HomeMy WebLinkAbout2009 FIFD FISHERS ISLAND FERRY DISTRICT
A COMPONENT UNIT OF
THE TOWN OF SOUTHOLD
FINANCIAL STATEMENTS
DECEMBER 31,2009
FISHERS ISLAND FERRY DISTRICT
A COMPONENT UNIT OF
THE TOWN OF SOUTHOLD
FINANCIAL STATEMENTS
DECEMBER 31,2009
INANCIAL SECTIO
IndependentAuditor's Report...........................................................................................................1
[REQUIRED SUPPLEMENTARY INFORMATIO
Management's Discussion and Analysis................................................................................................2-3
ASIC FINANCIAL STATEMENT
Statement of Net Assets........................................................................... .4
....................................
Statementof Activities..................................................................................................... .................................................5
Balance Sheet-Governmental Funds..................................................................................................6
Reconciliation of the Government Funds
Balance Sheet to the Statement of Net Assets.............................................................................7
Statement of Revenues,Expenditures,and Changes
In Fund Balances-Governmental Funds..................................................................................8
Reconciliation of the Government Funds
Statement of Revenues,Expenditures and Changes in Fund Balances
To the Statement of Activities..............................................................................................9
Statement of Fiduciary Net Assets-Fiduciary Funds.............................................................................10
Notes to the Financial Statements...................................................................................................1 I
REQUIRED SUPPLEMENTARY INFORMATION OTHER THAN MANAGEMENT DISCUSSION AND
ANALYSIS
Schedule of Revenues,Expenses,and Changes in Net Assets-Budget and Actual..........................................24
DOHERTY,BEALS&BANKS,P.C.
DOHERTY,BEALS &BANKS,P.C.
CERTIFIED PUBLIC ACCOUNTANTS
187 WILLIAMS STREET
POST OFFICE BOX 59
STACEY L.GUALTIERI,CPA NEW LONDON,CONNECTICUT 06320
KATHLEEN A.STEAMER,CPA (860)443-2033
DAVID J.MICELI,CPA FAX(860)444-7086
AUDREY A.LEONE,CPA WWW.DBBCFA.COM
Board of Commissioners
Fishers Island Ferry District
Fishers Island,NY 06390
INDEPENDENT AUDITOR'S REPORT
We have audited the accompanying financial statements of the Fishers Island Ferry District,(a component unit of The
Town of Southold) as of and for the year ended December 31,2009,which collectively comprise the District's basic
financial statements as listed in the table of contents. These financial statements are the responsibility of the Fishers
Island Ferry District's management.Our responsibility is to express an opinion 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.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and the significant estimates made by management,as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion,the financial statements referred to above present fairly, in all material respects, the financial position
of the Fishers Island Ferry District as of December 31,2009,and the results of its operations for the year then ended
in conformity with accounting principles generally accepted in the United States of America.
CDOtERTYA1 S dk BANKS,P.C.
June 24,2010
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FISHERS ISLAND FERRY DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2009
The following is a discussion and analysis of the Fishers Island Feng District's financial performance, providing an
overview of the Fishers Island Ferry District's financial activities for the year ended December 31, 2009. Use this
section in conjunction with the Fishers Island Ferry District's basic financial statements.
FINANCIAL ANALYSIS OF THE FISHERS ISLAND FERRY DISTRICT
Our analysis below focuses on the net assets and changes in net assets of the Fishers Island Ferry District's activities.
Condensed Statement of Net Assets
Primary Activities
December 31,2009 and 2008
Assets 2009 2008
Current and other assets $ 487,557 $ 563,419
Capital assets 14,863,899 15,606,173
Total assets 15,351,456 16,169,592
Liabilities
Current and other liabilities 1,358,968 1,749,142
Long-term liabilities 2,369,996 2,557,840
Total liabilities 3,728,964 4,306,982
Net Assets
Invested in capital assets 11,763,899 12,006,173
Unrestricted(deficit) (141,408) (143,563)
Total net assets $ 11,622,491 $ 11,862,610
Changes in Net Assets
Fishers Island Ferry District
For the years ended December 31,2009 and 2008
Program Revenues 2009 2008
Charges for services $2,267,212 $2,497,801
Capital grants 229,121 324,086
2,496,333 2,821,887
General Revenues
Property taxes 590,000 590,000
Interest earnings 1,093 9,545
Other 81,940 57,383
673,033 656,928
Total Revenues 3,169,366 3,478,815
Program Expenses
Operating expenses 3,407,999 3,857,801
Interest on debt 1,486 5,713
Total Expenses 3,409,485 3,863,514
Increase(decrease)in Net Assets ($240,119) ($384,699)
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2009
FINANCIAL ANALYSIS OF THE FISHERS ISLAND FERRY DISTRICT(continued)
The following schedule presents a summary of Fishers Island Ferry District revenues and expenses for the year ended
December 31,2009 and the amount of change and percentage of total in relation to the prior year.
