CAFR FY2017
KODIAK ISLAND BOROUGH
Comprehensive Annual Financial Report
Year Ended June 30, 2017
KODIAK ISLAND BOROUGH
Comprehensive Annual Financial Report
Year Ended June 30, 2017
Official Issuing Report
Dora Cross
Finance Director
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS
June 30, 2017
Page
INTRODUCTORY SECTION:
Letter of Transmittal 1-4
GFOA Certificate of Achievement 5
Organizational Chart 6
Elected Officials (Photographs) 7
Borough Officials 8
Map of Kodiak Island Borough 9
FINANCIAL SECTION:
Independent Auditor’s Report 10-12
Management’s Discussion and Analysis 13-26
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position 27
Statement of Activities 28
Fund Financial Statements:
Balance Sheet – Governmental Funds 29
Reconciliation of Net Position Between the Government-Wide and the Fund Financial
Statements 30
Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficits) –
Governmental Funds 31
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund
Balances (Deficits) of Governmental Funds to the Statement of Activities 32
Statement of Net Position – Proprietary Funds – Business-Type Activities – Enterprise
Funds 33
Statement of Revenues, Expenses, and Changes in Net Position – Proprietary Funds –
Business-Type Activities – Enterprise Funds 34
Statement of Cash Flows – Proprietary Funds – Business-Type Activities – Enterprise
Funds 35-36
Notes to Basic Financial Statements 37-81
Required Supplementary Information:
Budgetary Comparison Schedule – General Fund 82-83
Budgetary Comparison Schedule – Special Revenue Fund – Education Support 84
Budgetary Comparison Schedule – Special Revenue Fund – Facilities 85
Notes to Required Supplementary Information – Budgetary Comparison Schedules 86
Schedule of Borough’s Proportionate Share of the Net Pension Liability –
Public Employees’ Retirement System 87
Schedule of Borough’s Contributions –
Public Employees’ Retirement System 88
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS, CONTINUED
Page
Additional Supplementary Information:
Budgetary Comparison Schedule – Debt Service Fund – Education and Health 89
Nonmajor Governmental Funds:
Combining Balance Sheet 90
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 91
Nonmajor Special Revenue Funds:
Combining Balance Sheet 92-93
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
(Deficit) 94-95
Schedule of Revenues, Expenditures, and Changes in Fund Balance (Deficit) – Budget
and Actual:
Fire and Road Service Areas:
Fire:
Fire Protection Area No. 1 96
Womens Bay Fire Department 97
Kodiak Airport Fire District 98
Road:
Monashka Bay Road Service Area 99
Service Area No. 1 100
Womens Bay Road Service Area 101
Bay View Road Service Area 102
Service Area No. 2 103
L.E.P.C. 104
Land Sales 105
Buildings and Grounds 106
Woodland Acres Street Light Service Area 107
Trinity Islands Street Light Service Area 108
Tourism Development 109
Mission Lake Tide Gate 110
Fern Fuller Trust 111
Nonmajor Capital Project Funds:
Combining Balance Sheet 112
Combining Statement of Revenues, Expenditures and Changes in Fund Balances 113
Enterprise Funds:
Schedule of Revenues, Expenses, and Changes in Net Position – Budget
and Actual:
Municipal Solid Waste Collection and Disposal 114
Hospital Facilities 115
Long Term Care Center 116
Kodiak Fisheries Research Center 117
911 Services Fund 118
(continued)
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS, CONTINUED
Supplementary Bond Schedules:
Summary of Bonded Debt Service Requirements to Maturity 119
General Obligation Bond, 2011 Series One – Retirement Schedule 120
General Obligation Bond, 2012 Series A – Retirement Schedule 121
General Obligation Bond, 2012 Series B – Retirement Schedule 122
General Obligation Bond, 2013 Series One – Retirement Schedule 123
General Obligation Bond, 2014 Series One – Retirement Schedule 124
General Obligation Bond, 2015 Series Three – Retirement Schedule 125
General Obligation Bond, 2015 Series Three – Retirement Schedule 126
General Obligation Bond, 2016 Series One – Retirement Schedule 127
General Obligation Bond, 2016 Series One – Retirement Schedule 128
General Obligation Bond, 2016 Series Three – Retirement Schedule 129
STATISTICAL SECTION:
Statistical Section Index
Net Position by Component – Last Ten Fiscal Years 130
Changes in Net Position – Last Ten Fiscal Years 131
Fund Balances of Governmental Funds – Last Seven Fiscal Years 132
Changes in Fund Balances of Governmental Funds – Last Ten Fiscal Years 133
General Revenues by Source – Last Ten Fiscal Years 134
Assessed and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years 135
Direct and Overlapping Property Tax Rates and Contributions to the School District –
Last Ten Fiscal Years 136
Property Tax Levies and Collections – Last Ten Fiscal Years 137
Principal Property Tax Payers – Current Year and Ten Years Ago 138
Ratios of Net Bonded Debt– Last Ten Fiscal Years 139
Computation of Direct and Overlapping Debt 140
Legal Debt Margin Information – Last Ten Fiscal Years 141
Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General
Governmental Expenditures and Transfers – Last Ten Fiscal Years 142
Ratios of Outstanding Debt by Type – Last Ten Fiscal Years 143
Demographic and Economic Statistics – Last Ten Fiscal Years 144
Average Monthly Employment & Earnings – Last Ten Fiscal Years 145
Miscellaneous Statistical Data – Last Ten Fiscal Years 146
Property Value, Construction and Bank Deposits – Last Ten Fiscal Years 147
Full-Time Equivalent Borough Employees by Function/Program – Last Ten Fiscal Years 148
Operating Indicators by Function – Last Ten Fiscal Years 149
Capital Asset Statistics by Function/Program – Last Ten Fiscal Years 150
INTRODUCTORY SECTION
1
Kodiak Island Borough
Finance Department
710 Mill Bay Road Kodiak, Alaska 99615
January 30, 2018
Members of the Assembly
Kodiak Island Borough, Alaska
State of Alaska statutes and local charter provisions require that all general-purpose local
governments publish a complete set of financial statements presented in conformity with generally
accepted accounting principles in the United States of America (GAAP) and audited in accordance
with auditing standards generally accepted in the United States of America by a firm of licensed
certified public accountants. Pursuant to that requirement, we hereby issue the comprehensive
annual financial report of the Kodiak Island Borough (Borough) for the fiscal year ended June 30,
2017.
This report consists of management’s representations concerning the finances of the Borough.
Consequently, management assumes full responsibility for the completeness and reliability of all
information presented in this report. To provide a reasonable basis for making these
representations, management of the Borough has established a comprehensive internal control
framework that is designed both to protect the government’s assets from loss, theft, or misuse and
to compile sufficient reliable information for the preparation of the Borough’s financial statements
in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits,
the Borough’s comprehensive framework of internal controls has been designed to provide
reasonable rather than absolute assurance that the financial statements will be free from material
misstatement. As management, we assert that, to the best of our knowledge and belief, this
financial report is complete and reliable in all material respects.
The Borough’s financial statements have been audited by Altman, Rogers & Co., a firm of licensed
certified public accountants. The goal of the independent audit was to form an opinion on whether
the financial statements of the Borough, for the fiscal year ended June 30, 2017, are presented
fairly, in all material respects, in accordance with generally accepted accounting principles in the
United States of America. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements; assessing the accounting
principles used and significant estimates made by management; and evaluating the overall
financial statement presentation. The independent auditor issued an unmodified (“clean”) opinion
on the Borough’s financial statements for the fiscal year ended June 30, 2017. The independent
auditor’s report is presented as the first component of the financial section of this report.
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The independent audit of the financial statements of the Borough was part of broader, State and
federally mandated “Single Audits” designed to meet the special needs of State and federal grantor
agencies. The standards governing Single Audit engagements require the independent auditor to
report not only on the fair presentation of the financial statements, but also on the audited
government’s internal controls and compliance with legal requirements, with special emphasis on
internal controls and legal requirements involving the administration of State and federal awards.
These reports are available in the Borough’s separately issued Single Audit Report.
GAAP require that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it. The Borough’s MD&A can be found immediately following the report of the
independent auditors.
Profile of the Government
The Kodiak Island Borough lies at the western border of the Gulf of Alaska, approximately 40
miles south of the Kenai Peninsula. Kodiak Island is the largest island in Alaska and the second
largest in the United States. About two-thirds of the Borough lies in the Kodiak archipelago with
the remaining third on the Alaska Peninsula, across the Shelikof Strait from Kodiak Island. The
Shelikof Strait is only 20 miles wide in places. The Borough encompasses 7,130 square miles,
making it slightly smaller than the State of Massachusetts and serves a population of 13,824.
The Borough was incorporated September 30, 1963, as a Second Class Borough by Chapter 146
Sessions, Laws of Alaska 1961, as amended. The powers granted to the Borough include area-
wide powers and non area-wide powers. Area-wide powers are health, education, planning and
zoning, emergency services planning, and assessment and collection of taxes for both the Borough
and cities within the Borough. Non area-wide powers include parks and recreation, economic
development, solid waste disposal, animal control, fire protection, street lighting and road
maintenance and construction. A Manager form of government governs the Borough. The Mayor
is elected at large while the Borough Assembly appoints the Manager. The Assembly is composed
of seven members who are elected at-large.
The Borough provides a full range of services including fire protection, the construction and
maintenance of roads and other infrastructure, community and economic development, health,
culture and recreation and solid waste collection and disposal. The Borough also is financially
accountable for a legally separate school district which is reported separately within the Borough’s
financial statements. Additional information on this legally separate entity can be found in the
basic financial statements.
Budgetary Accounting and Internal Controls
The annual budget serves as the foundation for the Borough’s financial planning and control. All
departments of the Borough are required to submit requests for appropriation to the Borough
Manager. The Borough Manager uses these requests as the starting point for developing a proposed
budget. The Borough Manager then presents this proposed budget to the Assembly for review by
April 30. The assembly is required to hold public hearings on the proposed budget and to adopt a
final budget by no later than June 10. The appropriated budget is prepared by fund and department.
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The Assembly makes appropriation transfers between funds and/or departments only after the
adoption of an ordinance. Borough staff may execute transfers between line items within a
department. Amendments to the budget can occur anytime during the fiscal year through the
Borough Assembly or administrative action. Expenditures may not legally exceed appropriations
at the following levels: Capital Project Funds – project level, all other funds – department level.
All funds, except Capital Project Funds, are budgeted on an annual basis encompassing a fiscal
year. Budgets of Capital Project Funds generally encompass the period from start-up to project
completion, which is generally greater than one year.
Budget-to-actual comparisons are provided in this report for each individual governmental and
proprietary fund for which an appropriated annual budget has been adopted.
Factors Affecting Financial Condition
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the Borough
operates.
State economy. The State of Alaska has experienced budget shortfalls in the most recent periods
and these factors are impacting the communities within the state due to decreased state grant
funding and decreased revenue sharing.
Local economy. The economic condition of the Kodiak Island Borough remains healthy. The main
industries of the Borough are commercial fishing, and tourism. The commercial fishing industry
in Kodiak has been stable with severance taxes on seafood ranging from $1,285,298 in FY2007 to
$1,182,924 in FY2017. Tourism continues to be strong in Kodiak. Bed tax revenues have
increased from $68,867 in FY2007 to $108,050 in FY2017, an increase of 37%. Considering
today’s economy, this is very good. To accommodate this demand, construction of fishing lodges,
bed and breakfast accommodations and recreational facilities has increased along with an increase
in charter boat and guide operations. Cruise ships continue to visit Kodiak.
The Kodiak Island Borough is also home to the aerospace industry, which began with construction
of the Kodiak Launch Complex in 1998. Owned by the Alaska Aerospace Development
Corporation (AADC), a public corporation of the State of Alaska, the Kodiak Launch complex is
the first complete launch facility built in the United States since the 1960’s and the first not owned
by the Federal Government. The state-of-the-art facility includes a launch control center, payload
processing facility, spacecraft assembly building and launch pad. It is designed to handle small to
medium sized rockets used to launch low earth orbit satellites, as well as military, scientific and
research missions.
The seafood industry is by far the largest industry in the Kodiak Island Borough. This industry
includes commercial fishing, fisheries research, management and enforcement, seafood
processing, and maintenance and support services. Kodiak is home to the largest port in the State,
housing over 500 commercial vessels and consistently ranks among the top ten ports in the United
States in terms of amount and value of product delivered
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Kodiak is home to the largest U.S. Coast Guard base in the country, employing nearly 1,350 people
and providing vital services to the marine industries that are an integral part of Kodiak’s make-up
as well as making a significant contribution to the Kodiak community.
Employment varies throughout the year with July, August, and September being the peak months
due to the increased activity in the fisheries and related businesses, and then declines in November
and December when fishing quotas are reached. At June 30, 2017, the unemployment rate for the
Kodiak Island Borough was 4.8%.
Long-term financial planning. The Borough adopts a strategic plan. In this plan, the Borough
decides what its goals and objectives are for the next year. To view the complete Strategic plan,
you can visit our web site at www.kodiakak.us. The basis of the strategic plan is:
Essential governmental services are to be provided at a level equal to or better than the
level previously provided. Plan for revenues and expenses to create a government that is
more efficient, less costly and more accountable to ensure a financially sustainable borough
for future generations.
All services are to be constantly examined to ensure that they are provided in an efficient
and effective manner and that unnecessary program costs are eliminated.
Each department’s progress in achieving their objectives is reviewed and monitored
throughout the budget year.
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded
a Certificate of Achievement for Excellence in Financial Reporting to the Borough for its
comprehensive annual financial report (CAFR) for the fiscal year ended June 30, 2016. This was
the twenty-seventh consecutive year that the Borough has received this prestigious award. In order
to be awarded a Certificate of Achievement, a government must publish an easily readable and
efficiently organized comprehensive annual financial report. This report must satisfy both
generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
CAFR continues to meet the Certificate of Achievement Program’s requirements and we are
submitting it to the GFOA to determine its eligibility for another certificate.
The preparation of this report would not have been possible without the efficient and dedicated
services of the entire staff of the administration and finance department. We would like to express
our appreciation to all members of the department who assisted and contributed to the preparation
of this report. Credit must be given to the mayor and the assembly for their unfailing support for
maintaining the highest standards of professionalism in the management of the Borough’s
finances.
Respectfully submitted,
Michael Powers Dora Cross
Borough Manager Director of Finance
5
6
Electorate
Manager Borough Attorney
Engineering/
Facilities Director
BVFD
Manager
Finance/MIS
Director
Borough Mayor
Borough Assembly
Community
Development
Director
Maintenance
Specialist
KFRC
Maintenance
Engineer
Admin Support
Asst.
Solid Waste
Manager
Baler
Supervisor
Treatment Plant
Operator Lead
Baler Operator
Senior Baler
Operator
Baler Operator
Baler Operator
Baler Operator
Management Analyst
Assessing
Director
Planner
Planner
Code Enforcement
Officer
Admin Support
Asst.
Lead Appraiser
Appraiser
Technician
Appraiser
Technician
Admin
Support Asst.
Fiscal Analyst
Fiscal
Technician
Fiscal Analyst
Admin Support
Asst.
IT
Administrator
IT Analyst
IT Analyst
Fiscal Asst.
Clerks Office
Director
Admin Support
Specialist Admin Support
Specialist
Kodiak Island Borough
Fiscal Year 2017
Projects
Manager
Projects
Inspector
Maintenance
Administrator
Projects
Assistant
Management Analyst Management
Analyst
Landfill Attendant
Treatment Plant
Operator
Treatment Plant
Operator Trainee
Admin Support
Asst.
Admin Support
Asst.
Fiscal
Technician
IT Technician
MAYOR AND ASSEMBLY MEMBERS
7
Kyle Crow, Rebecca Skinner,
At Large, 2018 At Large, 2017
Dan Rohrer, Mayor, 2019
Scott Smiley, Dennis Symmons,
At Large, 2017 At Large, 2017
Dave Townsend, Matt VanDaele,
At Large, 2017 At Large, 2019
Larry LeDoux,
Deputy Presiding Officer (DPO),
At Large, 2017
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KODIAK ISLAND BOROUGH
KODIAK, ALASKA
BOROUGH OFFICIALS
YEAR ENDED JUNE 30, 2017
MAYOR
Dan Rohrer ‘19
ASSEMBLY
Kyle Crow ‘18 Rebecca Skinner ‘17
Scott Smiley ’17 Dennis Symmons ‘17
Dave Townsend ’17 Matt VanDaele, ‘19
MANAGEMENT
Michael Powers .................................................................................................. Borough Manager
Dora Cross ............................................................................................... Finance Director/Treasurer
Nova Javier, CMC ....................................................................................................... Borough Clerk
Sara Mason .................................................................................. Community Development Director
Bill Roberts ............................................................................................................Borough Assessor
Howard Rue ....................................................................................................................... Fire Chief
Robert Tucker .............................................................................. Engineering and Facilities Director
Paul Van Dyke .............................................................................................................. IT Supervisor
Lauri Whiddon ................................................................................. HR Officer/Executive Assistant
Levesque Law Group, LLC ...................................................... Borough Attorney (Contracted Firm)
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FINANCIAL SECTION
10
425 G Street Suite 800 Anchorage, Alaska 99501 Phone 907-274-2992 Fax 907-274-2993
Offices in Juneau and Soldotna A Professional Corporation
Independent Auditor’s Report
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
Kodiak, Alaska
Report on the Financial Statements
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 Kodiak Island Borough, as of and for the year ended June 30, 2017, and the related
notes to the financial statements, which collectively comprise the Borough’s basic financial statements as
listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation
and fair presentation of the financial statements in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
11
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 Kodiak
Island Borough, as of June 30, 2017, and the respective changes in financial position and, where applicable,
cash flows thereof for the year then ended in accordance with accounting principles generally accepted in
the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s
Discussion and Analysis, Budgetary Comparison Schedules and notes to RSI, and Schedules of Borough’s
Proportionate Share the of Net Pension Liability and Contributions for the Public Employees’ Retirement
System on pages 13-26, 82-86, and 87-88, respectively, 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 Kodiak Island Borough’s basic financial statements. The information listed in the table of
contents as “Additional Supplementary Information”, which includes Budgetary Comparison Schedule –
Debt Service Fund – Education and Health; Nonmajor Governmental Funds: Combining Balance Sheet and
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances, Nonmajor Special
Revenue Funds: Combining Balance Sheet, Combining Statement of Revenues, Expenditures and Changes
in Fund Balances (Deficit), and Schedules of Revenues, Expenditures, and Changes in Fund Balance
(Deficit) – Budget and Actual; Nonmajor Capital Project Funds: Combining Balance Sheet and Combining
Statement of Revenues, Expenses and Changes in Fund Balances (Deficit); Enterprise Funds: Schedule of
Revenues, Expenditures, and Changes in Net Position – Budget and Actual, is presented for purposes of
additional analysis and is not a required part of the basic financial statements.
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
12
The Additional Supplementary Information listed on the previous page is the responsibility of management
and was derived from and relates directly to the underlying accounting and other records used to prepare
the basic financial statements. Such information has been subjected to the auditing procedures applied in
the audit of the basic financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting and other records used to prepare the
basic financial statements or to the basic financial statements themselves, and other additional procedures
in accordance with auditing standards generally accepted in the United States of America. In our opinion,
the Additional Supplementary Information listed on the previous page is fairly stated, in all material
respects, in relation to the basic financial statements as a whole.
We also have previously audited, in accordance with auditing standards generally accepted in the United
States of America, the basic financial statements of Kodiak Island Borough as of and for the year ended
June 30, 2016 (not presented herein), and have issued our report thereon dated December 29, 2016, which
contained unmodified opinions on the respective financial statements of the governmental activities, the
business-type activities, the discretely presented component unit, each major fund, and the aggregate
remaining fund information. The individual fund financial statements and schedules for the year ended
June 30, 2016, are presented for purposes of additional analysis and are not a required part of the basic
financial statements. Such information is the responsibility of management and was derived from and
relates directly to the underlying accounting and other records used to prepare the June 30, 2016 financial
statements. The information has been subjected to the auditing procedures applied in the audit of June 30,
2016 basic financial statements and certain additional procedures, including comparing and reconciling
such information directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements themselves, and other additional procedures in accordance with
auditing standards generally accepted in the United States of America. In our opinion, the individual fund
financial statements and schedules are fairly stated in all material respects in relation to the basic financial
statements as a whole for the year ended June 30, 2016.
The Introductory Section, the Supplementary Bond Schedules, and the Statistical Section, as identified in
the table of contents, 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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated January 30, 2018
on our consideration of the Kodiak Island Borough's internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and
other matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on the
effectiveness of Kodiak Island Borough’s internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards in
considering Kodiak Island Borough’s internal control over financial reporting and compliance.
Anchorage, Alaska
January 30, 2018
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis
June 30, 2017
13
As management of the Kodiak Island Borough, we offer readers of these financial statements this narrative
overview and analysis of the financial activities of the Kodiak Island Borough for the fiscal year ended
June 30, 2017. 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 pages 1 -
4 of this report.
FINANCIAL HIGHLIGHTS
The assets and deferred outflows of resources of the Kodiak Island Borough exceeded its liabilities
and deferred inflows of resources at the close of the most recent fiscal year by $178,833,177 (net
position). Of this amount, $57,878,016 (unrestricted net position) may be used to meet the Borough’s
ongoing obligations to citizens and creditors.
The Borough’s total net position increased by $886,949 (0.50%). The governmental net position
increased by $1,022,782 (0.80%) and the business-type net position decreased by $135,833 (0.27%).
Total equity in the central treasury decreased by $4,922,049 (6.23%). The governmental central
treasury decreased by $6,077,716 (9.05%) and the business-type central treasury increased by
$1,155,667 (9.76%).
At the end of the current fiscal year, the Borough’s governmental funds reported combined fund
balances of $53,647,068. This was a decrease of $2,328,562, compared to the net change in the prior
year of an increase of $4,532,687. Approximately 3.9% of this total amount, $2,094,057, is available
for spending at the government’s discretion (unassigned fund balance).
At the end of the current fiscal year, unassigned fund balance for the General Fund was $2,284,775.
This amounts to 40.98% of total General Fund expenditures
The Borough’s total noncurrent liabilities decreased by $6,856,723 (5.16%). Bonds payable
decreased by $8,855,521 (7.25%), net pension liability increased by $1,888,834 (34.06%), and
landfill closure costs increased by $109,964 (2.16%).
OVERVIEW OF THE FINANCIAL STATEMENTS
The management discussion and analysis serves as an introduction to the Borough’s basic financial
statements, which are the 1) government-wide financial statements, 2) fund financial statements, and 3)
notes to the financial statements. This report also contains 4) required supplementary information and 5)
other supplementary information in addition to the basic financial statements.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
14
1) Government-wide Financial Statements (pages 27-28)
The government-wide financial statements are designed to provide readers with a broad overview of the
Borough’s finances in a manner similar to a private-sector business. These statements combine and
consolidate short-term, spendable resources with capital assets and long-term obligations. The government-
wide financial statements are divided into the following three categories:
Governmental activities – These are functions of the Borough that are financed primarily by taxes,
intergovernmental revenues, and charges for services. The Borough’s governmental activities
include general government, public safety, emergency services, public services, education, non-
profit contributions, service districts, and debt service.
Business-type activities – These are functions of the Borough in which customer user fees and
charges are used to help cover all or most of the cost of services they provide. The Borough’s
business-type activities include solid waste collections and disposal (landfill) operations, 911
service, and long-term property leases for various Borough owned buildings for a hospital, long-
term care center, and a fisheries research center.
Component unit – The Borough also includes the Kodiak Island Borough School District in its
report as it is financially accountable for this “component unit”. Financial information for the
School District is reported separately from the financial information presented for the primary
government itself.
The Statement of Net Position (the “Unrestricted Net Position”) is designed to be a bottom line for the
Borough and its governmental activities and component unit. This statement combines and consolidates
governmental funds’ current financial resources (short-term spendable resources) with capital assets,
including infrastructure, and long-term obligations. Net positions are the difference between the Borough’s
assets and deferred outflows of resources and its liabilities and deferred outflows of resources. Increases
or decreases in net position may serve as a useful indicator of whether the financial position of the Borough
is improving.
The Statement of Activities reflects the expenses of a given function, which are offset by program revenues.
All changes in net position are reported as soon as the underlying event given rise to the change occurs,
regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement
for some items that will result in cash flows in future fiscal periods. Program revenues are defined as charges
for services, operating grants and contributions, and capital grants and contributions directly associated
with a given function.
Both of the government-wide financial statements distinguished functions of the Borough that are
principally supported by taxes and intergovernmental revenues (governmental activities) from other
functions that are intended to recover all or a significant portion of their costs through user fees and charges
(business-type activities). The governmental activities of the Borough include general governmental, public
safety, community and economic development, emergency preparedness, health and sanitation, education,
culture and recreation, parks and recreation, service district maintenance, and primary and secondary
education. The business-type activities of the Borough include a 911 emergency system, a solid waste
collection and disposal facility, and Borough-owned hospital, long-term care facility, and a fisheries
research center.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
15
The government-wide financial statements include not only the Borough itself (known as the primary
government), but also the legally separate school district for which the Borough is financially accountable.
Financial information for this component unit is reported separately from the financial information
presented for the primary government itself.
2) Fund Financial Statements (pages 29-36)
A fund is a grouping of related accounts that is used to maintain control over resources that have been
segregated for specific activities or objectives. The Borough, like other state and local governments, uses
fund accounting to ensure and demonstrate fiscal accountability. All the funds of the Borough can be
divided into two categories: a) governmental funds and b) proprietary funds.
Number of Funds
Fund Type
Major
Non-
Major
Total
Funds
Governmental Funds:
General Fund 1 - 1
Debt Service Fund 1 - 1
Special Revenue 2 16 18
Capital Projects 1 6 7
Total Governmental Funds 5 22 27
Proprietary Funds:
Enterprise Fund 5
Total All Funds 32
a) Governmental Funds (pages 82-86 and 89-113) – Governmental funds are used to account for
essentially the same functions reported as governmental activities in the government-wide financial
statements. However, unlike the government-wide statements, governmental fund financial statements
focus on the short-term view of the Borough’s operations. Because the focus of governmental funds is
narrower than that of the government-wide financial statements, it is useful to compare the information
presented for the governmental funds with similar information presented for governmental activities in the
government-wide financial statements. Both the governmental fund balance sheet and the governmental
fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate
this comparison between governmental funds and governmental activities.
The Borough adopts an annual appropriated budget for its General Fund, Special Revenue Funds and Debt
Service Fund. Budgetary comparison statements have been provided for the funds to demonstrate
compliance with the budget.
b) Proprietary Funds (pages 33-36 and 114-118) – The only Proprietary Fund type that the Borough uses
is enterprise funds. Proprietary fund statements provide the same type of information as the government-
wide financial statements, only in more detail. Enterprise funds are used to account for activities for which
a fee is charged to external users for goods and services.
The Borough adopts an annual appropriated budget for its proprietary funds. Budgetary comparison
statements have been provided for the funds to demonstrate compliance with the budget.
3) Notes to the Basic Financial Statements (pages 37-81)
The notes provide additional information that is essential to a full understanding of the data provided in the
government-wide and fund financial statements.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
16
4) Required Supplementary Information (pages 82-88)
The required supplementary information (RSI) includes required budgetary supplementary information and
the schedules of the proportionate share of the net pension liability and pension contributions.
5) Other Supplementary Information (page 89-118)
The basic financial statements are followed by additional supplementary information on individual fund
activity.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Statement of Net Position (page 27)
As noted earlier, net position may serve over time as a useful indicator of a government’s financial
position. In the case of the Borough, assets and deferred outflows of resources exceeded liabilities
and deferred inflows of resources by $178,833,177 at June 30, 2017, compared to $177,946,228,
at June 30, 2016
The largest portion of the Kodiak Island Borough’s net position ($120,955,161 or 68%) reflects
its investment in capital assets (e.g. land, buildings, equipment and infrastructure) net of any
related debt used to acquire those assets. The Borough uses these capital assets to provide services
to citizens; consequently, these capital assets are not available for future spending. Although the
Borough’s investment in capital assets is reported net of related debt, it should be noted that the
resources needed to repay this debt must be provided from other sources, since the capital assets
themselves cannot be used to liquidate these liabilities.
Total net position has increased over the past 10 years indicating an improving financial position
as illustrated by the graph below. The Borough has maintained a stable financial position and the
$57,878,016 of unrestricted net position may be used to meet the Borough’s ongoing obligations
to citizens and creditors.
0.00
20,000,000.00
40,000,000.00
60,000,000.00
80,000,000.00
100,000,000.00
120,000,000.00
140,000,000.00
160,000,000.00
180,000,000.00
200,000,000.00
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Total Net Position of Governmental and
Business-Type Activities
Business Type Activities Governmental Activites
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
17
Governmental Business-type Total
Activities Activities Activities
2017 2016 2017 2016 2017 2016
Current and other assets $ 63,648 69,230 17,027 16,456 80,675 85,685
Capital assets 163,160 163,229 71,113 73,073 234,273 236,303
Deferred outflows of resources 1,295 860 336 215 1,631 1,075
Total assets and deferred
outflows of resources $ 228,103 233,319 88,476 89,744 316,579 323,063
Long-term liabilities $ 83,734 86,397 36,797 40,806 120,531 127,203
Other liabilities 15,151 18,715 1,981 (900) 17,132 17,815
Deferred inflows of resources 67 79 16 20 83 99
Total liabilities and deferred
inflows of resources $ 98,952 105,191 38,794 39,926 137,746 145,117
Net Position:
Net investment in capital assets $ 80,857 76,748 40,098 37,382 120,955 114,130
Unrestricted 48,294 51,380 9,584 12,436 57,878 63,816
Total Net Position $129,151 128,128 49,682 49,818 178,833 177,946
Net Position of Governmental and Buisness-type Activities (in thousands)
For Years Ended June 30, 2017 and 2016
Changes in Net Position
During the current fiscal year, the Borough’s total net position increased by $886,949 (.50%). This
compares to an increase of $2,732,715 for the year ended June 30, 2016. Of the $886,949 increase, the
governmental net position increased by $1,022,782 (0.80%) and the business-type net position decreased
by $135,833 (0.27%).
Revenues decreased overall by $4,052,327 (10.02%) with the majority of this resulting from a decrease in
operating and capital grants. The prior year included one-time revenues which did not occur in fiscal year
2017.
Expenses decreased overall by $2,465,885 (6.65%) from the prior year. During fiscal year 2017,
approximately 41% of the Borough’s total expenses went toward primary and secondary education.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
18
Statement of Activities (page 28)
The following table shows the changes in net position for fiscal years 2017 and 2016 for both governmental
and business type activities.
