial Statements

8.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

SERVICE CONCESSION ARRANGEMENTS (SCA) ‐ CONTINUED

The deferred inflows of resources activity for each SCA for year ended June 30, 2015 was as follows:

Balance July 1, 2014

Additions/ Restatements

Deletions/ Amortization (1)

Balance June 30, 2015

31,264 758 391 28

32,441

453 117 85

655 $ 33,096

SCA Capital Assets

Santa Barbara County Bowl Boathouse Restaurant Beachside Restaurant Jalama Beach Store

Sub‐total SCA capital assets

Present Value of Installment Payments (2):

Boathouse Restaurant Beachside Restaurant Jalama Beach Store

Sub‐total present value of installment payments

Total deferred inflows

$

29,402 $ 2,628 $ (766) 1,071 — (313) 450 — (59) 24 16 (12)

30,947 2,644 (1,150)

635 — (182) 135 — (18) 118 — (33)

888 — (233)

$

31,835 $ 2,644 $

(1,383)

  1. (1)  Amortization calculated using straight‐line method for the term of agreement for each SCA.
  2. (2)  Installment payments present value calculated using a discount rate of 2.1% for the term of agreement for each

    SCA.

76

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

9. ADVANCES FROM GRANTORS AND THIRD PARTIES

Under both the accrual and modified accrual basis of accounting, revenue may be recognized only when earned. Therefore, the governmentwide Statement of Net Position as well as governmental and enterprise funds defer revenue recognition in connection with resources that have been received as of year‐end, but not yet earned. Assets recognized in connection with a transaction before the earnings process is complete are offset by a corresponding liability for advances from grantors and third parties.

At June 30, 2015, the various components of advances from grantors and third parties reported are as follows: Advances

General Fund:
Camping and day use fees

Total General Fund

Social Services Fund:
Grant drawdowns prior to meeting eligibility requirements

Capital Projects Fund: Developer mitigation fees

Roads Fund:
Farmworker fare revenue
Advances from California Department of

Transportation for road projects Total Roads Fund

Affordable Housing Fund:
Advances on state & federal grants for Affordable Housing

Alcohol, Drug, and Mental Health Services Fund:
Early, periodic, screening, diagnosis, and treatment Mental Health Services Act capital/information technology

Total Alcohol, Drug, and Mental Health Fund

Fire Protection District Fund: Fire district mitigation fees

Flood Control District Fund: Developer mitigation fees

Nonmajor Governmental Funds:
Advances on state & federal grants for Child Support Services

Total advances from grantors and third parties

$ 965 965

6,189

6,143

3,610 707

4,317

2,484

134 93

227

568

172

354

$ 21,419

77

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

10. LONG‐TERMLIABILITIES
Changes in Long‐term Liabilities

The long‐term liability activity for the year ended June 30, 2015 was as follows: Balance

Balance June 30, 2015

2,686 $
29,683 883

Governmental activities:

Capital lease obligations Certificates of participation (COP)

Unamortized premium on COP

Unamortized discount on COP Bonds and notes payable Compensated absences
Liability for self‐insurance claims Estimated litigation liability OPEB obligation

Net pension liability* Other long‐term liabilities

Sub‐total governmental activities

Business‐type activities:

Certificates of participation Unamortized premium on COP

Bonds and notes payable Compensated absences
Landfill closure/postclosure care costs OPEB obligation
Net pension liability*

Sub‐total business‐type activities Total long‐term liabilities

$

Deletions

$ (327) (11,909) — (7)

— 52 9,925 (3,415) 28,006 (27,954) 4,765 (8,940) — (591)

16,657 — — (153,551) 1,109 (803)

60,462 (207,445)

— (695) — (25) — (741)

612 (608) 6,818 (820)

344 — — (2,761)

7,774 (5,650)

68,236 $ (213,095)

$

July 1, 2014

Additions

Due Within One Year

3,013
41,592 —

$

21 (199) 17,070

31,450 28,417 794 73,121 709,203 2,434 906,916

6,692 89 8,203 668 20,796 1,571 12,569

50,588

957,504

$

$

14 (147)

23,580 31,502 24,242

203 89,778 555,652 2,740 759,933

5,997 64 7,462 672 26,794 1,915 9,808

52,712

812,645

— 2,890 27,954 7,047 — — — — 39,119

717 — 757 595 439 — —

2,508

$ 41,627

$ —

345

The long‐term liability activity for each major enterprise fund for the year ended June 30, 2015 was as follows:

Balance July 1, 2014

Additions

$ — — 495 6,818 280 — 7,593

Balance June 30, 2015

(695) $
(25) 64

(488) 565 (820) 26,794 — 1,554 (2,243) 7,846 (4,271) 42,820

(741) 7,462 (120) 107 — 361 (518) 1,962 (1,379) 9,892

(5,650) $ 52,712

Due Within One Year

$ 717 — 488 439 — — 1,644

757 107 — — 864

$ 2,508

Deletions

Resource Recovery:

Certificates of participation Unamortized premium on COP

Compensated absences
Landfill closure/postclosure care costs OPEB obligation
Net pension liability*

Sub‐total Resource Recovery

Laguna Sanitation:

Bonds and notes payable Compensated absences OPEB obligation
Net pension liability*

Sub‐total Laguna Sanitation

Total long‐term liabilities ‐ business‐type activities

$

6,692 89 558 20,796 1,274 10,089 39,498

8,203 110 297 2,480 11,090

50,588

$

5,997

— 117 64 — 181

$

$

7,774 $

*The net pension liability is a new long‐term liability beginning in Fiscal Year 2014‐15 as a result of the implementation of GASB Statement No. 68. The prior year balance is a result of a prior period adjustment (Note 24).

78

Notes to the Financial Statements

10.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

LONG‐TERM LIABILITIES ‐ CONTINUED

In governmental activities, the liability for the majority of employee compensated absences, litigation, and other postemployment benefit obligations are liquidated by the General Fund. The self‐insurance claims liability is reported in the risk management and insurance internal service fund and will be liquated by that fund.

Internal Service Funds predominantly serve the governmental funds. Accordingly, their long‐term liabilities are included as part of the totals for governmental activities. The long‐term liability activity for the Internal Service Funds for the year ended June 30, 2015 was as follows:

Balance July 1, 2014

Additions

Deletions

Balance June 30, 2015

732 4,255 24,242 1,635 7,877

38,741

Due Within One Year

Internal Service Funds:

Compensated absences
Bonds and notes payable Liability for self‐insurance claims OPEB obligation
Net pension liability*

Total long‐term liabilities ‐ Internal Service Funds

$

$

737 4,590 28,417 1,341 10,127

45,212

$

$

483 $ (488) — (335) 4,765 (8,940)

294 — — (2,250)

5,542 $ (12,013)

$

$

$

$

488

335 7,047 — —

7,870

*The net pension liability is a new long‐term liability beginning in Fiscal Year 2014‐15 as a result of the implementation of GASB Statement No. 68. The prior year balance is a result of a prior period adjustment (Note 24).

Rebatable Arbitrage Earnings

The Tax Reform Act of 1986 instituted certain arbitrage restrictions with respect to the issuance of tax‐exempt bonds after August 31, 1986. Arbitrage regulations deal with the investment of all tax‐exempt bond proceeds at an interest yield greater than the interest yield paid to bondholders. Generally, all interest paid to bondholders can be retroactively rendered taxable if applicable rebates are not reported and paid to the Internal Revenue Service at least every five years. During the current year, the County performed calculations of excess investment earnings on various bonds and financings, and found that the County had no rebateable arbitrage liability at June 30, 2015.

Governmental Activities – Conduit Debt

Fixed Rate Obligation – Montecito Retirement Association

In March 2004, the County issued conduit debt in the form of certificates of participation (COP) under the authority of Chapter 7 of Part 5 of Division 3 of the Health and Safety Code of the State of California. This was done on behalf of the Montecito Retirement Association (Association). These funds were used to finance the construction of facilities in the County, to finance certain equipment used by the Association in its operations, and to refund other debt held by the Association.

In March 2012, the County issued new conduit debt in the form of a fixed rate obligation held by Santa Barbara Bank & Trust. These funds were used to refund the Association’s 2004 COP obligations. This debt does not represent a liability of the County, as the County is not obligated in any manner for the debt. Accordingly, it is not reported as a liability in the accompanying financial statements. As of June 30, 2015, the conduit debt principal amount outstanding was $10,204.

79

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

11. LEASES
Operating Leases as Lessee

The following is a schedule of future minimum rental payments required under operating leases entered into by the County that have initial or remaining non‐cancelable lease terms in excess of one year as of June 30, 2015:

Year Ending June 30,

2016 2017 2018 2019 2020

Total minimum rental payments

Amount

$ 120 58 17 2 —

$ 197

Total rental expenditure/expense for the year ended June 30, 2015 was $3,176, of which $284 was recorded in the General Fund.

Operating Leases as Lessor

The County as lessor leases sections of the Casa Nueva building to both the Santa Barbara County Association of Governments and the Santa Barbara Air Pollution Control District under operating leases with terms from July 2003 through April 2034. The original cost of the Casa Nueva building was $6,168. As of June 30, 2015, the building had a carrying amount of $4,811, net of accumulated depreciation of $1,357.

The County as lessor also leases sections of the Public Health building known as the VA Clinic to the Veterans Administration under an operating lease with a term of October 2007 through September 2017. The original cost of the VA Clinic was $891. As of June 30, 2015, the building had a carrying amount of $316, net of accumulated depreciation of $575.

The following is a schedule of future minimum rentals to be received under operating leases entered into by the County as lessor that have initial or remaining non‐cancelable lease terms in excess of one year as of June 30, 2015:

Year Ending June 30,

2016
2017
2018
2019
2020 2021-2025 2026-2030 2031-2034

Amount

$ 591 595 383 312 312 1,561 1,561 1,196

$ 6,511

Total minimum rentals to be received
As of the year ended June 30, 2015, total rental income was $617 all of which was recorded in the General Fund.

80

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

11. LEASES ‐ CONTINUED Capital Leases

The County has entered into certain capital lease arrangements under which the related structures and equipment will become the property of the County when all terms of the lease agreements are met. The following is a schedule of future minimum capital lease payments, payable from the General Fund and certain special revenue funds, as of June 30, 2015:

Year Ending June 30,

2016
2017
2018
2019
2020 2021-2025 2026-2030

Total minimum lease payments Less: amount representing interest

Total present value of minimum lease payments

Governmental Activities
$ 485

485 445 406 302 991 298

3,412 (726)

$ 2,686

The following is a schedule of capital assets acquired through capital leases as of June 30, 2015:

Governmental Activities

Land $ Structures and improvements

1,283 3,611

4,894 (786)

4,108

Total capital assets, gross Less: accumulated depreciation

Total capital assets, net, under capital leases

$

Depreciation expense related to capital assets under capital leases for governmental activities was $238 for the year ended June 30, 2015.

12. CERTIFICATES OF PARTICIPATION (COP)

The Santa Barbara County Finance Corporation (Corporation), a public benefit corporation, was created to issue certificates of participation that are securities issued and marketed to investors. The certificates are sold to provide funds to the County to finance the costs of acquisition, installation and construction of capital projects. These certificates are secured by annual lease payments paid by the County to the Corporation and these lease payments are used by the Corporation to pay the interest and principal of the debt.

The certificates contain certain debt covenants, which are deemed by the County to be duties imposed by law. The County must include the applicable lease payments due each year in its annual budget and make the necessary appropriations. The County is also required to maintain certain levels of liability, property damage, casualty, business interruption, earthquake and title insurance in connection with each lease agreement. The County is in compliance with all significant financial restrictions and requirements as set forth in its various debt covenants.

81

Notes to the Financial Statements

12.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

CERTIFICATES OF PARTICIPATION (COP) ‐ CONTINUED

In FY 09‐10, the County issued $14,935 of taxable COP debt classified as Recovery Zone Economic Development Bonds (RZEDB) for purposes of the American Recovery and Reinvestment Act (ARRA). Pursuant to the ARRA, the County expects to receive a cash subsidy payment from the United States Treasury equal to 45% of the interest payable. The County received a subsidy of $389 during the current fiscal year.

Current Refunding

On December 17, 2014, the County current refunded its 2005 COP debt. The $11,080 liability was current refunded through the issuance of a private placement bond (see Note 13). The bonds were issued at a 2.33% interest rate, which is a 2.05% reduction form the average coupon rate of the 2005 COP debt. As a result of the refunding, the County obtained an economic gain (difference between present value of the debt service payments on the old debt and the new debt) of $1,163. The difference in the cash flow requirements to service the old debt of $12,302 and the cash flow requirements to service the new debt of $11,027 is $1,275.

A summary of COP principal outstanding as of June 30, 2015 is as follows:

Interest Rate %

4.00-4.75 3.00-5.00 6.22-6.25

3.00-4.50 3.00-5.00

Date of Issue

6/25/2008 6/10/2010 6/10/2010

6/25/2008 6/10/2010

Amount of Outstanding Original as of

Maturity Issue 6/30/2015

Governmental activities:

2008 Capital Improvements
2010 Capital Improvements
2010 Capital Improvements ‐ RZEDB

Sub‐total governmental activities

Business‐type activities:

2008 Capital Improvements 2010 Capital Improvements

Sub‐total business‐type activities Total COP principal outstanding

12/1/2028 12/1/2019 12/1/2040

12/1/2023 12/1/2019

$

$

17,000 884 14,935

32,819

6,625 2,821

9,446 42,265

$

$

14,220 528 14,935

29,683

4,315 1,682

5,997 35,680

82

Notes to the Financial Statements

12.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

CERTIFICATES OF PARTICIPATION (COP) ‐ CONTINUED

The following is a schedule of total COP debt service requirements to maturity as of June 30, 2015:

Governmental Activities

Business‐type Activities

Year Ending June 30,

Principal

Interest

1,563 1,528 1,492 1,454 1,414 6,027 3,839 2,284 1,014

30

20,645 —

20,645

Principal

$ 717 752 775 806 837 2,110 — — — —

5,997 64

$ 6,061

Interest

$ 231 203 175 145 110 191 — — — —

1,055 —

$ 1,055

2016 $ 883 2017 882 2018 935 2019 974 2020 1,008 2021-2025 7,751 2026-2030 8,130 2031-2035 3,725 2036-2040 4,420 2041-2045 975

Sub‐total 29,683

$

Unamortized premium Unamortized discount Total COP debt, net

$

14 (147)

29,550

$

13.

BONDS AND NOTES PAYABLE
Governmental Activities (Excluding Internal Service Funds)

Bonds Payable

On December 17, 2014 the County issued $9,925 of private placement bonds at an interest rate of 2.33% and used the proceeds to refund the County’s 2005 COP debt (see Note 12).

The bonds payable outstanding at June 30, 2015 is $19,325. The following is the repayment schedule as of June 30, 2015:

Year Ending June 30,

2016
2017
2018
2019
2020 2021-2025

Total bonds payable

Principal Interest

$ 2,555 $ 409 2,605 353 2,670 296 2,730 237 2,790 177 5,975 262

$ 19,325 $ 1,734

$

Total

2,964 2,958 2,966 2,967 2,967 6,237

$ 21,059

Internal Service Funds

Photovoltaic Solar Energy Facility Qualified Energy Conservation Bonds

On September 27, 2011, the County issued $5,250 of Qualified Energy Conservation Bonds (QECB) at an interest rate of 4.08% per annum. The proceeds were used to acquire a photovoltaic solar energy facility for the County’s Calle Real campus.

The QECBs are taxable bonds that entitle the issuer to receive a direct subsidy payment from the United States Treasury (Treasury) equal to the lesser of (i) the taxable rate of the bonds or (ii) 70% of the Qualified Tax Credit Bond (QTCB) Rate on every semi‐annual interest payment date. At the time of issuance, the QTCB Rate was 4.55%; therefore, the County will receive a Treasury subsidy of 70% of 4.55%, or approximately $1,395 over the life of the bonds, resulting in a true interest cost of 0.94%. These bonds will be repaid from the Utilities Fund.

83

Notes to the Financial Statements

13.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

BONDS AND NOTES PAYABLE ‐ CONTINUED

The Calle Real solar facility bonds payable outstanding at June 30, 2015 is $4,255. The following is the repayment schedule as of June 30, 2015:

Year Ending June 30,

2016 $ 2017
2018
2019

Principal Interest

335 $ 167 340 153 345 139 345 125 350 111

Total

$ 502 493 484 470 461 2,136 770

$ 5,316

2020
2021-2025 1,800 336 2026-2030 740 30

Total bonds payable $ 4,255

$ 1,061

Business‐Type Activities

Laguna Sanitation Wastewater Treatment Plant Note Payable

On August 16, 2001, the Laguna County Sanitation District (Laguna Sanitation) entered into a financing contract with the State of California (State) for the construction of a Total Dissolved Solids and Recycled Water Treatment Plant. Under the contract, the State made fifteen disbursements totaling $9,150 to Laguna Sanitation during the period of February 2002 through June 2003. Repayment of the note commenced in July 2004 and will continue through July 2023. Note payments are due on July 1st of each year; as such, these payments are regularly made in June of the prior fiscal year. The interest rate on the note is 2.40% per annum.

The note payable outstanding at June 30, 2015 is $4,286. The following is the repayment schedule as of June 30, 2015:

Year Ending June 30,

2016 $ 2017
2018
2019

Principal Interest

492 $ 103 504 91 516 79 529 67 541 54

1,704 82

Total

$ 595 595 595 596 595 1,786

$ 4,762

2020 2021- 2024

Total note payable

$

4,286

$ 476

Laguna Sanitation Qualified Energy Conservation Bonds

On May 25, 2011, the Laguna County Sanitation District (Laguna Sanitation) issued $4,170 of Qualified Energy Conservation Bonds (QECB) at an interest rate of 5.25% per annum. The proceeds were used to acquire a photovoltaic solar energy facility, which is projected to save the District $12,000 in financing, operating and maintenance costs over a 30 year period.

The QECBs are taxable bonds that entitle the issuer to receive a direct subsidy payment from the United States Treasury (Treasury) equal to the lesser of (i) the taxable rate of the bonds or (ii) 70% of the Qualified Tax Credit Bond (QTCB) Rate on every semi‐annual interest payment date. At the time of issuance, the QTCB Rate was 4.95%; therefore, the District will receive a Treasury subsidy of 70% of 4.95%, or $1,162 over the life of the bonds, resulting in a true interest cost of 1.97%.

84

Notes to the Financial Statements

13.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

BONDS AND NOTES PAYABLE ‐ CONTINUED

The Laguna Sanitation QECB bonds payable outstanding at June 30, 2015 is $3,176. The following is the repayment schedule as of June 30, 2015:

Year Ending June 30,

Principal Interest

Total

$ 428 419 410 396 386 1,797 328

$ 4,164

2016
2017
2018
2019
2020
2021-2025 1,495 302 2026-2030 316 12

$

Total bonds payable $ 3,176

265 $ 163 270 149 275 135 275 121 280 106

$ 988

14. SELF‐INSURANCE

The County is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; natural disasters; and medical malpractice. For these risks, the County has chosen to establish risk management internal service funds where assets are set aside for claim settlements associated with such risks of loss up to certain limits. In addition, the County has established separate self‐insurance financing funds for unemployment claims and dental insurance benefits for employees and their dependents.

For general liability, medical malpractice, and workers’ compensation claims, excess coverage is provided by the California State Association of Counties Excess Insurance Authority (Authority), a joint powers authority whose purpose is to develop and fund programs of excess insurance for its members, which include 93% of the counties in California and nearly 60% of the cities, as well as numerous school districts, special districts, housing authorities, fire districts, and other Joint Powers Authorities. A Board of Directors consisting of representatives from its members governs the Authority. The County’s aggregate annual premium, including property insurance, paid to the Authority for the year ended June 30, 2015, was $15,652. The Authority issues its own audited Comprehensive Annual Financial Report which can be obtained from the Authority located at 75 Iron Point Circle, Suite 200, Folsom, CA 95630.

The Authority retains financial responsibility for risk management claims in excess of the County’s self‐insurance retention. Self‐insurance and Authority limits are as follows:

Type of Coverage General Liability
Medical Malpractice** Workers’ Compensation*

Self‐Insurance Limit
$ 500 $ 500

$ –

$ $

Authority Limit

25,000

21,500

Statutory

*Effective July 1, 2010, the County obtained first dollar Workers’ Compensation coverage through The Authority’s Primary Workers’ Compensation program. Claims for injuries prior to that date are covered under the Authority’s Excess Insurance program.

**Effective October 1, 2014, the County obtained first dollar Medical Malpractice coverage through The Authority’s Primary Medical Malpractice program. Claims for injuries prior to that date are covered under the Authority’s Excess Insurance program.

The County purchases property insurance through the Authority from commercial insurance companies via a pool comprised of a majority of California counties and other California Public Agencies. The County is insured up to

85

Notes to the Financial Statements

14.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

SELF‐INSURANCE ‐ CONTINUED

$600,000 for All Risk coverage, and up to $490,000 for Flood and Earthquake coverages. All property damage risks are covered on a per occurrence basis and insured at full replacement values up to the policy limits. Deductibles per occurrence are $10 for fire or other property damage, and $25 for flood. The earthquake deductible is 5% of total values per separate building per occurrence, subject to a $100 minimum.

Settled claims have not exceeded insurance coverage in any of the past three fiscal years.

The unpaid claims liabilities included in the risk management self‐insurance internal service funds are based on the results of actuarial studies and include amounts for claims incurred but not reported and adjustment expenses. Claims liabilities are calculated considering the effects of inflation, recent claim settlement trends including frequency and amount of pay‐outs, and other economic and social factors. General liability, workers’ compensation, and medical malpractice liabilities are carried at present value using a discount rate of 1%. It is the County’s practice to annually obtain full actuarial studies for general liability, medical malpractice, and workers’ compensation coverages. Premiums are charged to departments using various allocation methods that include actual costs, trends in claims experience, and payroll costs. Premiums charged annually are established such that, when added with cash reserves on hand, adequate resources are provided to meet liabilities as they come due.

Changes in the claims liability for all self‐insurance claims during the past two fiscal years are as follows:

Unpaid claims, beginning of year Incurred claims
Claim payments
Unpaid claims, end of year

COMMITMENTS AND CONTINGENCIES Litigation

Fiscal Year Ended
June 30, 2014 June 30, 2015

$ 31,944 $ 28,417 7,135 4,765

(10,662) (8,940)

$ 28,417 $ 24,242

15.

The County is subject to various lawsuits and claims involving public liability and other actions incidental to the ordinary course of County operations. In the aggregate, these claims seek monetary damages in significant amounts. To the extent the outcome of such litigation has been determined to result in probable financial loss to the County, a liability for litigation of $203, representing County Counsel’s best estimate of the ultimate loss, has been accrued in the governmentwide Statement of Net Position. The timing of the payment of these losses cannot presently be determined.

A number of lawsuits and claims are pending against the County for which the financial loss to the County has been determined to be reasonably possible by County Counsel. These lawsuits include claims filed for inverse condemnation, tort liability, workers’ compensation, civil rights violation, breach of contract, land use disputes, and storm damage. These lawsuits are seeking damages in excess of $12,248. The County intends to vigorously defend itself against these lawsuits. The aggregate amount of the uninsured liabilities of the County and the timing of any anticipated payments which may result from such claims will not, in the opinion of County Counsel, significantly affect the financial condition of the County.

Grants

The County recognizes as revenue grant monies received as reimbursement for costs incurred in certain federal and state programs it administers. Although the County’s federal grant programs are audited in accordance with the requirements of the Federal Single Audit Act of 1997 and the related U.S. Office of Management and Budget

86

Notes to the Financial Statements

15.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

COMMITMENTS AND CONTINGENCIES ‐ CONTINUED

Circular A‐133, these programs may be subject to financial and compliance audits by the reimbursing agencies. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time, although the County expects such amounts, if any, to be immaterial, with the exception of the Alcohol, Drug, and Mental Health Services Fund.

Alcohol, Drug, and Mental Health Services (ADMHS) Fund

Counties provide mental health services to Medi‐Cal beneficiaries through a publicly or privately operated mental health managed care plan contracted with the State Department of Health Care Services (DHCS) and share in the financial risk. Each California County operates its own mental health plan for Medi‐Cal beneficiaries. The County, through the mental health plan, provides mental health services to adults and children directly and through Community Based Organizations (CBO).

Mental Health Medi‐Cal claiming is a reimbursement system in which counties are provided an interim cash flow of State and Federal funding pending a three step process of reimbursement that includes filing a cost report, settlement of valid units of service and a cost report audit. Funding is made available through the Federal Medicaid entitlement program and California provides matching State and County funds. Claims are reimbursed based upon the appropriate Federal Medical Assistance Percentage (FMAP). This percentage represents the percentage of a claim for which the Federal government will pay Federal Financial Participation (FFP). Any amounts not provided by FFP must be matched by State or County funds. The year‐end reporting process is the culmination of the mental health financial and statistical data accumulation for the services provided within the relevant Fiscal Year. The County is required to submit a cost report to DHCS by December 31 for all services provided by County and CBO staff for a fiscal year ending June 30. The cost report serves as a basis for computing the year‐end settlement of approved service units and a settlement payment between DHCS and the County and is also the basic standardized record subject to audit. All year‐end settlements are considered interim settlements and are subject to audit by DHCS. The audit is required to be completed three years after the year‐ end cost report is submitted and reconciled. Generally the cycle, from cost report submittal to final settlement, is not complete until five years after the initial cost report is filed by the County.

