CAFR FY2018
KODIAK ISLAND BOROUGH
Comprehensive Annual Financial Report
Year Ended June 30, 2018
KODIAK ISLAND BOROUGH
Comprehensive Annual Financial Report
Year Ended June 30, 2018
Official Issuing Report
Dora Cross
Finance Director
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS
June 30, 2018
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 10-13
Management’s Discussion and Analysis 14-27
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position 28
Statement of Activities 29
Fund Financial Statements:
Balance Sheet – Governmental Funds 30
Reconciliation of Net Position Between the Government-Wide and the Fund Financial
Statements 31
Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficits) –
Governmental Funds 32
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund
Balances (Deficits) of Governmental Funds to the Statement of Activities 33
Statement of Net Position – Proprietary Funds – Business-Type Activities – Enterprise
Funds 34
Statement of Revenues, Expenses, and Changes in Net Position – Proprietary Funds –
Business-Type Activities – Enterprise Funds 35
Statement of Cash Flows – Proprietary Funds – Business-Type Activities – Enterprise
Funds 36-37
Notes to Basic Financial Statements 38-83
Required Supplementary Information:
Budgetary Comparison Schedule – General Fund 84-85
Budgetary Comparison Schedule – Special Revenue Fund – Education Support 86
Budgetary Comparison Schedule – Special Revenue Fund – Facilities 87
Notes to Required Supplementary Information – Budgetary Comparison Schedules 88
Schedule of Borough’s Proportionate Share of the Net Pension Liability –
Public Employees’ Retirement System 89
Schedule of Borough’s Proportionate Share of the Net OPEB Liability –
Public Employees’ Retirement System 90
Schedule of Borough’s Contributions (Pensions) –
Public Employees’ Retirement System 91
Schedule of Borough’s Contributions (OPEB) –
Public Employees’ Retirement System 92
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS, CONTINUED
Page
Additional Supplementary Information:
Budgetary Comparison Schedule – Debt Service Fund – Education 93
Nonmajor Governmental Funds:
Combining Balance Sheet 94
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 95
Nonmajor Special Revenue Funds:
Combining Balance Sheet 96-97
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
(Deficit) 98-99
Schedule of Revenues, Expenditures, and Changes in Fund Balance (Deficit) – Budget
and Actual:
Fire and Road Service Areas:
Fire:
Fire Protection Area No. 1 100
Womens Bay Fire Department 101
Kodiak Airport Fire District 102
Road:
Monashka Bay Road Service Area 103
Service Area No. 1 104
Womens Bay Road Service Area 105
Bay View Road Service Area 106
Service Area No. 2 107
L.E.P.C. 108
Land Sales 109
Buildings and Grounds 110
Woodland Acres Street Light Service Area 111
Trinity Islands Street Light Service Area 112
Tourism Development 113
Mission Lake Tide Gate 114
Nonmajor Capital Project Funds:
Combining Balance Sheet 115
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficit) 116
Enterprise Funds:
Schedule of Revenues, Expenses, and Changes in Net Position – Budget
and Actual:
Municipal Solid Waste Collection and Disposal 117
Hospital Facilities 118
Long Term Care Center 119
Kodiak Fisheries Research Center 120
911 Services Fund 121
(continued)
KODIAK ISLAND BOROUGH
TABLE OF CONTENTS, CONTINUED
Supplementary Bond Schedules:
Summary of Bonded Debt Service Requirements to Maturity 122
General Obligation Bond, 2011 Series One – Retirement Schedule 123
General Obligation Bond, 2012 Series A – Retirement Schedule 124
General Obligation Bond, 2012 Series B – Retirement Schedule 125
General Obligation Bond, 2013 Series One – Retirement Schedule 126
General Obligation Bond, 2014 Series One – Retirement Schedule 127
General Obligation Bond, 2015 Series Three – Retirement Schedule 128
General Obligation Bond, 2015 Series Three – Retirement Schedule 129
General Obligation Bond, 2016 Series One – Retirement Schedule 130
General Obligation Bond, 2016 Series One – Retirement Schedule 131
General Obligation Bond, 2016 Series Three – Retirement Schedule 132
STATISTICAL SECTION:
Statistical Section Index
Net Position by Component – Last Ten Fiscal Years 133
Changes in Net Position – Last Ten Fiscal Years 134
Fund Balances of Governmental Funds – Last Eight Fiscal Years 135
Changes in Fund Balances of Governmental Funds – Last Ten Fiscal Years 136
General Revenues by Source – Last Ten Fiscal Years 137
Assessed and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years 138
Direct and Overlapping Property Tax Rates and Contributions to the School District –
Last Ten Fiscal Years 139
Property Tax Levies and Collections – Last Ten Fiscal Years 140
Principal Property Tax Payers – Current Year and Ten Years Ago 141
Ratios of Net Bonded Debt– Last Ten Fiscal Years 142
Computation of Direct and Overlapping Debt 143
Legal Debt Margin Information – Last Ten Fiscal Years 144
Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General
Governmental Expenditures and Transfers – Last Ten Fiscal Years 145
Ratios of Outstanding Debt by Type – Last Ten Fiscal Years 146
Demographic and Economic Statistics – Last Ten Fiscal Years 147
Average Monthly Employment & Earnings – Last Ten Fiscal Years 148
Miscellaneous Statistical Data – Last Ten Fiscal Years 149
Property Value, Construction and Bank Deposits – Last Ten Fiscal Years 150
Full-Time Equivalent Borough Employees by Function/Program – Last Ten Fiscal Years 151
Operating Indicators by Function – Last Ten Fiscal Years 152
Capital Asset Statistics by Function/Program – Last Ten Fiscal Years 153
INTRODUCTORY SECTION
1
Kodiak Island Borough
Finance Department
710 Mill Bay Road Kodiak, Alaska 99615
December 20, 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,
2018.
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, 2018, 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, 2018. The independent
auditor’s report is presented as the first component of the financial section of this report.
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.
2
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 13,287.
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 30th. The assembly is required to hold public hearings on the proposed budget and to adopt
a final budget by no later than June 10th. The appropriated budget is prepared by fund and
department. 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.
3
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 guarded. The
main industries of the Borough are commercial fishing, and tourism. While the commercial fishing
industry in Kodiak has been stable with severance taxes on seafood ranging from $1,289,695 in
FY2009 to $1,660,842 in FY2018, there have been new federal and state environmental and quota
restrictions that may reduce future revenues. Tourism continues to be strong in Kodiak. Transient
accommodations tax (bed tax) revenues have increased from $86,338 in FY2009 to $109,297 in
FY2018, an increase of 26.59%, and cruise ship tax revenues have increased from $24,778 in 2009
to $37,625 in FY2018. 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.
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
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, 2018, the unemployment rate for the
Kodiak Island Borough was 5.1%.
4
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 3-5 years. 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, 2017. This was
the twenty-eighth 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
Electorate
Manager
Borough Attorney
Engineering/
Facilities Director
BVFD
Manager
Finance/MIS
Director
Borough Mayor
Borough Assembly
Community
Development
Director
Maintenance
Specialist
KFRC
Maintenance
Engineer
Solid Waste
Manager
Baler
Supervisor
Treatment Plant
Operator Lead
Senior Baler
Operator
Baler
Operator (4)
Assessing
Director
Planner (2)
Code Enforcement
Officer
Admin Support
Asst.
Lead Appraiser
Appraiser
Technician (2)
Admin
Support Asst.
Fiscal Analyst
Fiscal
Technician (2)
Fiscal Analyst
Admin Support
Asst.