Increase %
2009 2008 (Decrease) Change
Revenues
Charges for services $ 2,267,212 $ 2,497,801 $ (230,589) -10.17%
Capital grants 229,121 324,086 (94,965) -41.44%
Property taxes 590,000 590,000 - 0%
Interest earnings 1,093 9,545 (8,452) -773.28%
Other 81,940 57,383 24,557 29.96%
Total Revenues $ 3,169,366 $ 3,478,815 $ (309,449) -9.76%
Program Expenses
Operating expenses $ 3,407,999 $ 3,857,801 $ (449,802) -13.20%
Interest on debt 1,486 5,713 (4,227) -284.45%
Total Expenses $ 3,409,485 $ 3,863,514 $ (454,029) -13.32%
BUDGETARY HIGHLIGHTS
Over the course of the year,the Fishers Island Ferry District revises the budget as needed so that expenditures do not
exceed appropriations. Various transfers between appropriations were approved for this purpose.
CONTACTING THE DISTRICT
This financial report is designed to provide the reader with a general overview of the District's finances and to
demonstrate the District's accountability for the funds it receives. Requests for additional information can be directed
to:
Mr.Thomas Doherty
Manager
Fishers Island Ferry District
Fishers Island,NY 06390
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
STATEMENT OF NET ASSETS
AS OF DECEMBER 31,2009
ASSETS
Current assets:
Cash and investments $ 250,196
Other receivables 8,230
Due from grants 2,649
Due from primary government 207,573
Prepaid expenses 18,908
Total current assets 487,556
Noncurrent assets
Nondepreciable capital assets 41,717
Buildings 19,387,118
Machinery and equipment 2,871,691
Less:accumulated depreciation (7,436,627)
Total noncurrent assets 14,863,899
Total assets $15,351,455
LIABILITIES
Current liabilities
Accounts payable $ 103,662
Accrued interest payable 28,831
Bond anticipation notes 850,000
Non-current liabilities due within one year
General obligation bonds payable 175,000
Claims and judgments payable 47,664
Unearned revenue 178,811
Total current liabilities 1,383,968
Noncurrent liabilities
Wages payable 172,896
Postemployment benefits payable 97,100
General obligations bonds payable 2,075,000
Total noncurrent liabilities 2,344,996
Total liabilities 3,728,964
NET ASSETS
Investments in fixed assets,net of related debt 11,763,899
Unrestricted(deficit) (141,408)
Total net assets 11,622,491
Total Liabilities and net assets $ 15,351,455
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31,2009
Operating revenues:
Operations $ 2,214,662
Charters 19,966
Mail 23,350
Theater 9,234
Other revenues 81,940
Total operating revenues 2,349,152
Operating expenses:
Personnel 1,271,916
Employee benefits 325,336
Equipment maintenance 242,262
Contractual services 414,507
Depreciation 753,433
Airport 95,692
Theater 18,748
Mail 7,200
Insurance 68,343
Property tax 46,493
Repairs-docks 23,362
Bond payments 100,707
Administration 38,230
Insurance claims 3,256
Total operating expenses 3,409,485
Operating Income(loss) (1,060,333)
General revenues and expenses:
Interest income 1,093
Capital grants 229,121
Property taxes 590,000
Total nonoperating revenues 820,214
Change in net assets (240,119)
Net assets-beginning of the year 11,862,610
Net assets-end of the year $ 11,622,491
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
BALANCE SHEET- GOVERNMENTAL FUNDS
AS OF DECEMBER 31,2009
Total
Governmental
ASSETS General Special Aid Fund
Cash and investments $ 250,196 $ - $ 250,196
Accounts receivables 8,231 - 8,231
State and federal aid receivable 2,649 - 2,649
Due from other governments 207,573 - 207,573
Due from other funds 0 - 0
Prepaid expenses 18,908 - 18,908
Total assets $ 487,557 $ - $ 487,557
LIABILITIES
Current Liabilities
Accounts payable $ 103,662 $ - $ 103,662
Bond anticipation notes payable - 850,000 850,000
Deferred revenues 178,811 - 178,811
Total liabilities 282,473 850,000 1,132,473
FUND BALANCES
Reserve for
Bond anticipation notes - -
Unrestricted(deficit)-Undesignated 205,084 (850,000) (644,916)
Total fund balances 205,084 (850,000) (644,916)
Total liabilities and net assets $ 487,557 $ - $ 487,557
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
RECONCILIATION OF THE GOVERNMENT FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS
AS OF DECEMBER 31,2009
Total Governmental Fund Balances $ (644,916)
Amounts reported for governmental activities in the
Statement of Net Assets are different because:
The cost of building and acquiring capital assets(land,buildings,equipment)
financed from the governmental funds are reported as expenditures in the year
they are incurred,and the assets do not appear on the balance sheet. However,
the Statement of Net Assets includes those capital assets among the assets of the
District as a whole,and their original costs are expensed over their useful lives.
Original cost of capital assets 22,300,526
Accumulated depreciation (7,436,627)
14,863,899
Long-term liabilities,including bonds payable,are not due and payable in
the current period and therefore are not reported as liabilities in the funds.