In past years this cost report settlement and audit process resulted in significant settlements with the State Department of Mental Health and now its successor agency DHCS. As reported to the County Board of Supervisors in May of 2015, the County currently estimates a potential liability exposure of up to $7.5 million for outstanding issues with the State dating back to FY 07‐08. The settlement and payment of these liabilities could span a five to ten year period. The County has identified sources to pay these liabilities that include a General Fund audit exception committed fund balance and ADMHS other long‐term liabilities payable.

Santa Barbara County Redevelopment Successor Agency

In accordance with Assembly Bill (AB) 1X 26 and AB 1434, all redevelopment agencies in the State of California were dissolved and ceased to operate as legal entities as of February 1, 2012. It is reasonably possible that the State Department of Finance could invalidate any of the obligations reported on the Successor Agency’s Recognized Obligations Payment Schedule. The range of potential loss of revenue to pay these obligations is between $0 and $20,000 over the remaining life of the Successor Agency (16 years).

Contracts

The County has entered into contracts to purchase goods and services from various vendors. Approximately $119,037 will be payable upon future performance under these contracts.

87

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

16. LANDFILLCLOSUREANDPOSTCLOSURE

The County owns and operates three landfill sites: Tajiguas, Foxen Canyon, and New Cuyama. Two of the three sites are closed ‐ New Cuyama closed in FY 95‐96; Foxen Canyon was converted to a transfer station in FY 03‐04 and subsequently closed in FY 08‐09.

State and federal laws and regulations require the County to place a final cover on these landfill sites when they stop accepting waste and to perform certain maintenance and monitoring functions at each site for thirty years after closure. Although closure and postclosure care costs will be paid only near or after the date that the respective landfill stops accepting waste, the County reports a portion of these closure and postclosure care costs as an operating expense in each period based on landfill capacity used as of each balance sheet date.

The $26,794 reported as landfill closure and postclosure care liability at June 30, 2015, represents the cumulative amount reported to date based on the estimated percentages of used capacity of the landfills as follows:

Landfill Tajiguas Foxen Canyon New Cuyama

Capacity Remaining
Used Years Years

Remaining Postclosure

82% 12 Open

95% closed 26 100% closed 16

The County will recognize the remaining estimated cost of closure and postclosure care of $5,263 as the remaining estimated capacity is filled. These amounts are based on what it would cost to perform all remaining closure and postclosure care in 2015. The County expects to close the Tajiguas landfill in the year 2026. Actual cost may be higher due to inflation, changes in technology, or changes in regulations.

The County is required by state and federal laws and regulations to make annual contributions and/or provide an alternative funding mechanism to finance closure and postclosure care. The County is in compliance with these requirements, and, at June 30, 2015, restricted cash and investments of $18,196 are held for these purposes. These are reported as restricted assets on the balance sheet (see Note 5).

Restricted cash for closure, postclosure and corrective action financial assurances costs at June 30, 2015 is comprised of the following:

Landfill Tajiguas Foxen Canyon New Cuyama

T ot al

Closure Cost

$ 14,240 — —

$ 14,240

Postclosure Corrective Cost Action Cost

Total Restricted Cash

$

$

1,038 $ 666 1,047 286 228 691

2,313 $ 1,643

$

$

15,944 1,333 919

18,196

Additionally, the County has pledged revenues from future tipping fees generated at the Santa Barbara South Coast Transfer Station to fund a portion of the postclosure maintenance costs. The County expects that future inflation costs will be paid from interest earnings on these annual contributions. However, if interest earnings are inadequate or additional postclosure care requirements are determined (due to changes in technology or applicable laws or regulations, for example), these costs may need to be covered through landfill tip fees and/or added program fees to the municipal refuse rates paid by county residents.

88

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

17. DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES

Pursuant to GASB Statement No. 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position,” and GASB Statement No. 65, “Items Previously Reported as Assets and Liabilities,” the County recognized deferred outflows of resources in the governmentwide and proprietary fund statements. These items are a consumption of net position by the County that is applicable to a future reporting period. Previous financial reporting standards do not include guidance for reporting those financial statement elements, which are distinct from assets and liabilities. The County has two items that are reportable on the Governmentwide Statement of Net Position: the first item relates to outflows from changes in the net pension liability (Note 21) and the second item relates to Social Services benefit payments that have met all requirements other than timing, the inflow of resources related to the benefit payments are reported as Advances from Grantors and Third Parties (Note 9). Deferred outflows of resources that are reported in the proprietary funds are included in the Governmentwide Statement of Net Position.

The County has one item that is reportable on the Governmental Fund Balance Sheet from Social Services benefit payments. These benefit payments are reported as deferred outflows of resources under the modified accrual basis of accounting as that have met all eligibility requirements other than timing.

Deferred outflows of resources balances for the year ended June 30, 2015 were as follows:

Governmentwide Deferred Outflows Governmental Activities

Social Services

Pensions
Total Governmental Activities Business‐type Activities

Pensions
Total Business‐type Activities

Total Governmentwide Deferred Outflows

Governmental Funds Deferred Outflows

Social Services Fund
Social Services
Total Governmental Fund Deferred Outflows

$

$

$ $

514 115,087 115,601

2,069

2,069 117,670

514 514

89

Notes to the Financial Statements

17.

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES ‐ CONTINUED

Pursuant to GASB Statement No. 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position,” and GASB Statement No. 65, “Items Previously Reported as Assets and Liabilities,” the County recognized deferred inflows of resources in the governmentwide, governmental fund, and proprietary fund statements. These items are an acquisition of net position by the County that is applicable to a future reporting period. Previous financial reporting standards do not include guidance for reporting those financial statement elements, which are distinct from assets and liabilities. The County has three items that are reportable on the Governmentwide Statement of Net Position: the first item relates to the assets and future installment payments of the Service Concession Arrangements (Note 8), the second item relates to the principal balance of the loans with a forgiveness clause included in the housing loan receivable amount (Note 6), and the last item relates to inflows from changes in the net pension liability (Note 21). Deferred inflows of resources that are reported in the proprietary funds are included in the Governmentwide Statement of Net Position.

Under the modified accrual basis of accounting, it is not enough that revenue is earned; it must also be available to finance expenditures of the current period. Governmental funds will therefore include additional deferred inflows of resources for amounts that have been earned but are not available to finance expenditures in the current period. The County has two items that are reportable on the Governmental Fund Balance Sheet: the first of these items relates to the total housing loan principal and interest receivable amount (Note 6) and the second relates to miscellaneous earned but unavailable revenue due to prior year Medi‐Cal Settlement payments (Note 6).

Deferred inflows of resources balances for the year ended June 30, 2015 were as follows:

Governmentwide Deferred Inflows Governmental Activities

Service Concession Arrangements Housing Loan Principal Payments Pensions

Total Governmental Activities

Business‐type Activities Pensions

Total Business‐type Activities
Total Governmentwide Deferred Inflows

Governmental Funds Deferred Inflows General Fund

Housing Loan Principal Payments Public Health Fund

Miscellaneous Unavailable Revenue Affordable Housing Fund

Housing Loan Payments
Total Governmental Fund Deferred Inflows

$

$

$

$

33,096 3,948 120,084

157,128

2,159

2,159 159,287

500

371

44,166 45,037

90

91

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

18. FUNDBALANCES

Fund balances are presented in the following categories: nonspendable, restricted, committed, assigned, and unassigned (see Note 1 for a description of these categories). A detailed schedule of fund balances at June 30, 2015 is as follows:

General

$ 7,442 Receivables 3,550 Prepaids/Deposits 50

Roads

$ — — —

Public Social
Health Services ADMHS

$ — $ — $ — — — — — — —

— — —

1,011 2,479 4,119 — — — 17,159 — — — — 1,033 — — 2,023 — — — — — — — — — — — — 880 125 67 — — — 954 — — — — — — 32 — — — — — — — — — — — — — — — — — — 749 — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 148 — — — — — — — — — — — — — — — — — — — — — — — — 9 1 4 — — — — 43 — — — — 3 15 5

20,016 2,695 8,148

Flood
Control Affordable District Housing

$ — $ — 52 — — —

52 —

54,289 4,797 13,206 — — — — — — — — — — — — — — — 201 12 — — — — — — — — — — — — — — — — — 852 — — — — — — — — — — — — — 391 — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 40 3 — — — — — — — —

67,736 6,055

Other Fire Govern‐ Protection Capital mental

District Projects Funds

Total Govern‐ mental Funds

$ 7,442 4,673 56

12,171

113,602 18,440 17,159

7,065 2,240 2,197 2,057 1,809 1,620 1,440 1,409 1,212 1,200 1,179 1,109 1,000

921 880 852 749 684 640 569 504 495 391 357 349 344 320 294 218 214 204 148 147 141 138 123 117 112 108 101

87 49 43 40 25

Nonspendable in form:

Teeter Tax Losses

$ — $ 1,039

— 1,039

8,458 1,632 — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 4 — — — —

— $ — — 32 — 6

— 38

— 20,242 — 726 — — — — — 217 — — — — — —

1,620 — — 155 — — — — — 1,200 — 1,008 — — — — — — — — — — — — — — — — — — — — 466 29 — — — — — — — — — — — — — — — — — 204 — — — — — — — — — — — — — — 24 84 — — 2 13 — — — — — — — 1

2,112 23,879

Total nonspendable fund balance

Restricted for:

Purpose of Fund
Allocated for Capital Outlay Health Care Programs
Local Realignment 2011 MHSA Prudent Reserve
P&D Offsite Mitigation
Public Safety Prop 172
Sheriff Categorical Grants DMV/Livescan
FY 12/13,13/14 Operating Plans Recorder Modernization
PHD Special Projects
Debt Service
Donations
Probation YOBG
Measure A Roads Funds Recorder Operations Probation LESF/COPS
Housing Trust Funds Alcoholism Programs Forfeiture Penalty
Los Prietos Donation Maintenance‐Casa Nueva Bldg Assessor AB818
COP Proceeds
State ‐ CDBG
Public Arts Program
Survey Monument
District Attorney Programs Gaviota Bikeway
Recorder Micrographics Weights and Measures Recorder Redaction
Dispute Resolution
Drug Abuse Programs
State Off Hwy Fee
Probation Programs
Vital Records
Recorder ERDS
Real Estate Fraud
CalVet Subvention Program Parks Projects Consumer/Environmental UnrealizedGains
Animal Control Programs
DSS Childrens Trust
DARE
ImprestCash

11,042 —

673 17,534 1 2,875 — — 6,032 — — — 2,197 — 2,057 — 1,809 — — — — — 1,409 — 258 — — — 139 — 1,109 — — 1,000 921 — 880 — — — — — 684 — 640 — 569 — 504 — — — — — 357 — 349 — 344 — 320 — 294 — 218 — 214 — — — — — 147 — 141 — 138 — 123 — 117 — 112 — — — 101 — — 11 49 — — — 40 — — 1

22,946 21,421

10,094

185,102

92

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

18. FUND BALANCES ‐ CONTINUED

A detailed schedule of fund balances at June 30, 2015 continued: Public Social

Flood Control District

— — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —

$ 67,788

Affordable Housing

— — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —

$ 6,055

Fire Protection District

— — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —

$ 11,133

Other Total Govern‐ Govern‐ Capital mental mental

Projects Funds Funds

— — 29,555

— — 7,900 3,008 2,501 7,355 — — 5,438 — — 3,541 — — 3,393 3,081 — 3,081 2,162 — 2,660 — — 2,000 965 — 1,842 — — 1,548 — — 1,037 — — 1,010 — — 982 — — 959 — — 916 — — 888 — — 883 — — 802 — — 794 — — 697 — — 684 — — 497 — — 490 213 — 414 — — 300 — — 221 — — 127 — — 117 — — 94 1 1 82 — — 68 — — 56 — — 40 — — 23 — — 21 — — 10 — — 4 — — —

9,430 2,502 80,529

— — 3,242

$ 11,542 $ 26,419 $ 281,044

Committed to:

Strategic Reserve New Jail Operations Purpose of Fund Health Care Programs Program Restoration Contingencies

SB 1022 Match
General Services Projects
Mental Health
Parks Projects
Auditor Systems Maint/Develop Clerk Record Assessor Projects Planning/Development Projects Audit Exceptions
Treas Tax Collector Projects Elections Voting Equipment Salary & Retirement Offset Litigation
North County Jail Contingency P&D Land Use System
FY 12/13,13/14 Operating Plans Human Resources Programs County Executive Programs General County Programs
Sheriff Projects
District Attorney Programs Public Defender Programs Rental Maintenance
Facilities Maintenance
Probation Programs
Unrealized Gains
Ag Commissioner Projects Maintenance‐Montecito Com Hall Building & Safety Permitting Imprest Cash
Housing Programs
Toxic Waste Monitoring Tobacco Settlement
Road Projects

Unassigned fund balance:

Totalfundbalances

General

29,555 7,900 581 — 3,541 3,393 — 498 2,000 877 1,548 1,037 1,010 982 959 916 888 883 802 794 697 684 497 490 201 300 221 127 117 94 77 68 56 40 23 21 10 — —

61,887

3,242

$ 99,117

Roads

— — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —

$ 21,421

Health Services ADMHS

— — — — — — — 1,265 —

5,438 — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —

3 — — — — — — — — — — — — — — — — — — — — 4 — — — — —

5,445 1,265 —

— — —

$ 25,461 $ 3,960 $ 8,148

93

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

19. RESTRICTEDCOMPONENTOFNETPOSITION

The restricted component of net position are assets that are subject to constraints either (1) externally imposed by creditors (such as debt covenants), grantors, contributors, or laws or regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.

The restricted component of net position at June 30, 2015 for governmental activities is as follows: Restricted for Public Safety:

Sheriff
Probation
Fire Protection District District Attorney Public Defender
Trial Courts

Restricted for Health & Public Assistance: Public Health
Social Services
First 5 Children and Families Commission Alcohol, Drug, and Mental Health Services Child Support Services

Restricted for Community Resources & Public Facilities: Flood Control District
Roads
Water Agency

Other
County Service Areas
Planning and Development Housing
Coastal Resources Enhancement

Restricted for General Government & Support Services: Clerk‐Recorder‐Assessor
General Services
Other

Restricted for General County Programs: Teeter Tax Losses
Other
Public and Educational Access

Criminal Justice and Courthouse Construction

Total restricted component of net position ‐ governmental activities

$

11,132 9,417 6,255 1,259

373 204

21,358 8,148 4,720 3,063

188

67,787 46,773 21,421 6,483 3,461 2,901 2,704 1,209

3,601 1,247 112

— 10,724 1,025 987

$

28,640

37,477

$

152,739

4,960

12,736 236,552

Included in governmental activities restricted net position at June 30, 2015 is net position restricted by enabling legislation of $5,770.

94

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

20. INTERFUND TRANSACTIONS Interfund Receivables / Payables

Amounts due to/from other funds at June 30, 2015 are as follows:

Payable Fund
Flood Control Districts
Social Services
General Fund
Affordable Housing
Public Health
Affordable Housing
Criminal Justice Construction

Amount

$ 1,129 1,008 554 435 258 90 41 $ 3,515

Receivable Fund General
General Alcohol,

Drug, & Mental Health Services

Roads General General General

Total due to/from other funds

The balances above are due to be paid in the subsequent fiscal year and resulted from when funds overdrew their share of pooled cash; or the time lag between the dates that 1) interfund goods and services are provided or reimbursable expenditures occur, 2) transactions are recorded in the accounting system, and 3) payments between funds are made.

Advances to/from other funds at June 30, 2015 are as follows:
Receivable Fund Payable Fund Amount

General Resource Recovery Enterprise

$ 1,760

The $1,760 advanced to the Resource Recovery enterprise fund represents the remaining balance of an initial $2,994 loan that provided financing resources for a landfill litigation settlement.

Transfers

Transfers are used to (1) move revenues from the fund required by statute or budget to collect them to the fund required by statute or budget to expend them, (2) move receipts identified for debt service from the funds collecting the receipts to the debt service fund as debt service payments become due, and (3) use unrestricted revenues collected in the General Fund to finance various programs accounted for in other funds in accordance with budgetary authorizations.

95

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

20. INTERFUND TRANSACTIONS ‐ CONTINUED

Transfers to/from other funds at June 30, 2015 are as follows:

Transfer From Transfer To Amount Purpose

General Fund

Nonmajor Governmental Funds Alcohol, Drug, & Mental Health Public Health Fund
Social Services Fund

Capital Projects Fund
Roads Fund
Alcohol, Drug, & Mental Health Nonmajor Governmental Funds Capital Projects Fund
Roads Fund
Fire Protection District Fund Fire Protection District Fund Social Services Fund
Internal Service Funds
Internal Service Funds
Capital Projects Fund
Capital Projects Fund
Alcohol, Drug, & Mental Health Capital Projects Fund
Public Health Fund
Nonmajor Governmental Funds

Capital Projects Fund

General Fund
Alcohol, Drug, & Mental Health Capital Projects Fund
Alcohol, Drug, & Mental Health Social Services Fund

General Fund
Internal Service Funds

$

9,182 General Fund 8,923 Other
7,029 General Fund 6,676 General Fund 4,200 General Fund 3,440 General Fund 3,066 General Fund 2,600 Debt Service 1,369 Other

Contribution

Contribution Contribution Contribution Contribution Contribution

Services Fund

Services Fund

Services Fund

Services Fund Services Fund

883 Other
398 General Fund 318 Reimbursement 313 Other
260 Other
249 Vehicles
236 Reimbursement 182 Capital Projects 122 Capital Projects 116 Vehicles

4 Other

1 Other 49,567

24 Capital Projects 24

2,271 Other 270 Other 198 Other

78 Capital Projects

14 Other 2,831

138 Other 74 Vehicles

212

Contribution

Roads Fund
Public Health Fund

Social Services Fund

96

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

20. INTERFUND TRANSACTIONS ‐ CONTINUED

Transfers to/from other funds at June 30, 2015 continued:

Transfer From Transfer To Amount Purpose

Alcohol, Drug, & Mental Health Services Fund

Flood Control District Fund Affordable Housing Fund

Fire Protection District

Capital Projects Fund

Nonmajor Governmental Funds

Internal Service Funds

Nonmajor Governmental Funds General Fund
Social Services Fund
Social Services Fund

Capital Projects Fund Internal Service Funds

Roads Fund
General Fund General Fund
Capital Projects Fund General Fund General Fund

Capital Projects Fund

General Fund
Internal Service Funds Nonmajor Governmental Funds General Fund
Public Health Fund

General Fund
Nonmajor Governmental Funds

Nonmajor Governmental Funds General Fund
General Fund
Fire Protection District Fund Capital Projects Fund

Flood Control Districts Fund Social Services Fund
Internal Service Funds
Capital Projects Fund Nonmajor Governmental Funds

General Fund
Public Health Fund Capital Projects Fund

Total transfers

540 Debt Service 281 Other

67 Other
48 Reimbursement 44 Other

980

37 Vehicles 37

674 Capital Projects
278 Program Administration 198 Other

89 Capital Projects
69 Capital Projects
32 General Fund Contribution 13 Program Administriation

1,353

2,414 Other
413 Vehicles
264 Debt Service
156 General Fund Contribution

11 Other 3,258

31 Other 10 Other 41

1,629 Debt Service 675 Reimbursement 386 Other
113 Other

62 Other
33 Other
28 Other
27 Vehicles
20 Capital Projects

2 Other 2,975

61 Other 18 Other

8 Vehicles 87

$ 61,365

97

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS
General Information about the Pension Plan

Plan Description

The County provides pension benefits to eligible employees through cost sharing multiple‐employer defined benefit pension plans (pension plans) administered by the Santa Barbara County Employees’ Retirement System (SBCERS). Members of the pension plans include all permanent employees working full time, or at least 50% part time for the County, and the following independent special districts: Carpinteria‐Summerland Fire Protection District, Mosquito and Vector Management District of Santa Barbara County, Goleta Cemetery District, Santa Maria Cemetery District, Oak Hill Cemetery District, Carpinteria Cemetery District, Summerland Sanitary District, Santa Barbara County Air Pollution Control District, Santa Barbara County Association of Governments, and the Santa Barbara County Superior Court. SBCERS issues a publicly available financial report that may be obtained at http://cosb.countyofsb.org/sbcers/default.aspx?id=19040.

SBCERS was established on January 1, 1944, and is administered by the Board of Retirement to provide service retirement, disability, death, and survivor benefits for employees of the County and participating districts. The Santa Barbara County Board of Supervisors and the governing boards of the participating districts adopt resolutions, as permitted by the California State Government Code §31450 (County Employees’ Retirement Law of 1937 (CERL)), which affect the benefits of the SBCERS members. SBCERS is governed by the California Constitution; CERL; and the bylaws, policies and procedures adopted by the SBCERS’ Board of Retirement.

SBCERS administers six County pension plans. With the passage of the Public Employees Pension Reform Act (“PEPRA”), the County established a new pension plan, Plan 8, with two rate tiers – one for safety and one for general members. As of January 1, 2013, Plan 8 is the only pension plan available to new employees. PEPRA made several changes to the pension benefits that may be offered to employees hired on or after January 1, 2013, including increasing minimum retirement ages, increasing the percentage required for member contributions, and excluding certain types of compensation as pensionable. PEPRA has also created limits on pensionable compensation tied to the Social Security taxable wage base. The cumulative effect of these PEPRA changes will ultimately reduce the County’s retirement costs.

98

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Summary of Plans and Eligible Participants

Open for New Enrollment:
General Plan 8 General members hired on or after January 1, 2013 may continue in plan.

Safety Plan 8 Safety members hired on or after January 1, 2013 may continue in plan. Closed to New Enrollment:

General Plan 2 General Plan 5A General Plan 5B General Plan 5C General Plan 7 Safety Plan 4A Safety Plan 4B Safety Plan 4C Safety Plan 6A Safety Plan 6B

Benefits Provided

Employees hired before January 11, 1999 may continue in plan. General members hired before October 10, 1994 may continue in plan.

General members hired on or after October 10, 1994 & in Bargaining Units 10, 11, 14, 15, 17, 35, 36, 40‐43 may continue in plan.
General members hired on or after October 10, 1994 & in Bargaining Units 21‐29, 32 may continue in plan.

General members hired on or after June 25, 2012 may continue in plan. Firefighters hired before October 10, 1994 may continue in plan.

(a) Probation safety managers, and (b) Fire Chief hired on or after October 10, 1994 may continue in plan.

(a) Non‐management Probation safety employees, and (b) Firefighters hired on or after October 10, 1994 (except Fire Chief) may continue in plan.

Sheriff/District Attorney safety members hired before October 10, 1994 may continue in plan.

Sheriff/District Attorney safety members hired on or after October 10, 1994 may continue in plan.

All pension plans provide benefits, in accordance with CERL regulations, upon retirement, disability or death of members. Retirement benefits are based on years of service, final average compensation, and retirement age. Employees terminating before accruing 5 years (or 10 years for Plan 2) of retirement service credit (5 or 10‐year vesting) forfeit the right to receive retirement benefits unless they establish reciprocity with another public agency within the prescribed time period. Non‐vested employees who terminate service are entitled to withdraw their accumulated contributions plus accrued interest. Employees who terminate service after earning 5 or 10 years of retirement service credit may leave their contributions on deposit and elect to take a deferred retirement. Differences between expected or actual experience for vested and non‐vested benefits may result in an increase or decrease to pension expense and net pension liability.

Service related disability benefits are based upon final average compensation or retirement benefits (if eligible). Non‐service related disability benefits are based on 1) years of service and final average compensation or 2) retirement benefits (if eligible). General Plan 2 participants receive disability benefits through a long‐term insurance policy. Death benefits are based upon a variety of factors including whether the participant was retired or not.

99

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Annual cost‐of‐living adjustments (COLAs) after retirement are provided in all plans except General Plan 2. COLAs are granted to eligible retired members each April based upon the Bureau of Labor Statistics Average Consumer Price Index (CPI) for All Urban Consumers for the Los Angeles‐Riverside‐Orange County area as of the preceding January 1 and is subject to an annual maximum dependent upon the provisions of the pension plans.

Specific details for the retirement, disability or death benefit calculations and COLA maximums for each of the pension plans are available in the SBCERS’ Comprehensive Annual Financial Report (CAFR). The SBCERS’ CAFR is available online at http://cosb.countyofsb.org/sbcers/default.aspx?id=19040.

Contributions

Per Article 16 of the Constitution of the State of California, contribution requirements of the active employees and the participating employers are established and may be amended by the SBCERS Board of Retirement. Depending upon the applicable plan, employees are required to contribute a certain percent of their annual pay. For each of the plans, the County’s contractually required contribution (formerly known as the actuarially required contribution (ARC)) rate for the year ended June 30, 2015, was a specified percent of annual payroll, actuarially determined as an amount that, when combined with employee contributions, is expected to finance the costs of benefits earned by employees during the year. Additional amounts required to finance any unfunded accrued liability are the responsibility of the plan sponsors. Contributions to the pension plan from the County were $114,946 for the year ended June 30, 2015. Active members are plan members who are currently accruing benefits and/or paying contributions into the applicable plan.

