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Home My WebLink About2016 Annual Comprehensive Financial Report City of Evanston, Illinois _________________________________________________________________ Comprehensive Annual Financial Report For the Year Ended December 31, 2016 CITY OF EVANSTON, ILLINOIS COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended December 31, 2016 Prepared by Administrative Services Department CITY OF EVANSTON, ILLINOIS TABLE OF CONTENTS Page(s) INTRODUCTORY SECTION Principal Officials ......................................................................................................... i Organization Chart ........................................................................................................ ii Certificate of Achievement for Excellence in Financial Reporting .............................. iii Letter of Transmittal ..................................................................................................... iv-xi FINANCIAL SECTION INDEPENDENT AUDITOR’S REPORT .................................................................... 1-3 GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS Management’s Discussion and Analysis .................................................................. MD&A 1-8 Basic Financial Statements Government-Wide Financial Statements Statement of Net Position ............................................................................... 4-5 Statement of Activities ................................................................................... 6-7 Fund Financial Statements Governmental Funds Balance Sheet ............................................................................................. 8-9 Reconciliation of Fund Balances of Governmental Funds to the Governmental Activities in the Statement of Net Position ................ 10 Statement of Revenues, Expenditures, and Changes in Fund Balances ....................................................................... 11 Reconciliation of Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Governmental Activities in the Statement of Activities .................................................. 12 CITY OF EVANSTON, ILLINOIS TABLE OF CONTENTS (Continued) Page(s) FINANCIAL SECTION (Continued) GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS (Continued) Basic Financial Statements (Continued) Fund Financial Statements (Continued) Proprietary Funds Statement of Net Position .......................................................................... 13-14 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position ................................................................. 15 Statement of Cash Flows ........................................................................... 16-17 Fiduciary Funds Statement of Fiduciary Net Position .......................................................... 18 Statement of Changes in Plan Net Position ............................................... 19 Notes to Financial Statements ............................................................................. 20-79 Required Supplementary Information Schedule of Funding Progress and Employer Contributions Other Postemployment Benefits ..................................................................... 80 Schedule of Employer Contributions Illinois Municipal Retirement Fund ............................................................... 81 Police Pension Fund ....................................................................................... 82 Firefighters' Pension Fund .............................................................................. 83 Schedule of Changes in the Employer’s Net Pension Liability and Related Ratios Illinois Municipal Retirement Fund ................................................................ 84 Police Pension Fund ....................................................................................... 85 Firefighters’ Pension Fund ............................................................................. 86 Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund .................................................................... 87 CITY OF EVANSTON, ILLINOIS TABLE OF CONTENTS (Continued) Page(s) FINANCIAL SECTION (Continued) GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS (Continued) Required Supplementary Information (Continued) Schedule of Investment Returns Police Pension Fund ....................................................................................... 88 Firefighters’ Pension Fund ............................................................................. 89 Notes to Required Supplementary Information ................................................... 90 COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES MAJOR GOVERNMENTAL FUNDS Schedule of Revenues - Budget and Actual - General Fund ............................... 91-94 Schedule of Expenditures - Budget and Actual - General Fund.......................... 95 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Obligation Debt Fund ....................................................................... 96 NONMAJOR GOVERNMENTAL FUNDS Combining Balance Sheet ................................................................................... 97-100 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances .......................................................................... 101-104 Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Motor Fuel Tax Fund ...................................................................................... 105 Economic Development Fund ........................................................................ 106 Emergency Telephone System Fund .............................................................. 107 Neighborhood Improvement Fund ................................................................. 108 Affordable Housing Fund ............................................................................... 109 HOME Fund ................................................................................................... 110 Community Development Block Grant Fund ................................................. 111 Schedule of Expenditures - Budget and Actual (Budgetary Basis) Community Development Block Grant Fund ................................................. 112 Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Community Development Loan Fund ............................................................ 113 Neighborhood Stabilization Program 2 Fund ................................................. 114 Special Service District No. 4 Fund ............................................................... 115 CITY OF EVANSTON, ILLINOIS TABLE OF CONTENTS (Continued) Page(s) FINANCIAL SECTION (Continued) COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES (Continued) NONMAJOR GOVERNMENTAL FUNDS (Continued) Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Good Neighbor Fund ...................................................................................... 116 General Assistance Fund ................................................................................ 117 Capital Improvements Fund ........................................................................... 118 Special Assessment Capital Projects Fund ..................................................... 119 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Debt Service Funds............. 120-121 ENTERPRISE FUNDS Water Fund Schedule of Revenues, Expenses, and Changes in Net Position - Budget and Actual ........................................................................................ 122 Water Fund - Operation and Maintenance Account Schedule of Operating Revenues - Budget and Actual................................... 123 INTERNAL SERVICE FUNDS Combining Statement of Net Position ................................................................. 124 Combining Statement of Revenues, Expenses, and Changes in Net Position .................................................................................... 125 Combining Statement of Cash Flows .................................................................. 126 COMPONENT UNIT - PUBLIC LIBRARY All Governmental Funds Combining Balance Sheet/Statement of Net Position .................................... 127 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances/Statement of Activities ...................................... 128 Major Governmental Funds Library Operating Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual .......................................................... 129 CITY OF EVANSTON, ILLINOIS TABLE OF CONTENTS (Continued) Page(s) STATISTICAL SECTION Net Position by Component .......................................................................................... 130 Changes in Net Position ................................................................................................ 131-132 Fund Balances, Governmental Funds ........................................................................... 133 Changes in Fund Balances, Governmental Funds......................................................... 134-135 Equalized Assessed Value and Actual Value of Taxable Property ............................... 136 Principal Property Taxpayers ........................................................................................ 137 Property Tax Levies and Collections ............................................................................ 138 Ratios of General Bonded Debt Outstanding ................................................................ 139 Ratios of Outstanding Debt by Type ............................................................................. 140 Direct and Overlapping Governmental Activities Debt ................................................ 141 Legal Debt Margin ........................................................................................................ 142 Pledged-Revenue Coverage .......................................................................................... 143 Demographic and Economic Statistics ......................................................................... 144 Principal Employers ...................................................................................................... 145 Full-Time Equivalent City Government Employees by Function................................. 146 Property Tax Rates per $100 - Direct and Overlapping Governments ......................... 147 Water Sold by Type of Customer (in 100 cubic feet) ................................................... 148 Water Sold by Major Customers ................................................................................... 149 Operating Indicators by Function/Program ................................................................... 150 Capital Assets Statistics by Function ............................................................................ 151 COMPLIANCE SECTION INDEPENDENT ACCOUNTANT’S REPORT ON COMPLIANCE WITH STATE OF ILLINOIS PUBLIC ACT 85-1142 ............................................... 152 INTRODUCTORY SECTION - i - CITY OF EVANSTON, ILLINOIS Principal Officials December 31, 2016 LEGISLATIVE Elizabeth B. Tisdahl, Mayor Judy Fiske Alderman – 1st Ward Peter Braithwaite Alderman – 2nd Ward Melissa A. Wynne Alderman – 3rd Ward Donald N. Wilson Alderman – 4th Ward Delores A. Holmes Alderman – 5th Ward Mark Tendam Alderman – 6th Ward Eleanor Revelle Alderman – 7th Ward Ann Rainey Alderman – 8th Ward Brian Miller Alderman – 9th Ward Rodney Greene, City Clerk EXECUTIVE Wally Bobkiewicz, City Manager Martin Lyons, City Treasurer/Assistant City Manager ADMINISTRATIVE Budget and Finance Manager Health and Human Services Ashley King Director Evonda Thomas-Smith Police and Fire Chief City Attorney Richard Eddington Grant Farrar Administrative Services Director Library Director Erika Storlie Karen Danczak Lyons Community Development Parks, Recreation, & Community Director Services Director Mark Muenzer Lawrence Hemingway Public Works Agency Director Dave Stoneback City of Evanston Organizational Chart - ii - Residents Mayor City Council City Clerk Police FireCommunity Development Public Works Agency Human Manager Assistant City Manager / CFO Boards and Commissions Library - iii - - iv - - v - - vi - - vii - - viii - - ix - - x - - xi - FINANCIAL SECTION - 1 - INDEPENDENT AUDITOR’S REPORT The Honorable Elizabeth B. Tisdahl, Mayor and Members of the City Council City of Evanston, Illinois We have audited the accompanying financial statements of the governmental activities, the business-type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the City of Evanston, Illinois (the City), as of and for the year ended December 31, 2016, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation , and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free fro m material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit . We conducted our audit in accordance with auditing standards generally accepted i n 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 involves performing procedures to obtain audit evi dence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimat es 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. - 1 - - 2 - 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, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the City of Evanston, Illinois, as of December 31, 2016, and the respective changes in financial position, and, where applicable, cash flows thereof for the year ended in conformity with accounting principles generally accepted i n the United States of America. Change in Accounting Principle The City adopted GASB Statement No. 72, Fair Value Measurement and Application, which addresses accounting and financial reporting issues related to fair value measurements . Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and the other required supplementar y information be presented to supplement the basic financial statements . Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic , or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements . We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements as a whole. The introductory section, combining and individual 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 combining and individual 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. The 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 - 2 - - 3 - information is 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. Naperville, Illinois July 20, 2017 - 3 - GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS (Unaudited) MD&A 1 MANAGEMENT’S DISCUSSION AND ANALYSIS DECEMBER 31, 2016 The City of Evanston (the City) Discussion and Analysis is designed to (1) assist the reader in focusing on significant financial issues, (2) provide an overview of the City's financial activity, (3) identify changes in the City's financial position (its ability to address the next and subsequent year challenges), (4) identify any material deviations from the financial plan (the approved budget), and (5) identify individual fund issues or concerns. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on page 4 of this report. FINANCIAL HIGHLIGHTS The City changed the treatment of property taxes and included the net pension liabilities associated with Illinois Municipal Retirement, Police and Fire Pension Funds per Government Accounting Standards Board (GASB) Statements 67/68 beginning in 2015 fiscal year, which reduced property taxes receivables and increased liabilities and resulted in a restatement of net position. A. The City's net position as originally stated in the 2015 Comprehensive Annual Financial Report (CAFR) was $206,762,149 for Governmental and Business Type Activities. The restated net position for 2015 is $173,801,411. The 2016 net position increased by $13,818,666 or 8%. a. The change in accounting principle amount for Governmental Activities was a decrease of $34,398,328. b. The change in accounting principle amount for Business-type Activities was an increase of $1,437,590. B. The governmental activities revenue increased by $9,590,200 or 7.6% from the prior period principally due to increase in Building Permits. The expenses increased by $8,057,474 or 6.6% principally due to restatement of prior period affecting pension expense and increase in construction projects. C. The business-type activities revenue increased by $1,272,386 or 3.3%. The expenses increased by $1,264,435 or 3.4% from the prior period. D. The total cost of all City programs increased by $9,321,967 or 6.1%. This increase was attributable to the effects of the implementation of GASB 67/68 and increase in capital projects. USING THIS ANNUAL REPORT The financial statements focus on both the City as a whole (government-wide) and on the major individual funds. Both perspectives (government-wide and major fund) allow the user to address relevant questions, broaden a basis for comparison and enhance the City's accountability. The City's financial reporting includes the funds of the City (primary government) and additionally, organizations for which the City is accountable (component unit - the Library). Effective May 1, 2014 the City of Evanston assumed all rights, powers, assets, properties and duties of the Evanston Township, including the responsibility of providing the services that were previously provided by the Township. The functions of the Township are reported along with the City, while the Library financials are shown as a discrete component unit beginning in 2013. (Unaudited) MD&A 2 REPORTING THE CITY AS A WHOLE Government-wide Financial Statements The City's annual report includes two government -wide financial statements. These statements provide both short-term and long-term information about the City's overall status. Financial reporting at this level uses a perspective similar to that found in the private sector with its basis in full accrual accounting and elimination or reclassification of internal activities (e.g., the City’s Fleet Maintenance Fund). The first of these government-wide statements is the Statement of Net Position. This is the City-wide statement of financial position presenting information that includes all the City's assets and liabilities, with the difference reported as net position. Beginning in 2013, this statement also includes separate presentation of Library assets and liabilities. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City as a whole is improving or deteriorating. Evaluation of the overall health of the City would extend to other non-financial factors such as diversification of the taxpayer base or the condition of City infrastructure in addition to the financial information provided in this report. The second government-wide statement is the Statement of Activities - which reports how the City's net position changed during the current fiscal period. All current period revenues and expenses for the city and Library are included regardless of when the cash was received or paid. An important purpose of the design of the statement of activities is to show the financial reliance of the City's distinct activities or functions on revenues provided by all government-wide sources. Both government-wide financial statements distinguish governmental activities of the City that are principally supported by taxes and intergovernmental revenues, such as grants, from business -type activities that are intended to recover all or a significant portion of their costs through user fees and charges. Governmental activities include general government, public safety, public service, fleet service, insurance fund, and culture and recreation. Business-type activities include water and sewer utilities, parking, and garages. Fiduciary activities, such as employee pension plans and agency funds, are not included in the government-wide statements since these assets are not available to fund City programs. The government-wide financial statements are presented on pages 4 - 7 of this report. REPORTING THE CITY'S MOST SIGNIFICANT FUNDS Fund Financial Statements A fund is an accountability unit used to maintain control over resources segregated for specific activities or objectives. The City uses funds to ensure and demonstrate compliance with finance-related laws and regulations. Within the basic financial statements, fund financial statements focus on the City's most significant funds, rather than the City as a whole. Major funds are separately reported, while all others are combined into a single aggregated presentation. Individual fund data for non-major funds is provided in the form of combining schedules in a later section of this report. (Unaudited) MD&A 3 The City has three kinds of funds: Governmental funds are reported in the fund financial statements and encompass essentially the same functions reported as governmental activities in the government -wide financial statements. However, the focus is very different with fund statements providing a distinctive view of the City's governmental funds. These statements report short-term fiscal accountability focusing on the use of spendable resources and balances of spendable resources available at the end of the period. They are useful in evaluating annual financing requirements of governmental programs and the commitment of spendable resources for the near-term. Since the government-wide focus includes the long-term view, comparisons between these two perspectives may provide insight into the long-term impact of the short-term financing decision. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to assist in understanding the differences between these two perspectives. Budgetary comparison statements for General Fund are included in the required supplementary section of this report. Budgetary comparison schedules for various special revenue funds and the debt service funds are also included in the supplementary information section of this report. These statements and schedules demonstrate compliance with the City's adopted and final revised budget. The basic government fund financial statements are presented on pages 8 – 12 of this report. Proprietary funds reported in the fund financial statements generally report services for which the City charges customers a fee. There are two kinds of proprietary funds. These are enterprise funds and internal service funds. Enterprise funds essentially encompass the same functions reported as business- type activities in the government-wide statements. Services such as the water utilities and the parking garages are provided to customers external to the City organization. Internal service funds provide services and charge fees to customers within the City organization, such as equipment services (repair and maintenance of city vehicles) and the insurance fund. Because the City's internal service funds primarily serve governmental functions, they are included within the governmental activities of the government- wide financial statements. Proprietary fund statements and statements for discretely presented component units (reporting is similar to proprietary funds) provide both short-term and long-term financial information consistent with the focus provided by the government-wide financial statements. Individual fund information for internal service funds is found in combining schedules in a later section of this report. The basic proprietary fund financial statements are presented on pages 13 - 17 of this report. Fiduciary funds such as the Police and Firefighter's pension plans are reported in the fiduciary fund financial statements, but are excluded from the government-wide reporting. Fiduciary fund financial statements report resources that are not available to fund City programs. These financial statements report similarly to proprietary funds. The basic fiduciary fund financial statements are presented on pages 18 - 19 of this report. Notes to the financial statements The accompanying notes to financial statements provide information essential to a full understanding of the government-wide and fund financial statements. The notes to the financial statements begin on page 20 of this report. (Unaudited) MD&A 4 Other Information In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City's progress in funding its obligations to provide pension benefits to its employees. Other supplementary information includes detail by fund and component unit for receivables, payables, transfers, and payments within the reporting entity. Required supplementary information can be found on pages 80 – 90 of this report. Major funds and component units are reported in the basic financial statements, as discussed. Combining statements, individual statements and schedules for nonmajor and internal service funds are presented in a subsequent section of this report beginning on page 91. Additional information on capital assets and long-term debt can be found on page 37 and 47, respectively. Financial Analysis of the City as a Whole The City's combined net position increased by $13,818,666 from $173,801,411, as restated, to $187,620,077. STATEMENT OF POSITION The City’s increase in Net Position after consideration of the increased Pension liability principally comes from a decrease in Loan and Bonded Debt from $222,070,541 to $217,364,154. The increase in Police and Fire Pension liability was the result of an increase in these Pension assets of $11.4 million or 7.0% compared to an increase in liabilities of $13.6 million. The City's total revenues increased by $10,862,699 or 6.6%. The City's total expenses for all programs increased by $9,321,967 or 6.1%. Business-type activity revenues increased by $1,272,386 in the current fiscal period mainly due to seasonal revenues from Water and Sewer Funds and increased revenues in the Solid Waste fund. Business-type activity expenses increased by $1,264,435, while Governmental activity expense experienced an increase of $8,057,532. The list of expenses can be found in the table below. The governmental activities experienced an increase of $5,883,889 in the net position balance. This is due to net revenue of $5,450,405 and a net transfer in of $433,484 from business activities to the government fund. Governmental Activities Business-type Activities Total Primary Government 2016 2015 2016 2015 2016 2015 (as restated)(as restated)(as restated) Current and Other Assets 103,939,418$ 97,534,216$ 24,450,701$ 26,300,743$ 128,390,119$ 123,834,959$ Capital Assets 167,678,799 166,110,310 344,972,099 339,354,708 512,650,898 505,465,018 Total Assets 271,618,217 263,644,526 369,422,800 365,655,451 641,041,017 629,299,977 Deferred Outflows 39,709,489 30,868,712 3,882,555 3,224,853 43,592,044 34,093,565 311,327,706 294,513,238 373,305,355 368,880,304 684,633,061 663,393,542 Long-Term Liabilities 359,259,565 317,577,205 80,634,320 88,226,770 439,893,885 405,803,975 Other Liabilities 10,206,291 7,167,732 4,891,775 2,246,641 15,098,066 9,414,373 Total Liabilities 369,465,856 324,744,937 85,526,095 90,473,411 454,991,951 415,218,348 Deferred Inflows 42,021,032 41,413,045 - - 42,021,032 41,413,045 Net Investment in Capital Assets 51,587,637 47,952,870 268,851,203 255,621,565 320,438,840 303,574,435 Restricted 18,523,340 16,408,973 - - 18,523,340 16,408,973 Unrestricted (Deficit)(170,270,160) (136,006,587) 18,928,057 22,785,328 (151,342,103) (113,221,259) Restatement - (34,398,328) - 1,437,590 - (32,960,738) Total Net Position (100,159,183)$ (106,043,072)$ 287,779,260$ 279,844,483$ 187,620,077$ 173,801,411$ (Unaudited) MD&A 5 The business-type activities experienced an increase of $7,934,777 in the net position balance is primarily due to the increase in net position in the Sewer Fund in the amount of $5,788,316 and Water Fund of $1,386,951. The increase is the result operating surplus. The following table provides a summary of the City's changes in net position: STATEMENT OF CHANGES IN NET POSITION Governmental Activities Business-type Activities Total Primary Government 2016 2015 2016 2015 2016 2015 Revenue Program Revenues: Charges for services 31,393,403$ 25,469,276$ 40,187,376$ 38,400,344$ 71,580,779$ 63,869,620$ Operating grants and contributions 6,808,596 5,534,565 - - 6,808,596 5,534,565 Capital grants and contributions 368,000 275,000 - - 368,000 275,000 General Revenues: Sales taxes 17,932,528 17,758,320 - - 17,932,528 17,758,320 Property taxes 45,610,041 45,840,494 - - 45,610,041 45,840,494 Utility taxes 6,661,934 7,081,574 - - 6,661,934 7,081,574 Income taxes 7,155,930 8,266,906 - - 7,155,930 8,266,906 Other 19,399,072 15,601,822 (245,486) 301,360 19,153,586 15,903,182 Investment income 118,340 29,574 59,146 26,946 177,486 56,520 Total Revenue 135,447,844 125,857,531 40,001,036 38,728,650 175,448,880 164,586,181 Expenses General management and support 18,162,579 12,493,241 - - 18,162,579 12,493,241 Public safety 55,625,369 57,442,662 - - 55,625,369 57,442,662 Public works 13,668,315 20,011,068 - - 13,668,315 20,011,068 Health and human resources development 3,319,396 2,910,927 - - 3,319,396 2,910,927 Recreation and cultural opportunities 14,379,964 10,531,792 - - 14,379,964 10,531,792 Housing and economic development 21,062,983 14,793,647 - - 21,062,983 14,793,647 Interest 3,778,833 3,756,570 - - 3,778,833 3,756,570 Water - - 11,450,783 10,748,028 11,450,783 10,748,028 Sewer - - 6,683,233 6,608,184 6,683,233 6,608,184 Solid Waste - - 4,966,872 5,150,448 4,966,872 5,150,448 Motor vehicle parking system - - 8,531,887 7,861,680 8,531,887 7,861,680 Total Expense 129,997,439 121,939,907 31,632,775 30,368,340 161,630,214 152,308,247 Increase (decrease) in net position before transfers 5,450,405 3,917,624 8,368,261 8,360,310 13,818,666 12,277,934 Transfers 433,484 631,410 (433,484) (631,410) - - Increase/(Decrease) in Net Position 5,883,889 4,549,034 7,934,777 7,728,900 13,818,666 12,277,934 Net Position - Beginning (106,043,072) (76,193,778) 279,844,483 270,677,993 173,801,411 194,484,215 Net Position - Ending (100,159,183)$ (71,644,744)$ 287,779,260$ 278,406,893$ 187,620,077$ 206,762,149$ (Unaudited) MD&A 6 Financial Analysis of the City's Funds Governmental Funds As discussed, governmental funds are reported in the fund statement with a short-term inflow and outflow of spendable resources focus. This information is useful in assessing resources available at the end of the period in comparison with upcoming financing requirements. Governmental funds reported fund balances of $40,603,375 as of December 31, 2016 which includes $18,523,340 restricted, $2,996,226 committed, $12,714,096 assigned and $6,369,713 unassigned fund balance. The restricted fund balance consists of amounts required to be set aside by external authorities. Fund Balance Amounts reported for governmental activities are different than the statement of net position because of the treatment of capital assets, liabilities, payables and most importantly pension liabilities. This reporting difference is clearly stated on page 10 of this report. Major Governmental Funds The General Fund is the City's primary operating fund and the largest source of day-to-day service delivery. The fund balance of the General Fund reported an increase of $963,097. The increase is due to inter-fund transfers to the General Fund in the amount of $4,052,652 offset by excess of expenditures over revenues in the amount of $3,089,555. The 2015 Annual Budget did not include the change in treatment of Police and Firefighter Pension employer contributions, which are now included in the General Fund. 2016 was the first time that these transfers were included in the Adopted Budget documents. These had previously been reported in a separate fund. This increase involved the inclusion of Property tax and Personal Property Replacement Taxes formerly included in the Police and Firefighter Pension funds. These revenues are now included in the General Fund and then transferred to the respective pension fund both in budget and in practice. The fund balance of the General Obligation Debt Fund had a decrease of $1,850,120, from $2,596,116 to $745,996 principally due to changing of bond maturity dates from 1/1 to 12/1 for certain bond issues. The Employer Pension Contribution Fund has been eliminated in 2015 with the implementation of GASB 67/68 Statements. These expenditures and revenues are now included in the General Fund. Combined Nonmajor Governmental Funds Combined nonmajor fund balances totaled $28,189,445, an increase of $4,367,337 from prior period of $23,822,108. Non-major funds with surpluses for the fiscal year include Economic Development, Affordable Housing, Community Development Block Grant, Community Development Loan, General Assistance, Howard Ridge TIF, Capital Improvements and Special Assessment Capital Projects. Nonmajor funds with deficits for the period include Motor Fuel, Emergency Telephone System, Home Fund, SSD #4, SSD #5, Chicago Main TIF, Howard Hartrey TIF, Washington National TIF, Dempster Dodge TIF and West Evanston TIF. (Unaudited) MD&A 7 Proprietary Funds The proprietary fund statements share the same focus as the government -wide statements, reporting both short-term and long-term information about financial status. The proprietary funds operated by the City are the Water, Sewer, Solid Waste and Parking Funds. These funds have a combined increase of $7,934,777 in the net position. The Sewer Fund reported the highest increase in the amount of $5,788,316. This increase is mainly due to the operating surplus and reduced debt service expense. The Water, Solid Waste and Parking Funds added $1,386,951, $120,503 and $639,007 respectively to the net position during the year. Although net position in these proprietary funds showed an overall healthy increase, it is important to keep in mind that the Sewer Fund carries a substantial debt level followed by Parking and Water Funds with lesser debts. Internal Service Funds The City's combined internal service fund’s net position decreased by $2,443,514 from $9,318,153,as of January 1, 2016 to $6,874,639 as of December 31, 2016. Fleet Fund and Equipment Replacement reported a combined net increase in net position of $189,015. The net deficit in the Insurance Fund increased by $2,632,529 mainly due to increase in potential claim liabilities. General Fund Budgetary Highlights Total budgetary basis revenues for the General Fund were $104,390,664 while total expenditures were $107,480,219. Overall General Fund revenue came in higher than budget by $1,094,318. Total expenditures in the General Fund were lower than budgeted amounts by $980,898. The actual net deficiency of $3,089,555 was offset by $4,052,652 in net transfers in from other funds. Capital Assets The City’s Capital Asset policy generally includes capitalizing assets or properties with $20,000 or more in value (with the exception of vehicles to the $20,000 threshold). The City's capital assets (net of depreciation) for governmental and business-type activities as of December 31, 2016, were $512,650,898. The governmental funds capital assets had a net increase of $1,567,565, while business type capital assets increased by $5,617,391. Overall, capital assets increased by 1.4% for the City as a whole. The net increase in governmental funds capital assets were principally due to an increase in capital projects for the year. Readers desiring more detailed information on capital asset activity should refer to Note 5 in the Notes to the Financial Statements. Long-Term Debt As of December 31, 2016, the City had outstanding total general obligation bonded debt of $142,009,856 of which $29,902,078 was for business type activities to be paid for by the City's Parking, Water, Solid Waste and Sewer Funds. This represents a $3,631,759 decrease from 2015. The City's general obligation debt service principal payments for 2016 totaled $15,491,759. During the current year, the City issued $20,700,000 and refunded $8,840,000 in general obligation bonds. As a home rule government under Illinois law, there is no legal debt limit for the City. Readers desiring more detailed inf