Long-term liabilities at year end consist of.
Bonds payable (2,250,000)
Accrued interest payable (28,832)
Compensated absences (172,896)
Postemployment benefits payable (97,100)
Judgment and claims payable (47,664)
(2,596,492)
Total net assets $ 11,622,491
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
STATEMENT OF REVENUES,EXPENDITURES
AND CHANGES IN FUND BALANCES-GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31,2009
Total
Governmental
REVENUES General Special Aid Fund
Departmental income $ 2,203,782 $ - $ 2,203,782
Capital grants 79,236 149,885 229,121
Real property taxes 590,000 - 590,000
Real property tax items 120 -
120
Intergovernmental charges 59,592 - 59,592
Sale of property and compensation for loss - _ -
State aid 4,043 - 4,043
Federal aid 75,193 - 75,193
Miscellaneous local sources 167 - 167
Use of money and property 7,195 152 7,347
Total revenues 3,019,328 150,037 3,169,365
EXPENDITURES
General government support 190,460 - 190,460
Transportation 2,062,098 - 2,062,098
Culture and recreation 18,749 - 18,749
Employee benefits 319,657 - 319,657
Capital outlay 11,159 - 11,159
Debt Service
Principal 150,000 - 150,000
Interest 115,540 1,486 117,026
Total expenditures 2,867,663 1,486 2,869,149
Excess(Deficiency)of Revenues over Expenditures 151,665 148,551 300,216
Other Financing Sources(Uses)
Operating transfers in - 3,716 3,716
Operating transfers out (3,716) - (3,716)
Fund balances-beginning of the year 57,135 (1,002,267) (945,132)
Fund balances-end of the year $ 205,084 $ (850,000) $ (644,916)
See notes to financial.statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
RECONCILIATION OF THE GOVERNMENT FUNDS STATEMENT REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF
ACTIVITIES
AS OF DECEMBER 31,2009
Net Change in Fund Balances $ 300,216
Amounts reported for governmental activities in the
Statement of Activities are different because:
Long-term Revenue and Expense Differences
In the Statement of Activities,certain operating expenses are measured
by the amounts earned during the year. In the governmental funds,
however,expenditures for these items are measured by the amount of
financial resources used(essentially,the amounts paid)
Compensated absences $ (7,818)
Postemployment benefits (2,001)
Accrued interest 16,320
Judgment and claims 45,438
51,939
Capital Related Differences
Capital outlays to purchase or build capital assets are reported in governmental funds
as expenditures. However,for governmental activities those costs are capitalized and
shown in the statement of net assets and allocated over their useful lives as annual
depreciation expenses in the Statement of activities
Capital outlays 11,159
Depreciation expense (753,433)
(742,274)
Long-term Debt Transaction Differences
Repayment of bond principal is an expenditure in the governmental funds,but it reduces
the long-term liabilities in the Statement of Net Assets and does not affect the Statement
of Activities 150,000
Total change in net assets $ 240,119
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
COMPONENT UNIT OF TOWN OF SOUTHOLD
STATEMENT OF FIDUCIARY NET ASSETS-
FIDUCIARY FUNDS
AS OF DECEMBER 31,2009
ASSETS Agency
Cash $ 28,762
Total assets $ 28,762
LIABILITIES
Due to other funds $ 28,762
Total liabilities $ 28,762
See notes to f nancial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
l. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Fishers Island Ferry District(District)have been prepared in conformity with
accounting principles generally accepted in the United States of America (GAAP) for governmental units.
The Governmental Accounting Standards Board (GASB) is the standard-setting body for establishing
governmental accounting and financial reporting principles. Significant accounting principles and policies
used by the District are as follows:
A. Reporting Entity
The District is governed by the laws of New York State. The District is an independent entity
governed by an elected Board of Commissioners consisting of five members. The President of the
Board serves as the chief fiscal officer and the Superintendent is the chief executive officer, The
Board is responsible for, and controls all activities within the District. Board members have
authority to make decisions,power to appoint management,and primary accountability for all fiscal
matters.
The financial reporting entity is based on criteria set forth by GASB Statement No. 14, The
Financial Reporting Entity and No. 39, Determining Whether Certain Organizations are
Component Units. The financial reporting entity consists of the primary government,organizations
for which the primary government is financially accountable and other organizations for which the
nature and significance of their relationship with the primary government are such that exclusion
would cause the reporting entity's financial statements to be misleading or incomplete.
The accompanying financial statements present the activities of the District. The District is a
component unit of The Town of Southold,another reporting entity.
B. Basis of Presentation
Fund Financial Statements
The fund financial statements provide information about the District's funds, including fiduciary
funds. Separate statements for each fund category, governmental and fiduciary, are presented. The
emphasis of fund financial statements is on major governmental funds as defined by GASB, each
displayed in a separate column. The District's financial statements reflect the following fund
categories:
Governmental Funds:
General Fund — is the general operating fund and is used to account for all financial
transactions except those required to be accounted for in another fund.