IT
Administrator
IT Analyst
IT Analyst
Fiscal Asst.
Clerks Office
Director
Admin Support
Specialist (2)
Kodiak Island Borough
Fiscal Year 2018
Projects
Manager
Projects
Inspector
Maintenance
Administrator
Projects
Assistant
Management
Analyst (3)
Landfill
Attendant
Treatment Plant
Operator
Treatment Plant
Operator Trainee
Admin Support
Asst. (3)
IT Technician
MAYOR AND ASSEMBLY MEMBERS
7
Kyle Crow, Julie Kavanaugh,
At Large, 2018 At Large, 2020
Dan Rohrer, Mayor, 2019
Andrew Schroeder, Scott Smiley,
At Large, 2020 At Large, 2019
Dennis Symmons, Matt VanDaele,
At Large, 2018 At Large, 2019
Rebecca Skinner,
Deputy Presiding Officer (DPO),
At Large, 2020
8
KODIAK ISLAND BOROUGH
KODIAK, ALASKA
BOROUGH OFFICIALS
YEAR ENDED JUNE 30, 2018
MAYOR
Dan Rohrer ‘19
ASSEMBLY
Rebecca Skinner ’20 Kyle Crow ‘18
Julie Kavanaugh ’20 Andrew Schroeder ‘20
Scott Smiley ’19 Dennis Symmons ‘18
Matt VanDaele, ‘19
MANAGEMENT
Michael Powers .................................................................................................. Borough Manager
Dora Cross ............................................................................................... Finance Director/Treasurer
Nova Javier, MMC ...................................................................................................... Borough Clerk
Sara Fraser ................................................................................... Community Development Director
Bill Roberts ............................................................................................................Borough Assessor
Howard Rue ....................................................................................................................... Fire Chief
Vacant ......................................................................................... Engineering and Facilities Director
Paul Van Dyke .............................................................................................................. IT Supervisor
Levesque Law Group, LLC ...................................................... Borough Attorney (Contracted Firm)
9
FINANCIAL SECTION
10
3000 C Street N. Suite 201 Anchorage, Alaska 99503 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, 2018, 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.
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
11
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, the discretely
presented component unit, each major fund, and the aggregate remaining fund information of the Kodiak
Island Borough, as of June 30, 2018, 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.
Change in Accounting Principle
As discussed in Note 15 to the financial statements, in 2018 the Kodiak Island Borough adopted new
accounting guidance, GASB Statement No. 75, Accounting and Financial Reporting for Postemployment
Benefits Other Than Pensions. This statement replaces the requirements of Statements No. 45, Accounting
and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions, as amended,
and No. 57, OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans, for OPEB
Statement No. 74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans. Our
opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s
Discussion and Analysis, Budgetary Comparison Schedules and notes to RSI, and Schedules of Borough’s
Proportionate Share the of Net Pension and OPEB Liabilities and Contributions for the Public Employees’
Retirement System on pages 14-27, 84-88, and 89-92, 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.
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
12
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; 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 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.
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.
We also have previously audited, in accordance with auditing standards generally accepted in the United
States of America, the Kodiak Island Borough’s basic financial statements for the year ended June 30, 2017,
which are not presented with the accompanying financial statements and we expressed 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. That
audit was conducted for the purpose of forming opinions on the financial stateemtns that collectively
comprise Kodiak Island Borough’s basic financial statements as a whole. The individual fund financial
statements and schedules for the year ended June 30, 2017, 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, 2017, basic financial statements. The information has been subjected to the auditing
procedures applied in the audit of those 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 2017 individual fund financial statements and schedules are fairly stated in all
material respects in relation to the basic financial statements from which they have been derived.
The Honorable Mayor and Members of the Assembly
Kodiak Island Borough
13
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 20,
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 solely 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
December 20, 2018
MANAGEMENT’S DISCUSSION AND ANALYSIS
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis
June 30, 2018
14
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, 2018. 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 $181,338,761 (net
position). Of this amount, $56,260,313 (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 $2,505,584 (1.40%) including the cumulative effect of
a change in accounting principle. The governmental net position increased by $2,524,225 (1.95%)
and the business-type net position decreased by $18,641 (0.04%).
Total equity in the central treasury increased by $2,988,505 (4.04%). The governmental central
treasury increased by $1,615,652 (2.65%) and the business-type central treasury increased by
$1,372,853 (10.56%).
The Borough’s total noncurrent liabilities decreased by $7,732,339 (6.42%). Compensated leave, a
new line item, is $233,140, notes/bonds payable decreased by $7,456,063 (6.91%), net pension and
OPEB liabilities decreased by $830,416 (11.17%), and landfill closure costs increased by $331,000
(6.36%).
At the end of the current fiscal year, the Borough’s governmental funds reported combined fund
balances of $52,350,699. This was a decrease of $1,296,369 (2.42%), compared to the net change in
the prior year of a decrease of $2,328,562. Approximately 5.44% of the current year total amount,
$2,848,289, 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 $3,151,069.
This amounts to 52.53% of total General Fund expenditures.
The Borough adopted the provisions of GASB Statement No. 75, Accounting and Financial
Reporting for Postemployment Benefits Other than Pensions, during FY2018. Among other
accounting and reporting criteria, the Borough is required to recognize its proportional share of the
net other postemployment benefit plans (OPEB) liability. As a result of the implementation of this
statement, the change in accounting principle adjustment, as originally presented, is a decrease of
$1,310,015; a decrease of $1,045,654 for Governmental activities and a decrease of $264,361 for
Business-Type activities. See Note 15 for additional details.
OVERVIEW OF THE FINANCIAL STATEMENTS
The management discussion and analysis serves as an introduction to the Borough’s basic financial
statements, which contain the following: 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
15
1) Government-wide Financial Statements (pages 28-29)
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, community and economic development, emergency
preparedness, non-profit contributions for health and social services and education, culture and
recreation, service district maintenance, primary and secondary education, 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) facility, E911
emergency system, and long-term property leases for various Borough owned buildings including
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 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 inflows 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 distinguish 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 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.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
16
2) Fund Financial Statements (pages 30-37)
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 15 17
Capital Projects - 7 7
Total Governmental Funds 4 23 26
Proprietary Funds:
Enterprise Fund 5
Total of All Funds 31
a) Governmental Funds (pages 84-88 and 93-116) – 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 34-37 and 117-121) – 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 38-83)
The notes provide additional information that is essential to a full understanding of the data provided in the
government-wide and fund financial statements.
4) Required Supplementary Information (pages 84-92)
The required supplementary information (RSI) includes required budgetary supplementary information and
the schedules of the proportionate share of the net pension and OPEB liabilities and pension/OPEB
contributions.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
17
5) Other Supplementary Information (page 93-121)
The basic financial statements are followed by additional supplementary information on individual fund
activity.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Statement of Net Position (page 28)
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 $181,338,761 at June 30, 2018, compared to $178,833,177
at June 30, 2017.
The largest portion of the Kodiak Island Borough’s net position ($125,078,448 or 68.97%) 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
$56,260,313 of unrestricted net position may be used to meet the Borough’s ongoing obligations
to citizens and creditors.