Employer and employee contribution rates and active members for each plan are as follows:

Employer

Employee Contribution Rates

Active Members

Contribution General Plan 2 20.84% General Plan 5A 31.98% General Plan 5B 32.40% General Plan 5C 33.46%

General Plan 7 31.41% General Plan 8 25.84% Safety Plan 4A 53.14% Safety Plan 4B 52.25% Safety Plan 4C 52.96% Safety Plan 6A 59.47% Safety Plan 6B 59.37% Safety Plan 8 42.64%

Rates

Non‐contributory 9 2.60 – 5.37% 520 5.19 – 10.73% 242

2.50 – 5.35%
2.08 – 4.46% 94

7.00% 603 4.83 – 8.50% 40 9.66 – 17.01% 13

4.63 – 8.43% 339 4.83 – 8.50% 89 4.63 – 8.43% 310

13.25% 106

1,572

100

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2015, the County reported a liability of $565,460 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2014 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The County’s proportion of the net pension liability was based on a projection of the County’s long‐term share of contributions to the pension plan relative to the projected contributions of all Pension Plan participants, actuarially determined. At June 30, 2014, the County’s proportion was 92.6470%, which was an increase of 0.3145% from its proportion measured as of June 30, 2013.

For the year ended June 30, 2015, the County recognized pension expense of $74,477. Pension expense represents the change in the net pension liability during the measurement period, adjusted for actual contributions and the deferred recognition of changes in investment gain/loss, actuarial gain/loss, actuarial assumptions or method, and plan benefits. At June 30, 2015, the County reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows of Resources

Deferred Inflows of Resources $-

– 122,243

– $ 122,243

Differences between expected and actual experience Changes in assumptions

Net difference between projected and actual earnings on retirement plan investments

Changes in proportion and differences between County contributions and proportionate share of contributions

County contributions subsequent to the measurement date

$

$

– – –

2,211 114,945

117,156

Deferred outflows of resources and deferred inflows of resources above represent the unamortized portion of changes to net pension liability to be recognized in future periods in a systematic and rational manner.

$114,946 reported as deferred outflows of resources related to pensions resulting from County contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2016.

Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ending June 30,

2016
2017
2018
2019
2020 Thereafter

$

Amount

(30,018) (30,018) (30,018) (30,017)

39 —

$

(120,032)

101

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Actuarial Assumptions

The total pension liability in the June 30, 2014 actuarial valuation was determined using the following actuarial assumptions. Total pension liability represents the portion of the actuarial present value of projected benefit payments attributable to past periods of service for current and inactive employees.

Inflation
Amortization growth rate Salary increases
COLA increases Investment rate of return Post‐Retirement mortality

3.00%

3.50%

3.50% plus merit component

2.75% for those with a 3.00% COLA cap; 2.00% for those with a 2.00% COLA cap

7.50%, net of investment expense

Sex distinct RP‐2000 Combined Mortality, projected with generational improvements using Scale BB

The actuarial assumptions used in the June 30, 2014 valuation were based on the results of an actuarial experience study for the period July 1, 2010 through June 30, 2013. Based upon the results of the 2013 actuarial experience study, there were no changes to the assumptions from the prior valuation.

The long‐term expected rate of return on pension plan investments (7.5 percent) was determined using a building‐block method in which best‐estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long‐term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

102

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Asset Class
Domestic equity
Investment grade bonds Emerging market non‐U.S. equity Developed market non‐U.S. equity Private equity
Tips
Private real estate
High yield bonds
Foreign bonds
Emerging market bonds
Natural resources (private) Commodities
Bank loans
Infrastructure (private) Infrastructure (public)
Natural resources (public)
Real Estate Investment Trusts Frontier market equity
Cash
Small cap

Total

Discount Rate

The discount rate used to measure the total pension liability was 7.5 percent. The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at the current contribution rate and that contributions from the County will be made at contractually required rates, actuarially determined. Based on those assumptions, the pension fund’s fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees. In theory, the discount rate may differ from the long‐term expected rate of return discussed previously. However, based on the projected availability of the pension fund’s fiduciary net position, the discount rate is equal to the long‐term expected rate of return on pension plan investments, and was applied to all periods of projected benefit payments to determine the total pension liability.

Target Allocation

23% 10% 10% 9% 7% 7% 6% 4% 4% 3% 3% 3% 2% 2% 2% 2% 2% 1% 0% 0% 100%

Long‐term Expected Real Rate of Return

5.40% 0.70% 8.80% 6.00% 7.20% 0.40% 4.00% 3.60% -0.30% 3.50% 6.40% 2.20% 2.40% 4.50% 5.60% 6.10% 4.00% 7.60% -0.20% 0.00%

103

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

21. PENSIONS ‐ CONTINUED

Sensitivity of the County’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate

The following presents the County’s proportionate share of the net pension liability calculated using the discount rate of 7.5 percent, as well as what the County’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1‐percentage point lower (6.5 percent) or 1‐percentage point higher (8.5 percent) than the current rate:

County’s proportionate share of the net pension plan liability

Pension fund fiduciary net position

1% Decrease 6.50%

$ 975,563

$

Discount Rate 7.50%

565,460

$

1% Increase 8.50%

230,681

Detailed information about the pension fund’s fiduciary net position is available in the separately issued SBCERS CAFR.

22. OTHERPOSTEMPLOYMENTBENEFITS(OPEB) Plan Description

The County’s agent multiple‐employer defined benefit postemployment healthcare plan (OPEB Plan) is administered by the Santa Barbara County Employees’ Retirement System (SBCERS). The OPEB Plan provides medical benefits to eligible retired County and other employer plan sponsors’ employees, as well as to their eligible dependents, pursuant to California Government Code Section 31694 et. seq. Other employer plan sponsors include the Carpinteria‐Summerland Fire Protection District, Goleta Cemetery District, Santa Maria Cemetery District, Carpinteria Cemetery District, Summerland Sanitary District, Santa Barbara County Air Pollution Control District, Santa Barbara County Association of Governments, and the Santa Barbara County Superior Court.

In September 2008, the County and SBCERS adopted an Internal Revenue Code (IRC) Section 401(h) account that provides for these benefits. Under GASB Statement No. 43 (GASB 43), “Reporting for Postemployment Benefit Plans Other Than Pension Plans,” and GASB Statement No. 45 (GASB 45), “Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions,” the liability related to the plan is required to be determined for both retirement systems and employers. GASB 43 and GASB 45 are not limited to the reporting of vested benefits.

SBCERS issues its own Comprehensive Annual Financial Report which includes note disclosures and required supplementary information for the OPEB Plan. This may be obtained by writing to the Santa Barbara County Employees’ Retirement System at 3916 State St. Suite 210, Santa Barbara, CA 93105 or online at http://cosb.countyofsb.org/sbcers/default.aspx?id=19040.

Plan Benefits

The County negotiates healthcare contracts with providers for both its active employees and the participating retired members of SBCERS. Retirees are offered the same health plans as active County employees, as well as enhanced senior plans for retirees on Medicare. Retiree premiums are rated separately from active County employees; as such, the County does not have a retiree premium implicit rate subsidy.

104

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

22. OTHER POSTEMPLOYMENT BENEFITS (OPEB) ‐ CONTINUED

Pursuant to the OPEB Plan, the Board of Supervisors has determined to provide a monthly insurance premium subsidy of $15 (whole dollars) per year of credited service from the 401(h) account for Eligible Retired Participants participating in a County‐sponsored health insurance plan. The monthly insurance premium subsidy is applied directly by SBCERS to pay the premium and is not paid to the retiree or other party. The maximum amount paid in any month does not exceed the premium; any amount in excess of the premium is forfeited. If an Eligible Retired Participant does not participate in the County‐sponsored health insurance plan, then SBCERS reimburses the Eligible Retired Participant for other medical care expenses. The maximum monthly amount paid is $4 (whole dollars) per year of credited service.

If a member is eligible for a disability retirement benefit, the member can receive a monthly health plan subsidy of $187 (whole dollars) per month or a subsidy of $15 (whole dollars) per month per year of service, whichever is greater. This subsidy is treated as a nontaxable amount to the disabled recipient.

Survivors of Eligible Retired Participants (i.e., spouses and dependents) continue to receive a subsidy proportionate to their percentage of the retiree’s pension benefit (if any).

Funding Policy

The County and other participating employer plan sponsors individually determine their separate contributions to SBCERS to fund the OPEB Plan. The County has adopted an employer contribution rate of 3.50% of covered retiree payroll.

Annual OPEB Cost and Net OPEB Obligation

The County’s annual OPEB cost is calculated based on the annual required contribution (ARC) of the employer, an amount actuarially determined within the parameters of GASB 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and to amortize, over fifteen years, any unfunded actuarial accrued liabilities (UAAL) which consist of current retirees, current vested terminated and current active employees.

For the year ended June 30, 2015, the OPEB ARC was $29,424 or 11.13% of the County’s estimated annual covered payroll. This includes the normal cost of $4,400 for the year for current active employees, and $25,024 for UAAL amortization. The County’s contribution to the OPEB Plan for the year ended June 30, 2015 was $9,081.

The following are the components of the County’s annual OPEB cost for the year ended June 30, 2015:

Annual required contribution (ARC) Interest on net OPEB obligation Adjustment to ARC

Annual OPEB cost (expense) Contributions made

Increase in net OPEB obligation
Net OPEB obligation ‐ beginning of year Net OPEB obligation ‐ end of year

$

$

29,424 3,408

(6,751)

26,081 (9,081)

17,000 74,693 91,693

105

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

22. OTHER POSTEMPLOYMENT BENEFITS (OPEB) ‐ CONTINUED

The County’s annual OPEB cost, the percentage of annual OPEB cost contributed to the OPEB Plan, and the net OPEB obligation for the current year and the two preceding years, are as follows:

Fiscal Year Ended

6/30/2013 6/30/2014 6/30/2015

Annual OPEB Cost

Percentage of Annual OPEB Cost Contributed 44%
42%
35%

Net OPEB Obligation

$

20,827 20,078 26,081

$

63,013 74,692 91,693

The quantification of costs set forth above should not be interpreted in any way as vesting such benefits; rather the disclosures are made solely to comply with the County’s reporting obligations under GASB 45, as the County understands these obligations.

Funded Status and Funding Progress

Using the most recent actuarial valuation dated June 30, 2014, the following is the funded status of the OPEB Plan:

Actuarial accrued liability (AAL)
Actuarial value of plan assets
Unfunded actuarial accrued liability (UAAL)

Funded ratio (actuarial value of plan assets/AAL) Covered payroll (active plan members)
UAAL as percentage of covered payroll

$ 178,462 (3,155)

$ 175,307 1.8%

$ 264,376 66.3%

Actuarial valuations of an ongoing OPEB Plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the OPEB Plan and the ARC of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The Schedule of Funding Progress for the County’s OPEB is presented as required supplementary information following the Notes to the Financial Statements. This schedule presents multiyear trend information that shows whether the actuarial value of OPEB Plan assets is increasing or decreasing over time relative to the AAL for benefits.

Actuarial Methods and Assumptions

Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation as well as the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce short‐term volatility in actuarial accrued liabilities and the actuarial value of assets (if any), consistent with the long‐term perspective of the calculations.

In the County’s June 30, 2014 actuarial valuation, the entry age normal actuarial cost method was used. The actuarial assumptions included a 4.33% investment rate of return (net of investment expenses), and an inflation assumption of 3.50%. The actuarial value of assets was determined using the market value of the assets as of the valuation date. The OPEB Plan’s UAAL is being amortized as a level percentage of projected payroll on a closed basis. A closed amortization period of 15 years was established as of January 1, 2007. The remaining amortization period at June 30, 2015 was 7.5 years.

106

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

23. DEFERRED COMPENSATION PLANS
Santa Barbara County Supplemental Retirement Plan

The Santa Barbara County Supplemental Retirement Plan is an employer discretionary, defined contribution plan established and governed under Internal Revenue Code Section 401(a). Employer‐only annual contributions are calculated based upon a percentage of employee compensation under annual agreements with employee bargaining groups and unions.

This plan is administered through a third‐party administrator and is available to all employee groups. The County does not perform the investing function and has no fiduciary accountability for the plan. Thus, plan assets and any related liability to plan participants have been excluded from the County’s financial statements.

The County’s actual contributions for the current year and the two preceding years are as follows:

Fiscal Year Ended

6/30/2013 6/30/2014 6/30/2015

Contributions

$ 161 169 181

County of Santa Barbara Employee Contribution Deferred Compensation Plan

The County offers to its employees an optional deferred compensation plan created in accordance with Section 457 of the Internal Revenue Code. This plan is available to substantially all employees and allows participants to defer a portion of their current income until future years, up to a maximum of $18,000 (in whole dollars) per calendar year, so as to shelter such funds and earnings from state and federal taxation until withdrawal. The deferred compensation is not available to participants until termination, retirement, death, or unforeseeable emergency.

This plan is administered through a third‐party administrator. The County does not perform the investing function and has no fiduciary accountability for the plan. Thus, plan assets and any related liability to plan participants have been excluded from the County’s financial statements.

County of Santa Barbara Social Security Compliance Deferred Compensation Plan

The Social Security Compliance Deferred Compensation Plan is a supplemental retirement program utilized by the County in lieu of payments to Social Security (FICA), governed under Internal Revenue Code Sections 3121 and 457. Enrollment in this plan is mandatory for contract, extra‐help, seasonal and temporary employees. Employees enrolled in the regular SBCERS pension plans are not eligible for this plan. Based upon the employee’s gross compensation, the employee’s deferral, on a before‐tax basis, equals 6.0% and the County’s contribution equals 1.5% for a combined total of 7.5%.

This plan is administered through a third‐party administrator and is available to all employee groups. The County does not perform the investing function and has no fiduciary accountability for the plan. Thus, plan assets and any related liability to plan participants have been excluded from the County’s financial statements.

The County’s actual contributions for the current year and the two preceding years are as follows:

Fiscal Year Ended

6/30/2013 6/30/2014 6/30/2015

Contributions

$ 111 109 149

107

Notes to the Financial Statements

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015 ~ in thousands

24. PRIOR PERIOD ADJUSTMENT

A prior period adjustment of $965 was made to decrease the governmental activities’ beginning net position. The adjustment was made due to prior period costs related to capital outlay projects that were incorrectly classified.

A prior period adjustment of $600,376 was made to decrease the governmental activities’ beginning net position. The adjustment was made to reflect the prior period costs related to the implementation of the net pension liability.

The restatement of beginning net position of the governmental activities is summarized as follows:

Governmental activities
Net position at July 1, 2014, as previously stated

Work in progress prior period adjustment

Net pension liability adjustment Net position at July 1, 2014, as restated

$ 819,967 (965) (600,376)

$ 218,626

A prior period adjustment of $10,639 was made to decrease the business‐type activities’ beginning net position. The adjustment was made to reflect the prior period costs related to the implementation of the net pension liability.

The restatement of beginning net position of the business‐type activities is summarized as follows:

Business‐type activities
Net position at July 1, 2014, as previously stated

Net pension liability adjustment Net position at July 1, 2014, as restated

$ 95,753 (10,639)

$ 85,114

108

REQUIRED SUPPLEMENTARY INFORMATION

109

COUNTY OF SANTA BARBARA, CALIFORNIA
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

SANTA BARBARA COUNTY EMPLOYEES’ RETIREMENT SYSTEM ‐ SCHEDULE OF THE COUNTY’S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY

Last 10 Fiscal Years*

SANTA BARBARA COUNTY EMPLOYEES’ RETIREMENT SYSTEM ‐ SCHEDULE OF THE COUNTY’S CONTRIBUTIONS

Last 10 Fiscal Years*

Actuarially determined contribution
Contributions in relation to the actuarially determined contribution Contribution deficiency (excess)

County’s covered‐employee payroll
Contributions as a percentage of covered‐employee payroll

FY 2014

$ 110,461 110,756

$ (295)

$ 283,430 39.08%

FY 2014

FY 2013

92.3325% 721,772 277,298

260.30% 73.66%

County’s proportion of the net pension liability (asset)
County’s proportionate share of the net pension liability (asset)
County’s covered‐employee payroll
County’s proportionate share of the net pension liability (asset) as
a percentage of its covered‐employee payroll
Plan fiduciary net position as a percentage of the total pension
liability
*Amounts presented above were determined as of 6/30. Additional years will be presented as they become available.

$ $

$ $

92.6470% 565,460 283,430

199.50% 80.46%

*Amounts presented above were determined as of 6/30. Additional years will be presented as they become available.

OTHER POSTEMPLOYMENT BENEFITS (OPEB) PLAN ‐ SCHEDULE OF FUNDING PROGRESS

Actuarial Valuation Date

Actuarial Value of Assets (a)

Entry Age Actuarial Accrued Liability (AAL)
(b)

Unfunded AAL

Covered Payroll (c)

UAAL
as a Percentage of Covered Payroll ((b ‐ a) / c)

56.0% 57.6% 61.4% 62.8% 66.3%

12/31/2006 $ 6/30/2009 6/30/2010

6/30/2012 6/30/2014

– 1,041 1,875 2,478 3,155

$

132,082 161,999 173,944 176,405 178,462

$

(UAAL) Funded Ratio (b ‐ a) (a / b)

132,082 0.0% 160,958 0.6% 172,069 1.1% 173,927 1.4% 175,307 1.8%

$

235,810 279,494 280,040 276,879 264,376

See accompanying independent auditor’s report.

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION

  1. This information is intended to help users assess the County’s OPEB plan’s status on a going‐concern basis, assess progress made in accumulating assets to pay benefits when due, and make comparisons with other public employers.
  2. The information presented relates solely to the County and not Santa Barbara County Employees’ Retirement System as a whole.

110

GOVERNMENTAL FUNDS – GENERAL AND MAJOR SPECIAL REVENUE

111

112

COUNTY OF SANTA BARBARA, CALIFORNIA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

200,488 14,297 4,794 3,583 79,629 62,665 4,663 370,119

16,131 208,037 10,111 44,371 50,453 3,177 332,280

37,839

7,355 (50,697)

— (43,342)

(5,503)

92,806 87,303

Actual Amounts

204,311 13,038 5,577 3,094 77,900 61,626 4,547 370,093

15,563 206,076 9,908 39,434 47,157 3,090 321,228

48,865

6,990 (49,567)

23 (42,554)

6,311

92,806 99,117

Variance with Final Budget

Revenues

Taxes $ 199,549 Licenses, permits, and franchises 14,346 Fines, forfeitures, and penalties 4,426 Use of money and property 1,927 Intergovernmental 68,716 Charges for services 61,800 Other 3,320

$

$

$

3,823 (1,259)

783 (489) (1,729) (1,039) (116) (26)

568 1,961 203 4,937 3,296 87 11,052

11,026

(365) 1,130 23 788

11,814

— 11,814

Total revenues

Expenditures

Current:
Policy & executive
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs

Total expenditures

Excess of revenues over expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets

Total other financing uses
Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

354,084

15,970 204,078 9,915 42,700 51,454 2,746 326,863

27,221

4,798 (33,676)

— (28,878)

(1,657)

92,806 91,149

$

$

$

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

113

COUNTY OF SANTA BARBARA, CALIFORNIA
ROADS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

7,392 252 71 22,579 365 75 30,734

41,749 41,749

(11,015)

7,595 (2,530)

— 5,065

(5,950)

21,590 15,640

Actual Amounts

7,515 453 117 19,420 646 210 28,361

33,600 33,600

(5,239)

4,997 (24)

97 5,070

(169)

Variance with Final Budget

Revenues

Taxes
Licenses, permits, and franchises Use of money and property Intergovernmental
Charges for services
Other

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$ 7,383 252 60 22,614 3,963 75 34,347

$

$

$

123 201 46

(3,159) 281 135

(2,373)

8,149 8,149

5,776

(2,598) 2,506 97 5

5,781

$

43,566 43,566

(9,219)

4,680 (1,208)

— 3,472

(5,747)

21,590 15,843

$

$

21,590 — 21,421 $ 5,781

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

114

COUNTY OF SANTA BARBARA, CALIFORNIA
PUBLIC HEALTH SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Actual Amounts

$ 42 656 111 19,985 41,380 4,018 66,192

Variance with Final Budget

Revenues

Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental

Charges for services Other

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in Transfers out

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

45 679 52 18,898 34,681 3,887 58,242

67,592 67,592

(9,350)

10,121 (3,600) 6,521

(2,829)

22,909 20,080

Final

$ 45 679 75 19,533 38,896 4,121 63,349

$

(3) (23) 36

452 2,484

(103) 2,843

1,687 1,687

4,530

(662) 718 56

4,586

— 4,586

$

$

69,558 69,558

(6,209)

7,724 (3,549) 4,175

(2,034)

22,909 20,875

$

67,871 67,871

(1,679)

7,062 (2,831) 4,231

2,552

22,909 25,461

$

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

115

COUNTY OF SANTA BARBARA, CALIFORNIA
SOCIAL SERVICES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Actual Amounts

$ 80 5 200 144,380 905 145,570

Variance with Final Budget

$ 14 (8)

Revenues

$ 66 13 302 Intergovernmental 149,587 Other 742

Final

$ 66 13 303 150,336 784 151,502

Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property

(103) (5,956)

121 (5,932)

7,630 7,630

1,698

5 39 44

1,742

— 1,742

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in Transfers out

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

150,710

159,066 159,066

(8,356)

6,761 (99)

6,662

(1,694)

3,452 1,758

$

159,626 159,626

(8,124)

7,141 (251)

6,890

(1,234)

3,452 2,218

$

151,996 151,996

(6,426)

7,146 (212)

6,934

508

3,452 3,960

$

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

116

COUNTY OF SANTA BARBARA, CALIFORNIA
ALCOHOL, DRUG, AND MENTAL HEALTH SERVICES (ADMHS) SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Original

Final Amounts

$4 $3

Revenues

Fines, forfeitures, and penalties $
Use of money and property
Intergovernmental 45,353 Charges for services 50,382 Other 262

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

$

57 46,972 41,964 435 89,432

105,493 105,493

(16,061)

14,220 (2,524)

— 11,696

(4,365)

7,352
2,987 $

164 48,232 32,514 463 81,376

92,060 92,060

(10,684)

12,459 (980)

1 11,480

796

7,352 8,148

$

4 53

96,054

103,617 103,617

(7,563)

4,595 (2,187)

— 2,408

(5,155)

7,352 2,197

$

(1) 107 1,260

(9,450) 28

(8,056)

13,433 13,433

5,377

(1,761) 1,544 1

(216) 5,161

— 5,161

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

117

COUNTY OF SANTA BARBARA, CALIFORNIA
FLOOD CONTROL DISTRICT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

8,926 225 1,661 3,535 38 14,385

21,601 21,601

Actual Amounts

9,679 318 1,223 3,573 39 14,832

9,682 9,682

Variance with Final Budget

Revenues

Taxes $ 8,918 Use of money and property 185 Intergovernmental 5,257 Charges for services 3,360 Other 38

$

$

$

753 93 (438) 38

1 447

11,919 11,919

12,366

— 58 106 164

12,530

— 12,530

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Excess (deficiency) of revenues over (under) expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets

Total other financing sources (uses) Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

17,758

25,047 25,047

(7,289)

33 (1) 60

92 (7,197)

62,476 55,279

$

(7,216) 5,150

33 33 (95) (37) 60 166 (2) 162

(7,218) 5,312

62,476 62,476 55,258 $ 67,788

$

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

118

COUNTY OF SANTA BARBARA, CALIFORNIA
AFFORDABLE HOUSING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Actual Amounts

$ 33 2,878 144 3,283 6,338

3,740 3,740

2,598

(1,353) (1,353)

1,245

Variance with Final Budget

$ 16 (1,674)

16 136

(1,506)

1,078 1,078

(428)

164 164

(264)

Revenues

Use of money and property Intergovernmental Charges for services
Other

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Excess of revenues over expenditures

Other financing uses

Transfers out
Total other financing uses

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

13 3,930 53 2,016 6,012

5,037 5,037

975

(855) (855)

120

Final

$ 17 4,552 128 3,147 7,844

4,818 4,818

3,026

(1,517) (1,517)

1,509

$

4,810
4,930 $ 6,319 $ 6,055 $ (264)

4,810

4,810

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

119

COUNTY OF SANTA BARBARA, CALIFORNIA
FIRE PROTECTION DISTRICT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

42,232 20 8 4,043 15,041 440 61,784

59,315 59,315

2,469

830 (3,404)

— (2,574)

(105)

8,239 8,134

Actual Amounts

43,209 20 28 3,440 16,210 410 63,317

58,054 58,054

5,263

829 (3,258)

60 (2,369)

2,894

8,239 11,133

Variance with Final Budget

Revenues

Taxes
Licenses, permits, and franchises Use of money and property Intergovernmental
Charges for services
Other

Total revenues

Expenditures

Current: Public safety

Total expenditures

Excess of revenues over expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets

Total other financing uses
Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

41,456 20 — 4,043 13,722 54 59,295

57,833 57,833

1,462

829 (2,726)

— (1,897)

(435)

8,239 7,804

$

$

$

977 — 20

(603) 1,169

(30) 1,533

1,261 1,261

2,794

(1) 146 60 205

2,999

— 2,999

$

$

$

$

Budgets are prepared on the modified accrual basis of accounting consistent with GAAP.