2017 2016 2017 2016 2017 2016
Revenues:
Program revenues:
Charges for services $ 3,000,656 765,425 5,733,131 8,172,981 8,733,787 8,938,406
Operating grants and contributions 4,226,913 4,813,838 27,799 428,578 4,254,712 5,242,416
Capital grants 885,493 3,216,270 — 11,326 885,493 3,227,596
General revenues:
Property taxes 15,714,593 14,414,032 — — 15,714,593 14,414,032
Grants and entitlements not restricted
to specific programs 3,631,012 3,985,978 — — 3,631,012 3,985,978
Land sales 325,793 27,683 — — 325,793 27,683
Severance taxes 1,414,557 1,586,555 — — 1,414,557 1,586,555
Other 23,306 675,246 115,556 203,764 138,862 879,010
Insurance proceeds — 403,958 — — — 403,958
Loss on advanced refunding of debt — — (54,590) — (54,590) —
Investment earnings 271,691 604,274 177,851 236,180 449,542 840,454
Total revenues 29,494,014 30,493,259 5,999,747 9,052,829 35,493,761 39,546,088
Expenses:
General government 7,156,087 7,850,988 — — 7,156,087 7,850,988
Public safety 1,028,240 798,079 — — 1,028,240 798,079
Community and economic development 1,136,303 1,167,367 — — 1,136,303 1,167,367
Emergency preparedness 35,861 30,849 — — 35,861 30,849
Health and social services 233,999 389,000 — — 233,999 389,000
Education, culture and recreation 17,562 23,949 — — 17,562 23,949
Parks and recreation 30,172 87,456 — — 30,172 87,456
Service district maintenance 475,248 626,289 — — 475,248 626,289
Primary and secondary education 14,162,868 14,197,077 — — 14,162,868 14,197,077
Interest on long-term debt 3,060,520 3,492,549 — — 3,060,520 3,492,549
Municipal solid waste collection and
disposal — — 3,296,817 4,764,871 3,296,817 4,764,871
Hospital facilities — — 1,284,657 2,058,690 1,284,657 2,058,690
Long Term Care Center — — 1,128,059 1,128,059
Kodiak Fisheries Research Center — — 1,532,010 1,555,116 1,532,010 1,555,116
911 services — — 28,409 30,417 28,409 30,417
Total expenses 27,336,860 28,663,603 7,269,952 8,409,094 34,606,812 37,072,697
Change in net position
before transfers 2,157,154 1,829,656 (1,270,205) 643,735 886,949 2,473,391
Transfers (1,134,372) (50,228) 1,134,372 50,228 — —
Change in net position 1,022,782 1,779,428 (135,833) 693,963 886,949 2,473,391
Net position, beginning of year,
as previously stated 128,127,951 126,089,199 49,818,277 49,124,314 177,946,228 175,213,513
Prior period adjustment — 259,324 — — — 259,324
Net position, beginning of year,
as restated 128,127,951 126,348,523 49,818,277 49,124,314 177,946,228 175,472,837
Net position, end of year $ 129,150,733 128,127,951 49,682,444 49,818,277 178,833,177 177,946,228
Governmental activities Business-type activities Total Activities
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
19
Governmental Activities – Increased the Borough’s net position by $1,022,782.
The largest source of revenue from governmental activities is property taxes, which amounted to
$15,714,593, a 9.02% increase from 2016. Charges for services was the largest increasing revenue by
$2,235,231 (292.02%) and capital grants was the largest decreasing revenue by $2,330,477 (72.46%).
Overall, total revenues decreased by $999,245 (3.28%) from 2016.
The largest expense from governmental activities is from Primary and Secondary Education, which
amounted to $14,162,868, a 0.24% decrease from 2016. General Government was the largest decreasing
expense by $694,901 (8.85%). Public Safety and Emergency Preparedness were the only two activities
with increased expenses of $230,161 (28.84%) and $5,012 (0.16%), respectively. Overall, total expenses
decreased by $1,326,743 (4.63%) from 2016.
Charges for Services
25%
Operating
Grants and
Contributions
12%Capital Grants
3%
Property Taxes
44%
Grants and
Entitlements not
restricted to
specific
programs
10%
Land Sales
1%
Severance Taxes
4%
Investment Earnings
1%
FY2017 Governmental Activities - Revenue Sources
General Government
26%
Public Safety
4%
Community and
Economic
Development
4%
Health and Social
Services
1%Service District
Maintenance
2%
Primary and
Secondary Education
52%
Interest on
Long-term Debt
11%
FY2017 Governmental Funds - Functional Expenses
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
20
Business Activities - Decreased the Kodiak Island Borough’s net position by $135,833.
The largest source of revenue from business-type activities is Charges for Services, which amounted to
$5,733,131, a 29.85% decrease from 2016. All revenues decreased with Charges for Services being the
largest at $2,439,850 (29.85%) and Capital Grants the least at $11,326 (100%). Overall, total revenues
decreased by $3,053,082 (33.73%) from 2016.
The larges expense from business-type activities is from Municipal Solid Waste Collection and Disposal,
which amounted to $3,296,817, a 30.81% decrease from 2016. During the current fiscal year, the Long
Term Care Center was separated from the Hospital Fund. For comparison purposes, the Hospital Fund and
Long Term Care Center combined had a decrease in expense by $354,026 (17.2%). All expenses decreased
with the largest being Municipal Solid Waste Collection and Disposal at $1,468,054 (30.81%) and the least
being 911 Service at $2,008 (6.60%). Overall, total expenses decreased by $1,139,142 (13.55%) from 2016.
47%
19%
9%
25%
0%
FY2017 Business-Type Activities - Functional Expenditures
Municipal Solid Waste Collection
and Disposal
Hospital Facilities
Long-Term Care Center
Kodiak Fisheries Research Center
911 Service
96%
3%1%
FY2017 Business-Type Activities - Revenue Sources
Charges for Services
Interest Earnings
Other
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
21
FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS
As noted earlier, the Borough uses fund accounting to ensure and demonstrate compliance with finance
related legal requirements. These funds are accounted for using the modified accrual basis of accounting.
Governmental Funds – The focus of the Borough’s governmental funds is to provide information on
near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing
the Borough’s financing requirements. Unreserved fund balance may serve as a useful measure of a
government’s net resources available for spending at the end of the fiscal year.
As of the end of the current fiscal year, the Borough’s governmental funds reported combined ending fund
balances of $53,647,068, a decrease of $2,328,562 in comparison to the beginning of the year. $451,561 of
this total amount constitutes nonspendable fund balances, $44,035,100 is committed fund balances,
$7,066,350 is assigned fund balances and $2,094,057 is unassigned fund balances.
The General Fund is the main operating fund of the Borough. At the end of the current fiscal year,
nonspendable fund balance of the General Fund was $32,349, with an unassigned fund balance of
$2,284,775 for a total fund balance of $2,317,124. As a measure of the General Fund’s liquidity, it may be
useful to compare fund balance to total expenditures. Unassigned fund balance represents 41% of total
General Fund expenditures.
Major Fund Highlights
General Fund – fund balance decreased by $968,657 during the current fiscal year. While overall
there was no significant change it is worth noting due to the State of Alaska’s governor decreasing
funding to school debt reimbursement payments by 25%, the Borough’s general fund transferred
$958,451 in order to cover required debt service payments.
Education Support (Special Revenue Fund) - Decreased by $53,994 during the current fiscal year.
The key factor leading to this change was less property and motor vehicle tax revenues.
Facilities Fund (Special Revenue Fund) - Decreased by $246,922 during the current fiscal year.
The key factor leading to this decrease was increased use of previous earnings compared to the
prior year.
Education Debt Service Fund (Special Revenue Fund) – increased by $17,163, which is consistent
with prior years.
Renewal and Replacement Projects (Capital Project Fund) - Decreased by $3,631,841 during the
current fiscal year. The key factor leading to this was budgeted use of assigned fund balance.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
22
Other Governmental Funds (Non-Major Funds) Highlights
Fire Protection Area No. 1 (Special Revenue Fund) - Increased by $313,581. This increase was
achieved primarily by the sale of capital assets. This fund is accumulating a balance with the intent
to make large equipment purchases in 2018.
Womens Bay Fire Department (Special Revenue Fund) - Increased by $65,380. The key factor
leading to this increase was to accumulate a balance in order to make a large equipment purchase
in 2018.
Monashka Bay Road Service Area (Special Revenue Fund) increased by $42,743. The key factors
leading to this increase were lower snow removal and repair and maintenance costs.
Service Area No. 1 (Special Revenue Fund) - Increased by $237,886. The key factor leading to
this increase was lower snow removal and maintenance costs.
Womens Bay Road Service Area (Special Revenue Fund) - Decreased by $66,176. The key factor
leading to this decrease was increased spending for support goods and services.
Land Sales (Special Revenue Fund) - Increased $1,078,769. The key factors leading to this increase
were increased revenues due to sale of salvaged timber and a land sale.
Tourism Development (Special Revenue Fund) - Decreased $14,636. The key factors leading to
this decrease were additional cruise ship tax revenues but an increase in expenditures.
Proprietary Funds – The Borough’s proprietary funds provide the same type of information found in the
government-wide financial statements, but in more detail.
As of the end of the current fiscal year, the Borough’s proprietary funds reported combined net position of
$49,682,444, a $135,833 (0.27%) decrease in comparison to the beginning of the year.
Major Fund Highlights
Municipal Solid Waste Collection and Disposal (Enterprise fund) - Decreased by $128,404
(0.84%) due to an increase in charges for services and an increase in closure/post-closure
expenses.
Hospital Facilities (Enterprise Fund) – Decreased by $5,740,166 (26.44%) due to removing the
long-term care center from this fund.
Long-Term Care Center (Enterprise Fund) – Increased by $6,295,687 (100%) due to creating a
new fund for the long-term care center and removing it from the Hospital fund.
Kodiak Fisheries Research Center (Enterprise Fund) - Decreased by $562,950 (4.39%) due to
decrease in lease revenues.
Other Nonmajor Fund Highlights
911 Services (Enterprise Fund) - No change since this fund is a pass through to the City of Kodiak.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
23
2017 Program Revenues versus Expenses
GENERAL FUND BUDGETARY HIGHLIGHTS (pages 82-83)
The Borough’s budget is prepared, according to Alaska law, using a basis of accounting that is consistent
with accounting principles generally accepted in the United States of America. The most significant budget
areas are in the General Fund.
Within the General Fund revenues, the largest difference between budgeted and actual receipts was fish
severance taxes receiving $480,076 less and Federal PILT (Payment in Lieu of Taxes) receiving $260,112
more than budgeted. Overall, actual revenues were $637,227 (10.28%) less than budgeted.
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
MUNICIPAL
SOLID
WASTE
HOSPITAL
FACILITIES
LONG-
TERM
CARE
CENTER
KODIAK
FISHERIES
RESEARCH
CENTER
911
SERVICE
Revenues Expenses
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
Property Taxes Severance
Taxes
State Sources Federal Sources Other
FY17 Budget to Actual Comparison of Revenues
Budgeted Actual
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
24
Within the General fund expenditures, the largest difference between budgeted and actual expenses was the
finance department expending $227,807 less and the engineering department expending $142,336 more
than budgeted. Overall, actual expenditures were $639,946 (10.30%) less than budgeted.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets (Note 8 on page 52-56) – The Borough’s investment in capital assets includes, land,
buildings and improvements, improvements other than buildings, machinery and equipment, and
construction work-in-progress. As of June 30, 2017, the total net book value was $234,272,656. The
$2,029,974 net decrease was mostly due to decrease in construction work-in-progress.
The following table displays the capital assets (net of accumulated depreciation) at June 30, 2017 with a
comparison to 2016.
2017 2016 2017 2016 2017 2016
Artwork $ — — 16,091 16,091 16,091 16,091
Land 23,852,758 23,444,818 1,661,499 1,661,499 25,514,257 25,106,317
Construction work-in-progress 86,867,058 86,597,475 28,448,177 27,833,039 115,315,235 114,430,514
Buildings and improvements 39,605,633 39,454,078 36,599,907 38,787,026 76,205,540 78,241,104
Improvements other than 11,294,569 12,331,305 3,088,939 3,379,354 14,383,508 15,710,659
buildings
Equipment 970,611 756,255 456,891 513,190 1,427,502 1,269,445
Infrastructure 569,421 645,343 — — 569,421 645,343
Unclassified plant in service — — 841,102 883,157 841,102 883,157
$ 163,160,050 163,229,274 71,112,606 73,073,356 234,272,656 236,302,630
Governmental
activities
Business-type
activities activities
Total
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
FY17 Budget to Actual Comparison of Expenditures
Budgeted
Actual
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
25
Long-Term Debt (Note 10, pages 60-64) – At the end of the current fiscal year, the Borough had total
bonded debt outstanding of $74,080,000. This entire amount is backed by the full faith and credit of the
Borough. The remainder of the Borough’s debt represents loans and notes payable, compensated absences,
landfill closure and post-closure costs, and revenue bonds payable.
The following table displays the long-term debt at June 30, 2017 with a comparison to 2016.
Governmental Business-type
activities activities
2017 2016 2017 2016 2017 2016
General obligation bonds, including premium $ 82,302,899 86,481,657 — — 82,302,899 86,481,657
Compensated absences 242,398 237,727 — — 242,398 237,727
Landfill post closure care costs — — 5,204,000 5,094,036 5,204,000 5,094,036
Notes payable — — 19,139,725 18,445,504 19,139,725 18,445,504
Revenue Bonds Payable — — 11,874,871 17,245,855 11,874,871 17,245,855
$ 82,545,297 86,719,384 24,343,725 23,539,540 118,763,893 127,504,779
Total
Activities
The Borough’s total debt decreased by $8,740,886 (6.86%) during the current fiscal year. This decrease
can be attributed to regularly scheduled bond payments and the defeasement of a portion of the long-term
care revenue bonds. During 2017 the Borough refunded one of the general obligation bonds which will
result in interest expense savings of the life of the bond.
There is no general obligation debt limit imposed on the Borough by the State Constitution, state statutes,
or the Borough’s charter or code.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
Economic Factors:
Kodiak continues to be one of the nation’s largest producers of seafood. The Borough has the
largest and most diversified fishing port in Alaska and is consistently ranked in the top three
largest fishing ports in the U.S. in terms of value landed.
Tourism continues to increase with a steady number of cruise ships stopping in Kodiak and bed
tax revenues from visitors increasing.
Unemployment varies throughout the year due to the seasonal nature of the fishing industry;
however, the Borough’s 2016 unemployment rate was 4.8% compared to 6.7% Alaska-wide.
The United States Coast Guard continues to maintain their largest base on Kodiak Island. Their
area of responsibility covers the Gulf of Alaska, Bristol Bay, the Bering Sea and Alaska’s Pacific
coast.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
26
Next Year’s Budgets and Rates:
Property tax revenues are projected to increase in future years as the Borough’s assessed valuation
continues to increase.
Fish revenues from the State and from local sources are projected to decrease due to quota and
catch limit restrictions.
No increase to the State of Alaska’s ceiling of 22% for political subdivision contributions to PERS
(Public Employees Retirement System).
General Obligation bond payments are projected to remain steady now that the
remodel/construction of the High School is nearing completion.
Landfill user fees are expected in increase due to the landfill expansion and the new leachate
treatment plant.
All of these factors were considered in preparing the Borough’s budget for fiscal year 2018.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the Borough’s finances for all those with
an interest. Questions concerning any of the information provided in this report or requests for additional
information should be addressed to the Kodiak Island Borough, Director of Finance, 710 Mill Bay, Kodiak,
Alaska 99615.
BASIC FINANCIAL STATEMENTS
Component
Primary government unit Total reporting entity
Governmental Business-type School
activities activities Total District 2017 2016
Equity in central treasury $ 61,047,568 12,996,677 74,044,245 — 74,044,245 79,500,996
Due from primary
government — — — 7,785,248 7,785,248 8,258,650
Receivables:
State of Alaska 482,993 — 482,993 1,791,338 2,274,331 1,671,635
Federal government 280,005 — 280,005 — 280,005 651,839
Property taxes, net of
allowance of $15,789 316,132 — 316,132 — 316,132 308,115
Severance taxes 376,432 — 376,432 — 376,432 376,393
Interest 192,190 — 192,190 — 192,190 273,218
Land sales contracts
receivable 384,792 — 384,792 — 384,792 204,819
Accounts and other
receivables, net 116,487 421,349 537,836 377,961 915,797 3,426,976
Current portion of
notes receivable — 114,135 114,135 — 114,135 110,215
Inventories — 693,747 693,747 488,715 1,182,462 1,254,368
Prepaid items 451,561 — 451,561 — 451,561 26,309
Restricted cash and equivalents — 1,285,654 1,285,654 — 1,285,654 1,649,190
Notes receivable — 1,515,401 1,515,401 — 1,515,401 1,629,536
Capital assets:
Non-depreciable 110,719,816 30,125,767 140,845,583 — 140,845,583 139,552,922
Depreciable, net 52,440,234 40,986,839 93,427,073 876,766 94,303,839 97,704,358
Total assets 226,808,210 88,139,569 314,947,779 11,320,028 326,267,807 336,599,539
Deferred outflows of resources -
Pension deferrals 1,294,672 336,338 1,631,010 7,109,951 8,740,961 6,663,515
Total assets and deferred
outflows of resources $228,102,882 88,475,907 316,578,789 18,429,979 335,008,768 343,263,054
Liabilities:
Accounts payable $1,156,393 272,669 1,429,062 1,041,464 2,470,526 3,324,225
Accrued compensation
and related liabilities 513,231 99,766 612,997 3,161,678 3,774,675 4,427,834
Other accrued liabilities 1,156,282 459,540 1,615,822 — 1,615,822 1,479,205
Customer deposits 27,450 49,968 77,418 — 77,418 69,918
Unearned revenues 30,930 155,277 186,207 161,800 348,007 231,626
Due to component unit 7,785,248 — 7,785,248 — 7,785,248 8,258,650
Noncurrent liabilities:
Due within one year 4,481,112 943,438 5,424,550 33,701 5,458,251 6,361,734
Due in more than
one year 77,821,787 30,071,158 107,892,945 776,858 108,669,803 116,597,254
Net pension liability 5,913,141 1,521,353 7,434,494 33,461,054 40,895,548 31,316,118
Landfill closure costs — 5,204,000 5,204,000 — 5,204,000 5,094,036
Total liabilities 98,885,574 38,777,169 137,662,743 38,636,555 176,299,298 177,160,600
Deferred inflows of resources -
Pension deferrals 66,575 16,294 82,869 634,694 717,563 705,594
Net position:
Net investment in capital assets 80,857,151 40,098,010 120,955,161 843,065 121,798,226 120,384,649
Restricted for capital projects — — — — — 165,034
Unrestricted 48,293,582 9,584,434 57,878,016 (21,684,335) 36,193,681 44,847,177
Total net position 129,150,733 49,682,444 178,833,177 (20,841,270) 157,991,907 165,396,860
Total liabilities, deferred inflows
of resources and net position $ 228,102,882 88,475,907 316,578,789 18,429,979 335,008,768 343,263,054
See accompanying notes to financial statements.
(With summarized financial information for June 30, 2016)
June 30, 2017
Statement of Net Position
KODIAK ISLAND BOROUGH
of Resources and Net Position
Liabilities, Deferred Inflows
Outflows of Resources
Assets and Deferred
27
Program revenues Net (expense) revenue and changes in net position
Operating Primary government Component unit
Charges for grants and Capital Governmental Business-type School Total reporting entity
Functions/Programs Expenses services contributions grants activities activities Total District 2017 2016
Primary government:
Governmental activities:
General government $7,156,087 2,874,794 78,847 772,980 (3,429,466) — (3,429,466) — (3,429,466) (4,811,637)
Public safety 1,028,240 14,716 8,955 — (1,004,569) — (1,004,569) — (1,004,569) (771,150)
Community and economic development 1,136,303 — 49,415 — (1,086,888) — (1,086,888) — (1,086,888) (1,104,777)
Emergency preparedness 35,861 — 13,756 — (22,105) — (22,105) — (22,105) 886,634
Health and sanitation department 233,999 — — — (233,999) — (233,999) — (233,999) (389,000)
Education, culture and recreation 17,562 — — — (17,562) — (17,562) — (17,562) (23,949)
Parks and recreation 30,172 — — 33,389 3,217 — 3,217 — 3,217 37,584
Service district maintenance 475,248 111,146 — — (364,102) — (364,102) — (364,102) (560,138)
Primary and secondary education 14,162,868 — 235,177 79,124 (13,848,567) — (13,848,567) — (13,848,567) (13,943,965)
Interest on long-term debt 3,060,520 — 3,840,763 — 780,243 — 780,243 — 780,243 1,433,352
Total governmental activities 27,336,860 3,000,656 4,226,913 885,493 (19,223,798) — (19,223,798) — (19,223,798) (19,247,046)
Business-type activities:
Municipal solid waste collection and
disposal 3,296,817 3,105,560 20,887 — — (170,370) (170,370) — (170,370) (1,463,434)
Hospital facilities 1,284,657 660,000 — — — (624,657) (624,657) — (624,657) 26,285
Long Term Care Center 1,128,059 1,119,929 — — — (8,130) (8,130) — (8,130) —
Kodiak Fisheries Research Center 1,532,010 847,642 6,912 — — (677,456) (677,456) — (677,456) 1,812,390
911 service 28,409 — — — — (28,409) (28,409) — (28,409) (30,417)
Total business-type activities 7,269,952 5,733,131 27,799 — — (1,509,022) (1,509,022) — (1,509,022) 344,824
Total primary government 34,606,812 8,733,787 4,254,712 885,493 (19,223,798) (1,509,022) (20,732,820) — (20,732,820) (18,902,222)
Component unit:
School District $60,042,199 213,451 8,696,114 59,534 (51,073,100) (51,073,100) (50,072,141)
General revenues:
Property taxes 15,714,593 — 15,714,593 — 15,714,593 14,414,032
Grants and entitlements not restricted to specific programs 3,631,012 — 3,631,012 32,389,446 36,020,458 36,230,275
Land sales 325,793 — 325,793 — 325,793 27,683
Severance taxes 1,414,557 — 1,414,557 — 1,414,557 1,586,555
Support from primary government — — — 10,277,500 10,277,500 10,905,600
Investment earnings 271,691 177,851 449,542 — 449,542 840,454
Insurance proceeds — — — — — 403,958
Other 23,306 115,556 138,862 114,252 253,114 178,605
Loss on advanced refunding of debt — (54,590) (54,590) — (54,590) —
Transfers (1,134,372) 1,134,372 — — — —
Total general revenues and transfers 20,246,580 1,373,189 21,619,769 42,781,198 64,400,967 64,587,162
Change in net position 1,022,782 (135,833) 886,949 (8,291,902) (7,404,953) (4,387,201)
Net position, at beginning of year, as previously stated 128,127,951 49,818,277 177,946,228 (12,549,368) 165,396,860 169,524,737
Prior period adjustment — — — — — 259,324
Net position, at beginning of year, as restated 128,127,951 49,818,277 177,946,228 (12,549,368) 165,396,860 169,784,061
Net position, at end of year $129,150,733 49,682,444 178,833,177 (20,841,270) 157,991,907 165,396,860
See accompanying notes to financial statements.
KODIAK ISLAND BOROUGH
Statement of Activities
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
28
School Renewal
and Replacement
Education Facilities Bond
and Health Projects Other
Education Debt Service Capital Governmental
Assets General Support Facilities Fund Project Fund Funds 2017 2016
Assets:
Equity in central treasury $ 1,207,571 7,459,406 39,297,999 — 4,678,937 8,403,655 61,047,568 67,125,284
Receivables:
State of Alaska — 48,334 — 382,350 42,878 9,431 482,993 205,596
Federal government 230,082 — — — — 49,923 280,005 651,839
Property taxes, net of
allowance of $15,789 29,630 209,468 — 45,584 — 31,450 316,132 308,115
Severance taxes 376,432 — — — — — 376,432 376,393
Interest 192,190 — — — — — 192,190 273,218
Land sales contracts — — — — — 24,135 24,135 23,628
Accounts and other
receivables, net 37,003 — — — — 79,484 116,487 57,615
Prepaid items 32,349 — — — — 419,212 451,561 26,309
Due from other funds 995,538 — — — — — 995,538 414,830
Land sales contracts, due after one year — — — — — 360,657 360,657 181,191
Total assets $ 3,100,795 7,717,208 39,297,999 427,934 4,721,815 9,377,947 64,643,698 69,644,018
Liabilities:
Accounts payable 167,392 — — — 729,462 259,539 1,156,393 1,553,476
Accrued compensation
and related liabilities 270,833 — — — — — 270,833 239,072
Customer deposits — — — — — 27,450 27,450 27,450
Due to component unit — 7,785,248 — — — — 7,785,248 8,258,650
Due to other funds — — — 192,938 — 802,600 995,538 547,928
Advances from other funds — — — — — — — 2,474,938
Unearned revenues — — — — — 30,930 30,930 30,930
Total liabilities 438,225 7,785,248 — 192,938 729,462 1,120,519 10,266,392 13,132,444
Deferred inflows of resources:
Unavailable revenues 345,446 — — — — 384,792 730,238 535,944
Total liabilities and deferred
inflows of resources 783,671 7,785,248 — 192,938 729,462 1,505,311 10,996,630 13,668,388
Fund balances (deficit):
Nonspendable 32,349 — — — — 419,212 451,561 207,463
Committed — — 39,297,999 234,996 — 4,502,105 44,035,100 43,081,680
Assigned — — — — 3,992,353 3,073,997 7,066,350 11,312,217
Unassigned 2,284,775 (68,040) — — — (122,678) 2,094,057 1,374,270
Total fund balances (deficit) 2,317,124 (68,040) 39,297,999 234,996 3,992,353 7,872,636 53,647,068 55,975,630
Total liabilities, deferred inflows
of resources and fund balances $ 3,100,795 7,717,208 39,297,999 427,934 4,721,815 9,377,947 64,643,698 69,644,018
See accompanying notes to financial statements.
Liabilities, Deferred Inflows of Resources,
and Fund Balances (Deficit)
KODIAK ISLAND BOROUGH
Totals
Governmental Funds
Special Revenue Funds
(With summarized financial information for June 30, 2016)
June 30, 2017
Balance Sheet
29
Amount reported as fund balances on the governmental funds balance sheet $ 53,647,068
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 funds.163,160,050
Long-term receivables, delinquent property taxes and loans are
not available to pay for current-period expenditures and,
therefore, are unavailable in the funds:
Property taxes $345,446
Notes receivable - land sales 384,792 730,238
Long-term liabilities, including bonds payable, are not due and
payable in the current period and therefore are not reported
in the funds:
General obligation bonds payable (74,080,000)
Bond premium (8,222,899)
Accrued interest expense (1,156,282)
Compensated absences (242,398) (83,701,579)
Changes in deferred inflows and outflows of resources are the results
of timing differences in the acturial report:
Pension related assets in the current fiscal year are presented
as deferred outflows of resources 1,294,672
Pension related liabilities in the current fiscal year are presented
as deferred inflows of resources (66,575)
Proportionate share of the collective net pension liability (5,913,141)
Net position of governmental activities $ 129,150,733
See accompanying notes to financial statements.
KODIAK ISLAND BOROUGH
Reconciliation of Net Position Between the
June 30, 2017
Government-Wide Financial Statements and the Fund Financial Statements
30
School Renewal
and Replacement
Education Facilities Bond
and Health Projects Other
Education Debt Service Capital Governmental
General Support Facilities Fund Project Fund Funds 2017 2016
Revenues:
Property taxes and assessments $421,113 9,988,377 — 2,503,607 — 2,787,175 15,700,272 14,310,687
Transient accomodations tax — — — — — 108,050 108,050 95,466
Severance taxes 1,306,507 — — — — — 1,306,507 1,491,089
Intergovernmental:
State sources 1,915,963 235,177 — 3,840,763 50,000 92,435 6,134,338 8,870,802
Federal sources 1,822,194 — — — — 806,343 2,628,537 3,090,533
Charges for services 904 — — — — 790,882 791,786 698,024
Licenses, permits and fees 83,546 — — — — 2,125,324 2,208,870 67,401
Investment income 11,059 — 191,391 (608) 26,832 43,017 271,691 648,987
Rental — — — — — 14,160 14,160 8,800
Other 2,811 — — — — 6,335 9,146 45,422
Total revenues 5,564,097 10,223,554 191,391 6,343,762 76,832 6,773,721 29,173,357 29,327,211
Expenditures:
Current:
General government 4,063,887 — — 11 — 1,218,101 5,281,999 5,307,245
Public safety 109,415 — — — — 589,703 699,118 572,839
Community and
economic development 987,407 — — — — 109,521 1,096,928 1,069,639
Emergency preparedness 35,861 — — — — — 35,861 30,849
Health and social services 233,999 — — — — — 233,999 389,000
Education, culture
and recreation 17,562 — — — — — 17,562 23,949
Parks and recreation 30,172 — — — — — 30,172 87,456
Service district maintenance — — — — — 475,248 475,248 626,289
Primary and secondary education 96,000 10,277,548 — — — — 10,373,548 11,100,650
Capital outlay:
Schools — — — — 3,708,673 227,474 3,936,147 13,240,920
General — — — — — 1,086,817 1,086,817 3,430,975
Debt service:
Principal — — — 3,530,000 — — 3,530,000 3,201,002
Interest — — — 3,568,559 — — 3,568,559 3,194,612
Debt issuance costs — — — 64,313 — — 64,313 124,372
Total expenditures 5,574,303 10,277,548 — 7,162,883 3,708,673 3,706,864 30,430,271 42,399,797
Excess (deficiency) of revenues
over (under) expenditures (10,206) (53,994) 191,391 (819,121) (3,631,841) 3,066,857 (1,256,914) (13,072,586)
Other financing sources (uses):
Bond issuance — — — 4,905,000 — — 4,905,000 15,000,000
Premium on bonds issued — — — 806,205 — — 806,205 2,141,115
Payment to refunding escrow — — — (5,934,301) — — (5,934,301) —
Land sale proceeds — — — — — 145,820 145,820 110,428
Proceeds from sale of capital assets — — — — — 140,000 140,000 —
Insurance proceeds — — — — — — — 403,958
Transfers in — — — 1,059,380 — 698,656 1,758,036 1,404,497
Transfers out (958,451) — (438,313) — — (1,495,644) (2,892,408) (1,454,725)
Net other financing
sources (uses)(958,451) — (438,313) 836,284 — (511,168) (1,071,648) 17,605,273
Change in fund balances (968,657) (53,994) (246,922) 17,163 (3,631,841) 2,555,689 (2,328,562) 4,532,687
Fund balances (deficit),
at beginning of year, as previously stated 3,285,781 (14,046) 39,544,921 217,833 7,624,194 5,316,947 55,975,630 51,183,619
Prior period adjustment — — — — — — — 259,324
Fund balances (deficit),
at beginning of year, as restated 3,285,781 (14,046) 39,544,921 217,833 7,624,194 5,316,947 55,975,630 51,442,943
Fund balances (deficit), at end of year $ 2,317,124 (68,040) 39,297,999 234,996 3,992,353 7,872,636 53,647,068 55,975,630
See accompanying notes to financial statements.
Totals
Special Revenue Funds
KODIAK ISLAND BOROUGH
Statement of Revenues, Expenditures and Changes
in Fund Balances (Deficit)
Governmental Funds
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
31
KODIAK ISLAND BOROUGH
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Year ended June 30, 2017
Change in fund balances – total governmental funds $ (2,328,562)
Amounts reported for governmental activities in the statement of
activities are different because:
Governmental funds report capital outlays as expenditures.
However, in the Statement of Activities the cost of those assets
is allocated over their estimated useful lives and reported as
depreciation expense:
Capital outlay $3,978,528
Depreciation expense (3,776,573) 201,955
Governmental funds only report the revenue from the sale of
assets to the extent proceeds are received from the sale. In
the Statement of Activities, a gain or loss is reported for each
sale or disposal. The net effect of transactions involving capital
assets is to decrease net position.