0
50,000,000
100,000,000
150,000,000
200,000,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Total Net Position of Government and Business-Type
Activities
Business Type Activities Governmental Activites
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
18
Governmental Business-type Total
Activities Activities Activities
2018 2017 2018 2017 2018 2017
Current and other assets $ 64,518 63,648 18,092 17,027 82,610 80,675
Capital assets 163,318 163,160 68,965 71,113 232,283 234,273
Total assets 227,836 226,808 87,057 88,140 314,893 314,948
Deferred outflows of resources 661 1,295 176 336 837 1,631
Total assets and deferred
outflows of resources $ 228,497 228,103 87,233 88,476 315,730 316,579
Long-term liabilities $ 78,023 83,734 34,777 36,797 112,800 120,531
Other liabilities 17,892 15,151 2,563 1,981 20,455 17,132
Total liabilities 95,915 98,885 37,340 38,778 20,455 137,663
Deferred inflows of resources 907 67 229 16 1,136 83
Total liabilities and deferred
inflows of resources $ 96,822 98,952 37,569 38,794 21,591 137,746
Net position:
Net investment in capital assets $ 85,570 80,857 39,509 40,098 125,079 120,955
Unrestricted 46,105 48,294 10,155 9,584 56,260 57,878
Total net position $131,675 129,151 49,664 49,682 181,339 178,833
Net Position of Governmental and Buisness-type Activities (in thousands)
For Years Ended June 30, 2018 and 2017
Changes in Net Position
During the current fiscal year, the Borough’s total net position increased by $2,505,584 (1.4%). This
compares to an increase of $886,949 for the year ended June 30, 2017. Of the $2,505,584 increase, the
governmental net position increased by $2,524,225 (1.95%) and the business-type net position decreased
by $18,641 (0.04%).
Revenues increased overall by $1,094,295 (3.09%). The largest increase is Operating grants and
contributions at $1,403,902 (33.0%) and the largest revenue decrease is Capital grants at $788,795 (89.1%).
Expenses decreased overall by $1,872,864 (5.41%) The largest increase is Service District Maintenance at
$112,459 (23.6%) and the largest decrease is Primary and secondary education at $1,467,635 (10.36%).
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
19
Statement of Activities (page 29)
The following table shows the changes in net position for fiscal years 2018 and 2017 for both governmental
and business type activities.
2018 2017 2018 2017 2018 2017
Revenues:
Program revenues:
Charges for services $ 979 3,001 7,118 5,733 8,097 8,734
Operating grants and contributions 5,614 4,227 45 28 5,659 4,255
Capital grants 97 885 — — 97 885
General revenues:
Property taxes 16,045 15,714 — — 16,045 15,714
Grants and entitlements not restricted
to specific programs 3,415 3,631 — — 3,415 3,631
Land sales 28 326 — — 28 326
Excise taxes 310 — — — 310 —
Severance taxes 1,929 1,415 — — 1,929 1,415
Other 306 23 312 116 618 139
Loss on advanced refunding of debt — — — (55) — (55)
Investment earnings 282 272 70 178 352 450
Total revenues 29,005 29,494 7,545 6,000 36,550 35,494
Expenses:
General government 6,995 7,156 — — 6,995 7,156
Public safety 954 1,028 — — 954 1,028
Community and economic development 1,152 1,136 — — 1,152 1,136
Emergency preparedness 43 36 — — 43 36
Health and social services 208 234 — — 208 234
Education, culture and recreation 5 18 — — 5 18
Parks and recreation 77 30 — — 77 30
Service district maintenance 588 475 — — 588 475
Primary and secondary education 12,695 14,163 — — 12,695 14,163
Interest on long-term debt 2,673 3,061 — — 2,673 3,061
Municipal solid waste collection and
disposal — — 3,246 3,297 3,246 3,297
Hospital facilities — — 1,412 1,285 1,412 1,285
Long Term Care Center — — 1,008 1,128 1,008
Kodiak Fisheries Research Center — — 1,422 1,532 1,422 1,532
911 services — — 256 28 256 28
Total expenses 25,390 27,337 7,344 7,270 32,734 33,479
Change in net position
before transfers 3,615 2,157 201 (1,270) 3,816 887
Transfers (45) (1,134) 45 1,134 — —
Change in net position 3,570 1,023 246 (136) 3,816 887
Net position, beginning of year,
as previously stated 129,151 128,128 49,682 49,818 178,833 177,946
Cummulative effect of a change in
accounting principle (1,046) — (264) — (1,310) —
Net position, beginning of year,
as restated 128,105 128,128 49,418 49,818 177,523 177,946
Net position, end of year $ 131,675 129,151 49,664 49,682 181,339 178,833
Governmental activities Business-type activities Total activities
Changes in Net Position (in thousands)
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
20
Governmental Activities – increased the Borough’s net position by $2,524,225.
The largest source of revenue from governmental activities is property taxes, which amounted to
$16,045,148, a 2.1% increase from 2017. Operating grants and contributions was the largest increasing
revenue by $1,387,172 (32.82%) and Capital grants was the largest decreasing revenue by $788,795
(89.1%). Excise taxes, a new revenue for 2018, was $310,482. Overall, total revenues decreased by
$488,849 (1.66%) from 2017.
The largest expense from governmental activities is from Primary and Secondary Education, which
amounted to $12,695,233, a 10.36% decrease from 2017. General government was the second largest
decreasing expense at $463,557 (6.48%). Service district maintenance and parks and recreation are the two
largest increases in expenses at $112,459 (22.66%) and $47,014 (155.82%), respectively. Overall, total
expenses decreased by $1,946,574 (7.12%) from 2017.
Charges for services
3%
Operating grants and
contributions
19%
Property taxes
56%
Grants and
entitlements not
restricted to specific
programs
12%
Excise taxes
1%
Severance taxes
7%Investment earnings
1%
Other
1%
FY2018 Governmental Activities - Revenue Sources
General government
26%
Public safety
5%
Community and
economic
development
5%
Health and social
services
1%
Service district
maintenance
2%
Primary and
secondary education
50%
Interest on long-term
debt
11%
FY2018 Governmental Activities - Functional Expenses
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
21
Business Activities - decreased the Kodiak Island Borough’s net position by $18,641.
The largest source, and increase, in revenue from business-type activities is charges for services, which
amounted to $7,117,737, a 24.15% increase from 2017. The largest decrease in revenues is interest earnings
at $107,980 (60.71%). Overall, total revenues increased by $1,544,635 (25.75%) from 2017.
The largest expense from business-type activities is from Municipal Solid Waste Collection and Disposal,
which totaled $3,245,526, a 1.56% decrease from 2017. The largest increase in expenses was 911 services
at $227,208 (799.77%) and the largest decrease in expenses is the long-term care center at $120,027
(10.64%). Overall, total expenses increased by $73,710 (1.01%) from 2017.
Personnel services
22%
Contracted services
6%
Maintenance and
repair
2%
Depreciation
39%
General
Administration
21%
Recycling services
4%
Closure/post closure
6%
FY2018 Business-Type Activities - Expenses
Charges for Services
94%
Operating grants and
contributions
1%
Interest Earnings
1%
Other
4%
FY2018 Business-Type Activities - Revenue Sources
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
22
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. Unassigned 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 $52,350,699, a decrease of $1,296,369 (2.42%) in comparison to the beginning of the year.
$37,889 of this total amount constitutes nonspendable fund balances, $43,876,363 is committed fund
balances, $5,588,158 is assigned fund balances and $2,848,289 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 $37,885, with an unassigned fund balance of
$3,151,069 for a total fund balance of $3,188,954. As a measure of the General Fund’s liquidity, it may be
useful to compare fund balance to total expenditures. Unassigned fund balance represents 52.53% of total
General Fund expenditures.
Major Fund Highlights
General Fund – Fund balance increased by $871,830 (37.63%) during the current fiscal year. A
non-recurring revenue of $492,936 is from the Debt Service fund and a new excise tax revenue of
$310,482 contributed to the overall increase to the fund balance.