120

OTHER SUPPLEMENTARY INFORMATION

121

122

OTHER MAJOR GOVERNMENTAL FUNDS

123

COUNTY OF SANTA BARBARA, CALIFORNIA
CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Actual Amounts

$ 27 1,020 193 2,006 3,246

Variance with Final Budget

$4 (1,171) (819) (739) (2,725)

Revenues

Use of money and property Intergovernmental Charges for services
Other

Total revenues

Expenditures

Current:
Public safety
Community resources & public facilities General government & support services

Capital outlay
Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in Transfers out

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

— 1,368 803 1,912 4,083

2,654 — — 6,603 9,257

(5,174)

2,303 (1,263) 1,040

(4,134)

11,092 6,958

Final

$ 23 2,191 1,012 2,745 5,971

$

$

826 65 83 14,070 15,044

(9,073)

7,551 (45)

7,506

(1,567)

11,092 9,525

$

825 65 73 8,353 9,316

(6,070)

6,561 (41)

6,520

450

11,092 11,542

$

1

— 10 5,717 5,728

3,003

(990) 4

(986) 2,017

— 2,017

124

NONMAJOR GOVERNMENTAL FUNDS

125

Nonmajor Governmental Funds

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

SPECIAL REVENUE FUNDS

Special Revenue Funds are established to finance particular governmental activities and are financed by specific taxes or other revenues. Such funds are authorized by statutory provisions to pay for certain activities of a continuing nature. Included in the Special Revenue classification are the following funds:

First 5 Children and Families Commission

As required by Proposition 10, the First 5 Children and Families Commission Fund accounts for the revenues generated by a tax on cigarettes and tobacco products. Proposition 10 revenues are deposited into the First 5 Children and Families Commission Fund, and are used to promote, support and improve the early development of children from the prenatal stage to five years of age. The funds are to be used only for projects or expenditures within the scope of Proposition 10 objectives. This fund was established during FY 98‐99.

Fish and Game

The Fish and Game Fund is used to account for fines and forfeitures received under Section 13003 of the State of California Fish and Game Code and for other revenues and expenditures for the propagation and conservation of fish and game. The Board of Supervisors authorizes expenditures on advice of the Fish and Game Commission.

Petroleum

The Petroleum Fund, established pursuant to Chapter 25 of the County Code, is used to account for the revenues and expenditures associated with administering the Petroleum Ordinance. The Petroleum Ordinance regulates the issuing of oil well drilling permits. It also regulates drilling, operating and abandoning petroleum wells, pipelines, tanks and associated petroleum equipment for prevention of erosion, pollution and fire hazards and for safety controls.

Public and Educational Access

The fund for Public and Educational Access was established in December 2001 by the Board of Supervisors to receive grant revenue from the local cable television franchisee. The primary objectives and purposes of the fund are the support of education and public information through programs aimed at expanding public access and educational access to telecommunication services.

Special Aviation

The Special Aviation Fund is used to account for activity related to the Santa Ynez Airport. It is funded primarily by state and federal grants for airport improvements.

In‐Home Supportive Services (IHSS) Public Authority

The In‐Home Supportive Services Public Authority Fund was established by the Board to act as the employer of record for IHSS individual providers. As an administrative unit, it carries out functions prescribed in Welfare & Institutions Code Section 12301.6. Those functions include a provider screening process, a registry that will match eligible providers and consumers, and collective bargaining with providers and their representatives. IHSS also offers access to training for providers and consumers while continuing to allow for consumer choice in the selection of providers.

Child Support Services

AB 196, AB 150, and SB 542 established the Child Support Services Fund during FY 00‐01 to provide separate fund accountability as required. These legislative bills mandated that all Family Support Divisions located in the District Attorney’s Offices become separate and independent departments. Child Support Services establishes paternity, obtains and enforces court orders for child support, collects and distributes payments, and provides community outreach about those services for the benefit of minor children.

126

Nonmajor Governmental Funds (Cont’d)

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Fishermen Assistance

Fisheries Enhancement

The Fisheries Enhancement Fund (FEF) was established to mitigate impacts to the commercial fishing industry from offshore oil and gas development. Impact fees paid by offshore energy producers, pursuant to permit conditions, supports the FEF. In early 1993, the Planning Commission approved a supplemental needs assessment that, pursuant to Board‐adopted FEF Guidelines, recommends specific projects to be pursued for FEF awards.

Local Fishermen’s Contingency

The Local Fishermen’s Contingency Fund is financed by County permit conditions placed upon energy projects to mitigate impacts to the commercial fishing industry. The intent of the fund is to provide an interest‐free loan program to fishermen awaiting payment of claims from the Federal Fishermen’s Contingency Fund. The claims are for damage or loss resulting from outer continental shelf development or production, and to reimburse fishermen for damage or loss of gear, not covered under the federal fund, which occurs in state waters because of federal or state oil and gas development, or because of oil production activities such as transport.

Coastal Resources Enhancement

The Coastal Resources Enhancement Fund was established on May 10, 1988 to account for revenues received from offshore oil and gas projects pursuant to permit conditions, and expanded by the Board of Supervisors to projects that mitigate impacts to coastal recreation, aesthetics, tourism, and/or sensitive environmental resources.

Court Activities

AB 2544 in FY 94‐95 established the Court Activities Fund to account for the state’s portion of Trial Court Funding. AB 233, adopted in FY 97‐98, transferred state funding out of the County entity. This fund represents the portion of Trial Court Operations under the County’s control.

Criminal Justice Construction

The Criminal Justice Construction Fund was established to account for state authorized surcharges on criminal fines, which are statutorily designated for the establishment of adequate criminal justice facilities in the County.

Courthouse Construction

The Courthouse Construction Fund was established to account for state authorized surcharges on fines for non‐ parking and other criminal cases, which are statutorily designated for renovation and/or construction of courtroom facilities.

Inmate Welfare

The Inmate Welfare Fund was established pursuant to Penal Code Section 4025 to account for profits from the County jail store and any money attributable to the use of pay telephones. The funds are expended primarily for the benefit, education, and welfare of the inmates confined within the jail.

SPECIAL DISTRICTS UNDER THE BOARD OF SUPERVISORS

Separate special districts have been established for the purpose of providing specific services to distinct geographical areas within the County. Those special districts that are under the jurisdiction of the Board of Supervisors are included within the Special Revenue Fund classification. These are financed principally from property taxes and benefit assessments, and are comprised of the following:

127

Nonmajor Governmental Funds (Cont’d)

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

County Service Areas (CSAs)

County Service Area #3

This service area serves part of the Goleta Valley, providing extended park and open space acquisition and maintenance, enhanced library services and street lighting. It provides 1,430 streetlights and maintains approximately 535 acres of open space and 148 acres of parks. This fund also made payments for the Goleta Valley Community Center and the Santa Barbara Shores property prior to the transfer of these assets to the City of Goleta.

County Service Area #4

This service area is located north of the City of Lompoc and serves the communities of Mission Hills and Vandenberg Village. It maintains approximately 52 acres of open space.

County Service Area #5

This service area serves the Orcutt area south of Santa Maria, providing extended park and open space activities. Extending from Waller Park, to just south of Rice Ranch Road, CSA #5 encompasses approximately 68 acres of parkland (Waller Park) and 11 acres of open space.

County Service Area #11

This service area embraces the unincorporated urbanized area of Carpinteria Valley and Summerland. The service area provides the community with parks and 77 streetlights.

County Service Area #12 – Mission Canyon Sewer Service Charge

This service area was established for the purpose of assessing property owners for the ongoing maintenance of the sewer system and septic tank inspection services for those properties in the prohibition area, but not on public sewers. A separate assessment is charged to properties remaining on septic systems in order to provide septic performance tracking.

County Service Area #31

This service area embraces the unincorporated community of Isla Vista, located west of the University of California at Santa Barbara, and provides 277 streetlights; installation, maintenance and repair of sidewalks, curbs and gutters and planting, along with maintenance and care of street trees.

County Service Area #41

This service area was established to assess property owners of the Rancho Santa Rita Subdivision, located outside the City of Lompoc, for road repairs, maintenance and improvements.

Community Facilities Districts (CFDs)

Orcutt Community Facilities District

In October 2002, qualified landowners approved the formation of a CFD within the Orcutt Planning Area, located south of the City of Santa Maria. The CFD levied a special tax that may be used to finance infrastructure construction, fire and sheriff protection services, maintenance of parks, parkways and open space, and flood and storm protection services.

Providence Landing Community Facilities District

This Mello‐Roos district encompasses the Providence Landing subdivision in South Vandenberg Village and provides funding for the maintenance of a public park.

128

Nonmajor Governmental Funds (Cont’d)

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Lighting Districts

Mission Lighting District

This district provides 19 streetlights in the unincorporated area of Mission Canyon, located east of the City of Santa Barbara, and is financed by property taxes and benefit assessments.

North County Lighting District

Casmalia, Los Alamos, and Orcutt Lighting Districts and the lighting function of CSA #4 and CSA #5 were consolidated in FY 94‐95 to form the North County Lighting District which provides 2,764 streetlights in the North County. This district is financed by property taxes and benefit assessments.

Sandyland Seawall Maintenance District

This district provides for the maintenance of a seawall constructed in the Sandyland Cove area, and is financed through benefit assessments levied against those properties adjacent to that beachfront area.

Water Agency

This agency prepares investigations and reports on the County’s water requirements, project development, and efficient use of water. The agency provides technical assistance to other County departments, water districts, and the public concerning water availability and water well locations and design. The agency also administers the Cachuma Project and Twitchell Dam Project contracts with the U.S. Bureau of Reclamation. It is funded primarily by state grants and property tax revenue.

DEBT SERVICE FUNDS

Debt Service Funds are used to account for the accumulation of resources for, and the payment of, general long‐ term debt.

Santa Barbara County Finance Corporation

The Santa Barbara County Finance Corporation Debt Service Fund accounts for the accumulation of resources for, and payment of, principal and interest incurred from the sale of Certificates of Participation and other municipal debt that is issued to finance various County capital projects.

129

COUNTY OF SANTA BARBARA, CALIFORNIA COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 2015 (in thousands)

Assets

Assets:
Cash and investments Accounts receivable, net:

Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services

Other
Other receivables
Restricted cash and investments

Total assets

Liabilities and fund balances

Liabilities:
Accounts payable
Salaries and benefits payable
Other payables
Advances from grantors and third parties Due to other funds
Customer deposits payable

Total liabilities

Fund balances: Nonspendable Restricted Committed

Total fund balances
Total liabilities and fund balances

First 5 Children Fish and Families and Commission Game

Petroleum

Special Revenue

Public and
Educational Special

Access Aviation

IHSS Public Authority

360

— 1,549 — — — — 1,909

1 39 — — — — 40

— 368 1,501 1,869

1,909

Child Support Services

$ 670

1 325 — — — — $ 996

$ — 504 — 304 — — 808

— 188 — 188

$ 996

$

$

$

4,492 $

5 786 — 114 6 —

5,403 $

530 $ 103

— 50 — — 683

6 4,714 — 4,720

5,403 $

79 $

— 1 — — — — —

80 $

— $ —

— — —

— 80 — 80

80 $

471 $ 1,024 $ 252

— — — 1 1 —

  • —  — —
  • —  — —
  • —  — —
  • —  — —
  • —  — —

472 $ 1,025 $ 252

1 $ — $ 43 24 — —

  • —  — —
  • —  — —
  • —  — —
  • —  — —

25 — 43

— — — 447 1,025 209 — — — 447 1,025 209

472 $ 1,025 $ 252

$

$

$

$

$

130

Fishermen Assistance

  • $  414

    — — — — — — —

  • $  414
  • $  — — — — — — —

    — 414 — 414

  • $  414

Coastal Resources Enhancement

Special Revenue

Criminal Justice Construction

$ —

County Service Areas

Court Activities

1,207 $ 771

— 157 2 — — — — 298 — — — — — —

1,209 $ 1,226

— $ 806 — — — — — — — — — — — 806

— — 1,209 204 — 216 1,209 420

1,209 $ 1,226

Inmate Welfare

1,068 $ 1,641

74 — 1 2 — — — — — — — — — —

1,143 $ 1,643

— $ — — 51 1 — — — — — — — 1 51

— — 987 1,592 155 —

1,142 1,592 1,143 $ 1,643

Courthouse Construction

$

$

$

$

$

$

$

Assets:
3,456 Cash and investments

Accounts receivable, net:
— Fines, forfeitures, and penalties 4 Use of money and property
— Intergovernmental
— Charges for services
— Other
1 Other receivables
— Restricted cash and investments

3,461 Total assets

Liabilities and fund balances

Liabilities:
— Accounts payable
— Salaries and benefits payable
— Other payables
— Advances from grantors and third parties — Due to other funds
— Customer deposits payable
— Total liabilities

Fund balances: 1 Nonspendable

3,460 Restricted — Committed

3,461 Total fund balances
3,461 Total liabilities and fund balances

74 — — — — — —

Assets

$

$

74 $

1 $ —
1

41 — 43

— 26 5 31

74 $

$

$

$

131

COUNTY OF SANTA BARBARA, CALIFORNIA COMBINING BALANCE SHEET (Continued) NONMAJOR GOVERNMENTAL FUNDS
June 30, 2015 (in thousands)

Community Facilites Districts

Lighting Districts

Special Revenue

Sandyland Seawall Maintenance

29

— — — — — — —

29

— — — — — — —

— 29 — 29

29

Water Agency

$ 7,128

8 81 11 — 31 15 $ 7,274

$ 76 76 — — — 15 167

31 6,451 625 7,107

$ 7,274

Debt Service Santa

Special Barbara Revenue County Finance

Total Corporation

$ 24,228 $ 119

305 — 27 — 2,741 — 309 — 114 — 38 — 15 1,200 $ 27,777 $ 1,319

$ 1,468 $ — 797 — 2 — 354 — 41 — 15 — 2,677 —

38 — 22,560 1,319 2,502 — 25,100 1,319

$ 27,777 $ 1,319

Total Nonmajor Governmental Funds

24,347

305 27 2,741 309 114 38 1,215 29,096

1,468 797 2 354 41 15 2,677

38 23,879 2,502 26,419

29,096

Assets

Assets:
Cash and investments Accounts receivable, net:

Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services

Other
Other receivables
Restricted cash and investments

Total assets

Liabilities and fund balances

Liabilities:
Accounts payable
Salaries and benefits payable
Other payables
Advances from grantors and third parties Due to other funds
Customer deposits payable

Total liabilities

Fund balances: Nonspendable Restricted Committed

Total fund balances
Total liabilities and fund balances

$ 624 $ 542 $

— — — 1 — — — — — — — — — —

$ 624 $ 543 $

$ — $ 10 $ — —

— — — — — — — — — 10

— — 624 533 — — 624 533

$ 624 $ 543 $

$

$

$

$

132

133

COUNTY OF SANTA BARBARA, CALIFORNIA
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

First 5 Children and Families Commission

$ —
— —

Special Revenue

Public and Educational Access

— — — 5 — — — 5

— — — —

10

— 10

(5)

— — — —

(5)

Fish

and Game

Petroleum

$ — 27 — 2 — 357 — 386

— 434 — —

— 434

(48)

— — — —

(48)

Special Aviation

IHSS Public Authority

Child Support Services

$ — — — 4 9,389 — — 9,393

— 9,432 — — —

— 9,432

(39)

— — — —

(39)

Revenues

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services
Other

Total revenues

Expenditures

Current:
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs

Debt service: Principal Interest

Total expenditures
Excess (deficiency) of revenues

over (under) expenditures

Other financing sources (uses)

Transfers in
Transfers out Long‐term debt issued

Total other financing sources (uses) Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$ —

$

$ –$ — — — — — –3 (18) 6,262 — — — 1 (18) 6,266

— — — 7,325 — —

127 — — —

— —

— — 127 7,325

(145) (1,059)

— — — — — — — —

(145) (1,059)

$

— 58 22 — 3,970 — — — 920 — 4,912 58

— — 4,992 — — 12 — — — —

— —

— — 4,992 12

(80) 46

— — (31) — — — (31) —

(111) 46

4,831 34 4,720 $ 80 $

495 1,030 354 2,928 227 447 $ 1,025 $ 209 $ 1,869 $ 188

134

Fishermen Assistance

$ — — — 2 — — 10 12

— — 8 — —

— — 8

4

— — — —

4

410 $ 414

Coastal Resources Enhancement

Court Activities

Special Revenue

Criminal Justice Construction

County Service Areas

Courthouse Inmate Construction Welfare

$ — $ — — — 888 — 5 814 — — — — — 566 893 1,380

— 940 — — — — — — — —

— — — — — 940

893 440

8,537 —
— (884) (747) — ——–

8,537 (884) (747) —

(749) 4 146 440

1,169 27 996 1,152 420 $ 31 $ 1,142 $ 1,592

Revenues

$

— $ –$ —

$

1,227 Taxes
— Licenses, permits, and franchises — Fines, forfeitures, and penalties

17 Use of money and property

15 Intergovernmental 967 Charges for services

12 Other
2,238 Total revenues

Expenditures

Current:
— Public safety

— Health & public assistance
986 Community resources & public facilities

— General government & support services — General county programs

Debt service: — Principal
— Interest

986 Total expenditures
Excess (deficiency) of revenues

1,252 over (under) expenditures Other financing sources (uses)

31 Transfers in (945) Transfers out

— Long‐term debt issued
(914) Total other financing sources (uses)

338 Net change in fund balances 3,123 Fund balances ‐ beginning

3,461 Fund balances ‐ ending

— — 6 — —

678 684

— 597 — —

— 597

87

— — — —

87

1,122 1,209 $

— — 1,506 888 (115) — — — 3,676 — 963 — 6,030 888

15,316 — — — — — — — — —

— —

— — 15,316 —

(9,286) 888

— —

$

$

135

COUNTY OF SANTA BARBARA, CALIFORNIA
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES (Continued) NONMAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Community
Facilities Lighting Districts Districts

$ 500 $ 429 — — — — 3 2 — 2 — — — — 503 433

— —

— — 198 412 — — — —

Special Revenue

Sandyland Seawall Maintenance

$ — — — — — — — —

— — 2 — —

— — 2

(2)

— — — —

(2)

31
$ 29$

Water Agency

2,542 $ —

34 1,329 351 2 4,258

— 4,273 — —

— 4,273

(15)

614 (116)

— 498

483

6,624 7,107 $

Special Revenue Total

4,698 27 3,340 804 20,949 5,351 3,152 38,321

16,256 21,749 6,922 127 10

— 45,064

(6,743)

Debt Service Santa Barbara County Finance Corporation

$ — — — 6 1,380 — — 1,386

— — — —

90

15,318 2,516 17,924

(16,538)

Total Nonmajor Governmental Funds

Revenues

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for services
Other

Total revenues

Expenditures

Current:
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs

$

$

4,698 27 3,340 810 22,329 5,351 3,152 39,707

16,256 21,749 6,922 127 100

15,318 2,516 62,988

(23,281)

14,228 (2,975) 9,925

21,178 (2,103)

Debt service:
Principal — — Interest — —

Total expenditures

Excess (deficiency) of revenues over (under) expenditures

Other financing sources (uses)

Transfers in
Transfers out Long‐term debt issued

Total other financing sources (uses) Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

198 412 305 21

— — (252) — — — (252) —

53 21

571 512 624 $ 533

9,182 5,046 (2,975) — — 9,925 6,207 14,971

(536) (1,567)

$

25,636 2,886 28,522 25,100 $ 1,319 $ 26,419

136

137

COUNTY OF SANTA BARBARA, CALIFORNIA
FIRST 5 CHILDREN AND FAMILIES COMMISSION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Actual Amounts

$ 22 3,970 920 4,912

Variance with Final Budget

$9 (213)

59 (145)

223 223

78

— —

78

Revenues

Use of money and property Intergovernmental
Other

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures

Deficiency of revenues under expenditures

Other financing uses

Transfers out
Total other financing uses

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

Final

$ 13 4,183 861 5,057

5,215 5,215

(158)

(31) (31)

(189)

4,831 4,642

10 3,913 829 4,752

4,951 4,951

(199)

(2) (2)

(201)

4,831
4,630 $

4,992 4,992

(80)

(31) (31)

(111)

$

$

4,831 — 4,720 $ 78

138

COUNTY OF SANTA BARBARA, CALIFORNIA
FISH AND GAME SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

6 $ 6

19 19

(13)

(13)

34
21 $

Final

Actual Amounts

Variance with Final Budget

Revenues

Fines, forfeitures, and penalties $ Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures
Excess (deficiency) of revenues over (under) expenditures

Net change in fund balances Fund balances ‐ beginning

Fund balances ‐ ending $

6 $ 6

19 19

(13)

(13)

34
21 $

58 58

12 12

46 46

34 80

$

$

52 52

7 7

59 59

— 59

139

COUNTY OF SANTA BARBARA, CALIFORNIA
PETROLEUM SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Original

$ 55 Use of money and property 3 Charges for services 388 Total revenues 446

Expenditures

Current:
Community resources & public facilities 530

Total expenditures 530 Deficiency of revenues under expenditures (84) Net change in fund balances (84)

Fund balances ‐ beginning 495
Fund balances ‐ ending $ 411 $

Revenues

Final Amounts

$ 55 $ 27 3 2 388 357 446 386

530 434 530 434

(84) (48)

(84) (48)

495 495 411 $ 447

Licenses, permits, and franchises

$

(28) (1) (31) (60)

96 96

36 36

— 36

$

140

COUNTY OF SANTA BARBARA, CALIFORNIA
PUBLIC AND EDUCATIONAL ACCESS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Original

Final Amounts

5 $ 5 5 5

34 10 34 10

(29) (5)

(29) (5)

1,030 1,030 1,001 $ 1,025

Revenues

Use of money and property $ — $ Total revenues —

Expenditures

Current:
General county programs 34

Total expenditures 34 Deficiency of revenues under expenditures (34) Net change in fund balances (34)

Fund balances ‐ beginning 1,030
Fund balances ‐ ending $ 996 $

$

$

— —

24 24

24 24

— 24

141

COUNTY OF SANTA BARBARA, CALIFORNIA
SPECIAL AVIATION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

Variance with Final Budget

Revenues

Intergovernmental $ 681 $ Total revenues 681

Expenditures

Current:
General government & support services 681

Total expenditures 681 Deficiency of revenues under expenditures — Net change in fund balances —

Fund balances ‐ beginning 354
Fund balances ‐ ending $ 354 $

724 $ (18) $ (742) 724 (18) (742)

811 127 684 811 127 684

(87) (145) (58) (87) (145) (58)

354 354 — 267$209$(58)

142

COUNTY OF SANTA BARBARA, CALIFORNIA
IN‐HOME SUPPORTIVE SERVICES (IHSS) PUBLIC AUTHORITY SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

$3 6,262 1 6,266

Variance with Final Budget

$3 331 1 335

229 229

564

(14) (14)

550

— $ 550

Revenues

Use of money and property $ Intergovernmental 5,863 Other —

$ — 5,931 — 5,931

7,554 7,554

(1,623)

14 14

(1,609)

2,928 1,319

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures

Deficiency of revenues under expenditures

Other financing sources

Transfers in
Total other financing sources

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

— 5,863

$

7,485 7,485

(1,622)

14 14

(1,608)

2,928
1,320 $

$

7,325 7,325

(1,059)

— —

(1,059)

2,928 1,869

143

COUNTY OF SANTA BARBARA, CALIFORNIA
CHILD SUPPORT SERVICES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

$4 9,389 9,393

9,432 9,432

(39) (39) 227

Variance with Final Budget

$ — (88) (88)

49 49

(39) (39) —

Revenues

Use of money and property $ Intergovernmental 9,442

$4 9,477 9,481

9,481 9,481

227 227

Total revenues

Expenditures

Current:
Health & public assistance

Total expenditures
Deficiency of revenues under expenditures

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

4 9,446

$

9,446 9,446

227
227 $

$ 188 $ (39)

144

COUNTY OF SANTA BARBARA, CALIFORNIA
FISHERMEN ASSISTANCE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

$2 10 12

8 8

4

4

410 $ 414

Variance with Final Budget

$ — — —

22 22

22 22 —

$ 22

Revenues

Use of money and property $
Other 10

$2 10 12

30 30

(18)

(18)

410 392

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures
Excess (deficiency) of revenues over (under) expenditures

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

2 12

30 30

(18) (18)

410
$ 392 $

145

COUNTY OF SANTA BARBARA, CALIFORNIA
COASTAL RESOURCES ENHANCEMENT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

Variance with Final Budget

$2 2 4

582 582

586 586

— $ 586

Revenues

Use of money and property $
Other 676

$6 680 684

1,179 597 1,179 597

(499) 87

(499) 87 1,122 1,122

3 679

$4
676 678

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures
Excess (deficiency) of revenues over (under) expenditures

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

1,179 1,179

(500)

(500)

1,122
622 $

623

$ 1,209

146

COUNTY OF SANTA BARBARA, CALIFORNIA
COURT ACTIVITIES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

15,244 15,244

(8,549)