Cost of assets disposed (486,386)
Accumulated depreciation of assets disposed 215,207 (271,179)
Certain revenues in the statement of activities do not provide
current financial resources and are reported as unearned or
unavailable revenues in the funds:
Property tax 345,446
Land sale proceeds 384,792 730,238
Certain revenues that were earned in a prior year provide
current financial resources:
Accrued property tax (331,125)
Land sale contracts (204,819) (535,944)
The issuance of long-term debt provides current financial
resources to governmental funds, while the repayment of the
principal of long-term debt consumes the current financial
resources of governmental funds. Neither transaction, however,
has any effect on net position. Also, governmental funds do not
report the accrual of interest expense on debt when it is not
payable from currently available resources:
Interest expenditures applied to accrued interest 82,377
Issuance of long term debt (5,711,205)
Principal repayments 9,150,000
Bond premium amortization 739,963 4,261,135
Some expenses reported in the Statement of Activities do not
require the use of current financial resources and; therefore,
are not reported as expenditures in governmental funds:
Change in compensated absences (4,641)
Change in the proportionate share of the unfunded net pension liability (1,476,613)
Changes in deferred inflows and outflows of resources are the result
of timing difference in the actuarial report and adjustments to reflect
employer and non-employer contributions based on the measurement
date of the liability.446,393
Change in net position of governmental activities $
1,022,782
See accompanying notes to financial statements.
of Governmental Funds to the Statement of Activities
32
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2017 2016
Current assets:
Equity in central treasury $7,570,700 1,090,240 2,276,875 2,036,604 22,258 12,996,677 11,841,010
Restricted cash and equivalents 302,503 — 983,151 — — 1,285,654 1,649,190
Customer receivables 292,410 — — 124,341 4,598 421,349 529,622
Accounts receivable -
State of Alaska — — — — — — 2,567
Current portion of note receivable — — — 114,135 — 114,135 110,215
Due from other funds — — — — — — 138,017
Total current assets 8,165,613 1,090,240 3,260,026 2,275,080 26,856 14,817,815 14,270,621
Inventories 416,740 277,007 — — — 693,747 693,747
Capital assets:
Non-depreciable 30,099,425 26,342 — — — 30,125,767 29,510,629
Depreciable, net 2,508,892 14,642,107 15,005,809 8,830,031 — 40,986,839 43,562,727
Total capital assets 32,608,317 14,668,449 15,005,809 8,830,031 — 71,112,606 73,073,356
Note receivable — — — 1,515,401 — 1,515,401 1,629,536
Advances to other funds — — — — — — 2,474,938
Total noncurrent assets 33,025,057 14,945,456 15,005,809 10,345,432 — 73,321,754 77,871,577
Pension deferrals 247,989 — — 88,349 — 336,338 215,062
Total assets and deferred
outflows of resources $41,438,659 16,035,696 18,265,835 12,708,861 26,856 88,475,907 92,357,260
Current liabilities:
Accounts payable $218,801 3,013 — 23,999 26,856 272,669 216,713
Customer deposits 49,968 — — — — 49,968 42,468
Accrued compensation and
related liabilities 88,479 — — 11,287 — 99,766 120,174
Unearned revenue — 60,000 95,277 — — 155,277 —
Interest payable 459,540 — — — — 459,540 240,546
Current portion of notes and bonds payable 453,438 — 490,000 — — 943,438 1,088,438
Due to other funds — — — — — 4,919
Total current liabilities 1,270,226 63,013 585,277 35,286 26,856 1,980,658 1,713,258
Noncurrent liabilities:
Notes payable 18,686,287 — 11,384,871 — — 30,071,158 34,602,921
Accrual for landfill closure
and postclosure costs 5,204,000 — — — — 5,204,000 5,094,036
Net pension liability 1,122,739 — — 398,614 — 1,521,353 1,109,132
Total noncurrent liabilities 25,013,026 — 11,384,871 398,614 — 36,796,511 40,806,089
Total liabilities 26,283,252 63,013 11,970,148 433,900 26,856 38,777,169 42,519,347
Deferred inflows of resources -
Pension deferrals 12,083 — — 4,211 — 16,294 19,636
Net position:
Net investment in capital assets 13,468,592 14,668,449 3,130,938 8,830,031 — 40,098,010 41,911,154
Restricted for capital projects — — — — — — —
Unrestricted 1,674,732 1,304,234 3,164,749 3,440,719 — 9,584,434 7,907,123
Total net position 15,143,324 15,972,683 6,295,687 12,270,750 — 49,682,444 49,818,277
Total liabilities, deferred inflows
of resources and net position $ 41,438,659 16,035,696 18,265,835 12,708,861 26,856 88,475,907 92,357,260
See accompanying notes to financial statements.
KODIAK ISLAND BOROUGH
Deferred outflows of resources -
of Resources and Net Position
Proprietary Funds - Business - Type Activities - Enterprise Funds
Statement of Net Position
(With summarized financial information for June 30, 2016)
June 30, 2017
Outflows of Resources
Assets and Deferred
Liabilities, Deferred Inflows
33
KODIAK ISLAND BOROUGH
Statement of Revenues, Expenses, and Changes in Net Position
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2017 2016
Operating revenues:
Charges for services:
Solid waste disposal $3,105,560 — — — — 3,105,560 2,859,436
Lease income — 660,000 1,119,929 847,642 — 2,627,571 5,313,545
Other 11,390 — 16,623 — 28,409 56,422 46,731
Total operating revenues 3,116,950 660,000 1,136,552 847,642 28,409 5,789,553 8,219,712
Operating expenses:
Personnel services 1,319,809 42,436 — 386,036 1,500 1,749,781 1,622,822
Contracted services 303,846 — — — — 303,846 195,581
Maintenance and repairs 106,058 — — 57,869 — 163,927 58,857
Depreciation 294,025 1,121,711 518,933 702,501 — 2,637,170 2,121,319
General and administration 463,071 12,510 43,649 378,075 — 897,305 711,777
Miscellaneous — — — 7,529 53 7,582 53,971
Telephone services — — — — 26,856 26,856 28,819
Recycling services 252,960 — — — — 252,960 248,244
Closure and postclosure costs 154,010 — — — — 154,010 2,030,954
Contributions 35,880 — — — — 35,880 34,885
Total operating expenses 2,929,659 1,176,657 562,582 1,532,010 28,409 6,229,317 7,107,229
Operating income 187,291 (516,657) 573,970 (684,368) — (439,764) 1,112,483
Nonoperating revenues (expense):
Intergovernmental:
Federal sources — — — — — — 375,468
State of Alaska on-behalf payment 20,887 — — 6,912 — 27,799 53,110
Contribution to Providence Hospital — (108,000) — — — (108,000) (108,000)
Investment income 30,576 136,828 75 10,372 — 177,851 236,180
Debt issuance costs — — (11,500) — — (11,500) —
Loss on advanced refunding of debt — — (54,590) — — (54,590) —
Gain on sale of assets — — — — — — 16,000
Interest revenue — — — 59,134 59,134 —
Interest expense (367,158) — (553,977) — — (921,135) (1,052,832)
Total nonoperating income (expense)(315,695) 28,828 (619,992) 76,418 — (830,441) (480,074)
Income before capital contributions,
transfers, and special items (128,404) (487,829) (46,022) (607,950) — (1,270,205) 632,409
Capital contributions — — — — — — 11,326
Transfers in — 1,089,372 8,062,822 45,000 — 9,197,194 66,500
Transfers out — (8,062,822) — — — (8,062,822) (16,272)
Total capital contributions and transfers — (6,973,450) 8,062,822 45,000 — 1,134,372 61,554
Special item:
Gain (loss) on transfer of Long Term
Care Center operations (Note 16)— 1,721,113 (1,721,113) — — — —
Change in net position (128,404) (5,740,166) 6,295,687 (562,950) — (135,833) 693,963
Net position, at beginning of year 15,271,728 21,712,849 — 12,833,700 — 49,818,277 49,124,314
Net position, at end of year $ 15,143,324 15,972,683 6,295,687 12,270,750 — 49,682,444 49,818,277
See accompanying notes to financial statements.
Proprietary Funds - Business - Type Activities - Enterprise Funds
34
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2017 2016
Cash flows from operating activities:
Cash received from customers $3,251,637 722,567 1,231,829 938,622 28,730 6,173,385 6,953,268
Payments to suppliers (1,125,641) (9,532) (43,649) (497,571) (53) (1,676,446) (2,278,590)
Payments to employees (1,109,975) (42,436) — (328,675) (1,500) (1,482,586) (1,453,313)
Net cash provided (used) by
operating activities 1,016,021 670,599 1,188,180 112,376 27,177 3,014,353 3,221,365
Cash flows from noncapital financing activities:
State sources - grants 20,887 — — 6,912 — 27,799 53,110
Federal sources - grants — — — — — — 375,468
Contribution to Providence Hospital — (108,000) — — — (108,000) (108,000)
Net change in interfund receivable/payable — 138,017 — — (4,919) 133,098 86,986
Transfers in — 1,089,372 8,062,822 45,000 — 9,197,194 66,500
Transfers out — (8,062,822) — — — (8,062,822) (16,272)
Net cash provided (used) by noncapital
financing activities 20,887 (6,943,433) 8,062,822 51,912 (4,919) 1,187,269 457,792
Cash flows from capital and related
financing activities:
Acquisition and construction of capital assets (676,420) — — — — (676,420) (3,417,474)
Capital contributions — — — — — — 11,326
Interest paid on notes payable and
interfund borrowings (148,164) — (608,567) — — (756,731) (896,230)
Principal payments on notes payable
and interfund borrowings (443,437) 2,474,938 (5,370,984) — — (3,339,483) (4,102,728)
Refunding costs — — (11,500) — — (11,500) —
Proceeds from sale of assets — — — — — — 16,000
Proceeds from issuance of notes payable 1,137,658 — — — — 1,137,658 9,346,226
Net cash provided (used) by capital and
related financing activities (130,363) 2,474,938 (5,991,051) — — (3,646,476) 957,120
Cash flows from investing activities:
Interest and dividends received 30,576 136,828 75 69,506 — 236,985 236,180
Net change in cash and
cash equivalents 937,121 (3,661,068) 3,260,026 233,794 22,258 792,131 4,872,457
Cash and equivalents, at beginning of year 6,936,082 4,751,308 — 1,802,810 — 13,490,200 8,617,743
Cash and equivalents, at end of year $ 7,873,203 1,090,240 3,260,026 2,036,604 22,258 14,282,331 13,490,200
Reconciliation of cash and cash equivalents
to the Statement of Net Position:
Equity in central treasury $ 7,570,700 1,090,240 2,276,875 2,036,604 22,258 12,996,677 11,841,010
Restricted cash and equivalents 302,503 — 983,151 — — 1,285,654 1,649,190
$7,873,203 1,090,240 3,260,026 2,036,604 22,258 14,282,331 13,490,200
(continued)
Proprietary Funds - Business - Type Activities - Enterprise Funds
(With summarized financial information for the year ended June 30, 2016)
Year ended June 30, 2017
Statement of Cash Flows
KODIAK ISLAND BOROUGH
35
KODIAK ISLAND BOROUGH
Statement of Cash Flows
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2017 2016
Reconciliation of operating income (loss) to net
cash provided by operating activities:
Operating income (loss)$187,291 (516,657) 573,970 (684,368) — (439,764) 1,112,483
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:
Depreciation 294,025 1,121,711 518,933 702,501 — 2,637,170 2,121,319
Pension expense 210,690 — — 76,913 — 287,603 149,191
Accrual for landfill closure and
postclosure costs 109,964 — — — — 109,964 1,905,529
Changes in assets and liabilities that
provided (used) cash:
(Increase) decrease in assets:
Customer receivables 127,187 — — (19,235) 321 108,273 463,994
Accounts receivable - State of Alaska — 2,567 — — — 2,567 3,354
Prepaids — — — — — — —
Inventories — — — — — — 104,185
Notes receivable — — — 110,215 110,215 (1,739,751)
Increase (decrease) in liabilities:
Accounts payable 80,220 2,978 — (54,098) 26,856 55,956 (924,496)
Customer deposits 7,500 — — — — 7,500 5,959
Accrued compensation (856) — — (19,552) — (20,408) 20,318
Other accrued liabilities — 60,000 95,277 — — 155,277 (720)
Net cash provided (used) by
operating activities $1,016,021 670,599 1,188,180 112,376 27,177 3,014,353 3,221,365
See accompanying notes to financial statements.
Proprietary Funds - Business - Type Activities - Enterprise Funds, (Continued)
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
36
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements
Year Ended June 30, 2017
37
(1) Summary of Significant Accounting Policies
(a) Reporting Entity
The Kodiak Island Borough (the Borough), Alaska, was organized to perform the municipal duties
allowed by Alaska Statutes and as directed by its residents. As required by accounting principles
generally accepted in the United States of America, these financial statements present the government
and its component unit, an entity for which the government is considered to be financially accountable.
The discretely presented component unit is reported in a separate column in basic financial statements
to emphasize it is legally separate from the government. The Borough reviewed its relationship with
other organizations and determined that the following organization is a component unit.
Discretely Presented Component Unit
The Kodiak Island Borough School District (KIBSD) is a legally separate governmental entity, which
is responsible for public education within the Borough. Members of the School Board are elected by
the voters; however, the Borough imposes its will over KIBSD because the Borough Assembly has
the authority to approve and/or alter the total budget of KIBSD. The Borough also must levy the
necessary taxes, and issue bonds for KIBSD. KIBSD has a June 30 fiscal year end, therefore, the
financial information presented in these financial statemetns is as of and for the fiscal year ended June
30, 2017.
Complete financial statements for the component unit may be obtained at the entity’s administrative
offices for the Kodiak Island Borough School District.
Kodiak Island Borough School District
722 Mill Bay Road
Kodiak, Alaska 99615
(b) Government-Wide and Fund Financial Statements
The government wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the activities of the primary government and its component unit.
For the most part, the effect of inter-fund activity has been removed from these statements.
Governmental activities, which normally are supported by taxes and intergovernmental revenues, are
reported separately from business type activities, which rely to a significant extent on fees and charges
for support. Likewise, the primary government is reported separately from the legally separate
component unit for which the primary government is financially accountable.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
38
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.
Separate financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds and major individual enterprise funds, if applicable, are reported as
separate columns in the fund financial statements.
Deferred inflows of resources are the acquisition of fund balance / net position by the Borough that
are applicable to a future reporting period. Deferred outflows of resources are the consumption of
fund balance / net position that are applicable to a future reporting period.
(c) Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement
focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues
are recorded when earned and expenses are recorded when a liability is incurred, regardless of the
timing of related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements have
been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are 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.
For this purpose, the government considers revenues to be available if they are collected within 60 days
of the end of the current fiscal period except for grant revenues which are recognized when the related
expenditure is incurred irrespective of when the cash is received. Expenditures generally are recorded
when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well
as expenditures related to compensated absences and claims and judgments, are recorded only when
payment is due.
Property taxes and interest associated with the current fiscal period are all considered to be susceptible
to accrual and 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 government.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
39
The government reports the following major governmental funds:
The General Fund is the government’s primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in another fund.
The Education Support Special Revenue Fund accounts for property taxes and assessments
dedicated to Borough support activity.
The Facilities Special Revenue Fund accounts for the proceeds from the sale of Shuyak Island.
The single most important goal is to preserve the principal of the fund. Interest earnings, after
inflation proofing, can be used for debt service, building insurance and capital projects.
The Education and Health Debt Service Fund was established to finance and account for the
payment of interest and principal on all general obligation debts, serial and term, other than that
payable exclusively from special assessments and revenue debt issued for and serviced by a
government enterprise fund.
The School Renewal and Replacement Facilities Bond Projects Capital Project Fund accounts for
construction and maintenance for the Borough’s educational facilities funded by bonds.
The government reports the following major proprietary funds:
The Municipal Solid Waste Collection and Disposal Fund accounts for the collection and disposal
of solid waste and recycling services for the Kodiak Island Borough.
The Hospital Facilities Fund accounts for rents on the Borough owned hospital; hospital related
state revenue sharing; and other hospital related revenue. In turn, it purchases hospital equipment
when needed.
The Long Term Care Center Fund was created in fiscal year 2017 to account for the rents on the
Borough owned Long Term Care Center and debt service payments on related debt. These
activities were accounted for in the Hospital Facilities Fund until completion of the Long Term
Care Center.
The Kodiak Fisheries Research Center Fund accounts for rents and expenses on the Borough
owned Kodiak Fisheries Research Center. Multiple tenants pay lease funds to participate in this
multi-agency research facility committed to the preservation of the North Pacific marine
ecosystem and resources.
As a general rule the effect of inter-fund activity has been eliminated from the government wide
financial statements. Exceptions to this general rule are charges between various 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 or applicants for goods,
services, or privileges provided, (2) operating grants and contributions, and (3) capital grants and
contributions. Internally dedicated resources are reported as general revenues rather than as program
revenues. Likewise, general revenues include all taxes.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
40
Proprietary funds distinguish operating revenues and expenses from nonoperating 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 are charges to customers for sales and services and lease revenues. Operating
expenses for enterprise 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
nonoperating revenues and expenses.
(d) Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Fund
Balance/Net Position
Cash and Investments
Cash and temporary investments of Borough funds are pooled in a central treasury. Each fund’s portion
of this pool is displayed on the Balance Sheet and Statement of Net Position as “Equity in Central
Treasury”.
The Borough participates in the Alaska Municipal League Investment Pool (AMLIP). AMLIP is not
SEC registered and is unrated. Alaska Statute 37.23 establishes regulatory oversight of the pool. The
law sets forth numerous requirements regarding authorized investments and reporting. The pool is
incorporated in the State of Alaska as a nonprofit corporation and reports to its Board of Directors.
Alaska Statute 37.23.050 requires the retention of an investment manager.
The AMLIP manager is required to produce monthly disclosure statements to the pool. The pool has
also retained an investment advisor to monitor the performance of the investment manager and to
ensure compliance with investment policies. All participation in the pool is voluntary. The pool must
maintain a dollar weighted average maturity of 90 days or less, and only purchase instruments having
remaining maturities of 397 days or less. On a monthly basis, the investments in the pool are reviewed
for fair value by an independent pricing service.
All highly liquid investments, excluding restricted assets, with original maturities of ninety days or
less are considered to be cash equivalents. For purposes of the Statements of Cash Flows, equity in
central treasury held by enterprise funds are treated as cash equivalents.
Investments for the government, as well as the component unit, are reported at fair value, as determined
by quoted market prices. The reported value of the pool is the same as the fair value of the pool shares.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
41
Fair Value of Financial Instruments
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. The following financial instruments
are recorded at fair value or at amounts that approximate fair value: (1) cash and cash equivalents, (2)
receivables, net, (3) certain other current assets, (4) accounts payable, and (5) other current liabilities.
The carrying amounts reported in the Balance Sheet and Statement of Net Position for the above
financial instruments closely approximates their fair value due to the short-term nature of these assets
and liabilities, except for the Borough’s investments. The carrying amount of the Borough’s
investments are determined based on quoted market prices.
The carrying amount of notes receivable and notes payable approximates fair value for those financial
instruments with interest at variable rates, as those rates approximate current market rates for notes
with similar maturities and credit quality.
Receivables and Payables
Activity between funds that are representative of lending /borrowing arrangements outstanding at the
end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of
inter-fund loans) or “advances to/from other funds” (i.e., the noncurrent portion of inter-fund loans).
Any residual balances outstanding between the governmental activities and business type activities are
reported in the government wide financial statements as “internal balances.”
Advances between funds, as reported in the fund financial statements, are offset by a fund balance
reserve account in applicable governmental funds to indicate that they are not available for
appropriation and are not expendable available financial resources.
Inventories and Prepaid Items/Expenses
Enterprise Fund inventories consist of rock and various supplies. Inventories are valued at the lower
of cost (first-in, first-out) or market (net realizable value) and are recorded as expenses when consumed
rather than when purchased. The entire Hospital Enterprise Fund inventory is assigned to Providence
as of April 21, 1997. According to the terms of the lease agreement for the hospital facilities [see note
14(a)], those items are required to be returned to the Borough at the termination of the lease in at least
equal value.
Payments made to vendors for services that are applicable to future accounting periods are recorded
as prepaid items. The prepaid assets do not reflect current available resources and, thus, an equivalent
portion of fund balance is classified as nonspendable in the fund financial statements. Prepaid items
and expenses are based on the consumption method.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
42
Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, street
lights, and similar items including those acquired prior to fiscal years ended after June 30, 1980), are
reported in the applicable governmental or business type activities columns in the government-wide
financial statements. Capital assets are defined by the Borough as assets with an initial, individual cost
of more than $5,000 (amount not rounded) and an estimated useful life in excess of two years. 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.
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. There was no interest capitalized during the year.
Property, plant, and equipment of the primary government is depreciated using the straight line method
over the following estimated useful lives:
Buildings and improvements 10-40 years
Improvements other than buildings 10-15 years
Equipment 5-10 years
Infrastructure 40 years
Compensated Absences
It is the Borough’s policy to permit employees to accumulate earned but unused annual leave benefits.
All annual leave pay is accrued when incurred in the government wide and proprietary fund financial
statements. A liability for these amounts is reported in governmental funds only if they have matured,
for example, as a result of employee resignations and retirements.
Long-term Obligations
In the government wide 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 Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life
of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond
premium or discount. Bond issuance costs are expensed in the year incurred.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
43
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. Interest on
long-term obligations is recorded as an expenditure when due.
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred
inflows of resources related to pensions, and pension expense, information about the fiduciary net
position of the Public Employees’ Retirement System (PERS) and additions to/from PERS’s fiduciary
net position have been determined on the same basis as they are reported by PERS. For this purpose,
benefit payments (including refunds of employee contributions) are recognized when due and payable
in accordance with the benefit terms, investments are reported at fair value.
Net Position
In the government wide financial statements, net position is reported in three categories; net investment
in capital assets, restricted net position and unrestricted net position.
Net position is reported as restricted when constraints placed on net asset use are either externally
imposed by creditors (such as through debt covenants), grantors, contributors provisions or laws or
regulations of other governments or imposed by law through constitutional provisions or enabling
legislation.
Fund Balance
In the Fund Financial Statements, fund balance includes five classifications as follows:
Nonspendable Fund Balance – amounts that are legally or contractually required to be maintained intact
(such as the corpus of an endowment fund) or amounts that are not in a spendable form (such as
inventory, prepaid expenses, supplies, and long-term receivables). Such constraint is binding until the
legal or contractual requirement is repealed or the amounts become spendable.
Restricted Fund Balance – amounts constrained to specific purposes by their providers (such as grantors
and higher levels of government), through constitutional provisions, or by enabling legislation. Such
constraint is binding unless modified or rescinded by external body, laws, or regulation.
Committed Fund Balance – amounts that can be used only for the specific purposes determined by a
formal action of the Borough Assembly, the Borough’s highest level of decision-making authority.
Commitments may be changed or lifted by the Assembly taking the same formal action that imposed the
constraint originally. The formal action that is required to be taken to establish, modify or rescind a fund
balance commitment is for the Assembly to pass a resolution.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
44
Assigned Fund Balance – amounts that are constrained by the Borough for specific purposes. In
governmental funds other than the General Fund, assigned fund balance represents the amount that is not
restricted or committed, but constrained for a specific purpose. Assignment of fund balance is made by
the Borough Assembly or its designee, the Finance Director. Such constraint is binding unless modified
or eliminated by the Borough Assembly or Finance Director. Assignment of fund balance is made during
the budget process and reviewed at the end of the fiscal year. Assigned fund balance for FY2016
represents amounts constrained for capital project funds and was assigned by the Finance Director.
Unassigned Fund Balance – amounts not contained in the other classifications and available for any
purpose. Positive unassigned amounts will be reported only in the General Fund. If another
governmental fund, other than the General Fund, has a fund balance deficit, then it will be reported as a
negative amount in the unassigned classification in that fund.
The order of spending, regarding the restricted and unrestricted fund balance when an expenditure is
incurred for which both restricted and unrestricted fund balance is available should first reduce restricted
fund balance and then unrestricted fund balance. The order of spending regarding unrestricted fund
balance is that committed amounts should be reduced first, followed by the assigned amounts, and then
the unassigned amounts when expenditures are incurred for purposes for which amounts in any of those
unrestricted fund balance classifications could be used.
Compliance with the provisions of the Fund Balance Classification Policy are reviewed as part of the
annual budget adoption process. The Finance Director reports to the Assembly as close to the end of the
year as possible the anticipated year-end fund balance or deficit. The Assembly takes appropriate action
to commit or assign, or otherwise allocate prior year fund balances as a part of the budget planning
process.
The Borough’s Special Revenue Funds are used to account for Borough support, fire and road service
areas, federal and state grant programs, street lighting Boroughs, and operations and maintenance
programs that are restricted or committed.
(e) Revenues, Expenditures, and Expenses
Property Taxes
Property taxes are based on the assessed value of taxable property as of January 1. Pursuant to Alaska
Statute 29.45.240, the Borough establishes the mill rate on or before June 15th. Tax bills are then
mailed on or before July 1st.
Taxes are due when billed and generally become delinquent on or after October 16th. The Borough
code also provides for split payments. If a taxpayer avails himself of this provision, one-half must be
paid on or before August 15th and the remainder becomes due on or before November 15th (in lieu of
October 15th). Borough property tax revenues are recognized in the fiscal year in which they are
levied.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
45
All taxes are delinquent on November 16th, and a tax foreclosure process may commence as outlined
in Alaska Statutes Title 29. Briefly, this entails the petition for Judgment of Foreclosure signed by the
Borough Court Judge and the publication of all delinquent taxes in the local newspaper for four
consecutive weeks.
Real property tax liens are enforced by one general foreclosure proceeding against the delinquent
properties.
Prior to FY2012 all area wide property taxes were deposited into the General Fund and then transferred
to the other area wide funds. As of FY2012 the Borough has set a separate mill rate for each area wide
function that was funded by property taxes. For FY2017 the Borough set a mill rate of 0.1 mills for
the General Fund, 8.45 mills for the Education Support Special Revenue Fund, 1.7 mills for the Debt
Service Fund and 0.5 mills for the Renewal and Replacement Projects Capital Project Fund for a total
area wide mill rate of 10.75. This was the same mill rate as FY2016.
Severance Taxes
Severance taxes are based on the amount and value of natural resources severed from the environment.
Types of resources taxed include seafood, gravel and mineral resources, and timber. Severance tax
returns are sent to appropriate companies (as determined by the Borough Assessor) and are returned
to the Borough Finance Department. The returns are filed quarterly, and are due by the end of the
month following the quarter’s end. Borough severance tax revenues are recognized in the fiscal year
in which they become measurable and available.
Intergovernmental Revenue
State shared revenues, safe communities, State education related entitlement programs and State levied
taxes, the proceeds of which are distributed to local governments, are recorded in the fiscal year to
which they relate, including accrual at year end if final payments due are measurable and received
within approximately two months after year end.
State of Alaska and Federal government cost reimbursable grants and contracts are recorded to the
extent of allowable expenditures in the period in which the expenditures were incurred.
When both restricted and unrestricted resources are available for use for governmental activities, it is the
Borough’s policy to use restricted resources first, then unrestricted resources as they are needed.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
46
Operating and Nonoperating Revenue and Expenses
Proprietary funds distinguish operating revenues and expenses from nonoperating 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 Municipal Solid Waste Collection and Disposal Fund and 911 Service Fund are charges to
customers for services. The principal operating revenues of the Hospital Facilities Fund, Long Term
Care Center Fund, and the Kodiak Fisheries Research Center Fund are rents from customers. Operating
expenses for proprietary funds include costs of services, administrative expenses, and depreciation on
capital assets. All revenues and expenses not meeting this definition are reported as nonoperating
revenues and expenses.
Revenue from Investments and Property
Amounts earned on investment of available cash balances and the rental of building facilities are
recorded in the period to which they relate, including accrual at year end of the balance due, and
unrealized gains and losses on investments held at fiscal year end.
Land Sales Proceeds and Other Local Revenues
Amounts received pursuant to land sale contracts are recorded on the modified accrual basis in the
fund financial statements and the accrual basis in the government-wide financial statements.
Other local revenues are recorded on a basis consistent with their nature in relation to measurement
and availability standards.
(f) Cash Flows
All highly liquid investments, excluding restricted assets, with original maturities of three months or
less are considered cash equivalents for purposes of the statement of cash flows.
(g) Use of Estimates
Preparation of financial statements in accordance with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect the
amounts reported in these financial statements. Actual results may differ from the estimates.
Significant estimates include the allowance for doubtful accounts, the useful lives of assets and related
accumulated depreciation, and accrued landfill closure and post-closure care costs.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
47
(2) Stewardship, Compliance, and Accountability
(a) Excess of Expenditures over Appropriations
The following fund expenditures exceeded their budget:
Fund Excess
Special Revenue Funds:
Education Support
Womens Bay Road Service Area
$ 48
22,488
Debt Service – Education and Health 26,561
Total expenditures exceeding budgets $ 49,097
(b) Deficit Fund Equity
The individual fund deficits at June 30, 2017, are as follows:
Special Revenue Funds:
Education Support $ 68,040
Capital Project Fund:
Renewal and Replacement Projects 122,678
Total fund deficits $ 190,718
The deficits in the Education Support Fund and Renewal and Replacement Capital Projects Fund will be
funded by transfers in from the General Fund in FY2018.
(3) Cash and Investments
A portion of the Borough’s investments are in the Alaska Municipal League Investment Pool (AMLIP). The
investment in AMLIP represents the Borough’s share of ownership in the pool rather than ownership of
specific securities. The fair values of the investments in the pool approximates amortized cost and is equal
to the value of pool shares. To obtain a copy of AMLIP’s financial statements contact Key Trust of Alaska
at 101 West Benson Blvd., Room 302, Anchorage, Alaska 99503.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
48
As of June 30, 2017, the Borough had the following investments:
Investment Maturities (in years)
Fair Less
Investment Type Value than 1 1 to 5 6 to 10
U.S. Agency Securities:
Federal Home Loan Bank $ 10,052,460 6,073,080 3,979,380 -
Federal Home Loan
Mortgage Corporation 11,958,340 - 11,958,340 -
U.S. Treasury Notes
Federal National Mortgage
3,994,480 3,994,480 - -
Association 2,850,085 2,850,085 - -
Municipal Obligations 4,582,391 156,722 3,172,374 1,253,295
Alaska Municipal League
Investment Pool 9,723,709 9,723,709 - -
Certificates of Deposit 1,681,757 959,345 722,412 -
$ 44,843,222 23,757,421 19,832,506 1,253,295
In addition to the investments listed above, Kodiak Island Borough also had cash equivalents of $30,486,677,
which includes restricted cash of $1,285,654.
The Borough categorizes its 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. The Borough has the
following recurring fair value measurements as of June 30, 2017:
Total Level 1 Level 2 Level 3
Investments by fair value level:
Debt securities:
U.S. Agency Securities $ 28,855,365 28,855,365 - -
Municipal Obligations 4,582,391 - 4,582,391 -
Total debt securities 33,437,756 28,855,365 4,582,391 -
Other investments:
Alaska Municipal League
Investment Pool 9,723,709 - 9,723,709 -
Certificates of Deposit 1,681,757 - 1,681,757 -
Total other investments 11,405,466 - 11,405,466 -
Total investments $ 44,843,222 28,855,365 15,987,857 -
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
49
Interest Rate Risk
The Borough’s investment policy does not limit investment maturities as a means of managing its exposure
to fair value losses arising from increasing interest rates.
Credit Risk
Statutes authorize the Borough to invest in obligations of the United States, the State of Alaska and its
political subdivisions, savings accounts, certificates of deposit, banker’s acceptances, repurchase
agreements, and such other legal security instruments. The Borough does not have a formal investment
policy that restricts investments based on credit risk.
At June 30, 2017, the Borough’s investments in municipal obligations and U.S. Government agencies or
instruments implicitly guaranteed by the U.S. Government were rated as follows:
S&P
AAA 16%
AA+ 75%
AA 4%
AA- 5%
100%
At June 30, 2017, the Borough’s investment in the Alaska Municipal League Investment Pool and
Certificates of Deposit were unrated.
Concentration of Credit Risk
The Borough places no limit on the amount the Borough may invest in any one issuer. At June 30, 2017,
the Borough had 64% percent of its investments in U.S. Government agency securities.
Custodial Credit Risk – Deposits
The Borough maintains a cash pool that is available for use by all funds. Each fund’s portion of this pool is
reported on the Balance Sheet and Statements of Net Position as “Equity in Central Treasury” or amounts
“due to/from other funds.”
The Borough bank accounts are insured by the Federal Depository Insurance Corporation (FDIC) to a
maximum of $250,000. U.S. Treasury obligations, which are held by Bank of New York in a Tri-party
collateral agreement with Wells Fargo, the pledging financial institution’s agent, in the Borough’s name,
collateralize a portion of the remaining bank balance. At year end, $263,467 was uninsured.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
50
Custodial Credit Risk – Investments
For an investment, this is a risk that, in the event of the failure of the counterparty, the Borough will not be
able to recover the value of its investments or collateral securities that are in the possession of an outside
party. The Borough manages its custodial credit risk in investments by requiring collateralization
agreements. The Borough had no debt securities exposed to custodial credit risk at June 30, 2017.
(4) Annual Appropriation to the School District
An annual appropriation is made to the School District. In addition to the annual appropriation, the Borough
provides the School District general liability and property insurance, the annual independent audit, mental
health services, and grounds maintenance services.