Special Aid Fund—is used to account for the proceeds of specific revenue sources such as
federal and state grants that are legally restricted to expenditures for specified purposes.
These legal restrictions may be imposed by either governments that provide the funds or
outside parties.
Fiduciary Funds—are used to account for activities in which the District acts as trustee or
agent for resources that belong to others. These activities are not included in the district-
wide financial statements,because their resources do not belong to the District,and are not
available to be used.
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FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
C. Basis of Accounting and Measurement Focus
The statement of activities and the statement of net assets and fiduciary fund financial statements are
reported on the accrual basis of accounting using the economic resources measurement focus.
Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred,
regardless of when the related cash transaction takes place. On an accrual basis, revenue from real
property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from ferry
operations and grants are recognized in the fiscal year in which all eligibility requirements have
been satisfied and the related expenditures are incurred.
The fund statements are reported on the modified accrual basis of accounting using the current
financial resources measurement focus. Revenues are recognized when measurable and available.
The District considers all revenues reported in the governmental funds to be available if the
revenues are collected within 180 days after the end of the fiscal year,except for real property taxes,
which are considered to be available if they are collected within 60 days after the end of the fiscal
year.
Expenditures are recorded when the related fund liability is incurred, except for principal and
interest on general long-term debt, claims and judgments, and compensated absences, which are
recognized as expenditures to the extent they have matured. General capital asset acquisitions are
reported as expenditures in governmental funds,Proceeds of general long-term debt and acquisitions
under capital leases are reported as other financing sources.
D. Real Property Taxes
Calendar
Real property taxes are levied annually by the Town of Southold no later than October 1" and
become a lien on December 1". Taxes were collected by the Town of Southold and remitted to the
District from December to June.
Enforcement
Uncollected real property taxes are subsequently enforced by the County of Suffolk in June.
E. Restricted Resources
When an expense is incurred for purposes for which both restricted and unrestricted net assets are
available,the District's policy concerning which to apply first varies with the intended use,and with
associated legal requirements, many of which are described elsewhere in these Notes to Financial
Statements.
F. Interfund Transactions
The operations of the District include transactions between funds. These transactions may be
temporary in nature, such as with interfund borrowings. The District typically loans resources
between funds for the purpose of providing cash flow. These interfund receivables and payables are
expected to be repaid within one year. Permanent transfers of funds include transfers to provide
financing or other services. This includes the transfer of unrestricted general fund revenues to
finance various programs that the District must account for in other funds in accordance with
budgetary authorizations.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
F. Interfund Transactions (Continued)
The governmental funds report all interfund transactions as originally recorded. Interfund
receivables and payables are netted on the accompanying governmental funds balance sheet when it
is the District's practice to settle these amounts at a net balance based upon the right of legal offset.
G. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported revenues and expenses during the reporting period.
Accordingly, actual results could differ from those estimates. Estimates and assumptions are made
in a variety of areas, including computation of encumbrances, compensated absences, potential
contingent liabilities and useful lives of long-lived assets.
H. Cash and Cash Equivalents/Investments
Cash and cash equivalents consist of cash on hand and bank deposits with a maturity date of three
months or less from date of acquisition.
I. Receivables
Receivables include amounts due from Federal, State,and other governments or entities for services
provided by the Town. Receivables are recorded and revenues recognized as earned or as specific
program expenditures are incurred.
J. Prepaid Items
Prepaid items represent payments made by the District for which benefits extend beyond year-end.
These payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in the fund financial statements.A current asset for the prepaid amounts is recorded at
the time of purchase and an expense/expenditure is reported in the year the goods or services are
consumed.
K. Capital Assets
Capital assets purchased or acquired with an original cost of $5,000 or more are reported at
historical cost or estimated historical cost.Contributed assets are reported at fair market value as of
the date received. Additions, improvements, and other capital outlays that significantly extend the
useful life of an asset are capitalized.Other costs incurred for repairs and maintenance are expensed
as incurred. Depreciation on all assets is provided on the straight-line basis over the following
estimated useful lives:
Buildings 10-40 years
Improvements and other 20 years
Machinery and equipment 5-10 years
Infrastructure 20-30 years
Infrastructure assets,consisting of certain improvements other than buildings including roads,curbs,
sidewalks,bridges and street lighting are capitalized along with other capital assets.
In the fund financial statements, capital assets are recorded as capital outlay expenditures in the
governmental fund upon acquisition.
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FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
L. Deferred Revenue
Deferred revenue arises when potential revenues do not meet both the measurable and available
criteria for recognition in the current period. Deferred revenues also arise when resources are
received by the District before it has a legal claim to them,as when grant monies are received prior
to the incurrence of qualifying expenditures. In subsequent periods, when both recognition criteria
are met, or when the District has legal claim to the resources, the liability for deferred revenues is
removed and revenues are recognized.
M. Vested Employee Benefits—Compensated Absences
Compensated absences consist of unpaid accumulated sick leave and vacation time.
Sick leave eligibility and accumulation is specified in collective bargaining agreements and in
individual employment contracts. Upon retirement, resignation or death, employees may
contractually receive a payment based on unused accumulated sick leave.