8,537 8,537

(12)

1,169
1,157 $

Final

1,822 5 3,628 1,013 6,468

15,470 15,470

(9,002)

8,537 8,537

(465)

1,169 704

Actual Amounts

1,506 (115)

3,676 963 6,030

15,316 15,316

(9,286)

8,537 8,537

(749)

1,169 420

Variance with Final Budget

Revenues

Fines, forfeitures, and penalties
Use of money and property
Charges for services
Other 1,246

$

1,818 $ 3

$

$

(316) (120) 48

(50) (438)

154 154

(284)

— —

(284)

— (284)

Total revenues

Expenditures

Current: Public safety

Total expenditures

Deficiency of revenues under expenditures

Other financing sources

Transfers in
Total other financing sources

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

3,628 6,695

$

$

$

147

COUNTY OF SANTA BARBARA, CALIFORNIA
CRIMINAL JUSTICE CONSTRUCTION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

950 $ 888 950 888

— — 950 888

(884) (884) (884) (884)

66 4

27 27 93 $ 31

Variance with Final Budget

Revenues

Fines, forfeitures, and penalties $ 950 $ Total revenues 950

Expenditures

Total expenditures — Excess of revenues over expenditures 950

Other financing uses

Transfers out (884) Total other financing uses (884)

Net change in fund balances 66 Fund balances ‐ beginning 27

Fund balances ‐ ending $ 93 $

$

(62) (62)

— (62)

— —

(62)

— (62)

$

148

COUNTY OF SANTA BARBARA, CALIFORNIA
COURTHOUSE CONSTRUCTION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Original

Final Amounts

950 $ 888 5 5 955 893

— — 955 893

(747) (747) (747) (747)

208 146

996 996 1,204 $ 1,142

Revenues

Fines, forfeitures, and penalties $ 950 $ Use of money and property 4
Total revenues 954

Expenditures

Total expenditures — Excess of revenues over expenditures 954

Other financing uses

Transfers out (747) Total other financing uses (747)

Net change in fund balances 207 Fund balances ‐ beginning 996

Fund balances ‐ ending $ 1,203 $

$

(62) — (62)

— (62)

— —

(62)

— (62)

$

149

COUNTY OF SANTA BARBARA, CALIFORNIA
INMATE WELFARE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Original

Final Amounts

599 $ 814

544 566 1,143 1,380

1,142 940 1,142 940

1 440

1 440

1,152 1,152 1,153 $ 1,592

Revenues

Use of money and property $ 585 $ Other 544

$

215 22 237

202 202

439 439

— 439

Total revenues

Expenditures

Current: Public safety

Total expenditures
Excess of revenues over expenditures

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

1,129

1,129 1,129

1,152
1,152 $

$

150

COUNTY OF SANTA BARBARA, CALIFORNIA
COUNTY SERVICE AREAS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Revenues

Taxes
Use of money and property Intergovernmental Charges for services
Other

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Excess of revenues over expenditures

Other financing sources (uses)

Transfers in Transfers out

Total other financing uses
Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

Budgeted Amounts Original

1,219 $ 15

6 901 — 2,141

1,207 1,207

934

— (919) (919)

15

3,123
3,138 $

Final

1,219 16 6 941 — 2,182

1,207 1,207

975

— (1,246) (1,246)

(271)

3,123 2,852

$

Actual Amounts

1,227 17 15 967 12 2,238

986 986

1,252

31 (945) (914)

338

3,123 3,461

Variance with Final Budget

$8 1 9 26 12 56

221 221

277

31 301 332

609

— $ 609

$

$

151

COUNTY OF SANTA BARBARA, CALIFORNIA
COMMUNITY FACILITIES DISTRICTS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

$ 413 $ 3

416

30 30

386

(384) (384)

2

571
$ 573 $

Final

Actual Amounts

483 $ 500 4 3 487 503

202 198 202 198

285 305

(257) (252) (257) (252)

28 53

571 571 599 $ 624

Variance with Final Budget

Revenues

Taxes
Use of money and property

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Excess of revenues over expenditures

Other financing uses

Transfers out
Total other financing uses

Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

17 (1) 16

4 4

20

5 5

25

— 25

$

152

COUNTY OF SANTA BARBARA, CALIFORNIA
LIGHTING DISTRICTS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

Final

Actual Amounts

418 $ 429 2 2 3 2

423 433

421 412 421 412

2 21

2 21

512 512 514 $ 533

Variance with Final Budget

Revenues

Taxes $ 418 $ Use of money and property 1 Intergovernmental 3

Total revenues 422

Expenditures

Current:
Community resources & public facilities 361

Total expenditures 361

Excess of revenues over expenditures 61

Net change in fund balances 61

Fund balances ‐ beginning 512
Fund balances ‐ ending $ 573 $

$

11 — (1)

10

9 9

19 19

— 19

$

153

COUNTY OF SANTA BARBARA, CALIFORNIA
SANDYLAND SEAWALL MAINTENANCE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

— $

5 5

(5)

(5)

31
26 $

Final

Actual Amounts

Variance with Final Budget

Revenues

Total revenues $

Expenditures

Current:
Community resources & public facilities

Total expenditures
Deficiency of revenues under expenditures

Net change in fund balances

Fund balances ‐ beginning
Fund balances ‐ ending $

— $

5 5

(5)

(5)

31
26 $

2 2

(2)

(2)

31 29

$

$

3 3

3 3

— 3

154

COUNTY OF SANTA BARBARA, CALIFORNIA
WATER AGENCY SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Original

2,260 $ 20

3,628 149 — 6,057

8,882 8,882

(2,825)

614 (141) 473

(2,352)

6,624
4,272 $

Final

2,269 25 3,678 132 — 6,104

8,915 8,915

(2,811)

614 (141) 473

(2,338)

6,624 4,286

Actual Amounts

2,542 34 1,329 351 2 4,258

4,273 4,273

(15)

614 (116) 498

483

6,624 7,107

Variance with Final Budget

Revenues

Taxes
Use of money and property Intergovernmental Charges for services
Other

Total revenues

Expenditures

Current:
Community resources & public facilities

Total expenditures

Deficiency of revenues under expenditures

Other financing sources (uses)

Transfers in Transfers out

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

$

$

273 9

(2,349) 219 2

(1,846)

4,642 4,642

2,796

— 25 25

2,821

— 2,821

$

$

$

155

COUNTY OF SANTA BARBARA, CALIFORNIA
SANTA BARBARA COUNTY FINANCE CORPORATION DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES ‐ BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Budgeted Amounts Actual

Variance with Final Budget

Revenues

Use of money and property Intergovernmental

Total revenues

Expenditures

Current:
General county programs

Debt service: Principal Interest

Total expenditures

Deficiency of revenues under expenditures

Other financing sources

Transfers in Long‐term debt issued

Total other financing sources Net change in fund balances

Fund balances ‐ beginning Fund balances ‐ ending

$

Final Amounts

$ 25 $6

$

(19) (1) (20)

37

— 60 97

77

(16) 60 44

121

— 121

Original

25 1,381 1,406

17

4,088 2,469 6,574

(5,168)

5,062 — 5,062

(106)

2,886
2,780 $

$

1,381 1,406

127

15,318 2,576 18,021

(16,615)

5,062

9,865 14,927

(1,688)

2,886
1,198 $

1,380 1,386

90

15,318 2,516 17,924

(16,538)

5,046

9,925 14,971

(1,567)

2,886 1,319

$

156

INTERNAL SERVICE FUNDS

157

Internal Service Funds

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

The following funds are established to account for services furnished to the County and various other governmental agencies. They are exempt from legal compliance for budgetary control and follow commercial accounting principles for a determination of operating, rather than budgetary, results. Their major source of revenue consists of charges to user departments for services rendered. These charges are based upon standard rates calculated on an estimated cost recovery basis. A more detailed description of the funds established and used by the County follows:

INFORMATION TECHNOLOGY SERVICES

This fund provides enterprise information technology services to County departments and various other governmental agencies. Four lines of service are supported: Network and Security, Infrastructure, Desktop Support, and Enterprise Applications. Costs are allocated to all users based upon utilization factors for each service and are designed to recover costs of each system. Profits or losses are carried forward and used to adjust allocations in subsequent years. Costs of operating the fund include personnel, supplies, utilities, maintenance, and depreciation of equipment.

VEHICLE OPERATIONS AND MAINTENANCE

This fund provides for the maintenance, servicing and repair of County vehicles. Rental rates, which include the cost of gas, oil, maintenance, replacement of equipment and personnel costs, are charged to the user department to support the vehicle program. Vehicles are replaced based on mileage and age criteria which varies per class of vehicle; new additions to the vehicle fleet are provided through the Garage Equipment and Motor Pool budgets of the General Fund and through contributions from other funds.

RISK MANAGEMENT AND INSURANCE

This column combines the County’s five self‐insurance funds: Dental, Unemployment, Workers’ Compensation, General Liability, and Medical Malpractice.

Dental Self‐Insurance

This fund provides for the payment of dental expenses incurred by County employees, eligible dependents and retirees who are part of the self‐funded plan. This fund does not account for employees or retirees on the Dental Net, Prudential or Firefighter health plans. Professional administrators process all claims and make payments to claimants based on a payment schedule of medical and dental benefits. The fund reimburses the claims administrator for the payment of claims plus a fee for administration and participation in a prescription drug program. Additionally, the County contracts with a preferred provider organization for reduced fees from member dental service providers, physicians, and other specialists. The County contributes towards the cost of employee coverage through departmental budgets; the employee pays any remaining employee or dependent coverage.

Unemployment Self‐Insurance

State law requires the County to maintain unemployment insurance. The County has elected to be self‐insured and has established this fund for the payment of unemployment insurance claims by County employees, which have been processed and approved by the State Employment Development Department. Each department has been charged a percentage of its gross payroll for the establishment of a general reserve for this program and to provide for claim payments.

Workers’ Compensation Self‐Insurance

This fund provides for investigation services, temporary disability and medical payments, excess insurance, permanent disability awards, administrative services, litigation costs, and safety services. Premiums based on employee worker classifications are charged to each department to maintain actuarially recommended reserves for claims proportionate to current industry rates applicable to job functions.

158

Internal Service Funds (cont’d)

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

General Liability Self‐Insurance

This fund provides for payment of self‐insured general liability and automobile liability claims, excess insurance, claims adjusting services, litigation costs, and administrative services. Contributions are made by participating County departments and funds based on past claims experience and appropriate risk factors.

Medical Malpractice Self‐Insurance

This fund provides for the payment of self‐insured medical malpractice and general liability claims, excess insurance, claim investigation services, and litigation costs. Contributions are made by covered participating County departments and are based on allocation of expenses by past claims experience and appropriate risk factor.

COMMUNICATIONS SERVICES

This fund provides communication services to County departments and various other governmental agencies. Telephone, Radio and Audio‐Visual Systems are maintained. Costs are billed from a standard price schedule which is periodically adjusted to reflect cost changes and are designed to recover costs of each system. Profits or losses are carried forward and used to adjust allocations in subsequent years. Costs of operating the fund include personnel, supplies, utilities, maintenance, and depreciation of equipment.

UTILITIES

This fund provides for payment of County‐wide utility costs. Utility costs are allocated to various County departments based on their energy consumption. Charging County departments for their energy usage fosters awareness and accountability related to energy costs and savings.

159

COUNTY OF SANTA BARBARA, CALIFORNIA INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET POSITION June 30, 2015 (in thousands)

Assets

Information Technology Services

Vehicle Operations and Maintenance

Risk
Management Communi‐

and cations Insurance Services

Utilities

$ 1,065

1 14

55 — 1,135

543 —

3,352 3,895 5,030

56 56

10 17 15 17

335 — 394

9 3,920 — 29 247 4,205 4,599

58 58

(903) 1,332

Total

55,968

58 488

55 258 56,827

762 10

27,833 28,605 85,432

1,687 1,687

621 525 15 488 335 7,047 9,031

244 3,920 17,195 1,635 7,877 30,871 39,902

1,759 1,759

23,578 21,880 45,458

Current assets:
Cash and investments (Note 4) $ 5,265 Accounts receivable, net:

Use of money and property 5 Charges for services — Other —

Inventories — Total current assets 5,270

Noncurrent assets:
Other receivables — Restricted cash and investments (Note 5) — Capital assets, net of

accumulated depreciation/amortization (Note 7) 3,263 Total noncurrent assets 3,263 Total assets 8,533

Deferred outflows of resources

Deferred pensions 787 Total deferred outflows of resources 787

Liabilities

Current liabilities:
Accounts payable 13 Salaries and benefits payable 252 Other payables — Compensated absences (Note 10) 234 Notes payable (Note 13) — Liability for self‐insurance claims —

Total current liabilities 499

Noncurrent liabilities:
Compensated absences (Note 10) 153 Notes payable (Note 13) — Liability for self‐insurance claims — OPEB obligation (Note 10) 747 Net pension liability (Note 22) 3,729

Total noncurrent liabilities 4,629 Total liabilities 5,128

Deferred inflows of resources

Deferred pensions 821 Total deferred inflows of resources 821

Net position

Net investment in capital assets 3,263 Unrestricted 108 Total net position $ 3,371

$

15,760

17 — — 148 15,925

— 10

17,622 17,632 33,557

424 424

129 135 — 118 — — 382

43 — — 404 1,925 2,372 2,754

442 442

17,622 13,163 30,785

$

26,875 $ 7,003

28 7 474 — — — — 110 27,377 7,120

219 — — —

7 3,589 226 3,589 27,603 10,709

183 237 183 237

364 105 55 66 — — 48 71 — — 7,047 — 7,514 242

31 8 — — 17,195 — 226 229 851 1,125 18,303 1,362 25,817 1,604

191 247 191 247

7 3,589 1,771 5,506 1,778 $ 9,095

$

$

$

$ 429 $

160

COUNTY OF SANTA BARBARA, CALIFORNIA
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Information Technology Services

Vehicle Operations and Maintenance

10,429 — 91 10,520

1,983 5,002 — 24 2,674 132 9,815

705

79 — 103 4 186

891

860 (58) 802

Risk
Management Communi‐

and cations Insurance Services

24,776 $ 3,676 1,086 — 51 55 25,913 3,731

857 1,075 15,992 1,577 8,940 — 213 291 2 406 1,323 51 27,327 3,400

(1,414) 331

124 154 — — (3) — 57 61 178 215

(1,236) 546

— 70 — (29) — 41

Utilities

5,101 $ —

— 5,101

236 4,915 — 55 250 17 5,473

(372)

4 (181)

— 536 359

(13)

130 — 130

117

584 (272) 312

429 $

Total

51,024 1,086 203 52,313

7,733 29,097 8,940 631 4,384 1,617 52,402

(89)

385 (181) 101 673 978

889

1,060 (87)

973

1,862

52,169 (8,573) 43,596

45,458

Operating revenues

Charges for sales and services $ 7,042 Self‐insurance recovery — Other operating revenues 6

Total operating revenues 7,048

Operating expenses

Salaries and benefits 3,582 Services and supplies 1,611 Self‐insurance claims — Contractual services 48 Depreciation and amortization 1,052 County overhead allocation 94

Total operating expenses 6,387 Operating income (loss) 661

Non‐operating revenues (expenses)

Use of money and property 24 Interest expense — Gain (loss) on sale of capital assets 1 Other non‐operating revenues 15

Total non‐operating revenues (expenses) 40

Income (loss) before transfers 701

Transfers in — Transfers out — Transfers in (out), net —

Change in net position 701

Total net position ‐ beginning
Prior period adjustment (Note 24)

Total net position ‐ beginning, as restated Total net position ‐ ending

$

$

$

1,693 (1,236) 587 31,201 3,941 9,728

6,715
(4,045) (2,109)

(927) (1,220) 3,014 8,508 1,778 $ 9,095

2,670 29,092 $ 3,371 $ 30,785

$

$

161

COUNTY OF SANTA BARBARA, CALIFORNIA
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Cash flows from operating activities

Information Technology Services

Vehicle Operations and Maintenance

Risk Management and Insurance

Communi‐ cations

Services Utilities

$ 3,731 $ 5,487 — —

(1,125) (251) (1,773) (5,098)

— —

(51) (17) 61 405 843 526

71 132 (29) — 42 132

(1,148) (105) — —

— (335) — (181) — 131

(1,148) (490)

155 4 155 4

(108) 172

7,111 893 $ 7,003 $ 1,065

$ 7,003 $ 1,065 — — $ 7,003 $ 1,065

$ 331 $ (372)

406 250 61 405

— 386 — — — — 95 (128)

(50) (15) — — $ 843 $ 526

$ — $ —

Total

51,475 1,086 (8,032)

(29,887) (13,116)

(1,617) 542 451

1,063 (87)

976

(7,023) 262

(335) (181) 131

(7,146)

390 390

(5,329)

61,307 55,978

55,968 10 55,978

(89)

4,384 542

247 38 25

(221)

(299) (4,176)

451 —

Receipts from interfund services provided $ 7,048 Receipts from self‐insurance recovery — Payments to employees (3,711) Payments to suppliers (1,657) Payments for self‐insurance claims — County overhead allocation

payments to the General Fund (94) Other receipts 15 Net cash provided (used) by operating activities 1,601

Cash flows from noncapital financing activities

Transfers from other funds — Transfers to other funds — Net cash provided by noncapital financing activities —

Cash flows from capital and related financing activities

Purchase of capital assets (1,015) Proceeds from sales of capital assets 1 Principal paid on bonds and notes payable — Interest paid on bonds and notes payable — Federal interest subsidy on bonds payable —

Net cash used by capital
and related financing activities (1,014)

Cash flows from investing activities

Use of money and property received 25 Net cash provided by investing activities 25

Net change in cash and cash equivalents 612 Cash and cash equivalents ‐ beginning 4,653

Cash and cash equivalents ‐ ending $ 5,265 Reconciliation of cash and cash equivalents to the Statement of Net Position

$

10,520 —

(2,057) (5,076)

(132) 4

3,259

860 (58) 802

(4,748) 261 — — —

(4,487)

78 78

(348)

16,118 15,770

15,760 10 15,770

705

2,674 4

— 38 — (88) (74) — 3,259

$

24,689 1,086

(888) (16,283) (13,116)

(1,323) 57

(5,778)

— — —

(7) — — — —

(7)

128 128

(5,657)

32,532 26,875

26,875 — 26,875

(1,414)

2 57

(139) —

25 (102) (31) (4,176) (5,778)

$

$

$ $

$

$

$

$

$

Cash and investments per Statement of Net Position Restricted cash and investments

per Statement of Net Position Total cash and cash equivalents per Statement of Net Position

Reconciliation of operating income (loss) to net cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income (loss) to net cash

provided (used) by operating activities:
Depreciation and amortization
Other non‐operating revenue
Changes in assets, deferred inflows of resources, liabilities,

and deferred outflows of resources Accounts and other receivables Inventories
Prepaid items

Accounts payable
Salaries and benefits payable Liability for self‐insurance claims

Net cash provided (used) by operating activities

Noncash investing, capital, and financing activities

$

$

$

5,265 $ — 5,265 $

661 $

1,052 15

— — — 2

(129) —

1,601 $ — $

$ $

$ $

$ $

162

AGENCY FUNDS

163

Agency Funds

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

Agency funds are custodial in nature and do not involve the measurement of results of operations. Such funds have no equity accounts since all assets are due to individuals and entities at some future time.

CLEARING AND REVOLVING FUNDS provide clearing facilities for items such as payroll withholdings and warrant redemption. These funds are used to temporarily accumulate and hold resources for distribution to third parties.

DEPOSITS FUNDS account for deposits under the control of the County departments. Dispositions of the deposits are governed by the terms of the statutes and ordinances establishing the deposit requirement.

OTHER AGENCY FUNDS account for assets held by the County in a fiduciary capacity for other entities.

STATE AND CITY REVENUE FUNDS temporarily hold various fees, fines, and penalties collected by the County departments for the State of California or various cities in Santa Barbara County, which are passed through to these entities.

TAX COLLECTION FUNDS account for monies received for current and delinquent taxes, which must be held pending authority for distribution. Included are prepaid taxes, disputed taxes, duplicate payment of taxes, etc. These funds also account for monies deposited by third parties pending settlement of litigation and claims. Upon final settlement, monies are dispersed as directed by the courts or by parties to the dispute.

164

COUNTY OF SANTA BARBARA, CALIFORNIA
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS
FOR THE FISCAL YEAR ENDED June 30, 2015 (in thousands)

Clearing and revolving funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities

Deposits funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities

Other agency funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities

State and city revenue funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities

Tax collection funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities

Total ‐ all agency funds

Assets:
Cash and investments Interest receivable

Total assets

Liabilities:
Accounts payable Funds held for others

Total liabilities
See accompanying independent auditor’s report.

July 1, 2014 Additions

$ 8,854 $ 1,100,354 — —

  • $  8,854 $ 1,100,354
  • $  3,805 $ 225,972

5,049 1,321,856

  • $  8,854 $ 1,547,828
  • $  2,143 $ 18,333

— —

  • $  2,143 $ 18,333
  • $  – $ 652

2,143 18,983

  • $  2,143 $ 19,635
  • $  5,838 $ 165,078

4 11

  • $  5,842 $ 165,089
  • $  66 $ 4,122

5,776 169,277

  • $  5,842 $ 173,399
  • $  15,138 $ 242,111

26 75

  • $  15,164 $ 242,186
  • $  56 $ 104,473

15,108 346,644

  • $  15,164 $ 451,117
  • $  15,911 $ 3,279,907

70 248

  • $  15,981 $ 3,280,155
  • $  9 $ 22,088

15,972 3,302,252

  • $  15,981 $ 3,324,340
  • $  47,884 $ 4,805,783

100 334

  • $  47,984 $ 4,806,117
  • $  3,936 $ 357,307

44,048 5,159,012 $ 47,984 $ 5,516,319

Deductions June 30, 2015

$ 1,099,093 $ 10,115 — — $ 1,099,093 $ 10,115

$ 221,502 $ 8,275 1,325,065 1,840 $ 1,546,567 $ 10,115

$ 16,988 $ 3,488 — — $ 16,988 $ 3,488

$ 650 $ 2 17,640 3,486 $ 18,290 $ 3,488

$ 166,070 $ 4,846 12 3 $ 166,082 $ 4,849

$ 4,188 $ – 170,204 4,849 $ 174,392 $ 4,849

$ 240,036 $ 17,213 74 27 $ 240,110 $ 17,240

$ 104,458 $ 71 344,583 17,169 $ 449,041 $ 17,240

$ 3,267,327 $ 28,491 236 82 $ 3,267,563 $ 28,573

$ 22,097 $ – 3,289,651 28,573 $ 3,311,748 $ 28,573

$ 4,789,514 $ 64,153 322 112 $ 4,789,836 $ 64,265

$ 352,895 $ 8,348 5,147,143 55,917 $ 5,500,038 $ 64,265

165

166

Statistical Section

Statistical Section

Statistical Section

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

The information in this section is not covered by the Independent Auditor’s Report, but is presented as supplemental data for the benefit of the readers of the Comprehensive Annual Financial Report. The objectives of statistical section information are to provide financial statement users with additional historical perspective, context, and detail to assist in using the information in the financial statements, notes to financial statements, and required supplementary information to understand and assess the County’s economic condition.

CONTENTS PAGE

FINANCIAL TRENDS 168

These schedules contain trend information to help the reader understand how the County’s financial performance and well‐being have changed over time.

REVENUE CAPACITY 172

These schedules contain trend information to help the reader assess the County’s most significant local revenue source, the property tax.

DEBT CAPACITY 176

These schedules present information to help the reader assess the affordability of the County’s current levels of outstanding debt and the County’s ability to issue additional debt in the future.

DEMOGRAPHIC AND ECONOMIC INFORMATION 179

These schedules offer economic and demographic indicators to help the reader understand the socioeconomic environment within which the County’s financial activities take place.

OPERATING INFORMATION 181

These schedules contain service and infrastructure data to help the reader understand how the information in the County’s financial report relates to the services the County 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.