(5) Receivables
School
Renewal and
Replacement
Education Education and Facilities Bond Other Total
General Support Special Health Debt Projects Capital Governmental Governmental
Fund Revenue Fund Service Fund Project Fund Funds Funds
Receivables:
Grants $ 230,082 48,334 382,350 42,878 59,354 762,998
Taxes 421,851 209,468 45,584 — 31,450 708,353
Interest 192,190 — — — — 192,190
Customers and other 37,003 — — — 79,484 116,487
Notes receivable — — — — 384,792 384,792
Gross receivables 881,126 257,802 427,934 42,878 555,080 2,164,820
Less: allowance
for uncollectibles (15,789) — — — — (15,789)
Net total receivables $ 865,337 257,802 427,934 42,878 555,080 2,149,031
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor Total Total
Collection Research Enterprise Enterprise Primary
and Disposal Center Fund Funds Government
Receivables:
Grants $ — — — — 762,998
Taxes — — — — 708,353
Interest — — — — 192,190
Customers and other 292,410 124,341 4,598 421,349 537,836
Notes receivable — 1,629,536 — 1,629,536 2,014,328
Gross receivables 292,410 1,753,877 4,598 2,050,885 4,215,705
Less: allowance
for uncollectibles — — — — (15,789)
Net total receivables $ 292,410 1,753,877 4,598 2,050,885 4,199,916
Enterprise Funds
Governmental Funds
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
51
(6) Note Receivable - General Services Administration (GSA) on-behalf of National Oceanic and
Atmospheric Administration (NOAA)
In April 2016 a new lease was executed between the Kodiak Island Borough and GSA which included a debt
repayment portion designed to recoup costs incurred by the Borough to finance construction of the facility.
Monthly payments to the Borough are $14,112 including interest of 3.5%, continuing through March 2029.
As of June 30, 2017 the principal balance due is $1,629,536 and the principal amount due within one year is
$114,135. This note receivable is recorded in the Kodiak Fisheries Research Center Enterprise Fund.
(7) Deferred Inflows of Resources and Unearned Revenues
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
report unearned revenues in connection with resources that have been received, but not yet earned. At June
30, 2017, the various components of deferred inflows of resources and unearned revenue reported in the
governmental funds were as follows:
Unavailable Unearned Total
Unavailable taxes receivable $ 345,446 - 345,446
Unavailable land sales receivable 384,792 - 384,792
Grant advances prior to expending all proceeds - 30,930 30,930
Total unavailable/unearned revenue
for governmental funds $ 730,238 30,930 761,168
The remainder of this page left blank intentionally.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
52
(8) Capital Assets
As noted in Footnote (14), the Borough leases the Kodiak Island Hospital and Long Term Care Center to
Sisters of Providence. The value of the leased assets and associated depreciation are reflected in the Hospital
Facilities Fund and Long Term Care Center Fund following.
Capital asset activity for the year ended June 30, 2017 was as follows:
Beginning Ending
Balance Increase Decrease Balance
Governmental activities:
Capital assets, not being
depreciated
Land $ 23,444,818 525,400 (117,460) 23,852,758
Construction
work-in-progress 86,597,475 3,379,746 (3,110,163) 86,867,058
Total 110,042,293 3,905,146 (3,227,623) 110,719,816
Capital assets, being
depreciated:
Buildings and improvements 111,727,781 2,497,532 - 114,225,313
Improvements other than
buildings 21,972,451 155,667 - 22,128,118
Equipment 3,128,039 530,346 (368,926) 3,289,459
Infrastructure 5,762,722 - - 5,762,722
Total 142,590,993 3,183,545 (368,926) 145,405,612
Less accumulated
depreciation for:
Buildings and improvements 72,273,703 2,345,977 - 74,619,680
Improvements other than
buildings 9,641,146 1,192,403 - 10,833,549
Equipment 2,371,784 162,271 (215,207) 2,318,848
Infrastructure 5,117,379 75,922 - 5,193,301
Total 89,404,012 3,776,573 (215,207) 92,965,378
Total capital assets
being depreciated, net 53,186,981 (593,028) (153,719) 52,440,234
Total governmental
activities, net $ 163,229,274 3,312,118 (3,381,342) 163,160,050
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
53
Beginning Ending
Balance Increase Decrease Balance
Business-type activities:
Municipal Solid Waste Collection
and Disposal Fund capital assets,
not being depreciated
Land $ 1,651,248 - - 1,651,248
Construction work-in-progress 27,833,039 646,338 (31,200) 28,448,177
Total 29,484,287 646,338 (31,200) 30,099,425
Capital assets, being
depreciated:
Unclassified utility plant in
service 2,178,733 - - 2,178,733
Improvements other than
buildings 3,169,671 - - 3,169,671
Machinery and equipment 1,996,977 61,282 - 2,058,259
Total 7,345,381 61,282 - 7,406,663
Less accumulated
depreciation for:
Unclassified utility plant in
service 1,295,576 42,055 - 1,337,631
Improvements other than
buildings 1,745,489 176,062 - 1,921,551
Machinery and equipment 1,562,681 75,908 - 1,638,589
Total 4,603,746 294,025 - 4,897,771
Total capital assets
being depreciated, net 2,741,635 (232,743) - 2,508,892
Total Municipal Solid
Waste Collection and
Disposal Fund, net $ 32,225,922 413,595 (31,200) 32,608,317
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
54
Beginning Ending
Balance Increase Decrease Balance
Hospital Facilities Fund:
Capital assets, not being
depreciated
Artwork $ 16,091 - - 16,091
Land 10,251 - - 10,251
Total 26,342 - - 26,342
Capital assets, being
depreciated:
Buildings 48,668,270 - (15,567,986) 33,100,284
Improvements other than
buildings 401,046 - - 401,046
Machinery and equipment 3,627,068 - - 3,627,068
Total 52,696,384 - (15,567,986) 37,128,398
Less accumulated
depreciation for:
Buildings 17,613,850 1,073,506 (43,244) 18,644,112
Improvements other than
buildings 237,765 12,560 - 250,325
Machinery and equipment 3,556,209 35,645 - 3,591,854
Total 21,407,824 1,121,711 (43,244) 22,486,291
Total capital assets
being depreciated, net 31,288,560 (1,121,711) (15,524,742) 14,642,107
Total Hospital Facilities
Fund, net $ 31,314,902 (1,121,711) (15,524,742) 14,668,449
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
55
Beginning Ending
Balance Increase Decrease Balance
Long Term Care Center Fund:
Capital assets, being
depreciated:
Buildings $ - 15,567,986 - 15,567,986
Less accumulated
depreciation for:
Buildings - 562,177 - 562,177
Total capital assets
being depreciated, net - 15,005,809 - 15,005,809
Total Long Term Care
Fund, net $ - 15,005,809 - 15,005,809
Kodiak Fisheries Research Center Fund:
Capital assets, being
depreciated:
Buildings 17,840,410 - - 17,840,410
Improvements other than
buildings 2,385,500 - - 2,385,500
Machinery and equipment 1,187,678 - - 1,187,678
Total 21,413,588 - - 21,413,588
Less accumulated
depreciation for:
Buildings 10,107,804 594,680 - 10,702,484
Improvements other than
buildings 593,609 101,793 - 695,402
Machinery and equipment 1,179,643 6,028 - 1,185,671
Total 11,881,056 702,501 - 12,583,557
Total capital assets
being depreciated, net 9,532,532 (702,501) - 8,830,031
Total Kodiak Fisheries
Research Center Fund, net $ 9,532,532 (702,501) - 8,830,031
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
56
Beginning Ending
Balance Increase Decrease Balance
Total business-type activities:
Capital assets, not being
depreciated
Artwork $ 16,091 - - 16,091
Land 1,661,499 - - 1,661,499
Construction
work-in-progress 27,833,039 646,338 (31,200) 28,448,177
Total 29,510,629 646,338 (31,200) 30,125,767
Capital assets, being
depreciated:
Unclassified utility plant in
service 2,178,733 - - 2,178,733
Buildings 66,508,680 15,567,986 (15,567,986) 66,508,680
Improvements other than
buildings 5,956,217 - - 5,956,217
Machinery and equipment 6,811,723 61,282 - 6,873,005
Total 81,455,353 15,629,268 (15,567,986) 81,516,635
Less accumulated
depreciation for:
Unclassified utility plant in
service 1,295,576 42,055 - 1,337,631
Buildings 27,721,654 2,230,363 (43,244) 29,908,773
Improvements other than
buildings 2,576,863 290,415 - 2,867,278
Machinery and equipment 6,298,533 117,581 - 6,416,114
Total 37,892,626 2,680,414 (43,244) 40,529,796
Total capital assets
being depreciated, net 43,562,727 12,948,854 (15,524,742) 40,986,839
Total business-type
activities, net $ 73,073,356 13,595,192 (15,555,942) 71,112,606
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
57
During fiscal year 2017, the Borough created the Long Term Care Center Enterprise Fund to account for the
activities of the Long Term Care Center. The building in the amount of $15,567,986 and accumulated
depreciation of $43,244, as of June 30, 2016, were moved from the Hospital Facilities Fund to the Long
Term Care Center fund.
Depreciation expense was charged to the departments and functions of the primary government as follows:
Governmental activities:
General government $ 546,671
Public safety 176,905
Primary and secondary education 3,052,997
Total – governmental activities $ 3,776,573
Business-type activities:
Municipal solid waste collection and
disposal $ 294,025
Hospital facilities 1,121,711
Long Term Care Center 518,933
Kodiak fisheries research center 702,501
Total – business-type activities 2,637,170
Total primary government $ 6,413,743
(9) Interfund Receivables, Payables and Transfers
(a) Interfund Receivables and Payables
Interfund balances at June 30, 2017 consisted of the following:
Due to / from other funds:
Receivable Fund Payable Fund Amount
Major governmental funds:
General Fund Education and Health Debt Service Fund $ 192,938
General Fund Other Governmental Funds 802,600
Total primary government $ 995,538
All interfund balances were short term loans to cover negative cash balances at year end. The
outstanding short term balances between funds result from the time lag between the dates that (1) inter-
fund goods and services are provided or reimbursable expenditures or expenses occur, (2) transactions
are recorded in the accounting system, and (3) payments between funds are made.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
58
(b) Transfers
Interfund transfers have been made in accordance with budget ordinances. Funds are transferred from
one fund to support expenditures of other funds in accordance with the authority established for the
individual fund. Transfers between funds during the year ended June 30, 2017 were as follows:
Transfers In
Governmental Funds
Education Kodiak
and Health Hospital Long Term Fisheries
Debt Other Facilities Care Center Research Center
Service Governmental Enterprise Enterprise Fund Enterprise
Fund Funds Fund Funds Fund Total
Transfers Out
Major Governmental Funds:
General Fund $ 635,113 18,338 305,000 - - 958,451
Facilities Special Revenue Fund 151,858 286,455 - - - 438,313
Other Governmental Funds 272,409 393,863 784,372 - 45,000 1,495,644
Hospital Facilities Enterprise Fund - - - 8,062,822 - 8,062,822
Total transfers $ 1,059,380 698,656 1,089,372 8,062,822 45,000 10,955,230
A summary of significant transfers are as follows:
The General Fund transferred $635,113 to the Education and Health Debt Service Fund for
debt service on Borough bonds due to SOA reducing reimbursements by 25%.
The General Fund transferred $18,338 to the LEPC Special Revenue Fund to cover deficit
fund balance.
The General Fund transferred $305,000 to the Hospital Facilities Enterprise Fund to reimburse
withdrawals made in previous years.
The Facilities Special Revenue Fund transferred $151,858 to the Education and Health Debt
Service Fund for debt service on Borough bonds.
The Facilities Special Revenue Fund transferred $286,455 to the Renewal and Replacement
Projects Capital Project Fund to pay for capital improvements.
The School Bond Capital Projects Fund transferred $272,409 to the Education and Health
Debt Service Fund for debt service on Borough bonds.
The Building and Grounds Special Revenue Fund transferred $336,370 to the Renewal and
Replacement Projects Capital Projects Fund to pay for capital improvements.
The Other Capital Projects Capital Project Fund transferred $57,493 to the Fire Protection
Area #1 Special Revenue Fund to return unused project funds.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
59
The Land Sales Special Revenue Fund transferred $650,000 to the Hospital Facilities
Enterprise Fund to reimburse withdrawals made in previous years.
Fern Fuller Trust Special Revenue Fund transferred $134,372 to the Hospital Facilities
Enterprise Fund to pay for the purchase of new equipment.
The Tourism Development Special Revenue Fund transferred $45,000 to the Kodiak Fisheries
Research Center to support tourism activities.
Hospital Facilities Enterprise Fund transferred $4,529,157 to the Long Term Care Center
(LTCC) Enterprise Fund for the unspent bond proceeds that were defeased during fiscal year
2017. The Hospital Facilities Enterprise Fund also transferred $3,533,665 to the Long Term
Care Center which represented LTCC’s residual net position from prior year’s activity before
the LTCC fund was created.
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KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
60
(10) Long Term Debt
(a) General Obligation Bonds and other Debt
The Borough issues general obligation bonds and other debt to provide funds for the acquisition and
construction of major capital facilities. General obligation bonds are direct obligations and pledge the
full faith and credit of the Borough. General obligation bonds and other debt currently outstanding are
as follows:
Balance Balance Due Within
July 1, 2016 Additions Reductions June 30, 2017 One Year
General obligation bonds:
$8,000,000 2008 Series A
High School Improvement bonds,
due in semi-annual installments
of $350,000 to $595,000 plus
interest at 4.0% to 5.0% through
April 2028 5,620,000 - 5,620,000 - -
$8,000,000 2011 Series One
High School Renovation bonds,
due in semi-annual installments
of $330,000 to $595,000 plus
interest at 3.12% to 5.20% through
March 2031 6,530,000 - 320,000 6,210,000 330,000
$5,230,000 2012 Series A
Capital Improvements bonds
due in semi-annual installments
of $460,000 to $630,000 plus interest
at 2.0% to 5.0% through September 2024 4,760,000 - 455,000 4,305,000 460,000
$6,385,000 2012 Series B
Capital Improvements bonds
due in semi-annual installments of
$565,000 to $770,000 plus interest
at 2.0% to 5.0% through September 2024 5,810,000 - 550,000 5,260,000 565,000
$21,595,000 2013 Series One
High School Renovation bonds,
due in semi-annual installments of
$820,000 to $1,630,000 plus interest
of 3.8% to 5.0% through
February 2033 19,470,000 - 790,000 18,680,000 820,000
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
61
Balance Balance Due Within
July 1, 2016 Additions Reductions June 30, 2017 One Year
General obligation bonds, continued:
$22,660,000 2014 Series One
High School Renovation bonds,
due in semi-annual installments of
$840,000 to $1,690,000 plus
interest of 2.0% to 5.0% through
March 2034 21,135,000 - 810,000 20,325,000 840,000
$6,210,000 2015 Series Three
High School Renovation bonds,
due in semi-annual installments of
$200,000 to $480,000 plus interest
of 2.0% to 5.25% through
October 2035 6,210,000 - 195,000 6,015,000 200,000
$1,780,000 2015 Series Three
Renewal and Replacement bonds,
due in semi-annual installments of
$150,000 to $220,000 plus interest
of 2.0% to 5.0% through October 2025 1,780,000 - 145,000 1,635,000 150,000
$1,870,000 2016 Series One
High School Renovation bonds,
due in semi-annual installments of
$65,000 to $130,000 plus interest
of 2.0% to 5.0% through August 2035 1,870,000 - 30,000 1,840,000 65,000
$5,140,000 2016 Series One
Renewal and Replacement bonds,
due in semi-annual installments of
$440,000 to $660,000 plus interest
of 5.0% through August 2025 5,140,000 - 235,000 4,905,000 440,000
$4,905,000 2016 Series Three
High School Improvement Bonds,
due in annual installments of
$345,000 to $605,000 plus interest of
4.0% to 5.0% through December 2027 - 4,905,000 - 4,905,000 -
$ 78,325,000 4,905,000 9,150,000 74,080,000 3,870,000
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
62
The annual requirements to amortize all general obligation bonded debt outstanding as of June 30, 2017, are as
follows:
Principal Interest Total
Year ending June 30:
2018 $ 3,870,000 3,408,307 7,278,307
2019 4,425,000 3,245,932 7,670,932
2020 4,605,000 3,063,032 7,668,032
2021 4,800,000 2,873,382 7,673,382
2022 5,020,000 2,653,882 7,673,882
2023-2027 25,005,000 9,565,001 34,570,001
2028-2032 19,155,000 4,390,220 23,545,220
2033-2036 7,200,000 535,990 7,735,990
$ 74,080,000 29,735,746 103,815,746
At June 30, 2017, there was $234,996 available in the Education and Health Debt Service Fund to service general
obligation bonds. There are a number of limitations and restrictions contained in the various bond indentures.
The Borough is in compliance with all significant limitations and restrictions.
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KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
63
(b) Notes and Bonds Payable
As of June 30, 2017, the Borough had the following notes and bonds payable outstanding in the Municipal
Solid Waste Collection and Disposal Enterprise Fund:
Note payable (ACWF #505031) to Alaska Department of Environmental
Conservation (ADEC), to be paid within 20 years. From June 2, 1999
until April 28, 2005 interest accrued at 2.5%. From April 29, 2005 to
June 30, 2017 interest accrued at 1.5%. The first loan payment was
made on April 1, 2012, with payments of $100,000 due on April 1 in
each successive year.
$
1,400,000
Note payable (ACWF #505041) to Alaska Department of Environmental
Conservation (ADEC), to be paid within 20 years. Interest accrues at
1.5% over the life of the loan. The first loan payment is due one year
following substantial completion and initiation of operations of the
facility.
$
12,675,537
Note payable (ACWF #505061) to Alaska Department of Environmental
Conservation (ADEC), to be paid within 20 years. Interest started
being accrued at 1.5% in November 2015 and will be accrued over
the life of the loan. The first loan payment was made on March 1,
2016, with payments of varying amounts being due on March 1 in
each successive year.
$
2,362,079
On September 15, 2011, the Borough issued a $3,275,000 revenue bond,
with a premium of $384,379. The bond was marketed by the Alaska
Municipal Bond Bank. Interest accrues at rates between 3.0 and 5.0%
with payments due on September 1 and March 1 of each year. The
bond will mature on September 1, 2026.
$
2,702,109
As of June 30, 2017, the Borough had the following bond payable outstanding in the Long Term Care
Center Enterprise Fund:
On June 19, 2013, the Borough issued a $17,110,000 revenue bond,
with a premium of $1,707,320. The bond was marketed by the Alaska
Municipal Bond Bank. Interest accrues at rates between 2.0 and 5.0%
with payments due on June 1 and December 1 of each year. The bond
will mature on June 1, 2033. The unspent bond proceeds were
defeased in fiscal year 2017, see Footnote 18.
$
11,874,871
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
64
(c) Changes in Long-term Liabilities
Long-term liability activity for the year ended June 30, 2017, was as follows:
Balance Balance
June 30,June 30,Due within
2016 Additions Reductions 2017 one year
Governmental activities:
Bonds payable:
General obligation bonds $78,325,000 4,905,000 9,150,000 74,080,000 3,870,000
Bond premium 8,156,657 806,205 739,963 8,222,899 611,112
86,481,657 5,711,205 9,889,963 82,302,899 4,481,112
Compensated absences 237,757 242,398 237,757 242,398 242,398
Total $ 86,719,414 5,953,603 10,127,720 82,545,297 4,723,510
Business-type activities:
Municipal Solid Waste
Collection and Disposal:
Landfill closure and
post-closure costs $5,094,036 109,964 — 5,204,000 —
Notes and bonds payable 18,445,504 1,137,658 443,437 19,139,725 453,438
Total $ 23,539,540 1,247,622 443,437 24,343,725 453,438
Long Term Care Center:
Bonds payable $17,245,855 — 5,370,984 11,874,871 490,000
Business-type activities:
Landfill closure and post-
closure costs $5,094,036 109,964 — 5,204,000 —
Notes/bonds payable 35,691,359 1,137,658 5,814,421 31,014,596 943,438
Total $ 40,785,395 1,247,622 5,814,421 36,218,596 943,438
For governmental activities, compensated absences are generally liquidated by the General Fund.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
65
(11) Fund Balances
Detailed information related to amounts classified as nonspendable, committed and assigned fund balances in
governmental funds at June 30, 2017 are as follows:
Education School
and Renewal and
Facilities Health Replacement
Special Debt Facilities Bond Other
General Revenue Service Projects Capital Governmental
Fund Fund Fund Project Fund Funds Total
Nonspendable:
Prepaid Items $ 32,349 - - - 419,212 451,561
Committed:
Facility Upgrades - 39,297,999 - - - 39,297,999
Debt Service - - 234,996 - - 234,996
Fire and Road
Service Areas - - - - 2,250,164 2,250,164
Land Sales - - - - 1,460,669 1,460,669
Buildings and Grounds - - - - 473,768 473,768
Street Lighting
Districts - - - - 58,273 58,273
Tourism Development - - - - 204,914 204,914
Mission Lake Tide Gate - - - - 54,317 54,317
Total Committed $ - 39,297,999 234,996 - 4,502,105 44,035,100
Assigned:
Capital Projects and
Upgrades $ - - - 3,992,353 3,073,997 7,066,350
(12) Solid Waste Landfill Closure and Post Closure Care Costs
State and federal laws and regulations require that the Kodiak Island Borough place a final cover on its landfill
when closed and perform certain maintenance for a number of years after closure. In addition to operating
expenses related to current activities of the landfill, an expense provision and related liability are recognized
based on the future closure and post closure care costs that will be incurred based on the date the landfill no
longer accepts waste. The recognition of these landfill closure and post closure care costs is based on the amount
of the landfill used during the year. The estimated liability of landfill closure and post closure care costs is
$5,204,000 as of June 30, 2017, which is based on 36% usage (filled) of the landfill.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
66
The Borough recorded closure/post-closure expenses of $154,010 resulting from actual cost outlays of
$44,046 to close existing cells and estimated future costs of $109,964 for closure and post-closure costs. The
estimated total current cost of the landfill closure and post closure care of $5,204,000 is based on the amount
that would be paid if the landfill were closed as of June 30, 2017. However, the actual cost of closure and
post closure care may be higher due to inflation, changes in technology, or changes in landfill laws and
regulations.
The Borough is required by state and federal laws and regulations to make annual contributions to finance
closure and post closure care. The Kodiak Island Borough complies with these requirements by annually
recording the liability based on the estimates provided by the Kodiak Island Borough’s
Engineering/Facilities Director. It is anticipated that future inflation costs and additional costs that might
arise from changes in post closure requirements, due to changes in technology or more rigorous
environmental regulations, for example, will be financed primarily by charges to future landfill users and
secondarily by taxpayers.
In the fiscal year ended June 30, 1999, the Borough began initial planning for lateral expansion of the landfill
(Phase 3). In May of 2012 bidding on the project was begun and work is ongoing and expected to continue
through 2018. The lateral expansion has an estimated forty year capacity. Capital costs to complete is
estimated at $3,100,000.
(13) Insurance and Risk Retention
The Kodiak Island Borough is exposed to numerous risks of loss associated with the operations of a
government. These potential losses include, but are not limited to, employee relations and injuries, contracts,
theft, loss or damage of property and general liability. The Borough manages its risks from these potential
losses by participating in the Alaska Municipal League Joint Insurance Association, as well as purchasing
commercial insurance coverage. This insurance has provided the Borough with adequate coverage in the
past. There were no significant changes in insurance coverage obtained and there were no claims or
settlements that exceeded insurance coverage in any of the past three fiscal years.
The Borough is a member in good standing of the Alaska Municipal League Joint Insurance Association
(JIA), a governmental insurance pool established by the Alaska Municipal League. Claims are covered on
an occurrence basis. JIA provides risk management services, appraisal services and there is also a separate
pool for policy liability.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
67
The responsibilities of both JIA and the participants are as follows:
(a) Responsibilities of JIA
JIA shall perform the following instructions in discharging its responsibilities:
Provide insurance coverage as necessary for property, including building and contents,
automobile, mobile equipment and data processing equipment, casualty, including general
liability, public officials’ and employees’ liability, auto liability and employee benefit liability;
workers’ compensation, including employers’ liability; commercial blanket bond; and time
element.
Assist each participant’s assigned risk manager with the implementation of that function.
Provide loss prevention and safety and consulting services to participants as required.
Provide claims adjusting and subrogation services for claims covered by the association’s joint
insurance arrangement.
(b) Responsibilities of the Participants
The Participants shall have the following responsibilities:
The Borough Assembly or appointing official of each participant shall appoint a representative
as provided in Article 5, Section 2 of the bylaws and at least one alternate representative to
attend member meetings.
Each participant shall appoint an employee of the participant to be responsible for the risk
management function within that entity and to serve as a liaison between the participant and JIA
with respect to risk management.
Each participant shall maintain an active safety officer and/or committee, and shall comply with
all recommendations of JIA concerning the development and implementation of a loss control
policy to prevent unsafe practices.
Each participant shall maintain its own set of records as a loss log, in all categories of loss to
insure accuracy of JIA’s loss reporting system.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
68
(14) Rental Revenues
(a) Hospital Facilities Enterprise Fund
The Kodiak Island Borough Assembly leases the Kodiak Island Hospital premise and equipment to
Sisters of Providence d.b.a. Providence Kodiak Island Medical Center who assumed responsibility for
the hospital’s operations as of April 21, 1997. The lease agreement is effective for a term of twenty
years from that date. The lease is cancelable by either party with a one year notice. The hospital capital
assets, the lease income, and all other costs relating to the agreement are accounted for by the Borough
in the Hospital Facilities Enterprise Fund.
The agreement with Providence specifies that the Borough will contribute at least $108,000 per year
for the purchase of new and replacement equipment for the hospital. The Borough is also required to
fund any major maintenance and repairs projects exceeding $25,000 in cost. The Borough receives
$60,000 per month in rental revenue. In August 2003 the lease was amended and required Providence
to pay an additional lease payment of $1,300,000 in 2004. In October 2005 the lease was amended to
remove the requirement that Providence had to pay 50% of the net revenues of the hospital, up to
$600,000, in rental revenues. Providence now has to spend 50% or more of their net profit, up to
$200,000, on equipment. The lease was also amended to have the $108,000 of equipment which the
Borough was required to purchase annually to become Providence property rather than Borough
property.
(b) Long Term Care Center Enterpise Fund
The Kodiak Island Borough Assembly leases the Kodiak Island Long Term Care Center to Sisters of
Providence, d.b.a. Providence Kodiak Island Medical Center who assumed responsibility for the Long
Term Care Center’s operations as of February 1, 2015. The lease agreement is effective for a term of
twenty years from that date.
The lease is cancelable by either party with a one year notice. The Center’s capital assets, the lease
income, and all other costs relating to the agreement are accounted for by the Borough in the Long
Term Care Center Fund.
The agreement with Providence specifies that Providence will pay monthly lease payments to the
Borough in an amount no less than required to fully fund all debt service requirements plus an amount
sufficient to cover the Borough’s expenses in maintaining insurance for fire and other risks (including
earthquakes).
Over the term of the lease it is estimated that the average monthly lease payment will be $95,000.
(c) Kodiak Fisheries Research Center
The Kodiak Fisheries Research Center (KFRC) leases its premise to the Alaska Department of Fish
and Game (ADF&G), the General Services Administration (GSA) on behalf of National Oceanic and
Atmospheric Administration (NOAA), and the University of Alaska Fairbanks (UAF).
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
69
The lease with ADF&G is from October 1, 1998 through September 30, 2018, with an option to extend
for up to two additional five year periods. Annual rent is $57,680. The annual rent from 2012 through
2018 will be adjusted for the tenant’s proportionate share of building expenses and utilization of the
seawater system.
The lease with NOAA was amended in April 2016 and expires in March 2036. Annual rent is $868,777
which is comprised of $185,867 base rent plus operational and maintenance expenses of $513,561 and
debt repayment of $169,349. The debt repayment element was negotiated in the new lease to recover
a portion of the original debt incurred by the Borough for construction of the facility. The original
bond issue was fully paid by the Borough; however, the new lease is designed to recoup costs already
incurred and this portion of the lease is recorded as a long-term receivable in the amount of $1,629,536
as of June 30, 2017.
The lease with UAF was originally from October 1, 1998 through September 30, 2018, cancelable
with 30 days’ notice, with an option to extend for up to two additional five year periods. The State of
Alaska cancelled the lease for laboratory space effective September 1, 2012, but has continued leasing
the dorm space. The State has not given notice to cancel this section of the lease. In 2016 UAF paid
$66,054 to lease dorm space at the research facility.
The lease with the Kodiak Island School District was from March 2015 through June 30, 2018 with an
option to extend for one additional two year period. In November 2016, the School District exercised
the option to terminate the lease early. The final rent payment was made in February 2017.
The lease with Kodiak Regional Aquaculture Association was amended to include more space. The
new lease term is from March 2017 through March 2020. Annual rent is $18,924.
(15) Employee Retirement System Plans
The Borough follows Governmental Accounting Standards Board (GASB) Codification P20, Accounting for
Pensions by State and Local Governmental Employees and GASB Codification P50, Accounting and Financial
Reporting by Employers for Post-employment Benefits Other than Pensions. GASB Codification P20 and
GASB Codification P50 establish uniform standards for the measurement, recognition and display of pension
and other post-employment benefits other than pensions (healthcare) expenditures/expense and related
liabilities, assets, note disclosure and applicable required supplementary information in the financial reports of
state and local governmental employers.
All full-time employees and certain permanent part-time employees of the Borough participate in the State of
Alaska Public Employees’ Retirement System (PERS). In addition to the pension plan the system also
administers other post-employment benefit plans.
The system is governed by the Alaska Retirement Management Board. The benefit and contribution provisions
are established by State law and may be amended only by the State legislature. The Administrator of the Plan
is the Commissioner of Administration or the Commissioner’s designee.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
70
Summary of Significant Accounting Policies. The financial statements for PERS are prepared using the accrual
basis of accounting. Plan member contributions are recognized in the period in which the contributions are
due. The Borough’s contributions are recognized when due and a formal commitment to provide the
contributions has been made. Benefits and refunds are recognized when due and payable in accordance with
the terms of the plan. All plan investments are reported at fair value.
PERS acts as the common investment and administrative agency for the following multiple-employer plans:
Plan Name Type of Plan
Defined Benefit Pension Plan (DB) Cost-sharing, Defined Benefit Pension
Defined Contribution Pension Plan (DC) Defined Contribution Pension
Defined Benefit Other Postemployment Benefits (DB)
Occupational Death and Disability Plan Cost-sharing, Defined Benefits OPEB
Alaska Retiree Healthcare Trust Plan Cost-sharing, Defined Benefits OPEB
Retiree Medical Plan Cost-sharing, Defined Benefits OPEB
Defined Contribution Other Postemployment
Benefits (DC)
Healthcare Reimbursement Arrangement Plan Defined Contribution OPEB
Other Postemployment Benefit Plans (OPBP)
Occupational Death and Disability Plan (DB)
The Occupational Death and Disability Plan provides death benefits for beneficiaries of plan participants and
long-term disability benefits to all active members within the System.
Alaska Retiree Healthcare Trust Plan (DB)
Beginning July 1, 2007, the Alaska Retiree Healthcare Trust Plan (ARHCT), a Healthcare Trust Fund of the
State, was established. The ARHCT is self-funded and provides major medical coverage to retirees of the
System. The System retains the risk of loss of allowable claims for eligible members. The ARHCT began
paying member healthcare claims on March 1, 2008. Prior to that, healthcare claims were paid for by the
Retiree Health Fund (RHF).
Healthcare Reimbursement Arrangement Plan (DC)
The Healthcare Reimbursement Arrangement Plan was established to allow medical expenses to be reimbursed
from individual savings accounts established for eligible participants.
Alaska Public Employee Retirement System (PERS) – Defined Benefit Plan (DB)
Plan Description. The Borough participates in the Alaska Public Employees’ Retirement System (PERS), a
cost sharing multiple employer defined benefit pension plan. PERS provides retirement benefits, disability
and death benefits, and post-employment healthcare to plan members and beneficiaries. The Plan was
established and is administered by the State of Alaska, Department of Administration. The Public Employee’s
Retirement System issues a publicly available financial report that includes financial statements and required
supplementary information for PERS. This report may be obtained from the system at Pouch C, Juneau, Alaska
99811 or online at http://doa.alaska.gov/drb/pers.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
71
Pension Benefits. All tier employee benefits vest with five years of credited service. There are three tiers of
employees based on entry date. Tier I employees enrolled prior to July 1, 1986 with five or more years of
credited service are entitled to annual pension benefits beginning at normal retirement age 55 or early
retirement age 50. For tier II and III employees enrolled after June 30, 1986, but before July 1, 2006, the
normal and early retirement ages are 60 and 55, respectively. All tier employees with 30 or more years of
credited service may retire at any age and receive a normal benefit.