Education Support (Special Revenue Fund) – Fund balance deficit increased by $58,574 (86.09%)
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) – Fund balance increased by $73,220 (0.19%) during the
current fiscal year. The largest use of allowed earning use in this fund was a transfer of $65,105 to
the Debt Service Fund to help cover required debt service payments.
Education Debt Service Fund – Fund balance decreased by $27,792 (11.83%), largely due to a
$492,936 repayment to the General Fund.
$3,188,954
$(126,614)
$39,371,219
$207,204 $9,709,936
(20,000,000)
0
20,000,000
40,000,000
60,000,000
General Education Facilities Debt Service Non-Major Funds
GOVERNMENTAL FUNDS - FUND BALANCE
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
23
Other Governmental Funds (Non-Major Funds) Highlights
Other Governmental funds – Aggregate fund balance decreased by $2,155,053 (18.16%) during
the current fiscal year; special revenue funds decreased $623,373 and capital projects funds
decreased $1,531,680.
Fire Protection Area No. 1 (Special Revenue Fund) – Fund balance decreased by $926,462
primarily due to the purchase of capital assets.
Land Sales (Special Revenue Fund) – Fund balance decreased $94,210. The Borough did not sell
property or timber this year. Although this fund’s regular annual revenue streams are not enough
to fund regular annual expenses, the infrequent sales of land and timber resources provide a fund
balance for these non-revenue years.
Building and Grounds (Special Revenue Fund) – Fund balance increased $310,534. The key
factors leading to this was an increase in building lease income and a reduction in transfers out.
Kodiak High School Renovation (Capital Project Fund) – Fund balance decreased by $615,212 due
the project nearing completion.
Renewal and Replacement Projects (Capital Project Fund) – Fund balance increased by $1,444,643
primarily due to a mill rate increase to the fund. Fund balance will continue to increase due to future
planned projects.
Other Capital Projects (Capital Project Fund) – Fund balance increased by $479,137 primarily due
to timing of revenues and project expenses.
School Renewal and Replacement Facilities Bond Projects (Capital Projects Fund) – Fund balance
decreased by $2,850,791. The key factor leading to this decrease is the completion of projects.
Fire Protection
Area No 1
9%
Womens Bay Fire Dept.
27%
Kodiak Airport Fire
District
2%
Monashka Bay Road
Service
8%
Service Area No 1
32%
Womens Bay Road
Service
5%
Bay View Road Service
2%
Woodland Acres Street
Light
1%
Trinity Island
Street Light
1%
Tourism Development
10%
Mission Lake Tide Gate
3%
GOVERNMENTAL FUNDS (NON-MAJOR FUNDS SPECIAL
REVENUE) - FUND BALANCES
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
24
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
$4,966,803, a $18,641 (0.04%) decrease in comparison to the beginning of the year. However, equity in
central treasury and restricted cash and equivalents increased by $1,372,774 (9.61%) in comparison to the
beginning of the year.
Major Fund Highlights
Municipal Solid Waste Collection and Disposal (Enterprise fund) – Net position increased by
$637,189 (4.27%) due to an increase in charges for services and a decrease in interest expenses.
Hospital Facilities (Enterprise Fund) – Net position decreased by $4,028 (0.03%).
Long-Term Care Center (Enterprise Fund) – Net position increased by $88,196 due to timing
differences in revenues and bond payments.
Kodiak Fisheries Research Center (Enterprise Fund) – Net position decreased by $475,637
(3.89%) due to decreasing lease revenues and operating expenses exceeding revenues.
Other Nonmajor Fund Highlights
911 Services (Enterprise Fund) – Since the revenues to this fund are passed through to the City of
Kodiak, the net position at year end is $0. However, it should be noted that the City increased the
per line fee from $0.75 per land line to $2.00 for land lines and cellular phones. Therefore, the
revenue from this fund increased by $227,208 (799.77%).
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
Municipal
Solid
Waste
Hospital
Facilities
Long-Term
Care
Center
Kodiak
Fisheries
Research
Center
911
Service
2018 Operating Revenues versus
Operating Expenses
Operating Revenues
Operating Expenses
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
25
GENERAL FUND BUDGETARY HIGHLIGHTS (pages 84-85)
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 revenues was PERS
on-behalf receiving $12,681 less and Federal PILT (Payment in Lieu of Taxes) receiving $290,466 more
than budgeted. Overall, actual revenues were $719,771 (12.09%) more than budgeted.
Within the General fund expenditures, the largest difference between budgeted and actual expenses was the
general administration department expending $146,525 less and the engineering department expending
$134,130 more than budgeted. Overall, actual expenditures were $444,295 (6.89%) less than budgeted.
0
500,000
1,000,000
1,500,000
2,000,000
Property Taxes Severance
Taxes
Excise Tax State Sources Federal
Sources
Other
FY18 Budget to Actual Comparison of Revenues
Budgeted Actual
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
General
Government
Public Safety Community &
Economic
Development
Emergency
Preparedness
Non-Profit -
Social Services,
Education &
Recreation
Parks and
Recreation
FY18 Budget to Actual Comparison of Expenditures
Budgeted
Actual
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
26
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets (Note 8 on page 53-58) – 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, 2018, the total net book value was $232,283,824. The
$1,988,832 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, 2018 with a
comparison to 2017.
2018 2017 2018 2017 2018 2017
Artwork $ — — 16,091 16,091 16,091 16,091
Land 23,495,458 23,852,758 1,661,499 1,661,499 25,156,957 25,514,257
Construction work-in-progress 86,335,806 86,867,058 28,897,659 28,448,177 115,233,465 115,315,235
Buildings and improvements 38,853,891 39,605,633 34,414,872 36,599,907 73,268,763 76,205,540
Improvements other than
buildings 12,428,055 11,294,569 2,798,575 3,088,939 15,226,630 14,383,508
Equipment 1,711,415 970,611 377,958 456,891 2,089,373 1,427,502
Infrastructure 493,498 569,421 — — 493,498 569,421
Unclassified plant in service — — 799,047 841,102 799,047 841,102
$ 163,318,123 163,160,050 68,965,701 71,112,606 232,283,824 234,272,656
Governmental
activities
Business-type
activities activities
Total
Long-Term Debt (Note 10, pages 60-64) – At the end of the current fiscal year, the Borough had total
bonded debt outstanding of $70,210,000. 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, 2018, with a comparison to 2017.
Governmental Business-type
activities activities
2018 2017 2018 2017 2018 2017
General obligation bonds, including premium $ 77,748,492 82,302,899 — — 77,748,492 82,302,899
Compensated absences 219,481 242,398 — — 219,481 242,398
Landfill post closure care costs — — 5,535,000 5,204,000 5,535,000 5,204,000
Notes payable — — 18,129,817 19,139,725 18,129,817 19,139,725
Revenue Bonds Payable — — 11,327,067 11,874,871 11,327,067 11,874,871
$ 77,967,973 82,545,297 23,664,817 24,343,725 112,959,857 118,763,893
Total
Activities
The Borough’s total debt decreased by $5,804,036 (4.89%) during the current fiscal year. This decrease
can be attributed to regularly scheduled bond payments. During 2017, the Borough refunded one of the
general obligation bonds which will result in interest expense savings over 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.