ormation on long- term debt should refer to Note 8 in the Notes to the Financial Statements. (Unaudited) MD&A 8 Bond Ratings The City's general obligation bonds are rated Aa1 by Moody's Investor Rating Service and AA+ by Fitch Ratings. The City's water revenue bonds are rated Aaa and AA for uninsured issues. Economic Factors Evanston is a diverse community consisting primarily of residential homes, several nonprofit organizations including a very well-known private university, two hospitals, and many smaller scale retail shops and restaurants as well as some popular big box retailers. In general, economically sensitive revenues such as Income Tax, Sales Tax, and Real Estate Transfer Tax came in higher than budgeted revenues while Utility Taxes were below budget. New and Redevelopment construction remains strong at the University and in the City’s downtown which has added another major hotel, and mixed use multiunit housing structures. The unemployment rate in Evanston has stayed slightly below same level as many other cities in the State due in part to the stable economy that includes Northwestern University. The City continues to maintain its lower unemployment rate compared to state and federal unemployment levels. The primary employers in the City include Northwestern University, two hospitals, the local high school, and elementary school district, Rotary International, several not-for-profit organizations, and numerous retail businesses and restaurants. The City’s equalized assessed value for real property remained stable as of the end of fiscal year 2016. As of mid-2017 Cook County has reported that the City’s Equalized Assessed Valuation has increase from $2,196,021,525 to $2,670,411,769 or a 21.6% increase. Contacting the City's Financial Management This financial report is designed to provide a general overview of the City's finances, comply with finance-related laws and regulations, and demonstrate the City's commitment to public accountability. If you have questions about this report or would like to request additional information, contact the City Manager’s Office, Finance Division at the City of Evanston, 2100 Ridge Avenue, Evanston, Illinois 60201, Telephone 847-866-2934, or access the website at www.cityofevanston.org. CITY OF EVANSTON, ILLINOIS Statement of Net Position December 31, 2016 Component Unit Governmental Business-Type Evanston Public Activities Activities Total Library ASSETS Cash and equivalents 18,901,196$ 18,542,749$ 37,443,945$ 5,190,836$ Investments 20,845,279 - 20,845,279 - Receivables (net, where applicable, of allowances for uncollectibles) Property taxes 40,496,906 - 40,496,906 6,630,313 Utility taxes 810,741 - 810,741 - Accounts - 5,056,758 5,056,758 - Notes 8,143,355 219,000 8,362,355 - Special assessments 236,596 - 236,596 - Other 2,019,471 119,285 2,138,756 8,160 Due from other governments 8,099,813 - 8,099,813 310,018 Due from component unit 843,954 - 843,954 - Due from fiduciary funds 5,000 - 5,000 - Internal balances 217,508 (217,508) - - Inventories 881,649 730,417 1,612,066 - Prepaid items 2,437,950 - 2,437,950 - Capital assets Capital assets not being depreciated 26,043,940 8,884,874 34,928,814 311,380 Capital assets being depreciated, net 141,634,859 336,087,225 477,722,084 12,024,018 Total Assets 271,618,217 369,422,800 641,041,017 24,474,725 DEFERRED OUTFLOWS OF RESOURCES Pension Items - Police 13,132,006 - 13,132,006 - Pension Items - Fire 8,498,842 - 8,498,842 - Pension Items - IMRF 18,078,641 3,882,555 21,961,196 1,920,319 Total Deferred Outflows of Resources 39,709,489 3,882,555 43,592,044 1,920,319 Total Assets and Deferred Outflows of Resources 311,327,706 373,305,355 684,633,061 26,395,044 Primary Government (This statement is continued on the following page.) - 4 - CITY OF EVANSTON, ILLINOIS Statement of Net Position December 31, 2016 Component Unit Governmental Business-Type Evanston Public Activities Activities Total Library LIABILITIES Vouchers payable 6,966,964$ 4,460,998$ 11,427,962$ 164,839$ Retainage payable - 95,991 95,991 - Accrued payroll 839,121 - 839,121 - Accrued interest 340,667 334,730 675,397 - Due to other governments 442,788 - 442,788 843,954 Due to component unit 309,962 56 310,018 - Due to fiduciary fund 60,757 - 60,757 - Unearned revenue 1,246,032 - 1,246,032 - Noncurrent liabilities Due within one year 21,946,797 12,224,813 34,171,610 459,899 Due in more than one year 337,312,768 68,409,507 405,722,275 3,560,190 Total Liabilities 369,465,856 85,526,095 454,991,951 5,028,882 DEFERRED INFLOWS OF RESOURCES Pension items - Police Pension 1,524,126 - 1,524,126 - Unavailable property taxes 40,496,906 - 40,496,906 6,630,313 Total Deferred Inflows of Resources 42,021,032 - 42,021,032 6,630,313 Total Liabilities and Deferred Inflows of Resources 411,486,888 85,526,095 497,012,983 11,659,195 NET POSITION Net investment in capital assets 51,587,637 268,851,203 320,438,840 10,365,258 Restricted for Highway maintenance 1,413,678 - 1,413,678 - Emergency telephone system 163,061 - 163,061 - HUD approved projects 277,404 - 277,404 - Neighborhood improvements 4,570,319 - 4,570,319 - Capital improvements 3,915,000 - 3,915,000 - Debt service 7,597,490 - 7,597,490 29,709 General assistance 586,388 - 586,388 - Endowment - - - 3,819,857 Unrestricted (170,270,160) 18,928,057 (151,342,103) 521,025 Total Net Position (100,159,183)$ 287,779,260$ 187,620,077$ 14,735,849$ Primary Government See accompanying notes to financial statements. - 5 - CITY OF EVANSTON, ILLINOIS Statement of Activities For the Fiscal Year Ended December 31, 2016 Operating Capital FUNCTIONS/PROGRAMS Charges for Grants and Grants and PRIMARY GOVERNMENT Expenses Services Contributions Contributions Governmental Activities General management and support 18,162,579$ 10,094,107$ 5,637$ -$ Public safety 55,625,369 3,430,478 265,435 - Public works 13,668,315 1,010,818 3,424,375 243,000 Health and human resource development 3,319,396 820,210 298,193 - Recreational and cultural opportunities 14,379,964 5,559,734 419,161 - Housing and economic development 21,062,983 10,478,056 2,395,795 125,000 Interest 3,778,833 - - - Total governmental activities 129,997,439 31,393,403 6,808,596 368,000 Business-Type Activities Water 11,450,783 16,418,680 - - Sewer 6,683,233 13,048,759 - - Solid waste 4,966,872 4,031,408 - - Motor vehicles parking system 8,531,887 6,688,529 - - Total business-type activities 31,632,775 40,187,376 - - Total Primary Government 161,630,214$ 71,580,779$ 6,808,596$ 368,000$ Evanston Public Library Community Services 8,460,262$ 477,426$ 89,668$ -$ Interest 48,654 - - - Total Evanston Public Library 8,508,916$ 477,426$ 89,668$ -$ Transfers Change in Net Position Net Position, January 1 Net Position, January 1, Restated Net Position, December 31 Program Revenues - 6 - Component Unit Total Evanston Governmental Business-Type Primary Public Activities Activities Government Library (8,062,835)$ -$ (8,062,835)$ -$ (51,929,456) - (51,929,456) - (8,990,122) - (8,990,122) - (2,200,993) - (2,200,993) - (8,401,069) - (8,401,069) - (8,064,132) - (8,064,132) - (3,778,833) - (3,778,833) - (91,427,440) - (91,427,440) - - 4,967,897 4,967,897 - - 6,365,526 6,365,526 - - (935,464) (935,464) - - (1,843,358) (1,843,358) - - 8,554,601 8,554,601 - (91,427,440) 8,554,601 (82,872,839) - - - - (7,893,168) - - - (48,654) - - - (7,941,822) General Revenues Taxes Property tax 45,610,041 - 45,610,041 6,501,075 Other taxes 4,558,031 - 4,558,031 - Personal property replacement taxes 1,421,037 - 1,421,037 4,141 Sales and home rule tax 17,932,528 - 17,932,528 - Utility tax 6,661,934 - 6,661,934 - Liquor tax 2,647,321 - 2,647,321 - Parking tax 2,616,846 - 2,616,846 - Real estate transfer tax 3,527,714 - 3,527,714 - Income tax 7,155,930 - 7,155,930 - Investment income 118,340 59,146 177,486 297,849 Gain (loss) on sale of capital assets - (245,486) (245,486) - Miscellaneous 4,628,123 - 4,628,123 85,943 Transfers 433,484 (433,484) - - Total 97,311,329 (619,824) 96,691,505 6,889,008 Change in Net Position 5,883,889 7,934,777 13,818,666 (1,052,814) Net Position, January 1 (71,644,744) 278,406,893 206,762,149 15,077,630 Change in accounting principle (34,398,328) 1,437,590 (32,960,738) 711,033 Net Position, January 1, Restated (106,043,072) 279,844,483 173,801,411 15,788,663 Net Position, December 31 (100,159,183)$ 287,779,260$ 187,620,077$ 14,735,849$ Net (Expense) Revenue and Change in Net Position Primary Government See accompanying notes to financial statements. - 7 - General Nonmajor Total Obligation Governmental Governmental General Debt Service Funds Funds Cash and equivalents 1,230,734$ -$ 15,649,885$ 16,880,619$ Investments 5,093,668 1,528,279 14,223,332 20,845,279 Receivables Property taxes 28,177,453 10,879,993 1,439,460 40,496,906 Utility 810,741 - - 810,741 Notes 200,000 - 7,943,355 8,143,355 Special assessments - - 236,596 236,596 Other 1,548,313 - 456,275 2,004,588 Due from other governments 7,066,670 - 1,033,143 8,099,813 Due from component unit 193,159 - 650,484 843,643 Due from other funds 3,430,218 1,905 3,259,796 6,691,919 Advances to fiduciary funds 5,000 - - 5,000 Advances to other funds 122,663 - 39,741 162,404 Total Assets 47,878,619$ 12,410,177$ 44,932,067$ 105,220,863$ ASSETS December 31, 2016 CITY OF EVANSTON, ILLINOIS Balance Sheet Governmental Funds (This statement is continued on the following page.) - 8 - General Nonmajor Total Obligation Governmental Governmental General Debt Service Funds Funds LIABILITIES Vouchers payable 3,042,151$ 7,050$ 3,304,252$ 6,353,453$ Accrued payroll 839,121 - - 839,121 Due to other governments - - 442,788 442,788 Due to other funds 3,368,372 467,175 2,213,767 6,049,314 Due to component unit - 309,962 - 309,962 Due to fiduciary funds 60,757 - - 60,757 Advances from other funds 476,800 - 162,404 639,204 Unearned revenue 246,032 - 1,000,000 1,246,032 Total Liabilities 8,033,233 784,187 7,123,211 15,940,631 DEFERRED INFLOWS OF RESOURCES Long-term loans - - 8,179,951 8,179,951 Deferred property taxes 28,177,453 10,879,993 1,439,460 40,496,906 Total Deferred Inflows of Resources 28,177,453 10,879,993 9,619,411 48,676,857 Total Liabilities and Deferred Inflows of Resources 36,210,686 11,664,180 16,742,622 64,617,488 FUND BALANCES Restricted Highway maintenance - - 1,413,678 1,413,678 Emergency telephone system - - 163,061 163,061 HUD approved projects - - 277,404 277,404 Neighborhood improvements - - 4,570,319 4,570,319 Capital improvements - - 3,915,000 3,915,000 Debt service - 745,997 6,851,493 7,597,490 Township - - 586,388 586,388 Committed - economic development - - 2,996,226 2,996,226 Assigned Capital improvements - - 7,668,458 7,668,458 Other 5,045,638 - - 5,045,638 Unassigned 6,622,295 - (252,582) 6,369,713 Total Fund Balances 11,667,933 745,997 28,189,445 40,603,375 Total Liabilities, Inflows of Resources, and Fund Balances 47,878,619$ 12,410,177$ 44,932,067$ 105,220,863$ December 31, 2016 CITY OF EVANSTON, ILLINOIS Balance Sheet Governmental Funds See accompanying notes to financial statements. - 9 - Governmental Activities in the Statement of Net Position Fund Balances of Governmental Funds 40,603,375$ Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the governmental funds Total governmental capital assets 167,678,799$ Less internal service fund portion 8,223,587 159,455,212 OPEB liability payable is not due and payable in the current period and, therefore, is not reported in the governmental funds (2,348,788) Interest payable is not due and payable in the current period and, therefore, not reported in the governmental funds (340,667) Long-term liabilities, including bonds payable, are not due and payable in the current period and, therefore, are not reported in the governmental funds General obligation bonds payable (112,107,778) Bonds premium liability (3,983,384) First Bank loan (5,128,812) Compensated absences payable (10,144,477) Net pension liability is shown as a liability on the statement of net position Illinois Municipal Retirement Fund (14,555,442) Police Pension Fund (112,304,807) Firefighters' Pension Fund (92,543,567) Differences between expected and actual experiences, assumption changes, net differences between projected and actual earnings are recognized as deferred outflows and inflows of resources on the statement of net position Illinois Municipal Retirement Fund 18,078,641 Police Pension Fund 11,607,880 Firefighters' Pension Fund 8,498,842 Deferred inflows for long-term loans are not a available and, therefore, not revenue in fund financial statements 8,179,951 The net position of the internal service fund is included in the governmental activities on the statement of net position 6,874,639 Net Position of Governmental Funds (100,159,182)$ December 31, 2016 CITY OF EVANSTON, ILLINOIS Reconciliation of Fund Balances of Governmental Funds to the See accompanying notes to financial statements. - 10 - General Nonmajor Total Obligation Governmental Governmental General Debt Service Funds Funds Revenues Taxes 54,336,773$ 10,438,928$ 11,271,229$ 76,046,930$ Licenses and permits 17,933,413 - - 17,933,413 Special assessments - - 168,571 168,571 Intergovernmental 18,445,108 80,089 6,360,510 24,885,707 Charges for services 8,694,803 - 96,586 8,791,389 Fines and forfeits 3,611,901 - - 3,611,901 Investment income 30,285 24,264 63,791 118,340 Miscellaneous 1,338,381 - 2,553,212 3,891,593 Total Revenues 104,390,664 10,543,281 20,513,899 135,447,844 Expenditures Current General management and support 15,929,441 138,088 996,692 17,064,221 Public safety 60,939,168 - 1,313,253 62,252,421 Public works 13,240,692 - 235,759 13,476,451 Health and human resource development 3,021,327 - - 3,021,327 Recreational and cultural opportunities 11,893,837 - - 11,893,837 Housing and economic development 2,455,754 - 8,021,413 10,477,167 Capital outlay - - 9,953,056 9,953,056 Debt service Principal - 19,255,943 405,000 19,660,943 Interest - 4,198,920 77,398 4,276,318 Fiscal charges - 11,525 2,000 13,525 Total Expenditures 107,480,219 23,604,476 21,004,571 152,089,266 Excess (Deficiency) of Revenues Over Expenditures (3,089,555) (13,061,195) (490,672) (16,641,422) Other Financing Sources (Uses) Issuance of bonds - 7,635,000 9,450,000 17,085,000 Issuance of loans - - 1,580,000 1,580,000 Premium (discount) on bonds issued - 576,196 411,032 987,228 Transfers in 8,099,626 2,999,879 4,911,555 16,011,060 Transfers in (Component Unit)- - - Transfers (out)(4,046,974) - (11,494,578) (15,541,552) Total Other Financing Sources (Uses)4,052,652 11,211,075 4,858,009 20,121,736 Net Change in Fund Balances 963,097 (1,850,120) 4,367,337 3,480,314 Fund Balances, January 1 10,704,836 2,596,116 23,822,108 37,123,060 Fund Balances, December 31 11,667,933$ 745,996$ 28,189,445$ 40,603,374$ CITY OF EVANSTON, ILLINOIS Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Fiscal Year Ended December 31, 2016 See accompanying notes to financial statements. - 11 - Net Change in Fund Balances - Total Governmental Funds 3,480,314$ Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlay as expenditures; however, they are capitalized and and depreciated in the statement of activities 10,845,704 Some expenses in the statement of net assets (e.g., depreciation) do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds Depreciation (9,440,078) The loss on disposal of capital assets increases the expense on the statement of activities (21,224) The issuance of long-term debt is reported as an other financing sources in governmental funds, but as an increase of principal outstanding in the statement of activities (19,652,228) The repayment of long-term debt is reported as an expenditure when due in governmental funds but as a reduction of principal outstanding in the statement of activities 19,660,943 The amortization of premium on long-term debt is reported as a reduction of interest expense on the statement of activities 477,563 Changes in net other postemployment benefits obligations are reported only in the statement of activities (472,069) The change in compensated absences payable is shown as an expense on the statement of activities (1,153,096) The change in the accrual of interest is reported as interest expense on the statement of activities 33,447 The change in the net pension liability is reported only in the statement of activities Illinois Municipal Retirement Fund (10,819,895) Police Pension Fund (7,415,176) Firefighters' Pension Fund (6,141,403) The change in deferred inflows and outflows of resources is reported only in the statement of activities Illinois Municipal Retirement Fund 7,188,434 Police Pension Fund 13,640,046 Firefighters' Pension Fund 8,498,842 The changed in deferred inflows for long-term loans is not expense on the statement of activities (382,721) Internal service funds are reported separately in the fund financial statements (2,443,514) Change in Net Position of Governmental Activities 5,883,889$ CITY OF EVANSTON, ILLINOIS Reconciliation of Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Governmental Activities in the Statement of Activities For the Fiscal Year Ended December 31, 2016 See accompanying notes to financial statements. - 12 - CITY OF EVANSTON, ILLINOIS Statement of Net Position Proprietary Funds December 31, 2016 Governmental Activities - Motor Vehicle Internal Service Water Sewer Solid Waste Parking System Total Funds Current Assets Cash and cash equivalents 7,631,931$ 1,952,787$ -$ 8,958,031$ 18,542,749$ 2,020,577$ Receivables Accounts - water and sewerage charges Accounts - billed 1,043,065 202,540 131,458 - 1,377,063 - Accounts - unbilled 1,082,780 2,014,950 581,965 - 3,679,695 - Other 2,218 60,042 44,740 12,285 119,285 14,883 Inventories 581,144 149,272 - - 730,416 881,649 Prepaid items - - - - - 2,437,950 Due from other funds 1,171,215 1,456,315 - 29,131 2,656,661 444,750 Due from component unit - - - - - 311 Advances to other funds - - - 476,800 476,800 - Total Current Assets 11,512,353 5,835,906 758,163 9,476,247 27,582,669 5,800,120 Noncurrent Assets Capital assets Capital assets not being depreciated 1,293,200 629,820 - 6,961,854 8,884,874 - Capital assets being depreciated 109,509,667 253,931,461 - 86,862,889 450,304,017 24,263,091 Accumulated depreciation (25,142,763) (57,853,833) - (31,220,196) (114,216,792) (16,039,504) Total Capital Assets 85,660,104 196,707,448 - 62,604,547 344,972,099 8,223,587 Other assets Notes receivable - - - 219,000 219,000 - Total Noncurrent Assets 85,660,104 196,707,448 - 62,823,547 345,191,099 8,223,587 Total Assets 97,172,457 202,543,354 758,163 72,299,794 372,773,768 14,023,707 Deferred Outflows of Resources Pension items - IMRF 2,357,058 554,907 365,332 605,258 3,882,555 - Total Deferred Outflows of Resources 2,357,058 554,907 365,332 605,258 3,882,555 - Total Assets and Deferred Outflows of Resources 99,529,515 203,098,261 1,123,495 72,905,052 376,656,323 14,023,707 (This statement is continued on the following page.) - 13 - CITY OF EVANSTON, ILLINOIS Statement of Net Position Proprietary Funds December 31, 2016 Governmental Activities - Motor Vehicle Internal Service Water Sewer Solid Waste Parking System Total Funds Current Liabilities Vouchers payable 2,278,252$ 874,313$ 211,243$ 1,097,190$ 4,460,998$ 613,511$ Retainage payable - 9,132 - 86,859 95,991 - Interest payable - restricted 61,877 249,095 - - 310,972 - Interest payable - - 153 23,605 23,758 - Notes payable - IEPA 110,787 6,553,398 - - 6,664,185 - Current portion of GO bonds payable 913,045 396,366 19,206 4,048,509 5,377,126 - Claims payable - - - - - 2,269,750 Due to other funds 1,233,656 - 1,454,116 663,196 3,350,968 393,047 Due to component unit 40 - - 16 56 - Compensated absences payable 124,707 26,135 5,870 26,790 183,502 26,580 Total Current Liabilities 4,722,364 8,108,439 1,690,588 5,946,165 20,467,556 3,302,888 Noncurrent Liabilities Notes payable - IEPA 1,792,233 36,799,819 - - 38,592,052 - General obligation bonds payable 19,909,693 2,435,885 42,486 3,161,161 25,549,225 - OPEB liability 238,261 68,734 45,588 55,722 408,305 81,742 Net pension liability - IMRF 1,897,710 446,765 294,135 487,304 3,125,914 - Claims payable - - - - - 3,658,120 Compensated absences payable 498,830 104,541 23,481 107,159 734,011 106,318 Total Long-Term Liabilities 24,336,727 39,855,744 405,690 3,811,346 68,409,507 3,846,180 Total Liabilities 29,059,091 47,964,183 2,096,278 9,757,511 88,877,063 7,149,068 Net Position (Deficit) Net investment in capital assets 62,934,346 150,521,980 - 55,394,877 268,851,203 8,223,587 Unrestricted 7,536,078 4,612,098 (972,783) 7,752,664 18,928,057 (1,348,948) Total Net Position (Deficit)70,470,424$ 155,134,078$ (972,783)$ 63,147,541$ 287,779,260$ 6,874,639$ See accompanying notes to financial statements. - 14 - CITY OF EVANSTON, ILLINOIS Combining Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds For the Fiscal Year Ended December 31, 2016 Governmental Activities - Motor Vehicle Internal Service Water Sewer Solid Waste Parking System Total Funds Operating Revenues Charges for services 15,771,371$ 13,027,159$ 4,020,050$ 6,526,741$ 39,345,321$ 21,910,336$ Miscellaneous 647,309 21,600 11,358 161,788 842,055 19,564 Total Operating Revenues 16,418,680 13,048,759 4,031,408 6,688,529 40,187,376 21,929,900 Operating Expenses Excluding Depreciation Administration 1,287,200 1,530,718 1,008,326 1,968,368 5,794,612 - Operations 7,536,931 358,134 3,956,295 3,356,819 15,208,179 22,776,930 Total Operating Expenses Excluding Depreciation 8,824,131 1,888,852 4,964,621 5,325,187 21,002,791 22,776,930 Operating Income (Loss) Before Depreciation 7,594,549 11,159,907 (933,213) 1,363,342 19,184,585 (847,030) Depreciation 1,973,593 3,461,103 - 2,836,672 8,271,368 1,624,108 Operating Income (Loss)5,620,956 7,698,804 (933,213) (1,473,330) 10,913,217 (2,471,138) Non-Operating Revenue (Expenses) Investment income 16,537 4,450 - 38,159 59,146 218 Interest expense (653,059) (1,333,278) (2,251) (370,028) (2,358,616) - Gain (loss) on disposal of capital assets (227,924) - - (17,562) (245,486) 63,430 Total Non-Operating Revenues (Expenses)(864,446) (1,328,828) (2,251) (349,431) (2,544,956) 63,648 Income (Loss) Before Transfers 4,756,510 6,369,976 (935,464) (1,822,761) 8,368,261 (2,407,490) Transfers Transfers in - - 1,055,967 3,711,768 4,767,735 - Transfers (out)(3,369,559) (581,660) - (1,250,000) (5,201,219) (36,024) Total Transfers (3,369,559) (581,660) 1,055,967 2,461,768 (433,484) (36,024) Net Income 1,386,951 5,788,316 120,503 639,007 7,934,777 (2,443,514) Net Position (Deficit), January 1 68,210,727 149,140,298 (1,228,557) 62,284,425 278,406,893 9,318,153 Change in accounting principle 872,746 205,464 135,271 224,109 1,437,590 - Net Position (Deficit), January 1, Restated 69,083,473 149,345,762 (1,093,286) 62,508,534 279,844,483 9,318,153 Net Position (Deficit), December 31 70,470,424$ 155,134,078$ (972,783)$ 63,147,541$ 287,779,260$ 6,874,639$ See accompanying notes to financial statements. - 15 - CITY OF EVANSTON, ILLINOIS Statement of Cash Flows Proprietary Funds For the Fiscal Year Ended December 31, 2016 Governmental Activities - Motor Vehicle Internal Service Water Sewer Solid Waste Parking System Total Funds Cash Flows from Operating Activities Receipts from customers and users 16,066,716$ 13,011,723$ 3,973,581$ 6,694,529$ 39,746,549$ 13,297,160$ Receipts from/(payments for) interfund services provided 134,940 (1,567,296) (53,856) 239,090 (1,247,122) 9,820,745 Payments to suppliers (7,427,304) (213,983) (4,034,014) (2,452,155) (14,127,456) (6,178,905) Payments to employees (812,423) (1,415,643) (921,444) (1,827,474) (4,976,984) (2,916,171) Payments for insurance premiums - - - - - (12,474,198) Net Cash Provided from Operating Activities 7,961,929 9,814,801 (1,035,733) 2,653,990 19,394,987 1,548,631 Cash Flows from Noncapital Financing Activities Transfers in (out)(3,369,559) (581,660) 1,055,967 2,461,768 (433,484) (36,024) Net Cash from Noncapital Financing Activities (3,369,559) (581,660) 1,055,967 2,461,768 (433,484) (36,024) Cash Flows from Capital and Related Financing Activities Sale of capital assets 5,204,141 4,930 - - 5,209,071 65,654 Acquisition and construction of capital assets (13,290,981) (1,260,988) - (3,215,230) (17,767,199) (1,810,418) Proceeds from general obligation bonds 3,615,000 - - - 3,615,000 - Principal paid on general obligation bonds (671,413) (383,570) (17,945) (3,527,329) (4,600,257) - Interest paid on general obligation bonds (645,123) (1,374,939) (2,289) (379,753) (2,402,104) - Principal paid on IEPA loans (109,936) (6,534,999) - - (6,644,935) - Net Cash from Capital and Related Financing Activities (5,898,312) (9,549,566) (20,234) (7,122,312) (22,590,424) (1,744,764) Cash Flows from Investing Activities Interest income 16,537 4,450 - 38,159 59,146 218 Net Cash from Investing Activities 16,537 4,450 - 38,159 59,146 218 Net Increase (Decrease) in Cash and Cash Equivalents (1,289,405) (311,975) - (1,968,395) (3,569,775) (231,939) Cash and Cash Equivalents Beginning 8,921,336 2,264,762 - 10,926,426 22,112,524 2,252,516 Ending 7,631,931$ 1,952,787$ -$ 8,958,031$ 18,542,749$ 2,020,577$ (This statement is continued on the following page.) - 16 - CITY OF EVANSTON, ILLINOIS Statement of Cash Flows Proprietary Funds For the Fiscal Year Ended December 31, 2016 Governmental Activities - Motor Vehicle Internal Service Water Sewer Solid Waste Parking System Total Funds Reconciliation of Operating Income (Loss) to Net Cash Provided from Operating Activities Operating income (loss)5,620,956$ 7,698,804$ (933,213)$ (1,473,330)$ 10,913,217$ (2,471,138)$ Adjustments to reconcile operating income (loss) to net cash provided from operating activities Depreciation 1,973,593 3,461,103 - 2,836,672 8,271,368 1,624,108 Changes in assets and liabilities Accounts receivable (351,964) (37,036) (57,827) 1,000 (445,827) (8,645) Notes receivable - - - 5,000 5,000 - Interfund receivable 377,670 (1,456,315) - 119,200 (959,445) 1,306,594 Prepaid expenses - - - - - (572,531) Inventories (44,327) 12,601 - - (31,726) (74,773) Compensated absences (20,401) (4,155) (1,584) 16,316 (9,824) 37,263 OPEB liability 21,715 7,766 15,084 3,002 47,567 9,411 Pension items - IMRF 429,011 111,464 73,382 121,576 735,433 - Vouchers payable 153,954 122,418 (77,719) 869,016 1,067,669 116,429 Retainage payable - 9,132 - 35,648 44,780 - Interfund payable (198,278) (110,981) (53,856) 119,890 (243,225) (118,589) Claims payable - - - - - 1,700,502 Net Cash Provided from Operating Activities 7,961,929$ 9,814,801$ (1,035,733)$ 2,653,990$ 19,394,987$ 1,548,631$ See accompanying notes to financial statements. - 17 - CITY OF EVANSTON, ILLINOIS Statement of Fiduciary Net Position Fiduciary Funds December 31, 2016 Pension Trust Assets Investments at fair value Cash and cash equivalents 5,483,608$ U.S. Treasury obligations 13,765,989 U.S. agency obligations 13,970,458 Corporate bonds 27,079,664 Common stock 30,967,565 Equity mutual funds 85,019,707 Receivables Accrued interest 449,697 Due from other governments 60,757 Other 55,276 Total Assets 176,852,721 Liabilities Accounts payable 61,178 Total Liabilities 61,178 Net Position Restricted For Pensions 176,791,543$ See accompanying notes to financial statements. - 18 - CITY OF EVANSTON, ILLINOIS Statement of Changes in Fiduciary Net Position Fiduciary Funds For the Fiscal Year Ended December 31, 2016 Additions Contributions - employer 16,833,964$ Contributions - plan members 2,728,938 Miscellaneous income 13,501 Total Contributions 19,576,403 Investment income Net appreciation in fair value of investments 7,613,446 Interest on investments 4,273,085 Less investment expenses (446,906) Total Investment Income 11,439,625 Total Additions 31,016,028 Deductions Administration 209,550 Benefit payments 19,263,994 Refunds of contributions 50,862 Total Deductions 19,524,406 Net Increase 11,491,622 Net Position Restricted For Pensions January 1 165,299,921 December 31 176,791,543$ See accompanying notes to financial statements. - 19 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 Page(s) Note 1 Summary of Significant Accounting Policies A. Reporting Entity 23-24 B. Government-Wide and Fund Financial Statements 24 C. Fund Accounting 25 D. Measurement Focus, Basis of Accounting, and Financial Statement Presentation 26-28 E. Cash and Cash Equivalents 28 F. Investments 28 G. Inventories and Prepaid Items 28 H. Capital Assets 29 I. Compensated Absences 29 J. Long-Term Obligations 29 K. Self-Insurance 30 L. Deferred Inflows of Resources 30 M. Property Taxes 30 N. Fund Equity 31 O. Interfund Transactions 31 P. Use of Estimates 32 Q. Conduit Debt 32 Note 2 Stewardship, Compliance, and Accountability A Deficit Fund Equity 33 Note 3 Deposits With Financial Institutions and Investments A. Types of Accounts and Securities 34 B. Pooling Cash and Investments 34 C. Types of Investments 35 D. Deposits 35 Note 4 Receivables A. Summary of Receivables 36 B. Notes Receivable - Special Revenue Funds 36 - 20 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 Page(s) (Continued from the previous page) Note 5 Capital Assets A. Capital Asset Activity 37-39 B. Construction Commitments 39 Note 6 Interfunds A. Interfund Accounts 40 B. Interfund Advances 41 C. Interfund Transfers 42-45 Note 7 Operating Leases 46 Note 8 Long-Term Debt A. Changes in Long-Term Debt 47-48 B. General Obligation Bonds Payable 49 C. Notes Payable - IEPA Loans 50 D. Loan with First Bank and Trust, Evanston 50 E. Postemployment Benefits other than Pensions (Defined Benefit Plan)50-52 Note 9 Fund Equity A. Restricted Net Position - Fiduciary Funds 53 B. Assigned Fund Balances 53 Note 10 Individual Fund Activities A. General Obligation Debt Service Fund 54 B. Water Fund 54 C. Special Service District No. 4 54 Note 11 Risk Management - Claims and Judgements 55 Note 12 Contingencies 56 Note 13 Joint Ventures A. Solid Waste Agency of Northern Cook County 56-57 B. Evanston Housing Corporation 57 - 21 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 Page(s) (Continued from the previous page) Note 14 Employee Retirement Systems A. Plan Descriptions 58-73 Note 15 Pension Trust Funds A. Schedule of Net Position 74 B. Changes in Plan Net Position 75 Note 16 Evanston Library Component Unit A. Types of Accounts and Securities 76 B. Reconciliation of Cash and Investments 77 C. Summary Receivables 77 D. Capital Assets Activity 77 E. Long-Term Debt 78 Note 17 Prior Period Adjustment 79 - 22 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The more significant of the City's and the Library's accounting policies are described below. A.Reporting Entity Blended Component Unit: The financial statements of the City of Evanston,Illinois (the City)and Evanston Public Library (the Library or EPL) have been prepared in conformity with accounting principles generally accepted in the United States of America as applied to governmental units (hereinafter referred to as generally accepted accounting principles (GAAP)).The Governmental Accounting Standards Board (GASB)is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. This report includes all of the funds of the City and the Library.The reporting entity for the City consists of the primary government and its component units.Component units are legally separate organizations for which the primary government is financially accountable or other organizations for which the nature and significance of their relationship with the primary government are such that their exclusion would cause the reporting entity's financial statements to be misleading.The primary government is financially accountable if (1)it appoints a voting majority of the organization's governing body and it is able to impose its will on that organization,(2)it appoints a voting majority of the organization's governing body and there is a potential for the organization to provide specific financial benefits to,or impose specific financial burdens on,the primary government,(3)the organization is fiscally dependent on and there is a potential for the organization to provide specific financial benefits to,or impose specific financial burdens on,the primary government. Certain legally separate,tax exempt organizations should also be reported as a component unit if all of the following criteria are met:(1)the economic resources received or held by the separate organization are entirely or almost entirely for the direct benefit of the primary government,its component units,or its constituents;(2)the primary government or its component units,is entitled to,or has the ability to access,a majority of the economic resources received or held by the separate organization;and (3)the economic resources received or held by an individual organization that the primary government,or its component units,is entitled to,or has the ability to otherwise access,are significant to the primary government. Component units are reported using one of two methods,discrete presentation or blending.Generally,component units should be discretely presented in a separate column in the financial statements.A component unit should be reported as part of the primary government using the blending method if it meets any one of the following criteria:(1)the primary government and the component unit have substantively the same governing body and a financial benefit or burden relationship exists;(2)the primary government and the component unit have substantively the same governing body and management of the primary government has operational responsibility for the component unit;(3)the component unit serves or benefits,exclusively or almost exclusively,the primary government rather than its citizens;or (4)the total debt of the component unit will be paid entirely or almost entirely from resources of the primary government. The Town of the City of Evanston,Illinois (the Township)has been previously presented as a separate legal entity which administers General Assistance,a public welfare program assigned by Illinois law to townships.Eligible clients received General Assistance for food,shelter,and medical needs.Through the town fund levy,the Township also supported a number of community action programs,which provided direct services to welfare recipients.The Township was governed by a Township Board of Trustees and provided services within the same geographic boundaries of the City.The Township Board of Trustees were the same individuals as the City Council.The Township board levied taxes and was responsible for adopting the Township budget and approving payment of bills.On April 30,2014,the Township was discontinued and dissolved following the March 18,2014 general election vote taken by the registered voters of the Township.Pursuant to 60 ILCS 1/27-15 and 1/27-20,effective 12:00 am May 1,2014,the City assumed all rights, powers,assets,property,obligations,and duties of the Township,including the responsibility of providing the services that were previously provided by the Township.Beginning May 1,2014,the functions of the Township are reported along with the City. - 23 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued A.Reporting Entity - Continued Discrete Component Unit: Joint Ventures: B.Government-Wide and Fund Financial Statements Separate financial statements are provided for governmental funds,proprietary funds,and fiduciary funds,even though the latter are excluded from the government-wide financial statements.Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.Nonmajor funds are reported in the supplementary information. The City participates in one joint venture,which is reported as non-equity governmental joint venture and is described in Footnote 13.The joint venture is Solid Waste Agency of Northern Cook County (SWANCC).During 2015,the Evanston Housing Corporation,a joint venture,ceased operations after a resolution to dissolve the corporation was approved by the members. The government-wide financial statements (i.e.,the statement of net position and the statement of activities)report information on all of the nonfiduciary activities of the City and the Library.The effect of interfund activity has been removed from these statements excluding interfund services provided.Governmental activities,which normally are supported by taxes and intergovernmental revenues,are reported separately from business-type activities,which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues.Direct expenses are those that are clearly identifiable with a specific function or segment.Program revenues include (1)charges to customers or applicants who purchase,use,or directly benefit from goods,services,or privileges provided by a given function or segment and (2)grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment.Taxes and other items not properly included among program revenues are reported instead as general revenues. The EPL serves the community through three branches.The EPL partners with Northwestern University and other agencies to implement digitally based science,technology,and math learning opportunities for teens.The EPL is continually focused on expanding summer reading programs to serve the patrons of all ages.The Library has also expanded community outreach by promoting library services at various local places and events. The Library Director submits a proposed budget to the EPL Board of Trustees for the upcoming calendar year.This budget is included in the budget documents submitted by the City Manager to the City Council.The Library budget is legally enacted through passage of a resolution by the EPL Board of Trustees. The EPL promotes the development of independent,self-confident,and literate citizens through the provision of open access to cultural,intellectual,and informational resources for all ages.Beginning FY 2013,the Library financials are shown separately as a discrete component unit of the City.However,the Library does not issue its own independent set of financial statements.The Library Debt Service Fund was created as a part of FY2014 budget.The Library is governed by the Library Board of Trustees. The Board members are appointed by the Mayor of the City. - 24 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued C.Fund Accounting The City and the Library use funds to report on its financial position and the results of its operations.A fund is a separate accounting entity with a self-balancing set of accounts.Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain government functions or activities. Fiduciary funds are used to account for assets held on behalf of outside parties,including other governments,or on behalf of other funds within the City.When these assets are held under the terms of a formal trust agreement,a permanent fund is used.Agency funds generally are used to account for assets that the City holds on behalf of others as their agent.The pension trust fund accounts for the activities of the Police and Firefighters'Pension Funds,which accumulate resources for pension benefit payments to retired police and fire personnel. Funds are classified into three categories:governmental,proprietary,and fiduciary.Each category,in turn,is divided into separate "fund types." Proprietary funds are used to account for activities similar to those found in the private sector,where the determination of net income is necessary or useful for sound financial administration.Goods or services from such activities can be provided either to outside parties (enterprise funds)or to other departments or agencies primarily within the City (internal service funds).Internal service funds are included with the governmental funds on the government-wide financial statements. Governmental funds are used to account for all or most of the City's general activities,including the collection and disbursement of restricted or committed monies (special revenue funds),the funds committed,restricted,or assigned for the acquisition or construction of general capital assets (capital projects funds),and the funds restricted,committed,or assigned for the servicing of general long-term debt (debt service funds).The General Fund is used to account for all activities of the City not accounted for in some other fund. - 25 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued D.Measurement Focus, Basis of Accounting, and Financial Statement Presentation 1.) Taxes 6.) Fines Property *Traffic fines Sales (home rule) Utility 7.) Intergovernmental Personal property Motor fuel tax allotments Grants 2.) Licenses Supplemental Security income reimbursements Income taxes 3.) Franchise fees Sales taxes Use tax 4.) Charges for services 8.) Investment income 5.) Recycling program fees and sales * Property taxes are defined as available if collected within at most 60 days after fiscal year end. The City reports the following major governmental funds: Governmental funds report deferred inflows of resources in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. The General Obligation Debt Fund is a debt service fund which accumulate monies for the principal and interest payments on general obligation debt. The General Fund is the City's primary operating fund.It accounts for all financial resources of the general government, except those accounted for in another fund. The City's and the Library's governmental fund 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.A six-month availability period is used for revenue recognition for all other governmental fund revenues.Expenditures generally are recorded when a liability is incurred,as under accrual accounting.However,debt service expenditures,as well as expenditures related to compensated absences, are recorded when payment is due or when amounts have been accumulated in the debt service fund for payment to be made early in the following year. The following revenues associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the City and the Library. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting,as are the proprietary fund statements.Revenues are recorded when earned and expenses are recorded when a liability is incurred,regardless of the timing of related cash flows.Property taxes are recognized as revenues in the year for which they are levied.Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. - 26 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued D.Measurement Focus, Basis of Accounting, and Financial Statement Presentation - Continued The City reports the following major proprietary funds: Additionally, the City reports the following fund types: The Library reports the Operating Fund, Endowment Fund, and Debt Service Fund. 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 enterprise funds and of the City’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 on capital assets.All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. The Water Fund accounts for the provision of water services to the residents of the City and the sale of water to the Village of Skokie,Illinois and the Northwest Water Commission.All activities necessary to provide such services are accounted for in this fund,including,but not limited to,administration,operation,maintenance,financing and related debt service, and billing and collection. Internal Service Funds account for the fleet management and insurance services provided to other departments or agencies of the government, or to other governments, on a cost reimbursement basis. The Sewer Fund accounts for the provision of sewer repair and improvement services to the residents of the City. All activities necessary to provide such services are accounted for in this fund,including administration,operations, financing, and billing and collection. The Solid Waste Fund accounts for the recycling,refuse,and yard waste removal services related fees and expenses. Refuse and yard waste are contracted out, while recycling is handled by the City staff. The Motor Vehicle Parking System accounts for the provision of the public and residential parking facility on Church Street,Maple Avenue,and Sherman Avenue,as well as all the City's parking lots and meters.All activities are accounted for including administration, operations, financing, and revenue collection. Pension Trust Funds account for the activities of the Police and Firefighters'Pension Funds,which accumulate resources for pension benefit payments to qualified public safety employees. As a general rule,the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are charges between the City's enterprise funds and various other functions of the government.Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Amounts reported as program revenues include (1)charges to customers for goods,services,or privileges provided,(2) operating grants and contributions,and (3)capital grants and contributions,including assessments.Internally dedicated resources are reported as general revenue rather than as program revenue. Likewise, general revenues include all taxes. - 27 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued D.Measurement Focus, Basis of Accounting, and Financial Statement Presentation - Continued E.Cash and Equivalents F.Investments G.Inventories and Prepaid Items Investments with a maturity of less than one year when purchased,non-negotiable certificates of deposit,and other nonparticipating investments are stated at cost or amortized cost.Investments with a maturity greater than one year when purchased and all investments of the pension trust funds are stated at fair value.Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inventories in the Water,Sewer,and Fleet Service Funds are valued at the lower of cost (first-in/first-out)or market. Inventory amounts are recorded on the basis of a physical count. The City and Library report unearned revenue and unavailable/deferred revenue on its financial statements.Unavailable revenues arise when a potential revenue does not meet both the measurable and available criteria for recognition in the current period,under the modified accrual basis of accounting.Deferred revenues arise when property tax levies are intended to finance the next fiscal year.Unearned revenue arises when a revenue is measurable but not earned under the accrual basis of accounting.Unearned revenues also arise when resources are received by the City and Library before it has a legal claim to them or prior to the provision of services,as when grant monies are received prior to the issuance of qualifying expenditures.In subsequent periods,when both revenue recognition criteria are met,or when the City and Library have a legal claim to the resources,the liability and deferred inflows of resource for unearned and unavailable/deferred revenue are removed from the financial statements and revenue is recognized. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.In governmental funds,prepaid items are recorded based on consumption method. When both restricted and unrestricted resources are available for use,it is the City and Library’s policy to use restricted resources first, then unrestricted resources as they are needed. Cash and equivalents represent cash on hand,cash deposited in interest-bearing and non-interest-bearing checking accounts,and investments in money markets,certificates of deposit,and treasury obligations with maturities of three months or less at the date of acquisition, and cash deposited with Illinois Funds. - 28 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued H.Capital Assets Description Years Description Years Land improvements 10-100 Buildings and improvements 10-50 Leasehold improvements 10-100 Office equipment and furniture 5-15 Plant 20-100 Machinery and equipment 3-15 Transmission and distribution Infrastructure 30-100 system 5-100 Library collections 7 Sewer system and Intangible assets 5-10 underground lines 75-100 Parking meters 15 I.Compensated Absences J.Long-Term Obligations Property,plant,and equipment are depreciated,and intangible assets are amortized using the straight-line method over the following estimated useful lives: A capital asset is property,such as equipment,buildings,land,utility infrastructure,roads,bridges with a cost or value equal to or greater than $20,000 (per asset)at the date of acquisition and an expected useful life of more than one year (12 months or longer).Acquisition of motor vehicles is an exception to the $20,000 threshold.Also additional cost of less than $20,000 associated with an asset may be capitalized if the expense is necessary to put the asset in service or its intended use;and/or if it extends the service life of the asset.Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets'lives are not capitalized.Infrastructure acquired prior to the February 28,2003 implementation of GASB Statement No.34 has been reported. In the fund financial statements,governmental fund types recognize bond premiums and discounts,as well as bond issuance costs,during the current period.The face amount of debt issued is reported as other financing sources.Premiums received on debt issuances are reported as other financing sources,while discounts on debt issuances are reported as other financing uses.Issuance costs,whether or not withheld from the actual debt proceeds received,are reported as debt service expenditures. In the government-wide financial statements and proprietary fund types in the fund financial statements,long-term debt, and other long-term obligations are reported as liabilities in the applicable governmental activities,business-type activities,or proprietary fund type statement of net position.Bond premiums and discounts,if material,are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium or discount. It is the City's and the Library’s policy to permit employees to accumulate earned but unused vacation and sick pay benefits.All payments due in the event of termination are accrued when incurred in the government-wide and proprietary fund financial statements.The General Fund has been used in prior years to liquidate the liability for compensated absences of governmental funds. Major outlays for capital assets and improvements are capitalized as projects are constructed.Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. - 29 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued K.Self-Insurance L.Deferred Inflows/Outflows of Resources M.Property Taxes The property tax calendar for Cook County is as follows: Description Date Lien date January 1 of levy year Levy date December of levy year First installment due date (55% of prior bill)March 1/April 1 of year following levy year Second installment due date (balance of total bill)September 1/October 1 of year following levy year In addition to assets,the statement of financial position will sometimes report a separate section for deferred outflows of resources.This separate financial statement element,deferred outflows of resources,represents a consumption of net assets that applies to a future period(s)and so will not be recognized as an outflow of resources (expense/expenditure) until then. In addition to liabilities,the statement of financial position will sometimes report a separate section for deferred inflows of resources.This separate financial statement element,deferred inflows of resources, represents an acquisition of net assets that applies to a future period(s)and so will not be recognized as an inflow of resources (revenue) until that time. Property taxes are collected by the Cook County Collector and are remitted periodically to all taxing bodies,including the City and Library.Distributions are made more often during the two main collection periods.Property taxes are levied on a calendar year basis by passage of a tax levy ordinance. The City and the Library are self-insured to certain limits for general liability claims and for workers'compensation insurance.A liability is recorded when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated.Claims liabilities are based on estimates of the ultimate cost of reported claims including future claims adjustment expenses. General liability and workers' compensation claims are paid out of the Insurance Fund. Property taxes are recognized as revenues in the year for which they are levied (i.e.,intended to finance).On this basis, property tax revenue includes all cash distributions of property tax related to the 2015 tax levy received during the fiscal period between January 1,2016 and December 31,2016.A 2%allowance for loss is reflected in the City and the Library financial statements. The 2016 tax levy collections are intended to finance the 2017 fiscal year and are not considered available for current operations and are, therefore, shown as unavailable/deferred revenue. - 30 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued N. Fund Equity O.Interfund Transactions 5.Unassigned -Includes residual positive fund balance within the General Fund which has not been classified within the other above mentioned categories.Unassigned fund balance may also include negative balances for any governmental fund if expenditures exceeds amounts restricted, committed, or assigned for those purposes. Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. All other interfund transactions are reported as transfers. 1.Nonspendable -Includes fund balance amounts that can not be spent either because they are not in spendable form or because legal or contractual stipulations require them to be maintained intact. 2.Restricted -Consists of fund balances with constraints placed on their 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.Committed -Includes fund balance amounts that are constrained for specific purposes that are internally imposed by the government through formal action of the highest level of decision-making authority.Fund balance amounts are committed through a formal action of the City.This formal action must occur prior to the end of the reporting period,but the amount of commitment,which will be subject to constraints,may be determined in the subsequent period.Any changes to the constraints imposed require the same formal action of the City that originally created the commitment. Assignments may not create unassigned deficits in any fund.However,nonspendable,restricted,or committed fund balance may create an unassigned deficit.Also,restricted,committed,and assigned balances themselves may not be negative. 4.Assigned -Includes spendable fund balance amounts that are intended to be used for specific purposes that are not considered restricted or committed.Fund balance may be assigned through the following:(1)Council may take official action to assign amounts,(2)all remaining positive spendable amounts in governmental funds,other than the General Fund, that are neither restricted nor committed. Assignments may take place after the end of the reporting period. The City has established a policy requiring a minimum of 16.6%or two months of operating expenditures to be maintained as a reserve. This is reported as unassigned fund balance. The City and the Library consider restricted amounts to be spent first when both restricted and unrestricted fund balance is available unless there are legal documents/contracts that prohibit doing this, such as in grant agreements requiring dollar for dollar spending.Additionally,the City and the Library would first use committed,then assigned,and lastly unassigned amounts of unrestricted fund balance when expenditures are made. Governmental fund equity is classified as fund balance.In February 2009,GASB issued Statement No.54,Fund Balance Reporting and Governmental Fund Type Definitions.This statement establishes fund balance classifications based primarily on the extent to which the government is bound to honor constraints on the use of the resources reported in each governmental fund as well as establishes additional notes disclosures regarding fund balance classification policies and procedures.The City Council may,by an ordinance,establish,modify,or remove a fund balance commitment.In accordance with GASB Statement No.54,the City and the Library classifies governmental fund balance as follows: - 31 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued P.Use of Estimates Q.Conduit Debt The City approved the issuance of $5,000,000 Series 2010 Revenue Bonds during the fiscal year 2010-2011 to provide financial assistance to Chiravalle Montessori School,deemed to be in public interest.The use of proceeds includes the property purchase from the City,improvement to the existing building,refinancing existing debt,and payment of miscellaneous costs.The bonds are secured by the property or mortgages financed and are payable from the monies, securities,and other revenues pledged under the indenture by the school.The City is not obligated in any manner for the repayment of bonds.Accordingly,the bonds outstanding are not reported as a liability in these financial statements.As of December 31, 2016, outstanding bond balance was $4,315,000. In preparing financial statements,management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities,the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.Actual results could differ from those estimates. The City approved the issuance of $13,590,000 Series 2011 Revenue Bonds during the fiscal period ended December 31, 2011 to provide financial assistance to Roycemore School,deemed to be in public interest.The use of proceeds includes the property purchase and renovation of 1201 Davis,the new location of the school,and payment of miscellaneous costs. The bonds are secured by the property or mortgages financed and are payable from the moneys,securities,and other revenues pledged under the indenture by the school.The City is not obligated in any manner for the repayment of bonds. Accordingly,the bonds outstanding are not reported as a liability in these financial statements.As of December 31,2016, outstanding bond balance was $12,855,000. - 32 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 2.STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A.Deficit Fund Equity The Insurance Fund,an internal service fund,had a net deficit of $2,297,025 as of December 31,2016.The City plans to use current resources to pay for future liabilities. The Solid Waste Fund had a net deficit of $972,783 as of December 31,2016.The City plans to use current resources to pay for future liabilities. The Special Service District No.4 had a net deficit of $192,276 as of December 31,2016.The City plans to use current resources to pay for future liabilities. The Howard Ridge Tax Increment District Fund had a net deficit of $84 as of December 31,2016.The City plans to use current resources to pay for future liabilities. The Dempster-Dodge Tax Increment District Fund had a net deficit of $29,415 as of December 31,2016.The City plans to use current resources to pay for future liabilities. - 33 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 3.DEPOSITS WITH FINANCIAL INSTITUTIONS AND INVESTMENTS A.Types of Accounts and Securities B.Pooling of Cash and Investments The City and pension funds categorize the fair value measurements within the fair value hierarchy established by generally accepted accounting principles.The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets;Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. Illinois Statutes and the City's investment policies authorize the City to invest in obligations of the U.S.Treasury,in Government Sponsored Enterprises (GSE)such as Federal Home Loan Mortgage Corporation (FHLMC),Federal Home Loan Bank (FHLB),and Fannie Mae (FNMA);bankers acceptances as well as commercial paper rated only in the highest tier; repurchase agreements of the highest grade;collateralized certificates of deposit issued by FDIC insured financial institutions, money market mutual funds with portfolios limited to securities guaranteed by the United States Government,the Illinois Metropolitan Investment Fund (IMET), and Illinois Funds. It is the policy of the City to invest public funds in a manner whereby its investment objectives are prioritized in the following order:safety of principal,liquidity,and rate of return.The City also seeks to maintain diversification of investments to avoid overconcentration of any one specific issuer or business sector.To mitigate interest rate risk,the City tries to structure the investment portfolio to meet daily cash flow needs so as to avoid needing to sell securities on the open market.The City seeks to attain market rates of return consistent with constraints imposed by safety and cash flow needs.The City invests to conform to all state and local statutes governing the investment of public funds.More detail is available in the City's investment policy. The Firefighters'and Police Pension Funds are set up for the exclusive purpose of providing retirement and other benefits to plan participants and beneficiaries.All investments are governed and authorized by the respective Fire and Police Pension Boards.The investment objectives and parameters mirror those listed above for the City.However,unlike the City's public funds,the Firefighters'and Police Pension Funds may invest in various equity accounts up to a limit of 65%of the aggregate value of each respective fund's assets.The pension funds invest to conform to all state and local statutes governing pension funds. Additional detail is available in each pension fund's investment policies. Except for cash and investments in certain restricted and special accounts,the City pools the cash of various funds to maximize interest earnings. Interest income is allocated to the various funds based upon their respective participation. - 34 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 3.DEPOSITS WITH FINANCIAL INSTITUTIONS AND INVESTMENTS – Continued C.Types of Investments Illinois Funds $ 9,749,652 PMA 22,084,539 IMET money market 1,583,351 $ 33,417,542 D.Deposits Deposits consist of deposits in interest-bearing and non-interest-bearing checking accounts.At December 31,2016,the carrying amount of the City's deposits,including cash on hand of $12,813 was $26,842,696.The financial institutions' balances totaled $27,240,882. Interest Rate Risk.The City's investment policy does not limit investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates.The objective is to maintain a core portfolio with maturities primarily in the three month to three years range. Credit Risk.State law limits investments in commercial paper,corporate bonds,and mutual bonds funds to the top two ratings issued by nationally recognized statistical rating organizations.The City's investment policy does not impose further limits on investment choices.The Police and Firefighters'Pension Funds have investments in corporate bonds with S&P ratings ranging from BBB-to AAA.Illinois Funds and money markets were rated AAA by Standard &Poor's.IMET exclusively invests in AAA Standard &Poor's securities,such as treasury and agency obligations.IMET's Convenience Fund collateralizes all of its deposits 110%.Illinois Funds and IMET are an investment pools managed by the State of Illinois, Office of the Treasurer,and a Board of Trustees,which allows governments within the State to pool their funds for investment purposes.They are not registered with the SEC as an investment company,but do operate in a manner consistent with Rule 2a7 of the Investment Company Act of 1940.The investments in the securities of the U.S.government agencies were all rated AAA or Aaa by the Standard &Poor’s and by Moody’s Investor’s Services.The following investments of the City in Illinois Funds, PMA, and IMET are valued at the funds' share price, the price for which the investments could be sold. Custodial Credit Risk.For an investment,custodial credit risk is the risk that,in the event of the failure of the counterparty, the City will not be able to recover the value of its investment or collateral securities that are in the possession of an outside party.All of the City's investments were insured,registered,or held by the counterparty’s trust department in the City’s name. On September 29,2014,IMET was informed of defaults on certain loans believed to be guaranteed in its Convenience Fund caused by fraud on the part of First Farmer's Financial (FFF),a USDA approved lender.This resulted in a decrease in the value of the City's IMET investment in the amount of $552,862 and leaving an impairment on the remaining balance of $636,088. The City believes that it will recover the remaining value of the investment. Concentration of Credit Risk.It is the policy of the City to diversify its investment portfolio.Investments shall be diversified to eliminate the risk of loss resulting from overconcentration in a security,maturity,issuer,or class of securities.At December 31, 2016, the City had 66.09% of investments held at PMA. Custodial Credit Risk.For a deposit,custodial credit risk is the risk that,in the event of the failure of the counterparty,the City will not be able to recover the value of its deposit or collateral securities that are in the possession of an outside party. All of the City's deposits were insured, collateralized, or filed by the counterparty's trust department in the City's name. The City has the following recurring fair value measurements as of December 31,2016.The investments in U.S.agency obligations,corporate fixed income and corporate common stocks are valued using quoted matrix pricing models (Level 2 inputs).Mutual funds are measured based on the net asset value of the shares in the fund,which is based on the fair value of the underlying investments in the mutual fund (Level 3 input). Total - 35 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 4.RECEIVABLES A.Summary of Receivables General Governmental Business-Type Activities Activities Total Receivables (net, where applicable, of allowances for uncollectibles): Property taxes 40,496,906$ -$ 40,496,906$ Utility taxes 810,741 - 810,741 Accounts - 5,056,758 5,056,758 Notes 8,143,355 219,000 8,362,355 Special assessments 236,596 - 236,596 Other 2,019,471 119,254 2,138,725 Net Total Receivables 51,707,069$ 5,395,012$ 57,102,081$ B.Notes Receivable - Special Revenue Funds Interest Loans Loan Rates Beginning Made Repayments Ending 0% - 8%8,562,672$ 166,768$ 786,085$ 7,943,355$ Receivables as of December 31,2016 for the government’s individual major funds,nonmajor,internal service funds and fiduciary funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows: The City makes loans to city residents for the rehabilitation of single-family and multi-family housing.Initial funding for these loans was from Community Development Block Grant (CDBG)and Housing and Urban Development (HUD)Funds.Three types of loans are made:(1)title transfer loans which are due in full when the housing unit is sold,(2)amortizing loans which are due in monthly installments over varying lengths of time,and (3)forgiveable loans which are forgiven over varying lengths of time based on occupancy requirements.Repayments of principal and any interest earned on these receivables,which are recorded in the respective Special Revenue Funds,are used to make additional rehabilitation loans.An allowance of $78,000 exists in the Special Revenue Funds due to doubtful accounts. Loan activity for the current period is summarized as follows: Governmental funds report deferred inflows of resources in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received, but not yet earned. - 36 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 5. CAPITAL ASSETS A. Capital Asset Activity Capital asset activity for the fiscal year ended December 31, 2016 was as follows: Beginning Additions Deletions Transfers Ending Governmental Activities: Capital assets, not being depreciated: Land 7,212,044$ -$ 19,000$ -$ 7,193,044$ Right of way 18,695,896 - - - 18,695,896 Artwork 155,000 - - - 155,000 Construction in progress 138,465 - 138,465 - - Total Capital Assets, not being Depreciated 26,201,405 - 157,465 - 26,043,940 Capital Assets, being Depreciated/Amortized: Buildings and improvements 80,526,167 1,650,957 - - 82,177,124 Office equipment and furniture 5,466,241 390,702 - - 5,856,943 Intangible assets 7,268,052 343,995 - - 7,612,047 Machinery and equipment 26,117,468 1,887,943 1,238,946 - 26,766,465 Infrastructure 171,798,010 8,517,843 - - 180,315,853 Capitalized leases 502,532 - - - 502,532 Total Capital Assets being Depreciated/Amortized 291,678,470 12,791,440 1,238,946 - 303,230,964 Less Accumulated Depreciation/Amortization for: Buildings and improvements 34,618,824 1,719,662 - - 36,338,486 Office equipment and furniture 3,496,339 292,933 - - 3,789,272 Intangible assets 5,955,267 222,150 - - 6,177,417 Machinery and equipment 17,409,051 1,755,925 1,236,722 - 17,928,254 Infrastructure 89,817,891 7,069,608 - - 96,887,499 Capitalized leases 471,269 3,908 - - 475,177 Total Accumulated Depreciation/Amortization 151,768,641 11,064,186 1,236,722 - 161,596,105 Total Capital Assets being Depreciated/Amortized, Net 139,909,829 1,727,254 2,224 - 141,634,859 Governmental Activities Capital Assets, Net 166,111,234$ 1,727,254$ 159,689$ -$ 167,678,799$ - 37 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 5. CAPITAL ASSETS - Continued A. Capital Asset Activity - Continued Beginning Additions Deletions Transfers Ending Business-Type activities: Capital Assets, not being Depreciated: Land 4,644,510$ -$ -$ -$ 4,644,510$ Construction in progress 5,537,601 3,552,081 5,209,070 - 3,880,612 Artwork 359,752 - - - 359,752 Total Capital Assets, not being Depreciated 10,541,863 3,552,081 5,209,070 - 8,884,874 Capital Assets, being Depreciated/Amortized: Land improvements 4,911,144 - - - 4,911,144 Buildings and improvements 77,282,216 619,520 - - 77,901,736 Leasehold improvements 304,052 - - - 304,052 Plant 42,685,862 2,335,288 719,885 (201,134) 44,100,131 Transmission and distribution system 53,473,085 11,441,588 91,190 201,134 65,024,617 Sewer system and underground lines 250,735,084 1,312,134 - - 252,047,218 Intangible assets 1,260,258 - - - 1,260,258 Equipment 2,832,642 82,703 19,512 - 2,895,833 Parking meters 1,859,028 - - - 1,859,028 Total Capital Assets being Depreciated/Amortized 435,343,371 15,791,233 830,587 - 450,304,017 Less Accumulated Depreciation/Amortization for: Land improvements 1,773,245 180,141 - - 1,953,386 Buildings and improvements 24,660,147 2,333,135 - - 26,993,282 Leasehold improvements 282,531 6,674 - - 289,205 Plant 15,857,464 1,228,545 491,960 (42,960) 16,551,089 Transmission and distribution system 7,570,716 692,955 91,190 42,960 8,215,441 Sewer system and underground lines 52,993,597 3,387,865 - - 56,381,462 Intangible assets 421,956 147,412 - - 569,368 Equipment 2,159,532 162,250 1,951 - 2,319,831 Parking meters 811,338 132,390 - - 943,728 Total Accumulated Depreciation/Amortization 106,530,526 8,271,367 585,101 - 114,216,792 Total Capital Assets being Depreciated/Amortized, Net 328,812,845 7,519,866 245,486 - 336,087,225 Governmental Activities Capital Assets, Net 339,354,708$ 11,071,947$ 5,454,556$ -$ 344,972,099$ - 38 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 5. CAPITAL ASSETS - Continued A. Capital Asset Activity - Continued Depreciation expense was charged to functions/programs of the primary government as follows: Governmental Activities: General management and support 524,077$ Public safety 601,877 Public works 6,404,605 Housing and economic development 9,303 Recreation and cultural opportunities 1,899,395 Internal service funds 1,624,929 Total Depreciation Expense - Governmental Activities 11,064,186$ Business-Type Activities: Water 1,973,593$ Sewer 3,461,103 Motor vehicle parking 2,836,672 Total Depreciation Expense - Business-Type Activities 8,271,368$ B.Construction Commitments Capital Improvement Fund 5,209,337$ Water Fund 1,980,028 Sewer Fund 363,646 Total Construction Commitments 7,553,011$ The value of construction contracts signed, where the work has not yet been performed at December 31, 2016 is as follows: - 39 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS A. Interfund Accounts At December 31, 2016, interfund receivables and payables consist of the following: Due Due Funds From To General Fund 3,623,264$ 3,368,372$ Debt Service Fund 1,905 777,080 Water Fund 1,171,215 1,233,657 Sewer Fund 1,456,315 - Solid Waste Fund - 1,454,116 Motor Vehicle Parking System Fund 29,130 663,196 Nonmajor Governmental Funds 3,910,280 2,213,767 Internal Service Funds 445,061 393,047 Total 