The PERS defined benefit is closed to new hires enrolled on or after July 1, 2006. New hires after this date
participate in the PERS defined contribution plan (DC) described later in these notes.
Currently there are 155 employers participating in PERS, including the State of Alaska and 154 political
subdivisions and public organizations.
Retirement benefits are calculated by multiplying the average monthly compensation (AMC) times credited
PERS service times the percentage multiplier. The AMC is determined by averaging the salaries earned during
the five highest (three highest for Police/Fire members or members hired prior to July 1, 1996) consecutive
payroll years. Members must earn at least 115 days of credit in the last year worked to include it in the AMC
calculation. The PERS pays a minimum benefit of $25 per month for each year of service when the calculated
benefit is less.
The percentage multipliers for police/fire personnel are 2% for the first ten years of service and 2.5% for all
service over 10 years. The percentage multipliers for all other participants are 2% for the first ten years, 2.25%
for the next ten years, and 2.5% for all remaining service earned on or after July 1, 1986. All service before
that date is calculated at 2%.
Post-employment healthcare benefits are provided without cost to all members first enrolled before July 1,
1986. Members first enrolled after June 30, 1986, but before July 1, 2006 and who have not reached age 60
may elect to pay for major medical benefits.
Post Retirement Pension Adjustments. Post retirement pension adjustments (PRPAs) are granted annually to
eligible benefit recipients when the consumer price index (CPI) increases during the preceding calendar year.
PRPAs are calculated by multiplying the recipient’s base benefit, including past PRPAs, times:
(a) 75% of the CPI increase in the preceding calendar year or 9%, whichever is less, if the recipient is at
least 65 or on PERS disability; or
(b) 50% of the CPI increase in the preceding calendar year or 6%, whichever is less, if the recipient is at
least 60, or has been receiving benefits for at least five years.
Ad hoc PRPAs, up to a maximum of 4%, may be granted to eligible recipients who first entered the PERS
before July 1, 1986, if the CPI increases and the financial condition of the fund will permit an increase. In a
year where an ad hoc PRPA is granted, eligible recipients will receive the higher of the two calculations.
Funding Policy. In April 2008 the Alaska Legislature passed legislation which statutorily capped the employer
contribution, established a state funded “on-behalf” contribution, and required that employer contributions be
calculated against all PERS eligible wages, including wages paid to participants of the PERS Tier IV defined
contribution plan (DC) described later in these footnotes. The state legislature capped the rate at 22%, with
the State contributing an on-behalf payment for the difference between the actuarial contribution and the cap.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
72
Salary Floor. During the 25th legislation session, Senate Bill 125 passed, which established a June 30, 2008
salary floor under AS 39.35.255(a)(2). The salary floor is the total base salaries paid by an employer to active
employees of the system as of the fiscal year ending June 30, 2008. The statute requires the Division of
Retirement and Benefits (Division) to collect employer contributions at a minimum based on FY 2008 base
salaries.
Termination Costs. If the Borough decides to terminate coverage for a department, group, or other
classification of members, even if that termination results from the decision to divest of a particular Borough
function, all affected employees in that department, group or other classification of members become
immediately vested in the plan. The Borough must pay to have a termination study completed. The purpose
of the study is to calculate the Borough’s one-time termination costs. The costs represent the amount necessary
to fully fund the costs of plan members who become vested through this process and for other changes in
actuarial assumptions, such as, earlier than expected retirement, that arise from the act of termination of
coverage. The Borough must pay a lump sum within 60 days of termination or arrange a payment plan that is
acceptable to the PERS Administrator. For fiscal year 2017 the past service rate is 16.02%.
Employee Contribution Rate. The Borough PERS active members are required to contribute 6.75% (4.59%
pension costs and 2.16% OPEB) and Borough employees are required to contribute 9.60% (6.53% pension and
3.07% OPEB) of their annual covered salary.
Employer and Other Contribution Rates. There are several contribution rates associated with the pension and
healthcare contributions and related liabilities. These amounts are calculated on an annual basis.
Employer Effective Rate: This is the actual employer pay-in rate. Under current legislation, this rate is
statutorily capped at 22% (14.96% pension costs and 7.04% OPEB) of eligible wages, subject to the salary
floor, and other termination costs as described above. This 22% rate is calculated on all PERS participating
wages, including those wages attributable to employees in the defined benefit plan.
ARM Board Adopted Rate: This is the rate formally adopted by the Alaska Retirement Management Board.
This rate is actuarially determined and used to calculate annual Plan funding requirements, without regard to
the statutory rate cap or the GASB accounting rate. This rate is 26.14% (17.78% pension and 8.36% OPEB).
Prior to July 1, 2015, there were no constraints or restrictions on the actuarial cost method or other assumptions
used in the ARM Board valuation. Effective July 1, 2015, the Legislature requires the ARM Board to adopt
employer contribution rates for past service liabilities using a level percent of pay method over a closed 25
year term which ends in 2039. This will result in lower ARM Board Rates in future years.
On-behalf Contribution Rate: This is the rate paid in by the State as an on-behalf payment as mandated under
current statute. Under state law, subject to annual appropriation, the state will contribute an on-behalf payment
into the plan in an amount equal to the difference between the ARM Board Rate and the Employer Effective
Rate. As a result, the On-behalf Contribution Rate for 2017 is 4.14% (2.82% pension and 1.32% OPEB). On-
behalf contribution amounts have been recognized in these financial statements as both revenue and
expenditures.
GASB Rate: This is the rate used to determine the long-term pension and healthcare liability for plan
accounting purposes. Certain actuarial methods and assumptions for this rate calculation are mandated by the
Governmental Accounting Standards Board (GASB). Medicare Part D subsidies are not reflected in this rate.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
73
The rate uses an 8% pension discount rate and a 4.30% healthcare discount rate. The current rate is 83.90%
(27.26% pension and 56.64% OPEB).
Employer contributions for the years ended June 30, 2017, 2016 and 2015 are as follows:
Pensions
(DB)
Other Post-Employment
Benefits (DB)
Total
2017 $ 276,484 130,114 406,598
2016 286,137 188,964 475,101
2015 297,177 224,247 521,424
The defined benefit unfunded liability (DBUL) presented under the defined contribution plan includes
employer contributions of $129,731 (pension) and $61,050 (OPEB).
For the year ended June 30, 2017 the State of Alaska contributed $151,520 (100% pension cost) on-behalf of
the Borough, which has been recorded in the fund financial statements under the modified-accrual basis of
accounting. In the government-wide financial statements the on-behalf contribution has been adjusted as of
the measurement date June 30, 2016 to a total of $126,631, to represent the pension expense attributable to the
State under the full accrual basis of accounting.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources
Related to Pensions: At June 30, 2017, the Borough reported a liability that reflected a reduction for State
pension support provided to the Borough. The amount recognized by the Borough as its proportionate share
of net pension liability, the related State support, and the total portion of the net pension liability that was
associated with the Borough were as follows:
Borough’s proportionate share of the net pension liability $ 7,434,494
State’s proportionate share of the net pension liability 939,394
Total $ 8,373,888
$5,913,141 of the net pension liability is reported in the governmental activities and $1,521,353 is reported in
the business-type activities.
The net pension liability was measured as of June 30, 2016, and the total pension liability used to calculate the
net pension liability was determined by an actuarial valuation as of that date. The Borough’s proportion of the
net pension liability was based on the present value of contributions for FY2018 through FY2039, as
determined by projections based on the June 30, 2016 valuation. At June 30, 2017, the Borough’s proportion
was 0.1330%, which is an increase of 0.0187% from June 30, 2016.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
74
Based on the measurement date of June 30, 2016, the Borough recognized pension expense of $1,850,670 for
the year ended June 30, 2017. At June 30, 2017, the Borough reported deferred outflows of resources and
deferred inflows of resources related to pensions from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual
experience $ 684 (82,869)
Changes of assumptions 34,290 -
Net difference between projected and actual
earnings on pension plan investments 730,775 -
Changes in proportion and differences between
Borough contributions and proportionate
share of contributions 459,046 -
Borough contributions subsequent to the
measurement date 406,215 -
Total $ 1,631,010 (82,869)
$406,215 reported as deferred outflows of resources related to pensions resulting from Borough contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year
ended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows of
resources related to pensions will be recognized in pension expense as follows:
Year Ended
June 30,
2018 $ 499,499
2019 150,775
2020 298,743
2021 192,909
Total $ 1,141,926
For the year ended June 30, 2017, the Borough recognized $721,862 of amortization of the net deferred
outflows and inflows of resources.
Actuarial Assumptions: The total pension liability in the June 30, 2016 (latest available) actuarial valuation
was determined by an actuarial valuation as of June 30, 2015, which was rolled forward to June 30, 2016.
Investment return / discount rate 8% per year (geometric), compounded annually, net
of expenses
Salary scale Inflation – 3.12% per year
Productivity – 0.50% per year
Payroll growth 3.62% per year (inflation + productivity)
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
75
Total inflation Total inflation as measured by the Consumer Price
Index for urban and clerical workers from
Anchorage is assumed to increase 3.12% annually.
Mortality (Pre-termination) Based upon 2010-2013 actual mortality experience.
60% of male rates and 65% of female rates of post
termination mortality rates. Deaths are assumed to
be occupational 70% of the time for peace officers,
and firefighters, 50% of the time for others.
Mortality (Post-termination) 96% of all rates of the RP-2000 combined mortality
table, 2000 base year projected to 2018.
Total turnover Based upon the 2010-2013 actual withdrawal
experience.
Disability Incidence rates based on 2010-2013 actual
experience. Post-disability mortality in accordance
with the RP-2000 Disabled Retiree Mortality Table.
Disabilities are assumed to be occupational 70% of
the time for peace officers / firefighters, 50% of the
time for others.
Retirement Retirement rates based upon the 2010-2013 actual
experience. Deferred vested members are assumed
to retire at their earliest unreduced retirement date
for others. For peace officers/firefighters, Tier 1
deferred vested members are assumed to retire at
age 55 and Tiers 2 and 3 deferred vested members
are assumed to retire at age 60.
Marriage and age difference Wives are assumed to be three years younger than
husbands. For others, 75% of male members and
70% of female members are assumed to be married.
For peace officers/firefighters, 85% of male
members and 60% female members are assumed to
be married.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
76
The long-term expected rate of return on pension plan investments was determined using the building-block
method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each major asset class. These ranges are combined
to produce the long-term expected rate of return by weighting the expected future real rates of return by the
target asset allocation percentage and adding expected inflation. The best estimates of arithmetic real rates of
return for each major asset class are summarized below:
Long-Term Expected
Asset Class Real Rate of Return
Domestic Equity 5.35%
Global Equity (non-U.S.) 5.55%
Private Equity 6.25%
Fixed Income 0.80%
Real Estate 3.65%
Alternative Equity 4.70%
Discount Rate: The discount rate used to measure the total pension liability was 8.00%. The projection of the
cash flows used to determine the discount rate assumed that Employer and State contributions will continue to
follow the current funding policy, which meets State statutes. Based on those assumptions, the pension plan’s
fiduciary net pension was projected 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 was applied to
all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate: The following presents the net pension
liability of the plan calculated using the discount rate of 8%, as well as what the Plans’ net pension liability
would be if it were calculated using a discount rate that is 1-percentage-point lower (7%) or 1-percentage-point
higher (9%) than the current rate:
1% Decrease Current Rate 1% Increase
(7%) (8%) (9%)
Net pension liability $ 9,575,251 7,434,494 5,628,863
Alaska Public Employee Retirement System (PERS) – Defined Contribution Plan (DC)
Plan Description and Funding Requirements. School Boroughs and Public Employers in the State of Alaska
have a defined contribution retirement plan (PERS Tier IV) for new hires first enrolled on or after July 1, 2006.
This Plan is administered by the State of Alaska, Department of Administration in conjunction with the defined
benefit plan noted above. The Administrator of the Plan is the Commissioner of Administration or the
Commissioner’s designee. Plan members make mandatory contributions of 8% of gross eligible compensation.
This amount goes directly to the individual’s account. State statutes require the employer to contribute 5% of
employees’ eligible compensation. Additionally, employers are required to contribute to OPEB (DB): 1.18%
for the retiree medical plan (DB), 0.17% for occupational and death and disability benefits (DB) and 3% of
employers’ average annual employee compensation to the health reimbursement arrangement (HRA DC). The
effective employer contribution is 22%. Plan members are 100% vested with their contributions.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
77
Members become vested in employers’ contributions as follows:
2 years of service – 25%
3 years of service – 50%
4 years of service – 75%
5 years of service – 100%
Plan provisions and contribution requirements and amendments are established by the Alaska Retirement
Management Board (ARMB). Total contributions for the year ended June 30, 2017 are as follows:
Employer Employee
Defined contribution (DC) $ 74,832 119,730
Other post-employment benefits (DB):
Retiree medical plan 17,660 -
Occupational death and disability benefits 2,371 -
Other post-employment benefits (DC) –
Health reimbursement agreement (HRA) 43,115 -
Defined benefit unfunded liability (DBUL) 190,781 -
$ 328,759 119,730
Actual contributions were equal to the annual required contributions. The Defined Benefit Unfunded Liability
(DBUL) is computed as the difference between the statutory employer contribution rate less employer
contributions for the defined contribution, major medical, occupational death and disability and the health
reimbursement arrangement. The DBUL calculation is allocated 68% pension and 32% OPEB.
Employer contributions for the years ended June 30, 2017, 2016 and 2015 are as follows:
Contributions / Other Post-Employment
Pensions Benefits Total
2017 $ 204,563 124,196 328,759
2016 153,129 119,184 272,313
2015 125,778 105,385 231,163
Deferred Compensation Plan
The Kodiak Island Borough has two deferred compensation plans created and amended in accordance with
Internal Revenue Code Section 457. The plans are available to all regular Borough employees. The deferred
compensation is not available to employees until termination, retirement, death, or unforeseeable emergency.
All amounts deferred under these plans are held in trusts that were established for the exclusive benefit of
plan participants. Amounts contributed to the plans by participants during the year ended June 30, 2017,
were $124,266.
The first plan is managed by the International City Managers Association Retirement Corporation. $64,870
was contributed to this plan during the year ended June 30, 2017. The Borough believes that the plan does
not meet the criteria for inclusion as a fiduciary fund.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
78
The second plan is managed by the MassMutual Financial Group. $59,396 was contributed to this plan
during the year ended June 30, 2017. The Borough believes that the plan does not meet the criteria for
inclusion as a fiduciary fund.
(16) Long Term Care Center Fund
During fiscal year 2017, Borough management separated the activities of the Long Term Care Center
(LTCC) Enterprise Fund from the Hospital Facilities Enterprise Fund upon completion of the Long Term
Care Center. The Hospital Facilities Enterprise Fund recorded a transfer out to the Long Term Care Center
Enterprise Fund in the amount of $8,062,822 as a result of the separation.
The Hospital Enterprise Fund also recorded a gain on the separation of $1,721,113, which is the net
difference between capital assets and associated debt that was transferred to the Long Term Care Center
Enterprise Fund. Conversely, the LTCC Enterprise Fund recognized a loss of $1,721,113.
(17) Contingencies
(a) General
The Borough, in the normal course of its activities, is involved in various claims and pending litigation.
After consultation with legal counsel, management estimates that these matters will be resolved without
material adverse effect on the Borough’s future financial position or results of operations.
(b) Grants
Amounts received or receivable from grantor agencies are subject to audit and adjustment by the grantor
agencies. Any disallowed claims, including amounts already collected, would become a liability of the
General or other applicable funds. In management’s opinion, disallowances, if any, will not be material.
(18) Advance Refunding of Debt
In November 2016, the Borough issued $4,905,000 of 2016 Series Three general obligation bonds with an
average interest rate of 4.82% to advance refund $5,620,000 of outstanding 2008 Series A bonds with an
average interest rate of 4.73%. The net proceeds of $5,661,892 (after payment of $49,313 in issuance costs)
plus $272,409 in unused proceeds from the 2008 Series A bonds were used to purchase U.S. government
securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future
debt service payments on the 2008 Series A bonds. As a result, the 2008 Series A bonds are considered to be
defeased and the liability for those bonds has been removed from the financial statements. As of June 30,
2017, the amount of defeased debt still outstanding was $5,250,000.
The Borough advance refunded the 2008 Series A bonds to reduce its total debt service payments over the next
11 years by $799,929 and to obtain an economic gain (difference of the present value of the debt service
payments on the old and new debt) of $481,938.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
79
In November 2016, the Borough’s Long Term Care Center Enterprise Fund advance refunded $4,455,000 of
the 2013 Series Two revenue bonds with an average interest rate of 4.43%, using $4,529,157 in available
resources and $363,612 released from the Debt Service Reserve Fund for the 2013 Series Two revenue bonds.
The $4,892,769 was used to purchase U.S. government securities. Those securities were deposited in an
irrevocable trust with an escrow agent to provide for all future debt service payments on the portion of the
2013 Series Two revenue bonds being advance refunded. As a result, this portion of the 2013 Series Two
revenue bonds are considered to be defeased and the liability for those bonds has been removed from the
financial statements. As of June 30, 2017, the amount of defeased debt still outstanding was $4,285,000.
Although the advance refunding resulted in the recognition of a loss of $54,590, the Long Term Care Center
Enterprise Fund in effect reduced its aggregate debt service payments by $1,544,114 over the next 16 years.
(19) Subsequent Events
Management have evaluated subsequent events through January 30, 2018, the date which the financial
statements were available for issue.
(20) Construction Commitments
The Borough has outstanding commitments for construction at year end of $1,733,096.
(21) Change in Accounting Principle
As discussed in Note 18, the Borough advance refunded a portion of the 2013 Series Two Revenue Bonds,
resulting in an in-substance defeasance of the refunded portion of the bonds. In 2017, the Borough adopted
the provisions of GASB Statement No. 86, Certain Debt Extinguishment Issues, which, among other
accounting and reporting criteria, requires the Borough to recognize a separately identified gain or loss in the
amount of any difference between the reacquisition price and the net carrying amount of the debt (together
with any deferred outflows or inflows from prior refundings) for debt refunded using only existing resources.
As a result of the implementation of this Statement, the Borough recognized a loss on refunding of $54,590.
(22) Reclassifications
During the current year, it was determined that the FY2016 calculation of net investment in capital assets had
incorrectly included the amounts of debt associated with the unspent portion of debt issuance proceeds in the
totals for capital-related debt. The following changes to previously reported amounts have been made:
Hospital Facilities Fund:
As originally
reported,
June 30, 2016 Changes As restated
Net investment in capital assets $ 14,069,047 4,529,157 18,598,204
Unrestricted net position 7,643,802 (4,529,157) 3,114,645
Total $ 21,712,849 - 21,712,849
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
80
Governmental Activities:
As originally
reported,
June 30, 2016 Changes As restated
Net investment in capital assets $ 76,747,617 1,725,878 78,473,495
Restricted for capital projects - 165,034 165,034
Unrestricted net position 51,380,334 (1,890,912) 49,489,422
Total $ 128,127,951 - 128,127,951
(23) Subsequent Accounting Pronouncements
The Governmental Accounting Standards Board has passed several new accounting standards with upcoming
implementation dates covering several topics as follows:
GASB 75 Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions. Effective for fiscal years beginning after June 15, 2017.
GASB 81 Irrevocable Split –Interest Agreements. Effective for fiscal years beginning after
December 15, 2016.
GASB 83 Certain Retirement Obligations. Effective for fiscal years beginning after June 15,
2018.
GASB 84 Fiduciary Activities. Effective for fiscal years beginning after December 15, 2018.
GASB 85 Omnibus 2017. Effective for fiscal years beginning after June 15, 2017.
GASB 86 Certain Debt Extinguishment Issues. Effective for fiscal years beginning after June 15,
2017.
GASB 87 Leases. Effective for fiscal years beginning after December 15, 2019.
Statements 81, 83, and 84 are not expected to have any significant impact on the financial statements of
the Borough.
GASB Statement No. 75, the primary objective of this statement is to improve accounting and financial
reporting by state and local governments for postemployment benefits other than pensions (other
postemployment benefits or OPEB). It also improves information provided by state and local
governmental employers about financial support for OPEB that is provided by other entities. This
Statement results from a comprehensive review of the effectiveness of existing standards of accounting
and financial reporting for all postemployment benefits (pensions and OPEB) with regard to providing
decision-useful information, supporting assessments of accountability and interperiod equity, and creating
additional transparency. In addition, this statement details the recognition and disclosure requirements for
employers with payables to defined benefit OPEB plans that are administered through trusts that meet the
specified criteria and for employers whose employees are provided with defined contribution OPEB. This
statement also addresses certain circumstances in which a nonemployer entity provides financial support
for OPEB of employees of another entity.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
81
GASB Statement No. 85, the objective of this statement is to address practice issues that have been
identified during implementation and application of certain GASB Statements. This statement addresses
a variety of topics including issues related to blending component units, goodwill, fair value measurement
and application, and postemployment benefits (pensions and other postemployment benefits [OPEB]).
GASB Statement No. 86, the primary objective of this Statement is to improve consistency in accounting
and financial reporting for in-substance defeasance of debt by providing guidance for transactions in which
cash and other monetary assets acquired with only existing resources—resources other than the proceeds
of refunding debt—are placed in an irrevocable trust for the sole purpose of extinguishing debt. This
Statement also improves accounting and financial reporting for prepaid insurance on debt that is
extinguished and notes to financial statements for debt that is defeased in substance. As discussed in Note
21, the Borough recognized a loss of $54,590 as a result of early adoption of GASB 86.
GASB Statement No. 87, the objective of this Statement is to better meet the information needs of financial
statement users by improving accounting and financial reporting for leases by governments. This
Statement increases the usefulness of governments' financial statements by requiring recognition of certain
lease assets and liabilities for leases that previously were classified as operating leases and recognize as
inflows of resources or outflows of resources based on the payment provisions of the contract. It
establishes a single model for lease accounting based on the foundational principle that leases are
financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a
lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease
receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of
information about governments' leasing activities.
REQUIRED SUPPLEMENTARY
INFORMATION
Budgetary Comparison Schedule
General Fund
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget –
Budget Positive 2016
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments:
Real $175,383 175,383 159,796 (15,587)20,174
Personal 21,467 21,467 21,508 41 11,865
Boat — — (64)(64)22,451
Aircraft 26,000 26,000 26,500 500 22,200
Penalty and interest 153,410 153,410 213,373 59,963 145,067
Total property taxes and assessments 376,260 376,260 421,113 44,853 221,757
Severance taxes:
Fish 1,663,000 1,663,000 1,182,924 (480,076)1,395,610
Mining 25,000 25,000 73,495 48,495 3,063
Logging 50,000 50,000 50,088 88 92,416
Total severance taxes 1,738,000 1,738,000 1,306,507 (431,493) 1,491,089
Intergovernmental:
State sources:
State revenue sharing 477,182 477,182 461,512 (15,670)692,624
Fisheries business tax 1,550,000 1,550,000 1,270,403 (279,597)1,382,320
Fisheries resource landing tax 50,000 50,000 60,422 10,422 20,370
Telephone and electric tax 20,000 20,000 16,481 (3,519)16,987
On-behalf PERS payment 369,125 369,125 107,145 (261,980)146,085
Liquor license — — — — 53
Total state sources 2,466,307 2,466,307 1,915,963 (550,344) 2,258,439
Federal sources:
Payments in lieu of taxes 1,332,000 1,332,000 1,592,112 260,112 1,670,540
Fish and Wildlife revenue sharing 150,080 150,080 230,082 80,002 203,084
Total federal sources 1,482,080 1,482,080 1,822,194 340,114 1,873,624
Total intergovernmental
revenue 3,948,387 3,948,387 3,738,157 (210,230)4,132,063
Charges for services -
Sale of copies and maps 4,000 4,000 904 (3,096)1,532
Licenses, permits and fees:
Building and trailer permits 40,000 40,000 57,928 17,928 38,177
Subdivision and zoning fees 17,500 17,500 16,785 (715)17,285
Other permits 8,500 8,500 8,833 333 10,689
Total licenses, permits and fees 66,000 66,000 83,546 17,546 66,151
Investment income 58,177 58,177 11,059 (47,118) 54,211
Other 10,500 10,500 2,811 (7,689) 35,941
Total revenues 6,201,324 6,201,324 5,564,097 (637,227) 6,002,744
(continued)
2017
KODIAK ISLAND BOROUGH
82
Budgetary Comparison Schedule
General Fund, continued
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget –
Budget Positive 2016
Original Final Actual (Negative)Actual
Expenditures:
General government:
General administration $208,614 208,614 177,983 30,631 175,699
Borough assembly 162,123 167,549 149,570 17,979 149,658
Borough manager 571,222 571,222 516,460 54,762 605,245
Borough clerk 552,058 552,058 519,422 32,636 556,743
Borough attorney 164,000 164,000 107,487 56,513 129,864
Finance department 947,761 947,761 719,954 227,807 943,633
Management information systems 915,880 915,880 810,500 105,380 930,200
Assessing department 781,226 781,226 743,480 37,746 677,938
Engineering/facilities department 176,695 176,695 319,031 (142,336)230,699
Total general government 4,479,579 4,485,005 4,063,887 421,118 4,399,679
Public safety - animal control 109,415 109,415 109,415 — 109,415
Community and economic development:
Community development department 957,070 957,070 860,160 96,910 777,637
Building official 165,263 165,263 96,979 68,284 161,221
Economic development 35,500 43,000 30,268 12,732 45,781
Total community and economic
development 1,157,833 1,165,333 987,407 177,926 984,639
Emergency preparedness 59,157 59,157 35,861 23,296 30,849
Health and social services 234,000 233,999 233,999 — 389,000
Education, culture, and recreation 24,200 24,200 17,562 6,638 23,949
Parks and recreation 41,140 41,140 30,172 10,968 87,456
Kodiak College and city libraries 96,000 96,000 96,000 — 195,000
Total expenditures 6,201,324 6,214,249 5,574,303 639,946 6,219,987
Excess (deficiency) of revenues
over (under) expenditures — (12,925)(10,206)2,719 (217,243)
Other financing sources (uses):
Insurance proceeds — — — — 403,958
Transfers out — (1,157,352)(958,451)198,901 (356,166)
Net other financing sources (uses)— (1,157,352)(958,451)198,901 47,792
Change in fund balance $— (1,170,277)(968,657)201,620 (169,451)
Fund balance, at beginning of year,
as previously stated 3,285,781 3,195,908
Prior period adjustment — 259,324
Fund balance, at beginning of year, as restated 3,285,781 3,455,232
Fund balance, at end of the year $ 2,317,124 3,285,781
See accompanying notes to required supplementary information.
2017
KODIAK ISLAND BOROUGH
83
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Special Revenue Fund – Education Support
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget –
Budget Positive 2016
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments:
Real $8,909,480 8,909,480 8,892,817 (16,663) 9,103,596
Personal 1,088,020 1,088,020 1,095,560 7,540 1,002,581
Intergovernmental - state sources -
Motor vehicle tax 280,000 280,000 235,177 (44,823) 253,112
Total revenues 10,277,500 10,277,500 10,223,554 (53,946) 10,359,289
Expenditures:
Primary and secondary education 10,277,500 10,277,500 10,277,548 (48) 10,905,650
Excess (deficiency) of revenues
over (under) expenditures — — (53,994) (53,994) (546,361)
Other financing sources:
Transfers in — — — — 485,600
Change in fund balance $— — (53,994) (53,994) (60,761)
Fund balance (deficit), at beginning of year (14,046) 46,715
Fund balance (deficit), at end of year $ (68,040) (14,046)
See accompanying notes to required supplementary information.
2017
84
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Special Revenue Fund – Facilities
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget –
Budget Positive 2016
Original Final Actual (Negative) Actual
Revenues -
Investment income $357,825 357,825 191,391 (166,434) 515,662
Expenditures 82,500 82,500 — 82,500 —
Excess of revenues over
expenditures 275,325 275,325 191,391 (83,934) 515,662
Other financing sources (uses) -
Transfers out (275,325) (427,183) (438,313) (11,130) (398,454)
Change in fund balance $— (151,858) (246,922) (95,064) 117,208
Fund balance, at beginning of year 39,544,921 39,427,713
Fund balance, at end of year $ 39,297,999 39,544,921
See accompanying notes to required supplementary information.
2017
85
KODIAK ISLAND BOROUGH
Notes to Required Supplementary Information – Budgetary Comparison Schedules
June 30, 2017
86
The Borough follows these procedures in establishing the budgetary data reflected in the fund financial statements:
The Borough Manager must submit to the Borough Assembly by April 30 a proposed operating budget for
the fiscal year commencing the following July 1. The operating budget includes proposed expenditures and
the means of financing them.
Public hearings are conducted by the Borough Assembly to obtain citizen comments.
By June 10, the budget is legally enacted through passage of an ordinance by Borough Assembly action. If
the Borough Assembly fails to pass an ordinance, the budget submitted by the Borough Manager becomes
the adopted budget.
Amendments to the budget can occur anytime during the fiscal year through the Borough Assembly or
administrative action. Generally, the following actions are required at the level of the particular change:
– All new appropriations are authorized by an appropriation ordinance that amends the annual budget
ordinance.
– A resolution of the Borough Assembly is required to move (appropriate) amounts between
departments and projects.
– The administration is authorized and directed by the Borough Assembly to effect the necessary line
item changes within the limits established by Items (1) and (2) above by project or department to
properly monitor, account, and report receipts and expenditures.
Expenditures may not legally exceed appropriations at the following levels: Capital Projects Funds – project
level, all other funds – department level.
All funds, except Capital Projects Funds, are budgeted on an annual basis encompassing a fiscal year.
Budgets of Capital Projects Funds generally encompass the period from start-up to project completion, which
is generally greater than one year.
Appropriations lapse at year end to the extent that they have not been expended for all funds, except Capital
Projects Funds, which lapse at project completion.
Budgets adopted by the Borough Assembly are in accordance with accounting principles generally accepted
in the United States of America.
The Borough published a separate 2017 budget document. That document may be obtained from the Kodiak
Island Borough, Finance Director, 710 Mill Bay Road, Kodiak, Alaska 99615.
Borough's
Proportionate
Share of the Plan Fiduciary
Borough's Borough's State of Alaska Net Pension Net Position as
Proportion Proportionate Proportionate Borough's Liability as a a Percentage
of the Net Share of the Share of the Total Covered Percentage of of the Total
Pension Net Pension Net Pension Net Pension Employee Employee Pension
Liability Liability Liability Liability Payroll Payroll Liability
0.0813% $ 3,790,363 $ 3,187,850 $ 6,978,213 $ 2,929,492 129% 62.37%
0.1143% $ 5,545,660 $ 1,488,931 $ 7,034,591 $ 3,204,521 173% 63.96%
0.1330% $ 7,434,494 $ 939,394 $ 8,373,888 $ 3,129,406 238% 59.55%
Notes to Schedule:
1.
2. Measurement is one year prior to fiscal year end for all years presented.
3.In fiscal year 2017 the Borough implemented GASB 82, which required a retroactive change in covered payroll.
4.
2015
2016
2017
Information presented for 2017 is based upon Plan measurement date June 30, 2016.
This schedule is intended to present 10 years of information. Additional years' information will be included as it becomes available.
KODIAK ISLAND BOROUGH
Public Employees' Retirement System (PERS)
Schedule of the Borough's Proportionate Share of the Net Pension Liability
June 30, 2017
Year
87
Contributions Contributions
Relative to the Borough's as a Percentage
Contractually Contractually Contribution Covered of Covered
Required Required Deficiency Employee Employee
Contribution Contribution (Excess) Payroll Payroll
$ 370,432 $ (370,432) $ - $ 3,204,521 11.56%
$ 377,365 $ (377,365) $ - $ 3,129,406 12.06%
$ 406,215 $ (406,215) $ - $ 3,055,486 13.29%
Notes to schedule
1. Valuation date:
2.