KODIAK ISLAND BOROUGH
Management’s Discussion and Analysis, Continued
27
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 2017 unemployment rate was 5.1% compared to 7.2% 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.
o March 2018, the USCG (United States Coast Guard) announced the upgrade of five of its
Kodiak based multipurpose airplanes over the next two years.
o April 2018, the USCG announced the addition of two new Kodiak based cutters for search
and rescue, fisheries enforcement and security.
o June 2018, the USCG announced the addition of 100 service members to the Kodiak
Coast Guard Base over the next six years.
Next Year’s Budgets and Rates:
No change to the Area-wide mill rate.
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 2019.
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 2018 2017
Equity in central treasury $ 62,663,220 14,369,530 77,032,750 — 77,032,750 74,044,245
Due from primary
government — — — 9,397,741 9,397,741 7,785,248
Receivables:
State of Alaska 128,089 — 128,089 3,144,654 3,272,743 2,274,331
Federal government 231,570 — 231,570 — 231,570 280,005
Property taxes, net of
allowance of $15,789 427,086 — 427,086 — 427,086 316,132
Severance taxes 288,482 — 288,482 — 288,482 376,432
Excise taxes 122,130 — 122,130 — 122,130
Interest 300,209 — 300,209 — 300,209 192,190
Land sales contracts
receivable 187,845 — 187,845 — 187,845 384,792
Accounts and other
receivables, net 132,017 540,492 672,509 — 672,509 915,797
Current portion of
notes receivable — 118,194 118,194 — 118,194 114,135
Inventories — 380,038 380,038 467,094 847,132 1,182,462
Prepaid items 37,889 — 37,889 — 37,889 451,561
Restricted cash and equivalents — 1,285,575 1,285,575 — 1,285,575 1,285,654
Notes receivable — 1,397,207 1,397,207 — 1,397,207 1,515,401
Capital assets:
Non-depreciable 109,831,264 30,575,249 140,406,513 — 140,406,513 140,845,583
Depreciable, net 53,486,859 38,390,452 91,877,311 882,429 92,759,740 94,303,839
Total assets 227,836,660 87,056,737 314,893,397 13,891,918 328,785,315 326,267,807
Deferred outflows of resources -
Pension and OPEB deferrals 660,787 176,079 836,866 3,281,554 4,118,420 8,740,961
Total assets and deferred
outflows of resources $228,497,447 87,232,816 315,730,263 17,173,472 332,903,735 335,008,768
Liabilities:
Accounts payable $1,862,275 414,591 2,276,866 1,038,646 3,315,512 2,470,526
Accrued compensation
and related liabilities 366,972 — 366,972 2,991,196 3,358,168 3,774,675
Other accrued liabilities 1,105,617 132,421 1,238,038 691,681 1,929,719 1,615,822
Customer deposits 2,450 60,468 62,918 — 62,918 77,418
Unearned revenues 33,161 202,325 235,486 279,173 514,659 348,007
Due to component unit 9,397,741 — 9,397,741 — 9,397,741 7,785,248
Internal balances (71,072) 71,072 — — — —
Noncurrent liabilities:
Due within one year:
Accrued leave 86,041 23,990 110,031 — 110,031 242,398
Notes payable 5,109,407 1,659,087 6,768,494 21,555 6,790,049 5,215,853
Due in more than one year:
Accrued leave 133,440 89,700 223,140 — 223,140 —
Notes payable 72,639,085 27,797,797 100,436,882 798,016 101,234,898 108,669,803
Net pension and OPEB liabilities 5,250,303 1,353,775 6,604,078 29,524,048 36,128,126 40,895,548
Landfill closure costs — 5,535,000 5,535,000 — 5,535,000 5,204,000
Total liabilities 95,915,420 37,340,226 133,255,646 35,344,315 168,599,961 176,299,298
Deferred inflows of resources -
Pension and OPEB deferrals 907,069 228,787 1,135,856 4,402,324 5,538,180 717,563
Net position:
Net investment in capital assets 85,569,631 39,508,817 125,078,448 789,539 125,867,987 121,798,226
Unrestricted 46,105,327 10,154,986 56,260,313 (23,362,706) 32,897,607 36,193,681
Total net position 131,674,958 49,663,803 181,338,761 (22,573,167) 158,765,594 157,991,907
Total liabilities, deferred inflows
of resources and net position $ 228,497,447 87,232,816 315,730,263 17,173,472 332,903,735 335,008,768
See accompanying notes to financial statements.
(With summarized financial information for June 30, 2017)
June 30, 2018
Statement of Net Position
KODIAK ISLAND BOROUGH
of Resources and Net Position
Liabilities, Deferred Inflows
Outflows of Resources
Assets and Deferred
28
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 2018 2017
Primary government:
Governmental activities:
General government $6,995,624 873,043 141,863 96,698 (5,884,020) — (5,884,020) — (5,884,020) (3,429,466)
Public safety 953,898 15,366 182,075 — (756,457) — (756,457) — (756,457) (1,004,569)
Community and economic development 1,152,197 — 67,232 — (1,084,965) — (1,084,965) — (1,084,965) (1,086,888)
Emergency preparedness 43,038 — — — (43,038) — (43,038) — (43,038) (22,105)
Health and social services 207,500 — — — (207,500) — (207,500) — (207,500) (233,999)
Education, culture and recreation 4,665 — — — (4,665) — (4,665) — (4,665) (17,562)
Parks and recreation 77,186 — — — (77,186) — (77,186) — (77,186) 3,217
Service district maintenance 587,707 90,450 — — (497,257) — (497,257) — (497,257) (364,102)
Primary and secondary education 12,695,233 — 237,895 — (12,457,338) — (12,457,338) — (12,457,338) (13,848,567)
Interest on long-term debt 2,673,238 — 4,985,040 — 2,311,802 — 2,311,802 — 2,311,802 780,243
Total governmental activities 25,390,286 978,859 5,614,105 96,698 (18,700,624) — (18,700,624) — (18,700,624) (19,223,798)
Business-type activities:
Municipal solid waste collection and
disposal 3,245,526 3,813,343 35,503 — — 603,320 603,320 — 603,320 (170,370)
Hospital facilities 1,412,150 1,384,272 — — — (27,878) (27,878) — (27,878) (624,657)
Long Term Care Center 1,008,032 1,093,475 — — — 85,443 85,443 — 85,443 (62,720)
Kodiak Fisheries Research Center 1,422,337 826,647 9,006 — — (586,684) (586,684) — (586,684) (677,456)
911 service 255,617 — — — — (255,617) (255,617) — (255,617) (28,409)
Total business-type activities 7,343,662 7,117,737 44,509 — — (181,416) (181,416) — (181,416) (1,563,612)
Total primary government 32,733,948 8,096,596 5,658,614 96,698 (18,700,624) (181,416) (18,882,040) — (18,882,040) (20,787,410)
Component unit:
School District $48,861,120 190,716 8,830,324 7,388 (39,832,692) (39,832,692) (51,073,100)
General revenues:
Property taxes 16,045,148 — 16,045,148 — 16,045,148 15,714,593
Grants and entitlements not restricted to specific programs 3,414,671 — 3,414,671 33,245,974 36,660,645 36,020,458
Land sales 27,955 — 27,955 — 27,955 325,793
Tobacco excise taxes 310,482 — 310,482 — 310,482 —
Severance taxes 1,929,409 — 1,929,409 — 1,929,409 1,414,557
Support from primary government — — — 9,377,500 9,377,500 10,277,500
Investment earnings 281,855 69,871 351,726 — 351,726 449,542
Other 305,983 312,265 618,248 154,651 772,899 253,114
Transfers (45,000) 45,000 — — — —
Total general revenues and transfers 22,270,503 427,136 22,697,639 42,778,125 65,475,764 64,455,557
Change in net position 3,569,879 245,720 3,815,599 2,945,433 6,761,032 (7,404,953)
Net position, at beginning of year, as previously stated 129,150,733 49,682,444 178,833,177 (20,841,270) 157,991,907 165,396,860
Cumulative effect of a change in accounting
principle (1,045,654) (264,361) (1,310,015) (4,677,330) (5,987,345) —
Net position, at beginning of year, as restated 128,105,079 49,418,083 177,523,162 (25,518,600) 152,004,562 165,396,860
Net position, at end of year $131,674,958 49,663,803 181,338,761 (22,573,167) 158,765,594 157,991,907
See accompanying notes to financial statements.