Vacation eligibility and accumulation is specified in collective bargaining agreements and in
individual employment contracts. Some earned benefits may be forfeited if not taken within varying
time periods.
Consistent with GASB Statement No. 16,Accounting for Compensated Absences, the liability has
been calculated using the vesting method and an accrual for that liability is included in the district-
wide financial statements.The compensated absences liability is calculated based on the payrates in
effect at year-end.
N. Retirement System
Eligible District employees participate in the New York State Teachers' Retirement System or the
New York State Er4Ployees'Retirement System.
In addition to providing pension benefits, the District provides post employment health insurance
coverage and survivor benefits for retired employees and their survivors. Collective bargaining
agreements determine if District employees are eligible for these benefits if they reach normal
retirement age while working for the District.Health care benefits are provided through plans whose
premiums are based on the benefits paid during the year. The cost of providing post-retirement
benefits is shared between the District and the retired employee. The District recognizes the cost of
providing health insurance by recording its share of insurance premiums as an expenditure in the
general fund,in the year paid.
O. Short-Term Debt
The District may issue bond anticipation notes (BAN), in anticipation of proceeds from the
subsequent sale of bonds. These notes are recorded as current liabilities of the funds that will
actually receive the proceeds from the issuance of bonds. State law required that BANs issued for
capital purposes be converted to long-term financing within five years after the original issue date.
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DOHERTY,BEALS&BANKS,P.C.
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FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
P. Accrued Liabilities and Long-Term Obligations
In the governmental funds, payables and accrued liabilities are paid in a timely manner and in full
from current financial resources.Claims and judgments,and compensated absences that will be paid
from governmental funds, are reported as a liability in the fund financial statements only to the
extent that they are due for payment in the current year.Bonds and other long-term obligations that
will be paid from governmental funds are recognized as a liability in the fund financial statements
when due.
Long-term obligations represent the District's future obligations or future economic outflows. The
liabilities are reported as due in one year or due within more than one year in the Statement of Net
Assets.
Q. Equity Classifications
In the Government-wide Statements, equity is classified as net assets and displayed in three
components:
1. Invested in capital assets,net of related debt—Consists of capital assets including restricted
capital assets,net of accumulated depreciation and reduced by the outstanding balances of
any bonds,notes, or other borrowings that are attributable to the acquisition,construction,
or improvement of those assets.
2. Restricted net assets—Consists of net assets with constraints placed on the use either by(1)
external groups such as creditors, grantors, contributors, or laws or regulations of other
governments;or(2)law through constitutional provisions or enabling legislation.
3. Unrestricted net assets—All other net assets that do not meet the definition of"restricted"
or"invested in capital assets,net of related debt."
In the Fund Statements, governmental fund equity is classified as fund balance. Fund balance is
further classified as reserved and unreserved, with unreserved further split between designated and
undesignated. Portions of fund equity are segregated for future use and therefore not available for
future appropriation or expenditure. Amounts reserved for encumbrances, inventory, insurance
claims and debt service represent portions of fund equity, which are required to be segregated in
accordance with state law or GAAP. Designations of fund balances in governmental funds indicate
the utilization of these resources in the subsequent year's budget or tentative plans for future use.
2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
STATEMENTS AND THE DISTRICT-WIDE STATEMENTS
Due to the differences in the measurement focus and basis of accounting used in the governmental fund
statements and the district-wide statements, certain financial transactions are treated differently. The basis
financial statements contain a full reconciliation of these items. The differences result primarily from the
economic resource measurement focus of the Statement of Activities, compared with the current financial
resource measurement focus of the governmental funds.
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FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
2, EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
STATEMENTS AND THE DISTRICT-WIDE STATEMENTS (Continued)
A. Total Fund Balances of Governmental Funds vs.Net Assets of Governmental Activities
Total fund balances of the District's governmental funds differ from"net assets"of governmental
activities reported in the Statement of Net Assets. This difference primarily results from the
additional long-term economic focus of the Statement of Net Assets versus the solely current
financial resources focus of the governmental fund Balance Sheets.
B. Statement of Revenues,Expenditures and Changes in Fund Balance vs.Statement of Activities
Differences between the Statement of Revenues, Expenditures and Changes in Fund Balance and
the Statement of Activities fall into one of three broad categories.
Long-Term Revenue and Expense Differences
Long-term revenue differences arise because governmental funds report revenues only when they
are considered "available," whereas the Statement of Activities reports revenues when earned.
Differences in long-term expenses arise because governmental funds report on a modified accrual
basis,whereas the accrual basis of accounting is used on the Statement of Activities.
Capital Related Differences
Capital related differences include the difference between proceeds for the sale of capital assets
reported on fund statements and the gain or loss on the sale of assets as reported on the Statement of
Activities, and the difference between recording an expenditure for the purchase of capital items in
the fund statements and depreciation expense on those items as recorded in the Statement of
Activities.