Methods and assumptions used to determine contribution rates:
3. Actuarial cost method: Entry Age Normal - level percentage of payroll.
4. Amortization method: Level dollar, closed.
5. Amortization period: 25 years, as a level of percentage of payroll.
6. Equivalent single amortization period: 17 years.
7. Asset valuation method:
8. Inflation:
9. Salary increases:
10. Investment rate of return:
11. Retirement age:
12. Mortality:
13.In fiscal year 2017 the Borough implemented GASB 82, which required a retroactive change in covered payroll.
14. This schedule is intended to present 10 years of information. Additional years' information will be included as it becomes available.
KODIAK ISLAND BOROUGH
Public Employees' Retirement System (PERS)
Schedule of the Borough's Contributions
June 30, 2017
Actuarially determined contribution rates are calculated as of June 30th, two years prior to the fiscal year in which
Year
2015
2016
2017
June 30, 2015, which was rolled forward to June 30, 2016.
8%, net of pension plan investment expenses. This is based on an average inflation rate of 3.12% and a
real rate of return of 4.88%.
An age-related assumption is used for participants not yet receiving payments.
Pre-termination mortality rates were based upon the 2010-2013. Actual mortality experience, 60% of
male and 65% of female post-termaination rates. Deaths are assumed to be occupational 70% of the time
for Peace Officers / Firefighters, 95% of all rates of the RP - 2000 Table Base Year provided to 2018
with projected scale BB.
contributions are reported.
3.12% per annum.
Ranges from 6.36% to 4.92% based on service for Peace Officer/Firefighter. Ranges from 8.35% to
4.34% based on age and service for All Others.
The actuarial asset value was reinitialized to equal fair value of assets as of June 30, 2014. Beginning in
FY2015, the assets value method recognizes 20% of the gain or loss each year, for a period of 5 years, all
assets are valued at fair value.
88
ADDITIONAL SUPPLEMENTARY INFORMATION
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Debt Service Fund - Education and Health
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
Variance with
Final Budget –
Positive 2016
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments $2,506,568 2,506,568 2,503,607 (2,961) 2,033,427
Intergovernmental:
State sources 5,328,029 3,641,882 3,840,763 198,881 4,304,877
Investment income (loss)2,000 2,000 (608) (2,608) (149)
Total revenues 7,836,597 6,150,450 6,343,762 193,312 6,338,155
Expenditures:
General government 11,263 11,260 11 11,249 9,125
Debt service:
Principal 4,114,978 3,530,000 3,530,000 — 3,201,002
Interest 3,710,356 3,568,562 3,568,559 3 3,194,612
Debt issuance — 26,500 64,313 (37,813) 124,372
Total expenditures 7,836,597 7,136,322 7,162,883 (26,561) 6,529,111
Excess (deficiency) of revenues
over (under) expenditures — (985,872) (819,121) 166,751 (190,956)
Other financing sources (uses):
Bond issuance — — 4,905,000 4,905,000 —
Premium on bonds issued — — 806,205 806,205 141,115
Payment to refunding escrow — — (5,934,301) (5,934,301) —
Transfers in — 985,872 1,059,380 73,508 150,000
Transfers out — — — — (69,553)
Net other financing sources (uses) — 985,872 836,284 (149,588) 221,562
Change in fund balance $— — 17,163 17,163 30,606
Fund balance, at beginning of year 217,833 187,227
Fund balance, at end of year $ 234,996 217,833
2017
Budget
89
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue
See Special Revenue section of this report.
Capital Projects
See Capital Projects section of this report.
NONMAJOR SPECIAL REVENUE FUNDS
The Fire Protection Area No. 1 Fund accounts for the activities related to fire suppression and fire prevention
services to the citizens of the service area.
The Womens Bay Fire Department Fund accounts for the activities related to fire suppression and fire prevention
services to the citizens of the service area.
The Kodiak Airport Fire District Fund accounts for the activities related to fire suppression and fire prevention
services to the citizens of the service area.
The Monashka Bay Road Service Area Fund accounts for the activities related to road services within the service
area.
The Service Area No. 1 Fund accounts for the activities related to maintenance service to roads within the district,
including snow removal, ditching and grading.
The Womens Bay Road Service Area Fund accounts for the activities related to maintenance service to roads
within the service area, including snow and ice removal, ditching and culvert work.
The Bay View Road Service Area Fund accounts for the activities related to road services within the service area.
The Service Area No. 2 Fund accounts for the activities related to water and sewer services in the service area.
This fund is in the design stage at present.
The Local Emergency Planning Committee (L.E.P.C.) Fund accounts for State of Alaska grants provided for
regional emergency preparation, response, and mitigation planning.
The Land Sales Fund accounts for the disposal of Borough-owned lands. The proceeds of land disposals are
generally used for the management of Borough lands and the repairs and maintenance of Borough school buildings.
The Buildings and Grounds Fund accounts for the operations and maintenance of certain buildings and grounds
owned by the Borough which are jointly shared with the City of Kodiak, the Kodiak Island Borough School
District, and certain nonprofit community organizations.
The Woodland Acres Street Light Service Area Fund accounts for activities related to the provision of street
lighting within the service area.
The Trinity Islands Street Light Service Area Fund accounts for activities related to the provision of street
lighting within the service area.
The Tourism Development Fund accounts for the collection of the Borough Transient Accommodation Tax (Bed
Tax) and its subsequent transfer to the Kodiak Island Convention and Visitor Bureau.
The Mission Lake Tide Gate Fund accounts for activities related to maintaining the tide gate for the residents of
the service area.
The Fern Fuller Trust Fund accounts for the distribution of funds to the beneficiaries of the trust.
KODIAK ISLAND BOROUGH
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2017
(With summarized financial information at June 30, 2016)
Special Capital
Revenue Project
Assets Funds Funds 2017 2016
Equity in central treasury $ 4,653,300 3,750,355 8,403,655 14,517,317
Receivables:
State of Alaska 8,368 1,063 9,431 83,637
Federal government — 49,923 49,923 651,839
Property taxes 31,450 — 31,450 26,274
Land sales contracts, due within one year 24,135 — 24,135 23,628
Other 56,117 23,367 79,484 33,484
Prepaid items 419,212 — 419,212 37
Land sale contracts, due after one year 360,657 — 360,657 181,191
Total assets $ 5,553,239 3,824,708 9,377,947 15,517,407
Liabilities:
Accounts payable $211,312 48,227 259,539 704,054
Customer deposits 27,450 — 27,450 27,450
Due to other funds 8,368 794,232 802,600 409,911
Unearned revenues — 30,930 30,930 30,930
Total liabilities 247,130 873,389 1,120,519 1,172,345
Deferred inflows of resources -
Unavailable revenues 384,792 — 384,792 204,819
Total liabilities and deferred
inflows of resources 631,922 873,389 1,505,311 1,377,164
Fund balances:
Nonspendable 419,212 — 419,212 181,191
Committed 4,502,105 — 4,502,105 3,318,926
Assigned — 3,073,997 3,073,997 10,658,464
Unassigned — (122,678) (122,678) (18,338)
Total fund balances 4,921,317 2,951,319 7,872,636 14,140,243
Total $ 5,553,239 3,824,708 9,377,947 15,517,407
Totals
Resources and Fund Balances
Liabilities, Deferred Inflows of
90
KODIAK ISLAND BOROUGH
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
Year ended June 30, 2017
(With summarized financial information for year ended June 30, 2016)
Special Capital
Revenue Project
Funds Funds 2017 2016
Revenues:
Property taxes and assessments $1,384,642 1,402,533 2,787,175 1,351,109
Transient accommodations tax 108,050 — 108,050 95,466
Intergovernmental:
State sources 55,788 36,647 92,435 2,054,374
Federal sources 7,497 798,846 806,343 1,216,909
Charges for services 790,882 — 790,882 696,492
Licenses, permits and fees 2,125,324 — 2,125,324 1,250
Investment income 25,941 17,076 43,017 73,915
Rental 14,160 — 14,160 8,800
Other 6,335 — 6,335 9,481
Total revenues 4,518,619 2,255,102 6,773,721 5,507,796
Expenditures:
Current:
General government 1,100,518 117,583 1,218,101 774,915
Public safety 589,703 — 589,703 463,424
Community and economic development 109,521 — 109,521 85,000
Service district maintenance 475,248 — 475,248 626,289
Capital outlay:
Schools — 227,474 227,474 428,246
General — 1,086,817 1,086,817 3,319,610
Total expenditures 2,274,990 1,431,874 3,706,864 5,697,484
Excess (deficiency) of revenues
over (under) expenditures 2,243,629 823,228 3,066,857 (189,688)
Other financing sources (uses):
Land sales proceeds 145,820 — 145,820 110,428
Proceeds from sale of capital assets 140,000 — 140,000 —
Bond issuance — — — 7,010,000
Premium on bonds issued — — — 990,000
Transfers in 75,831 622,825 698,656 678,443
Transfers out (1,165,742) (329,902) (1,495,644) (578,160)
Net other financing sources (uses) (804,091) 292,923 (511,168) 8,210,711
Change in fund balances 1,439,538 1,116,151 2,555,689 8,021,023
Fund balances, at beginning of year 3,481,779 1,835,168 5,316,947 6,119,220
Fund balances, at end of year $ 4,921,317 2,951,319 7,872,636 14,140,243
Totals
91
Fire
Fire Womens Kodiak Monashka Womens
Protection Bay Fire Airport Fire Bay Road Service Bay Road Bay View Road Service Area
Area No. 1 Department District Service Area Area No. 1 Service Area Service Area No. 2 L.E.P.C.
Equity in central treasury $ 693,991 602,405 37,399 132,664 677,541 104,558 23,069 5,893 —
Receivables:
State of Alaska — — — — — — — — 8,368
Property taxes 11,911 2,941 653 864 8,917 5,883 281 — —
Land sales contracts, due within one year — — — — — — — — —
Other 15 — — — — — — — —
Prepaid items 419,212 — — — — — — — —
Land sale contracts, due after one year — — — — — — — — —
Total $ 1,125,129 605,346 38,052 133,528 686,458 110,441 23,350 5,893 8,368
Liabilities:
Accounts payable 12,846 3,802 — — 39,500 1,223 — — —
Customer deposits — 1,450 — — — — — — —
Due to other funds — — — — — — — — 8,368
Total liabilities 12,846 5,252 — — 39,500 1,223 — — 8,368
Deferred inflows of resources:
Unavailable revenues — — — — — — — — —
Total liabilities and deferred
inflows of resources 12,846 5,252 — — 39,500 1,223 — — 8,368
Fund balances:
Nonspendable 419,212 — — — — — — — —
Committed 693,071 600,094 38,052 133,528 646,958 109,218 23,350 5,893 —
Unassigned — — — — — — — — —
Total fund balances 1,112,283 600,094 38,052 133,528 646,958 109,218 23,350 5,893 —
Total $ 1,125,129 605,346 38,052 133,528 686,458 110,441 23,350 5,893 8,368
(continued)
KODIAK ISLAND BOROUGH
Combining Balance Sheet
Nonmajor Special Revenue Funds
(With summarized financial information at June 30, 2016)
June 30, 2017
Liabilities, Deferred Inflows of Resources,
and Fund Balances
State Grant
Program
Assets
Fire and Road Service Areas
Road
92
Woodland
Buildings Acres Street Trinity Islands
and Light Service Street Light Tourism Mission Lake Totals
Assets Land Sales Grounds Area Service Area Development Tide Gate 2017 2016
Equity in central treasury $ 1,576,291 510,399 30,895 27,928 175,950 54,317 4,653,300 3,626,787
Receivables:
State of Alaska — — — — — — 8,368 10,199
Property taxes — — — — — — 31,450 26,274
Land sales contracts, due within one year 24,135 — — — — — 24,135 23,628
Other 27,138 — — — 28,964 — 56,117 30,331
Prepaid items — — — — — — 419,212 37
Land sale contracts, due after one year 360,657 — — — — — 360,657 181,191
Total $ 1,988,221 510,399 30,895 27,928 204,914 54,317 5,553,239 3,898,447
Liabilities:
Accounts payable 116,760 36,631 401 149 — — 211,312 155,862
Customer deposits 26,000 — — — — — 27,450 27,450
Due to other funds — — — — — — 8,368 28,537
Total liabilities 142,760 36,631 401 149 — — 247,130 211,849
Deferred inflows of resources:
Unavailable revenues 384,792 — — — — — 384,792 204,819
Total liabilities and deferred
inflows of resources 527,552 36,631 401 149 — — 631,922 416,668
Fund balances:
Nonspendable — — — — — — 419,212 181,191
Committed 1,460,669 473,768 30,494 27,779 204,914 54,317 4,502,105 3,318,926
Unassigned — — — — — — — (18,338)
Total fund balances 1,460,669 473,768 30,494 27,779 204,914 54,317 4,921,317 3,481,779
Total $ 1,988,221 510,399 30,895 27,928 204,914 54,317 5,553,239 3,898,447
June 30, 2017
(With summarized financial information at June 30, 2016)
Street Lighting Districts
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Combining Balance Sheet, (continued)
Liabilities, Deferred Inflows of Resources,
and Fund Balances
93
State Grant
Fire Program
Fire Womens Kodiak Monashka Womens
Protection Bay Fire Airport Fire Bay Road Service Bay Road Bay View Road Service
Area No. 1 Department District Service Area Area No. 1 Service Area Service Area Area No. 2 L.E.P.C.
Revenues:
Property taxes and assessments $ 588,587 101,077 15,366 62,162 394,545 194,901 14,256 — —
Transient accommodations tax — — — — — — — — —
Intergovernmental -
State sources 4,620 — — — — — — — 13,756
Federal sources 7,497 — — — — — — — —
Charges for services — 14,716 — — — — — — —
Licenses, permits and fees — — — — — 27,600 — — —
Investment income 4,393 2,853 211 650 3,218 811 110 29 —
Rental — 14,160 — — — — — — —
Other 4,425 350 — — — — — — —
Total revenues 609,522 133,156 15,577 62,812 397,763 223,312 14,366 29 13,756
Expenditures:
Current:
General government — — — — — — — — —
Public safety 493,434 67,776 14,737 — — — — — 13,756
Community and economic
development — — — — — — — — —
Service district maintenance — — — 20,069 159,877 289,488 5,346 — —
Total expenditures 493,434 67,776 14,737 20,069 159,877 289,488 5,346 — 13,756
Excess (deficiency) of revenues
over (under) expenditures 116,088 65,380 840 42,743 237,886 (66,176) 9,020 29 —
Other financing sources (uses):
Land sale proceeds — — — — — — — — —
Proceeds from sale of capital assets 140,000 — — — — — — — —
Transfers in 57,493 — — — — — — — 18,338
Transfers out — — — — — — — — —
Net other financing sources (uses) 197,493 — — — — — — — 18,338
Change in fund balances 313,581 65,380 840 42,743 237,886 (66,176) 9,020 29 18,338
Fund balances (deficit), at beginning of year 798,702 534,714 37,212 90,785 409,072 175,394 14,330 5,864 (18,338)
Fund balances, at end of year $1,112,283 600,094 38,052 133,528 646,958 109,218 23,350 5,893 —
(continued)
Fire and Road Service Areas
Road
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances (Deficit)
Year ended June 30, 2017
(With summarized financial information for the year ended June 30, 2016)
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
94
Woodland Acres Trinity Islands
Buildings and Street Light Street Light Tourism Mission Lake Fern Fuller Totals
Land Sales Grounds Service Area Service Area Development Tide Gate Trust 2017 2016
Revenues:
Property taxes and assessments $ — — 5,155 2,446 — 6,147 — 1,384,642 1,351,109
Transient accommodations tax — — — — 108,050 — — 108,050 95,466
Intergovernmental - —
State sources 3,780 2,745 — — 30,887 — — 55,788 55,013
Federal sources — — — — — — — 7,497 —
Charges for services 24,488 751,678 — — — — — 790,882 696,492
Licenses, permits and fees 2,097,724 — — — — — — 2,125,324 1,250
Investment income 8,173 3,632 153 136 948 259 365 25,941 26,197
Rental — — — — — — — 14,160 8,800
Other 1,441 119 — — — — — 6,335 9,172
Total revenues 2,135,606 758,174 5,308 2,582 139,885 6,406 365 4,518,619 2,243,499
Expenditures:
Current:
General government 552,657 541,251 4,817 1,793 — — — 1,100,518 774,915
Public safety — — — — — — — 589,703 463,424
Community and economic
development — — — — 109,521 — — 109,521 85,000
Service district maintenance — — — — — 468 — 475,248 626,289
Total expenditures 552,657 541,251 4,817 1,793 109,521 468 — 2,274,990 1,949,628
Excess (deficiency) of revenues
over (under) expenditures 1,582,949 216,923 491 789 30,364 5,938 365 2,243,629 293,871
Other financing sources (uses):
Land sales proceeds 145,820 — — — — — — 145,820 110,428
Proceeds from sale of capital assets — — — — — — — 140,000 —
Transfers in — — — — — — — 75,831 76,918
Transfers out (650,000) (336,370) — — (45,000) — (134,372) (1,165,742) (198,580)
Net other financing sources (uses) (504,180) (336,370) — — (45,000) — (134,372) (804,091) (11,234)
Change in fund balances 1,078,769 (119,447) 491 789 (14,636) 5,938 (134,007) 1,439,538 282,637
Fund balances (deficit), at beginning of year 381,900 593,215 30,003 26,990 219,550 48,379 134,007 3,481,779 3,199,142
Fund balances, at end of year $1,460,669 473,768 30,494 27,779 204,914 54,317 — 4,921,317 3,481,779
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Street Lighting Districts
Combining Statement of Revenues, Expenditures,
Year ended June 30, 2017
and Changes in Fund Balances (Deficit), (continued)
(With summarized financial information for the year ended June 30, 2016)
95
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Fire Protection Area No. 1
Schedule of Revenues, Expenditures,
and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 582,500 588,587 6,087 572,733
Intergovernmental:
State sources - PERS on behalf payment — 4,620 4,620 2,705
Federal sources - passed through the State of Alaska — 7,497 7,497
Investment income — 4,393 4,393 5,601
Other 1,500 4,425 2,925 2,831
Total revenues 584,000 609,522 25,522 583,870
Expenditures:
Public safety:
Personnel 100,309 112,159 (11,850) 61,161
Volunteers 40,000 29,130 10,870 29,925
Fringe benefits 80,318 79,197 1,121 48,625
Professional services 2,000 24,658 (22,658) 1,821
Support goods and services 229,500 240,131 (10,631) 214,581
Capital outlay 582,000 8,159 573,841 4,380
Total expenditures 1,034,127 493,434 540,693 360,493
Excess (deficiency) of revenues
over (under) expenditures (450,127) 116,088 566,215 223,377
Other financing sources:
Proceeds from sale of capital assets — 140,000 140,000 —
Transfers in — 57,493 57,493 —
Net other financing sources — 197,493 197,493 —
Change in fund balance $(450,127) 313,581 763,708 223,377
Fund balance, at beginning of year 798,702 575,325
Fund balance, at end of year $ 1,112,283 798,702
2017
96
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Womens Bay Fire Department
Schedule of Revenues, Expenditures,
and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 99,000 101,077 2,077 99,338
Charges for services 14,000 14,716 716 16,610
Investment income 1,000 2,853 1,853 4,095
Rental 12,000 14,160 2,160 8,800
Other — 350 350 5,780
Total revenues 126,000 133,156 7,156 134,623
Expenditures:
Public safety:
Personnel services 7,000 1,040 5,960 785
Fringe benefits 3,000 724 2,276 480
Professional services — 4,489 (4,489) 5,460
Support goods and services 159,150 61,523 97,627 67,016
Capital outlay 106,850 — 106,850 —
Total expenditures 276,000 67,776 208,224 73,741
Excess (deficiency) of revenues
over (under) expenditures (150,000) 65,380 215,380 60,882
Other financing uses -
Transfers out -
State Capital Grants Capital Project Fund — — — (100,000)
Change in fund balance $(150,000) 65,380 215,380 (39,118)
Fund balance, at beginning of year 534,714 573,832
Fund balance, at end of year $ 600,094 534,714
2017
97
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Kodiak Airport Fire District
Schedule of Revenues, Expenditures,
and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 14,500 15,366 866 14,716
Investment income 500 211 (289) 233
Total revenues 15,000 15,577 577 14,949
Expenditures:
Public safety:
Support goods and services 45,000 14,737 30,263 14,330
Excess of revenues over
expenditures $(30,000) 840 30,840 619
Fund balance, at beginning of year 37,212 36,593
Fund balance, at end of year $ 38,052 37,212
98
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Monashka Bay Road Service Area
Schedule of Revenues, Expenditures,
and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 60,000 62,162 2,162 59,665
Investment income — 650 650 576
Total revenues 60,000 62,812 2,812 60,241
Expenditures:
Service district maintenance:
Personnel services 500 315 185 185
Fringe benefits — 204 (204) 163
Support goods and services 2,350 81 2,269 127
Snow removal/sanding 28,150 11,126 17,024 —
Road grading/ditching 13,000 1,414 11,586 7,644
Repairs and maintenance 16,000 6,929 9,071 18,294
Total expenditures 60,000 20,069 39,931 26,413
Excess of revenues over
expenditures $— 42,743 42,743 33,828
Fund balance, at beginning of year 90,785 56,957
Fund balance, at end of year $ 133,528 90,785
99
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Service Area No. 1
Schedule of Revenues, Expenditures,
and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 388,000 394,545 6,545 386,095
Investment income — 3,218 3,218 3,448
Total revenues 388,000 397,763 9,763 389,543
Expenditures:
Service district maintenance:
Personnel services 8,800 6,038 2,762 6,868
Fringe benefits 2,900 1,415 1,485 1,848
Support goods and services 2,600 685 1,915 1,244
Snow removal/sanding 200,000 62,934 137,066 10,114
Road grading/ditching 60,000 32,493 27,507 65,240
Repairs and maintenance 213,700 56,312 157,388 296,876
Total expenditures 488,000 159,877 328,123 382,190
Excess (deficiency) of revenues
over (under) expenditures (100,000) 237,886 337,886 7,353
Other financing uses:
Transfers out -
Trinity Islands Paving Special Revenue Fund — — — (4,480)
Change in fund balance $(100,000) 237,886 337,886 2,873
Fund balance, at beginning of year 409,072 406,199
Fund balance, at end of year $ 646,958 409,072
(With financial information for the year ended June 30, 2016)
100
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Womens Bay Road Service Area
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $190,000 194,901 4,901 191,715
Licenses, permits and fees 27,000 27,600 600 —
Investment income — 811 811 1,226
Total revenues 217,000 223,312 6,312 192,941
Expenditures:
Service district maintenance:
Personnel services 1,000 81 919 361
Fringe benefits — 24 (24) 275
Support goods and services 76,000 287 75,713 435
Snow removal/sanding 60,000 73,174 (13,174) 17,187
Road grading/ditching 40,000 51,915 (11,915) 39,067
Repairs and maintenance 90,000 164,007 (74,007) 150,971
Total expenditures 267,000 289,488 (22,488) 208,296
Excess (deficiency) of revenues
over (under) expenditures (50,000) (66,176) (16,176) (15,355)
Other financing sources:
Transfers in -
Land Sales Special Revenue Fund — — — 27,600
Change in fund balance $ (50,000) (66,176) (16,176) 12,245
Fund balance, at beginning of year 175,394 163,149
Fund balance, at end of year $ 109,218 175,394
101
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Bay View Road Service Area
Schedule of Revenues, Expenditures, and Changes in Fund
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $15,257 14,256 (1,001) 13,605
Investment income — 110 110 91
Total revenues 15,257 14,366 (891) 13,696
Expenditures:
Service district maintenance:
Personnel services — 246 (246) 59
Fringe benefits — 151 (151) 63
Professional services 7,257 — 7,257 —
Support goods and services — 20 (20) 382
Snow removal/sanding 5,400 3,891 1,509 835
Road grading/ditching 1,100 497 603 4,203
Repairs and maintenance 1,500 541 959 2,625
Total expenditures 15,257 5,346 9,911 8,167
Excess of revenues over
expenditures $— 9,020 9,020 5,529
Fund balance, at beginning of year 14,330 8,801
Fund balance, at end of year $ 23,350 14,330
102
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fire and Road Service Areas – Service Area No. 2
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Investment income $100 29 (71) 41
Expenditures:
Service district maintenance:
Support services 100 — 100 —
Excess of revenues over
expenditures $— 29 29 41
Fund balance, at beginning of year 5,864 5,823
Fund balance, at end of year $ 5,893 5,864
103
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
L.E.P.C.
Schedule of Revenues, Expenditures, and Changes in Fund (Deficit)
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources – grants $14,000 13,756 (244) 14,343
Expenditures:
Public safety:
Personnel services 10,000 7,299 2,701 6,812
Fringe benefits — 4,795 (4,795) 4,551
Support goods and services 22,338 1,662 20,676 3,497
Total expenditures 32,338 13,756 18,582 14,860
Excess (deficiency) of revenues
over (under) expenditures (18,338) — 18,338 (517)
Other financing sources:
Transfers in - General Fund 18,338 18,338 — —
Change in fund balance $— 18,338 (517)
Fund (deficit), at beginning of year (18,338) (17,821)
Fund (deficit), at end of year $ — (18,338)
104
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Land Sales
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources - PERS on behalf payment $12,000 3,780 (8,220) 3,920
Charges for services 5,000 24,488 19,488 3,619
Licenses, permits and fees 1,519,800 2,097,724 577,924 1,250
Investment income 2,000 8,173 6,173 3,427
Other 500 1,441 941 440
Total revenues 1,539,300 2,135,606 596,306 12,656
Expenditures:
General government:
Personnel services 121,290 115,924 5,366 98,623
Fringe benefits 72,709 56,034 16,675 49,392
Professional services 475,000 319,111 155,889 61,466
Support goods and services 959,710 61,588 898,122 69,144
Total expenditures 1,628,709 552,657 1,076,052 278,625
Excess (deficiency) of revenues
over (under) expenditures (89,409) 1,582,949 1,672,358 (265,969)
Other financing sources (uses):
Land sale proceeds 89,409 145,820 56,411 110,428
Transfers out:
Hospital Facilities Enterprise Fund (650,000) (650,000) — —
Womens Bay Road Service Area
Special Revenue Fund — — — (27,600)
Net other financing sources (uses) (560,591) (504,180) 56,411 82,828
Change in fund balance $(650,000) 1,078,769 1,728,769 (183,141)
Fund balance, at beginning of year 381,900 565,041
Fund balance, at end of year $ 1,460,669 381,900
105
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Buildings and Grounds
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources - PERS on behalf payment $30,000 2,745 (27,255) 3,790
Charges for services 729,808 751,678 21,870 676,263
Investment income 5,000 3,632 (1,368) 4,466
Other — 119 119 121
Total revenues 764,808 758,174 (6,634) 684,640
Expenditures:
General government:
School buildings 55,000 6,627 48,373 44,364
Borough building 693,308 523,951 169,357 430,331
Mental health center 16,500 6,608 9,892 5,767
Various borough buildings — 4,065 (4,065) 9,163
Project office — — — 39
Total expenditures 764,808 541,251 223,557 489,664
Excess of revenues over expenditures — 216,923 216,923 194,976
Other financing sources:
Transfers out - Renewal and Replacement Projects
Capital Project Fund (336,370) (336,370) — 34,272
Change in fund balance $ (336,370) (119,447) 216,923 229,248
Fund balance, at beginning of year 593,215 363,967
Fund balance, at end of year $ 473,768 593,215
106
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Woodland Acres Street Light Service Area
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 4,940 5,155 215 4,932
Investment income 200 153 (47) 214
Total revenues 5,140 5,308 168 5,146
Expenditures:
General government:
Support goods and services 5,140 4,817 323 4,828
Excess of revenues over
expenditures $— 491 491 318
Fund balance, at beginning of year 30,003 29,685
Fund balance, at end of year $ 30,494 30,003
(With financial information for the year ended June 30, 2016)
107
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Trinity Islands Street Light Service Area
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 2,330 2,446 116 2,334
Investment income — 136 136 190
Total revenues 2,330 2,582 252 2,524
Expenditures:
General government:
Support goods and services 2,330 1,793 537 1,798
Excess of revenues over
expenditures $— 789 789 726
Fund balance, at beginning of year 26,990 26,264
Fund balance, at end of year $ 27,779 26,990
108
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Tourism Development
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Transient accommodations tax $ 89,500 108,050 18,550 95,466
Intergovernmental - State sources -
Commerical passenger vessel tax 52,900 30,887 (22,013) 30,255
Investment income 500 948 448 1,417
Total revenues 142,900 139,885 (3,015) 127,138
Expenditures:
Community and economic development:
Personnel services 6,000 — 6,000 —
Contributions 95,000 109,521 (14,521) 85,000
Support goods and services 11,900 — 11,900 —
Total expenditures 112,900 109,521 3,379 85,000
Excess of revenues
over expenditures 30,000 30,364 364 42,138
Other financing sources (uses) -
Transfers out - Kodiak Fisheries Research
Center Enterprise Fund (45,000) (45,000) — —
Change in fund balance $(15,000) (14,636) 364 42,138
Fund balance, at beginning of year 219,550 177,412
Fund balance, at end of year $ 204,914 219,550
109
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Mission Lake Tide Gate
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 5,400 6,147 747 5,976
Investment income — 259 259 332
Total revenues 5,400 6,406 1,006 6,308
Expenditures:
Service district maintenance:
Personnel services — 255 (255) 757
Fringe benefits — 205 (205) 451
Contracted services 3,000 — 3,000 —
Support goods and services 2,400 8 2,392 12
Total expenditures 5,400 468 4,932 1,220
Excess of revenues
over expenditures $— 5,938 5,938 5,088
Fund balance, at beginning of year 48,379 43,291
Fund balance, at end of year $ 54,317 48,379
110
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Fern Fuller Trust
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
2017
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Revenues:
Investment income $ 3,500 365 (3,135) 840
Expenditures — — — —
Excess of revenues
over expenditures 3,500 365 (3,135) 840
Other financing (uses):
Transfers out -
Hospital Facilities Enterprise Fund (134,372) (134,372) — (66,500)
Change in fund balances $ (130,872) (134,007) (3,135) (65,660)
Fund balance, at beginning of year 134,007 199,667
Fund balance, at end of year $ — 134,007
111
NONMAJOR CAPITAL PROJECT FUNDS
The Borough Capital Projects Fund accounts for capital improvement projects
related to various financing sources.
The School Bond Capital Projects Fund accounts for educational related capital
projects funded by general obligation bonds which will be paid for with property taxes
and State of Alaska grants.
The State Capital Grants Fund accounts for capital improvement projects relating
to grants received from the State of Alaska.
The Kodiak High School Renovation Fund accounts for the construction and major
maintenance activites for the Borough’s educational facilities funded by bonds.
The Renewal and Replacement Projects accounts for renewal and replacement
projects.
The Other Capital Projects Fund accounts for capital improvement projects related
to various financing sources.