KODIAK ISLAND BOROUGH
Statement of Activities
Year ended June 30, 2018
(With summarized financial information for the year ended June 30, 2017)
29
Education Other
Education Debt Service Governmental
Assets General Support Facilities Fund Funds 2018 2017
Assets:
Equity in central treasury $ 2,458,718 8,982,385 39,371,219 97,764 11,753,134 62,663,220 61,047,568
Receivables:
State of Alaska 17,321 49,643 — 49,849 11,276 128,089 482,993
Federal government — — — — 231,570 231,570 280,005
Property taxes, net of
allowance of $15,789 54,388 239,099 — 62,741 70,858 427,086 316,132
Severance taxes 288,482 — — — — 288,482 376,432
Excise taxes 122,130 — — — — 122,130 —
Interest 300,209 — — — — 300,209 192,190
Land sales contracts — — — — 17,970 17,970 24,135
Accounts and other
receivables, net 30,370 — — — 101,647 132,017 116,487
Prepaid items 37,885 — — — 4 37,889 451,561
Due from other funds 780,305 — — — — 780,305 995,538
Land sales contracts, due after one year — — — — 169,875 169,875 360,657
Total assets $ 4,089,808 9,271,127 39,371,219 210,354 12,356,334 65,298,842 64,643,698
Liabilities:
Accounts payable 145,416 — — 3,150 1,713,709 1,862,275 1,156,393
Accrued compensation
and related liabilities 366,972 — — — — 366,972 270,833
Customer deposits — — — — 2,450 2,450 27,450
Due to component unit — 9,397,741 — — — 9,397,741 7,785,248
Due to other funds — — — — 709,233 709,233 995,538
Unearned revenues — — — — 33,161 33,161 30,930
Total liabilities 512,388 9,397,741 — 3,150 2,458,553 12,371,832 10,266,392
Deferred inflows of resources:
Unavailable revenues 388,466 — — — 187,845 576,311 730,238
Total liabilities and deferred
inflows of resources 900,854 9,397,741 — 3,150 2,646,398 12,948,143 10,996,630
Fund balances (deficit):
Nonspendable 37,885 — — — 4 37,889 451,561
Committed — — 39,371,219 207,204 4,297,940 43,876,363 44,035,100
Assigned — — — — 5,588,158 5,588,158 7,066,350
Unassigned 3,151,069 (126,614) — — (176,166) 2,848,289 2,094,057
Total fund balances (deficit) 3,188,954 (126,614) 39,371,219 207,204 9,709,936 52,350,699 53,647,068
Total liabilities, deferred inflows
of resources and fund balances $ 4,089,808 9,271,127 39,371,219 210,354 12,356,334 65,298,842 64,643,698
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, 2017)
June 30, 2018
Balance Sheet
30
Amount reported as fund balances on the governmental funds balance sheet $ 52,350,699
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.163,318,123
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 $388,466
Notes receivable - land sales 187,845 576,311
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 (70,210,000)
Bond premium (7,538,492)
Accrued interest expense (1,105,617)
Compensated absences (219,481) (79,073,590)
Changes in deferred inflows and outflows of resources are the results
of timing differences in the acturial reports:
Pension and OPEB related assets in the current fiscal year are
presented as deferred outflows of resources 660,787
Pension and OPEB related liabilities in the current fiscal year are
presented as deferred inflows of resources (907,069)
Proportionate share of the collective net pension and OPEB liabilities (5,250,303)
Net position of governmental activities $ 131,674,958
See accompanying notes to financial statements.
KODIAK ISLAND BOROUGH
Reconciliation of Net Position Between the
June 30, 2018
Government-Wide Financial Statements and the Fund Financial Statements
31
Education Other
Education Debt Service Governmental
General Support Facilities Fund Funds 2018 2017
Revenues:
Property taxes and assessments $1,071,739 9,081,031 — 2,711,114 3,138,244 16,002,128 15,700,272
Transient accomodations tax — — — — 113,486 113,486 108,050
Severance taxes 1,815,923 — — — — 1,815,923 1,306,507
Intergovernmental:
State sources 1,688,433 237,895 — 4,985,040 64,105 6,975,473 6,134,338
Federal sources 1,813,439 — — — 253,674 2,067,113 2,628,537
Charges for services 2,064 — — — 876,635 878,699 791,786
Licenses, permits and fees 62,350 — — — 37,310 99,660 2,208,870
Tobacco excise tax 310,482 — — — — 310,482 —
Investment income (loss)10,830 — 203,430 (1,746) 69,341 281,855 271,691
Rental — — — — 14,400 14,400 14,160
Other 4,650 — — — 285,693 290,343 9,146
Total revenues 6,779,910 9,318,926 203,430 7,694,408 4,852,888 28,849,562 29,173,357
Expenditures:
Current:
General government 4,399,266 — — 16,059 1,300,621 5,715,946 5,281,999
Public safety 114,015 — — — 684,499 798,514 699,118
Community and
economic development 1,080,628 — — — 96,570 1,177,198 1,096,928
Emergency preparedness 43,038 — — — — 43,038 35,861
Health and social services 207,500 — — — — 207,500 233,999
Education, culture
and recreation 4,665 — — — — 4,665 17,562
Parks and recreation 77,186 — — — — 77,186 30,172
Service district maintenance — — — — 587,707 587,707 475,248
Primary and secondary education 72,000 9,377,500 — — — 9,449,500 10,373,548
Capital outlay:
Schools — — — — 2,958,053 2,958,053 3,936,147
General — — — — 2,029,456 2,029,456 1,086,817
Debt service:
Principal — — — 3,870,000 — 3,870,000 3,530,000
Payment to refunding escrow — — — — — — 5,934,301
Interest — — — 3,408,310 — 3,408,310 3,568,559
Debt issuance costs — — — — — — 64,313
Total expenditures 5,998,298 9,377,500 — 7,294,369 7,656,906 30,327,073 36,364,572
Excess (deficiency) of revenues
over expenditures 781,612 (58,574) 203,430 400,039 (2,804,018) (1,477,511) (7,191,215)
Other financing sources (uses):
Bond issuance — — — — — — 4,905,000
Premium on bonds issued — — — — — — 806,205
Land sale proceeds — — — — 224,902 224,902 145,820
Proceeds from sale of capital assets 1,240 — — — — 1,240 140,000
Transfers in 492,936 — — 65,105 631,063 1,189,104 1,758,036
Transfers out (403,958) — (130,210) (492,936) (207,000) (1,234,104) (2,892,408)
Net other financing
sources (uses)90,218 — (130,210) (427,831) 648,965 181,142 4,862,653
Change in fund balances 871,830 (58,574) 73,220 (27,792) (2,155,053) (1,296,369) (2,328,562)
Fund balances (deficit),
at beginning of year 2,317,124 (68,040) 39,297,999 234,996 11,864,989 53,647,068 55,975,630
Fund balances (deficit), at end of year $ 3,188,954 (126,614) 39,371,219 207,204 9,709,936 52,350,699 53,647,068
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, 2018
(With summarized financial information for the year ended June 30, 2017)
32
Change in fund balances – total governmental funds $ (1,296,369)
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 $4,410,701
Depreciation expense (3,827,499) 583,202
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 (506,172)
Accumulated depreciation of assets disposed 81,043 (425,129)
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 388,466
Land sale proceeds 187,845 576,311
Certain revenues that were earned in a prior year provide
current financial resources:
Accrued property tax (345,446)
Land sale contracts (384,792) (730,238)
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 50,665
Principal repayments 3,870,000
Bond premium amortization 684,407 4,605,072
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 22,917
Change in the proportionate share of the unfunded
net pension and OPEB liabilities 1,877,467
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 net pension and OPEB liabilities.(1,643,354)
Change in net position of governmental activities $
3,569,879
See accompanying notes to financial statements.