Long-Term Debt Transaction Differences
Long-term debt transaction differences occur because the issuance of long-term debt provides
current financial resources to governmental funds, but is recorded as a liability in the Statement of
Net Assets. In addition, both interest and principal payments are recorded as expenditures in the
fund statements when due and payable, whereas interest expense is recorded in the Statement of
Activities as it accrues, and principal payments are recorded as a reduction of liabilities in the
Statement of Net Assets.
3. STEWARDSHIP.COMPLIANCE AND AC .OUNTABILITY
A. Budgets
The District administration prepares a proposed budget for approval by the Board of Commissions
for the general fund,the only fund with a legally adopted budget.
The voters of the District approved the proposed appropriation budget for the general fund.
Appropriations are adopted at the program line item level.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
A. Budgets (Continued)
Appropriations established by the adoption of the budget constitute a limitation on expenditures
(and encumbrances)that may be incurred. Appropriations lapse at the end of the fiscal year unless
expended or encumbered. Encumbrances will lapse if not expended in the subsequent year.
Appropriations authorized for the current year are increased by the planned use of specific reserves,
and budget amendments approved by the Board of Commissions as a result of selected new revenue
sources not included in the original budget (when permitted by law). These supplemental
appropriations may occur subject to legal restrictions, if the Board approved them because of a need
that exists which was not determined at the time the budget was adopted.
Budgets are adopted annually on a basis consistent with GAAP. Appropriations authorized for the
year are increased by the amount of encumbrances carred forward from the prior year.
Budgets are established and used for individual capital project funds expenditures as approved by a
special referendum of the District's voters. The maximum project amount authorized is based
primarily upon the cost of the project, plus any requirements for external borrowings, not annual
appropriations.These budgets do not lapse and are carried over to subsequent fiscal years until the
completion of the projects.
B. Encumbrances
Encumbrance accounting is used for budget control and monitoring purposes and is reported as a
part of the governmental funds. Under this method, purchase orders, contracts and other
commitments for the expenditure of monies are recorded to reserve applicable appropriations.
Outstanding encumbrances as of year-end are presented as reservations of fund balance and do not
represent expenditures or liabilities. These commitments will be honored in the subsequent period.
Related expenditures are recognized at that time, as the liability is incurred or the commitment is
paid.
4. DEPOSITS WITH FINANCIAL INSTITUTIONS AND INVESTMENTS
The District's investment policies are governed by state statutes and District policy. Resources must be
deposited in Federal Deposit Insurance Corporation (FDIC) insured commercial banks or trust companies
located within the state.Permissible investments include obligations of the U.S.Treasury and U.S.Agencies,
repurchase agreements and obligations of New York State or its localities. Collateral is required for demand
and time deposits and certificates of deposit not covered by FDIC insurance.Obligations that may be pledged
as collateral are obligations of the United States and its Agencies and obligations of New York State and its
municipalities.Investments are stated at fair value.
Custodial credit risk is the risk that in the event of a bank failure, the District's deposits may not be returned
to it. GASB directs that deposits be disclosed as exposed to custodial credit risk if they are not covered by
depository insurance and the deposits are either:
A. Uncollateralized,
B. Collateralized by securities held by the pledging financial institution,or
C. Collateralized by securities held by the pledging financial institution's trust department or agent but
not in the District's name.
None of the District's aggregate bank balances, not covered by depository insurance, were exposed to
custodial credit risk as described above at year-end.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
4. DEPOSITS WITH FINANCIAL INSTITUTIONS AND INVESTMENTS (Continued)
The District did not have any investments at year-end or during the year. Consequently,the District was not
exposed to any material interest rate risk or foreign currency risk.
5. CAPITAL ASSETS
Capital asset balances and activity for the year ended December 31,2009 were as follows:
Balance Balance
1/1/2009 Additions Reductions 12/31/09
Governmental activities
Capital assets not being depreciated
Land $ 41,717 $ - $ - $ 41,717
Total capital assets
not being depreciated 41,717 - - 41,717
Capital assets being depreciated
Buildings and improvements 19,485,811 - (11,159) 19,474,652
Furniture and equipment 2,761,839 109,853 - 2,871,692
Total capital assets
being depreciated 22,247,650 109,853 (11,159) 22,346,344
Less accumulated depreciation for:
Buildings and improvements 4,553,827 657,024 - 5,210,851
Furniture and equipment 2,129,367 96,409 - 2,225,776
Total accumulated depreciation 6,683,194 753,433 - 7,436,627
Total capital assets,
being depreciated,net 15,564,456 (643,580) (11,159) 14,909,717
Capital assets,net $ 15,606,173 $ (643,580) $ (11,159) $14,951,434
6. INDEBTEDNESS
A. Short-Term Debt
Bond anticipation Notes(BANS)—Bond anticipation notes(BANS)are used as a temporary means
of financing capital expenditures in the capital projects fund. State law requires that BANS issued
for capital purposes be converted to long-term obligations within five years after the original issue
date.The notes or renewal thereof may not extend more than two years beyond the original date of
issue unless a portion is redeemed within two years and within each 12 month period thereafter.