KODIAK ISLAND BOROUGH
Nonmajor Capital Project Funds
Combining Balance Sheet
June 30, 2017
Borough School Bond State Kodiak High Renewal and Other
Capital Capital Capital School Replacement Capital
Assets Projects Projects Grants Renovation Projects Projects 2017 2016
Equity in central treasury $113,019 658,123 432,862 464,434 — 2,081,917 3,750,355 10,890,530
Receivables:
State of Alaska — — 1,063 — — — 1,063 73,438
Federal government — — — — — 49,923 49,923 651,839
Accounts and other receivables, net — — 3,152 — 20,215 — 23,367 3,153
Total $ 113,019 658,123 437,077 464,434 20,215 2,131,840 3,824,708 11,618,960
Liabilities and Fund Balances
Liabilities:
Accounts payable — — 11,560 25,388 2,444 8,835 48,227 548,192
Due to other funds — 653,783 — — 140,449 — 794,232 381,374
Unearned revenues — — — — — 30,930 30,930 30,930
Total liabilities — 653,783 11,560 25,388 142,893 39,765 873,389 960,496
Fund balances (deficit):
Assigned 113,019 4,340 425,517 439,046 — 2,092,075 3,073,997 10,658,464
Unassigned — — — — (122,678) — (122,678) —
Total fund balances (deficit) 113,019 4,340 425,517 439,046 (122,678) 2,092,075 2,951,319 10,658,464
Total $ 113,019 658,123 437,077 464,434 20,215 2,131,840 3,824,708 11,618,960
Totals
(With summarized financial information at June 30, 2016)
112
KODIAK ISLAND BOROUGH
Nonmajor Capital Project Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit)
Year ended June 30, 2017
Borough School Bond State Kodiak High Renewal and Other
Capital Capital Capital School Replacement Capital
Projects Projects Grants Renovation Projects Projects 2017 2016
Revenues:
Property taxes and assessments $— — — — 1,402,533 — 1,402,533 —
Intergovernmental:
State sources — — 7,523 — 4,693 24,431 36,647 1,999,361
Federal sources — — — — — 798,846 798,846 1,216,909
Investment income 550 3,609 2,186 2,767 — 7,964 17,076 47,718
Other — — — — — — — 309
Total revenues 550 3,609 9,709 2,767 1,407,226 831,241 2,255,102 3,264,297
Expenditures:
General government — — — — 117,583 — 117,583 —
Capital outlay:
Schools — — — 217,474 10,000 — 227,474 428,246
General — — 59,041 — 172,291 855,485 1,086,817 3,319,610
Total expenditures — — 59,041 217,474 299,874 855,485 1,431,874 3,747,856
Excess (deficiency) of revenues
over (under) expenditures 550 3,609 (49,332) (214,707) 1,107,352 (24,244) 823,228 (483,559)
Other financing sources (uses):
Bond issuance — — — — — — — 7,010,000
Premium on bonds issued — — — — — — — 990,000
Transfers in — — — — 622,825 — 622,825 601,525
Transfers out — (272,409) — — — (57,493) (329,902) (379,580)
Net other financing sources (uses)— (272,409) — — 622,825 (57,493) 292,923 8,221,945
Change in fund balances 550 (268,800) (49,332) (214,707) 1,730,177 (81,737) 1,116,151 7,738,386
Fund balances (deficit), at beginning of year 112,469 273,140 474,849 653,753 (1,852,855) 2,173,812 1,835,168 2,920,078
Fund balances (deficit), at end of year $113,019 4,340 425,517 439,046 (122,678) 2,092,075 2,951,319 10,658,464
Totals
(With summarized financial information for the year ended June 30, 2016)
113
ENTERPRISE FUNDS
The Municipal Solid Waste Collection and Disposal Fund accounts for the
collection and disposal of solid waste and recycling services for the Kodiak Island
Borough.
The Hospital Facilities Fund accounts for rents on the Borough-owned hospital. In
turn, it purchases hospital equipment and makes debt service payments on hospital
related debt.
The Long Term Care Center Fund accounts for rents on the Borough-owned long
term care center and other related revenue. In turn, it makes debt service payments on
the long term care center related debt.
The Kodiak Fisheries Research Center Fund accounts for rents and expenses on the
Borough-owned Kodiak Fisheries Research Center. This facility, which contains salt-
water lab facilities, and its tenants are committed to the preservation of the North
Pacific marine ecosystem and resources.
The 911 Service Fund accounts for funds collected from phone charges and pays for
a 911 emergency system.
KODIAK ISLAND BOROUGH
Municipal Solid Waste Collection and Disposal
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Operating revenues:
Solid waste disposal $3,147,434 3,105,560 (41,874) 2,859,436
Other 2,000 11,390 9,390 16,314
Total operating revenues 3,149,434 3,116,950 (32,484) 2,875,750
Operating expenses:
Personnel services 1,481,302 1,319,809 161,493 1,199,794
Contracted services 254,000 303,846 (49,846) 195,581
Maintenance and repairs 648,000 106,058 541,942 57,629
Depreciation 950,925 294,025 656,900 302,905
General and administration 617,800 463,071 154,729 380,215
Recycling services 250,000 252,960 (2,960) 248,244
Closure and postclosure costs 25,000 154,010 (129,010) 2,030,954
Contributions 46,000 35,880 10,120 34,885
Total operating expenses 4,273,027 2,929,659 1,343,368 4,450,207
Operating income (loss)(1,123,593) 187,291 1,310,884 (1,574,457)
Other income (expense):
Intergovernmental:
Federal sources - debt forgiveness — — — 375,468
State of Alaska on-behalf payment 123,336 20,887 (102,449) 39,322
Investment income 30,000 30,576 576 55,983
Gain on sale of assets — — — 16,000
Interest expense (115,475) (367,158) (251,683) (287,453)
Total other income (expense)37,861 (315,695) (353,556) 199,320
Change in net position $ (1,085,732) (128,404) 957,328 (1,375,137)
Net position, at beginning of year 15,271,728 16,646,865
Net position, at end of year $ 15,143,324 15,271,728
Enterprise Funds
2017
114
KODIAK ISLAND BOROUGH
Hospital Facilities
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Operating revenues:
Lease income $720,000 660,000 (60,000) 1,959,827
Operating expenses:
Personnel services 34,000 42,436 (8,436) 22,000
General and administration 448,362 12,510 435,852 21,373
Miscellaneous — — — 34
Depreciation 1,458,551 1,121,711 336,840 1,176,745
Total operating expenses 1,940,913 1,176,657 764,256 1,220,152
Operating income (1,220,913) (516,657) 704,256 739,675
Other income (expense):
Intergovernmental:
State sources - grants — — — 11,326
Investment income 142,583 136,828 (5,755) 147,985
Contribution to Providence Hospital (108,000) (108,000) — (108,000)
Interest expense — — — (616,716)
Total other income (expense)34,583 28,828 (5,755) (565,405)
Income (loss) before transfers
and special item (1,186,330) (487,829) 698,501 174,270
Transfers in 1,089,372 1,089,372 — 66,500
Transfers out — (8,062,822) (8,062,822) (16,272)
Total transfers 1,089,372 (6,973,450) (8,062,822) 50,228
Special item:
Gain on transfer of Long Term
Care Center operations (Note 16)— 1,721,113 1,721,113 —
Change in net position $(96,958) (5,740,166) (5,643,208) 224,498
Net position, at beginning of year 21,712,849 21,488,351
Net position, at end of year $ 15,972,683 21,712,849
Enterprise Funds
2017
115
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Operating revenues:
Lease income $1,227,800 1,119,929 (107,871) —
Other — 16,623 16,623 —
Total operating revenue 1,227,800 1,136,552 (91,248) —
Operating expenses:
Insurance and bonding — 43,536 (43,536) —
Legal fees — 113 (113) —
Miscellaneous 506,638 — 506,638 —
Depreciation — 518,933 (518,933) —
Total operating expenses 506,638 562,582 (55,944) —
Operating income 721,162 573,970 (147,192) —
Other income (expense):
Investment income — 75 75 —
Interest expense (721,162) (553,977) 167,185 —
Debt issuance costs — (11,500) (11,500) —
Loss on advanced refunding of debt — (54,590) (54,590) —
Total other income (expense)(721,162) (619,992) 101,170 —
Income (loss) before transfers
and special item — (46,022) (46,022) —
Transfers in — 8,062,822 8,062,822 —
Special item:
Loss on transfer of Long Term
Care Center operations (Note 16)— (1,721,113) (1,721,113) —
Change in net position $— 6,295,687 6,295,687 —
Net position, at beginning of year — —
Net position, at end of year $ 6,295,687 —
KODIAK ISLAND BOROUGH
2017
Year ended June 30, 2017
Budget and Actual
Changes in Net Position
Schedule of Revenues, Expenses, and
Long Term Care Center
Enterprise Funds
(With financial information for the year ended June 30, 2016)
116
KODIAK ISLAND BOROUGH
Kodiak Fisheries Research Center
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Operating revenues:
Lease income $ 1,010,797 847,642 (163,155) 3,353,718
Operating expenses:
Personnel services 423,202 386,036 37,166 399,528
Maintenance and repairs 65,500 57,869 7,631 1,228
Depreciation 637,381 702,501 (65,120) 641,669
General and administration:
Support goods and services 164,500 11,529 152,971 —
Cleaning and janitorial 61,700 55,750 5,950 51,990
Heating 123,500 84,106 39,394 60,787
Electrical 149,700 165,171 (15,471) 144,181
Plumbing 45,000 59,677 (14,677) 50,408
Air conditioning 2,000 42 1,958 143
Elevators 2,500 1,800 700 2,680
Miscellaneous 8,200 7,529 671 53,839
Total operating expenses 1,683,183 1,532,010 151,173 1,406,453
Operating income (loss) (672,386) (684,368) (11,982) 1,947,265
Other income (expense):
State of Alaska on-behalf payment 34,939 6,912 (28,027) 13,788
Investment income 40,000 10,372 (29,628) 32,212
Interest revenue — 59,134 59,134 —
Interest expense — — — (148,663)
Total other income (expense)74,939 76,418 1,479 (102,663)
Income (loss) before transfers (597,447) (607,950) (10,503) 1,844,602
Transfers in 45,000 45,000 — —
Change in net position $(552,447) (562,950) (10,503) 1,844,602
Net position, at beginning of year 12,833,700 10,989,098
Net position, at end of year $ 12,270,750 12,833,700
Enterprise Funds
2017
117
KODIAK ISLAND BOROUGH
Enterprise Funds
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2017
(With financial information for the year ended June 30, 2016)
Variance with
Final Budget
Final Positive 2016
Budget Actual (Negative)Actual
Operating revenues:
Customer charges $35,000 28,409 (6,591) 30,417
Operating expenses:
Personnel services 1,500 1,500 — 1,500
Insurance & bonding 100 53 47 98
Telephone services 33,400 26,856 6,544 28,819
Total operating expenses 35,000 28,409 6,591 30,417
Operating income $— — — —
Net position, at beginning of year — —
Net position, at end of year $ — —
2017
911 Service Fund
118
SUPPLEMENTARY SCHEDULES
Fiscal Year Principal Interest Total
2018 3,870,000$ 3,408,307 7,278,307
2019 4,425,000 3,245,932 7,670,932
2020 4,605,000 3,063,032 7,668,032
2021 4,800,000 2,873,382 7,673,382
2022 5,020,000 2,653,882 7,673,882
2023 5,250,000 2,418,719 7,668,719
2024 5,505,000 2,163,708 7,668,708
2025 5,780,000 1,885,645 7,665,645
2026 4,585,000 1,651,321 6,236,321
2027 3,885,000 1,445,608 5,330,608
2028 4,075,000 1,251,627 5,326,627
2029 3,645,000 1,062,889 4,707,889
2030 3,830,000 881,178 4,711,178
2031 4,015,000 692,854 4,707,854
2032 3,590,000 501,672 4,091,672
2033 3,770,000 322,897 4,092,897
2034 2,240,000 155,057 2,395,057
2035 580,000 43,323 623,323
2036 610,000 14,713 624,713
74,080,000$ 29,735,746$ 103,815,746$
SUMMARY OF BONDED DEBT SERVICE REQUIREMENTS TO MATURITY
KODIAK ISLAND BOROUGH
June 30, 2017
Annual principal and interest requirements on General Obligation Bonds.
119
Fiscal year Interest rate
Interest due
September 01
Principal due
April 01
Interest due
March 01 Total
2018 3.12%146,475$ 330,000 146,475 622,950
2019 3.45%140,700 340,000 140,700 621,400
2020 3.70%133,900 355,000 133,900 622,800
2021 3.93%126,800 370,000 126,800 623,600
2022 4.80%119,400 385,000 119,400 623,800
2023 4.80%110,256 405,000 110,256 625,512
2024 4.80%100,638 425,000 100,638 626,276
2025 5.20%90,544 445,000 90,544 626,088
2026 5.20%79,975 465,000 79,975 624,950
2027 5.20%68,931 485,000 68,931 622,862
2028 5.20%56,503 510,000 56,503 623,006
2029 5.20%43,434 535,000 43,434 621,868
2030 5.20%29,725 565,000 29,725 624,450
2031 5.20%15,247 595,000 15,247 625,494
1,262,528$ 6,210,000$ 1,262,528$ 8,735,056$
The 2011 Series One General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide a portion of the funds needed for the Kodiak High School
Addition and Renovation.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
2011 Series One
120
Fiscal Year
Interest
Rate
Interest Due
September 1
Principal Due
September 1
Interest due
March 1 Total
2018 2.00%95,600$ 460,000 91,000 646,600
2019 4.00%91,000 480,000 81,400 652,400
2020 5.00%81,400 495,000 69,025 645,425
2021 5.00%69,025 525,000 55,900 649,925
2022 4.00%55,900 545,000 45,000 645,900
2023 5.00%45,000 570,000 30,750 645,750
2024 5.00%30,750 600,000 15,750 646,500
2025 5.00%15,750 630,000 - 645,750
484,425$ 4,305,000$ 388,825$ 5,178,250$
The 2012 Series A General Obligation School Bonds were issued to refund (refinance) the 2004 Series A General Obligation
bonds that were issued to provide funds for school and related capital improvements in the Borough, specifically to fund
various school facility repairs.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
2012 Series A
121
Fiscal Year
Interest
Rate
Interest Due
September 1
Principal Due
September 1
Interest due
March 1 Total
2018 2.00%116,775$ 565,000 111,125 792,900
2019 4.00%111,125 585,000 99,425 795,550
2020 5.00%99,425 610,000 84,175 793,600
2021 5.00%84,175 640,000 68,175 792,350
2022 4.00%68,175 665,000 54,875 788,050
2023 5.00%54,875 695,000 37,500 787,375
2024 5.00%37,500 730,000 19,250 786,750
2025 5.00%19,250 770,000 - 789,250
591,300$ 5,260,000$ 474,525$ 6,325,825$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
The 2012 Series B General Obligation School Bonds were issued to refund (refinance) the 2004 Series B General
Obligation bonds that were issued to provide funds for school and related capital improvements in the Borough,
specifically to fund construction of the new pool facility.
2012 Series B
122
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
February 01
Interest due
February 01 Total
2018 4.00%434,070$ 820,000 434,070 1,688,140
2019 5.00%417,670 855,000 417,670 1,690,340
2020 4.00%396,295 895,000 396,295 1,687,590
2021 4.00%378,395 935,000 378,395 1,691,790
2022 4.00%359,695 970,000 359,695 1,689,390
2023 4.00%340,295 1,010,000 340,295 1,690,590
2024 5.00%320,095 1,050,000 320,095 1,690,190
2025 5.00%293,845 1,100,000 293,845 1,687,690
2026 5.00%266,345 1,155,000 266,345 1,687,690
2027 5.00%237,470 1,215,000 237,470 1,689,940
2028 5.00%207,095 1,275,000 207,095 1,689,190
2029 5.00%175,220 1,340,000 175,220 1,690,440
2030 5.00%141,720 1,405,000 141,720 1,688,440
2031 5.00%106,595 1,475,000 106,595 1,688,190
2032 5.00%69,720 1,550,000 69,720 1,689,440
2033 3.80%30,970 1,630,000 30,970 1,691,940
4,175,495$ 18,680,000$ 4,175,495$ 27,030,990$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
The 2013 Series One General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide a portion of the funds needed for the Kodiak High School Addition
and Renovation.
2013 Series One
123
Fiscal Year
Interest
Rate
Interest Due
September 01
Principal Due
March 01
Interest Due
March 01 Total
2018 5.00%467,356$ 840,000 467,356 1,774,712
2019 2.00%446,356 880,000 446,356 1,772,712
2020 2.00%437,556 900,000 437,556 1,775,112
2021 5.00%428,556 915,000 428,556 1,772,112
2022 5.00%405,681 965,000 405,681 1,776,362
2023 5.00%381,556 1,010,000 381,556 1,773,112
2024 5.00%356,306 1,060,000 356,306 1,772,612
2025 3.12%329,806 1,110,000 329,806 1,769,612
2026 5.00%312,463 1,150,000 312,463 1,774,926
2027 5.00%283,713 1,205,000 283,713 1,772,426
2028 5.00%253,588 1,265,000 253,588 1,772,176
2029 5.00%221,963 1,330,000 221,963 1,773,926
2030 5.00%188,713 1,395,000 188,713 1,772,426
2031 4.50%153,838 1,465,000 153,838 1,772,676
2032 5.00%120,875 1,535,000 120,875 1,776,750
2033 5.00%82,500 1,610,000 82,500 1,775,000
2034 5.00%42,250 1,690,000 42,500 1,774,750
4,913,076$ 20,325,000$ 4,913,326$ 30,151,402$
The 2014 Series One General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide a portion of the funds needed for the Kodiak High School Addition
and Renovation.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
2014 Series One
124
Fiscal Year
Interest
Rate
Interest Due
October 01
Principal Due
October 01
Interest Due
April 01 Total
2018 2.00%147,206$ 200,000 145,206 492,412
2019 4.00%145,206 205,000 141,106 491,312
2020 5.00%141,106 215,000 135,731 491,837
2021 5.00%135,731 225,000 130,106 490,837
2022 5.00%130,106 240,000 124,106 494,212
2023 5.00%124,106 250,000 117,856 491,962
2024 5.00%117,856 265,000 111,231 494,087
2025 5.00%111,231 275,000 104,356 490,587
2026 5.00%104,356 290,000 97,106 491,462
2027 5.00%97,106 305,000 89,481 491,587
2028 5.00%89,481 320,000 81,481 490,962
2029 5.00%81,481 335,000 73,106 489,587
2030 5.00%73,106 355,000 64,231 492,337
2031 4.00%64,231 370,000 56,831 491,062
2032 5.25%56,831 390,000 46,594 493,425
2033 5.25%46,594 410,000 35,831 492,425
2034 5.25%35,831 430,000 24,544 490,375
2035 5.25%24,544 455,000 12,600 492,144
2036 5.25%12,600 480,000 - 492,600
1,738,709$ 6,015,000$ 1,591,503$ 9,345,212$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
The 2015 Series Three General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide a portion of the funds needed for the Kodiak High School Addition and
Renovation.
2015 Series Three
125
Fiscal Year
Interest
Rate
Interest Due
October 01
Principal Due
October 01
Interest Due
April 01 Total
2018 2.00%37,850$ 150,000 36,350 224,200
2019 4.00%36,350 155,000 33,250 224,600
2020 5.00%33,250 160,000 29,250 222,500
2021 5.00%29,250 170,000 25,000 224,250
2022 5.00%25,000 180,000 20,500 225,500
2023 5.00%20,500 190,000 15,750 226,250
2024 5.00%15,750 200,000 10,750 226,500
2025 5.00%10,750 210,000 5,500 226,250
2026 5.00%5,500 220,000 - 225,500
214,200$ 1,635,000$ 176,350$ 2,025,550$
The 2015 Series Three General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide for school facility renewal and replacement needs.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2017
2015 Series Three
126
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
August 01
Interest Due
February 01 Total
2018 5.00%35,209$ 65,000 33,584 133,793
2019 5.00%33,584 65,000 31,959 130,543
2020 5.00%31,959 70,000 30,209 132,168
2021 5.00%30,209 75,000 28,334 133,543
2022 5.00%28,334 80,000 26,334 134,668
2023 5.00%26,334 80,000 24,334 130,668
2024 5.00%24,334 85,000 22,209 131,543
2025 5.00%22,209 90,000 19,959 132,168
2026 5.00%19,959 95,000 17,584 132,543
2027 2.00%17,584 100,000 16,584 134,168
2028 4.00%16,584 100,000 14,584 131,168
2029 4.00%14,584 105,000 12,484 132,068
2030 2.63%12,484 110,000 11,041 133,525
2031 3.00%11,041 110,000 9,391 130,432
2032 3.00%9,391 115,000 7,666 132,057
2033 3.00%7,666 120,000 5,866 133,532
2034 3.00%5,866 120,000 4,066 129,932
2035 3.13%4,066 125,000 2,113 131,179
2036 3.25%2,113 130,000 - 132,113
353,510$ 1,840,000$ 318,301$ 2,511,811$
The 2016 Series One General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide for the Kodiak High School Addition and Renovation.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
2016 Series One
RETIREMENT SCHEDULE
June 30, 2017
127
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
August 01
Interest Due
February 01 Total
2018 5.00%122,625$ 440,000 111,625 674,250
2019 5.00%111,625 465,000 100,000 676,625
2020 5.00%100,000 490,000 87,750 677,750
2021 5.00%87,750 515,000 74,875 677,625
2022 5.00%74,875 540,000 61,375 676,250
2023 5.00%61,375 570,000 47,125 678,500
2024 5.00%47,125 595,000 32,250 674,375
2025 5.00%32,250 630,000 16,500 678,750
2026 5.00%16,500 660,000 - 676,500
654,125$ 4,905,000$ 531,500$ 6,090,625$
The 2016 Series One General Obligation School Bonds were issued to provide funds for school and related capital
improvements in the Borough, specifically to provide for school facility renewal and replacement needs.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
2016 Series One
RETIREMENT SCHEDULE
June 30, 2017
128
Fiscal Year
Interest
Rate
Interest Due
December 01
Principal Due
December 01
Interest Due
June 01 Total
2018 - 114,175$ - 114,175 228,350
2019 4.00%114,175 395,000 106,275 615,450
2020 4.00%106,275 415,000 97,975 619,250
2021 4.00%97,975 430,000 89,375 617,350
2022 4.00%89,375 450,000 80,375 619,750
2023 5.00%80,375 470,000 68,625 619,000
2024 5.00%68,625 495,000 56,250 619,875
2025 5.00%56,250 520,000 43,250 619,500
2026 5.00%43,250 550,000 29,500 622,750
2027 5.00%29,500 575,000 15,125 619,625
2028 5.00%15,125 605,000 - 620,125
815,100$ 4,905,000$ 700,925$ 6,421,025$
The 2016 Series Three General Obligation School Bonds were issued to refund (refinance) the 2008 Series A General
Obligation Bonds were issued to provide funds for school and related capital improvements in the Borough, specifically the
new school pool facility.
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
2016 Series Three
RETIREMENT SCHEDULE
June 30, 2017
129
STATISTICAL SECTION
STATISTICAL SECTION
This part of the Kodiak Island Borough’s comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the government’s overall financial
health.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand
how the government’s financial performance and well-being have changed
over time. 130-133
Revenue Capacity
These schedules contain information to help the reader assess the govern-
ment’s most significant local revenue source, the property tax. 134-138
Debt Capacity
These schedules present information to help the reader assess the afford-
ability of the government’s current levels of outstanding debt and the gov-
ernment’s ability to issue additional debt in the future. 139-143
Demographic and Economic Information
These schedules offer demographic and economc indicators to help the
reader understand the environment within which the government’s finan-
cial activities take place. 144-150
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports
for the revelant year.
2008 2009 2010 2011 2012
Governmental activities:
Net investment in capital assets $ 25,127,779 $ 71,534,766 $ 77,447,045 $ 81,789,375 $ 85,285,497
Restricted for capital projects - - - - -
Unrestricted 89,853,794 48,140,406 48,992,902 47,094,977 48,265,320
Total governmental activities net position $114,981,573 $119,675,172 $126,439,947 $128,884,352 $133,550,817
Business-type activities:
Net investment in capital assets $ 34,706,597 $ 38,135,340 $ 36,655,859 $ 35,170,143 $ 31,967,945
Unrestricted (2,862,363) (2,939,301) (598,367) 1,137,826 4,532,561
Total business-type activities net position $31,844,234 $35,196,039 $36,057,492 $36,307,969 $36,500,506
Primary government:
Net investment in capital assets $ 106,241,363 $ 115,582,385 $ 118,445,234 $ 116,959,518 $ 117,253,442
Restricted for capital projects - - - - -
Unrestricted 45,278,043 46,053,601 46,496,610 48,232,803 52,797,881
Total primary government net position $146,825,807 $154,871,211 $162,497,439 $165,192,321 $170,051,323
2013 2014 2015 2016 2017
Governmental activities:
Net investment in capital assets $ 72,773,598 $ 80,159,521 $ 82,616,865 $ 78,473,495 $ 80,857,151
Restricted for capital projects - - - 165,034 -
Unrestricted 47,149,835 46,754,461 43,472,334 49,489,422 48,293,582
Total governmental activities net position $119,923,433 $126,913,982 $126,089,199 $128,127,951 $129,150,733
Business-type activities:
Net investment in capital assets $ 21,628,143 $ 36,383,229 $ 43,884,340 $ 41,911,154 $ 40,098,010
Unrestricted 20,750,321 12,115,258 5,239,974 7,907,123 9,584,434
Total business-type activities net position $42,378,464 $48,498,487 $49,124,314 $49,818,277 $49,682,444
Primary government:
Net investment in capital assets $ 94,401,741 $ 116,542,750 $ 126,501,205 $ 120,384,649 $ 120,955,161
Restricted for capital projects - - - 165,034 -
Unrestricted 67,900,156 58,869,719 48,712,308 57,396,545 57,878,016
Total primary government net position $162,301,897 $175,412,469 $175,213,513 $177,946,228 $178,833,177
Source: Borough general ledger
Fiscal Year
Fiscal Year
KODIAK ISLAND BOROUGH
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
130
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Expenses
Governmental activities:
General government $4,226,759 $3,723,964 $4,479,415 $5,109,232 $4,281,383 $ 7,398,899 $ 6,990,640 $ 5,637,239 $ 7,850,988 $ 7,156,087
Public safety 509,697 579,710 612,763 664,349 622,396 644,197 751,637 663,145 798,079 1,028,240
Community and economic development 1,105,156 908,501 1,034,686 1,211,189 1,195,237 1,070,991 964,377 886,613 1,167,367 1,136,303
Emergency preparedness 13,841 14,988 10,511 11,705 21,423 278,480 12,487 31,628 30,849 35,861
Health and sanitation 449,792 371,673 406,087 392,011 391,996 290,800 326,700 406,093 389,000 233,999
Education, culture, and recreation 183,747 248,571 192,182 85,690 64,289 84,273 218,013 335,854 23,949 17,562
Parks and recreation - - - 13,625 5,825 21,100 37,795 161,596 87,456 30,172
Service district maintenance 378,661 398,219 543,897 593,388 705,665 479,264 631,572 534,376 626,289 475,248
Primary and secondary education 11,524,160 12,354,129 12,423,691 12,834,349 11,998,842 13,930,919 14,523,509 14,316,695 14,197,077 14,162,868
Interest on long-term debt 1,270,423 1,408,045 1,336,068 1,508,052 1,188,945 1,254,225 2,109,406 3,063,649 3,492,549 3,060,520
Total governmental activities expenses 19,662,236 20,007,800 21,039,300 22,423,590 20,476,001 25,453,148 26,566,136 26,036,888 28,663,603 27,336,860
Business-type activities:
Municipal solid waste collection and disposal 4,628,826 3,852,158 4,283,148 2,192,132 2,345,752 2,342,006 2,080,864 2,468,058 4,764,871 3,296,817
Hospital facilities 1,124,650 1,095,535 1,035,020 1,027,615 1,016,882 1,091,035 1,740,525 1,763,636 2,058,690 1,284,657
Long Term Care Center - - - - - - - - - 1,128,059
Kodiak Fisheries Research Center 2,027,432 1,960,404 1,927,580 1,847,427 1,746,952 1,775,062 1,681,111 1,486,620 1,555,116 1,532,010
911 services 107,980 43,043 42,474 53,041 2,615 87,596 39,817 33,961 30,417 28,409
Total business-type activities expenses 7,888,888 6,951,140 7,288,222 5,120,215 5,112,201 5,295,699 5,542,317 5,752,275 8,409,094 7,269,952
Total primary government expenses $27,551,124 $26,958,940 $28,327,522 $27,543,805 $25,588,202 30,748,847 32,108,453 31,789,163 37,072,697 34,606,812
Program Revenues
Governmental activities:
Charges for services:
General government $436,284 $705,166 $703,431 $658,463 $673,050 $ 549,100 $ 577,350 $ 540,052 $ 682,664 $ 2,874,794
Public safety - 12,361 12,762 33,755 11,646 13,849 14,336 13,601 16,610 14,716
Community and economic development 148,682 - - - - - - - - -
Health and sanitation 7,370 - - - - - - - - -
Education, culture, and recreation - - - - - - - - - -
Service district maintenance 28,345 25,000 25,000 27,600 1 94,076 110,313 114,516 66,151 111,146
Primary and secondary education - - - - - - - - - -
Operating grants and contributions 1,911,246 2,543,254 2,306,394 2,295,661 2,479,263 2,917,662 4,077,510 4,305,691 4,813,838 4,226,913
Capital grants 1,926,465 2,331,253 6,518,798 3,241,219 574,439 2,212,524 6,651,737 3,002,933 3,216,270 885,493
Total governmental activities program revenues 4,458,392 5,617,034 9,566,385 6,256,698 3,738,399 5,787,211 11,431,246 7,976,793 8,795,533 8,113,062
Business-type activities:
Charges for services:
Municipal solid waste collection and disposal 3,911,771 3,603,995 4,350,369 2,397,979 2,301,757 2,504,035 2,265,967 2,611,854 2,859,436 3,105,560
Hospital facilities 720,000 3,575,835 1,867,990 720,000 720,000 720,000 1,150,000 1,759,789 1,959,827 660,000
Long Term Care Center - - - - - - - - - 1,119,929
Kodiak Fisheries Research Center 1,614,532 1,598,260 1,610,775 2,018,747 1,636,728 1,603,503 1,851,322 2,267,032 3,353,718 847,642
911 services 54,925 52,654 42,474 53,041 - - - - - -
Operating grants and contributions - - - - 75,819 85,634 - 32,649 428,578 27,799
Capital grants - - - - 97,534 5,984,095 5,538,038 213,753 11,326 -
Total business-type activities program revenues 6,301,228 8,830,744 7,871,608 5,189,767 4,831,838 10,897,267 10,805,327 6,885,077 8,612,885 5,760,930
Total primary government program revenues $10,759,620 $14,447,778 $17,437,993 $11,446,465 $8,570,237 $ 16,684,478 $ 22,236,573 $ 14,861,870 $ 17,408,418 $ 13,873,992
Net (expense)/revenue:
Governmental activities $(15,203,844) $(14,390,766) $(11,472,915) $(16,166,892) $(16,737,602) $ (19,665,937) $ (15,134,890) $ (18,060,095) $ (19,868,070) $ (19,223,798)
Business-type activities (1,587,660) 1,879,604 583,386 69,552 (280,363) 5,601,568 5,263,010 1,132,802 203,791 (1,509,022)
Total primary government net expense $(16,791,504) $(12,511,162) $(10,889,529) $(16,097,340) $(17,017,965) $ (14,064,369) $ (9,871,880) $ (16,927,293) $ (19,664,279) $ (20,732,820)
General Revenues and Other Changes in Net Assets
Governmental activities:
Taxes:
Property taxes $10,118,602 $10,592,258 $11,051,740 $11,945,103 $13,327,552 $ 12,910,512 $ 13,741,190 $ 14,228,505 $ 14,414,032 $ 15,714,593
Severance taxes 1,436,210 1,311,188 1,336,075 1,649,275 1,970,265 1,774,700 1,843,819 1,703,257 1,586,555 1,414,557
Unrestricted grants and contributions 3,144,750 4,214,617 4,089,966 3,642,009 4,199,766 4,458,203 4,142,583 3,990,192 3,985,978 3,631,012
Land sales - 26,369 760 2,383 4,540 - 864,584 103,143 27,683 325,793
Investment earnings 3,912,145 2,082,615 1,219,201 713,414 1,788,903 528,676 1,106,717 574,227 604,274 271,691
Other 380,550 226,586 619,948 739,113 327,540 383,877 506,546 494,287 1,079,204 23,306
Transfers 127,050 (765,490) (80,000) (80,000) (80,000) (80,000) (80,000) (152,357) (50,228) (1,134,372)
Extraordinary item - 1,396,222 - - - - - - - -
Total governmental activities $19,119,307 $19,084,365 $18,237,690 $18,611,297 $21,538,566 $ 19,975,968 $ 22,125,439 $ 20,941,254 $ 21,647,498 $ 20,246,580
Business-type activities:
Investment earnings 434,164 273,973 198,067 100,925 282,027 117,702 178,851 80,825 236,180 177,851
Other 4,380 50 - - 110,442 78,688 598,162 186,328 203,764 115,556
Transfers (127,050) 765,490 80,000 80,000 80,000 80,000 80,000 152,357 50,228 1,134,372
Extraordinary item - 432,688 - - - - - - - (54,590)
Total business-type activities 311,494 1,472,201 278,067 180,925 472,469 276,390 857,013 419,510 490,172 1,373,189
Total primary government $19,430,801 $20,556,566 $18,515,757 $18,792,222 $22,011,035 $ 20,252,358 $ 22,982,452 $ 21,360,764 $ 22,137,670 $ 21,619,769
Change in Net Position
Governmental activities $3,915,463 $4,693,599 $6,764,775 $2,444,405 $4,800,964 $ 310,031 $ 6,990,549 $ 2,881,159 $ 1,779,428 $ 1,022,782
Business-type activities (1,276,166) 3,351,805 861,453 250,477 192,106 5,877,958 6,120,023 1,552,312 693,963 (135,833)
Total primary government $2,639,297 $8,045,404 $7,626,228 $2,694,882 $4,993,070 $6,187,989 $13,110,572 $4,433,471 $2,473,391 $886,949
KODIAK ISLAND BOROUGH
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
131
2010 2011 2012 2013 2014
General Fund:
Nonspendable $6,801 $6,801 $166,020 $6,324 $1,459
Committed - - - - -
Unassigned 1,952,757 1,952,757 3,126,037 3,340,662 3,502,489
Total General Fund $1,959,558 $1,959,558 $3,292,057 $3,346,986 $3,503,948
All other governmental funds
Nonspendable $21,704 $21,704 $5,114,902 $4,636,976 $513,765
Committed 57,633,409 57,633,409 37,288,510 37,902,356 42,355,129
Assigned - - 11,464,575 29,981,503 28,875,499
Unassigned (1,179,132) (1,179,132) (1,989,279) (51,337) (2,929,481)
Total all other governmental funds $56,475,981 $56,475,981 $51,878,708 $72,469,498 $68,814,912
2015 2016 2017
General Fund:
Nonspendable $14,566 $26,272 $32,349
Committed - - -
Unassigned 3,181,342 3,259,509 2,284,775
Total General Fund $3,195,908 $3,285,781 $2,317,124
All other governmental funds
Nonspendable $287,564 $181,191 $419,212
Committed 42,606,097 43,081,680 44,035,100
Assigned 7,610,272 11,312,217 7,066,350
Unassigned (2,516,222) (1,885,239) (190,718)
Total all other governmental funds $47,987,711 $52,689,849 $51,329,944
The Kodiak Island Borough implemented GASB 54 in Fiscal Year 2011. That is why there is only eight years of data.