10,637,170$ 10,103,235$ Due Due Funds From To Library Library Funds General -$ 193,159$ Insurance - 311 Economic Development 484 Water Fund 40 - Motor Vehicle Parking System 16 - Total Library Funds 56 193,954 Library Debt Service General 309,962 Nonmajor Governmental Funds 650,000 Total Library Debt Service 309,962 650,000 Total Library 310,018$ 843,954$ The outstanding balances between funds result mainly from 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. - 40 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS - Continued B. Interfund Advances At December 31, 2016, interfund advances consist of the following: Advances Advances Funds To From Governmental Funds General Fund Motor Vehicle Parking System -$ 476,800$ Emergency Telephone System 108,325 - Howard Ridge Tax Increment District 14,338 - Fire Pension 5,000 - Total General Fund 127,663$ 476,800$ Enterprise Funds Motor Vehicle Parking System General Fund 476,800 - Total Motor Vehicle Parking System 476,800 - Special Revenue Funds Emergency Telephone System - 108,325 Neighborhood Stabilization 39,741 - Total Special Revenue Funds 39,741 108,325 Debt Service Howard Ridge Tax Increment District - 54,079 Total Debt Service Funds - 54,079 Fiduciary Funds Fire Pension - 5,000 Total Fiduciary Funds - 5,000 Grand Total 644,204$ 644,204$ - 41 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS - Continued C. Interfund Transfers At December 31, 2016, transfers in (out) consist of the following: Transfers Transfers Funds In Out Governmental Funds General Fund Emergency Telephone System 129,729$ -$ Neighborhood Stabilization Program 2 13,279 - Washington National TIF Debt Service 350,000 - Howard Hartrey TIF 152,450 - SSD5 91,445 - Capital Improvement Fund 490,000 575,000 Water 3,369,559 - Sewer 330,167 - Motor Vehicle Parking System 900,000 - Solid Waste - 1,055,968 Howard/Ridge TIF 60,000 - Motor Fuel Tax 833,000 - West Evanston TIF 30,000 - General Obligation Debt Service Fund - 2,416,005 Good Neighbor 500,000 - Economic Development 849,996 - Total General Fund 8,099,625 4,046,973 General Obligation Debt Service Fund General 2,416,005 - Insurance 9,262 - Fleet 26,762 - Sewer 251,493 - Economic Development 3,515 - Community Development Block Grant 12,478 - Motor Fuel Tax 4,344 - Special Assessment 260,698 - Home 15,322 - Total General Obligation Debt Service Fund 2,999,879 - Transfers are used to (1)move revenues from the fund with collection authorization to the Debt Service Fund as debt service principal and interest payments become due,(2)move restricted amounts from borrowings to the Debt Service Fund to establish mandatory reserve accounts,(3)move restricted General Fund revenues to finance various programs that the government must account for in other funds in accordance with budgetary authorization,including amounts provided as subsidies or matching funds for various grant programs. - 42 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS - Continued C. Interfund Transfers - Continued Transfers Transfers Funds In Out Nonmajor Governmental Funds Economic Development Howard/Ridge TIF 47,500$ -$ General Obligation Debt Service Fund - 15,322 General - 849,996 Total Economic Development 47,500 865,318 Howard Hartrey TIF General - 152,450 Capital Improvements - 1,589,307 Total Howard Hartrey TIF - 1,741,757 Howard/Ridge TIF Economic Development - 47,500 General - 60,000 Total Howard/Ridge TIF - 107,500 Washington National TIF Debt Service General - 350,000 Capital Improvements - 393,747 Motor Vehicle Parking System - 3,711,768 Total Washington National TIF Debt Service - 4,455,515 West Evanston Tax Increment District General - 30,000 SSD5 General - 91,445 Capital Improvements Good Neighbor Fund 500,000 - Motor Fuel Tax 1,356,000 - Washington National TIF Debt Service 393,748 - Howard Hartrey 1,589,307 - Special Assessment 100,000 - Motor Vehicle Parking System 350,000 - General 575,000 490,000 Total Capital Improvement 4,864,055 490,000 Special Assessment General Obligation Debt Service - 260,698 Capital Improvements - 100,000 Total Special Assessment - 360,698 Neighborhood Stabilization Program 2 General Obligation Debt Service - 4,344 General - 13,279 Total Neighborhood Stabilization Program 2 - 17,623 Emergency Telephone System General Obligation Debt Service - 12,478 General - 129,729 Total Emergency Telephone System - 142,207 - 43 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS - Continued C. Interfund Transfers - Continued Transfers Transfers Funds In Out Nonmajor Governmental Funds - Continued Motor Fuel Tax General -$ 833,000$ Capital Improvements - 1,356,000 Total Motor Fuel Tax - 2,189,000 Community Development Block Grant General Obligation Debt Service - 3,515 Total Community Development Block Grant - 3,515 Good Neighbor Capital Improvements - 500,000 General - 500,000 Total Good Neighbor - 1,000,000 Home Fund General - - Health and Human Services General - - Total Nonmajor Governmental Funds 4,911,555 11,494,578 Total Governmental Funds 16,011,059 15,541,551 Enterprise Funds Water General - 3,369,559 Total Water - 3,369,559 Sewer General - 330,167 General Obligation Debt Service Fund - 251,493 Total Sewer - 581,660 Motor Vehicle Parking System General - 900,000 Capital Improvements - 350,000 Washington National TIF Debt Service 3,711,768 - Total Motor Vehicle Parking System 3,711,768 1,250,000 Solid Waste General 1,055,967 - Total Enterprise Funds 4,767,735 5,201,219 - 44 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 6.INTERFUNDS - Continued C. Interfund Transfers - Continued Transfers Transfers Funds In Out Internal Service Funds Fleet Fund Debt Service Fund -$ 26,762$ Total Fleet Fund - 26,762 Insurance Fund Debt Service Fund - 9,262 Total Insurance Fund - 9,262 Total Internal Service Funds - 36,024 Total Primary Government 20,778,794 20,778,794 Total 20,778,794$ 20,778,794$ Note - Transfers between the primary government and component unit have been reclassified on the statement of activities. - 45 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 7. OPERATING LEASES Number of Monthly Annual Lease Leasing Co.Expiration Machines Payment Payment Type of Machines Mail Finance 4/30/2018 1 375 4,500$ Postage Machine Minimum annual lease payments are as follows: Year ending 12/31/2017 $ 4,500 Year ending 12/31/2018 1,500 Toal 6,000$ The City entered into a lease agreement for a postage machine with Neopost during the 2012 fiscal year.The machine is located on the first floor in the Civic Center. The lease term is 63 months with the first payment due in February 2013. - 46 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8.LONG-TERM DEBT A. Changes in Long-Term Debt Final Interest Maturity Balance Restated/ Balance Due Within Rate Date 12/31/2015 Issued Refunded Payments 12/31/2016 One Year G.O. Debt Governmental Activities Series 2006 3.85%-5.00%12/1/2026 8,840,000$ -$ 8,840,000$ -$ -$ -$ Series 2006B 4.00%-4.25%12/1/2023 1,880,000 - - 1,880,000 - - Series 2007 4.00%-5.00%12/1/2016 10,734,679 - - 1,063,055 9,671,624 882,160 Series 2008A 3.00%-5.00%12/1/2021 2,115,000 - - 305,000 1,810,000 310,000 Series 2008C 3.00%-5.00%12/1/2028 7,352,580 - - 426,120 6,926,460 442,200 Series 2008D 3.25%-5.00%12/1/2016 195,520 - - 195,520 - - Series 2010A 2.00%-3.625%12/1/2029 5,350,000 - - 310,000 5,040,000 320,000 Series 2010B 1.00%-3.30%12/1/2019 3,428,905 - - 772,652 2,656,253 826,947 Series 2011A 2.00%-4.50%12/1/2031 11,100,420 - - 550,432 10,549,988 563,230 Series 2012A (SSA#5)2.00%-3.25%12/1/2032 405,000 - - 405,000 - - Series 2012A 2.00%-3.25%12/1/2032 7,575,000 - - 285,000 7,290,000 660,000 Series 2013A 2.00%-4.75%12/1/2033 10,095,000 - - 455,000 9,640,000 465,000 Series 2013B 2.00%-3.00%12/1/2025 17,861,617 - - 2,538,164 15,323,453 2,589,327 Series 2014 1.25%-5.00%12/1/2034 9,070,000 - - 370,000 8,700,000 375,000 Series 2015A 2.00%-4.00%12/1/2035 7,605,000 - - 265,000 7,340,000 285,000 Series 2015B 2.00%-3.00%12/1/2022 11,075,000 - - 1,000,000 10,075,000 1,750,000 Series 2016A 2.00%-4.00%12/1/2036 - 9,450,000 - - 9,450,000 340,000 Series 2016B 2.00%-3.00%12/1/2026 - 7,635,000 - - 7,635,000 655,000 Subtotal Governmental Activities 114,683,721 17,085,000 8,840,000.00 10,820,943 112,107,778 10,463,864 Bonds premium 3,473,719 987,229 - 477,564 3,983,384 - OPEB liability - City 1,876,719 472,069 - - 2,348,788 - OPEB liability - Internal Service Funds 72,331 9,411 - - 81,742 - Net pension liability - IMRF 3,735,547 10,819,895 - - 14,555,442 - Net pension liability - Police Pension 104,889,631 7,415,176 - - 112,304,807 - Net pension liability - Firefighters' Pension 86,402,164 6,141,403 - - 92,543,567 - Compensated absences payable - City 8,991,381 4,659,735 - 3,506,639 10,144,477 4,057,791 Compensated absences payable - Internal Service Funds 95,635 56,390 - 19,127 132,898 26,580 First Bank loan 3,548,812 1,580,000 - - 5,128,812 5,128,812 Claims payable 4,227,368 1,861,250 - 860,748 5,227,870 2,274,750 Subtotal Other Governmental Activities Liabilities 217,313,307 34,002,558 - 4,864,078 246,451,787 11,487,933 Total Governmental Activities Debt and Liabilities 331,997,028$ 51,087,558$ 8,840,000.00$ 15,685,021$ 358,559,565$ 21,951,797$ G.O. Debt Business-Type Activities Series 2007 Sewer 4.00%-5.00%12/1/2016 460,000$ -$ -$ 225,000$ 235,000$ 235,000$ Series 2007 Parking 4.00%-5.00%12/1/2016 330,000 - - 160,000 170,000 170,000 Series 2008B Sherman Garage 3.00%-5.00%12/1/2018 6,340,000 - - 2,095,000 4,245,000 2,600,000 Series 2008C Sewer 3.00%-5.00%12/1/2028 1,792,420 - - 103,880 1,688,540 107,800 Series 2010B W/S/San/Pkg 1.00%-3.30%12/1/2019 676,094 - - 152,347 523,747 163,053 Series 2011A W/S 2.00%-4.50%12/1/2031 3,404,578 - - 169,569 3,235,009 171,770 Series 2012A 2.00%-3.25%12/1/2032 3,955,000 - - 180,000 3,775,000 185,000 Series 2013A - Water 2.00%-4.75%12/1/2033 1,870,000 - - 80,000 1,790,000 80,000 Series 2013B 2.00%-3.00%12/1/2025 4,009,802 - - 1,225,020 2,784,782 1,249,502 Series 2014 1.25%-5.00%12/1/2034 2,630,000 - - 100,000 2,530,000 100,000 Series 2015A 2.00%-4.00%12/1/2035 5,490,000 - - 180,000 5,310,000 195,000 Series 2016A 2.00%-4.00%12/1/2036 - 3,615,000 - - 3,615,000 120,000 Subtotal Business-Type Activities 30,957,894 3,615,000 - 4,670,816 29,902,078 5,377,125 IEPA loans 2.535%-3.59%Various 51,901,172 620,560 - 7,265,495 45,256,237 6,664,185 Bonds premium 953,714 143,179 - 72,621 1,024,272 - Compensated absences payable - City 927,337 175,644 - 185,468 917,513 183,503 Net pension liability - IMRF 802,243 2,323,672 - - 3,125,915 - OPEB liability 360,738 47,567 - - 408,305 - Subtotal Other Business-Type Activities Liabilities 3,044,032 2,690,062 - 258,089 5,476,005 183,503 Total Business-Type Activities Debt and Liabilities 85,903,098$ 6,925,622$ -$ 12,194,400$ 80,634,320$ 12,224,813$ Total Governmental and Business-Type Activities Debt and Liabilities 417,900,126$ 58,013,180$ 8,840,000.00$ 27,879,421$ 439,193,885$ 34,176,610$ Note:Sewer Fund,Water Fund,Solid Waste Fund,Parking Fund,and General Fund have been used to liquidate IMRF pension liability.General Fund,Fleet Fund,Water Fund, Parking Fund, Solid Waste Fund, and Sewer Fund have been used to liquidate other postemployment benefit obligations. - 47 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8. LONG-TERM DEBT - Continued A. Changes in Long-Term Debt - Continued Business-Type Activities - IEPA Loans IEPA loans payable consist of the following: Date of Final Interest Original Issue Maturity Rates Indebtedness Balance Various Various Various 121,489,100$ 45,256,237$ Total Business-Type Activities - IEPA Loan Debt 45,256,237$ Business-type activities IEPA loans are payable from revenues derived from Sewer and Water service fees.The City has pledged future revenues,net of operating expenses,to repay principal totaling $121,489,100 in IEPA loans issued in 1994 through 2016. Proceeds from the loans provided financing for the Long-Term Sewer and Water Improvement Program. The IEPA loans,payable from operating revenues,are payable through 2036.Annual principal and interest on the loans are expected to require $7,735,647 of net revenues for the fiscal year 2017.The total principal and interest remaining to be paid on the loans is $50,616,046.Principal and interest paid for the current period and total customer net revenues were $8,519,109 and $11,584,142, respectively. - 48 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8. LONG-TERM DEBT - Continued B.General Obligation Bonds Payable Year Ending Governmental Activities Business-Type Activities December 31, Principal Interest Principal Interest 2017 10,463,864$ 3,880,836$ 5,377,126$ 1,109,487$ 2018 9,964,234 3,521,053 4,356,935 869,953 2019 9,779,112 3,235,021 1,219,134 722,268 2020 9,116,738 2,932,974 1,072,483 680,556 2021 9,388,018 2,647,104 1,112,768 641,778 2022-2026 35,995,725 8,846,207 6,215,386 2,536,328 2027-2031 19,338,089 3,299,882 6,898,247 1,289,887 2032-2036 8,065,000 616,188 3,650,000 277,836 Total 112,110,780$ 28,979,265$ 29,902,079$ 8,128,093$ Current Refunding In September 2016,the City issued Series 2016A General Obligation Bonds for a total of $13,715,000 with interest rates ranging from 2.0%to 4.0%.The bonds were issued to provide financing for certain public improvement projects for both governmental and business-type activities. Also in September 2016,the City issued Series 2016B General Obligation Refunding Bonds for a total of $7,635,000 with interest rates ranging from 2.0%to 3.0%.The bonds were issued to currently refund $8,840,000 of the currently outstanding General Obligation Bonds, Series 2006. The following schedule illustrates the annual debt service requirements to maturity for general obligation bonds. On September 28,2016,the City issued $7,635,000 in General Obligation Refunding Bonds,Series 2016B,due in annual installments of $655,000 to $865,000 plus interest at 2%to 3%through December 1,2026 to advance refund a portion of the General Obligation Bonds,Series 2006 in the amount of $8,840,000.The net proceeds of $8,840,000 (after payment of $119,278 in underwriting fees,insurance,and other issuance costs)were used to call the 2006 bonds.This transition resulted in a reduction of total debt service payments decrease in future debt payments of $1,625,279,which results in an economic gain (difference between present value of the debt service payments of the refunded and refunding bonds) of $1,497,647. The City issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. General obligation bonds have been issued for both governmental and business-type activities. General obligation bonds are direct obligations and pledge the full faith and credit of the City.These bonds generally are issued as 20-year serial bonds with equal amounts of principal maturing each year. - 49 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8. LONG-TERM DEBT - Continued C.Notes Payable - IEPA Loans Notes payable - IEPA debt service requirements to maturity are as follows: For the Fiscal Year Ending Principal Interest 2017 6,664,185$ 1,071,462$ 2018 6,226,668 905,468 2019 5,269,650 748,130 2020 4,919,418 619,200 2021 4,424,086 494,597 2022-2026 13,442,053 1,251,852 2027-2031 3,301,118 232,818 2032-2036 1,009,059 36,282 Total 45,256,237$ 5,359,809$ D.Loan with First Bank and Trust, Evanston E.Postemployment Benefits other than Pensions (Defined Benefit Plan) Contribution requirements are established through Illinois State laws.The City and the Library implicitly contributes the difference between retiree's contributions and unblended rates.Retirees pay 100%of the blended premiums to cover themselves and their covered dependents ranging from $493 for single coverage to $1,891 for family coverage.The City pays 100%of health care premiums for police officers and firefighters,their dependents and their surviving spouses and dependent children if they were injured or killed in the line of duty during an emergency,ranging from $493 for single coverage to $1,891 for family coverage.For the year ended December 31,2016,the City and Library's estimated contribution to the plan is $767,139.The City's and the Library's annual other postemployment benefit (OPEB)cost (expense)is calculated based on the annual required contribution of the employer (ARC),an amount actuarially determined in accordance with 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 30 years. The City's and the Library's group health insurance plan provides coverage to active employees and retirees (or other qualified terminated employees)at blended premium rates.This results in an other postemployment benefit (OPEB)for the retirees,commonly referred to as an implicit rate subsidy.The group health insurance plan does not issue a publicly available financial report. During 2016,the City drew $1,580,000 from loan/line of credit with First Bank and Trust,Evanston.The loan term was renewed to mature on June 12,2017.As of December 31,2016,the City had drawn $5,128,812 for capital projects funded out of TIF funds.The interest rate will be calculated based on 1.00 percentage point over one month "LIBOR" rate index. Business-Type Activities As of December 31,2016,the City currently has 23 outstanding loans from the IEPA.The City will repay the loans solely from revenues derived from the sewer and water system;the loans do not constitute a full faith and credit obligation of the City.They will be repaid with equal installments consisting of principal plus simple interest,on unpaid principal balances,over a period of 20 years.Initial principal balances will consist of disbursements and interest accrued during construction. Repayments begin not later than six months after completion of construction. - 50 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8. LONG-TERM DEBT - Continued E.Postemployment Benefits other than Pensions (Defined Benefit Plan) - Continued Membership Retirees and beneficiaries current receiving benefits 87 Terminated employees entitles to benefits but not yet receiving them - Active employees 729 Total 816 City Library Annual required contribution 1,271,450$ 24,890$ Interest on net OPEB obligation 103,940 3,275 Adjustment to annual required contribution (88,205) (2,779) Annual Pension Cost 1,287,185 25,386 Contributions made (758,138) (9,001) Increase (Decrease) in Net Pension Obligation 529,047 16,385 Net OPEB Obligation - Beginning 2,309,788 72,769 Net OPEB Obligation - Ending 2,838,835$ 89,154$ Percentage of Fiscal Period Annual OPEB Annual OPEB Net OPEB Ended Cost Cost Contributed Liability 12/31/2014 1,085,542$ 85.12%2,225,756$ 12/31/2015 1,086,641 92.27%2,309,788 12/31/2016 1,287,185 58.89%2,838,835 The following table shows the components of the City's and the Library's annual OPEB cost for the year ended December 31,2016,the estimated contributions to the plan and changes in the City's and the Library's net OPEB obligation to the retiree health plan. The City's annual OPEB cost,the percentage of annual OPEB cost contributed to the plan,and the net OPEB obligation for 2016 and the two years prior were as follows. At December 31, 2016 (date of last actuarial valuation), membership consisted of: - 51 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 8. LONG-TERM DEBT - Continued E.Postemployment Benefits other than Pensions (Defined Benefit Plan) - Continued Percentage of Fiscal Period Annual OPEB Annual OPEB Net OPEB Ended Cost Cost Contributed Liability 12/31/2014 17,446$ 7.93%56,716$ 12/31/2015 17,555 8.56%72,769 12/31/2016 25,386 35.46%89,154 City Library Actuarial accrued liability (AAL)14,506,212$ 221,722$ Actuarial value of plan assets - - Unfunded Actuarial Accrued Liability (UAAL)14,506,212$ 221,722$ Funded ratio (actuarial value of plan assets/AAL)0.00%0.00% Covered payroll (active plan members)59,573,207$ 2,287,385$ UAAL as a percentage of covered payroll 24.35%9.69% The Library's annual OPEB cost,the percentage of annual OPEB cost contributed to the plan,and the net OPEB obligation for 2016 and the two years prior were as follows. The funded status of the City and the Library plan based on the projected valuation results as of December 31,2016 was as follows: Actuarial valuations of an ongoing plan involve estimates for 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 health care trend.Amounts determined regarding the funded status of the plan and annual required contributions 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,presented as required supplementary information following the notes to the financial statements,presents multi-year trend information that shows whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan is understood by the employer and 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 short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of calculations. In the actuarial valuation as of December 31,2016,the entry-age normal cost method was used.The actuarial assumptions include a 4.5%discount rate and an annual health care cost trend rate of 8.5%initially,reduced by decrements to an ultimate rate of 4.5%.Both rates include a 2.5%price inflation assumption.The actuarial value of retiree health plan assets was determined using techniques that spread the effects of short-term volatility in the market value of investments over a three-year period.Retiree health plan's unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on an open basis. The amortization period at December 31, 2016 was 30 years. - 52 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 9.FUND EQUITY A.Restricted Net Position - Fiduciary Funds Fiduciary Funds Firefighters' Pension Fund restriction for employee pension benefits 70,599,998$ Police Pension Fund restriction for employee pension benefits 106,191,545 Total Fiduciary Funds 176,791,543$ B.Assigned Fund Balances The following are the assigned fund balances: General Fund Assigned for Arts Council 20,948$ Assigned for private elm trees 134,483 Assigned for Dutch elm inoculation 499,973 Assigned for parkway trees 65,371 Assigned for Butterfield sculpture 30,883 Assigned for scholarship contributions 11,607 Assigned for Noyes Center 337,086 Assigned for recreation group activities 207,123 Assigned for youth initiative 42,151 Assigned for parks and recreation 467,468 Assigned for Mayor's programs 93,179 Assigned for IMRF - Pension 1,462,892 Assigned for compensated absences 1,547,027 Other assignments 125,447 Total General Fund 5,045,638 Capital Improvement Fund Assigned for capital projects 10,933,458 Total Assigned Fund Balances 15,979,096$ - 53 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 10.INDIVIDUAL FUND ACTIVITIES A.General Obligation Debt Service Fund B.Water Fund C.Special Service District No. 4 The City usually adopts several resolutions abating portions of the property tax debt service levies.The amount of property taxes abated is derived from principal and interest payments by private assessments on street paving projects; additional water/sewer service fees related to the citywide water/sewer improvement project;tax increment revenues in the Washington National and Howard Hartrey Tax Increment Districts;revenues from the Motor Vehicle Parking System Fund associated with the Maple Garage,Sherman Garage,and Church Street Self-Park Garage;and General Obligation Debt Service Fund interest income. On January 28,1997,the City executed a long-term water supply contract with the Village of Skokie,Illinois,to replace an expiring contract.The contract took effect on March 1,1997 and continues in effect for a period of 20 years until February 28,2017.The contract is renewable at ten-year intervals thereafter.Under the terms of the contract,the City is to supply the Village of Skokie sufficient potable Lake Michigan water to satisfy the maximum 24-hour demand for Lake Michigan water of the Village of Skokie system. The City also provides potable Lake Michigan water to the Northwest Water Commission (NWWC)under a long-term water supply contract.Sale of potable water under this contract began on February 28,1985 and continues until February 28,2030.Under the terms of the current contract,the City is to supply NWWC sufficient potable Lake Michigan water to satisfy NWWC’s maximum 24-hour demands for Lake Michigan water for resale to NWWC’s customers. On August 13,2007,the City Council adopted Ordinance No.37-R-07 which extended the life of Special Service District No.4 until December 31,2019.Special Service District No.4 comprises the central business district of the City.The special district was established for the purpose of providing funds for special maintenance and repair and for promotion and advertisement.The annual property tax levy for 2016 was $329,592 which includes an estimated allowance amount of $6,592. - 54 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 11. RISK MANAGEMENT - CLAIMS AND JUDGMENTS The changes in the balances of claims liabilities during the past two fiscal periods are as follows: Workers’General Compensation Liability Total December 31, 2014 2,176,000$ 2,766,965$ 4,942,965$ New claims and/or estimate revisions 339,385 (390,867) (51,482) Claims payments (588,265) (75,850) (664,115) December 31, 2015 1,927,120 2,300,248 4,227,368 New claims and/or estimate revisions 347,299 2,798,000 3,145,299 Claims payments (29,549) (1,415,248) (1,444,797) December 31, 2016 2,244,870$ 3,683,000$ 5,927,870$ The City records estimated liabilities for workers'compensation and for general claims.Claims liabilities are based on estimates of the ultimate cost of reported claims including future claim adjustment expenses. Workers'compensation and general liability risks are accounted for in the Insurance Fund.The fund was established on March 1,1994 to administer general liability claims and workers'compensation programs on a cost-reimbursement basis.The fund accounts for the aforementioned liabilities of the City, but does not constitute a transfer of risk from the City. The City is exposed to various risks of loss related to torts;theft of,damage to,and destruction of assets;errors and omissions;natural disasters;and injuries to the City's employees.The City maintains commercial all-risk property insurance to cover damage to city facilities and contents and other losses including business interruption and loss of rents.The coverage is subject to a deductible of $50,000 (except $100,000 for flood and earthquake)for each loss and each location.The City also maintains crime and fidelity insurance coverage with a $25,000 deductible to a limit of $2,000,000.In addition,coverage is maintained for ambulance/paramedic liability. For workers'compensation,specific excess coverage in excess of $750,000 per occurrence is purchased from a commercial insurance company. For general liability claims, the City retains risk of loss of $1,250,000 to a limit of $10,000,000. For its health insurance coverages,the City participates through a sub-pool in the Intergovernmental Personnel Benefit Cooperative (IPBC).IPBC is a public entity risk pool established in 1979 by certain units of local government in Illinois to administer some or all of the personnel benefit programs (primarily medical,dental,and life insurance coverage)offered by these members to their officers and employees and to the officers and employees of certain other governmental,quasi governmental,and nonprofit public service entities. Management consists of a Board of Directors comprised of one appointed representative from each member.The officers of IPBC are chosen by the Board of Directors from among their membership.The City does not exercise any control over the activities of IPBC beyond its representation on the Board of Directors of the sub-pool.To obtain IPBC’s financial statements,contact the administrative offices of IPBC at 301 East Irving Park Road, Streamwood, Illinois 60107. - 55 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 12.CONTINGENCIES NOTE 13.JOINT VENTURES A.Solid Waste Agency of Northern Cook County There are various claims and legal actions pending against the City for which provision has been made in the financial statements.At the present time,the City believes that the reserves established are sufficient so that the expected liability for these claims and legal actions will not materially exceed the amounts recorded in the financial statements.Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies, principally the federal government.Any disallowed claims,including amounts already collected,may constitute a liability of the applicable funds.The amount,if any,of the expenditures which may be disallowed by the grantor cannot be determined at this time although the City expects such amounts, if any, to be immaterial. Under the 1992 project use agreement executed by the City with the Agency,the City’s share of project costs,including debt service and disposal,is based on its share of deliveries to the Wheeling Transfer Station for each year.The City does not control the Agency's fiscal management or operations nor is the City legally responsible for any more than its share of the Agency's debt or operating deficits, if any. On March 28,1988,the Evanston City Council authorized agreements providing for the City's participation in the Solid Waste Agency of Northern Cook County (Agency)and in the interim financing of that Agency.The Agency was planned and developed by the Northwest Municipal Conference,of which the City is a member.The agency is empowered to plan, finance, construct, and operate a solid waste disposal system. The Agency is a municipal joint action agency created as of May 2,1988 under the provisions of the Intergovernmental Cooperation Act (the Act),5 ILCS 220/3.2.The Agency consists of 23 municipalities.The Agency is governed by a Board of Directors consisting of one official selected by each member community who serves a two-year term.Each director has one vote.The Board of Directors determines the general policies of the Agency.The Executive Committee of the Agency consists of seven persons elected by the Board of Directors.Each person is entitled to one vote.The Executive Committee may take action not specifically reserved to the Board of Directors by the Act,the Agency agreement,or the by- laws. The authority to designate management,influence operations,and formulate budgets rests with the Board of Directors and Executive Committee.No one member has the ability to significantly influence operations;therefore,the Agency is not a component unit of any other governmental reporting entity. - 56 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 13.JOINT VENTURES - Continued A.Solid Waste Agency of Northern Cook County - Continued Summary of Financial Position as of April 30, 2016: Current assets 2,218,610$ Capital assets, net of depreciation 9,159,887 Total Assets 11,378,497 Current liabilities 2,264,201 Total Liabilities 2,264,201 Deferred inflows of resources Deferred rent 144,000 Net investment in capital assets 9,159,887 Restricted, revenue bonds - Unrestricted deficit (189,591) Net Position 8,970,296$ Summary of Revenues and Expenses for the Year Ended April 30, 2016: Total revenues 12,537,220$ Total expenses (13,151,141) Net Income (613,921)$ Complete financial statements for the Agency can be obtained at 2700 Patriot Blvd., Glenview, IL 60026. B.Evanston Housing Corporation During 2016,the Evanston Housing Corporation ceased operations after a resolution to dissolve the corporation was approved by the members. - 57 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS A.Plan Descriptions Illinois Municipal Retirement Fund Plan Administration Plan Membership Inactive employees or their beneficiaries currently receiving benefits 651 Inactive employees entitled to but not 389 Active employees 512 Total 1,552 Benefits Provided The IMRF Data included in the table above includes membership of both the City and the Library. IMRF provides two tiers of pension benefits.Employees hired prior to January 1,2011 are eligible for Tier 1 benefits. For Tier 1 employees,pension benefits vest after eight years of service.Participating members who retire at age 55 (reduced benefits)or after age 60 (full benefits)with eight years of credited service are entitled to an annual retirement benefit,payable monthly for life,in an amount equal to 1 2/3%of their final rate of earnings,for each year of credited service up to 15 years,and 2%for each year thereafter.Employees hired on or after January 1,2011 are eligible for Tier 2 benefits. For Tier 2 employees, pension benefits vest after ten years of service. Participating members who retire at age 62 (reduced benefits)or after age 67 (full benefits)with ten years of credited service are entitled to an annual retirement benefit,payable monthly for life,in an amount equal to 1 2/3%of their final rate of earnings,for each year of credited service up to 15 years,and 2%for each year thereafter.IMRF also provides death and disability benefits. These benefit provisions and all other requirements are established by state statute. yet receiving benefits At December 31, 2015, IMRF membership consisted of: All employees hired in positions that meet or exceed the prescribed annual hourly standard must be enrolled in IMRF as participating members. The City contributes to the Illinois Municipal Retirement Fund (IMRF),a defined benefit agent multiple-employer public employee retirement system that acts as a common investment and administrative agent for local governments and school districts in Illinois (other than those covered by the Police or Firefighters'Pension Plan).The Illinois Pension Code establishes the benefit provisions of the plan that can only be amended by the Illinois General Assembly.IMRF issues a publicly available financial report that includes financial statements and supplementary information for the plan as a whole,but not by individual employer.That report may be obtained by writing to the Illinois Municipal Retirement Fund, 2211 York Road, Suite 500, Oak Brook, Illinois 60523. The plan is accounted for on the economic resources measurement focus and the accrual basis of accounting. Employer and employee contributions are recognized when earned in the year that the contributions are required, benefits and refunds are recognized as an expense and liability when due and payable. - 58 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A.Plan Descriptions - Continued Illinois Municipal Retirement Fund - Continued Contributions Actuarial Assumptions Actuarial valuation date December 31, 2015 Actuarial cost method Entry-age normal Assumptions Inflation 2.75% Salary increases 3.75% to 14.50% Interest rate 7.50% Cost of living adjustments 3.00% Asset valuation method Market value The City’s net pension liability was measured as of December 31,2015 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation performed as of the same date using the following actuarial methods and assumptions. For nondisabled retirees,an IMRF specific mortality table was used with fully generational projection scale MP-2014 (base year 2014).IMRF specific rates were developed from the RP-2014 Blue Collar Health Annuitant Mortality Table with adjustments to match current IMRF experience.For disabled retirees,an IMRF specific mortality table was used with fully generational projection scale MP-2014 (base year 2014).IMRF specific rates were developed from the RP-2014 Disabled Retirees Mortality Table applying the same adjustment that were applied for nondisabled lives.For active members,an IMRF specific mortality table was used with fully generational projection scale MP-2014 (base year 2014).IMRF specific rates were developed from the RP-2014 Employee Mortality Table with adjustments to match current IMRF experience. Employees participating in IMRF are required to contribute 4.50%of their annual covered salary to IMRF.The member rate is established by state statute.The City is required to contribute the remaining amounts necessary to fund IMRF as specified by statue.The employer contribution rate for the calendar year ended December 31,2015 was 10.66% of covered payroll. Changes in assumptions related to retirement age and mortality were made since the prior measurement date. - 59 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A.Plan