Liabilities for BANS are generally accounted for in the capital projects fund. BANS are expected to
be paid from the proceeds of future bond issues after renewal of these notes. These BANs bear
interest at various rates from 2.20%to 2.75%.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
A. Short-Term Debt (Continued)
When BANs are not redeemed with the proceeds of bond issues,but instead paid from budgetary
appropriations,the principal amount paid is recorded as an expenditure in the operating fund and a
financing source is recorded in the capital projects fund.
These notes are summarized as follows:
Description Interest
Amount Rate
New London Wharf $ 850,000 2.20%
A summary of changes in BANs for the year ended December 31,2008 is as follows:
Balance Balance
1/1/2009 Increases Reductions 12/31/09
New London Wharf $ 1,200,000 $ - $ 350,000 $ 850,000
B. Long-Term Debt
Summary of changes in long-term debt transactions for the year ended December 31,2009 is as
follows:
Non-
current
liabilities
Balance Balance due within Non-current
1/1/2009 Increases Reductions 12/31/09 one year liabilities
General obligation
bonds $2,400,000 S $ 150,000 $2,250,000 $ 175,000 52,075,000
General Obligation Bonds—The District borrows money in order to acquire land,equipment or
construct buildings and improvements.This enables the cost of these capital assets to be borne by
the present and future taxpayers receiving the benefit of the capital assets.This long-term liability
which is backed by the full faith and credit of the District,bears interest at 3.78%and matures in
2021.
Future principal and interest payments are as follows:
Year Ending Principal Interest
2010 $ 175,000 $ 85,075
2011 175,000 78,513
2012 175,000 71,950
2013 175,000 65,387
2014 175,000 58,825
2015 175,000 52,263
2016 200,000 45,700
2017 200,000 38,200
2018-2021 800,000 77,500
Totals $ 2,250,000 $ 573,413
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DOHERTY,BEALS&BANKS,P.C.
' t
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
C. Long-Term Debt (Continued)
Interest on long-term debt for the year was comprised of:
Total interest expense on long-term debt $ 115,540
Other long-term liabilities for claims and judgments,compensated absences,retirement system and
the estimated liability for landfill closure and post closure costs are to be paid by the fund that gave
rise to the liability.
7. OTHER POST-EMPLOYMENT BENEFITS(OBLIGATIONS FOR HEALTH INSURANCE)
In the component unit financial statements, the cost of post employment healthcare benefits, like the cost of
pension benefits, generally should be associated with the period in which the cost occurs,rather than in the
future year when it will be paid.In adopting the requirements of GASB 45,during the year ended December
31, 2008, the District recognizes the cost of post employment healthcare in the year when the employee
services are received, reports the accumulated liability from prior years and provide information useful in
assessing potential demands on the District's future cash flows.Recognition of the liability accumulated from
prior years will be phased in over 30 years,commencing with the 2009 liability.
A. Plan Description
The District,as a single-employer defined benefit OPEB plan,per its contracts with employees,will
pay full premium costs for medical(currently provided by Empire Core Plan plus Enhancements or
HIP) insurance coverage at retirement. For participants, the District provides continuation of
medical insurance to employees who are 55 years old and have 30 years of service under the NYS
Retirement System or who are 62 years old and have 10 years of service with the District. The
retiree is eligible for full Medicare reimbursement in the amount of$1,209 per year. Healthcare
benefits for non-union employees are similar to those of union employees. Surviving spouses of
deceased employees may continue coverage by paying the premium equivalent for participants.
They are also entitled to Medicare part B premium reimbursement.
The number of participants as of January 1, 2009, the effective date of the OPEB valuation is as
follows.There have been no significant changes in the number or type of coverage since that date.
Active employees 17
Retirees 3
Spouses of retired employees 0
Total 20
B. Funding Policy
The District currently pays for post employment health care benefits on a pay-as-you-go basis.
C. Annual Other Post-Employment Benefits Cost and Net Obligation
For the year ended December 31, 2009, the District's annual other post-employment benefits cost
(expenses)were$114,335.Considering the annual expense as well as the payment of current health
insurance premiums, which totaled $17,235 for retirees and their beneficiaries, the result was an
increase in the other post-employment benefits liability of$97,100 for the year ended December 31,
2009.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
C. Annual Other Post-Employment Benefits Cost and Net Obligation (Continued)
Benefit
Obligations
and Normal
Cost
Retirees $ 286,305
Active employees 860,040
Unfunded actuarial accrued
liability(UAAL) $ 1,146,345
The District's annual other post-employment benefit cost is calculated based on the annual required
contribution (ARC) of the employer, an amount actuarially determined in accordance with the
parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an
ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial
liabilities(or funding excess)over a period not to exceed thirty years.