of Governmental Funds to the Statement of Activities
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances (Deficit)
KODIAK ISLAND BOROUGH
Year ended June 30, 2018
33
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2018 2017
Current assets:
Equity in central treasury $7,255,175 2,520,689 2,366,056 2,100,505 127,105 14,369,530 12,996,677
Restricted cash and equivalents 302,500 — 983,075 — — 1,285,575 1,285,654
Customer receivables 403,266 — — 100,192 37,034 540,492 421,349
Current portion of note receivable — — — 118,194 — 118,194 114,135
Total current assets 7,960,941 2,520,689 3,349,131 2,318,891 164,139 16,313,791 14,817,815
Inventories 380,038 — — — — 380,038 693,747
Capital assets:
Non-depreciable 30,230,879 30,284 — 314,086 — 30,575,249 30,125,767
Depreciable, net 2,215,143 13,556,884 14,486,876 8,131,549 — 38,390,452 40,986,839
Total capital assets 32,446,022 13,587,168 14,486,876 8,445,635 — 68,965,701 71,112,606
Note receivable — — — 1,397,207 — 1,397,207 1,515,401
Total noncurrent assets 32,826,060 13,587,168 14,486,876 9,842,842 — 70,742,946 73,321,754
Pension and OPEB deferrals 119,258 — — 56,821 — 176,079 336,338
Total assets and deferred
outflows of resources $40,906,259 16,107,857 17,836,007 12,218,554 164,139 87,232,816 88,475,907
Current liabilities:
Accounts payable $195,376 22,877 — 32,199 164,139 414,591 272,669
Customer deposits 60,468 — — — — 60,468 49,968
Current portion of accrued
compensation and related liabilities 18,932 — — 5,058 — 23,990 99,766
Unearned revenue — 115,356 86,969 — — 202,325 155,277
Interest payable 94,333 — 38,088 — — 132,421 459,540
Current portion of notes and bonds payable 1,101,283 — 557,804 — — 1,659,087 943,438
Due to other funds 56,085 969 — 14,018 — 71,072 —
Total current liabilities 1,526,477 139,202 682,861 51,275 164,139 2,563,954 1,980,658
Noncurrent liabilities:
Accrued compensation and
related liabilities 77,188 — — 12,512 — 89,700 —
Notes payable 17,028,534 — 10,769,263 — — 27,797,797 30,071,158
Accrual for landfill closure
and postclosure costs 5,535,000 — — — — 5,535,000 5,204,000
Net pension and OPEB liabilities 988,128 — — 365,647 — 1,353,775 1,521,353
Total noncurrent liabilities 23,628,850 — 10,769,263 378,159 — 34,776,272 36,796,511
Total liabilities 25,155,327 139,202 11,452,124 429,434 164,139 37,340,226 38,777,169
Deferred inflows of resources -
Pension and OPEB deferrals 182,772 — — 46,015 — 228,787 16,294
Net position:
Net investment in capital assets 14,316,205 13,587,168 3,159,809 8,445,635 — 39,508,817 40,098,010
Restricted for capital projects — — — — — — —
Unrestricted 1,251,955 2,381,487 3,224,074 3,297,470 — 10,154,986 9,584,434
Total net position 15,568,160 15,968,655 6,383,883 11,743,105 — 49,663,803 49,682,444
Total liabilities, deferred inflows
of resources and net position $ 40,906,259 16,107,857 17,836,007 12,218,554 164,139 87,232,816 88,475,907
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, 2017)
June 30, 2018
Outflows of Resources
Assets and Deferred
Liabilities, Deferred Inflows
34
KODIAK ISLAND BOROUGH
Statement of Revenues, Expenses, and Changes in Net Position
Year ended June 30, 2018
(With summarized financial information for the year ended June 30, 2017)
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2018 2017
Operating revenues:
Charges for services:
Solid waste disposal $3,813,343 — — — — 3,813,343 3,105,560
Lease income — 1,384,272 1,093,475 826,647 — 3,304,394 2,627,571
Other 1,434 — — — 255,617 257,051 56,422
Total operating revenues 3,814,777 1,384,272 1,093,475 826,647 255,617 7,374,788 5,789,553
Operating expenses:
Personnel services 1,117,408 34,000 — 294,919 1,500 1,447,827 1,749,781
Contracted services 299,815 — — — — 299,815 303,846
Maintenance and repairs 101,429 — — 56,037 — 157,466 163,927
Depreciation 293,749 1,085,223 518,933 698,482 — 2,596,387 2,637,170
General and administration 450,051 22,818 16,040 363,593 — 852,502 897,305
Miscellaneous — 270,109 — 9,306 133 279,548 7,582
Telephone services — — — — 253,984 253,984 26,856
Recycling services 259,824 — — — — 259,824 252,960
Closure and postclosure costs 367,702 — — — — 367,702 154,010
Contributions 36,383 — — — — 36,383 35,880
Total operating expenses 2,926,361 1,412,150 534,973 1,422,337 255,617 6,551,438 6,229,317
Operating income (loss) 888,416 (27,878) 558,502 (595,690) — 823,350 (439,764)
Nonoperating revenues (expense):
Intergovernmental:
State of Alaska on-behalf payment 35,503 — — 9,006 — 44,509 27,799
Contribution to Providence Hospital — — — — — — (108,000)
Investment income 32,435 23,850 2,753 10,833 — 69,871 177,851
Debt issuance costs — — — — — — (11,500)
Loss on advanced refunding of debt — — — — — — (54,590)
Interest revenue — — — 55,214 55,214 59,134
Interest expense (319,165) — (473,059) — — (792,224) (921,135)
Total nonoperating income (expense) (251,227) 23,850 (470,306) 75,053 — (622,630) (830,441)
Income (loss) before transfers 637,189 (4,028) 88,196 (520,637) — 200,720 (1,270,205)
Transfers in — — — 45,000 — 45,000 9,197,194
Transfers out — — — — — — (8,062,822)
Total transfers — — — 45,000 — 45,000 1,134,372
Change in net position 637,189 (4,028) 88,196 (475,637) — 245,720 (135,833)
Net position, at beginning of year,
as previously stated 15,143,324 15,972,683 6,295,687 12,270,750 — 49,682,444 49,818,277
Cumulative effect of a change in
accounting principle (212,353) — — (52,008) — (264,361) —
Net position, at beginning of year, as restated 14,930,971 15,972,683 6,295,687 12,218,742 — 49,418,083 49,818,277
Net position, at end of year $15,568,160 15,968,655 6,383,883 11,743,105 — 49,663,803 49,682,444
See accompanying notes to financial statements.