167

COUNTY OF SANTA BARBARA, CALIFORNIA NET POSITION BY CATEGORY (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (accrual basis of accounting)

Governmental activities

Net investment in capital assets Restricted for:

Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs
Debt service

Unrestricted
Total governmental activities net position

Business‐type activities

Net investment in capital assets Restricted for:

Debt service Unrestricted

Total business‐type activities net position

Primary government

Net investment in capital assets Restricted for:

Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs
Debt service

Unrestricted
Total primary government net position

Notes:

2005‐06 2006‐07

381,435 $ 399,800

10,152 12,990 15,992 19,237 59,649 60,486

8,589 9,913 13,485 12,469 8,652 8,484 81,386 93,424 579,340 $ 616,803

45,006 $ 47,611

1,023 717

8,750 10,922 54,779 $ 59,250

426,441 $ 447,411

10,152 12,990 15,992 19,237 59,649 60,486

8,589 9,913 13,485 12,469 9,675 9,201 90,136 104,346 634,119 $ 676,053

2007‐08 as restated

2008‐09 as restated

2009‐10 as restated

2010‐11

480,240

9,717 42,328 106,691 4,523 15,271 — 16,708 675,478

60,029

— 12,353 72,382

540,269

9,717 42,328 106,691 4,523 15,271 — 29,061 747,860

2011‐12

493,753

14,438 33,627 95,892

5,240 15,957 — 37,170 696,077

64,943

— 16,606 81,549

558,696

14,438 33,627 95,892

5,240 15,957 — 53,776 777,626

2012‐13 2013‐14 2014‐2015

$

$ $

$ $

$

$

$ $

$ $

$

408,831

13,695 12,987 87,145

8,082 17,496 10,088 65,462

623,786

47,604

1,307 15,321 64,232

456,435

13,695 12,987 87,145

8,082 17,496 11,395 80,783

688,018

$

$ $

$ $

$

451,648

9,137 25,118 95,946

7,594 9,150 – 54,439 653,032

57,338

— 9,560 66,898

508,986

9,137 25,118 95,946

7,594 9,150 — 63,999 719,930

$

$ $

$ $

$

466,916

12,189

32,943 101,591 5,483 15,009 — 32,215 666,346

59,750

— 10,851 70,601

526,666

12,189

32,943 101,591 5,483 15,009 — 43,066 736,947

$

$ $

$ $

$

$

$ $

$ $

$

$

$ $

$ $

$

511,144

19,594 33,734 97,710

3,886 14,959 — 30,976 712,003

65,806

— 21,648 87,454

576,950

19,594 33,734 97,710

3,886 14,959 — 52,624 799,457

$

$ $

$ $

$

578,314

24,107

31,005 103,497 4,951 15,596 — 62,497 819,967

70,562

— 25,191 95,753

648,876

24,107

31,005 103,497 4,951 15,596 — 87,688 915,720

$ 588,989

28,640

37,477 152,739 4,960 12,736 —

(551,588) $ 273,953

$ 73,988

— 14,062 $ 88,050

$ 662,977

28,640

37,477 152,739 4,960 12,736 —

(537,526) $ 362,003

  • FY 2007‐08 net position ‘restricted for general county programs’ was restated from $21,878 to $17,496 in FY 2008‐09. As a result, ‘unrestricted’ governmental activities net position was restated from $61,080 to $65,462.
  • FY 2008‐09 net position ‘invested in capital assets, net of related debt’ was restated in FY 2009‐10 from $486,969 to $508,986, and ‘restricted’ net position was restated from $163,264 to $146,945. As a result, ‘unrestricted’ net position was restated from $69,697 to $63,999.
  • FY 2009‐10 ‘restricted’ governmental activities net position was restated from $157,052 to $167,215 in FY 2010‐11. As a result, ‘unrestricted’ governmental activities net position decreased from $53,229 to $43,066.
  • Accounting standards require that net position be reported in three components in the financial statements: net investment in capital assets; restricted; and unrestricted. Net position is considered restricted when 1) externally imposed by creditors (such as debt covenants), grantors, contributors, or laws or regulations of other governments or 2) imposed by law through constitutional provisions or enabling legislation.

168

COUNTY OF SANTA BARBARA, CALIFORNIA CHANGES IN NET POSITION (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (accrual basis of accounting)

Expenses

Governmental activities: Policy & executive
Public safety
Health & public assistance Community resources &

public facilities General government &

support services
General county programs Interest on long‐term debt

Subtotal governmental activities activities

Business‐type activities: Resource Recovery Laguna Sanitation Other

Subtotal business‐type activities expenses

Total expenses

Program revenues

Governmental activities:
Charges for services
Operating grants & contributions Capital grants & contributions

Subtotal governmental activities

Business‐type activities: Charges for services Resource Recovery

Laguna Sanitation

Other
Operating grants & contributions Capital grants & contributions

Subtotal business‐type activities

Total program revenues

Net (expense) / revenue

Governmental activities Business‐type activities Total net expense

General revenues and other changes in net position

Governmental activities: Taxes

Property taxes
Motor vehicle in‐lieu tax Sales taxes
Transient occupancy tax

Unrestricted investment earnings Extraordinary item and special item Transfers
Other

Subtotal governmental activities

Business‐type activities: Unrestricted investment earnings Transfers
Other

Subtotal business‐type activities Total primary government

Extraordinary Items

RDA dissolution transactions

Changes in net position

Governmental activities Business‐type activities Total primary government

$

2005-06

7,353 209,089 258,369

71,200

30,818 15,530 4,880

597,239

19,356 4,870 57

24,283 621,522

158,764 260,905 754

420,423

21,743 5,513 9 1,410 —

28,675 449,098

(176,816) 4,392 (172,424)

176,748 3,745 15,743 5,631 4,308 — 55 5,702 211,932

942 (55) 573

1,460 213,392

35,116 5,852 40,968

$

2006-07

8,569 222,752 271,806

84,785

36,771 14,734 2,889

642,306

21,857 5,066 62

26,985 669,291

174,263 274,169 476

448,908

21,511 5,950 9 854 —

28,324 477,232

(193,398) 1,339 (192,059)

195,001 271 17,286 6,591 2,867 — 3 8,842 230,861

2,089 (3)

1,046

3,132 233,993

37,463 4,471 41,934

$

2007-08

9,069 246,097 292,094

83,293

35,743 14,461 2,626

683,383

22,042 5,113 384

27,539 710,922

182,574 281,421 229

464,224

22,454 6,276 52 1,745 —

30,527 494,751

(219,159) 2,988 (216,171)

205,822 — 16,362 7,174 2,926 —

(5) 8,066 240,345

1,796 5 193 1,994 242,339

21,186 4,982 26,168

$

2008-09

8,596 251,027 287,178

84,585

32,115 23,167 3,321

689,989

23,226 5,609 682

29,517 719,506

180,183 291,171 259

471,613

20,854 6,464 34 2,678 1,169

31,199 502,812

(218,376) 1,682 (216,694)

205,583 — 15,643 6,431 1,610 — 661 12,212 242,140

1,248 (661) 397

984 243,124

23,764 2,666 26,430

$

2009-10

7,356 247,228 297,590

85,914

31,750 19,494 4,645

693,977

21,659 5,633 10

27,302 721,279

175,003 293,672 85

468,760

20,157 6,827 — 2,778 —

29,762 498,522

(225,217) 2,460 (222,757)

207,169 — 13,444 5,950 2,404 —

(995) 10,559 238,531

374

995 (126)

1,243 239,774

13,314 3,703 17,017

$

2010-11

11,074 263,133 308,149

83,770

31,123 20,694 4,926

722,869

21,258 5,946 —

27,204 750,073

176,149 306,564 209

482,922

21,151 7,304 — 1,245 —

29,700 512,622

(239,947) 2,496 (237,451)

208,595 — 12,756 6,977 1,372 — 1,002 11,877 242,579

286 (1,002) 1 (715)

241,864 — 2,632

1,781 4,413

$

2011-12

11,635 270,541 304,747

88,871

28,965 15,077 4,146

723,982

20,601 5,793 —

26,394 750,376

162,702 308,610 57

471,369

21,370 7,688 — 6,202 —

35,260 506,629

(252,613) 8,866 (243,747)

186,047 931 14,700 7,570 1,048 — 6 39,268 249,570

290 (6)

17 301 249,871

16,345

13,302 9,167 22,469

$

2012-13

14,455 271,326 307,239

89,382

29,585 5,664 3,712

721,363

20,529 6,181 —

26,710 748,073

155,451 325,138 50

480,639

22,381 8,662 — 1,732 —

32,775 513,414

(240,724) 6,065 (234,659)

227,452 187 13,527 6,993 453 — 2 8,419 257,033

(95) (2) 38 (59)

256,974 — 16,309

6,006 22,315

$

2013-14

14,057 282,251 319,565

92,377

33,931 3,980 3,505

749,666

20,300 6,176 —

26,476 776,142

173,875 332,533 52,352

558,760

23,439 9,907 — 1,038 —

34,384 593,144

(190,906) 7,908 (182,998)

231,247 155 14,039 7,539 1,407 —

(34) 8,100 262,453

344 13 34 391 262,844

71,547 8,299 79,846

$

2014-15

10,721 276,688 335,132

88,788

37,766 2,462 2,651

754,208

26,250 6,270 —

32,520 786,728

184,591 346,620 44

531,255

23,184 11,069 — 987 —

35,240 566,495

(222,953) 2,720 (220,233)

244,139 150 15,306 8,550 1,661 — — 8,474 278,280

254 —

(38) 216 278,496

55,327 2,936 58,263

$ $

$ $

$ $

$ $

$ $

$ $

$ $

$ $

$ $

$ $

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

$

$ $

169

COUNTY OF SANTA BARBARA, CALIFORNIA
FUND BALANCES, GOVERNMENTAL FUNDS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands)
(modified accrual basis of accounting)

General Fund (1)

Reserved for:
Receivables and prepaids Imprest cash
Property tax loss reserve

Unreserved: Designated Undesignated

Nonspendable Restricted Committed Assigned Unassigned

Subtotal General Fund

All Other Governmental Funds (2)

Reserved for:
Receivables and prepaids Imprest cash
Debt service
MHSA prudent reserve Property held for resale

Unreserved:
Designated, reported in:

Special revenue funds Capital projects fund Debt service fund

Undesignated, reported in: Special revenue funds Capital projects fund Debt service fund

Nonspendable Restricted Committed Assigned Unassigned

Subtotal all other governmental funds

Total governmental fund balance

Notes:

2005‐06 2006‐07

$ 4,094 $ 3,309 15 15 5,044 5,632

43,481 58,488 16,206 11,484 — — — — — — — — — — 68,840 78,928

2,378 390 24 22 7,592 7,601 — — — —

52,041 54,569 24,370 22,854 — 315

66,358 70,799 3,868 6,411 — — — — — — — — — — — —

156,631 162,961 $ 225,471 $ 241,889

2007‐08

20,309 15 6,057

56,447 5,311 — — — — — 88,139

503 23 9,333 — 2,600

51,745 15,985 230

80,838 4,988 (15,134)

— — — — —

151,111 $ 239,250

2008‐09

20,309 15 6,373

55,741 2,150 — — — — — 84,588

482 25 9,062 1,900 6,039

52,557 13,038 422

85,181 5,339 (15,724)

— — — — —

158,321 $ 242,909

2009‐10

— 26,704 8,271 53,444 — 736 89,155

— — — — —

— — —

— — —

507 180,115 16,590 932 22,860

221,004 $ 310,159

2010‐11

$ — — —

— 25,570 7,844 46,096 — 4,330 83,840

— — — — —

— — —

— — —

681 182,036 13,623 883

(26,600) 170,623 $ 254,463

2011‐12

— 8,780 17,536 52,002 — 7,591 85,909

— — — — —

— — —

— — —

586 149,010 9,604 1,817

(2,822) 158,195 $ 244,104

2012‐13

$ — — —

— 9,618 19,800 50,298 — 8,092 87,808

— — — — —

— — —

— — —

1,084 145,842 18,930 1,287

(2,850) 164,293 $ 252,101

2013‐14

$ — — —

— 10,138 21,245 58,018 — 3,405 92,806

— — — — —

— — —

— — —

791 151,021 18,630 — —

170,442 $ 263,248

2014‐15

$ — — —

— 11,042 22,946 61,887 — 3,242 99,117

— — — — —

— — —

— — —

1,129 162,156 18,642 — —

181,927 $ 281,044

$

$

$

— — —

$

— — —

(1) In FY 2010‐11 the County implemented GASB Statement No. 54 under which governmental fund balances are reported as nonspendable, restricted, committed, assigned, and unassigned. FY 2009‐10 fund balances have been recharacterized to comply with GASB 54 in order to facilitate year‐to‐year comparisons

(2) Substantial increases or decreases in fund balance components are explained in the Management’s Discussion and Analysis (MD&A).

170

COUNTY OF SANTA BARBARA, CALIFORNIA
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands)
(modified accrual basis of accounting)

2005‐06

202,078 14,094 12,020 10,783

263,025 134,664 15,255 651,919

10,824 198,332 260,562

78,085 46,686 12,574

6,582

4,741 11,029 629,415

22,504

118,235 (118,419)

862 1,953 — — — 2,631

— 25,135

1.86%

2005‐06

9,615 11,323 21,601

$ 629,415

2006‐07

220,583 14,336 11,020 13,025

266,953 148,311 13,414 687,642

11,846 214,747 273,314

90,994 47,380 14,552

7,876

2,930 10,620 674,259

13,383

128,567 (129,201)

1,269 2,400 — — — 3,035

16,418 1.66%

2006‐07

2007‐08

231,955 14,294 12,333 12,173

271,211 156,648 13,637 712,251

13,290 231,239 287,957

89,859 48,356 18,452

6,595

2,642 20,055 718,445

(6,194)

149,323 (148,765)

2008‐09

232,781 13,643 13,218

8,739 286,846 163,332 16,614 735,173

13,971 237,160 287,110 106,471

50,736 22,822

6,230 3,324 7,017

734,841 332

139,021 (138,722)

2009‐10

231,648 13,223 13,527

6,121 290,440 162,525 17,046 734,530

13,266 233,156 298,239 100,047

48,818 18,449

7,506 4,637 8,639

732,757 1,773

146,179 (146,991)

52 20,387 —

(148) 278

2010‐11

234,354 12,639 13,299

4,582 304,347 164,630 22,872 756,723

15,661 248,359 307,900

97,672 47,073 18,957

5,621

4,918 18,094 764,255

(7,532)

88,586 (91,204)

174 — — — —

2011‐12 (restated)

2012‐13

249,414 14,011 9,582 2,321 321,765 135,625 19,582 752,300

15,349 259,968 304,982 100,838

43,691 5,091

4,133 3,518 7,290

744,860 7,440

86,395 (86,338)

500 — — — — 557

— 7,997

1.07%

2012‐13

$ 64,886 302,982 29,814 155,560 139,800 3,199 10,504 7,651 30,464 $ 744,860

2013‐14

254,177 14,030 10,883

4,995 380,785 141,839 20,804 827,513

15,408 270,605 317,322 145,572

44,194 8,199

4,502 3,308 7,079

816,189 11,324

49,715 (49,965)

73 — — — —

(177)

— 11,147

1.06%

2013‐14

2014‐15

269,412 13,660 9,581 4,902 340,807 161,637 19,033 819,032

15,563 281,211 343,584

93,443 47,357 3,190

15,318 2,516 8,353

810,535 8,497

60,305 (61,278)

347 9,925 — — — 9,299

— 17,796

2.28%

2014‐15

$ 64,462 328,238 25,750 171,631 159,753 3,132 12,811 17,834 26,924 $ 810,535

Revenues (by source)

Taxes
Licenses, permits, and franchises Fines, forfeitures, and penalties Use of money and property Intergovernmental
Charges for service
Other

Total revenues

Expenditures (by function)

Policy & executive
Public safety
Health & public assistance
Community resources & public facilities General government & support services General county programs
Debt service

Principal

Interest Capital outlay

Total expenditures

Excess (deficiency) of revenues over (under) expenditures

Other financing sources (uses)

Transfers in
Transfers out
Proceeds from sale of capital assets Long‐term debt issued
Long‐term receivable collected Issuance discount on long‐term debt Issuance premium on long‐term debt

Total other financing sources (uses)

Extraordinary Items

RDA dissolution transactions

Net change in fund balance

Debt service as a percentage of noncapital expenditures:

Expenditures (1)

$

$

$

$

$

$

$

241,142 12,966 10,990

4,307 306,609 139,685 25,920 741,619

15,172 250,145 300,536

97,130 42,643 12,287

23,749 4,183 15,795 761,640

(20,021)

96,986 (96,912)

220 16,957 356 — — 17,607

(13,092) (2,414)

3.85%

2011‐12

$

$

$

288 147 17,000 — — — (88) — — — 17,758 446

— —

19,757 (2,444)

$

$

$

$

$

$

11,564 1.36%

2007‐08

$

$ 64,020 299,802 32,301 155,148 130,962 3,223 11,232 9,555 28,598 $ 734,841

$

$

— 21,530

1.72%

2009‐10

— (9,976)

1.46%

2010‐11

$

$

$

$

$

$

778 1.35%

2008‐09

$

$

General government
Public protection
Public ways and facilities
Health and sanitation
Public assistance
Education 2,773

Recreational and cultural services Debt service
Capital outlay

Total expenditures

Notes:

(1) By State Controller function.

53,409 242,782 31,890 139,106 116,916

65,106 259,208 30,926 149,855 120,572 2,894 10,462 10,807 24,429 $ 674,259

65,271 281,771 23,117 160,095 125,547 3,269 11,941 9,237 38,197 $ 718,445

62,761 288,599 32,111 157,155 138,166 3,289 12,899 12,144 25,633 $ 732,757

64,450 296,982 32,489 157,961 145,085 3,410 11,089 10,539 42,250 $ 764,255

48,395 303,442 35,540 157,298 138,397 2,734 10,866 27,933 37,035 $ 761,640

65,289 316,926 28,226 157,460 148,702 3,128 11,422 7,809 77,227 $ 816,189

171

COUNTY OF SANTA BARBARA, CALIFORNIA
ASSESSED VALUE OF TAXABLE PROPERTY AND ACTUAL VALUE OF PROPERTY (UNAUDITED) LAST TEN FISCAL YEARS (in thousands)

Due to the 1978 passage of the property tax initiative Proposition 13 (Prop 13), the County does not track the estimated actual value of all County properties. Under Prop 13, property is assessed at the 1978 market value with an annual increase limited to the lesser of 2% or the consumer price index (CPI) on properties not involved in a change of ownership or properties that did not undergo new construction. Newly acquired property is assessed at its new market value (usually the purchase price) and the value of any new construction is added to the existing base value of a parcel. As a result, similar properties can have substantially different assessed values based on the date of purchase. Additionally, Prop 13 limits the property tax rate to 1% of assessed value plus the rate necessary to fund local voter-approved bonds and special assessments.

Fiscal Year

  1. 2005  – 2006
  2. 2006  – 2007
  3. 2007  – 2008
  4. 2008  – 2009
  5. 2009  – 2010
  6. 2010  – 2011
  7. 2011  – 2012
  8. 2012  – 2013
  9. 2013  – 2014
  10. 2014  – 2015

Notes:

(1) Secured

$ 47,838,453 52,791,691 56,836,827 59,457,127 60,136,238 60,558,017 61,739,881 62,696,346 65,478,241

(5)

$

(2) Unsecured

2,458,096 2,546,922 2,571,180 2,795,296 2,874,141 2,901,856 2,923,496 2,896,396 2,897,317

(5)

$

(3) Unitary

737,982 $ 769,814 833,438 806,086 718,678 746,117 807,247 883,587 897,504

(5)

(4) Exempt

(1,544,353) (1,587,094) (1,772,777) (1,928,671) (2,128,966) (2,322,086) (2,713,216) (3,074,291) (3,308,629)

(5)

$

Total Taxable Assessed Value

49,490,178 54,521,333 58,468,668 61,129,838 61,600,091 61,883,904 62,757,408 63,402,038 65,964,433 69,464,980

Total Direct Tax Rate (%)

1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000

  1. (1)  Local assessed secured property is generally real property, defined as land, mines, minerals, timber, and improvements such as buildings, structures, crops, trees, and vines.
  2. (2)  Unsecured property is generally personal property including machinery, equipment, office tools, and supplies.
  3. (3)  Unitary properties are railroads and utilities crossing the County and are assessed by the State Board of Equalization. Most of the amount

    reported is unitary but includes a small amount of other state‐assessed property.

  4. (4)  Exempt properties include numerous full and partial exclusions/exemptions provided by the State Constitution and the legislature that relieve

    certain taxpayers from the burden of paying property taxes.

  5. (5)  Data is unavailable at time of print.

$75,000,000 $70,000,000 $65,000,000 $60,000,000 $55,000,000 $50,000,000 $45,000,000

Total Taxable Assessed Value

Last Ten Fiscal Years

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11 2011‐12 2012‐13 2013‐14 2014‐15 Fiscal Year Ending June 30

Source:

Auditor‐Controller, County of Santa Barbara

172

Taxable Assessed Value (in thousands)

COUNTY OF SANTA BARBARA, CALIFORNIA
PROPERTY TAX RATES ‐ DIRECT AND OVERLAPPING GOVERNMENTS (UNAUDITED) ($1 PER $100 OF ASSESSED VALUE)
LAST TEN FISCAL YEARS

Fiscal Year

2005 – 2006 2006 – 2007 2007 – 2008 2008 – 2009 2009 – 2010 2010 – 2011 2011 – 2012 2012 – 2013 2013 – 2014 2014 – 2015

Notes:

County Direct Rates

Santa Barbara County General

1.00000% 1.00000% 1.00000% 1.00000% 1.00000% 1.00000% 1.00000% 1.00000% 1.00000% 1.00000%

Overlapping Rates
Schools (2)

Cities (1)

0.00014% 0.00013% 0.00012% 0.00010% 0.00012% 0.00012% 0.00014% 0.00012% 0.00013% 0.00012%

0.01053% 0.01237% 0.01375% 0.01307% 0.01265% 0.01284% 0.01310% 0.01352% 0.01462% 0.01473%

Total

1.01067% 1.01250% 1.01387% 1.01317% 1.01277% 1.01296% 1.01324% 1.01364% 1.01475% 1.01485%

  1. (1)  Rates shown represent a weighted average of the eight incorporated cities within the County.
  2. (2)  Rates shown represent a weighted average of the various school district tax rate areas within the County.

Source:

Auditor‐Controller, County of Santa Barbara

173

COUNTY OF SANTA BARBARA, CALIFORNIA PRINCIPAL PROPERTY TAXPAYERS (UNAUDITED) June 30, 2015 AND June 30, 2006 (in thousands)

In accordance with GASB Statement No. 44, the following tables present information for the County’s principal property taxpayers as of June 30, 2014 and June 30, 2005

June 30, 2015 (3):

Taxpayers

Venoco, Inc.
Southern California Edison Co. Breitburn Energy Holdings, LLC Exxon Corporation
Southern California Gas Co.
1260 BB Property, LLC (Biltmore) ERG Resources
Fairway BB Property, LLC
Pacific Gas & Electric Co.
Celite Corporation

Ten largest taxpayers All other taxpayers

Total

June 30, 2006:

Exxon Corporation
Verizon California Inc.
Southern California Gas Co Bacara Resort & Spa
Pacific Offshore Pipeline Co Biltmore Hotel
Southern California Edison Co. Pase Nuevo ‐ Santa Barbara RDA Beringer Wine Estates Company Tara II, LLC

Ten largest taxpayers All other taxpayers

Total

Notes:

Type of Business

Petroleum & Utility

Petroleum & Petroleum &

Utility Hotel

(1)
Net Assessed Secured Property Value

Percentage of Total Net Assessed Value

0.68% 0.46% 0.44% 0.44% 0.28% 0.28% 0.26% 0.25% 0.21% 0.18% 3.48% 96.52% 100.00%

Percentage of Total Net

Assessed Value

0.78% 0.37% 0.32% 0.27% 0.25% 0.23% 0.20% 0.18% 0.18% 0.18% 2.96% 97.04% 100.00%

(2)
Total Secured Tax Levy Fiscal Year 2013‐14

Percentage of Total Secured Tax Levy Fiscal Year 2013‐14

0.72% 0.55% 0.50% 0.46% 0.34% 0.34% 0.28% 0.26% 0.25% 0.23% 3.93% 96.07% 100.00%

Percentage of Total Secured Tax Levy Fiscal Year 2004-05

0.78% 0.39% 0.34% 0.29% 0.25% 0.27% 0.21% 0.19% 0.40% 0.18% 3.32% 96.68% 100.00%

Petroleum & Residential Estate

Utility Mining

Type of Business

Petroleum & Gas Utility Utility Hotel Petroleum & Gas Hotel Utility Retail Agrictulture Residential

Gas $ Gas

Gas

428,595 292,984 278,024 278,592 180,086 175,000 162,437 156,591 132,162 116,020

2,200,491 61,030,714 63,231,205

$

4,538 3,455 3,156 2,861 2,126 2,113 1,744 1,615 1,559 1,420

24,587 601,671 626,258

Gas

$

$

Taxpayers

(1)
Net Assessed Secured Property Value

(2)
Total Secured Tax Levy Fiscal Year 2004-05

$

364,723 171,760 151,360 127,500 116,773 108,000

94,090 85,174 84,858 84,683

1,388,921 45,643,161 47,032,082

$

3,648 1,830 1,595 1,353 1,168 1,260

998

885 1,878 861 15,476 451,021 466,497

$

$

  1. (1)  Net Assessed Secured amounts include Secured & Unitary less exemptions.
    See “Assessed Value of Taxable Property and Actual Value of Property” schedule for total assessed value.
  2. (2)  Includes 1%, bonds, fixed charges, late penalties and costs (Only Secured & Unitary Tax Levy amounts).
  3. (3)  Data is unchanged from June 30, 2014 due to unavailability at time of print.