The District's annual other post-employment benefits cost,the amount actually paid and changes to
the District's net other post-employment benefits obligation to the Plan for the year ended
December 31,2009 are as follows:
Normal Cost $ 43,561
Amortization of unfunded actuarial
liability(UAAL)over 30 years 67,345
Interest 4,991
Annual required contribution(ARC) 115,897
Interest on net other
post-employment benefits obligation 4,289
Adjustment to ARC 5,851)
Annual OPEB cost(expense) 114,335
Less:contribution for year ended
December 31,2008 17,235
Increase in net OPEB obligation 97,100
Net OPEB obligation—beginning of year -
Net OPEB obligation—end of year $ 97,100
Percent of annual OPEB cost contributed
30.56%
D. Funded Status and Funding Progress
Annual Percentage Net OPEB
OPEB Cost Contributed Obligation
$ 114,335 14.59% $ 97,100
Actuarial Actuarial Accrued Actuarial UAAL as
Percentage Value of Liability Unfunded a Funded Covered
Valuation Date Assets (AAL) (URAL) Ratio Payroll Of Payroll
I/l/09 $ 0 $1,146,345 $1,1460,345 0% $ 974,567 117.63%
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DOHERTY,BEALS&BANKS,P.C.
4
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
E. Actuarial Methods and Assumptions
The projection of future benefits for an ongoing plan involves estimates of the value of reported
amounts and assumptions about the probability of occurrence of future events far into the future.
Amounts determined regarding the funded status of a plan and the employer's annual required
contributions are subject to continual revision as actual results are compared with past expectations
and new estimates are made about the future.
Projections of benefits for financial reporting purposes are based on the substantive plan(the plan as
understood by the employer and the plan members)and include the types of benefits provided at the
time of each valuation and the historical pattern of sharing benefit costs between the employer and
plan members to that point.The actuarial methods and assumptions used include techniques that are
designed to reduce the effects of short-term liability in actuarial accrued liabilities, consistent with
the long-term perspective of the calculations.
In the January 1, 2008 actuarial valuation, the liabilities were computed using the projected unit
credit cost method.The actuarial assumptions utilized a 4.5%discount rate.The valuation assumes a
10-12%healthcare cost trend increase for the year,reduced by decrements down to 5%in fiscal year
2015.The remaining amortization period at December 31,2009 was twenty nine years.
8. Pension Plans
A. Plan Description
The Fishers Island Ferry District, a component unit of the Town of Southold, participates in the
New York Employee's Retirement System, the New York State Policemen's and Firemen's
Retirement System and the Public Employee's Group Life Insurance Plan (Systems). These are
cost-sharing multiple-employer retirement systems. The Systems provide retirement benefit as well
as death and disability benefits. The New York State Retirement and Social Security Law
(NYSRSSL)govern obligations of employers to contribute and benefits to employees. As set forth
in the NYSRSSL, the Comptroller of the State of New York serves as sole trustee and
administrative head of the Systems. The Comptroller shall adopt and may amend rules and
regulations for the administration and transactions of the business of the Systems and for the
custody and control of their funds. The Systems issue a publicly available financial report that
includes financial statements and required supplementary information. That report may be obtained
by writing the New York State and Local Retirement System, Gov. Alfred E. Smith State Office
Building,Albany,NY 12244.
B. Funding Policy
The Systems are noncontributory except for employees who joined the New York State and Local
Employees' Retirement System after July 27, 1976, who contribute 3% of their salary. Under the
authority of the NYSRSSL,the Comptroller shall certify annually the rates expressed as proportions
of payroll of members which shall be used in computing the contributions required to be made by
employers to the pension accumulation fund.
The Town of Southold is required to contribute at an actuarially determined rate.
The Town's contributions made to the Systems were equal to 100%of the contributions required for
each year.The districts portion of the contribution was$79,210 in 2009.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2009
B. Funding Policy (Continued)
Since 1989,the Systems'billings have been based on Chapter 62 of the Laws of 1989 of the State of
New York. This legislation requires participating employers to make payments on a current basis,
while amortizing existing unpaid amounts relating to the Systems' fiscal years ending March 31,
1988,and 1989,(which otherwise were to have been paid on June 30, 1989,and 1990,respectively)
over a 17-year period, with an 8.75% interest factor added. Local governments were given the
option to prepay this liability.The Town elected to make the full payment on December 15, 1993,
by issuing serial bonds to replace this debt.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND FERRY DISTRICT
SCHEDULE OF REVENUES,EXPENSES,AND CHANGES
IN NET ASSETS-BUDGET AND ACTUAL
Variance with
Original Final Budget
Budget Final Budget 2009 Positive/(Ne ative
Revenues
Charges for services $2,705,000 $ 2,214,662 $ 2,267,212 $ 52,550
Capital grants 43,875 79,236 229,121 149,885
Property taxes 590,000 590,000 590,000 0
Interest earnings 13,000 1,228 1,093 (135)
Other 104,000 134,202 81,940 (52,262)
Total Revenues $3,455,875 $ 3,019,328 $ 3,169,366 $ 150,038
Program Expenses
Operating expenses 3,459,875 2,871,379 2,869,149 2,230
Total Expenses $ 3,459,875 $ 2,871,379 $ 2,869,149 $ 2,230
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DOHERTY,BEALS&BANKS,P.C.