KODIAK ISLAND BOROUGH
Fund Balances of Governmental Funds
Last Eight Fiscal Years
(modified accrual basis of accounting)
132
Fiscal Year
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues:
Property taxes and assessments $ 10,175,295 10,477,347 10,993,175 11,909,806 13,052,598 12,936,796 13,656,771 14,091,503 14,310,687 15,700,272
Transient accommodations tax 79,182 88,338 86,003 96,384 87,400 96,640 75,142 104,074 95,466 108,050
Intergovernmental:
State sources 4,428,472 5,966,808 10,610,231 7,029,684 5,313,092 7,929,017 12,938,158 10,332,739 8,870,802 6,134,338
Federal sources 2,553,990 3,122,316 2,338,468 2,149,205 1,940,376 1,659,372 1,933,672 2,093,987 3,090,533 2,628,537
Severance taxes 1,436,210 1,311,188 1,336,075 1,649,275 1,970,265 1,774,700 1,843,819 1,703,257 1,491,089 1,306,507
Licenses, permits, fees, and other local revenues 658,381 742,527 766,193 719,818 684,697 657,025 701,999 688,719 774,225 3,014,816
Other revenues 353,850 418,741 459,412 720,659 44,304 52,516 50,556 17,747 45,422 9,146
Investment earnings 3,918,008 2,088,915 1,225,938 706,677 1,857,413 536,903 1,115,466 583,677 648,987 271,691
Total revenues 23,603,388 24,216,180 27,815,495 24,981,508 24,950,145 25,642,969 32,315,583 29,615,703 29,327,211 29,173,357
Expenditures:
General government 3,818,544 4,067,024 4,600,601 4,818,287 4,848,805 5,307,199 5,449,505 6,333,724 5,307,245 5,281,999
Public safety 385,529 460,826 502,491 537,623 447,479 469,280 576,720 524,169 572,839 699,118
Community and economic development 923,203 908,501 1,034,686 1,211,189 1,195,237 1,070,991 964,377 1,153,985 1,069,639 1,096,928
Emergency preparedness 5,713 12,488 8,011 11,705 18,923 18,342 9,987 29,128 30,849 35,861
Health and sanitation department 387,053 333,747 371,321 392,011 391,996 290,800 326,700 406,093 389,000 233,999
Education, culture, and recreation 183,747 248,571 192,182 85,690 64,289 84,273 95,625 24,856 23,949 17,562
Parks and recreation — — — 13,625 5,825 21,100 37,795 161,596 87,456 30,172
Service district maintenance 374,320 398,219 543,897 593,388 705,665 479,264 631,572 534,376 626,289 475,248
Primary and secondary education 9,123,412 9,956,618 9,980,350 10,127,350 10,337,349 10,442,350 10,845,220 11,100,714 11,100,650 10,373,548
Capital outlay:
Schools 7,029,628 14,857,064 7,359,932 1,881,069 5,255,037 5,486,672 34,872,235 21,984,655 13,240,920 3,936,147
General 887,189 1,277,106 4,319,438 4,839,652 562,007 2,041,674 1,521,996 2,907,018 3,430,975 1,086,817
Debt service:
Principal 2,205,441 2,495,056 2,685,606 2,750,690 2,780,776 2,966,441 3,645,950 2,646,040 3,201,002 3,530,000
Interest 1,263,176 1,578,408 1,356,872 1,292,645 2,695,657 1,254,225 2,109,406 3,121,577 3,194,612 3,568,559
Other charges - bond issuance costs — 68,635 — 40,689 100,149 20,809 89,835 — 124,372 64,313
Total expenditures 26,586,955 36,662,263 32,955,387 28,595,613 29,409,194 29,953,420 61,176,923 50,927,931 42,399,797 30,430,271
Excess of revenues over (under) expenditures (2,983,567) (12,446,083) (5,139,892) (3,614,105) (4,459,049) (4,310,451) (28,861,340) (21,312,228) (13,072,586) (1,256,914)
Other Financing Sources (Uses):
Proceeds from sales of bonds 8,000,000 — — 8,049,233 — 21,595,000 22,660,000 — 15,000,000 4,905,000
Bond premium — — — — — 3,424,819 2,427,432 — 2,141,115 806,205
Refunding bonds issued — 6,740,000 — — 13,578,039 — — — — —
Payment to refunding escrow — (6,865,467) — — (12,180,000) — — — — (5,934,301)
Proceeds from sale of assets — — — — — 9,564 — — — 140,000
Land sale proceeds 19,458 30,561 138,867 15,021 10,735 6,787 356,284 329,344 110,428 145,820
Insurance proceeds — — — — — — — — 403,958 —
Transfers in 2,966,610 6,144,301 3,211,195 3,782,289 957,652 6,212,885 992,365 642,691 1,404,497 1,758,036
Transfers out (2,839,560) (6,909,791) (3,291,195) (3,862,289) (1,037,652) (6,292,885) (1,072,365) (795,048) (1,454,725) (2,892,408)
Total other financing sources(uses) 8,146,508 (860,396) 58,867 7,984,254 1,328,774 24,956,170 25,363,716 176,987 17,605,273 (1,071,648)
Net change in fund balances $ 5,162,941 (13,306,479) (5,081,025) 4,370,149 (3,130,275) 20,645,719 (3,497,624) (21,135,241) 4,532,687 (2,328,562)
Debt service as a percentage of noncapital expenditures 19.45 % 20.56 % 19.41 % 18.53 % 27.22 % 17.62 % 22.51 % 21.71 % 23.80 % 26.84 %
KODIAK ISLAND BOROUGH
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
133
KODIAK ISLAND BOROUGH
General Revenues by Source(a)
Last Ten Fiscal Years
Licenses, Inter-
Fiscal Permits Governmental Investment Operating Miscellaneous
Year Taxes and Fees Revenue Income Transfers Revenue Total
2008 10,792,741 100,256 3,276,741 544,926 — — 14,714,664
2009 10,864,441 65,417 4,461,624 292,825 — 131,944 15,816,251
2010 11,219,182 71,319 4,123,507 178,567 — 38,352 15,630,927
2011 12,412,832 72,394 3,642,009 (21,628) — 537,235 16,642,842
2012 2,291,625 65,421 4,425,447 281,792 — 16,177 7,080,462
2013 2,035,971 66,476 4,787,308 39,078 29,335 30,733 6,988,901
2014 2,051,794 82,713 4,605,916 23,804 — 14,328 6,778,555
2015 1,938,286 86,916 5,163,300 (18,330) — 19,468 7,189,640
2016 1,712,846 66,151 4,132,063 54,211 — 37,473 6,002,744
2017 1,727,620 83,546 3,738,157 11,059 — 3,715 5,564,097
(a) Includes General Fund only.
Source: Borough general ledger.
134
KODIAK ISLAND BOROUGH
Assessed and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
Ratio of
Total Taxable
Total Assessed to
Real Property Personal Property Total Direct Total
Year Ended Net Taxable Full Value Net Taxable Full Value Net Taxable Full Value Tax Full Value
June 30,Assessed Value Determination Assessed Value Determination Assessed Value Determination Rate Determination
2008 734,527,929 941,403,800 100,997,608 298,543,700 805,681,814 1,239,947,500 10.50 64.98
2009 765,152,958 817,641,308 105,320,027 233,623,664 835,525,537 1,051,264,972 10.50 79.48
2010 805,000,744 855,452,864 108,014,241 227,294,006 870,472,985 1,082,746,870 10.50 80.39
2011 875,787,940 931,330,970 113,091,185 250,671,059 913,014,985 1,182,002,029 10.50 77.24
2012 947,611,296 1,007,199,396 91,612,537 236,610,137 1,039,223,833 1,243,809,533 10.50 83.55
2013 984,146,580 1,049,746,680 108,821,700 137,074,800 1,092,968,280 1,186,821,480 10.75 92.09
1,029,239,311 1,100,702,180 102,237,300 286,425,000 1,131,476,611 1,387,127,180 10.75 81.57
1,068,647,102 1,137,024,180 113,251,900 361,886,700 1,181,899,002 1,498,910,880 10.75 78.85
1,084,317,572 1,161,805,872 118,559,600 348,158,100 1,202,877,172 1,509,963,972 10.75 79.66
2017 1,169,223,198 1,256,477,176 143,116,200 154,899,290 1,312,339,398 1,411,376,466 10.75 92.98
Sources: Borough assessment and tax records
Notes: Property in Kodiak Island Borough is reassessed once every three years.
Property is assessed at actual value; therefore, the assessed values are equal to actual value,
Tax rates are per $1,000 of assessed value.
Fiscal
2014
2016
2015
$0
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Last Ten Years Assessed Values
135
KODIAK ISLAND BOROUGH
Direct and Overlapping Property Tax Rates and
Contributions to the School District
Last Ten Fiscal Years
Overlapping Rates
Woodland²Trinity²Mission²
Fiscal Acres Islands Lake Fire Areas²
Year Borough Education Renewal City¹Street Street Tide Road Services Areas²Fire
Ended Basic Support Debt and of Lighting Lighting Gate Monashka Service Bay View Womens Protection Womens
June 30, Rate Fund Service Replacement Kodiak Area Area Area Bay District 1 Road Bay Area No. 1 Bay Airport
2008 10.50 — — — 2.00 — 0.50 1.00 2.50 1.25 1.00 2.00 1.50 1.25 1.25
2009 10.50 — — — 2.00 0.25 0.50 1.00 2.50 1.50 1.00 2.00 1.50 1.25 1.25
2010 10.50 — — — 2.00 0.25 0.50 1.00 2.50 1.50 1.00 2.00 1.50 1.25 1.25
2011 10.50 — — — 2.00 0.25 0.50 1.00 2.50 1.50 1.00 2.50 1.50 1.25 1.25
2012 0.03 9.09 1.55 0.08 2.00 0.25 0.50 1.00 2.50 1.50 1.00 2.50 1.50 1.25 1.25
2013 0.03 9.03 1.61 0.08 2.00 0.25 0.50 1.00 2.50 0.50 1.75 2.50 1.50 1.25 1.25
2014 0.03 8.75 1.81 0.16 2.00 0.25 0.50 1.00 2.50 1.50 1.50 2.50 1.50 1.25 1.25
2015 0.06 9.16 0.99 0.54 2.00 0.25 0.50 1.00 2.50 1.50 1.50 2.50 1.50 1.25 1.25
2016 0.10 8.45 1.70 0.50 2.00 0.10 0.20 1.00 2.50 1.50 1.50 2.50 1.50 1.25 1.25
2017 0.15 7.62 1.91 1.07 2.00 0.10 0.20 1.00 2.50 1.50 1.50 2.50 1.50 1.25 1.25
Note: With the excection of a mill rate to cover Debt Service, the maximum mill rate allowed by State code is 30 mills
¹Overlapping rates are those of local governments that apply to property owners within the City of Kodiak.
²Overlapping rates are those which apply to property owners located within special taxing districts in the borough. They do not apply to every property owner in the Borough.
Direct
Rate
(per $1,000 of Assessed Value)
136
KODIAK ISLAND BOROUGH
Property Tax Levies and Collections
Last Ten Fiscal Years
Collections
in Subsequent
Years Amount
2008 $ 9,979,775 $ 9,615,784 96.4 $ 361,432 $ 9,977,216 100.0
2009 10,231,461 10,201,209 99.7 25,003 10,226,212 99.9
2010 10,879,276 10,487,467 96.4 383,986 10,871,453 99.9
2011 (a) 11,536,758 11,499,457 99.7 97,223 11,596,680 100.5
2012 (a) 13,255,665 13,038,077 98.4 278,623 13,316,700 100.5
2013 (a) 13,581,524 13,489,190 99.3 142,083 13,631,273 100.4
2014 14,424,260 14,250,305 98.8 113,549 14,363,854 99.6
2015 15,009,704 14,749,222 98.3 126,394 14,875,616 99.1
2016 15,261,029 15,032,113 98.5 160,138 15,192,251 99.5
2017 $ 16,642,674 16,554,392 99.5 $ — $ 16,554,392 99.5
Source: Borough general ledger.
(a) Due to personal property audits in subsequent years, tax collections exceeded original taxes levied.
June 30,
Ended
Fiscal Year
Collected within the
Fiscal Year of the Levy Total Collections to DateTaxes Levied
for the
Fiscal Year (a)
Percentage
of LevyAmount of Levy
Percentage
137
KODIAK ISLAND BOROUGH
Principal Property Tax Payers
Current Year and Ten Years Ago
Percentage Percentage
Taxable of Total Borough Taxable of Total Borough
Assessed Assessed Assessed Assessed
Taxpayer Value Rank Value Value Rank Value
Trident Seafoods Corp $ 73,267,600 1 5.6% $ — — —
Matson Navigation (a) 41,599,900 2 3.2% 7,320,949 8 0.9%
Ocean Beauty Seafoods 35,626,000 3 2.7% 14,245,989 1 1.8%
North Pacific Seafoods 21,024,700 4 1.6% — 6 0.0%
Int'l Seafoods of Alaska 20,862,000 5 1.6% 10,879,502 4 1.4%
Mill Bay Plaza Assoc Ltd 11,641,800 6 0.9% 8,648,400 5 1.1%
Wal-Mart/Sam's Club 9,750,200 7 0.7% 8,322,087 7 1.0%
GCI Communication Corp. 9,144,400 8 0.7% — —
Island Fish Co. LLC 6,779,100 9 0.5% — —
Koncor Forest Products 6,151,700 10 0.5% 6,797,500 9 0.8%
Brechan Enterprises, Inc — — — 8,496,630 6 1.1%
Westward Seafoods, Inc. — — — 11,852,090 2 1.5%
Alaska Communications Systems — — — 11,645,093 3 1.4%
Afognak Native Corp — — — 6,730,109 10 0.8%
Total $235,847,400 18.0% $94,938,349 11.8%
Source: Borough tax records.
(a) Matson Navigation purchased Horizon Lines in 2012.
2017 2008
138
Net
Total Taxable Net Debt Per
Fiscal Assessed Bonded Per Assessed
Year Population Value Debt Capita Value
2008 13,954 (a) 835,525,537 34,957,269 2,505 4.18%
2009 13,860 (a) 570,472,985 32,534,424 2,347 5.70%
2010 13,592 (a) 913,014,985 29,838,432 2,195 3.27%
2011 13,870 (a) 988,879,125 35,124,211 2,532 3.55%
2012 14,041 (a) 1,039,223,833 33,510,913 2,387 3.22%
2013 13,824 (a) 1,085,968,280 55,236,114 3,996 5.09%
13,797 (a) 1,131,476,611 76,227,556 5,525 6.74%
13,819 (a) 1,181,899,002 73,131,566 5,292 6.19%
13,790 (b) 1,202,877,172 86,481,657 6,271 7.19%
2017 13,563 (b) 1,312,339,398 82,302,899 6,068 6.27%
Sources: Information obtained from assessment records and Borough general ledger except as otherwise noted.
(a) Information obtained from State of Alaska, Division of Community and Regional Affairs,
Community Database, Certified Population for Revenue Sharing Program.
(b) Information obtained from State of Alaska, Department of Labor, Economic Information.
Note: Detail regarding the Borough's outstanding debt can be found in the notes to the financial statements.
KODIAK ISLAND BOROUGH
Ratios of Net Bonded Debt
Last Ten Fiscal Years
2014
2016
2015
139
KODIAK ISLAND BOROUGH
Debt
Outstanding
Kodiak Island Borough:
General obligation bonds $ 74,080,000
City of Kodiak:
General obligation bonds 6,565,000
Total $80,645,000
Sources: Borough general ledger and City of Kodiak records.
June 30, 2017
Direct and Overlapping Debt
140
2008 2009 2010 2011 2012
Taxable Assessed value $ 835,525,537 870,472,985 913,014,985 988,879,125 1,039,223,833
Plus exempt property 50,194,170 45,188,050 50,452,120 55,543,030 59,588,100
Total $885,719,707 915,661,035 963,467,105 1,044,422,155 1,098,811,933
2013 2014 2015 2016 2017
Taxable Assessed value 1,085,968,080 1,131,476,611 1,181,899,002 1,202,877,172 1,312,339,398
Plus exempt property 65,600,100 71,462,869 68,377,078 77,488,300 87,253,178
Total 1,151,568,180 1,202,939,480 1,250,276,080 1,280,365,472 1,399,592,576
The State of Alaska does not mandate a debt limit to its municipalities and political subdivisions.
Debt capacity is ultimately determined by the voters and the marketplace.
Source: Borough assessment records (certified tax rolls).
KODIAK ISLAND BOROUGH
Legal Debt Margin Information
Last Ten Fiscal Years
141
KODIAK ISLAND BOROUGH
Ratio of Annual Debt Service Expenditures
for General Bonded Debt to Total
General Governmental Expenditures and Transfers
Last Ten Fiscal Years
Total General Ratio of
Fund debt service
Fiscal Interest Total debt expenditures to general
year Principal (a) and fees service and transfers expenditures
2008 2,205,441 1,255,313 3,460,754 14,277,498 24.2
2009 2,495,056 1,571,295 4,066,351 15,922,441 25.5
2010 2,685,606 1,350,620 4,036,226 16,372,540 24.7
2011 2,750,690 1,287,822 4,038,512 17,065,960 23.7
2012 2,780,776 2,691,426 5,472,202 5,747,963 95.2
2013 2,966,441 1,244,233 4,210,674 6,933,972 60.7
3,645,950 2,107,198 5,753,148 6,621,593 86.9
2,646,040 3,120,449 5,766,489 7,497,680 76.9
3,201,002 3,194,612 6,395,614 6,576,153 97.3
2017 3,530,000 3,632,872 7,162,872 6,532,754 109.6
(a) Serial maturities in the case of serial bonds; annual Debt Service Fund requirements in the case of
term bonds.
Sources: Borough general ledger and debt documents.
2014
2016
2015
142
KODIAK ISLAND BOROUGH
Ratios of Outstanding Debt by Type
General Total Percent of
Obligation Notes Revenue Notes Primary Personal Per
Bonds Payable Bonds Payable Government Income Capita
34,957,269 72,028 — 1,768,660 36,797,957 6.71% 2,637
32,534,424 66,505 — 1,864,503 34,465,432 5.96% 2,487
29,838,432 60,899 — 1,989,995 31,889,326 5.52% 2,346
35,124,211 55,209 — 2,735,778 37,915,198 5.87% 2,734
33,510,913 49,433 — 7,603,249 41,163,595 6.13% 2,932
55,236,114 42,992 18,817,320 7,346,324 81,442,750 12.10% 5,891
76,227,556 37,042 18,703,498 10,206,895 105,174,991 13.98% 7,623
73,131,566 31,002 17,984,677 9,908,184 101,055,429 12.51% 7,313
86,481,657 — 17,245,855 18,445,504 122,173,016 15.12% 8,860
82,302,899 — 11,874,871 19,139,725 113,317,495 * 8,355
Note: Detail regarding the Borough's outstanding debt can be found in the notes to the financial statements.
* Information not available at report time.
2017
2014
2008
2009
2013
2012
2011
2015
Governmental Activities Business-type Activities
2016
Last Ten Fiscal Years
Fiscal
Year
2010
143
KODIAK ISLAND BOROUGH
Demographic and Economic Statistics
Last Ten Years
Per Capita Percentage
Calendar Personal Personal School Unemployment
Year Population (a) Income (c) Income (c) Enrollment (b) Rate (c)
2008 13,954 548,099,000 39,279 2,671 6.6
2009 13,860 577,818,419 41,690 2,598 7.1
2010 13,592 578,018,380 42,526 2,567 7.4
2011 13,870 646,461,681 46,609 2,543 7.4
2012 14,041 671,556,096 47,828 2,517 6.7
2013 13,824 673,348,788 48,709 2,513 6.2
13,797 752,337,000 54,529 2,468 5.7
13,819 807,817,000 58,457 2,446 4.9
13,790 808,036,000 58,596 2,437 5.0
2017 13,563 * * 2,386 *
Sources:
(a) State of Alaska, DCRA certified population.
(b)Alaska Dept of Education, Average Daily Membership by Fiscal Year at www.eed.state.ak.us/stats
(c)Bureau of Economic Analysis https://www.bea.gov
* Information not available at report time.
2016
2014
2015
—
5,000
10,000
15,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Borough Population and Student Count
Population (a)School Enrollment (b)
144
Fiscal Year 2008 Fiscal Year 2009 Fiscal Year 2010 Fiscal Year 2011
Average Average Average Average Average Average Average Average
Monthly Monthly Monthly Monthly Monthly Monthly Monthly Monthly
Employment Earnings Employment Earnings Employment Earnings Employment Earnings
Total Industries 5,803 $ 3,111 5,961 $ 3,100 5,961 $ 3,100 6,416 $ 3,362
Private Ownership 4,340 3,006 4,485 2,956 4,485 2,956 4,898 3,263
Total Government 1,483 3,424 1,475 3,538 1,475 3,538 1,518 3,681
Private Goods-Producing 1,778 3,484 1,814 3,290 1,814 3,290 2,113 3,619
Private Service-Providing 2,562 3,006 2,671 2,730 2,671 2,730 2,785 2,993
Fiscal Year 2012 Fiscal Year 2013 Fiscal Year 2014 Fiscal Year 2015
Average Average Average Average Average Average Average Average
Monthly Monthly Monthly Monthly Monthly Monthly Monthly Monthly
Employment Earnings Employment Earnings Employment Earnings Employment Earnings
Total Industries 6,461 $ 3,488 6,411 $ 3,459 6,472 $ 3,575 6,524 $ 3,650
Private Ownership 4,898 3,412 4,928 3,358 5,049 3,491 5,148 3,565
Total Government 1,501 3,742 1,483 3,795 1,423 3,875 1,377 3,966
Private Goods-Producing 2,193 3,801 2,138 3,704 2,219 3,831 2,268 3,832
Private Service-Providing 2,760 3,101 2,790 3,092 2,830 3,224 2,879 3,356
Fiscal Year 2016 Fiscal Year 2017
Average Average Average Average
Monthly Monthly Monthly Monthly
Employment Earnings Employment Earnings
Total Industries 6,154 $ 3,292 6,294 $ 3,540
Private Ownership 4,721 3,118 4,867 3,407
Total Government 1,433 3,867 1,427 3,995
Private Goods-Producing 2,012 2,766 1,934 3,318
Private Service-Providing 2,710 3,378 2,933 3,466
KODIAK ISLAND BOROUGH
Average Monthly Employment & Earnings
Last Ten Fiscal Years
145
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Land area - square miles 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130
Miles of improved street 25.6 25.6 25.6 25.6 25.6 26.1 26.1 26.1 26.1 26.1
Building permits:
Permits issued 190 192 208 204 167 219 155 193 216 143
Value of buildings (thousands) 33,145 15,007 16,445 30,832 10,171 91,619 36,652 36,216 10,866 11,793
Fire Protection:
Number of fire stations 2 2 2 2 2 2 2 2 2 2
Number of employees 1 1 1 1 1 1 1 1 1 1
Police Protection: none
(provided by the City of Kodiak within the city limits and by the State of Alaska outside the city boundaries.)
Recreation:
Parks (number of acres) 223 223 223 224 224 224 224 224 224 224
Facilities:
Number of playgrounds 15 15 15 16 16 16 16 16 16 16
Number of swimming pools 1 1 1 1 1 1 1 1 1 1
Public Education:
Number of schools:
Kodiak Area Elementary 4 4 4 4 4 4 4 4 4 4
Kodiak Area Middle School 1 1 1 1 1 1 1 1 1 1
Kodiak Area High School 1 1 1 1 1 1 1 1 1 1
Village Schools (a) 6 7 7 8 8 8 7 7 7
Number of support personnel (b) 205 217 217 215 215 193 181 187 200 206
Number of teachers (c) 218 203 218 201 201 207 162 166 170 177
Number of students (d) 2,671 2,598 2,567 2,543 2,543 2,513 2,468 2,446 2,437 2,386
Number of Municipal Employees 43 43 43 43 45 45 48 45 43 44.5
Sources: Borough Departments, Kodiak Island Borough School District and City of Kodiak
(a) The majority of Village Schools are grades K-12. (c) School district personnel figures include staffing from the General Fund and Grants.
(b) All non-teaching employees. (d) Alaska Dept of Education & Early Development, Average District Enrollment www.eed.state.ak.us/stats
KODIAK ISLAND BOROUGH
MISCELLANEOUS STATISTICAL DATA
Last Ten Fiscal Years
146
KODIAK ISLAND BOROUGH
Property Value, Construction, and Bank Deposits
Last Ten Fiscal Years
Construction Property Value*
Commercial Residential
Fiscal No. of No. of
year permits Value permits Value Commercial Residential
2008 53 25,269,361 129 7,875,188 139,416,000 275,369,008 542,272,300
2009 50 34,081,887 147 7,848,428 175,141,000 312,122,205 595,391,145
2010 52 4,756,124 156 11,689,178 192,000,000 327,248,533 661,630,592
2011 46 24,165,884 158 6,666,400 194,289,000 317,950,418 721,273,415
2012 48 5,693,295 119 4,477,641 227,392,000 345,529,161 738,505,519
2013 59 85,969,566 160 5,649,717 230,391,000 364,353,810 767,122,801
44 33,062,171 111 3,589,833 252,999,000 386,480,100 788,418,800
61 31,146,134 141 5,644,907 239,000,000 402,319,200 800,640,400
56 4,882,606 160 5,983,768 245,354,000 452,535,972 750,341,200
2017 13 4,599,616 130 7,193,534 243,973,000 557,583,376 754,756,022
*Assessed value.
Sources: Borough assessing records and City of Kodiak building department and FDIC.
Deposits in
local banks
2016
2014
2015
—
50,000,000
100,000,000
150,000,000
200,000,000
250,000,000
300,000,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deposits in Kodiak Banks
147
2008 2009 2010 2011 2012
Function:
General Government 27 31 29 29 30
Community and Economic Development 5 5 5 5 6
Municipal Solid Waste Collection and Disposal 7 7 7 7 7
Kodiak Fisheries Research Center 2 2 2 2 2
Total 41 45 43 43 45
2013 2014 2015 2016 2017
Function:
General Government 30 33 30 29 28.5
Community and Economic Development 6 5 4 5 6
Municipal Solid Waste Collection and Disposal 7 8 9 7 8
Kodiak Fisheries Research Center 2 2 2 2 2
Total 45 48 45 43 44.5
Source: Borough Finance Department
Full-time Equivalent Employees
as of June 30:
KODIAK ISLAND BOROUGH
Full-Time Equivalent Borough Employees by Function/Program
Last Ten Fiscal Years
148
KODIAK ISLAND BOROUGH
Operating Indicators by Function
Last Ten Fiscal Years
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Function
General Government
Elections
Number of registered voters 9,587 9,599 9,649 9,619 9,479 9,585 9,209 9,100 9,585 9,453
Number voting in last election 2,105 2,477 2,477 2,311 2,139 1,250 1,566 1,968 1,800 2,303
Percent of registered voters 22% 26% 26% 24% 23% 13% 17% 22% 19% 24%
Public Safety
Number of fire stations 2 2 2 2 2 2 2 2 2 2
Number of employees 1 1 1 1 1 1 1 1 1 1
Community and economic development
Zoning compliance permits issued 214 203 245 149 113 160 111 183 161 177
Junk cars removed 261 83 89 218 27 22 28 37 21 10
Primary and secondary education
Number of students 2,671 2,598 2,567 2,543 2,517 2,513 2,468 2,446 2,437 2,386
Number of General Fund certified staff 218 225 224 217 211 207 186 177 183 196
Number of General Fund classified staff 137 135 135 162 166 193 161 166 173 187
Solid waste disposal
Total solid waste disposal in tons 14,730 14,429 14,580 14,896 16,558 14,688 11,826 12,364 12,876 11,646
Baled waste in tons 10,843 10,212 10,527 10,846 10,153 11,535 10,005 8,900 10,454 9,875
Scrap metal in tons 360 205 282 260 147 251 172 205 221 190
Asbestos, cubic yards 112 324 218 230 116 399 390 362 219 179
Source: Borough Finance Department
149
Function program 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
GOVERNMENTAL ACTIVITIES
Number of buildings (teachery housing, schools and office buildings)18 18 18 18 19 19 19 19 21 20
Vehicles 10 13 13 15 15 15 14 14 11 14
Streets (miles) 25.6 25.6 25.6 25.6 26.1 26.1 26.1 26.1 26.1 26.1
Land area - square miles 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130 7,130
(provided by the City of Kodiak within the city limits and by the State of Alaska outside the city boundaries)
2 2 2 2 2 2 2 2 2 2
12 11 8 15 13 13 12 12 10 11
1 1 1 1 1 1 1 1 1 1
BUSINESS-TYPE ACTIVITES
Number of Baler Facilities (Landfills) 1 1 1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1 1 1
- - - - - - - - 1 1
223 223 223 224 224 224 224 224 224 224
1 1 1 1 1 1 1 1 1 1
15 15 15 16 16 16 16 16 16 16
1 1 1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1 1 1
Sources : Supplied by Kodiak Island Borough Department Heads
Notes : No capital asset indicators are available for the library function
A description of the Kodiak Island Borough's Capitalization and Depreciation policy
is included in the Notes To The Basic Financial Statements
Kodiak Island Research Facilities (marine research)
Dorm facility (6 apartments)
KODIAK ISLAND BOROUGH
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
Parks (number of acres)
Facilities:
Hospital
Culture, Parks and Recreation
Roads
Police: none
Fire and Emergency Services
Number of fire stations
Number of Swimming Pools
Number of playgrounds
Number of Emergency response vehicles
Emergency Tsunami Shelters
Municipal Solid Waste
Community Health & Public Services
Mental Health Facilities
Long Term Care Center
150