Source:

County of Santa Barbara Treasurer / Tax Collector

174

COUNTY OF SANTA BARBARA, CALIFORNIA
PROPERTY TAX LEVIES and COLLECTIONS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands)

(3) Fiscal Year

  1. 2005  – 2006
  2. 2006  – 2007
  3. 2007  – 2008
  4. 2008  – 2009
  5. 2009  – 2010
  6. 2010  – 2011
  7. 2011  – 2012
  8. 2012  – 2013
  9. 2013  – 2014
  10. 2014  – 2015

Notes:

(1) Taxes Levied

$ 466,142 515,896 554,778 577,849 580,532 579,901 590,345 599,416 626,258 626,258

$

(2)
Collections within the fiscal year of the levy Amount % of Levy

460,163 98.72% 505,135 97.91% 541,456 97.60% 561,907 97.24% 566,808 97.64% 573,537 98.90% 583,214 98.79% 593,841 99.07% 621,794 99.29% 621,794 99.29%

$

Collections in Subsequent Years

5,858 $ 10,619 13,099 15,121 12,370

4,918 5,559 3,581

– –

Total Collections to Date Amount % of Levy

466,021 99.97% 515,754 99.97% 554,555 99.96% 577,028 99.86% 579,178 99.77% 578,455 99.75% 588,773 99.73% 597,422 99.67% 621,794 99.29% 621,794 99.29%

  1. (1)  Secured and Unitary tax levy for the County itself, school districts, cities, and special districts under the supervision of their own governing boards.
  2. (2)  Included are amounts collected by the County on behalf of itself, school districts, cities, and special districts under the supervision of their own governing boards.
  3. (3)  Data is unchanged from June 30, 2014 due to unavailability at time of print.

Source:

Auditor‐Controller, County of Santa Barbara

175

COUNTY OF SANTA BARBARA, CALIFORNIA
RATIOS OF OUTSTANDING DEBT BY TYPE (UNAUDITED) LAST TEN FISCAL YEARS (in thousands, except per capita)

Fiscal Year

  1. 2005  ‐ 2006
  2. 2006  ‐ 2007
  3. 2007  ‐ 2008
  4. 2008  ‐ 2009
  5. 2009  ‐ 2010
  6. 2010  ‐ 2011
  7. 2011  ‐ 2012
  8. 2012  ‐ 2013
  9. 2013  ‐ 2014
  10. 2014  ‐ 2015

Notes:

Capital Leases

Total Primary Government

Certificates of Participation (1)

Governmental Activities Long-

Business-Type Activities Certificates

Long- Term Term Settle- Loans ment

$ 1,030 $ 200 11 — — — — — — — — — — — — — — — — —

Bonds and Notes Payable

$47,000 — — — — — 22,195 19,740 17,070 14,800

of Participation (1)

Capital Leases

$ 83 30 23 15 8 — — — —

Long-Term Settlement

Bonds and Notes Payable

$ 8,231
7,833 77,368 7,426 92,584 7,009 84,646 6,581 95,128

10,314 92,622 9,637 88,551 8,928 82,720 8,203 76,481 7,462 69,339

Percentage of Personal Income (2)

0.71% 0.40% 0.47% 0.44% 0.49% 0.49% 0.47% 0.43% 0.37% 0.32%

Per Capita (3)

$ 310 180 214 195 218 216 207 193 177 159

$

66,172 60,018 70,877 65,069 76,824 68,759 44,840 43,161 41,414 38,330

$

3,301 5,015 4,301 3,707 4,782 4,017 3,735 3,418 3,013 2,686

$

5,689 4,351 9,902 8,846 6,933 9,532 8,144 7,473 6,781 6,061

$

165 110 55 — — — — — —

$ 131,871

  1. (1)  Beginning in fiscal year 2013-14, the Certifcates of Particpation totals in
  2. (2)  See the “Demographics and Economic Statistics” schedule for personal

this schedule were updated to included unamortized premiums and discounts.
income and population data. Note that this ratio is calculated using population for the latest calendar

year for each corresponding fiscal year.
(3) See the “Demographics and Economics Statistics” schedule for population figures. Note that this ratio is calculated using population for the latest calendar year for each

corresponding fiscal year.

Source:

Auditor-Controller, County of Santa Barbara

176

COUNTY OF SANTA BARBARA, CALIFORNIA COMPUTATION OF LEGAL DEBT MARGIN (UNAUDITED) LAST TEN FISCAL YEARS (in thousands)

(3)
(1) (2) Total Net Legal Debt

Fiscal Year Assessed Value Legal Debt Limit Applicable Debt Margin

Legal Debt Margin / Debt Limit

  1. 2005  ‐ 2006
  2. 2006  ‐ 2007
  3. 2007  ‐ 2008
  4. 2008  ‐ 2009
  5. 2009  ‐ 2010
  6. 2010  ‐ 2011
  7. 2011  ‐ 2012
  8. 2012  ‐ 2013
  9. 2013  ‐ 2014
  10. 2014  ‐ 2015

Notes:

$

49,490,178 54,521,333 58,468,668 61,129,838 61,600,091 61,883,904 62,757,408 63,402,039 65,964,432 69,453,967

$

618,627 $ 681,517 730,858 764,123 770,001 773,549 784,468 792,525 824,555 868,175

— $ —

— — — — — —

618,627 100% 681,517 100% 730,858 100% 764,123 100% 770,001 100% 773,549 100% 784,468 100% 792,525 100% 824,555 100% 868,175 100%

  1. (1)  Assessed Value does not include tax exempt property. Property value data can be found in the “Assessed Value of Taxable Property and Actual Value of Property” schedule.
  2. (2)  California Government Code Section 29909 read in conjunction with Revenue and Taxation Code Section 135 imposes a legal debt limitation for General Obligation Bond indebtedness to 1.25% of the total full cash valuation.
  3. (3)  The legal debt margin is the County’s available borrowing authority under state finance statutes and is

calculated by subtracting the debt applicable to the legal debt limit from the legal debt limit.

Source:

Auditor‐Controller, County of Santa Barbara

177

COUNTY OF SANTA BARBARA, CALIFORNIA
DIRECT AND OVERLAPPING BONDED DEBT (UNAUDITED) AS OF June 30, 2015

2014‐2015 Assessed Valuation: $ 69,453,967

Overlapping Tax and Assessment Debt: (1)
Allan Hancock Joint Community College District 99.632% Santa Barbara Community College District 100% High School Districts 99.997-100% Unified School Districts 100% Goleta Union School District 100% Santa Barbara School District 100% Santa Maria‐Bonita Joint School District 99.995% Other School District 100% Lompoc Healthcare District 100% Special District 1915 Act Bonds 62.113-100%

Total Overlapping Tax and Assessment Debt

Overlapping General Fund Obligation Debt:

Santa Maria‐Bonita School District Certificates of Participation 99.995% Santa Ynez Valley Union High School District Certificates of Participation 100% Santa Maria Joint Union High School District Certificates of Participation 99.997% Buellton School District Certificates of Participation 100% College School District Certificates of Participation 100% City of Carpinteria Certificates of Participation 100% City of Santa Barbara Certificates of Participation 100% City of Santa Maria General Fund Obligations 100% Carpinteria Sanitary District General Fund Obligations 98.004% Santa Maria Cemetery District Certificates of Participation 100%

Total Gross Overlapping General Fund Obligation Debt
Less: City of Santa Barbara revenue bonds supported by airport revenues
Less: Carpinteria Sanitary District revenue bonds supported by wastewater system revenues

Total Net Overlapping General Fund Obligation Debt
Total Net Overlapping Tax and Assessment and General Fund Obligation Debt

Overlapping Tax Increment Debt:

Direct General Fund Obligation Debt:

Santa Barbara County Certificates of Participation 100% Total Direct General Fund Obligation Debt

Total Net Combined Overlapping and Direct Debt Total Gross Combined Overlapping and Direct Debt

Ratio to 2014‐15 Assessed Valuation:
Total Overlapping Tax and Assessment Debt 0.97%

Ratios to Adjusted Assessed Valuation:
Combined Direct Debt 0.09% Gross Combined Total Debt 1.31% Net Combined Total Debt 1.23%

Notes:

$

Debt (3)

129,616 57,600 211,924 38,356 16,745 54,825 29,999 58,395 72,780 5,781 676,021

41,345 2,805 3,717

450 2,406 485 46,040 1,145 10,215 720 109,327

(44,570) (10,215) 54,542

730,564 63,375

59,260 59,260

853,199 907,983 (2)

Percent Applicable

$ $

(1) Percentage of overlapping agency’s assessed valuation located within the boundaries of the County.
(2) Excludes tax and revenue anticipation notes, revenue, mortgage revenue and tax allocation bonds, non‐bonded capital

lease obligations and state contractual obligations within the Department of Water Resources. (3) Debt as of July 28, 2015.

Source:

California Municipal Statistics, Incorporated

178

COUNTY OF SANTA BARBARA, CALIFORNIA DEMOGRAPHICS AND ECONOMIC STATISTICS (UNAUDITED) LAST FISCAL TEN YEARS (in thousands)

(1) (2) Year Population

  1. 2006  422
  2. 2007  424
  3. 2008  429
  4. 2009  431
  5. 2010  434
  6. 2011  426
  7. 2012  427
  8. 2013  429
  9. 2014  433
  10. 2015  437

$

(3),(4) Personal Income

18,300,000 18,900,000 19,100,000 18,100,000 18,600,000 19,000,000 19,000,000 19,300,000 20,600,000 21,700,000

Per Capita Personal Income

$ 43.4 44.6 44.5 42.0 42.9 44.6 44.5 45.0 47.6 49.7

(5) (6) School Unemployment

Enrollment Rate

67 3.5% 67 3.8% 66 5.2% 66 8.2% 66 8.8% 66 8.9% 66 7.9% 66 6.3% 67 5.4% 68 4.7%

Detail of estimated population, as of January 1, 2015 (whole numbers):

(2) Incorporated Cities Buellton

Carpinteria Goleta Guadalupe Lompoc Santa Barbara Santa Maria Solvang

Total of Incorporated

Total of Unincorporated Areas Total Population

Notes:

  1. (1)  Calendar year
  2. (2)  Population as of January 1
  3. (3)  Estimated amounts

4,931 13,547 30,765

7,205 43,479 91,088

102,087 5,489 298,591 139,052 437,643

Sources:

(2) California Department of Finance

  1. (4)  Bureau of Economic Analysis
  2. (5)  California Department of Education
  3. (6)  Employment Development Department Research Center

179

COUNTY OF SANTA BARBARA, CALIFORNIA PRINCIPAL EMPLOYERS (UNAUDITED) June 30, 2015 AND June 30, 2006

June 30, 2015

Company or Organization

University of California, Santa Barbara Vandenberg Air Force Base
County of Santa Barbara
Santa Barbara Cottage Hospital

Santa Barbara City College
Santa Barbara Unified School District City of Santa Barbara
Chumash Casino Resort
Marian Medical Center
Santa Maria‐Bonita School District

Total ten largest

Total all other
Total companies or organizations

Sources:

Jobs (1)

10,592 6,800 4,582 3,449 2,149 2,000 1,689 1,677 1,600 1,452

Percent of Total County Employment

4.94% 3.17% 2.14% 1.61% 1.00% 0.93% 0.79% 0.78% 0.75% 0.68%

June 30, 2006

Company or Organization

University of California, Santa Barbara Vandenberg Air Force Base
County of Santa Barbara
Santa Barbara School District Admin. Santa Barbara Cottage Hospital

Santa Barbara City College
Allan Hancock College
Raytheon Electronic Systems Santa Maria‐Bonita School District Lompoc Unified School District

Total ten largest

Total all other
Total companies or organizations

Jobs (2)

9,578 4,782 4,144 2,800 2,464 2,241 2,200 1,923 1,718 1,478

33,328 154,805 188,133

Percent of Total County Employment

5.09% 2.54% 2.20% 1.49% 1.31% 1.19% 1.17% 1.02% 0.91% 0.79% 17.71% 82.29% 100.00%

35,990 16.79% 178,310 83.21% 214,300 100.00%

(1) California Economic Forecast Project
(2) County of Santa Barbara CAFR FY 2005‐06

180

COUNTY OF SANTA BARBARA, CALIFORNIA
COUNTY EMPLOYEES BY FUNCTION/PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

88 98 99 91 85 93 1,632 1,646 1,666 1,617 1,556 1,524 1,706 1,688 1,704 1,654 1,765 1,779

524 502 506 476 451 432

436 432 438 437 410 385 34 40 34 31 30 15 91 90 90 91 85 83 15 15 15 16 16 16

4,526 4,511 4,552 4,413 4,398 4,327

87 91 90 83 79 86 1,537 1,579 1,610 1,561 1,500 1,455 1,596 1,598 1,615 1,573 1,633 1,636

473 476 473 445 421 404

410 408 414 414 392 369 28 38 34 30 29 14 86 85 86 86 80 78 16 15 15 16 16 16

4,233 4,290 4,337 4,208 4,150 4,059

2011‐12 2012‐13

92 94 1,455 1,467 1,634 1,732

416 419

  343     334
   17       6
   81      79
   16      16

4,054 4,147

85 88 1,390 1,386 1,548 1,608

391 389

328 315 13 – 76 74 16 16

3,847 3,876

2013‐14 2014‐15

96 99 1,478 1,498 1,799 1,926

424 419

334 350 5 3 83 81 16 16 4,235 4,392

88 91 1,394 1,415 1,679 1,796

392 382

313 326 – 1 78 77 16 15 3,960 4,103

Paid employees (1)

Policy & executive
Public safety
Health & public assistance Community resources

& public facilities General government & support services

General county programs Resource Recovery Laguna Sanitation

Total County employees

Actual full‐time equivalent employees (2)

Policy & executive
Public safety
Health & public assistance Community resources

& public facilities General government & support services

General county programs Resource Recovery Laguna Sanitation

Total County employees

Note:

(1) Paid employees: Count of employees paid, including terminated employees. Employees with more than one job will be counted once for each job for which the employee was paid.

(2) Actual full-time equivalent employees: Count of number of full-time equivalents paid. For full-time and part-time, the full-time equivalent (FTE) used is from the employee’s assigned work schedule. For extra help and contractors, the FTE is calculated as the number of hours worked this pay period divided by 80.

4,400 4,300 4,200 4,100 4,000 3,900 3,800 3,700 3,600

Total Full‐Time Equivalent Employees

Last Ten Fiscal Years

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11 2011‐12 2012‐13 2013‐14 2014‐15 Fiscal Year Ending June 30

181

Full‐Time Equivalent Employees

COUNTY OF SANTA BARBARA, CALIFORNIA
OPERATING INDICATORS BY FUNCTION/PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS

Function/Program

Public Safety: Other:

Filed felonies‐District Attorney
Filed misdemeanors‐District Attorney Public Defender’s total new caseload Fire emergency responses

Sheriff:
Total miles patrolled
Processed and booked adult offenders

Probation:
Juvenile referrals processed
Adult and Juvenile cases supervised Institutional care for minors
Submit written reports to courts on Adults

Health & public assistance
ADMHS clients served
Established orders for child support Assistance claims paid to eligible recipients Patient encounters at Public Health clinics

Community resources & public facilities Building inspections
Enhanced or maintained road lanes (miles) Flood control work requests (1)

General government & support services Clerk‐Recorder‐Assessor

Recorded documents & vital copies issued

Resource Recovery
Waste recycled (tons per month) Landfill waste disposal (tons per month)

Note:

2005‐06

3,062 13,096 22,900

9,700

1,504,057 17,747

6,589 10,191 62,375

7,831

13,059 15,469 64,200

118,400

34,000 117 185

123,700

8,177 19,679

2006‐07

3,077 14,901 25,302 10,163

1,546,905 18,403

6,822 11,678 67,154

8,153

13,629 16,965 65,405

123,000

40,034 246 112

135,000

8,270 18,483

2007‐08

2,669 14,791 24,939 11,090

1,572,795 17,915

6,287 11,986 68,730

7,190

14,565 14,635 65,686

126,200

33,800 102 110

108,000

7,692 17,964

2008‐09

2,610 14,608 21,859 11,392

1,563,910 17,992

5,880 10,509 68,286

5,832

13,637 14,630 71,249

134,450

21,523 100 180

107,073

7,074 17,099

2009‐10

2,482 14,633 23,056 11,278

1,530,054 18,319

5,431 10,808 67,861

4,941

14,785 14,800 77,966

136,867

19,159 195 195

108,178

6,576 15,626

2010‐11

2,462 13,264 23,563 11,512

1,519,651 17,552

4,978

9,480 65,313 5,544

12,063 13,648 80,025

131,489

19,450 96 90

117,932

7,312 14,614

2011‐12

2,741 10,983 21,642 12,714

1,447,978 15,763

4,122

8,364 58,923 5,146

11,825 12,963 76,762

120,540

19,736 81 95

119,522

7,824 13,891

2012‐13

2,979 10,022 18,963 13,989

1,230,191 16,677

3,449

8,321 52,268 6,582

12,313 12,565 72,678

120,700

20,689 67

135,053

7,043 14,607

2013‐14

3,176

9,838 20,973 13,842

1,477,038 16,780

3,070

8,331 38,763 6,628

12,647 11,922 70,924

114,000

23,752 82

103,060

7,244 14,894

2014‐15

2,499 11,347 23,391 13,927

1,413,902 17,117

3,313

8,196 34,894 6,838

13,936 11,544 99,513

111,000

22,431 73

102,694

6,792 15,163

(1) Beginning in FY 2012‐13 Public Works no longer tracks flood control work requests.

182

COUNTY OF SANTA BARBARA, CALIFORNIA
CAPITAL ASSETS AND INFRASTRUCTURE STATISTICS BY FUNCTION/PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11 2011‐12 2012‐13 2013‐14

Occupied with general government and support services.

2014‐15

Function/Program

Policy & executive Buildings

Public safety
Courtbuildings 9977777777 Otherbuildings 5555555555 Fire stations 15 16 16 16 16 16 16 16 16 16 Fire trucks 41 42 41 43 42 42 42 42 42 42 Ambulances 4444446666 Sheriffsubstations 2223344444

Patrol units
Aircrafts
Jail and detention facilities Administration buildings

Health & public assistance Clinics

Administration buildings

49 49 49 49 49 49 49 49 49 52 5555666666 6666666666 8899999999

6777777777 5555555555

Community resources & public facilities
Public parks & open space acreage
Day use & camping parks
Open space areas (County developed)
Outdooreventscenter 1111111111 Veteransbuildings 3333333333 Seawalls 2222222222

2,243 21 17

Traffic signals
Roads heavy equipment
Sanitary sewers (miles of collection) Treatment capacity (million gallons per day) Resource Recovery heavy equipment

2,243 2,455 21 22 17 17

2,469 2,469 1,798 2,027 22 23 25 26 17 18 42 43

2,122 2,122 2122 26 26 26 45 45 45

Road lane miles 1,668 Bridges 112

1,685 1,685 1,685 1,670 112 112 113 113 26 26 26 43 49 51 51 51 121 121 121 121 4 4 4 4 82 84 73 78

1671 1,671 1671 115 115 115 44 44 44 43 43 43 129 129 129 4 4 4 72 69 57

1,668 1,668 112 112 25 25 25 43 48 51 160 160 111 4 4 4 65 69 69

General government & support services
Buildings 5555557777

Notes:

Buildings include those that are capitalized but exclude real property that is leased.

183

184

Glossary

Glossary

Glossary

ACCOUNTS PAYABLE ‐ A short‐term liability account reflecting amounts owed to private persons or organizations for goods and services received by a government.

ACCOUNTS RECEIVABLE ‐ An asset account reflecting amounts due from private persons or organizations for goods and services furnished by a government (but not including amounts due from other funds or other governments).

ACCRUAL BASIS OF ACCOUNTING ‐ The recording of the financial effects of a government of transactions and other events and circumstances that have cash consequences for the government in the periods in which those transactions, events, and circumstances occur, rather than only in the periods in which cash is received or paid by the government.

ACCUMULATED DEPRECIATION ‐ A contra‐asset account used to report the accumulation of periodic credits to reflect the expiration of the estimated service life of capital assets.

ACTIVE EMPLOYEES ‐ Individuals employed at the end of the reporting or measurement period, as applicable.

ACTUARIAL VALUATION ‐ The determination, as of a point in time (the actuarial valuation date), of the service cost, total pension liability, and related actuarial present value of projected benefit payments for pensions performed in conformity with Actuarial Standards of Practice unless otherwise specified by the GASB.

ACTUARIAL VALUATION DATE ‐ The date as of which an actuarial valuation is performed.

ACTUARIALLY DETERMINED CONTRIBUTION ‐ A target or recommended contribution to a defined benefit pension plan for the reporting period, determined in conformity with Actuarial Standards of Practice based on the most recent measurement available when the contribution for the reporting period was adopted.

ADVANCE FROM OTHER FUNDS ‐ A liability account used to record noncurrent portions of a long‐term loan from one fund to another fund within the same reporting entity. See DUE TO OTHER FUNDS and INTERFUND RECEIVABLE/PAYABLE.

ADVANCE TO OTHER FUNDS ‐ An asset account used to record noncurrent portions of a long‐term loan from one fund to another fund within the same reporting entity. See DUE FROM OTHER FUNDS and INTERFUND RECEIVABLE/PAYABLE.

AGENCY FUND ‐ A fund normally used to account for assets held by a government as an agent for individuals, private organizations, or other governments and/or other funds.

AGENT MULTIPLE‐EMPLOYER PLAN ‐ Group of single‐employer plans with pooled administrative and investment functions but separate actuarial valuations and contribution rates.

AMORTIZATION ‐ The portion of the cost of a limited‐life or intangible asset charged as an expense during a particular period. The reduction of debt by regular payments of principal and interest sufficient to retire the debt by maturity.

ANNUAL OPEB COST ‐ An accrual‐basis measure of the periodic cost of an employer’s participation in a defined benefit OPEB plan.

ANNUAL REQUIRED CONTRIBUTIONS (ARC) ‐ Term used in connection with other postemployment benefit plans to describe the amount an employer must contribute in a given year.

APPROPRIATION ‐ A legal authorization granted by a legislative body to make expenditures and to incur obligations for specific purposes. An appropriation usually is limited in amount and time it may be expended.

ASSESSED VALUATION ‐ A valuation set upon real estate or other property by a government as a basis for levying taxes.

ASSIGNED FUND BALANCE ‐ Amounts that are constrained by the County’s intent to be used for specific purposes. The intent can be established at either the highest level of decision‐making authority, or by a body or an official designated for that purpose. This is also the classification for residual funds in the County’s special revenue funds.

AUDITOR’S REPORT ‐ In the context of a financial audit, a statement by the auditor describing the scope of the audit and the auditing standards applied in the examination, and setting forth the auditor’s opinion on the fairness of presentation of the financial information in conformity with GAAP or some other comprehensive basis of accounting.

BALANCE SHEET ‐ The financial statement disclosing the assets, liabilities, and equity of an entity at a specified date in conformity with GAAP.

BASIC FINANCIAL STATEMENTS (BFS) ‐ The minimum combination of financial statements and note disclosures required for fair presentation in conformity with GAAP. Basic financial statements have three components: government‐wide financial statements, fund financial statements, and notes to the financial statements.

BASIS OF ACCOUNTING ‐ A term used to refer to when revenues, expenditures, expenses, and transfers, and the related assets and liabilities, are recognized in the accounts and reported in the financial statements. Specifically, it relates to the timing of the measurements made, regardless of the nature of the measurement, on either the cash or the accrual method.

BUDGET ‐ A plan of financial operation embodying an estimate of proposed expenditures for a given period and the proposed means of financing them. Used without any modifier, the term usually indicates a financial plan for a single fiscal year. The term “budget” is used in two senses in practice. Sometimes it designates the financial plan presented to the appropriating governing body for adoption, and sometimes, the plan finally approved by that body.

BUDGETARY CONTROL ‐ The control or management of a government or enterprise in accordance with an approved budget to keep expenditures within the limitations of available appropriations and available revenues.

BUSINESS‐TYPE ACTIVITIES ‐ One of two classes of activities reported in the government‐wide financial statements. Business‐type activities are financed in whole or in part by fees charged to external parties for goods and services. These activities are usually reported in enterprise funds.

CAPITAL ASSETS ‐ Long‐lived assets obtained or controlled as a result of past transactions, events, or circumstances. Capital assets include equipment, buildings, and improvements other than buildings; land; infrastructure; and intangible assets. In the private sector, these assets are referred to most often as property, plant and equipment, and intangible assets.

CAPITAL EXPENDITURES ‐ Expenditures resulting in the acquisition of or addition to the government’s general capital assets.

CAPITALIZATION POLICY ‐ The criteria used by a government to determine which outlays should be reported as capital assets.

CAPITAL LEASE ‐ An agreement that conveys the right to use property, plant, or equipment, usually for a stated period of time. See LEASE‐ PURCHASE AGREEMENTS.

CAPITAL PROJECTS FUND ‐ A fund created to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds).

County of Santa Barbara ~ Comprehensive Annual Financial Report for Year Ended June 30, 2015

185

Glossary

CASH BASIS OF ACCOUNTING ‐ A basis of accounting under which transactions are recognized only when cash is received or disbursed.

CASH WITH FISCAL AGENT ‐ An asset account reflecting deposits with fiscal agents, such as commercial banks, for the payment of bond principal and interest.

CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING PROGRAM ‐ A voluntary program administered by the GFOA to encourage governments to publish efficiently organized and easily readable CAFRs/CUFRs and to provide technical assistance and peer recognition to the finance officers preparing them.