Descriptions - Continued Illinois Municipal Retirement Fund - Continued Discount Rate Changes in Net Pension Liability (a)(b)(a) - (b) Total Pension Plan Fiduciary Net Pension Liability Net Position Liability Balances at January 1, 2015 220,476,485$ 215,541,904$ 4,934,581$ Changes for the period Service cost 3,910,996 - 3,910,996 Interest 16,235,086 - 16,235,086 Difference between expected and actual experience 1,465,442 - 1,465,442 Changes in assumptions 266,906 - 266,906 Employer contributions - 4,018,268 (4,018,268) Employee contributions - 1,767,523 (1,767,523) Net investment income - 1,062,353 (1,062,353) Benefit payments and refunds (11,928,345) (11,928,345) - Administrative expense - - - Other (net transfer)- 737,427 (737,427) Net Changes 9,950,085 (4,342,774) 14,292,859 Balances at December 31, 2015 230,426,570$ 211,199,130$ 19,227,440$ The discount rate used to measure the total pension liability was 7.49%.The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that the City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate.Based on those assumptions,the City’s fiduciary net position was projected not to be available to make all projected future benefit payments of current plan members.Therefore,the long-term expected rate of return on pension plan investments of 7.50%was blended with the index rate of 3.57%for tax exempt general obligation municipal bonds rated AA or better at December 31,2015 to arrive at a discount rate of 7.49%used to determine the total pension liability. The table presented above includes amounts for both the City and the Library.The City’s proportionate share of the net pension liability at January 1,2015,the employer contributions,and the net pension liability at December 31, 2015 was $4,537,790,$3,688,783,and $17,681,357,respectively.The Library’s proportionate share of the net pension liability at January 1,2015,the employer contributions and the net pension liability at December 31,2015 was $396,791, $329,485, and $1,546,083, respectively. - 60 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A.Plan Descriptions - Continued Illinois Municipal Retirement Fund - Continued Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Deferred Deferred Outflows of Inflows of Resources Resources Difference between expected and actual experience 2,222,568$ -$ Changes in assumption 3,435,063 - Net difference between projected and actual earnings on pension plan investments 12,583,562 - Employer contributions after the measurement date 3,720,003 Total 21,961,196$ -$ Year Ending December 31, 2016 7,085,134$ 2017 5,921,087 2018 3,849,669 2019 2,980,119 Thereafter - Total 19,836,009$ For the year ended December 31,2015,the City recognized pension expense of $5,543,149.At December 31,2015, the City reported deferred outflows of resources and deferred inflows of resources related to IMRF from the following sources: The deferred outflows presented in the table above include amounts for both the City and the Library.The City’s proportionate share of the deferred outflows and inflows of resources at December 31,2015 was $21,961,196.The Library’s proportionate share of the deferred outflows of resources at December 31, 2015 was $1,920,319. Amounts reported as deferred outflows of resources and deferred inflows of resources related to IMRF will be recognized in pension expense as follows: - 61 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A.Plan Descriptions - Continued Illinois Municipal Retirement Fund - Continued Discount Rate Sensitivity Current 1% Decrease Discount Rate 1% Increase (6.49%)(7.49%)(8.49%) City 44,213,500$ 17,681,357$ (4,178,950)$ Library 3,865,556 1,546,083 (365,363) Total 48,079,056$ 19,227,440$ (4,544,313)$ The following is a sensitivity analysis of the net pension liability (asset)to changes in the discount rate.The table below presents the net pension liability (asset)of the City calculated using the discount rate of 7.49%as well as what the City’s net pension liability (asset)would be if it were calculated using a discount rate that is 1 percentage point lower (6.49%) or 1 percentage point higher (8.49%) than the current rate: - 62 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans Plan Administration Plan Membership At January 1, 2016, plan membership consisted of: Firefighters' Police Pension Pension Inactive plan members or beneficiaries currently receiving benefits 179 142 Inactive plan members entitled to but not yet receiving benefits 16 4 Active plan members 158 105 Total 353 251 Benefits Provided The Police Pension Plan and Firefighters'Pension Plan are contributory,defined benefit public employee retirement plans administered by the City and a Board of Trustees for each fund.All sworn City police officers and firefighters are participants in the plans.The plans do not issue stand-alone financial reports and they are not included in the report of a public employee retirement system or another entity.The City accounts for the Police Pension and Firefighters'Pension Plans as pension trust funds. The plans are governed by a five-member pension board.Two members appointed by the City's Council,one elected by retired pension members, and two elected by active members, constitute the pension board. The Police and Firefighters'Pension Plans are accounted for on the economic resources measurement focus and the accrual basis of accounting.Employer and employee contributions are recognized when earned in the year that the contributions are required, benefits and refunds are recognized on an expense and liability when due and payable. For employer contributions,the City’s budget policy is to fund pension plans at the funding level recommended annually by the actuary. The General Fund is used to liquidate the net pension liability. As provided for in the Illinois Compiled Statutes,the Police and Firefighters'Pension Funds provide retirement benefits as well as death and disability benefits to employees grouped into two tiers.Tier 1 is for employees hired prior to January 1, 2011 and Tier 2 is for employees hired after that date.The following is a summary of the Police and Firefighters'Pension Funds as provided for in Illinois Compiled Statutes. - 63 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS – Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Benefits Provided - Continued Police Pension Plan Firefighters' Pension Plan Tier 2 ‑Covered employees attaining the age of 55 or more with 10 or more years of creditable service are entitled to receive a monthly pension of 2.5%of the final average salary for each year of creditable service.The salary is initially capped at $106,800 but increases annually thereafter and is limited to 75%of final average salary.Employees with 10 or more years of creditable service may retire at or after age 50 and receive a reduced retirement benefit.The monthly pension of a police officer shall be increased annually on the January 1 occurring either on or after the attainment of age 60 or the first anniversary of the pension start date,whichever is later.Each annual increase shall be calculated at 3%or one-half the annual unadjusted percentage increase in the consumer price index (CPI), whichever is less. Tier 1 -Covered employees attaining the age of 50 or more with 20 or more years of creditable service are entitled to receive a monthly retirement benefit of one-half of the monthly salary attached to the rank held in the fire service at the date of retirement.The monthly pension shall be increased by one-twelfth of 2.5%of such monthly salary for each additional month over 20 years of service through 30 years of service to a maximum of 75%of such monthly salary.Employees with at least 10 years but less than 20 years of credited service may retire at or after age 60 and receive a reduced retirement benefit.The monthly pension of a firefighter who retired with 20 or more years of service after January 1,1977 shall be increased annually,following the first anniversary date of retirement and paid upon reaching at least the age 55,by 3%of the original pension and 3% compounded annually thereafter. Tier 2 ‑Covered employees attaining the age of 55 or more with 10 or more years of creditable service are entitled to receive a monthly pension of 2.5%of the final average salary for each year of creditable service.The salary is initially capped at $106,800 but increases annually thereafter and is limited to 75%of final average salary.Employees with 10 or more years of creditable service may retire at or after age 50 and receive a reduced retirement benefit.The monthly pension of a firefighter shall be increased annually on the January 1 occurring either on or after the attainment of age 60 or the first anniversary of the pension start date,whichever is later.Each annual increase shall be calculated at 3%or one-half the annual unadjusted percentage increase in the CPI, whichever is less. Tier 1 ‑Covered employees attaining the age of 50 or more with 20 or more years of creditable service are entitled to receive an annual retirement benefit of one half of the salary attached to the rank on the last day of service,or for one year prior to the last day,whichever is greater.The pension shall be increased by 2.5%of such salary for each additional year of service over 20 years up to 30 years to a maximum of 75%of such salary.Employees with at least 8 years but less than 20 years of credited service may retire at or after age 60 and receive a reduced retirement benefit.The monthly pension of a police officer who retired with 20 or more years of service after January 1,1977 shall be increased annually,following the first anniversary date of retirement and paid upon reaching at least age 55,by 3%of the original pension and 3% compounded annually thereafter. - 64 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Contributions Investment Policy Police Pension Fund Police Pension Asset Class Domestic Equity Large Cap 4.75% Domestic Small Cap 5.00% International Developed Foreign 5.50% Fixed Income 1.50% REITS 3.75% Cash 0.00% Total 5.00% 32.00% 3.00% 3.00% 100.00% 5.00% Covered employees are required to contribute 9.91%of their base salary to the Police Pension Plan.If an employee leaves covered employment with less than 20 years of service,accumulated employee contributions may be refunded without accumulated interest.The City is required to contribute the remaining amounts necessary to finance the plans as actuarially determined by an enrolled actuary.Effective January 1,2011,the City's contributions must accumulate to the point where the past service cost for the Police Pension Plan is 90%funded by the year 2040.For the year ended December 31,2016, the City's contribution was 54.08% of covered payroll. Participants contribute a fixed percentage of their base salary to the Firefighters'Pension Plan.At December 31,2016,the contribution percentage was 9.455%.If a participant leaves covered employment with less than 20 years of service, accumulated participant contributions may be refunded without accumulated interest.The City is required to contribute the remaining amounts necessary to finance the plan as actuarially determined by an enrolled actuary.Effective January 1, 2011,the City’s contributions must accumulate to the point where the past service cost for the Firefighters'Pension Plan is 90%funded by the year 2040.For the year ended December 31,2016,the City’s contribution was 70.13%of covered payroll. Permitted Deposits and Investments -Statutes and the Police Pension Fund’s (the Fund)investment policy authorize the Fund to make deposits/invest in insured commercial banks,savings and loan institutions,obligations of the U.S.Treasury and U.S.agencies,insured credit union shares,money market mutual funds with portfolios of securities issued or guaranteed by the United States Government or agreements to repurchase these same obligations,repurchase agreements, short-term commercial paper rated within the three highest classifications by at least two standard rating services,Illinois Funds,IMET,certain non-U.S.obligations,Illinois municipal corporations tax anticipation warrants,veteran’s loans, obligations of the State of Illinois and its political subdivisions,and Illinois insurance company general and separate accounts,mutual funds and equity securities (not to exceed 65%of the total net position of the Fund),and corporate bonds. During the year, no changes to the investment policy were approved by the Board of Trustees. The Fund's investment policy allows investments in all of the above listed accounts,but does exclude any repurchase agreements.The Fund's investment policy,in accordance with Illinois Statutes,establishes the following target allocation across asset classes: Long-Term Expected Target Allocation Real Rate of Return 52.00% - 65 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Investment Policy - Continued Police Pension Fund - Continued Firefighters' Pension Fund Firefighters' Pension Asset Class Target Allocation Cash 1.30%1.00% U.S. Fixed Income 39.20%2.70% High Yield 1.60%6.50% U.S. Large Cap Growth Equity 12.60%8.00% U.S. Large Cap Value Equity 16.50%7.70% U.S. Mid Cap Growth Equity 3.20%9.00% U.S. Mid Cap Value Equity 3.20%8.30% U.S. Small Cap Growth Equity 2.60%9.90% U.S. Small Cap Value Equity 2.60%9.00% Europe Equity 5.10%7.50% Japan Equity 0.90%7.40% Emerging Market Equity 0.50%9.50% Real Estate 2.60%7.00% Infrastructure 3.30%6.20% Equity Hedge Assets 1.80%3.40% Equity Return Assets 3.00%4.70% Total 100.00% The long-term expected rate of return on the Fund's investments 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 expenses,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.Best estimates of arithmetic real rates of return for each major asset class included in the Fund's target asset allocation as of December 31, 2016 are listed in the table above. The Firefighters'Pension Fund (the Fund)allows funds to be invested in any type of security authorized by the Illinois Pension Code.During the year,no changes to the investment policy were approved by the Board of Trustees.The Fund's investment policy, in accordance with Illinois Statutes, establishes the following target allocation across asset classes: Long-Term Expected Real Rate of Return The long-term expected rate of return on the Fund's investments 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 expenses,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.Best estimates of arithmetic real rates of return for each major asset class included in the Fund's target asset allocation as of December 31, 2016 are listed in the table above. - 66 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Investment Valuations Investment Rate of Return Deposits with Financial Institutions Interest Rate Risk Fair Value Less Than 1 Year 1 - 5 Years 6 - 10 Years Greater than 10 Years Corporate bonds 27,079,664$ 1,770,001$ 14,870,376$ 9,232,411$ 1,206,876$ U.S. Treasuries 13,765,989 1,084,897 2,823,503 1,927,024 7,930,565 Federal Home Loan Bank 1,867,487 670,840 1,185,069 11,578 - Federal Home Loan Mortgage Corp 4,516,294 112,637 731,327 1,948,116 1,724,214 Fannie Mae 7,397,353 118,553 1,457,406 2,283,310 3,538,084 Ginnie Mae 189,324 - 5,921 36,832 146,571 Total Police and Firefighters' Investment $ 54,816,111 $ 3,756,928 $ 21,073,602 $ 15,439,271 $ 14,546,310 Custodial credit risk for deposits with financial institutions is the risk that in the event of a bank’s failure,the Funds' deposits may not be returned to them.The Funds'investment policies do not require pledging of collateral for all bank balances in excess of federal depository insurance,since flow-through FDIC insurance is available for the Funds'deposits with financial institutions. The following table presents the investments and maturities of the Funds' debt securities as of December 31, 2016: Police and Firefighters' Pension Investment Type In accordance with its investment policy,the Funds'limit exposure to interest rate risk by structuring the portfolio to provide liquidity for operating funds not needed within a one-year period.The investment policies does not limit the maximum maturity length of investments in the Funds. Investment Maturities (In Years) For the year ended December 31,2016,the Police Pension Plan annual money-weighted rate of return on pension plan investment,net of pension plan investment expense,was 6.90%.The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. All investments in the Police and Firefighters'Pension Plans are stated at fair value and are recorded as of the trade date. Fair value is based on quoted market prices at December 31 for debt securities,equity securities and mutual funds,and contract values for any insurance contracts.Investment income is recognized as earned.Gains and losses on sales and exchanges of fixed income securities are recognized on the transaction date. For the year ended December 31,2016,the Firefighters'Pension Plan annual money weighted rate of return on pension plan investment,net of pension plan investment expense,was 5.90%.The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. - 67 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Interest Rate Risk (Continued) Credit Risk Custodial Credit Risk - Investments The Police and Firefighters'Pension Funds catergorize the fair value measurements within the fair value hierarchy established by generally accepted accounting principles.The hierarchy is based on the valuation inputs used to measure the fair value of the asset.Level 1 inputs are quoted prices in active markets for identical assets;Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant unobservable inputs. The City's Police Pension Fund has the following recurring fair value measurements as of December 31,2016.The U.S. Treasury Obligations,Domestic and International Equity securities are valued using quoted market prices (Level 1 inputs). Corporate bonds, municipal bonds, and U.S. agency obligations are valued using matrix pricing models (Level 2 inputs). The City's Firefighters'Pension Fund has the following recurring fair value measurements as of December 31,2016.The U.S.Treasury Obligations,Domestic and International Equity securities are valued using quoted market prices (Level 1 inputs).Corporate bonds,municipal bonds,and U.S.agency obligations are valued using matrix pricing models (Level 2 inputs). The Funds'limits its exposure to credit risk,the risk that the issuer of a debt security will not pay its par value upon maturity,by investing in obligations guaranteed by the United States Government or securities issued by agencies of the United States Government that are explicitly or implicitly guaranteed by the United States Government bonds and investment grade bonds.The U.S.Treasury and agency obligations are rated by Moody’s Aaa,the corporate bonds are rated between Baa3 and Aaa,and the municipal bonds are rated between Aa3 and Aaa.Illinois Funds is rated Aaa by Standard and Poor’s. Custodial credit risk for investments is the risk that,in the event of the failure of the counterparty to the investment,the Funds will not be able to recover the value of their investments that are in possession of an outside party.To limit its exposure,the Funds'investment policies require all security transactions that are exposed to custodial credit risk to be processed on a delivery versus payment (DVP)basis with the underlying investments held by a third party acting as the Funds'agent separate from where the investment was purchased in the Funds'name.Illinois Funds and IMET are not subject to custodial credit risk. Concentration of Credit Risk -Illinois Compiled Statutes (ILCS)limits the Funds'investments in equities,mutual funds, and variable annuities to 65%.Securities in any one company should not exceed 5%of the total fund.The blended asset class is comprised of all other asset classes to allow for rebalancing the portfolio. The Police Pension Trust Fund had no significant investments (other than U.S.Treasuries and corporate bonds)in any one organization that represented 5%or more of net position available for benefits.The only exception to the aforementioned are investments in Federal Home Loan Mortgage Corp. (7.4%). The Firefighters'Pension Trust Fund had no significant investments (other than corporate bonds)in any one organization that represented 5% or more of net position available for benefits. - 68 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Actuarial Assumptions Actuarial valuation date Actuarial cost method Asset valuation method Actuarial assumptions: Projected salary increases graded by age Inflation Interest rate Cost-of-living adjustments Discount Rate 6.50%6.50% From 3.00% to 1.25%From 3.00% to 1.25% Mortality rates were based on the RP-2000 Combined Healthy Mortality table with a Blue Collar Adjustment;disabled mortality rate is based on RP-2000 Disabled Retiree Mortality table. The discount rate used to measure the total police pension liability was 6.50%.The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that the City contribution will be made at rates equal to the difference between actuarially determined contribution rates and the member rate.Based on those assumptions,the police pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. The discount rate used to measure the total firefighters'pension liability was 6.50%.The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that the City contribution will be made at rates equal to the difference between actuarially determined contribution rates and the member rate.Based on those assumptions,the firefighter pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. 2.50%2.50% December 31, 2016 December 31, 2016 Entry-age normal Entry-age normal From 7.69% to 3.62%From 7.36% to 3.62% Market value Market value Police Pension Firefighters' Pension The total pension liability above was determined by an actuarial valuation performed using the following actuarial methods and assumptions. - 69 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Discount Rate (Continued) Current Discount 1% Decrease Rate 1% Increase Police Pension Fund: Discount rate 5.50%6.50%7.50% Net pension liability $ 142,019,936 $ 112,304,807 $ 87,933,861 Firefighters’ Pension Fund: Discount rate 5.50%6.50%7.50% Net pension liability $ 114,406,313 $ 92,543,567 $ 74,593,645 Total Net Pension Liability $ 256,426,249 $ 204,848,374 $ 162,527,506 Changes in the Net Pension Liability Police Pension Fund (a)(b)(a) - (b) Total Pension Plan Fiduciary Net Pension Liability Net Position Liability Balances at January 1, 2016 204,770,550$ 98,558,837$ 106,211,713$ Changes for the period Service cost 3,679,212 - 3,679,212 Interest 13,192,680 - 13,192,680 Difference between expected and actual experience (3,214,201) - (3,214,201) Changes in assumptions 11,039,027 - 11,039,027 Employer contributions - 9,450,824 (9,450,824) Employee contributions - 1,731,740 (1,731,740) Net investment income - 7,544,856 (7,544,856) Benefit payments and refunds (10,970,916) (10,970,916) - Administrative expense - (123,796) 123,796.00 Other (net transfer)- - - Net Changes 13,725,802 7,632,708 6,093,094 Balances at December 31, 2016 218,496,352$ 106,191,545$ 112,304,807$ - 70 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Changes in the Net Pension Liability - Continued Firefighters' Pension Fund (a)(b)(a) - (b) Total Pension Plan Fiduciary Net Pension Liability Net Position Liability Balances at January 1, 2016 154,100,886$ 66,741,084$ 87,359,802$ Changes for the period Service cost 2,731,257 - 2,731,257 Interest 9,922,911 - 9,922,911 Difference between expected and actual experience (3,239,221) - (3,239,221) Changes in assumptions 7,971,672 - 7,971,672 Employer contributions - 7,396,641 (7,396,641) Employee contributions - 997,198 (997,198) Net investment income - 3,894,765 (3,894,765) Benefit payments and refunds (8,343,940) (8,343,940) - Administrative expense - (85,750) 85,750 Other (net transfer)- - - Net Changes 9,042,679 3,858,914 5,183,765 Balances at December 31, 2016 163,143,565$ 70,599,998$ 92,543,567$ Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Police Pension Fund Deferred Deferred Outflows of Inflows of Resources Resources Difference between expected and actual experience 3,273,733 - Changes in assumption 4,826,160 - Net difference between projected and actual earnings on pension plan investments 5,032,113 1,524,126 Total 13,132,006$ 1,524,126$ For the year ended December 31,2016,the City recognized police pension expense of $5,258,120.At December 31,2016, the City reported deferred outflows of resources and deferred inflows of resources related to the Fund from the following sources: - 71 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources - Continued Police Pension Fund - Continued Year Ending December 31, 2017 2,369,965$ 2018 2,369,964 2019 2,369,965 2020 2,878,007 2021 1,619,979 Thereafter - Total 11,607,880$ Firefighters' Pension Fund Deferred Deferred Outflows of Inflows of Resources Resources Difference between expected and actual experience 987,175 - Changes in assumption 3,532,726 - Net difference between projected and actual earnings on pension plan investments 3,978,941 - Total 8,498,842$ -$ Amounts reported as deferred outflows of resources and deferred inflows of resources related to the Police Pension Plan will be recognized in pension expense as follows: For the year ended December 31,2016,the City recognized firefighters'pension expense of $5,039,202.At December 31, 2016,the City reported deferred outflows of resources and deferred inflows of resources related to the Fund from the following sources: - 72 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 14.EMPLOYEE RETIREMENT SYSTEMS - Continued A. Plan Descriptions - Continued Police and Firefighters' Pension Plans - Continued Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources - Continued Firefighters' Pension Fund - Continued Year Ending December 31, 2017 1,940,158$ 2018 1,940,157 2019 1,940,157 2020 1,774,390 2021 903,980 Thereafter - Total 8,498,842$ Amounts reported as deferred outflows of resources and deferred inflows of resources related to the Firefighters'Pension Plan will be recognized in pension expense as follows: - 73 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 15.PENSION TRUST FUNDS Fiduciary Funds Summary Financial Information The following is summary financial information for the Police Pension Plan and the Firefighters' Pension Plan: A. Schedule of Net Position Firefighters'Police Pension Pension Total Assets Cash and cash equivalents 1,917,349$ 3,566,259$ 5,483,608$ Investments at fair value U.S. Treasury obligations 1,776,772 11,989,217 13,765,989 U.S. agency obligations 2,833,757 11,136,701 13,970,458 Corporate bonds 13,964,559 13,115,105 27,079,664 Common stock 5,463,352 25,504,213 30,967,565 Equity mutual funds 44,504,544 40,515,163 85,019,707 Receivables Accrued interest 149,246 300,451 449,697 Due from other governments 18,038 42,719 60,757 Other 5,138 50,138 55,276 Total Assets 70,632,755 106,219,966 176,852,721 Liabilities Accounts payable 32,757 28,421 61,178 Total Liabilities 32,757 28,421 61,178 Net Position Held in Trust For Pension Benefits 70,599,998$ 106,191,545$ 176,791,543$ - 74 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 15.PENSION TRUST FUNDS - Continued Fiduciary Funds Summary Financial Information - Continued B. Changes in Plan Net Position Firefighters'Police Pension Pension Total Additions Contributions Employer 7,396,641$ 9,437,323$ 16,833,964$ Plan members 997,198 1,731,740 2,728,938 Miscellaneous income - 13,501 13,501 Total Contributions 8,393,839 11,182,564 19,576,403 Investment income Net appreciation in fair value of investments 2,509,144 5,104,302 7,613,446 Interest on investments 1,559,737 2,713,348 4,273,085 Less investment expenses (174,111) (272,795) (446,906) Total Investment Income 3,894,770 7,544,855 11,439,625 Total Additions 12,288,609 18,727,419 31,016,028 Deductions Administrative 85,755 123,795 209,550 Benefits payments 8,339,703 10,924,291 19,263,994 Refunds of contributions 4,237 46,625 50,862 Total Deductions 8,429,695 11,094,711 19,524,406 Net Increase 3,858,914 7,632,708 11,491,622 Net Position Held in Trust For Pension Benefits Januay 1 66,741,084 98,558,837 165,299,921 December 31 70,599,998$ 106,191,545$ 176,791,543$ - 75 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 16.EVANSTON LIBRARY COMPONENT UNIT A.Types of Accounts and Securities Custodial Credit Risk.For a deposit,custodial credit risk is the risk that,in the event of the failure of the counterparty,the Library will not be able to recover the value of its deposit or collateral securities that are in the possession of an outside party. At December 31, 2016, all of the Library's deposits were insured or collateralized. Illinois Statutes authorize the Library to invest in obligations of the U.S.Treasury,in Government Sponsored Enterprises (GSE)such as Federal Home Loan Mortgage Corporation (FHLMC),Federal Home Loan Bank (FHLB), and Fannie Mae (FNMA);bankers acceptances as well as commercial paper rated only in the highest tier;repurchase agreements of the highest grade;collateralized certificates of deposit issued by FDIC insured financial institutions, money market mutual funds with portfolios limited to securities guaranteed by the United States Government,IMET, and Illinois Funds. Library investments consists of equities,ETFs,money market funds,mutual funds,corporate bonds,and U.S. Treasuries.Investments are reported at fair value,except that non-negotiable certificate of deposits are stated at cost. The Library has a formal investment policy adopted by its governing board to handle endowment funds.The funds will be invested and administered by a three-member committee.It is the general policy of the Library to invest its funds in a manner which will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the Library and conforming to all state and local statutes governing the investment of public funds using "prudent person"standard for managing the overall portfolio.It may be noted though that the Library has investments in equities which is not permissible under the state statutes. Interest Rate Risk is the risk that changes in interest rates will adversely affect the fair value of an investment.The exposure to interest rate risk can be limited by structuring the portfolio to provide liquidity for cash requirements for ongoing operations in shorter term securities. Credit Risk is the risk that the issuer of the debt security will not pay its par value upon maturity.The Library's investment policy has several guidelines to minimize the potential losses on individual investment by diversifying the investment portfolio,not permitting the investment in certain high risk securities.State law limits investments in commercial paper,corporate bonds,and mutual bonds funds to the top two ratings issued by nationally recognized statistical rating organizations.Illinois Funds and IMET are an investment pools managed by the State of Illinois, Office of the Treasurer,and a Board of Trustees,which allows governments within the State to pool their funds for investment purposes.They are not registered with the SEC as an investment company,but do operate in a manner consistent with Rule 2a7 of the Investment Company Act of 1940.The investments in the securities of the United States Government agencies were all rated AAA or Aaa by the Standard &Poor’s and by Moody’s Investor’s Services.The investments in Illinois Funds and IMET are valued at the fund’s share price,the price for which the investments could be sold. Custodial Credit Risk.For an investment,custodial credit risk is the risk that,in the event of the failure of the counterparty,the Library will not be able to recover the value of its investment or collateral securities that are in the possession of an outside party. Illinois Funds are not subject to custodial credit risk. Concentration of Credit Risk is the risk that the Library has a high percentage of its investments invested in one type of investments.Currently,the Library has diversified its investments in various types of investments.The Library investment policy provides the high/low limits for various type of investments like equity,fixed income securities, and cash. - 76 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 16.EVANSTON LIBRARY COMPONENT UNIT - Continued B.Reconciliation of Cash and Investments Cash and Equivalents 1,379,044$ Investments 3,811,792 Total per Statement of Position $ 5,190,836 Cash in bank 1,379,044$ Vanguard Money Market 319,574 Vanguard Equity Mutual Funds 3,492,218 Total Cash and Investments $ 5,190,836 C.Summary of Receivables Receivables: Property taxes 6,630,313$ D.Capital Assets Activity Beginning Additions Deletions Ending Capital Assets, not being Depreciated: Land 311,380$ -$ -$ 311,380$ Capital Assets, being Depreciated/Amortized: Buildings and improvements 18,800,168 194,063 - 18,994,231 Office equipment and furniture 2,285,009 - - 2,285,009 Infrastructure 230,006 - - 230,006 Library collections 9,061,359 - (451,218) 8,610,141 Capitalized leases 266,191 - - 266,191 Total capital assets being depreciated/amortized 30,642,733 194,063 (451,218) 30,385,578 Less Accumulated Depreciation/Amortization for: Buildings and improvements 7,715,345 393,554 - 8,108,899 Office equipment and furniture 2,285,009 - - 2,285,009 Infrastructure 95,961 14,757 - 110,718 Library collections 7,768,992 272,970 (451,218) 7,590,744 Capitalized leases 266,190 - - 266,190 Total Accumulated Depreciation/Amortization 18,131,497 681,281 (451,218) 18,361,560 Total Capital Assets being Depreciated/Amortized, Net 12,511,236 (487,218) - 12,024,018 Library Activities Capital Assets, Net 12,822,616$ (487,218) - 12,335,398 - 77 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 16. EVANSTON LIBRARY COMPONENT UNIT - Continued E.Long-Term Debt Final Interest Maturity Balance Balance Due Within Rate Date 12/31/2015 Issued Payments 12/31/2016 One Year General Obligations Debt Series 2007 4.00%-5.00%12/1/2027 1,010,321$ -$ 126,945$ 883,376$ 112,840$ Series 2008D 3.25%-5.00%12/1/2016 39,480 - 39,480 - - Series 2013B 2.00%-3.00%12/1/2025 593,580 - 156,816 436,764 161,171 Series 2016A 2.00%-4.00%12/1/2036 - 650,000 - 650,000 20,000 1,643,381 650,000 323,241 1,970,140 294,011 OPEB liability 72,769 16,385 - 89,154 - Compensated absences payable - City 348,806 65,906 - 414,712 165,888 IMRF pension contributions 396,791 1,149,292 - 1,546,083 - Total Long-Term Debt 2,461,747$ 1,881,583$ 323,241$ 4,020,089$ 459,899$ Year Ending December 31, Principal Interest 2017 294,011$ 73,277$ 2018 191,831 60,663 2019 131,755 53,832 2020 115,778 49,073 2021 119,215 44,804 2022-2026 653,890 150,506 2027-2031 263,660 42,746 2032-2036 200,000 16,150 Total 1,970,140$ 491,051$ The following schedule illustrates the annual debt service requirements to maturity for Library General Obligation Bonds. - 78 - CITY OF EVANSTON, ILLINOIS Notes to the Financial Statements For the Fiscal Year Ended December 31, 2016 NOTE 17.PRIOR PERIOD ADJUSTMENT Governmental Business-Type Enterprise Activities Activities Funds Fund Balances (Deficit)/Net Position, January 1 (as Previously Reported)(71,644,744)$ 278,406,893$ 278,406,893$ Change in Accounting Principle 10,819,895 2,323,671 2,323,671 Change in Accounting Principle (4,125,930) (886,082) (886,082) Change in Accounting Principle (41,092,293) - - Fund Balances (Deficit)/Net Position January 1, Restated $ (106,043,072) $ 279,844,482 $ 279,844,482 With the implementation of GASB Statement No.68,the City is required to retroactively record the net pension liability and write off the net pension obligation.The City recorded the following changes in accounting principle during the year ended December The City has restated fund balances/net position as of January 1, 2016 as follows: With the implementation of GASB Statement No.71,the City is required to retroactively record a deferred outflow of resources for contributions subsequent to the measurement date for the Police and Fire Pension Funds.The City recorded the following changes in accounting principle during the year ended December 31, 2016: With the restatement of the Police and Firefighters'Pension Fund Net Pension Liability to the balance per the actuarial valuation dated December 31,2016,the City is required to adjust the beginning balance of the Net Pension liability to the balance at December 31, 2015, and remove deferred outflows related to the - 79 - REQUIRED SUPPLEMENTARY INFORMATION CITY OF EVANSTON, ILLINOIS Required Supplementary Information Other Postemployment Benefits December 31, 2016 Schedule of Funding Progress (6) (2)UAAL Actuarial (4)as a Actuarial (1)Accrued (3)Unfunded Percentage Valuation Actuarial Liability Funded AAL (5)of Covered Date Value of (AAL)Ratio (UAAL)Covered Payroll December 31,Assets Entry-Age (1) / (2)(2) - (1)Payroll (4) / (5) 2011*-$ 16,994,544$ -$ 16,994,544$ 48,101,372$ 35.33% 2012 - 17,294,689 - 17,294,689 49,784,920 34.74% 2013 - 16,018,745 - 16,018,745 47,024,745 34.06% 2014 - 15,789,873 - 15,789,873 53,652,399 29.43% 2015 - 16,003,826 - 16,003,826 55,530,233 28.82% 2016 - 14,727,934 - 14,727,934 61,860,592 23.81% * The City changed to a December 31 year end for the fiscal year ended December 31, 2011. Schedule of Employer Contributions Annual Required Fiscal Employer Contribution Percentage Year Contributions (ARC)Contributed 2011*804,013$ 939,268$ 85.60% 2012 872,419 1,128,615 77.30% 2013 919,845 1,101,611 83.50% 2014 925,407 1,102,988 83.90% 2015 1,004,111 1,104,196 90.94% 2016 766,541 1,312,571 58.40% * The City changed to a December 31 year end for the fiscal year ended December 31, 2011. (See independent auditor's report.) - 80 - CITY OF EVANSTON, ILLINOIS Schedule of Employer Contributions Illinois Municipal Retirement Fund Last Two Fiscal Years FISCAL YEAR ENDED DECEMBER 31, 2015 2016 Actuarially determined contribution 3,977,718$ 3,882,629$ Contributions in relation to the actuarially determined contribution 4,018,268 3,963,856 Contribution Deficiency (Excess)(40,550) (81,227) Percentage contributed 101.0%102.1% Covered-employee payroll 37,703,487 37,477,116 Contributions as a percentage of covered-employee payroll 10.7%10.6% Notes to the Required Supplemental Information The information presented was determined as part of the actuarial valuations as of January 1 of the prior fiscal year.Additional information as of the latest actuarial valuation presented is as follows:the actuarial cost method was entry-age normal;the amortization method was level percent of pay,closed and the amortization period was 28 years;the asset valuation method was market;and the significant actuarial assumptions were an investment rate of return at 7.49%annually,projected salary increases assumption of 3.75%to 14.50%annually and postretirement benefit increases of 3.00% compounded annually. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information will be presented for as many years as is available. (See independent auditor's report.) - 81 - CITY OF EVANSTON, ILLINOIS Schedule of Employer Contributions Police Pension Fund Last Two Fiscal Years FISCAL YEAR ENDED DECEMBER 31, 2014 2015 2016 Actuarially determined contribution 8,257,475$ 9,380,940$ 10,237,200$ Contributions in relation to the actuarially determined contribution 8,746,427 8,804,264 9,450,824 Contribution Deficiency (Excess)(488,952) 576,676 786,376 Percentage contributed 105.9%93.9%92.3% Covered-employee payroll 13,537,726 14,921,328 17,474,672 Contributions as a percentage of covered-employee payroll 64.6%59.0%54.1% Notes to the Required Supplemental Information The information presented was determined as part of the actuarial valuations as of January 1.Additional information as of the latest actuarial valuation presented is as follows:the actuarial cost method was entry-age normal;the amortization method was level percent of pay,closed and the amortization period was 25 years;the asset valuation method was market and the significant actuarial assumptions were an investment rate of return at 7.50%annually,projected salary increases assumption of 3.62%to 7.36%annually and postretirement benefit increases of 3.00% compounded annually. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information will be presented for as many years as is available. (See independent auditor's report.) - 82 - CITY OF EVANSTON, ILLINOIS Schedule of Employer Contributions Firefighters' Pension Fund Last Two Fiscal Years FISCAL YEAR ENDED DECEMBER 31, 2014 2015 2016 Actuarially determined contribution 5,903,483$ 7,350,865$ 8,148,709$ Contributions in relation to the actuarially determined contribution 6,527,697 6,385,244 7,396,641 Contribution Deficiency (Excess)(624,214)$ 965,621$ 752,068$ Percentage contributed 110.6%86.9%90.8% Covered-employee payroll 9,520,925$ 10,396,357$ 10,546,779$ Contributions as a percentage of covered-employee payroll 68.6%61.4%70.1% Notes to the Required Supplemental Information The information presented was determined as part of the actuarial valuations as of January 1.Additional information as of the latest actuarial valuation presented is as follows:the actuarial cost method was entry-age normal;the amortization method was level percent of pay,closed and the amortization period was 25 years;the asset valuation method was market;and the significant actuarial assumptions were an investment rate of return at 6.50%annually,projected salary increases assumption of 3.62%to 7.36%annually and postretirement benefit increases of 3.00% compounded annually. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information will be presented for as many years as is available. (See independent auditor's report.) - 83 - CITY OF EVANSTON, ILLINOIS Schedule of Changes in the Employer's Net Pension Liability and Related Ratios Illinois Municipal Retirement Fund Last Two Fiscal Years MEASUREMENT DATE DECEMBER 31, 2014 2015 Total Pension Liability Service Cost 3,898,440$ 3,910,996$ Interest 14,880,724 16,235,086 Changes in benefit terms - - Differences between expected and actual experience 3,043,895 1,465,442 Changes of assumptions 7,927,038 266,906 Benefit payments, including refunds of member contributions (11,468,097) (11,928,345) Net Change in Total Pension Liability 18,282,000 9,950,085 Total Pension Liability - Beginning 202,194,485 220,476,485 Total Pension Liability - Ending 220,476,485$ 230,426,570$ Plan Fiduciary Net Position Contributions - employer 3,963,983$ 4,018,268$ Contributions - member 1,710,168 1,767,523 Net investment income 12,425,190 1,062,353 Benefit payments, including refunds of member contributions (11,468,097) (11,928,345) Administrative expense 2,322,043 737,427 Net Change in Plan Fiduciary Net Position 8,953,287 (4,342,774) Plan Fiduciary Net Position - Beginning 206,588,617 215,541,904 Plan Fiduciary Net Position - Ending 215,541,904$ 211,199,130$ Employer's Net Pension Liability 4,934,581$ 19,227,440$ Plan fiduciary net position as a percentage of the total pension liability 97.76%91.66% Covered-employee payroll 35,171,426$ 37,703,487$ Employer's net pension liability as a percentage of covered-employee payroll 14.03%51.00% There was a change in assumption related to the discount rate made since the prior measurement date.The discount rate used in the current actuarial valuation,dated December 31,2015,is 7.49%.The discount rate used in the prior actuarial valuations, dated December 31, 2014 was 7.50%. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information should be presented for as many years as is available. (See independent auditor's report.) - 84 - CITY OF EVANSTON, ILLINOIS Schedule of Changes in the Employer's Net Pension Liability and Related Ratios Police Pension Fund Last Three Fiscal Years MEASUREMENT DATE DECEMBER 31, 2014 2015 2016 Total Pension Liability Service Cost 3,439,223$ 3,488,385$ 3,679,212$ Interest 12,284,036 12,663,010 13,192,680 Changes in benefit terms - - - Differences between expected and actual experience - 3,928,479 (3,214,201) Changes of assumptions - 5,791,392 11,039,027 Benefit payments, including refunds of member contributions (9,891,045) (10,424,955) (10,970,916) Net Change in Total Pension Liability 5,832,214 15,446,311 13,725,802 Total Pension Liability - Beginning 183,492,025 189,324,239 204,770,550 Total Pension Liability - Ending 189,324,239$ 204,770,550$ 218,496,352$ Plan Fiduciary Net Position Contributions - employer 8,644,196$ 8,804,264$ 9,450,824$ Contributions - member 1,565,053 1,454,720 1,731,740 Net investment income 8,675,133 430,756 7,544,856 Benefit payments, including refunds of member contributions (9,891,045) (10,424,955) (10,970,916) Administrative expense (68,938) (71,408) (123,796) Net Change in Plan Fiduciary Net Position 8,924,399 193,377 7,632,708 Plan Fiduciary Net Position - Beginning 90,763,143 99,687,542 98,558,837 Prior period adjustment - (1,322,082) - Plan Fiduciary Net Position - Beginning, restated 90,763,143 98,365,460 98,558,837 Plan Fiduciary Net Position - Ending 99,687,542$ 98,558,837$ 106,191,545$ Employer's Net Pension Liability 89,636,697$ 106,211,713$ 112,304,807$ Plan fiduciary net position as a percentage of the total pension liability 52.65%48.13%48.60% Covered-employee payroll 13,537,726$ 14,921,328$ 17,474,672$ Employer's net pension liability as a percentage of covered-employee payroll 662.13%711.81%642.67% There was a change in assumption related to the discount rate made since the prior measurement date.The discount rate used in the prior actuarial valuation, dated December 31, 2015, is 6.50%. The discount rate used in the valuation dated, dated December 31, 2014 was 6.75%. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information should be presented for as many years as is available. (See independent auditor's report.) - 85 - CITY OF EVANSTON, ILLINOIS Schedule of Changes in the Employer's Net Pension Liability and Related Ratios Fire Pension Fund Last Three Fiscal Years MEASUREMENT DATE DECEMBER 31, 2014 2015 2016 Total Pension Liability Service Cost 2,326,092$ 2,431,680$ 2,731,257$ Interest 9,391,253 9,656,198 9,922,911 Changes in benefit terms - - - Differences between expected and actual experience - 1,184,609 (3,239,221) Changes of assumptions - 4,239,272 7,971,672 Benefit payments, including refunds of member contributions (7,727,683) (8,067,965) (8,343,940) Net Change in Total Pension Liability 3,989,662 9,443,794 9,042,679 Total Pension Liability - Beginning 140,667,430 144,657,092 154,100,886 Total Pension Liability - Ending 144,657,092$ 154,100,886$ 163,143,565$ Plan Fiduciary Net Position Contributions - employer 6,527,697$ 6,385,244$ 7,396,641$ Contributions - member 919,874 956,092 997,198 Net investment income 3,549,131 228,236 3,894,765 Benefit payments, including refunds of member contributions (7,727,683) (8,067,965) (8,343,940) Administrative expense (52,248) (44,597) (85,750) Net Change in Plan Fiduciary Net Position 3,216,771 (542,990) 3,858,914 Plan Fiduciary Net Position - Beginning 65,024,941 68,241,712 66,741,084 Prior period adjustment - (957,638) - Plan Fiduciary Net Position - Beginning, restated 65,024,941 67,284,074 66,741,084 Plan Fiduciary Net Position - Ending 68,241,712$ 66,741,084$ 70,599,998$ Employer's Net Pension Liability 76,415,380$ 87,359,802$ 92,543,567$ Plan fiduciary net position as a percentage of the total pension liability 47.17%43.31%43.27% Covered-employee payroll 9,520,925$ 10,396,357$ 10546779 Employer's net pension liability as a percentage of covered-employee payroll 802.60%840.29%877.46% There was a change in assumption related to the discount rate made since the prior measurement date.The discount rate used in the prior actuarial valuation,dated December 31,2015,is 6.50%.The discount rate used in the actuarial valuation dated December 31,2014 was 6.75%. Ultimately,this schedule should present information for the last ten years.However,until ten years of information can be compiled, information should be presented for as many years as is available. (See independent auditor's report.) - 86 - CITY OF EVANSTON, ILLINOIS General Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original Final Budget Budget Actual Variance Revenues Taxes 55,017,707$ 55,017,707$ 54,336,773$ (680,934)$ Licenses and permits 14,731,627 14,731,627 17,933,413 3,201,786 Intergovernmental 19,220,377 19,220,377 18,445,108 (775,269) Charges for services 8,301,251 8,301,251 8,694,803 393,552 Fines 4,609,825 4,609,825 3,611,901 (997,924) Investment income 50,000 50,000 30,285 (19,715) Miscellaneous 1,365,559 1,365,559 1,338,381 (27,178) Total Revenues 103,296,346 103,296,346 104,390,664 1,094,318 Expenditures General management and support 15,836,565 15,836,565 15,929,444 92,879 Public safety 60,183,847 60,183,847 60,939,168 755,321 Public works 14,732,178 13,732,178 13,240,692 (491,486) Health and human services development 4,172,060 4,238,613 3,021,327 (1,217,286) Recreation and cultural opportunities 11,716,670 11,741,670 11,893,837 152,167 Housing and economic development 2,685,379 2,728,244 2,455,754 (272,490) Total Expenditures 109,326,699 108,461,117 107,480,222 (980,895) Excess (Deficiency) of Revenues Over Expenditures (6,030,353) (5,164,771) (3,089,558) 2,075,213 Other Financing Sources (Uses) Transfers in 9,727,159 9,727,159 8,099,626 (1,627,533) Transfers (out)(4,238,650) (4,238,650) (4,046,971) 191,679 Total Other Financing Sources (Uses)5,488,509 5,488,509 4,052,655 (1,435,854) Net Change in Fund Balance (541,844)$ 323,738$ 963,097 639,359$ Fund Balances Beginning of Year 10,704,836 End of Year 11,667,933$ (See independent auditor's report.) - 87 - CITY OF EVANSTON, ILLINOIS Schedule of Investment Returns Police Pension Fund Last Three Fiscal Years FISCAL YEAR ENDED DECEMBER 31, 2014 2015 2016 Annual money-weighted rate of return, net of investment expense 9.54%1.45%6.90% Ultimately,this schedule should present return information for the last ten years.However,until ten years of information can be compiled, return information should be presented for as many years as is available. (See independent auditor's report.) - 88 - CITY OF EVANSTON, ILLINOIS Schedule of Investment Returns Firefighters' Pension Fund Last Three Fiscal Years FISCAL YEAR ENDED DECEMBER 31, 2014 2015 2016 Annual money-weighted rate of return, net of investment expense 5.47%0.36%5.90% Ultimately,this schedule should present return information for the last ten years.However,until ten years of information can be compiled, return information should be presented for as many years as is available. (See independent auditor's report.) - 89 - CITY OF EVANSTON, ILLINOIS Notes to Required Supplementary Information December 31, 2016 Budgetary Information The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1. 2.Public budget hearings are conducted. Taxpayer comments are received and noted. 3.The budget is legally enacted through passage of a resolution. 4. 5. Discrete Component Unit: 1. 2. 3. 4. 5. Fund Actual Budget Variance Special Service District No. 4 $ 323,000 $ 320,000 $ 3,000 Motor Fuel Tax Fund 130,789 - 130,789 Chicago-Main TIF Fund 1,756,993 43,500 1,713,493 A series of public Library Board meetings are conducted as the EPL Board considers the budget proposal. Taxpayer comments are received and noted. Because of a calendar year,the City Manager will submit to the City Council a proposed operating budget for the upcoming fiscal year commencing January 1,2016.The operating budget includes proposed expenditures and the means of financing them. The City Manager is authorized to transfer budgeted amounts between departments within any fund; however,any revisions that alter the total expenditures of any fund must be approved by the City Council. There were budget allocations within General Fund. Budgets are legally adopted on a basis consistent with GAAP except that property taxes are budgeted as revenue in the year they are levied.For purposes of preparing the General Fund -budget and actual (budgetary basis)schedule of revenues,expenditures,and changes in fund balance,GAAP revenues and expenditures have been adjusted to the budgetary basis.The Dempster Dodge TIF Fund was not budgeted. The Library follows these procedures in establishing the budgetary data reflected in the financial statements: Because of a calendar year,the Library Director submits a proposed operating budget for the upcoming fiscal year commencing January 1,2016 to the EPL Board of Trustees.Upon approval of the budget proposal by the EPL Board,the Library’s proposed budget is submitted to the City Manager.The Library's budget is included in the budget documents which the City Manager will submit to the City Council. The operating budget includes proposed expenditures and the means of financing them. The following funds had an excess of actual budgetary expenditures over original and final budget for the fiscal year ended December 31, 2016: The budget is legally enacted through passage of a resolution by the Library Board of Trustees. The Library Director is authorized to transfer budgeted amounts between library departments within any library fund;however,any revisions that alter the total expenditures of any library fund must be approved by the EPL Board of Trustees.There were budget allocations within the Library Fund but the total did not change. Budgets are legally adopted on a basis consistent with GAAP except that property taxes are budgeted as revenue in the year they are levied.For purposes of preparing the Library Operating Fund -budget and actual (budgetary basis)schedule of revenues,expenditures,and changes in fund balance,GAAP revenues and expenditures have been adjusted to the budgetary basis. The level of control (level at which expenditures may not exceed budget)is the fund.All unencumbered annual appropriations lapse at the end of the fiscal year. - 90 - COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES MAJOR GOVERNMENTAL FUNDS General Fund - to account for all financial resources of the City except those accounted for in another fund. General Obligation Debt Fund - to account for non-abated, general obligation payments on the principal and interest related to bonds and/or other city debt. CITY OF EVANSTON, ILLINOIS General Fund Schedule of Revenues - Budget and Actual For the Fiscal Year Ended December 31, 2016 Variance with Final Budget Original Final Over Budget Budget Actual (Under) Revenues Taxes Property Current year levy 27,167,407$ 27,167,407$ 27,298,982$ 131,575$ Prior year levy 250,000 250,000 3,706 (246,294) Total Property Taxes 27,417,407 27,417,407 27,302,688 (114,719) Personal Property Replacement Tax 1,451,300 1,451,300 1,421,037 1,421,037 Other Taxes State use tax 1,600,000 1,600,000 1,809,147 209,147 Sales tax - home rule 6,489,000 6,489,000 6,156,529 (332,471) Auto rental tax 50,000 50,000 57,375 7,375 Athletic contest tax 1,000,000 1,000,000 918,370 (81,630) Utility tax 7,210,000 7,210,000 6,661,934 (548,066) Cigarette tax 200,000 200,000 420,074 220,074 Evanston motor fuel tax 700,000 700,000 796,485 96,485 Medical Cannabis tax 50,000 50,000 1,255 (48,745) Liquor tax 3,000,000 3,000,000 2,647,321 (352,679) Parking tax 2,850,000 2,850,000 2,616,846 (233,154) Real estate transfer tax 3,000,000 3,000,000 3,527,712 527,712 Total Other Taxes 26,149,000 26,149,000 25,613,048 (535,952) Total Taxes 55,017,707 55,017,707 54,336,773 (680,934) Licenses and Permits Vehicle licenses 2,850,300 2,850,300 2,609,917 (240,383) Business licenses 50,000 50,000 89,205 39,205 Bed and breakfast licenses 75 75 205 130 Collection box license 2,500 2,500 2,100 (400) Pet licenses 28,000 28,000 20,115 (7,885) Contractor licenses 77,302 77,302 164,682 87,380 Rooming house licenses 200,000 200,000 163,899 (36,101) Liquor licenses 475,000 475,000 525,139 50,139 One-day liquor licenses 12,000 12,000 10,130 (1,870) Farmer's market licenses 41,500 41,500 48,763 7,263 Rental building register 100,000 100,000 44,260 (55,740) Other licenses 20,000 20,000 - (20,000) Long-term care license 98,400 98,400 94,180 (4,220) Seasonal foot ESTB 19,500 19,500 10,938 (8,562) Mobile food vehicle license 1,000 1,000 1,514 514 Hen coop license 800 800 1,000 200 Resident care home license 600 600 1,120 520 Building permits 7,500,000 7,500,000 8,485,571 985,571 Plumbing permits 200,000 200,000 172,363 (27,637) Electrical permits 305,000 305,000 193,234 (111,766) Signs and awnings 8,330 8,330 10,519 2,189 Other/miscellaneous permits 250,920 250,920 503,239 252,319 Elevator permits 32,000 32,000 42,010 10,010 Heating vent/AC permits 350,000 350,000 705,303 355,303 Right of way permits 400,000 400,000 669,806 269,806 (This schedule is continued on the following pages.) - 91 - CITY OF EVANSTON, ILLINOIS General Fund Schedule of Revenues - Budget and Actual For the Fiscal Year Ended December 31, 2016 Variance with Final Budget Original Final Over Budget Budget Actual (Under) Revenues - Continued Licenses and Permits - Continued Property cleaning permit -$ -$ 492$ 492$ Residents parking permit 128,000 128,000 104,144 (23,856) Visitor parking permit 12,300 12,300 15,431 3,131 Fire suppression/alarm permit 90,000 90,000 111,027 21,027 Annual sign fees 25,000 25,000 24,593 (407) Moving van permit 50,000 50,000 30,310 (19,690) Plat PR. and Sign approval HRG fees 2,100 2,100 1,750 (350) IL Bell franchise fee - - 243,623 243,623 Alarm panel franchise fee 6,000 6,000 1,680 (4,320) Cable franchise fee 1,200,000 1,200,000 1,307,634 107,634 PEG fees - Comcast 130,000 130,000 200,892 70,892 Nicor franchise fee 65,000 65,000 59,379 (5,621) Transfer Station fees - - 1,263,246 1,263,246 Total Licenses and Permits 14,731,627 14,731,627 17,933,413 3,201,786 Intergovernmental - Revenue from Other Agencies Retailer and service occupation tax 10,779,950 10,779,950 10,216,966 (562,984) State income tax 7,650,000 7,650,000 7,155,930 (494,070) State highway maintenance 68,000 68,000 82,491 14,491 Health Department Basic Service Grant 76,000 76,000 76,181 181 Summer food inspections 400 400 1,050 650 Illinois tobacco free community 31,027 31,027 21,039 (9,988) IL HIV Surveillance Grant 4,000 4,000 267 (3,733) Childhood Lead Poisoning Grant 1,000 1,000 2,484 1,484 Other State/County Grant 11,000 11,000 137,588 126,588 Tanning parlor inspection 300 300 - (300) Fire Department training 6,000 6,000 - (6,000) CRI Grant 44,000 44,000 45,075 1,075 PEHP Grant 62,000 62,000 71,526 9,526 Evanston Township - Housing - - 1,426 1,426 Leadbase Paint Control Grant 100,000 100,000 - (100,000) Federal Grant/Aid 8,000 8,000 345,150 337,150 Commission on Aging Grant - Advocate 87,150 87,150 98,598 11,448 IL Vacant Property Grant 71,000 71,000 5,575 (65,425) Civil Devence Grants (F.E.M.A.)17,000 17,000 38,613 21,613 Police training 8,000 8,000 250 (7,750) HUD Emergency Shelter Grant 135,550 135,550 106,218 (29,332) Other Federal Aid - - 2,016 2,016 Youth Organization Umbrella Grant 40,000 40,000 36,665 (3,335) RTA Grant 20,000 20,000 - (20,000) Total Intergovernmental - Revenue from Other Agencies 19,220,377 19,220,377 18,445,108 (775,269) Charges for Services Recreation Recreation - program 5,374,751 5,374,751 5,394,237 19,486 Recreation - charges - - 3,909 3,909 Recreation - deferral - - 3,417 3,417 Recreation - unreconciled 25,000 25,000 27,341 2,341 Total Recreation Revenue 5,399,751 5,399,751 5,428,904 29,153 (This schedule is continued on the following pages.) - 92 - CITY OF EVANSTON, ILLINOIS General Fund Schedule of Revenues - Budget and Actual For the Fiscal Year Ended December 31, 2016 Variance with Final Budget Original Final Over Budget Budget Actual (Under) Revenues - Continued Charges for Services (Continued) Other Charges for Services Health Clinic Fees - food establishment 190,000$ 190,000$ 230,129$ 40,129$ Temporary license fee 7,500 7,500 10,765 3,265 Food delivery vehicle 5,500 5,500 5,100 (400) Beverage snack vending machine 28,000 28,000 36,275 8,275 Tobacco license 19,000 19,000 11,922 (7,078) Beekeeper license - - 100 100 Birth certificate 75,000 75,000 119,141 44,141 Death certificate 36,000 36,000 21,004 (14,996) Funeral director license 6,000 6,000 4,787 (1,213) Temp funeral director licenses 4,200 4,200 3,124 (1,076) Parking meter fee increase 640,000 640,000 640,000 - Parking enforcement Reimbursement - - 47,835 47,835 Weights and exact measures examinations 1,200 1,200 80 (1,120) Senior Taxi coupon sales 100,000 100,000 82,067 (17,933) Fire cost recovery charge 10,000 10,000 1,920 (8,080) Other services charges - - - - Historic preservation 7,200 7,200 46,873 39,673 Tree preservation revenue 3,500 3,500 15,926 12,426 Ambulance service 1,500,000 1,500,000 1,645,173 145,173 Towing charges 1,000 1,000 - (1,000) Police report fees 20,000 20,000 25,705 5,705 Wood recycling 40,000 40,000 27,514 (12,486) Zoning fees 55,000 55,000 63,745 8,745 Fire building inspections - - 60 60 Fire report fee 8,000 8,000 13,655 5,655 Passport processing Fee - - 15,364 15,364 Alarm panel subscription fees 111,000 111,000 97,065 (13,935) Skokie animal board fee 8,000 8,000 - (8,000) Background check daycare providers 400 400 450 50 New pavement degradation 10,000 10,000 97,387 87,387 I Heart Evanston Trees project 10,000 10,000 (50) (10,050) Plan review 5,000 5,000 2,783 (2,217) Total Other Service Charges 2,901,500 2,901,500 3,265,899 364,399 Total Charges for Services 8,301,251 8,301,251 8,694,803 393,552 Fines Ticket fines - parking 3,594,500 3,594,500 2,815,728 (778,772) Regular fines 100,000 100,000 110,906 10,906 Building code violations - - 335 335 Animal ordinance penalties - - 1,310 1,310 Boot release fee 45,000 45,000 53,450 8,450 Fire false alarm fines 140,000 140,000 57,155 (82,845) Police CTA detail 400,000 400,000 278,392 (121,608) Police false alarm fines - - 38,760 38,760 (This schedule is continued on the following page.) - 93 - CITY OF EVANSTON, ILLINOIS General Fund Schedule of Revenues - Budget and Actual For the Fiscal Year Ended December 31, 2016 Variance with Final Budget Original Final Over Budget Budget Actual (Under) Revenues - Continued Fines - Continued Housing code violation fines 60,000$ 60,000$ 57,680$ (2,320)$ Permit penalty fees 7,500 7,500 8,841 1,341 Administrative adjudication fee 262,825 262,825 189,344 (73,481) Total Fines 4,609,825 4,609,825 3,611,901 (997,924) Investment Income 50,000 50,000 30,285 (19,715) Other Revenues Police equipment reimbursement - - 8,033 8,033 Reimbursements 46,716 46,716 36,284 (10,432) Holiday food drive - - 9,205 9,205 Women Out Walking 5,000 5,000 6,446 1,446 Forfeited FSA - - 30,327 30,327 Property sales and rentals 51,543 51,543 93,379 41,836 Donation 37,000 37,000 18,725 (18,275) Damage to City signage 2,000 2,000 - (2,000) Damage to City traffic signal 20,000 20,000 - (20,000) Damage to street lights 10,000 10,000 - (10,000) Miscellaneous revenue 156,300 156,300 117,004 (39,296) Market Link vouchers 20,000 20,000 23,398 3,398 Sale of other assets 70,000 70,000 230,310 160,310 Reimbursements - serve and protect 2,000 2,000 37,460 35,460 Reimbursements - sale use 75,000 75,000 36,619 (38,381) Reimbursements - fire department 25,000 25,000 93,997 68,997 Payment in lieu of taxes 267,000 267,000 61,500 (205,500) Fund balance applied 516,000 516,000 111,075 (404,925) Chargeback revenue - - 360,235 360,235 Private Elm Trees Insurance 41,000 41,000 38,710 (2,290) Citizens CPR class fees 6,000 6,000 8,798 2,798 Parking permits - Ryan Field 15,000 15,000 16,876 1,876 Component unit receipts - - - - Total Other Revenues 1,365,559 1,365,559 1,338,381 (27,178) Total Revenues 103,296,346$ 103,296,346$ 104,390,664$ 1,094,318$ (See independent auditor's report.) - 94 - CITY OF EVANSTON, ILLINOIS General Fund Schedule of Expenditures - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original Final Budget Budget Actual Variance Expenditures General Management and Support City Council 422,754$ 422,754$ 431,394$ 8,640$ City Manager and Budget Management 4,528,062 4,528,062 5,127,932 599,870 City Clerk 259,300 259,300 290,762 31,462 Law Department 1,111,823 1,111,823 1,033,953 (77,870) Administrative Services 9,514,626 9,514,626 9,045,400 (469,226) Total General Management and Support 15,836,565 15,836,565 15,929,441 92,876 Public Safety Police 37,587,918 37,587,918 37,709,267 121,349 Fire 22,595,929 22,595,929 23,229,901 633,972 Total Public Safety 60,183,847 60,183,847 60,939,168 755,321 Public Works Public Works Director 3,919,103 3,919,103 3,911,412 (7,691) Municipal Service Center 1,798,017 1,798,017 2,015,117 217,100 City Engineer 368,547 368,547 345,139 (23,408) Traffic Engineer 3,445,906 3,445,906 3,446,747 841 Streets 4,992,893 3,992,893 3,320,426 (672,467) Sanitation 207,712 207,712 201,851 (5,861) Total Public Works 14,732,178 13,732,178 13,240,692 (491,486) Health and Human Services Development Health and Human Services Director 313,460 313,460 317,802 4,342 Health Department 1,691,250 1,757,803 1,608,892 (148,911) Mental Health and Community Purchased Services 2,079,821 2,079,821 1,093,606 (986,215) Human Relations 87,529 87,529 1,027 (86,502) Total Health and Human Services Development 4,172,060 4,238,613 3,021,327 (1,217,286) Recreation and Cultural Opportunities Recreation 10,587,636 10,612,636 10,680,259 67,623 Ecology Center 460,046 460,046 519,384 59,338 Cultural Arts 668,988 668,988 693,914 24,926 Library - - 280 280 Total Recreation and Cultural Opportunities 11,716,670 11,741,670 11,893,837 152,167 Housing and Economic Development Community Development Administration 302,490 302,490 341,020 38,530 Planning and Zoning 637,452 680,317 608,194 (72,123) Housing Rehabilitation and Property Standards - - 3,149 3,149 Building Code Compliance 1,745,437 1,745,437 1,503,391 (242,046) Total Housing and Economic Development 2,685,379 2,728,244 2,455,754 (272,490) Total Expenditures 109,326,699$ 108,461,117$ 107,480,219$ (980,898)$ (See independent auditor's report.) - 95 - CITY OF EVANSTON, ILLINOIS General Obligation Debt Fund Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Taxes Property taxes Current year levy, net 10,879,993$ 10,438,928$ Prior year levy, net - - Investment income 1,500 24,264 Miscellaneous - - Total Revenues 10,881,493 10,463,192 General management and support 195,520 138,088 Debt Service Principal 12,784,557 19,255,943 Interest 4,431,802 4,198,920 Fiscal agent fees 120,250 11,525 Total Expenditures 17,532,129 23,604,476 Excess (Deficiency) of Revenues Over Expenditures (6,650,636) (13,141,284) Issuance of bonds - 7,635,000 Premium on bond issuances - 576,196 Transfers in 2,646,291 2,999,879 Transfers in From Component Unit - - Total Other Financing Sources (Uses)2,646,291 11,211,075 Net Changes in Fund Balances (4,004,345)$ (1,930,209) Fund Balances Beginning of Year 2,596,116 End of Year 665,907$ Revenues Expenditures Other Financing Sources (Uses) (See independent auditor's report.) - 96 - NONMAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special Revenue Funds are used to account for specific revenues that are legally restricted to expenditures for a particular purpose. Motor Fuel Tax - to account for the operation of street maintenance programs and capital projects as authorized by the Illinois Department of Transportation. Financing is provided by the City’s share of gasoline taxes. Economic Development - to account for the cost associated with economic development activities of the City. Financing is provided primarily by Hotel Tax revenues. Emergency Telephone System - to account for revenues and expenditures for 911 emergency telephone service. Financing provided by network connection surcharges. Neighborhood Improvement - to account for a portion of the sales tax revenues derived from retail sales of the Home Depot U.S.A. Inc. store in the City. Sales tax revenues allocated to this fund are to be expended on public projects that will benefit the immediate neighborhood of the store. Affordable Housing - to account for costs associated with housing-related programs of the City. HOME - to account for the activity of the HOME program. Financing is provided by the federal government. Expenditures are made in accordance with the requirements of federal law. Community Development Block Grant - to account for revenues and expenditures of the Community Block Grant program. Financing is provided by the federal government on a reimbursement basis in accordance with federal formula. Expenditures are made in accordance with the requirements of federal law. Community Development Loan - to account for residential rehabilitation loans to residents. Neighborhood Stabilization Program 2 - funded by the American Recovery and Reinvestment Act of 2009 to stabilize neighborhoods that have been negatively impacted by high numbers of foreclosed and vacant homes. Special Service District No. 4 - to account for promotion, advertisement, and street maintenance costs of the area located in the City’s central business district. Financing is provided by the City through an annual property tax levy. General Assistance - to account for the assistance given to persons and/or families to meet their basic living expenses. Good Neighbor - to account for the resources provided by Northwestern University to assist City functions and increase programming. Capital Projects Funds Capital Improvement - To account for capital projects not funded through special revenue, tax increment financing, or enterprise funds. Capital projects include, but are not limited to: long-term improvements to public buildings, the paving of city streets, and the improvement and development of recreation facilities. Financing is provided primarily by grants and general obligation bond proceeds. Special Assessment - To account for capital improvements (primarily alley paving) financed by both special assessments on property owners and City contributions. Debt Service Funds Debt Service Funds are used to account for the servicing of general long-term debt. Special Service Area No. 5 - To account for principal and interest payments on debt issued for this special taxing district. Chicago Main TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Southwest TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Dempster-Dodge TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Howard Hartrey TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Washington National TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Howard/Ridge TIF- To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. West Evanston TIF - To account for principal and interest payments on debt proceeds issued and allocated to this tax increment financing district. Special Service Area No. 6 Fund - to account for promotion, advertisement, and street maintenance costs of the area located in the City's commercial district surrounding Dempster, Chicago, and Main. Financing is provided by the City through an annual special service area property tax levy. CITY OF EVANSTON, ILLINOIS Combining Balance Sheet Nonmajor Governmental Funds December 31, 2016 Emergency Motor Fuel Economic Telephone Neighborhood Affordable Tax Development System Improvement Housing Cash and equivalents -$ 272,027$ -$ 169,915$ 1,020,021$ Investments 1,236,977 393,669 648,393 - 364,998 Receivables Property tax - - - - - Notes - - - - 961,657 Special assessments - - - - - Other - 451,994 - - - Due from other governments 176,701 - 325,472 - - Due from component unit - 484 - - - Due from other funds - 1,947,920 - - 21,211 Advances to other funds - - - - - Total Assets 1,413,678$ 3,066,094$ 973,865$ 169,915$ 2,367,887$ Liabilities Vouchers payable -$ 69,868$ 54,086$ -$ 5,042$ Due to other governments - - - - - Due to other funds - - 648,393 - - Advances from other funds - - 108,325 - - Unearned revenue - - - - - Total Liabilities - 69,868 810,804 - 5,042 Deferred Inflows of Resources Long-term notes receivable - - - - 961,657 Unavailable revenue - property taxes - - - - - Total Deferred Inflows of Resources - - - - 961,657 Total Liabilities and Deferred Inflows of Resources - 69,868 810,804 - 966,699 Fund Balances Restricted for Highway Maintenance 1,413,678 - - - - Emergency Telephone System - - 163,061 - - HUD Approved Projects - - - - - Neighborhood Improvements - - - 169,915 1,401,188 Capital outlay - - - - - Debt Service - - - - - Township - - - - - Committed - 2,996,226 - - - Assigned - - - - - Unassigned (deficit)- - - - - Total Fund Balances (Deficit)1,413,678 2,996,226 163,061 169,915 1,401,188 Total Liabilities, Deferred Inflows of Resources, and Fund Balances 1,413,678$ 3,066,094$ 973,865$ 169,915$ 2,367,887$ Assets Special Revenue - 97 - Special Community Community Neighborhood Service Total Development Development Stabilization District Good General Special HOME Block Grant Loan Program 2 No. 4 Neighbor Assistance Revenue -$ -$ 208,504$ 99,472$ -$ 1,000,000$ 591,211$ 3,361,150$ - - - - - - 14,822 2,658,859 - - - - 329,460 - 900,000 1,229,460 4,890,677 196,352 1,894,669 - - - - 7,943,355 - - - - - - - - - - - - - - - 451,994 20,072 421,403 1,316 - - - - 944,964 - - - - - - - 484 1,071 8,741 81,164 - - - - 2,060,107 - - - 39,741 - - - 39,741 4,911,820$ 626,496$ 2,185,653$ 139,213$ 329,460$ 1,000,000$ 1,506,033$ 18,690,114$ 10,025$ 120,989$ 79,254$ -$ 80,750$ -$ 2,710$ 422,724$ - - - 132,410 - - - 132,410 8,741 245,049 809 6,803 111,526 - 16,935 1,038,256 - - - - - - - 108,325 - - - - - 1,000,000 - 1,000,000 18,766 366,038 80,063 139,213 192,276 1,000,000 19,645 2,701,715 4,890,677 196,352 1,894,669 - - - - 7,943,355 - - - - 329,460 - 900,000 1,229,460 4,890,677 196,352 1,894,669 - 329,460 - 900,000 9,172,815 4,909,443 562,390 1,974,732 139,213 521,736 1,000,000 919,645 11,874,530 - - - - - - - 1,413,678 - - - - - - - 163,061 2,377 64,106 210,921 - - - - 277,404 - - - - - - - 1,571,103 - - - - - - - - - - - - - - - - - - - - - - 586,388 586,388 - - - - - - - 2,996,226 - - - - - - - - - - - - (192,276) - - (192,276) 2,377 64,106 210,921 - (192,276) - 586,388 6,815,584 4,911,820$ 626,496$ 2,185,653$ 139,213$ 329,460$ 1,000,000$ 1,506,033$ 18,690,114$ Special Revenue (This schedule is continued on the following pages.) - 98 - CITY OF EVANSTON, ILLINOIS Combining Balance Sheet Nonmajor Governmental Funds December 31, 2016 Special Chicago Main Special Howard Hartrey Service Tax Service Tax District Increment Area Increment No. 5 District No. 6 District Cash and equivalents -$ 135,077$ 165,699$ -$ Investments - - - 726,204 Receivables Property tax - - 210,000 - Notes - - - - Special assessments - - - - Other - - - - Due from other governments - - - 85,305 Due from component unit - - - - Due from other funds - - - - Advances to other funds - - - - Total Assets -$ 135,077$ 375,699$ 811,509$ Liabilities Vouchers payable -$ -$ 87,405$ 81,587$ Due to other governments - - - - Due to other funds - - - 86,249 Advances from other funds - - - - Unearned revenue - - - - Total Liabilities - - 87,405 167,836 Deferred Inflows of Resources Long-term notes receivable - - - - Unavailable revenue - property taxes - - 210,000 - Total Deferred Inflows of Resources - - 210,000 - Total Liabilities and Deferred Inflows of Resources - - 297,405 167,836 Fund Balances Restricted for Highway Maintenance - - - - Emergency Telephone System - - - - HUD Approved Projects - - - - Neighborhood Improvements - - - - Capital outlay - - - - Debt Service - 135,077 - 643,673 Township - - - - Committed - - - - Assigned - - 78,294 - Unassigned (deficit)- - - - Total Fund Balances (Deficit)- 135,077 78,294 643,673 Total Liabilities, Deferred Inflows of Resources, and Fund Balances -$ 135,077$ 375,699$ 811,509$ Assets Debt Service - 99 - Washington National Dempster-Dodge Howard Ridge West Evanston Special Total Tax Tax Tax Tax Total Assessment Total Nonmajor Increment Increment Increment Increment Debt Capital Capital Capital Governmental District District District District Service Improvements Projects Projects Funds 1,532,723$ -$ 65,070$ -$ 1,898,569$ 7,620,462$ 2,769,704$ 10,390,166$ 15,649,885$ 4,721,659 - 1,726 510,839 5,960,428 5,382,522 221,523 5,604,045 14,223,332 - - - - 210,000 - - - 1,439,460 - - - - - - - - 7,943,355 - - - - - - 236,596 236,596 236,596 - - - - - - 4,281 4,281 456,275 - - - - 85,305 - 2,874 2,874 1,033,143 - - - - - 650,000 - 650,000 650,484 788,972 - 14,699 1,028 804,699 393,747 1,243 394,990 3,259,796 - - - - - - - - 39,741 7,043,354$ -$ 81,495$ 511,867$ 8,959,001$ 14,046,731$ 3,236,221$ 17,282,952$ 44,932,067$ 1,024,931$ -$ 26,472$ -$ 1,220,395$ 1,660,791$ 342$ 1,661,133$ 3,304,252$ - - - - - 310,378 - 310,378 442,788 393,747 29,415 1,028 94,607 605,046 570,398 67 570,465 2,213,767 - - 54,079 - 54,079 - - - 162,404 - - - - - - - - 1,000,000 1,418,678 29,415 81,579 94,607 1,879,520 2,541,567 409 2,541,976 7,123,211 - - - - - - 236,596 236,596 8,179,951 - - - - 210,000 - - - 1,439,460 - - - - 210,000 - 236,596 236,596 9,619,411 1,418,678 29,415 81,579 94,607 2,089,520 2,541,567 237,005 2,778,572 16,742,622 - - - - - - - - 1,413,678 - - - - - - - - 163,061 - - - - - - - - 277,404 - - - - - - 2,999,216 2,999,216 4,570,319 - - - - - 3,915,000 - 3,915,000 3,915,000 5,624,676 - 30,807 417,260 6,851,493 - - - 6,851,493 - - - - - - - - 586,388 - - - - - - - - 2,996,226 - - - - 78,294 7,590,164 - 7,590,164 7,668,458 - (29,415) (30,891) - (60,306) - - - (252,582) 5,624,676 (29,415) (84) 417,260 6,869,481 11,505,164 2,999,216 14,504,380 28,189,445 7,043,354$ -$ 81,495$ 511,867$ 8,959,001$ 14,046,731$ 3,236,221$ 17,282,952$ 44,932,067$ Capital ProjectsDebt Service (See independent auditor's report.) - 100 - CITY OF EVANSTON, ILLINOIS Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Fiscal Year Ended December 31, 2016 Emergency Motor Fuel Economic Telephone Neighborhood Affordable Tax Development System Improvement Housing Revenues Taxes -$ 2,257,692$ 1,038,331$ -$ 106,780$ Special assessments - - - - - Intergovernmental 1,896,461 - - - - Charges for services - - - - - Investment income 6,613 8,761 2,472 - 1,392 Miscellaneous Contributions - - - - 125,000 Other - 271,359 - - 323,343 Total Revenues 1,903,074 2,537,812 1,040,803 - 556,515 Expenditures Current General management and support - - - - - Public safety - - 1,287,253 - - Public works 130,789 - - - - Housing and economic development - 1,279,750 - - 149,207 Capital outlay - - - - - Debt service Principal - - - - - Interest - - - - - Fiscal agent fees - - - - - Total Expenditures 130,789 1,279,750 1,287,253 - 149,207 Excess (Deficiency) of Revenues Over Expenditures 1,772,285 1,258,062 (246,450) - 407,308 Other Financing Sources (Uses) Issuance of bonds - - - - - Issuance of loans - - - - - Premium (discount) on bonds issued - - - - - Transfers in - 47,500 - - - Transfers (out)(2,189,000) (865,318) (142,207) - - Total Other Financing Sources (Uses)(2,189,000) (817,818) (142,207) - - Net Change in Fund Balances (416,715) 440,244 (388,657) - 407,308 Fund Balances (Deficit), January 1 1,830,393 2,555,982 551,718 169,915 993,880 Fund Balances (Deficit), December 31 1,413,678$ 2,996,226$ 163,061$ 169,915$ 1,401,188$ Special Revenue - 101 - Community Community Neighborhood Special Service Total Development Development Stabilization District Good General Special HOME Block Grant Loan Program 2 No. 4 Neighbor Assistance Revenue -$ -$ -$ -$ 321,266$ -$ 827,615$ 4,551,684$ - - - - - - - - 178,211 2,016,478 - 91,446 - - - 4,182,596 - - - - - - - - 14 - 4,656 - 2 - 801 24,711 - - - - - - 1,000,000 - 1,125,000 27,259 10,197 208,541 - - - 49,590 890,289 205,484 2,026,675 213,197 91,446 321,268 1,000,000 878,006 10,774,280 - - - - - - 804,857 804,857 - - - - - - - 1,287,253 - - - - - - - 130,789 207,877 2,018,936 160,641 73,823 323,000 - - 4,213,234 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 207,877 2,018,936 160,641 73,823 323,000 - 804,857 6,436,133 (2,393) 7,739 52,556 17,623 (1,732) 1,000,000 73,149 4,338,147 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 47,500 - (3,515) - (17,623) - (1,000,000) - (4,217,663) - (3,515) - (17,623) - (1,000,000) - (4,170,163) (2,393) 4,224 52,556 - (1,732) - 73,149 167,984 4,770 59,882 158,365 - (190,544) - 513,239 6,647,600 2,377$ 64,106$ 210,921$ -$ (192,276)$ -$ 586,388$ 6,815,584$ Special Revenue (This schedule is continued on the following pages.) - 102 - CITY OF EVANSTON, ILLINOIS Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Fiscal Year Ended December 31, 2015 Special Chicago Main Special Howard Hartrey Washington National Service Tax Service Tax Tax District Increment Area Increment Increment No. 5 District No. 6 District District Revenues Taxes (180)$ -$ 223,296$ 1,233,675$ 4,729,649$ Special assessments - - - - - Intergovernmental - - - - - Charges for services - - - - - Investment income 35 - 2 2,319 14,012 Miscellaneous Contributions - - - - - Other - - - - - Total Revenues (145) - 223,298 1,235,994 4,743,661 Expenditures Current General management and support - - - - - Public safety - - - - - Public works - - - - - Housing and economic development 5,653 1,740,437 145,004 131,679 1,105,900 Capital outlay - - - - - Debt service Principal 405,000 - - - - Interest 23,186 16,556 - - - Fiscal agent fees - - - - - Total Expenditures 433,839 1,756,993 145,004 131,679 1,105,900 Excess (Deficiency) of Revenues Over Expenditures (433,984) (1,756,993) 78,294 1,104,315 3,637,761 Other Financing Sources (Uses) Issuance of bonds - - - - - Issuance of loans - 1,580,000 - - - Premium (discount) on bonds issued - - - - - Transfers in - - - - - Transfers (out)(91,445) - - (1,741,757) (4,455,515) Total Other Financing Sources (Uses)(91,445) 1,580,000 - (1,741,757) (4,455,515) Net Change in Fund Balances (525,429) (176,993) 78,294 (637,442) (817,754) Fund Balances (Deficit), January 1 525,429 312,070 - 1,281,115 6,442,430 Fund Balances (Deficit), December 31 -$ 135,077$ 78,294$ 643,673$ 5,624,676$ Debt Service - 103 - Dempster-Howard Ridge West Evanston Special Total Dodge Tax Tax Tax Total Assessment Total Nonmajor Increment Increment Increment Debt Capital Capital Capital Governmental District District District Service Improvements Projects Projects Funds -$ 533,105$ -$ 6,719,545$ -$ -$ -$ 11,271,229$ - - - - - 168,571 168,571 168,571 - - - - 2,177,914 - 2,177,914 6,360,510 - - - - 96,586 - 96,586 96,586 - 374 1,684 18,426 16,690 3,964 20,654 63,791 - - - - 243,000 - 243,000 1,368,000 - 282,307 11,311 293,618 1,305 - 1,305 1,185,212 - 815,786 12,995 7,031,589 2,535,495 172,535 2,708,030 20,513,899 - - - - 183,084 8,751 191,835 996,692 - - - - 26,000 - 26,000 1,313,253 - - - - 104,970 - 104,970 235,759 971 679,056 (521) 3,808,179 - - - 8,021,413 - - - - 9,953,056 - 9,953,056 9,953,056 - - - 405,000 - - - 405,000 28,444 693 8,519 77,398 - - - 77,398 - - - - 2,000 - 2,000 2,000 29,415 679,749 7,998 4,290,577 10,269,110 8,751 10,277,861 21,004,571 (29,415) 136,037 4,997 2,741,012 (7,733,615) 163,784 (7,569,831) (490,672) - - - - 8,990,000 460,000 9,450,000 9,450,000 - - - 1,580,000 - - - 1,580,000 - - - - 357,683 53,349 411,032 411,032 - - - - 4,864,055 - 4,864,055 4,911,555 - (107,500) (30,000) (6,426,217) (490,000) (360,698) (850,698) (11,494,578) - (107,500) (30,000) (4,846,217) 13,721,738 152,651 13,874,389 4,858,009 (29,415) 28,537 (25,003) (2,105,205) 5,988,123 316,435 6,304,558 4,367,337 - (28,621) 442,263 8,974,686 5,517,041 2,682,781 8,199,822 23,822,108 (29,415)$ (84)$ 417,260$ 6,869,481$ 11,505,164$ 2,999,216$ 14,504,380$ 28,189,445$ Capital ProjectsDebt Service (See independent auditor's report.) - 104 - CITY OF EVANSTON, ILLINOIS Motor Fuel Tax Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Intergovernmental allotments 1,710,000$ 1,896,461$ 186,461$ Interest 1,000 6,613 5,613 Total Revenues 1,711,000 1,903,074 192,074 Expenditures Public Works - 130,789 130,789 Excess (Deficiency) of Revenues Over Expenditures 1,711,000 1,772,285 61,285 Other Financing Sources (Uses) Transfers (out)(2,189,000) (2,189,000) - Net Change in Fund Balance (478,000)$ (416,715) 61,285$ Fund Balances Beginning of Year 1,830,393 End of Year 1,413,678$ (See independent auditor's report.) - 105 - CITY OF EVANSTON, ILLINOIS Economic Development Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Taxes and special assessments 2,165,000$ 2,257,692$ 92,692$ Interest 100 8,761 8,661 Miscellaneous 50,000 271,359 221,359 Total Revenues 2,215,100 2,537,812 322,712 Expenditures Housing and economic development 1,933,377 1,279,750 (653,627) Excess (Deficiency) of Revenues Over Expenditures 281,723 1,258,062 976,339 Other Financing Sources (Uses) Transfers in 47,500 47,500 - Transfers (out)(615,322) (865,318) (249,996) Other Financing Sources (Uses) - Net (567,822) (817,818) (249,996) Net Change in Fund Balance (286,099)$ 440,244 726,343$ Fund Balances Beginning of Year 2,555,982 End of Year 2,996,226$ (See independent auditor's report.) - 106 - CITY OF EVANSTON, ILLINOIS Emergency Telephone System Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Taxes and special assessments 1,018,000$ 1,038,331$ 20,331$ Interest 1,000 2,472 1,472 Total Revenues 1,019,000 1,040,803 21,803 Expenditures Public safety 1,374,436 1,287,253 (87,183) Excess (Deficiency) of Revenues Over Expenditures (355,436) (246,450) 108,986 Other Financing Sources (Uses) Transfers (out)(142,207) (142,207) - Net Change in Fund Balance (497,643)$ (388,657) 108,986$ Fund Balance Beginning of Year 551,718 End of Year 163,061$ (See independent auditor's report.) - 107 - CITY OF EVANSTON, ILLINOIS Neighborhood Improvement Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Taxes and special assessments 20,000$ -$ (20,000)$ Expenditures Housing and economic development 100,000 - (100,000) Net Change in Fund Balance (80,000)$ - 80,000$ Fund Balances Beginning of Year 169,915 End of Year 169,915$ (See independent auditor's report.) - 108 - CITY OF EVANSTON, ILLINOIS Affordable Housing Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Affordable housing demo tax 30,000$ 106,780$ 76,780$ Developer contributions 125,000 125,000 - Interest 228 1,392 1,164 Miscellaneous 5,400 323,343 317,943 Total Revenues 160,628 556,515 395,887 Expenditures Housing and economic development 929,347 149,207 (780,140) Net Change in Fund Balance (768,719)$ 407,308 1,176,027$ Fund Balance Beginning of Year 993,880 End of Year 1,401,188$ (See independent auditor's report.) - 109 - CITY OF EVANSTON, ILLINOIS HOME Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Intergovernmental allotments 393,868$ 178,211$ (215,657)$ Interest - 14 14 Miscellaneous 8,300 27,259 18,959 Total Revenues 402,168 205,484 (196,684) Expenditures Housing and economic development 402,168 207,877 (194,291) Net Change in Fund Balance -$ (2,393) (2,393)$ Fund Balance Beginning of Year 4,770 End of Year 2,377$ (See independent auditor's report.) - 110 - CITY OF EVANSTON, ILLINOIS Community Development Block Grant Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Intergovernmental allotments grant from U.S. Department of Housing and Urban Development 2,595,000$ 2,016,478$ (578,522)$ Miscellaneous - 10,197 10,197 Total Revenues 2,595,000 2,026,675 (568,325) Expenditures Housing and economic development 1,753,284 2,018,936 265,652 Total Expenditures 1,753,284 2,018,936 265,652 Excess (Deficiency) of Revenues Over Expenditures 841,716 7,739 (833,977) Other Financing Sources (Uses) Transfers (out)(841,341) (3,515) 837,826 Other Financing Sources (Uses) - Net (841,341) (3,515) 837,826 Net Change in Fund Balance 375$ 4,224 3,849$ Fund Balance Beginning of Year 59,882 End of Year 64,106$ (See independent auditor's report.) - 111 - CITY OF EVANSTON, ILLINOIS Community Development Block Grant Fund Schedule of Expenditures - Budget and Actual (Budgetary Basis) For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Administration/Planning CDBG administration 320,645$ 317,116$ (3,529)$ Total Administration/Planning 320,645 317,116 (3,529) Economic Development Evanston Community Development Corporation 14,492 147,500 133,008 Total Economic Development 14,492 147,500 133,008 Housing Rehab construction administration 234,505 182,854 (51,651) Targeted housing code enforcement 325,000 308,422 (16,578) Total Housing 559,505 491,276 (68,229) Neighborhood Revitalization Street resurfacing 168,436 216,488 48,052 Accessible Curb Ramp Program ADA - 95,265 95,265 Street light upgrade - 59,777 59,777 Snap lighting - 4,324 4,324 Foster Field Light FJ 211,479 230,569 19,090 Alley improvement/paving program - 2,406 2,406 Weissbourd/Fam Focus 80,000 56,900 (23,100) Howard St. enhancement 4,000 (4,000) YOU 64,443 113,031 48,588 Special assessments 10,000 - (10,000) Hill Arboretum 50,000 - (50,000) Peer-Windows - 14,000 14,000 Graffiti removal program 41,900 41,900 - Total Neighborhood Revitalization 630,258 834,660 204,402 Public Services Moran/Defender 25,000 25,000 - Evanston Legal Services 7,250 7,250 - Youth Job Center of Evanston 31,817 31,817 - City/Cert. of Rehab & Records 30,000 30,000 - Summer youth 22,000 22,000 - YWCA Domestic Violence 31,817 31,817 - Family Focus 20,000 20,000 - Meals at Home 15,000 15,000 - North Shore Senior Center 13,000 13,000 - Open Studio Art 5,000 5,000 - Interfaith Housing Program - Homeshare 10,000 10,000 - Iwork/hous options 17,500 17,500 - Total Public Services 228,384 228,384 - Total Expenditures 1,753,284$ 2,018,936$ 265,652$ (See independent auditor's report.) - 112 - CITY OF EVANSTON, ILLINOIS Community Development Loan Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Interest -$ 4,656$ 4,656$ Miscellaneous 350,000 208,541 (141,459) Total Revenues 350,000 213,197 (136,803) Expenditures Housing and economic development 350,000 160,641 (189,359) Net Change in Fund Balance -$ 52,556 52,556$ Fund Balances Beginning of Year 158,365 End of Year 210,921$ (See independent auditor's report.) - 113 - CITY OF EVANSTON, ILLINOIS Neighborhood Stabilization Program 2 Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Intergovernmental allotments 198,651$ 91,446$ (107,205)$ Total Revenues 198,651 91,446 (107,205) Expenditures Housing and economic development 194,610 73,823 (120,787) Total Expenditures 194,610 73,823 (120,787) Excess (Deficiency) of Revenues Over Expenditures 4,041 17,623 13,582 Other Financing Sources (Uses) Transfers (out) Transfers to General Fund - (13,279) (13,279) Transfers to Debt Service Fund (4,344) (4,344) - Total Other Financing Sources (Uses)(4,344) (17,623) (13,279) Net Change in Fund Balance (303)$ - 303$ Fund Balances Beginning of Year - Ending of Year -$ (See independent auditor's report.) - 114 - CITY OF EVANSTON, ILLINOIS Special Service District No. 4 Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Property taxes Current year 320,000$ 321,266$ 1,266$ Investment income - 2 2 Total Revenues 320,000 321,268 1,268 Expenditures Housing and economic development 320,000 323,000 3,000 Net Change in Fund Balance -$ (1,732) (1,732)$ Fund Balance Beginning of Year (190,544) End of Year (192,276)$ (See independent auditor's report.) - 115 - CITY OF EVANSTON, ILLINOIS Good Neighbor Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Miscellaneous 1,000,000$ 1,000,000$ -$ Total Revenues 1,000,000 1,000,000 - Expenditures Housing and economic development - - - Excess (Deficiency) of Revenues Over Expenditures 1,000,000 1,000,000 - Other Financing Sources (Uses) Transfers (out)(1,000,000) (1,000,000) - Other Financing Sources (Uses) - Net (1,000,000) (1,000,000) - Net Change in Fund Balance -$ - -$ Fund Balance Beginning of Year - End of Year -$ (See independent auditor's report.) - 116 - CITY OF EVANSTON, ILLINOIS General Assistance Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Property taxes 800,000$ 827,615$ 27,615$ Investment income 1,000 801 (199) Miscellaneous 25,000 49,590 24,590 Total Revenues 826,000 878,006 52,006 Expenditures General management and support 987,833 804,857 (182,976) Net Change in Fund Balance (161,833)$ 73,149 234,982$ Fund Balance Beginning of Year 513,239 Ending 586,388$ (See independent auditor's report.) - 117 - CITY OF EVANSTON, ILLINOIS Capital Improvements Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Intergovernmental allotments 4,841,615$ 2,177,914$ (2,663,701)$ Charges for services - 96,586 96,586 Investment income - 16,690 16,690 Miscellaneous - 1,305 1,305 Contributions - 243,000 243,000 Total Revenues 4,841,615 2,535,495 (2,306,120) Expenditures General management and support - 183,084 183,084 Public safety - 26,000 26,000 Public works 22,279,615 104,970 (22,174,645) Capital outlay - 9,953,056 9,953,056 Debt service Fiscal agent fees - 2,000 2,000 Total Expenditures 22,279,615 10,269,110 (12,010,505) Excess (Deficiency) of Revenues Over Expenditures (17,438,000) (7,733,615) 9,704,385 Other Financing Sources (Uses) Issuance of bonds 9,248,000 8,990,000 (258,000) Premium on issuance of bonds - 357,683 357,683 Transfers in 6,471,000 4,864,055 (1,606,945) Transfers (out)(490,000) (490,000) - Total Other Financing Sources (Uses)15,229,000 13,721,738 (1,507,262) Net Change in Fund Balance (2,209,000)$ 5,988,123 8,197,123$ Fund Balances Beginning of Year 5,517,041 End of Year 11,505,164$ (See independent auditor's report.) - 118 - CITY OF EVANSTON, ILLINOIS Special Assessment Capital Projects Fund Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Revenues Special assessments 230,000$ 168,571$ (61,429)$ Investment income 1,200 3,964 2,764 Total Revenues 231,200 172,535 (58,665) Expenditures Current General management and support - 8,751 8,751 Total Expenditures - 8,751 8,751 Excess (Deficiency) of Revenues Over Expenditures 231,200 163,784 (67,416) Other Financing Sources (Uses) Issuance of bonds 250,000 460,000 210,000 Premium on issuance of bonds - 53,349 53,349 Transfers (out)(382,250) (360,698) 21,552 Other Financing Sources (Uses) - Net (132,250) 152,651 284,901 Net Change in Fund Balance 98,950$ 316,435 217,485$ Fund Balance Beginning of Year 2,682,781 End of Year 2,999,216$ (See independent auditor's report.) - 119 - CITY OF EVANSTON, ILLINOIS Debt Service Funds Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Original and Original and Original and Final Budget Actual Final Budget Actual Final Budget Actual Final Budget Actual Taxes Property taxes -$ (180)$ 75,000$ -$ 210,000$ 223,296$ 1,300,000$ 1,233,675$ Investment income 300 35 - - 500 2 2,000 2,319 Miscellaneous - - - - - - - - Total Revenues 300 (145) 75,000 - 210,500 223,298 1,302,000 1,235,994 Housing and economic development 51,399 5,653 - 1,740,437 200,000 145,004 200,000 131,679 Debt Service Principal 405,000 405,000 - - - - - - Interest 11,872 23,186 43,500 16,556 - - - - Total Expenditures 468,271 433,839 43,500 1,756,993 200,000 145,004 200,000 131,679 Excess (Deficiency) of Revenues Over Expenditures (467,971) (433,984) 31,500 (1,756,993) 10,500 78,294 1,102,000 1,104,315 Issuance of bonds - - - - - - - - Issuance of loans - - - 1,580,000 - - - - Transfers in (out)- General - - - - - - (152,450) (152,450) Capital improvement (1,600,000) (1,589,307) Other - (91,445) - - - - - - Total Other Financing Sources (Uses)- (91,445) - 1,580,000 - - (1,752,450) (1,741,757) Net Changes in Fund Balances (467,971)$ (525,429) 31,500$ (176,993) 10,500$ 78,294 (650,450)$ (637,442) Fund Balances (Deficit) Beginning of Year 525,429 312,070 - 1,281,115 End of Year -$ 135,077$ 78,294$ 643,673$ Expenditures Revenues Service District No. 5 No. 6 Increment District Special Service Area Howard Hartrey TaxChicago Main Tax Increment District Special Other Financing Sources (Uses) - 120 - Original and Original and Original and Original and Original and Final Budget Actual Final Budget Actual Final Budget Actual Final Budget Actual Final Budget Actual 5,145,000$ 4,729,649$ -$ -$ 550,000$ 533,105$ -$ -$ 7,280,000$ 6,719,545$ 2,000 14,012 - - 100 374 150 1,684 5,050 18,426 - - - - 120,000 282,307 - 11,311 120,000 293,618 5,147,000 4,743,661 - - 670,100 815,786 150 12,995 7,405,050 7,031,589 1,500,000 1,105,900 - 971 1,538,000 679,056 - (521) 3,489,399 3,808,179 - - - - - - - - 405,000 405,000 - - 40,000 28,444 600 693 10,000 8,519 105,972 77,398 1,500,000 1,105,900 40,000 29,415 1,538,600 679,749 10,000 7,998 4,000,371 4,290,577 3,647,000 3,637,761 (40,000) (29,415) (868,500) 136,037 (9,850) 4,997 3,404,679 2,741,012 - - 50,000 - 1,000,000 - - - 1,050,000 - - - - - - - - - - 1,580,000 (350,000) (350,000) - - (60,000) (60,000) (30,000) (30,000) (592,450) (592,450) (2,330,000) (393,747) - - - - - - (3,930,000) (1,983,054) (3,607,683) (3,711,768) - - (47,500) (47,500) - - (3,655,183) (3,850,713) (6,287,683) (4,455,515) 50,000 - 892,500 (107,500) (30,000) (30,000) (7,127,633) (4,846,217) (2,640,683)$ (817,754) 10,000$ (29,415) 24,000$ 28,537 (39,850)$ (25,003) (3,722,954)$ (2,105,205) 6,442,430 - (28,621) 442,263 8,974,686 5,624,676$ (29,415)$ (84)$ 417,260$ 6,869,481$ Dempster-Dodge Tax Increment District Washington Increment District Increment District Total Howard Ridge Tax West Evanston Tax Increment District National Tax (See independent auditor's report.) - 121 - ENTERPRISE FUNDS Water Fund - To account for all activity related to providing water to the City’s residents, as well as the Village of Skokie and the Northwest Water Commission. All activities necessary to provide such services are accounted for in this fund, including, but not limited to: administration, operation, maintenance, debt service, and billing/collection. Sewer Fund - To account for all activity related to providing sewer service to the City’s residents and businesses. Activities necessary to provide such service include, but are not limited to: administration, operations, financing, capital improvements/maintenance, and billing/collection. Parking Fund - To account for all city-owned parking facilities/garages, lots, and metered spaces. Maple Avenue and Sherman Plaza Garage activities have been included in this fund beginning in FY09-10. All activities are accounted for including administration, operations, financing, and revenue collection. Solid Waste Fund - To account for all activity related to refuse, recycling, and yard waste collection and disposal. Activities necessary to provide such service include, but are not limited to: administration, operations, and revenue collection. CITY OF EVANSTON, ILLINOIS Water Fund Schedule of Revenues, Expenses, and Changes in Net Position - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Operating Revenues Charges for services 15,083,000$ 15,771,371$ Miscellaneous 510,400 647,309 Total Operating Revenues 15,593,400 16,418,680 Operating Expenses Excluding Depreciation Administration 823,215 1,287,200 Operations Pumping 2,418,793 2,533,997 Filtration 2,587,823 2,426,838 Distribution 2,173,093 1,763,624 Meter maintenance - 408 Other 28,699,484 812,064 Total Operating Expenses Excluding Depreciation 36,702,408 8,824,131 Operating Income (Loss) Before Depreciation (21,109,008) 7,594,549 Depreciation - 1,973,593 Operating Income (Loss)(21,109,008) 5,620,956 Non-Operating Revenue (Expenses) Investment income 1,600 16,537 Interest expense (395,115) (653,059) Net book value of fixed assets disposed - (227,924) Total Non-Operating Revenues (Expenses)(393,515) (864,446) Income (Loss) Before Transfers (21,502,523) 4,756,510 Transfers Transfers (out)(3,369,559) (3,369,559) Total Transfers (3,369,559) (3,369,559) Net Income (Loss)(24,872,082)$ 1,386,951 Net Position Beginning of Year 68,210,727 Change in accounting principle 872,746 Beginning of Year, Restated 69,083,473 End of Year 70,470,424$ (See independent auditor's report.) - 122 - CITY OF EVANSTON, ILLINOIS Water Fund - Operation and Maintenance Account Schedule of Operating Revenues - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Charges for Services, Net Water Sales Evanston 6,848,000$ 7,133,647$ Skokie 2,915,000 2,941,912 Northwest Water Commission 5,320,000 5,695,812 Total Charges for Services 15,083,000 15,771,371 Miscellaneous Fees and outside work 39,000 51,737 Fees, merchandise, and other 471,400 595,572 Total Miscellaneous 510,400 647,309 Total Operating Revenues 15,593,400$ 16,418,680$ (See independent auditor's report.) - 123 - INTERNAL SERVICE FUNDS Fleet Services Fund - To account for the cost of operating the municipal service center maintenance facility for transportation vehicles/equipment used by City departments. Such costs are billed to the user departments. Equipment Replacement Fund - To account for the costs associated with the purchase of vehicles and equipment. Insurance Fund - To account for all costs related to general liability and workers' compensation claims. Beginning with FY10-11, health insurance premiums are also accounted for in this Fund. This internal service fund uses “funding premium” payments from City operating funds to pay claim and premium costs incurred. CITY OF EVANSTON, ILLINOIS Internal Service Funds Combining Statement of Net Position December 31, 2016 Equipment Replacement Fleet Services Insurance Total Current Assets Cash and cash equivalents 1,591,306$ 296,922$ 132,349$ 2,020,577$ Receivables - other 8,645 6,238 - 14,883 Inventories - 881,649 - 881,649 Prepaid items - - 2,437,950 2,437,950 Due from component unit - - 311 311 Due from other funds 22,248 - 422,502 444,750 Total Current Assets 1,622,199 1,184,809 2,993,112 5,800,120 Capital Assets Capital assets being depreciated 23,645,539 617,552 - 24,263,091 Accumulated depreciation (15,422,057) (617,447) - (16,039,504) Total Capital Assets 8,223,482 105 - 8,223,587 Total Assets 9,845,681 1,184,914 2,993,112 14,023,707 Current Liabilities Vouchers payable 366,963 218,729 27,819 613,511 Due to other funds 369,903 23,144 - 393,047 Compensated absences payable - 19,690 6,890 26,580 Claims payable - - 2,269,750 2,269,750 Total Current Liabilities 736,866 261,563 2,304,459 3,302,888 Long-Term Liabilities Compensated absences payable - 78,760 27,558 106,318 OPEB liability - 81,742 - 81,742 Claims payable - - 3,658,120 3,658,120 Total Long-Term Liabilities - 160,502 3,685,678 3,846,180 Total Liabilities 736,866 422,065 5,990,137 7,149,068 Net Position (Deficit) Net investment in capital assets 8,223,482 105 - 8,223,587 Unrestricted (deficit)885,333 762,744 (2,997,025) (1,348,948) Total Net Position (Deficit)9,108,815$ 762,849$ (2,997,025)$ 6,874,639$ (See independent auditor's report.) - 124 - CITY OF EVANSTON, ILLINOIS Internal Service Funds Combining Statement of Revenues, Expenses, and Changes in Net Position For the Fiscal Year Ended December 31, 2016 Equipment Replacement Fleet Services Insurance Total Operating Revenues Charges for services General Fund 1,243,191$ 2,711,059$ 2,681,872$ 6,636,122$ Sewer Fund - 192,213 269,988 462,201 Solid Waste 177,131 322,362 - 499,493 Water Fund - 132,754 468,503 601,257 Motor Vehicle Parking System Fund 30,000 23,783 319,648 373,431 Library Fund 4,743 5,440 - 10,183 Emergency Telephone System - - 17,448 17,448 Economic Development - - 13,962 13,962 Community Development Block Grant 108 69 18,466 18,643 Claims reimbursements - - 96,283 96,283 Health insurance contributions - - 13,181,313 13,181,313 Miscellaneous - 14,415 5,149 19,564 Total Operating Revenues 1,455,173 3,402,095 17,072,632 21,929,900 Operating Expenses General support - 1,072,796 546,211 1,619,007 Major maintenance 102,765 1,905,252 - 2,008,017 General liability claims - - 4,182,715 4,182,715 Workers' compensation claims - - 1,492,491 1,492,491 Health insurance premiums - - 13,474,700 13,474,700 Total Operating Expenses 102,765 2,978,048 19,696,117 22,776,930 Operating Income (Loss) Before Depreciation 1,352,408 424,047 (2,623,485) (847,030) Depreciation 1,624,064 44 - 1,624,108 Operating Income (Loss)(271,656) 424,003 (2,623,485) (2,471,138) Non-Operating Revenue (Expenses) Investment income - - 218 218 Gain on sale of property 63,430 - - 63,430 Total Non-Operating Revenues (Expenses)63,430 - 218 63,648 Income (Loss) Before Transfers (208,226) 424,003 (2,623,267) (2,407,490) Transfers Transfers (out)- (26,762) (9,262) (36,024) Total Transfers - (26,762) (9,262) (36,024) Change in Net Position (208,226) 397,241 (2,632,529) (2,443,514) Net Position (Deficit) - Beginning 9,317,041 365,608 (364,496) 9,318,153 Net Position (Deficit) - Ending 9,108,815$ 762,849$ (2,997,025)$ 6,874,639$ (See independent auditor's report.) - 125 - CITY OF EVANSTON, ILLINOIS Internal Service Funds Combining Statement of Cash Flows For the Fiscal Year Ended December 31, 2016 Equipment Replacement Fleet Services Insurance Total Cash Flows from Operating Activities Receipts from customers and users -$ 14,415$ 13,282,745$ 13,297,160$ Receipts from/(payments for) interfund services provided 1,944,561 3,269,091 4,607,093 9,820,745 Payments to suppliers 322,106 (3,000,979) (3,500,032) (6,178,905) Payments to employees - 41,157 (2,957,328) (2,916,171) Payments for insurance premiums - - (12,474,198) (12,474,198) Net Cash Provided from Operating Activities 2,266,667 323,684 (1,041,720) 1,548,631 Cash Flows from Noncapital Financing Activities Transfers (out)- (26,762) (9,262) (36,024) Net Cash from Noncapital Financing Activities - (26,762) (9,262) (36,024) Cash Flows from Capital and Related Financing Activities Sale of capital assets 65,654 - - 65,654 Acquisition and construction of capital assets (1,810,418) - - (1,810,418) Net Cash from Capital and Related Financing Activities (1,744,764) - - (1,744,764) Cash Flows from Investing Activities Interest income - - 218 218 Net Cash from Investing Activities - - 218 218 Net Increase (Decrease) in Cash and Cash Equivalents 521,903 296,922 (1,050,764) (231,939) Cash and Equivalents Beginning 1,069,403 - 1,183,113 2,252,516 Ending 1,591,306$ 296,922$ 132,349$ 2,020,577$ Reconciliation of Operating Income (Loss) to Net Cash Provided from Operating Activities Operating Income (loss)(271,656)$ 424,003$ (2,623,485)$ (2,471,138)$ Adjustments to reconcile operating income to net cash provided from operating activities Depreciation 1,624,064 44 - 1,624,108 Changes in assets and liabilities Increase/decrease in accounts receivable miscellaneous (8,645) - - (8,645) Interfund receivable 489,388 - 817,206 1,306,594 Prepaid expenses 395,071 - (967,602) (572,531) Inventories - (74,773) - (74,773) Compensated absences - 31,746 5,517 37,263 OPEB liability - 9,411 - 9,411 Vouchers payable 38,445 51,842 26,142 116,429 Interfund payable - (118,589) - (118,589) Claims payable - - 1,700,502 1,700,502 Net Cash Provided from Operating Activities 2,266,667$ 323,684$ (1,041,720)$ 1,548,631$ (See independent auditor's report.) - 126 - COMPONENT UNIT - PUBLIC LIBRARY CITY OF EVANSTON LIBRARY COMPONENT UNIT EVANSTON, ILLINOIS Combining Balance Sheet/Statement of Net Position December 31, 2016 Statement of Operating Endowment Debt Service Total Adjustments Net Position Assets Cash and investments 1,008,869$ 3,811,792$ 370,175$ 5,190,836$ -$ 5,190,836$ Property taxes receivable 6,284,358 - 345,955 6,630,313 - 6,630,313 Other receivables 95 8,065 - 8,160 - 8,160 Due from other governments - - 310,018 310,018 - 310,018 Capital assets not being depreciated - - - - 311,380 311,380 Capital assets net of accumulated depreciation - - - - 12,024,018 12,024,018 Total Assets 7,293,322 3,819,857 1,026,148 12,139,327 12,335,398 24,474,725 Deferred Outflows of Resources Pension items - IMRF - - - - 1,920,319 1,920,319 Total Assets and Deferred Outflows of Resources 7,293,322$ 3,819,857$ 1,026,148$ 12,139,327$ 14,255,717$ 26,395,044$ Liabilities, Deferred Inflows of Resources, and Fund Balance/Net Position Current Liabilities Accounts Payable 164,355$ -$ 484$ 164,839$ -$ 164,839$ Due to Primary Government 193,954 - 650,000 843,954 - 843,954 Total Current Liabilities 358,309 - 650,484 1,008,793 - 1,008,793 Noncurrent Liabilities Due within one year - - - - 459,899 459,899 Due in more than one year - - - - 3,560,190 3,560,190 Total Noncurrent Liabilities - - - - 4,020,089 4,020,089 Total Liabilities 358,309 - 650,484 1,008,793 4,020,089 5,028,882 Deferred Inflows of Resources Unavailable Property Taxes 6,284,358 - 345,955 6,630,313 - 6,630,313 Total Deferred Inflows of Resources 6,284,358 - 345,955 6,630,313 - 6,630,313 Total Liabilities and Deferred Inflows of Resources 6,642,667 - 996,439 7,639,106 4,020,089 11,659,195 Fund Balances/Net Position Net investment in capital assets - - - - 10,365,258 10,365,258 Restricted for debt service - - 29,709 29,709 - 29,709 Restricted for endowment - 3,819,857 - 3,819,857 - 3,819,857 Unassigned/unrestricted 650,655 - - 650,655 (129,630) 521,025 Total Fund Balances/Net Position 650,655 3,819,857 29,709 4,500,221 10,235,628 14,735,849 Total Liabilities, Deferred Inflows, and Fund Balances/Net Position 7,293,322$ 3,819,857$ 1,026,148$ 12,139,327$ 14,255,717$ 26,395,044$ (See independent auditor's report.) - 127 - CITY OF EVANSTON LIBRARY COMPONENT UNIT EVANSTON, ILLINOIS Combining Statement of Revenues, Expenditures, and Changes in Fund Balances/Statement of Activities Governmental Fund For Fiscal Year Ended December 31, 2016 Statement of Operating Endowment Debt Service Total Adjustments Activities Revenues Property taxes 6,136,248$ -$ 364,827$ 6,501,075$ -$ 6,501,075$ Intergovernmental Personal property replacement tax 4,141 - - 4,141 - 4,141 Grant revenue 89,668 - - 89,668 - 89,668 Charges for services 324,776 - 113 324,889 - 324,889 Fines and forfeits 152,537 - - 152,537 - 152,537 Other Investment income 4,717 293,132 - 297,849 - 297,849 Donations 67,943 18,000 - 85,943 - 85,943 Total Revenues 6,780,030 311,132 364,940 7,456,102 - 7,456,102 Expenditures Current Community services 6,785,260 - - 6,785,260 1,025,002 7,810,262 Debt Service Payment Primary Government - - 650,000 650,000 - 650,000 Principal - - 323,241 323,241 (323,241) - Interest and fiscal charges - - 74,804 74,804 (26,150) 48,654 Total Expenditures 6,785,260 - 1,048,045 7,833,305 675,611 8,508,916 Excess (Deficiency) or Revenues Over Expenditures (5,230) 311,132 (683,105) (377,203) (675,611) (1,052,814) Other Financing Sources (Uses) Issuance of bonds - - 650,000 650,000 (650,000) - Premium on bond issuances - - 26,150 26,150 (26,150) - Transfer in 235,800 - - 235,800 (235,800) - Transfer (out)- (235,800) - (235,800) 235,800 - Total Other Financing Sources (Uses)235,800 (235,800) 676,150 676,150 (676,150) - Change in Fund Balance/Net Position 230,570 75,332 (6,955) 298,947 (1,351,761) (1,052,814) Fund Balances/Net Position Beginning of Year 420,085 3,744,525 36,664 4,201,274 10,876,356 15,077,630 Change in accounting principle - - - - 711,033 711,033 Beginning of Year, Restated 420,085 3,744,525 36,664 4,201,274 11,587,389 15,788,663 End of Year 650,655$ 3,819,857$ 29,709$ 4,500,221$ 10,235,628$ 14,735,849$ (See independent auditor's report.) - 128 - CITY OF EVANSTON LIBRARY COMPONENT UNIT EVANSTON, ILLINOIS Library Operating Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended December 31, 2016 Original and Final Budget Actual Variance Taxes Property taxes 6,104,180$ 6,136,248$ 32,068$ Intergovernmental Personal property replacement tax 50,200 4,141 (46,059) Grant revenue 114,177 89,668 (24,509) Charges for services 313,300 324,776 11,476 Fines and forfeits 160,000 152,537 (7,463) Other Investment income 2,000 4,717 2,717 Donations 87,500 67,943 (19,557) Total Revenues 6,831,357 6,780,030 (51,327) General management and support 6,667,053 6,785,260 118,207 Total Expenditures 6,667,053 6,785,260 118,207 Excess (Deficiency) of Revenues Over Expenditures 164,304 (5,230) (169,534) Transfers in 185,000 235,800 50,800 Transfers (out) (330,089) - 330,089 Total Other Financing Sources (Uses)(145,089) 235,800 380,889 Net Changes in Fund Balances 19,215$ 230,570 211,355$ Fund Balances Beginning of Year 420,085 End of Year 650,655$ Revenues Expenditures Other Financing Sources (Uses) (See independent auditor's report.) - 129 - STATISTICAL SECTION This part of the City of Evanston, Illinois’ comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information displays about the City’s overall financial health. ’s financial performance and well ’s ’s current levels of outstanding debt and the ’s ’s financial ’s financial report relates to the Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year. CITY OF EVANSTON, ILLINOIS Net Position by Component Last Ten Fiscal Years (accrual basis of accounting) (amounts expressed in thousands) 2008 2009 2010 2011 2011*2012 2013 2014 2015**2016 Governmental Activities Net investment in capital assets 31,542$ 37,278$ 41,109$ 49,483$ 57,663$ 60,105$ 47,214$ 46,633$ 47,953$ 51,588$ Restricted 23,168 26,238 23,645 23,187 31,559 31,754 24,720 25,446 16,409 18,523 Unrestricted 28,231 17,539 10,400 4,072 (24,033) (23,729) (13,846) (11,436) (136,007) (170,270) Total Governmental Activities Net Position 82,941$ 81,055$ 75,154$ 76,742$ 65,189$ 68,130$ 58,088$ 60,643$ (71,645)$ (100,159)$ Business-Type Activities Net investment in capital assets 159,185$ 172,399$ 192,921$ 207,162$ 215,755$ 228,738$ 239,243$ 246,382$ 255,622$ 268,851$ Restricted 1,986 1,987 3,378 1,624 1,034 710 712 649 - - Unrestricted 23,589 27,586 25,417 19,141 25,385 26,363 25,484 23,563 22,785 18,928 Total Business-Type Activities Net Position 184,760$ 201,972$ 221,716$ 227,927$ 242,174$ 255,811$ 265,439$ 270,594$ 278,407$ 287,779$ Primary Government Net investment in capital assets 190,727$ 209,677$ 234,030$ 256,645$ 273,418$ 288,843$ 286,457$ 293,015$ 303,575$ 320,439$ Restricted 25,154 28,225 27,023 24,811 32,593 32,464 25,432 26,095 16,409 18,523 Unrestricted 51,820 45,125 35,817 23,213 1,352 2,634 11,638 12,127 (113,222) (151,342) Total Primary Government Net Position 267,701$ 283,027$ 296,870$ 304,669$ 307,363$ 323,941$ 323,527$ 331,237$ 206,762$ 187,620$ * The City changed its fiscal year end to December 31, 2011. ** The City implemented GASB Statemetn No. 68 which resulted in a decrease in unrestricted net position Source: City Finance Division - 130 - CITY OF EVANSTON, ILLINOIS Changes in Net Position Last Ten Fiscal Years (amounts expressed in thousands) 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Expenses Governmental Activities General government 20,072$ 18,017$ 19,773$ 17,517$ 17,911$ 22,508$ 18,892$ 13,811$ 12,493$ 18,163$ Public safety 48,763 49,484 50,488 53,226 43,465 52,740 57,090 58,795 57,443 55,625 Public works 21,566 21,628 18,509 15,626 12,399 11,099 13,782 25,825 20,011 13,668 Health and human resource development 4,982 4,546 4,760 4,541 3,547 3,200 3,601 3,837 2,911 3,319 Housing and economic development 7,090 6,965 20,066 10,857 11,630 19,101 11,123 12,443 10,532 21,063 Culture and recreation 20,634 20,002 9,120 20,142 15,607 17,438 16,433 9,358 14,794 14,380 Interest on long-term debt 5,522 4,041 4,396 5,595 3,114 1,786 377 3,919 3,757 3,779 Total governmental activities expenses 128,629 124,683 127,112 127,504 107,673 127,872 121,298 127,988 121,941 129,997 Business-Type Activities Water 8,668 9,391 9,133 8,713 7,450 10,172 11,193 11,977 10,748 11,450 Sewer 8,972 8,726 8,779 8,784 7,083 7,872 7,649 7,293 6,608 6,683 Solid waste - - - - 4,317 4,612 4,732 4,856 5,150 4,967 Motor vehicle parking system 2,403 8,896 8,841 8,425 6,673 8,297 8,369 7,856 7,862 8,532 Sherman garage 4,270 - - - - - - - - - Maple avenue garage 2,682 - - - - - - - - - Total Business-Type Activities 26,995 27,013 26,753 25,922 25,523 30,953 31,943 31,982 30,368 31,632 Total primary government expenses 155,625$ 151,696$ 153,865$ 153,426$ 133,196$ 158,825$ 153,241$ 159,970$ 152,309$ 161,629$ Program Revenues Governmental Activities Charges for services General government 12,639$ 13,348$ 13,087$ 12,796$ 9,219$ 9,478$ 8,917$ 9,374$ 8,629$ 10,094$ Culture and recreation 4,521 4,637 4,902 5,265 4,587 9,934 5,236 5,360 5,572 5,560 Other activities 14,518 10,289 7,946 9,377 8,523 11,349 12,179 15,253 11,268 15,739 Operating grants and contributions 5,982 5,117 5,898 9,851 9,861 13,453 10,102 7,151 5,535 6,809 Capital grants and contributions 118 113 4,037 8,026 3,941 2,017 2,956 501 275 368 Total Governmental Activities Program Revenues 37,778 33,504 35,870 45,315 36,131 46,231 39,390 37,639 31,279 38,570 - 131 - 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Business-Type Activities Charges for services Water 13,239$ 13,685$ 12,694$ 13,738$ 12,369$ 14,967$ 14,658$ 15,052$ 15,722$ 16,419$ Sewer 14,239 13,774 13,243 13,393 11,377 14,115 13,510 12,785 12,511 13,049 Sherman garage 1,950 - - - - - - - - - Solid waste - - - - 2,900 3,490 3,651 3,971 4,004 4,031 Motor vehicle parking system 3,084 6,719 6,772 5,987 4,928 6,663 6,255 6,080 6,164 6,688 Maple avenue garage fund 1,430 - - - - - - - - - Operating grants and contributions - - - - - 395 939 15 - - Total Business-Type Activities Program Revenues 33,942 34,178 32,709 33,118 31,574 39,630 39,013 37,903 38,401 40,187 Total Primary Government Program Revenues 71,720$ 67,682$ 68,579$ 78,433$ 67,705$ 85,861$ 78,403$ 75,542$ 69,680$ 78,757$ Net (Expense)/Revenue Governmental Activities (90,851)$ (91,179)$ (91,242)$ (82,189)$ (71,542)$ (81,641)$ (81,908)$ (90,349)$ (90,662)$ (91,427)$ Business-Type Activities 6,946 7,165 5,956 7,196 6,051 8,677 7,070 5,921 8,033 8,555 Total Primary Government Net Expense (83,905)$ (84,014)$ (85,286)$ (74,993)$ (65,491)$ (72,964)$ (74,838)$ (84,428)$ (82,629)$ (82,872)$ General Revenues and Other Changes in Net Position Governmental Activities Taxes Property taxes 46,947$ 56,217$ 58,839$ 47,040$ 33,399$ 47,874$ 46,349$ 48,579$ 45,840$ 45,610$ Sales taxes 16,172 15,500 14,880 15,577 13,495 15,888 16,965 17,362 17,758 17,932 Investment earnings 3,653 360 721 557 32 398 79 (258) 30 118 Miscellaneous 25,799 26,684 24,601 27,501 21,244 25,348 27,369 26,612 30,950 33,217 Transfers (5,116) (9,469) (13,700) (99) (8,180) (4,926) (2,586) 610 631 434 Total Governmental Activities 87,455 89,292 85,341 90,576 59,990 84,582 88,176 92,905 95,209 97,311 Business-Type Activities Investment earnings 1,287 606 87 23 16 34 33 (156) 27 59 Miscellaneous - (28) - - - - (61) - 301 (245) Transfers 5,116 9,469 13,700 99 8,180 4,926 2,586 (610) (631) (434) Total Business-Type Activities 6,403 10,047 13,787 122 8,196 4,960 2,558 (766) (303) (620) Changes in Net Position Governmental Activities (3,396) (1,887) (5,901) 8,387 (11,552) 2,941 6,268 2,556 4,547 5,884 Business-Type Activities 13,349 17,212 19,743 7,318 14,247 13,637 9,628 5,155 7,730 7,935 Total Primary Government 9,953$ 15,325$ 13,842$ 15,705$ 2,695$ 16,578$ 15,896$ 7,711$ 12,277$ 13,819$ * The City changed its fiscal year end to December 31, 2011. Source: City Finance Division - 132 - CITY OF EVANSTON, ILLINOIS Fund Balances, Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 General Fund Nonspendable - - - - - - - - 118 -$ Reserved/Restricted 1,108 1,275 1,585 1,995 - - - - - - Unreserved/Restricted 24,840 19,752 18,603 20,009 - - - - - - Assigned - - - - 7,590 6,848 6,362 5,347 5,672 5,046 Unassigned - - - - 10,803 10,186 10,001 9,636 4,914 6,622 Total General Fund 25,948$ 21,027$ 20,188$ 22,004$ 18,393$ 17,034$ 16,363$ 14,983$ 10,586$ 11,668$ All Other Governmental Funds Reserved 29,739$ 31,757$ 28,953$ 28,738$ -$ -$ -$ -$ -$ -$ Unreserved, reported in Special Revenue Funds 6,649 10,356 10,807 10,907 - - - - - - Capital Projects Funds 25,620 20,899 9,276 9,665 - - - - - - Nonspendable - - - - 1,419 - 407 1,430 2,158 - Restricted - - - - 32,353 32,431 25,359 26,003 16,409 18,523 Committed - - - - 806 2,150 3,507 3,540 2,556 2,996 Assigned - - - - 10,074 5,307 8,372 10,467 5,517 7,668 Unassigned - - - - (175) 1,105 (149) (153) (221) (252) Total All Other Governmental Funds 62,008$ 63,012$ 49,036$ 49,310$ 44,477$ 40,993$ 37,496$ 41,287$ 26,419$ 28,935$ * The City changed its fiscal year end to December 31, 2011. Notes: Fund balances for debt service have been included in the reserved amounts. 1. Fund balances for debt service have been included in the reserved amounts. 2. Starting fiscal year ending December 31, 2011, financials are presented per the new reporting standards of GASB 54. Source: City Finance Division - 133 - CITY OF EVANSTON, ILLINOIS Changes in Fund Balances, Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Revenues Taxes 75,767$ 84,035$ 84,726$ 73,559$ 56,466$ 79,331$ 78,254$ 77,933$ 75,747$ 76,047$ Licenses, fees and permits 10,276 8,820 7,279 8,661 6,776 10,470 10,617 14,503 12,184 17,933 Fines and penalties 4,660 4,442 4,151 4,003 3,280 3,470 3,449 3,358 148 3,612 Charges for services 7,732 8,399 8,680 9,786 6,283 7,763 7,723 7,793 23,834 8,791 Special assessments 520 516 240 429 235 293 275 167 8,312 169 Intergovernmental 22,625 21,013 20,696 26,456 23,183 29,252 27,844 24,300 3,554 24,886 Investment earnings 3,402 272 714 555 22 397 94 89 30 118 Other Revenues 5,116 4,679 4,642 6,390 4,133 2,915 1,906 1,791 1,722 3,892 Total Revenues 130,098 132,176 131,128 129,839 100,378 133,891 130,162 129,934 125,531 135,448 Expenditures General government 18,190 16,498 16,184 23,463 13,594 18,532 17,611 13,314 13,444 17,064 Public safety 42,466 49,999 48,970 50,352 42,140 54,611 56,431 59,425 59,654 62,252 Public works 18,868 18,913 16,062 14,053 7,574 9,380 11,982 19,821 19,815 13,477 Recreation and cultural opportunities 19,118 18,942 18,100 17,399 16,192 14,309 14,775 10,524 11,087 11,894 Health and human development 4,982 4,546 4,760 4,541 3,588 3,200 3,601 3,837 3,141 3,021 Housing and economic development 7,089 6,963 9,120 11,345 11,999 19,095 11,305 9,348 13,292 10,477 Pensions - - - - - - - - - - Capital outlay 12,416 8,209 7,960 7,112 5,832 8,523 5,948 6,286 9,151 9,953 Debt service - - Interest 5,128 5,143 4,953 4,878 4,384 5,175 4,996 4,411 4,413 4,276 Fiscal agent fees 42 28 5 12 79 76 127 43 16 14 Principal 10,815 9,885 7,524 7,650 10,106 13,055 34,259 10,040 20,833 19,661 Total Governmental Activities Expenditure 139,114 139,126 133,638 140,805 115,488 145,956 161,035 137,049 154,846 152,089 Net (Expense)/Revenue Governmental Activities (9,016) (6,950) (2,510) (10,966) (15,110) (12,065) (30,873) (7,115) (29,315) (16,641) - 134 - 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Other Financing Sources (Uses) Proceeds from borrowing 31,444$ 24,340$ -$ 13,393$ 15,420$ 12,618$ 34,982$ 9,989$ 22,377$ 19,652$ Capitalized interest income - 839 - 120 - - - - - - Capitalized interest expense - - - - - - - - - - Escrow funding (15,590) (13,280) - - - - - - - - Transfers in 8,975 5,927 11,019 5,727 5,839 9,271 8,182 9,202 10,308 16,011 Transfers (out)(15,344) (14,794) (23,324) (6,184) (14,593) (14,668) (11,879) (9,665) (9,315) (15,542) Total Other Financing Sources (Uses)9,485 3,032 (12,305) 13,056 6,666 7,221 31,285 9,526 23,370 20,121 Net Changes in Fund Balance 469$ (3,917)$ (14,815)$ 2,090$ (8,444)$ (4,844)$ 412$ 2,411$ (5,945)$ 3,480$ Debt Service as a Percentage of Noncapital Expenditures 12.58%11.48%9.93%9.36%13.29%13.26%25.31%11.05%17.62%16.84% * The City changed its fiscal year end to December 31, 2011. Source: City Finance Division - 135 - CITY OF EVANSTON, ILLINOIS Equalized Assessed Value and Actual Value of Taxable Property Last Ten Levy Years Levy Total Total Total Year Residential Farm Commercial Industrial Railroad Equalized Actual Tax Ended Property Property Property Property Property Assessed Value Value Rate 2006 1,707,669,215$ 16,895$ 476,821,737$ 60,920,888$ 464,011$ 2,245,892,746$ 6,737,678,238$ 1.527$ 2007 2,149,123,958 16,895 560,536,782 62,154,048 508,346 2,772,340,029 8,317,020,087 1.283 2008 2,324,551,100 16,895 560,106,493 53,168,671 554,733 2,938,397,892 8,815,193,676 1.295 2009 2,564,394,619 15,956 615,808,511 125,104,411 665,872 3,305,989,369 9,917,968,107 1.204 2010 2,233,194,054 15,956 623,156,869 184,687,438 829,769 3,041,884,086 9,125,652,258 1.364 2011 2,100,690,657 15,956 513,880,731 111,899,205 881,024 2,727,367,573 8,182,102,719 1.591 2012 1,944,932,067 15,956 462,671,239 106,007,084 995,206 2,514,621,552 7,543,864,656 1.551 2013 1,653,524,481 15,956 452,108,891 94,820,879 1,226,831 2,201,697,038 6,605,091,114 1.760 2014 1,792,383,435 15,467 416,165,953 34,726,327 1,278,793 2,244,569,975 6,733,709,925 1.856 2015 1,751,252,888 15,467 410,670,248 32,549,681 1,533,241 2,196,021,525 6,588,064,575 1.766 Source: Note:Property is reassessed once every three years.Equalized Assessed value is approximately 1/3 of actual value.Tax rates are per $100 of equalized assessed value. - 136 - CITY OF EVANSTON, ILLINOIS Principal Property Taxpayers Current Year and Nine Years Ago 2015 Levy 2006 Levy Percentage Percentage Total of Total City Total of Total City Equalized Assessed Taxable Equalized Assessed Taxable Tax Payer Value (EAV)Rank EAV Tax Payer Value (EAV)Rank EAV Rotary International 25,179,949$ 1 1.15%Golub & Company 28,624,653$ 1 1.28% FSP 909 Davis Street 19,966,576 2 0.91%REP CBRE 21,727,776 2 0.97% Lowe Enterprises 17,461,023 3 0.80%Rotary International 21,523,423 3 0.96% McCaffery Interests 15,310,340 4 0.70%Church Street Plaza 17,921,581 4 0.80% Evanston Hotel Assoc.9,784,205 5 0.45%Church & Chicago Ltd Partnership 15,878,114 5 0.71% Inland 9,759,474 6 0.44%Omni Orrington Hotel 13,391,021 6 0.60% Northshore University Health 9,556,069 7 0.44%Evanston Plaza Freed 13,300,351 7 0.59% Azurri of Evanston 8,476,109 8 0.39%Evanstone Hotel Assoc.12,361,644 8 0.55% Target Proptax T927 7,336,363 9 0.33%Albertson's (Jewel & Osco)10,650,893 9 0.47% 1007 Chruch St LLC 7,279,722 10 0.33%Kap Sum Properties LLC 9,792,045 10 0.44% Total 130,109,831$ 5.92% Total 165,171,501$ 7.36% Total EAV 2,196,021,525$ Total EAV 2,242,753,022$ Source: Cook County - 137 - CITY OF EVANSTON, ILLINOIS Property Tax Levies and Collections Last Ten Levy Years Tax Taxes Levied Collected Receipts Collections Total Collected to Date Levy for the Percentage in Subsequent Percentage Year Fiscal Year Amount of Levy Years Amount of Levy 2006 34,399,146$ 33,249,612$ 96.66%437,287$ 33,686,899$ 97.93% 2007 35,550,694 34,061,461 95.81%400,850 34,462,311 96.94% 2008 38,044,671 36,246,629 95.27%358,214 36,604,843 96.22% 2009 39,779,364 38,018,159 95.57%464,506 38,482,665 96.74% 2010 41,479,398 39,412,004 95.02%764,463 40,176,467 96.86% 2011 43,397,590 42,064,756 96.93%348,189 42,412,945 97.73% 2012 43,330,121 41,776,375 96.41%559,130 42,335,505 97.70% 2013 43,869,798 42,762,685 97.48%338,420 43,101,105 98.25% 2014 45,557,079 44,280,493 97.20%270,619 44,551,112 97.79% 2015 46,394,914 44,974,845 96.94%205,607 45,180,452 97.38% 2016 47,538,529 See Note See Note See Note See Note See Note Note: Levy Year 2016 is collected beyond fiscal year end 2016 through December 31, 2017. Source: City Finance Division - 138 - CITY OF EVANSTON, ILLINOIS Ratio of General Bonded Debt Outstanding Last Ten Fiscal Years (2)Net Gross (3)Net Net General (1)General Debt Debt Net Debt to Debt to Obligation Fiscal Equalized Obligation Service Payable General Total Equalized Total Bonded Year Assessed Bonded Monies From Other Obligation Personal Assessed Personal Debt Ended Population Valuation Debt Available Revenues Debt Income Valuation Income Per Capita 2007 74,239 2,242,753,022$ 187,745,000$ 6,504,507$ 96,780,000$ 84,460,493$ 2,902,967,617$ 3.77%2.91%1,137.68$ 2008 74,239 2,245,892,746 181,750,000 6,146,567 81,455,000 94,148,433 2,902,967,617 4.19%3.24%1,268.18 2009 74,239 2,772,340,029 171,945,001 7,317,930 62,079,183 102,547,888 2,902,967,617 3.70%3.53%1,381.32 2010 74,239 2,938,397,892 149,315,000 5,989,400 46,882,320 96,443,280 2,902,967,617 3.28%3.32%1,299.09 2011 74,486 3,305,989,369 151,695,000 5,309,064 50,097,260 96,288,676 3,157,759,484 2.91%3.05%1,292.71 2011*74,486 3,041,884,087 155,855,000 2,629,020 47,111,060 106,114,920 3,197,311,550 3.49%3.32%1,424.63 2012 74,486 2,727,367,573 152,644,999 16,085,747 44,899,176 91,660,076 3,176,902,386 3.36%2.89%1,230.57 2013 74,619 2,514,621,552 149,534,997 12,520,761 40,042,921 96,971,315 3,113,477,775 3.86%3.11%1,299.55 2014 75,570 2,201,697,038 150,421,841 12,209,139 34,614,357 103,598,345 3,262,734,750 4.71%3.18%1,370.89 2015 75,570 2,244,569,975 150,069,048 438,453 37,651,325 111,979,270 3,124,063,800 4.99%3.58%1,481.80 2016 75,603 2,196,021,525 147,069,822 - 39,345,321 107,724,501 3,235,052,370 4.91%3.33%1,424.87 * The City changed its fiscal year end to December 31, 2011. Notes: (1) (2)Excludes limited purpose special service district bonds. (3) Source: Cook County and City Finance Division Equalized assessed values do not include tax increment financing district incremental equalized assessed values. These amounts include the general obligation bonds that are being repaid from the Water Fund,Solid Waste Fund,Sewer Fund,Motor Vehicle Parking System Fund, Howard Hartrey Tax Increment District, Washington National Tax Increment District, and Special Assessment Fund. - 139 - CITY OF EVANSTON, ILLINOIS Ratio of Outstanding Debt by Type Last Ten Fiscal Years Fiscal General Special General Water Total Percentage (1) Year Obligation Service District Obligation Revenue IEPA Primary of Personal Per Ended Bonds Bonds Capital Lease Bonds Bonds Loans Government Income Capita 2007 110,920,000$ 3,070,000$ -$ 76,825,000$ 3,240,000$ 99,490,921$ 293,545,921$ 10.11%3,954$ 2008 115,220,000 2,785,000 - 66,530,000 2,755,000 103,410,887 290,700,887 10.01%3,916 2009 115,961,136 2,165,000 1,035,370 55,983,865 2,245,000 101,775,223 279,165,594 9.62%3,760 2010 109,078,880 2,155,000 708,552 40,236,120 1,720,000 95,370,544 249,269,096 8.59%3,358 2011 115,482,439 1,840,000 363,759 36,212,561 1,170,000 87,059,150 242,127,909 7.67%3,251 2011*120,739,206 1,840,000 - 35,115,794 1,170,000 79,081,272 237,946,272 7.44%3,195 2012 119,423,742 1,515,000 - 33,221,257 595,000 70,375,368 225,130,367 7.09%3,022 2013 119,123,639 1,175,000 - 30,411,358 305,000 64,658,382 215,673,379 6.93%2,890 2014 119,060,744 795,000 - 30,566,097 - 58,412,659 208,834,500 6.40%2,763 2015 117,752,440 405,000 - 31,911,608 - 51,901,172 209,138,551 6.69%2,767 2016 116,143,472 - - 30,926,350 - 45,256,237 192,326,059 5.95%2,544 * The City changed its fiscal year end to December 31, 2011. Notes: Source: City Finance Division Governmental Activities Business-Type Activities (1) Details regarding the City's outstanding debt can be found in the notes to the financial statements. (2) See the Schedule of Demographic and Economic Statistics for personal income and population data. - 140 - CITY OF EVANSTON, ILLINOIS Direct and Overlapping Governmental Activities Debt As of December 31, 2016 Percentage of Debt The City's Total Applicable Share of Debt Outstanding to the City (1) Direct debt - bonds, notes, and contracts outstanding 112,107,778$ 100.00%112,107,778$ Other bonded debt by taxing body County of Cook 3,511,877,504 1.71%60,152,294 Cook County Forest Preserve District 168,670,000 1.71%2,889,021 Metropolitan Water Reclamation District 2,769,608,000 1.69%46,676,090 Community College District 535 33,175,000 11.44%3,796,025 High School District 202 26,640,464 90.18%24,024,035 School District 65 80,168,206 90.18%72,294,678 Skokie Park District 6,862,000 63.00%4,323,060 Total Overlapping Debt 6,597,001,174 214,155,204 6,709,108,952$ 326,262,982$ Note: Overlapping debt calculated based on the pro rata EAV. Source: Cook County Clerk's Offices - 141 - CITY OF EVANSTON, ILLINOIS Legal Debt Margin December 31, 2016 The City is a home rule municipality. To date, the Illinois General Assembly has set no limits for home rule municipalities. “The General Assembly may limit by law the amount and require referendum approval of debt to be incurred by home rule municipalities,payable from ad valorem property tax receipts,only in excess of the following percentages of the assessed value of its taxable property...(2)if its population is more than 25,000 and less than 500,000 an aggregate of one percent...indebtedness which is outstanding on the effective date (July 1,1971)of this constitution or which is thereafter approved by referendum...shall not be included in the foregoing percentage amounts.” Chapter 65, Section 5/8-5-1 of the Illinois Compiled Statutes governs computation of the legal debt margin. - 142 - CITY OF EVANSTON, ILLINOIS Pledged-Revenue Coverage Last Ten Fiscal Years Water Revenue Bonds Utility Less:Net Fiscal Year Service Operating Available Debt Service Ended Charges Expenses Resources Principal Interest Coverage 2008 13,787,014$ 7,138,056$ 6,648,958$ 485,000$ 128,713$ 10.83 2009 13,878,833 7,866,909 6,011,924 510,000 110,913 9.68 2010 12,742,603 7,756,760 4,985,843 525,000 91,556 8.09 2011 13,752,681 7,191,577 6,561,104 550,000 71,269 10.56 2011*12,368,533 6,146,652 6,221,881 - 24,672 252.18 2012 14,967,204 8,430,599 6,536,605 575,000 37,687 10.67 2013 14,657,748 8,175,707 6,482,041 290,000 19,688 20.93 2014 15,051,732 7,938,838 7,112,894 305,000 6,672 22.82 2015 NA NA NA - - NA 2016 NA NA NA - - NA N/A - The City has no revenue bonds outstanding after December 31, 2014. * The City changed its fiscal year end to December 31, 2011. Source: Various City departments Note:Detail regarding the City's outstanding debt can be found in the notes to the financial statements. Operating expenses do not include interest, depreciation, or amortization expense. - 143 - CITY OF EVANSTON, ILLINOIS Demographic and Economic Statistics Last Ten Years Per Education Total Capita % of Population Calendar Personal Personal Median with HS Diploma School Unemployment Year Population Income Income Age or Higher Enrollment Rate 2007 74,239 2,902,967,617$ 39,103$ 32.5 94.0%9,550 4.4% 2008 74,239 2,902,967,617 39,103 32.5 94.0%9,550 4.6% 2009 74,239 2,902,967,617 39,103 32.5 94.0%9,550 4.7% 2010 74,486 3,157,759,484 42,394 34.3 94.0%9,550 7.9% 2011 74,486 3,197,311,550 42,925 34.3 94.0%11,369 7.3% 2012 74,486 3,176,902,386 42,651 35.1 93.6%11,418 6.8% 2013 74,619 3,113,477,775 41,725 34.4 93.9%10,293 6.7% 2014 75,570 3,262,734,750 43,175 34.4 93.9%10,429 4.2% 2015 75,570 3,124,063,800 41,340 34.4 93.9%11,088 4.5% 2016 75,603 3,235,052,370 42,790 35.2 94.0%12,104 4.3% Source: Various Government agencies - 144 - CITY OF EVANSTON, ILLINOIS Principal Employers Current Year and Nine Years Ago Employer Employees %Rank Employer Employees %Rank Northwestern University 7,333 44%1 Northwestern University 5,325 36%1 Northshore University Healthcare 4,114 25%2 Evanston Northwestern Healthcare 3,780 26%2 Evanston School District 65 1,137 7%3 St. Francis Hospital 1,649 11%3 St. Francis Hospital 1,000 6%4 City of Evanston 865 6%4 City of Evanston 824 5%5 Evanston School District 65 700 5%5 Presbyterian Homes/McGaw Care 490 3%6 Evanston Township High School 566 4%6 School District 202 575 3%7 Presbyterian Homes/McGaw Care 533 4%7 Rotary International 533 2%8 Rotary International 460 3%8 C.E. Neifhoff & Co.350 2%9 Jewel/Osco Food Store 455 3%9 Whole Foods 300 2%10 Mather LifeWays Retirement 430 3%10 Total 16,656 Total 14,763 Source: City Economic Development Division 2016 2007 - 145 - CITY OF EVANSTON, ILLINOIS Full-Time Equivalent City Government Employees by Function Last Ten Fiscal Years 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Function/Program General Government City Clerk 2.00 2.00 2.00 2.00 3.00 2.80 2.20 2.20 2.00 2.00 City Manager's Office 13.70 31.53 27.70 22.00 8.00 12.00 12.00 14.00 13.00 19.00 MBIS / IT 25.50 - - 13.00 12.00 11.50 9.00 11.00 12.00 11.00 Legal 7.00 7.00 6.00 7.00 7.00 7.00 8.00 7.00 8.00 8.00 Human Resources 8.00 8.00 8.00 5.00 5.00 7.50 8.00 8.50 6.50 6.50 Finance 26.50 29.50 28.50 19.50 19.00 17.10 17.00 17.50 20.50 18.00 Parking Systems - - - 13.00 12.00 12.00 9.00 12.00 12.00 12.00 Facilities Management - - - - 19.00 20.20 16.00 - 20.20 Community Development 36.00 35.00 33.00 28.00 27.00 27.00 24.00 21.00 19.00 21.50 Community College District 535 Police 220.75 220.75 218.50 219.00 222.00 225.00 220.00 227.00 227.00 230.80 Fire 111.00 112.00 111.00 107.00 108.00 110.00 106.00 110.00 110.00 110.00 Human and Health Services 29.68 24.90 26.40 15.90 17.00 17.70 20.00 21.10 22.10 21.10 Public Works 108.45 105.45 83.25 58.80 49.00 49.25 97.00 108.45 107.45 84.25 Recreation, Parks, and Forestry 115.90 112.75 131.75 132.00 105.00 105.21 69.00 69.64 74.23 77.13 Total General Government 704.48 688.88 676.10 642.20 613.00 624.26 617.20 629.39 633.78 641.48 Library 66.69 69.35 67.50 52.00 52.00 56.38 63.00 63.13 66.87 66.87 Neighborhood Stabilization Program - - - 1.00 1.00 2.00 1.00 1.31 0.50 0.45 Housing Rehabilitation - - - - - - - - 1.75 1.75 General Assistance Fund - - - - - - - - 4.00 4.00 HOME Fund - - - - - - - - 0.40 0.50 Emergency Telephone System 4.00 4.00 5.00 5.00 5.00 5.00 4.00 5.00 5.00 5.00 CDBG 2.00 2.00 2.00 2.00 3.00 1.53 3.00 2.60 2.60 2.80 Economic Development Fund 1.30 2.30 2.30 5.00 6.00 7.00 5.00 6.25 6.25 5.75 Downtown II TIF Fund - - - - - - - - - - Capital Improvements Fund - - - 1.00 - - - - - - Maple Ave. Garage 1.00 1.00 - - - - - - - - Parking Fund 14.50 14.50 15.50 14.00 15.00 15.50 15.50 15.50 15.50 15.50 Source: City Finance division - - - - - - - - - - Water 43.00 43.00 43.00 42.00 41.00 42.50 40.00 42.50 44.50 44.50 Sewer 14.00 14.00 14.00 12.00 11.00 13.00 11.00 13.33 11.33 11.33 Solid Waste - - - - 6.00 10.00 8.00 9.66 9.66 9.66 Fleet Services 15.00 15.00 15.00 11.00 12.00 12.00 10.00 12.00 12.50 12.50 Insurance Fund 1.00 2.00 2.00 3.00 4.00 4.00 4.00 5.00 5.00 5.00 Total Other Functions 162.49 167.15 166.30 148.00 156.00 168.91 164.50 176.28 185.86 118.74 Total All Funds 866.97 856.03 842.40 790.20 769.00 793.17 781.70 805.67 819.64 760.22 * The City changed its fiscal year end to December 31, 2011. Source: City of Evanston HR Division - 146 - CITY OF EVANSTON, ILLINOIS Property Tax Rates per $100 - Direct and Overlapping Governments Last Ten Levy Years 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 City of Evanston 1.283 1.295 1.204 1.365 1.592 1.551 1.760 1.856 1.766 1.762 Consolidated Elections 0.012 - 0.021 - 0.025 - - - - - Cook County 0.446 0.415 0.394 0.423 0.462 0.531 0.560 0.591 0.568 0.552 Cook County Forest Preserve District 0.053 0.051 0.049 0.051 0.058 0.063 0.069 0.073 0.069 0.069 Suburban T.B. Sanitarium - - - - - - - - - - Metropolitan Water Reclamation District 0.263 0.252 0.261 0.274 0.320 0.370 0.417 0.440 0.430 0.426 North Shore Mosquito Abatement District 0.008 0.008 0.008 0.009 0.010 0.010 0.007 0.007 0.011 0.012 Evanston Township 0.050 0.050 0.042 0.046 0.011 0.010 0.053 0.056 - - Community College 535 0.141 0.140 0.140 0.160 0.196 0.219 0.256 0.270 0.258 0.271 School District 202 1.750 1.722 1.616 1.819 2.061 2.308 2.689 2.836 2.659 2.792 School District 65 2.535 2.552 2.401 2.655 2.818 3.149 3.671 3.872 3.686 3.810 Total Tax Rate for Property not in Park District or Special Service District 6.541 6.485 6.136 6.802 7.553 8.211 9.482 10.001 9.447 9.694 Percent of Total Tax Rate Levied by the City 19.61%19.97%19.62%20.07%21.08%18.89%18.56%18.56%18.69%18.18% Source: Cook County Assessor's office Government Unit - 147 - CITY OF EVANSTON, ILLINOIS Water Sold by Type of Customer Last Ten Fiscal Years (in 100 cubic feet) 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Type of Customer Residential 2,375,942$ 2,260,284$ 2,174,255$ 2,187,244$ 1,804,433$ 2,276,492$ 2,189,588$ 2,065,980$ 2,098,160$ 1,998,740$ Industrial 16,579 15,722 13,624 14,195 11,552 14,758 12,392 11,627 10,772 21,381 Commercial 1,240,591 1,193,241 1,109,556 1,153,949 928,621 1,117,431 1,105,077 1,036,034 1,045,791 2,313,154 Government 100,278 89,420 69,229 75,308 50,129 66,561 61,908 53,732 55,485 82,066 Total 3,733,390$ 3,558,667$ 3,366,664$ 3,430,696$ 2,794,735$ 3,475,242$ 3,368,965$ 3,167,373$ 3,210,208$ 4,415,341$ Total direct rate per 100 cubic feet 1.52$ 1.52$ 1.52$ 1.52$ 1.52$ 1.75$ 1.80$ 1.98$ 2.18$ 2.18$ * The City changed its fiscal year end to December 31, 2011. Source: City Utilities Department - 148 - CITY OF EVANSTON, ILLINOIS Water Sold by Major Customers Last Ten Fiscal Years 2008 2009 2010 2011 2011*2012 2013 2014 2015 2016 Type of Customer Evanston residents/businesses 6,012,643$ 5,430,019$ 5,396,739$ 5,377,297$ 4,719,084$ 6,124,221$ 5,915,560$ 6,301,307$ 6,975,785$ 6,820,350$ Village of Skokie 3,158,396 2,689,304 2,676,163 2,885,096 2,304,066 2,989,109 2,772,424 2,805,425 2,854,684 2,941,912 Northwest Water Commission 3,620,878 4,820,074 4,506,066 4,781,645 3,710,581 5,033,996 5,183,425 5,074,770 5,183,391 5,695,812 Total 12,791,917$ 12,939,397$ 12,578,968$ 13,044,038$ 10,733,731$ 14,147,326$ 13,871,409$ 14,181,502$ 15,013,860$ 15,458,074$ * The City changed its fiscal year end to December 31, 2011. Source: City Utilities Department - 149 - CITY OF EVANSTON, ILLINOIS Operating Indicators by Function/Programs Last Ten Years 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Function/Program Police Violent offenses 282 299 255 214 180 230 131 97 80 130 Property offenses 2,825 2,739 2,412 2,119 2,144 2,078 1,980 1,959 1,872 1,681 911 calls received 59,135 56,717 52,198 35,991 51,969 44,875 42,551 44,177 46,749 42,763 Fire Emergency responses 8,517 9,134 8,566 8,917 9,063 9,330 9,373 9617 9630 10,267 Fires extinguished 192 185 154 157 157 154 129 120 99 114 Inspections 1,050 1,810 709 680 620 640 660 740 760 - Other Public Works Street resurfacing (estimated miles)3.3 3.3 3.3 3.4 3.4 3.4 3.4 4.9 2.7 2.9 Parks and Recreation Athletic field usage (hours)15,165 17,121 16,185 18,966 20,075 16,761 16,367 16,270 15,531 27,426 Picnic permits issued 373 403 431 460 437 541 445 448 404 229 Library Volumes in collection 458,017 502,019 502,019 471,262 436,382 426,342 400,034 401,300 481,626 534,533 Total volumes borrowed 867,743 945,952 945,952 951,667 891,769 989,638 1,056,243 1,074,972 1,071,401 1,078,653 Water New connections 61 57 28 29 16 4 - 18 9 3 Water main breaks 36 52 52 38 28 66 51 70 23 28 Average daily consumption (millions of gallons)42.91 40.09 39.41 38.91 38.39 39.85 35.81 36.79 36.63 39.645 Peak daily consumption (millions of gallons)66.00 65.40 58.94 57.02 65.95 69.21 56.95 48.91 50.59 55.084 Note: Indicators are not available for general government functions - 150 - CITY OF EVANSTON, ILLINOIS Capital Assets Statistics by Function Last Ten Years 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Function/Program Police Number of stations 1 1 1 1 1 1 1 1 1 1 Budgeted sworn officers 162 165 165 164 164 164 164 164 164 165 Fire Stations 5 5 5 5 5 5 5 5 5 5 Other Public Works Streets (miles)147 147 147 147 147 147 147 147 147 147 Streetlights 5,641 5,641 5,641 5,641 5,641 5641 5641 5641 5641 5736 Parks and Recreation Acreage 290 290 290 290 290 290 290 290 290 290 Playgrounds 51 51 51 51 51 51 51 51 51 51 Baseball/softball diamonds 18 18 18 18 18 18 18 18 18 18 Soccer/football fields 27 27 27 27 27 27 27 27 27 27 Community centers 5 5 5 5 5 5 5 5 6 6 Water Water mains (miles)157 157 157 157 157 157 157 157 156.4 155.6 Fire hydrants 1,370 1,370 1,399 1,399 1,399 1,399 1,399 1,477 1,484 1,490 Storage capacity (millions of gallons)22 22 22 22 22 22 22 22 22 22 Note: No capital asset indicators are available for the general government or library function Source: Various City departments - 151 - COMPLIANCE SECTION INDEPENDENT ACCOUNTANT’S REPORT ON COMPLIANCE WITH STATE OF ILLINOIS PUBLIC ACT 85-1142 The Honorable Mayor Members of the City Council City of Evanston, Illinois We have examined management’s assertion that the City of Evanston, Illinois (the City) complied with the provisions of subsection (q) of Section 11 -74.4-3 of the Illinois Tax Increment Redevelopment Allocation Act (Illinois Public Act 85 -1142) during the year ended December 31, 2016. As discussed in that representation letter, managem ent is responsible for the City’s compliance with those requirements. Our responsibility is to express an opinion on management’s assertion about the City’s compliance based on our examination. Our examination was conducted in accordance with attestation standard s established by the American Institute of Certified Public Accountants . Those standards require that we plan and perform the examination to obtain reasonable assurance about whether management’s assertion about compliance with the specified requirements is fairly stated, in all material respects. An examination involves performing procedures to obtain evidence about whether management’s assertion is fairly stated, in all material respects. The nature, timing, and extent of the procedures selected depend on our judgement, including an assessment of the risks of material misstatement of management’s assertion, whether due to fraud or error. We believe the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion. Our examination does not provide a legal determination on the City’s compliance with statutory requirements. In our opinion, management’s assertion that the City of Evanston, Illinois, complied with the aforementioned requirements for the year ended December 31, 2016, is fairly stated in all material respects. This report is intended solely for the information and use of the City Council, management, the joint review board, the Illinois State Comptroller, and the Illinois Department of Revenue and is not intended to be and should not be used by anyone other than these specified parties. Naperville, Illinois July 20, 2017 - 152 -