CHANGE IN THE FAIR VALUE OF INVESTMENTS ‐ The difference between the fair value of investments at the beginning of the year and at the end of the year, taking into consideration investment purchases, sales, and redemptions.

CLOSED AMORTIZATION PERIOD ‐ Term used in connection with the unfunded actuarial accrued liability associated with defined benefit pension and other postemployment benefit plans. A specific number of years that is counted from one date and, therefore, declines to zero with the passage of time. For example, if the amortization period is initially 30 years on a closed basis, 29 years remain after the first year, 28 years after the second year, and so forth.

COLLECTIVE DEFERRED OUTFLOWS OF RESOURCES AND DEFERRED INFLOWS OF RESOURCES RELATED TO PENSIONS ‐ Deferred outflows of resources and deferred inflows of resources related to pensions arising from certain changes in the collective net pension liability.

COLLECTIVE NET PENSION LIABILITY ‐ The net pension liability for benefits provided through (1) a cost‐sharing pension plan or (2) a single‐employer or agent pension plan in circumstances in which there is a special funding situation.

COLLECTIVE PENSION EXPENSE ‐ Pension expense arising from certain changes in the collective net pension liability.

COMMITTED FUND BALANCE ‐ Amounts that can only be used for specific purposes determined by formal action of the County’s highest level of decision‐making authority (the Board of Supervisors) and that remain binding unless removed in the same manner. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period.

COMPENSATED ABSENCES ‐ Absences, such as vacation, illness, and holidays, for which it is expected employees will be paid. The term does not encompass severance or termination pay, postretirement benefits, deferred compensation, or other long‐term fringe benefits, such as group insurance and long‐term disability pay.

COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) ‐ A CAFR is a financial report that encompasses all funds and component units of the government. It contains (a) the basic financial statements and required supplementary information, (b) combining statements to support columns in the basic financial statements that aggregate information from more than one fund or component unit, and (c) individual fund statements as needed. It is the governmental unit’s official annual report and it also contains introductory information, schedules necessary to demonstrate compliance with finance‐related legal and contractual provisions, and statistical data.

CONTINGENT LIABILITY ‐ Items that may become liabilities as a result of conditions undetermined at a given date, such as guarantees, pending lawsuits, judgments under appeal, unsettled disputed claims, unfilled purchase orders, and uncompleted contracts. Contingent liabilities should be disclosed within the financial statements (including the notes) when there is a reasonable possibility a loss may have been incurred. Guarantees, however, should be disclosed even though the possibility of loss may be remote.

CONTRIBUTION DEFICIENCIES ‐ The difference between the annual required contributions (ARC) of the employer(s), and the employer’s actual contributions in relation to the ARC.

CONTRIBUTIONS ‐ Additions to a pension plan’s fiduciary net position for amounts from employers, nonemployer contributing entities (for example, state government contributions to a local government pension plan), or employees. Contributions can result from cash receipts by the pension plan or from recognition by the pension plan of a receivable from one of these sources.

COST‐OF‐LIVING ADJUSTMENTS ‐ Postemployment benefit changes intended to adjust benefit payments for the effects of inflation.

COST–SHARING MULTIPLE‐EMPLOYER PLAN ‐ A single plan with pooling (cost‐sharing) arrangements for the participating employers. All risks, rewards, and costs, including benefit costs, are shared and are not attributed individually to the employers. A single actuarial valuation covers all plan members and the same contribution rate(s) applies for each employer.

COVERED PAYROLL ‐ Term used in connection with defined benefit pension and other postemployment benefit plans to describe all elements of annual compensation paid to active employees on which contributions to a plan are based.

CURRENT FINANCIAL RESOURCES MEASUREMENT FOCUS ‐ Measurement focus according to which the aim of a set of financial statements is to report the near‐term (current) inflows, outflows, and balances of expendable (spendable) financial resources. The current financial resources measurement focus is unique to accounting and financial reporting for state and local governments and is used solely for reporting the financial position and results of operations of governmental funds.

DEBT ‐ An obligation resulting from the borrowing of money or from the purchase of goods and services. Debts of governments include bonds, time warrants, and notes.

DEBT SERVICE FUND ‐ A fund established to account for the accumulation of resources for, and the payment of, general long‐term debt principal and interest.

DEFERRED CHARGES ‐ Expenditures that are not chargeable to the fiscal period in which they were made but that are carried as an asset on the balance sheet, pending amortization or other disposition (e.g., bond issuance costs). Deferred charges differ from prepaid items in that they usually extend over a long period of time (more than five years) and are not regularly recurring costs of operation.

UNEARNED REVENUES ‐ Resource inflows that do not yet meet the criteria for revenue recognition. In governmental funds, earned amounts also are reported as unearned revenue until they are available to liquidate liabilities of the current period.

DEFICIT ‐ (1) The excess of the liabilities of a fund over its assets. (2) The excess of expenditures over revenues during an accounting period or, in the case of proprietary funds, the excess of expenses over revenues during an accounting period.

DEFINED BENEFIT OPEB PLAN ‐ Plan having terms that specify the amount of benefits to be provided at or after separation from employment. The benefits may be specified in dollars (for example, a flat dollar payment or an amount based on one or more factors such as age, years of service, and compensation), or as a type or level of coverage (for example, prescription drugs or a percentage of healthcare insurance premiums).

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DEFINED BENEFIT PENSION PLAN ‐ A pension plan having terms that specify the amount of pension benefits to be provided at a future date or after a certain period of time; the amount specified usually is a function of one or more factors such as age, years of service, and compensation.

DEPRECIATION ‐ (1) Expiration in the service life of capital assets, other than wasting assets, attributable to wear and tear, deterioration, action of the physical elements, inadequacy, and obsolescence. (2) The portion of the cost of a capital asset, other than a wasting asset, charged as an expense during a particular period. In accounting for depreciation, the cost of a capital asset, less any salvage value, is prorated over the estimated service life of such an asset, and each period is charged with a portion of such cost. Through this process, the entire cost of the asset is ultimately charged off as an expense.

DISCOUNT RATE ‐ The single rate of return that, when applied to all projected benefit payments, results in an actuarial present value of projected benefit payments equal to the total of the following:

1. The actuarial present value of benefit payments projected to be made in future periods in which (a) the amount of the pension plan’s fiduciary net position is projected to be greater than the benefit payments that are projected to be made in that period and (b) pension plan assets up to that point are expected to be invested using a strategy to achieve the long‐term expected rate of return, calculated using the long‐term expected rate of return on pension plan investments.

2. The actuarial present value of projected benefit payments not included in (1), calculated using the municipal bond rate.

DUE FROM OTHER FUNDS ‐ An asset account reflecting amounts owed to a particular fund by another fund for goods sold or services rendered. This account includes only short‐term obligations on open account, not interfund loans.

DUE TO OTHER FUNDS ‐ A liability account reflecting amounts owed by a particular fund to another fund for goods sold or services rendered. This account includes only short‐term obligations on open account, not interfund loans.

ECONOMIC RESOURCES MEASUREMENT FOCUS ‐ Measurement focus under which the aim of a set of financial statements is to report all inflows, outflows, and balances affecting or reflecting an entity’s net position. The economic resources measurement focus is used for proprietary and fiduciary funds, as well as for government‐wide financial reporting. It is also used by business enterprises in the private sector.

EMPLOYER’S CONTRIBUTIONS ‐ Term used in the context of pension and other postemployment benefits to describe contributions actually made by the employer in relation to the annual required contribution (ARC) of the employer. (Only amounts paid to trustees and outside parties qualify.)

ENCUMBRANCES ‐ Commitments related to unperformed (executory) contracts for goods or services. Used in budgeting, encumbrances are not GAAP expenditures or liabilities, but represent the estimated amount of expenditures ultimately to result if unperformed contracts in process are completed.

ENTERPRISE FUND ‐ Proprietary fund type used to report an activity for which a fee is charged to external users for goods and services.

ENTRY AGE ACTUARIAL COST METHOD ‐ A method under which the actuarial present value of the projected benefits of each individual included in an actuarial valuation is allocated on a level basis over the earnings or service of the individual between entry age and assumed exit age(s). The portion of this actuarial present value allocated to a valuation year is called the normal cost. The portion of this actuarial present value not provided for at a valuation date by the actuarial

present value of future normal costs is called the actuarial accrued liability.

EXCHANGE‐LIKE TRANSACTION ‐ Transaction in which there is an identifiable exchange between the reporting government and another party, but the values exchanged may not be quite equal or the direct benefits of the exchange may not be exclusively for the parties to the exchange.

EXPENDITURES ‐ Decreases in net financial resources. Expenditures include current operating expenses requiring the present or future use of net current assets, debt service, and capital outlays, and intergovernmental grants, entitlement, and shared revenues.

EXPENDITURE‐DRIVEN GRANTS ‐ Government‐mandated or voluntary non‐exchange transactions in which expenditure is the prime factor for determining eligibility. Also referred to as reimbursement grants.

EXPENSES ‐ Outflows or other using up of assets or incurrence of liabilities (or a combination of both) from delivering or producing goods, rendering services, or carrying out other activities that constitute the entity’s ongoing major or central operations.

EXTERNAL AUDITORS ‐ Independent auditors typically engaged to conduct an audit of a government’s financial statements.

EXTERNAL INVESTMENT POOL ‐ An arrangement that commingles (pools) the moneys of more than one legally separate entity and invests, on the participants’ behalf, in an investment portfolio; one or more of the participants is not part of the sponsors reporting entity. An external investment pool can be sponsored by an individual government, jointly by more than one government, or by a nongovernmental entity. An investment pool that is sponsored by an individual state or local government is an external investment pool if it includes participation by a legally separate entity that is not part of the same reporting entity as the sponsoring government. If a government‐ sponsored pool includes only the primary government and its component units, it is an internal investment pool and not an external investment pool.

FAIR VALUE ‐ The amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

FIDUCIARY FUNDS ‐ The trust and agency funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units, and/or other funds.

FINANCIAL RESOURCES ‐ Resources that are or will become available for spending. Financial resources include cash and resources ordinarily expected to be converted to cash (e.g., receivables or investments). Financial resources may also include inventories and prepaids (because they obviate the need to expend current available resources).

FISCAL AGENT ‐ A fiduciary agent, usually a bank or county treasurer, who performs the function of paying debt principal and interest when due.

FUND ‐ A fiscal and accounting entity with a self‐balancing set of accounts in which cash and other financial resources, all related liabilities and residual equities, or balances, and changes therein, are recorded and segregated to carry on specific activities or attain certain objectives in accordance with special regulations, restrictions, or limitations.

FUND BALANCE ‐ The difference between fund assets and fund liabilities of governmental and similar trust funds.

FUND FINANCIAL STATEMENTS ‐ Basic financial statements presented on the basis of funds. Term used in contrast with government‐wide financial statements.

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FUND TYPE ‐ Any one of seven categories into which all funds are classified in governmental accounting. The seven fund types are: general, special revenue, debt service, capital projects, enterprise, internal service, and trust and agency.

GENERAL FUND ‐ The general fund is one of five governmental fund types and typically serves as the chief operating fund of the government. The general fund is used to account for all financial resources except those required to be accounted for in another fund.

GENERAL REVENUES ‐ All revenues that are not required to be reported as program revenues. All taxes, even those that are levied for a specific purpose, are general revenues and should be reported by type of tax (e.g., property tax, sales tax, and transient occupancy tax). All other nontax revenues (including interest, grants, and contributions) that do not meet the criteria to be reported as program revenues should also be reported as general revenues.

GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) ‐ The conventions, rules, and procedures that serve as the norm for the fair presentation of financial statements. The various sources of GAAP for state and local governments are set forth by Statement of Accounting Standards (SAS) No. 69, The Meaning of “Present Fairly in Conformity with Generally Accepted Accounting Principles” in the Independent Auditor’s Report.

GOVERNMENT FINANCE OFFICERS ASSOCIATION (GFOA) ‐ An association of public finance professionals founded in 1906 as the Municipal Finance Officers Association. The GFOA has played a major role in the development and promotion of GAAP for state and local governments since its inception and has sponsored the Certificate of Achievement for Excellence in Financial Reporting Program since 1946.

GOVERNMENTAL ACCOUNTING ‐ The composite activity of analyzing, recording, summarizing, reporting, and interpreting the financial transactions of governments.

GOVERNMENTAL ACCOUNTING STANDARDS BOARD (GASB) ‐ The ultimate authoritative accounting and financial reporting standard‐ setting body for state and local governments. The GASB was established in June 1984 to replace the National Council on Governmental Accounting (NCGA).

GOVERNMENTAL ACTIVITIES ‐ Activities generally financed through taxes, intergovernmental revenues, and other non‐exchange revenues. These activities are usually reported in governmental funds and internal service funds.

GOVERNMENTAL FUNDS ‐ Funds generally used to account for tax‐ supported activities. The five different types of governmental funds are as follows: the general fund, special revenue funds, debt service funds, capital projects funds, and permanent funds.

GOVERNMENTWIDE FINANCIAL STATEMENTS ‐ Financial statements that incorporate all of a government’s governmental and business‐type activities, as well as its non‐fiduciary component units. There are two basic government‐wide financial statements: the statement of net position and the statement of activities. Both basic governmental financial statements are presented using the economic resources measurement focus and the accrual basis of accounting.

IMPROVEMENT ‐ An addition made to, or change made in, a capital asset, other than maintenance, to prolong its life or to increase its efficiency or capacity. The cost of the addition or change is added to the book value of the asset.

INACTIVE EMPLOYEES ‐ Terminated individuals that have accumulated benefits but are not yet receiving them, and retirees or their beneficiaries currently receiving benefits.

INDIRECT EXPENSES ‐ Expenses that cannot be specifically associated with a given service, program, or department and thus, cannot be clearly associated with a particular functional category.

INFRASTRUCTURE ‐ Long‐lived capital assets that normally are stationary in nature and normally can be preserved for a significantly greater number of years than most capital assets. Examples of infrastructure assets include roads, bridges, tunnels, drainage systems, water and sewer systems, dams, and lighting systems.

NET INVESTMENT IN CAPITAL ASSETS ‐ One of three components of net position that must be reported in both government‐wide and proprietary fund financial statements. Related debt, for this purpose, includes the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or improvement of capital assets of the government.

INTERFUND RECEIVABLE/PAYABLE ‐ Short‐term loans made by one fund to another, or the current portion of an advance to or from another fund.

INTERFUND TRANSFERS ‐ Flow of assets (such as cash or goods) between funds and blended component units of the primary government without equivalent flows of assets in return and without a requirement for payment.

INTERNAL SERVICE FUND ‐ A fund used to account for the financing of goods or services provided by one department or agency to other departments or agencies of a government, or to other governments, on a cost‐reimbursement basis.

JOINT VENTURE ‐ A legal entity or other contractual arrangement in which a government participates as a separate and specific activity for the benefit of the public or service recipients and in which the government retains an ongoing financial interest.

LAPSE ‐ As applied to appropriations, the automatic termination of an appropriation. Except for indeterminate appropriations and continuing appropriations, an appropriation is made for a certain period of time. At the end of this period, any unexpended or unencumbered balance thereof lapses, unless otherwise provided by law.

LEASE‐PURCHASE AGREEMENTS ‐ Contractual agreements that are termed leases, but that in substance are purchase contracts.

LEGAL LEVEL OF BUDGETARY CONTROL ‐ The level at which spending in excess of budgeted amounts would be a violation of law.

LEVEL OF BUDGETARY CONTROL ‐ The level at which a government’s management may not reallocate resources without special approval from the legislative body.

LEVEL PERCENTAGE OF PROJECTED PAYROLL AMORTIZATION METHOD ‐ Amortization payments are calculated so that they are a constant percentage of the projected payroll of active plan members over a given number of years. The dollar amount of the payments generally will increase over time as payroll increases due to inflation; in dollars adjusted for inflation, the payments can be expected to remain level.

LIABILITIES ‐ Probable future sacrifices of economic benefits, arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.

LOANS RECEIVABLE ‐ An asset account reflecting amounts loaned to individuals or organizations external to a government, including notes taken as security for such loans. Loans to other funds and governments should be recorded and reported separately.

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MAJOR FUND ‐ A governmental fund or enterprise fund reported as a separate column in the basic fund financial statements. The general fund is always a major fund. Otherwise, major funds are funds whose revenues/expenditures, assets, or liabilities are at least 10 percent of corresponding totals for all governmental or enterprise funds and at least 5 percent of the aggregate amount for all governmental and enterprise funds for the same item. Any other governmental or enterprise fund may be reported as a major fund if the government’s officials believe that fund is particularly important to financial statement users.

MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A) ‐ A component of required supplementary information used to introduce the basic financial statements and to provide an analytical overview of the government’s financial activities.

MEASUREMENT FOCUS ‐ A way of presenting an entity’s financial performance and position by considering which resources are measured (financial or economic) and when the effects of transactions or events involving those resources are recognized (the basis of accounting). The measurement focus of government‐wide financial statements, proprietary fund financial statements, and fiduciary fund financial statements is economic resources. The measurement focus of governmental fund financial statements is current financial resources.

MEASUREMENT PERIOD ‐ The period between the prior and the current measurement dates.

MODIFIED ACCRUAL BASIS OF ACCOUNTING ‐ The accrual basis of accounting adapted to the governmental fund‐type measurement focus. Under it, revenues and other financial resource increments (e.g., bond issue proceeds) are recognized when they become susceptible to accrual, that is when they become both “measurable” and “available to finance expenditures of the current period.” “Available” means collectible in the current period or soon enough thereafter to be used to pay liabilities of the current period. Generally, expenditures are recognized when the fund liability is incurred. All governmental funds, expendable trust funds and agency funds are accounted for using the modified accrual basis of accounting.

NET OPEB OBLIGATION ‐ In the context of defined benefit pension and other postemployment benefit plans, the cumulative difference between annual pension cost and the employer’s contributions to the plan, including the pension/OPEB liability (asset) at transition, if any, and excluding (a) short‐term differences and (b) unpaid contributions that have been converted to pension‐related/OPEB‐related debt.

NET PENSION LIABILITY ‐ The liability of employers and nonemployer contributing entities to employees for benefits provided through a defined benefit pension plan.

NONSPENDABLE FUND BALANCE ‐ Amounts that cannot be spent because they are either (a) not spendable in form or (b) legally or contractually required to be maintained intact.
OTHER FINANCING SOURCES ‐ An increase in current financial resources that is reported separately from revenues to avoid distorting revenue trends. The use of the other financing sources category is limited to items so classified by GAAP.

OTHER FINANCING USES ‐ A decrease in current financial resources that is reported separately from expenditures to avoid distorting expenditure trends. The use of other financing uses category is limited to items so classified by GAAP.

OTHER POSTEMPLOYMENT BENEFITS (OPEB) ‐ Medical, dental, vision, and other health‐related benefits provided to terminated employees, retired employees, dependents, and beneficiaries.

OVERLAPPING DEBT ‐ The proportionate share that property within a government must bear of the debts of all local governments located wholly or in part within the geographic boundaries of the reporting government. Except for special assessment debt, the amount of debt of each unit applicable to the reporting unit is arrived at by (1)

determining what percentage of the total assessed value of the overlapping jurisdiction lies within the limits of the reporting unit, and (2) applying this percentage to the total debt of the overlapping jurisdiction. Special assessment debt is allocated on the basis of the ratio of assessment receivable in each jurisdiction, which will be used wholly or in part to pay off the debt, to total assessments receivable, which will be used wholly or in part for this purpose.

PAY‐AS‐YOU‐GO ‐ a method of financing a pension plan under which the contributions to the plan are generally made at about the same time and in about the same amount as benefit payments and expenses becoming due.

PAYROLL GROWTH RATE ‐ an actuarial assumption with respect to future increases in total covered payroll attributable to inflation; used in applying the level percentage of projected payroll amortization method.

PENSION BENEFITS ‐ Retirement income and all other benefits, including disability benefits, death benefits, life insurance, and other ancillary benefits, except healthcare benefits, that are provided through a defined benefit pension plan to plan members and beneficiaries after termination of employment or after retirement. Postemployment healthcare benefits are considered other postemployment benefits, whether they are provided through a defined benefit pension plan or another type of plan.

PENSION PLANS ‐ Arrangements through which pensions are determined, assets dedicated for pensions are accumulated and managed, and benefits are paid as they come due.

PLAN MEMBERS ‐ Individuals that are covered under the terms of a pension plan. Plan members generally include (a) employees in active service (active plan members) and (b) terminated employees who have accumulated benefits but are not yet receiving them and retirees or their beneficiaries currently receiving benefits (inactive plan members).

POSTEMPLOYMENT ‐ Period following termination of employment, including the time between termination and retirement postemployment healthcare benefits.

PROGRAM REVENUES ‐ Term used in connection with the government‐ wide statement of activities. Revenues that derive directly from the program itself or from parties outside the reporting government’s taxpayers or citizenry, as a whole; they reduce the net cost of the function to be financed from the government’s general revenues.

PROJECTED BENEFIT PAYMENTS ‐ All benefits estimated to be payable through the pension plan to current active and inactive employees as a result of their past service and their expected future service.

PROPRIETARY FUNDS ‐ Funds that focus on the determination of operating income, changes in net position (or cost recovery), financial position, and cash flows. There are two different types of proprietary funds: enterprise funds and internal service funds.

REAL RATE OF RETURN ‐ The rate of return on an investment after adjustment to eliminate inflation.

REBATABLE ARBITRAGE ‐ A term used in connection with the reinvestment of the proceeds of tax‐exempt debt. A requirement to remit to the federal government interest revenue in excess of interest costs when the proceeds from the sale of tax‐exempt securities are reinvested in a taxable money market instrument with a materially higher yield.

REPORTING ENTITY ‐ The oversight unit and all of its component units, if any, that are combined in the CAFR/BFS.

REQUIRED SUPPLEMENTARY INFORMATION ‐ Consists of statements, schedules, statistical data, or other information that according to the GASB is necessary to supplement, although not required to be a part of, the basic financial statements.

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RESTRICTED ASSETS ‐ Assets whose use is subject to constraints that are either (a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation.

RESTRICTED FUND BALANCE ‐ Amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation.

RESTRICTED NET POSITION ‐ A component of net position calculated by reducing the carrying value of restricted assets by the amount of any related debt outstanding.

RETAINED EARNINGS ‐ An equity account reflecting the accumulated earnings of an enterprise or internal service fund.

REVENUE BONDS ‐ Bonds whose principal and interest are payable exclusively from earnings of an enterprise fund. In addition to a pledge of revenues, such bonds sometimes contain a mortgage on the enterprise fund’s property.

RISK MANAGEMENT ‐ All the ways and means used to avoid accidental loss or to reduce its consequences if it does occur.

SELF‐INSURANCE ‐ A term often used to describe the retention by an entity of a risk of loss arising out of the ownership of property or from some other cause, instead of transferring that risk to an independent third party through the purchase of an insurance policy. It is sometimes accompanied by the setting aside of assets to fund any related losses. Because no insurance is involved, the term self‐ insurance is a misnomer.

SERVICE LIFE – The average remaining years of service of all members of the plan (both current employees and retirees

SINGLE AUDIT ‐ An audit performed in accordance with the Single Audit Act of 1997 and Office of Management and Budget’s (OMB) Circular A‐ 133, Audits of States and Local Governments and Non‐Profit Organizations. The Single Audit Act allows or requires governments (depending on the amount of federal assistance received) to have one audit performed to meet the needs of all federal agencies.

SPECIAL DISTRICT ‐ An independent unit of local government organized to perform a single government function or a restricted number of related functions. Special districts usually have the power to incur debt and levy taxes; however, certain types of special districts are entirely dependent upon enterprise earnings and cannot impose taxes. Examples of special districts are water districts, drainage districts, flood control districts, hospital districts, fire protection districts, cemetery districts, transit authorities, port authorities, and electric power authorities.

SPECIAL REVENUE FUND ‐ A fund used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditure for specified purposes.

SUBSTANTIVE PLAN ‐ Terms of an OPEB plan as understood by the employer(s) and plan members.

TAX AND REVENUE ANTICIPATION NOTES (TRAN) ‐ Notes issued in anticipation of the collection of taxes and revenues, usually retirable only from tax collections, and frequently only from the proceeds of the tax and revenue levy whose collection they anticipate.

TERMINATION BENEFITS‐ Inducements offered by employers to active employees to hasten the termination of services, or payments made in consequence of the early termination of services. Termination benefits include early‐retirement incentives, severance benefits, and other termination‐related benefits.

TOTAL PENSION LIABILITY ‐ The portion of the actuarial present value of projected benefit payments that is attributed to past periods of employee service.

TRUST FUNDS ‐ Funds used to account for assets held by a government in a trustee capacity for individuals, private organizations, other governments, and/or other funds.

UNASSIGNED FUND BALANCE – The residual classification for the County’s General Fund that includes amounts not contained in the other classifications. In other funds, the unassigned classification is used only if expenditures incurred for specific purposes exceed the amounts restricted, committed, or assigned to those purposes.

UNMODIFIED OPINION ‐ An opinion rendered without reservation by the independent auditor that financial statements are fairly presented.

UNRESTRICTED NET POSITION ‐ That portion of net position that is neither restricted nor invested in capital assets (net of related debt

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