Proprietary Funds - Business - Type Activities - Enterprise Funds
35
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor
Collection and Hospital Long Term Research Enterprise Totals
Disposal Facilities Care Center Center Fund 2018 2017
Cash flows provided (used) by operating activities:
Cash received from customers $3,714,421 1,439,628 1,085,167 964,931 223,181 7,427,328 6,173,385
Payments to suppliers (1,170,927) 3,944 (16,040) (420,736) (116,834) (1,720,593) (1,676,446)
Payments to employees (1,157,311) (34,000) — (300,279) (1,500) (1,493,090) (1,482,586)
Net cash provided (used) by
operating activities 1,386,183 1,409,572 1,069,127 243,916 104,847 4,213,645 3,014,353
Cash flows provided (used) by
noncapital financing activities:
State sources - grants 35,503 — — 9,006 — 44,509 27,799
Contribution to Providence Hospital — — — — — — (108,000)
Net change in interfund receivable/payable 56,085 969 — 14,018 — 71,072 133,098
Transfers in — — — 45,000 — 45,000 9,197,194
Transfers out — — — — — — (8,062,822)
Net cash provided (used) by noncapital
financing activities 91,588 969 — 68,024 — 160,581 1,187,269
Cash flows provided (used) by capital and
related financing activities:
Acquisition and construction of capital assets (131,454) (3,942) — (314,086) — (449,482) (676,420)
Interest paid on notes payable and
interfund borrowings (684,372) — (434,971) — — (1,119,343) (756,731)
Principal payments on notes payable
and interfund borrowings (1,091,284) — (547,804) — — (1,639,088) (3,339,483)
Refunding costs — — — — — — (11,500)
Proceeds from issuance of notes payable 81,376 — — — — 81,376 1,137,658
Net cash provided (used) by capital and
related financing activities (1,825,734) (3,942) (982,775) (314,086) — (3,126,537) (3,646,476)
Cash flows provided (used) by investing activities:
Interest and dividends received 32,435 23,850 2,753 66,047 — 125,085 236,985
Net change in cash and
cash equivalents (315,528) 1,430,449 89,105 63,901 104,847 1,372,774 792,131
Cash and equivalents, at beginning of year 7,873,203 1,090,240 3,260,026 2,036,604 22,258 14,282,331 13,490,200
Cash and equivalents, at end of year $ 7,557,675 2,520,689 3,349,131 2,100,505 127,105 15,655,105 14,282,331
Reconciliation of cash and cash equivalents
to the Statement of Net Position:
Equity in central treasury $ 7,255,175 2,520,689 2,366,056 2,100,505 127,105 14,369,530 12,996,677
Restricted cash and equivalents 302,500 — 983,075 — — 1,285,575 1,285,654
$7,557,675 2,520,689 3,349,131 2,100,505 127,105 15,655,105 14,282,331
(continued)
Proprietary Funds - Business - Type Activities - Enterprise Funds
(With summarized financial information for the year ended June 30, 2017)
Year ended June 30, 2018
Statement of Cash Flows
KODIAK ISLAND BOROUGH
36
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 2018 2017
Reconciliation of operating income (loss) to net
cash provided by operating activities:
Operating income (loss)$888,416 (27,878) 558,502 (595,690) — 823,350 (439,764)
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:
Depreciation 293,749 1,085,223 518,933 698,482 — 2,596,387 2,637,170
Pension expense (47,544) — — (11,643) — (59,187) 287,603
Accrual for landfill closure and
postclosure costs 331,000 — — — — 331,000 109,964
Changes in assets and liabilities that
provided (used) cash:
(Increase) decrease in assets:
Customer receivables (110,856) — — 24,149 (32,436) (119,143) 108,273
Accounts receivable - State of Alaska — — — — — — 2,567
Inventories 36,702 277,007 — — — 313,709 —
Notes receivable — — — 114,135 114,135 110,215
Increase (decrease) in liabilities:
Accounts payable (23,425) 19,864 — 8,200 137,283 141,922 55,956
Customer deposits 10,500 — — — — 10,500 7,500
Accrued compensation 7,641 — — 6,283 — 13,924 (20,408)
Other accrued liabilities — — — — — — 155,277
Unearned revenues — 55,356 (8,308) — — 47,048 —
Net cash provided (used) by
operating activities $1,386,183 1,409,572 1,069,127 243,916 104,847 4,213,645 3,014,353
See accompanying notes to financial statements.
Proprietary Funds - Business - Type Activities - Enterprise Funds, (Continued)
Year ended June 30, 2018
(With summarized financial information for the year ended June 30, 2017)
37
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements
Year Ended June 30, 2018
38
(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, 2018.
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
39
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
40
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 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 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 and debt service payments on
related debt.
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 and debt service payments on related debt.
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
41
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
42
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 cover rock that will be used to close cells at the Municipal Solid
Waste Landfill. Inventories are stated at cost (first-in, first-out) and are recorded as expenses when
used (consumption method).
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
43
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.
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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
44
Pension and Other Postemployment Benefits (OPEB)
For purposes of measuring the net pension and OPEB liabilities, deferred outflows of resources and
deferred inflows of resources related to pension and OPEB plans, and pension and OPEB 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
Government-wide net position is divided into three components:
Net investment in capital assets – consists of the historical cost of capital assets less
accumulated depreciation and less any debt that remains outstanding that was used to finance
those assets plus deferred outflows of resources less deferred inflows of resources related to
those assets.
Restricted net position – consists of assets that are restricted by the Borough’s creditors (for
example, through debt covenants), by the state enabling legislation (through restrictions on
shared revenues), by grantors (both federal and state), and by other contributors.
Unrestricted – all other net position is reported in this category.
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
45
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 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
46
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 FY2018 the Borough set a mill rate of 0.62 mills for
the General Fund, 6.8 mills for the Education Support Special Revenue Fund, 2.03 mills for the Debt
Service Fund and 1.30 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 FY2017.
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
47
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, accrued landfill closure and post-closure care costs, and the net pension and
OPEB liabilities and related deferred outflows and inflows of resources.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
48
(2) Stewardship, Compliance, and Accountability
(a) Excess of Expenditures over Appropriations
The following fund expenditures or operating expenses exceeded their budget:
Fund Excess
General Fund -
Public safety $ 4,015
Education Debt Service 12,459
Special Revenue Funds:
Fire Protection Area No. 1 466,109
Tourism Development 9,570
Enterprise Funds:
Long Term Care Center 77,639
911 Service Fund 15,617
(b) Deficit Fund Equity
The individual fund deficits at June 30, 2018, are as follows:
Education Support Special Revenue Fund $ 126,614
Kodiak High School Renovation Capital Project Fund $ 176,166
The deficit in these funds will be funded by transfers in from the General Fund in FY2019.
(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
49
As of June 30, 2018, the Borough had the following investments:
Investment Maturities (in years)
Fair Less
Investment Type Value than 1 1 to 5 6 +
U.S. Agency Securities:
Federal Home Loan Bank $ 16,803,730 9,907,760 5,927,840 968,130
Federal Home Loan
Mortgage Corporation 14,213,634 6,466,200 7,747,434 -
Federal Farm Credit Bank
Federal Agrigulture
16,631,290 - 16,631,290 -
Mortgage Corporation 1,963,640 - 1,963,640 -
Federal National Mortgage
Association 7,896,320 - 7,896,320 -
Municipal Obligations 4,415,053 3,222,956 61,737 1,130,360
Alaska Municipal League
Investment Pool 8,336,400 8,336,400 - -
Certificates of Deposit 719,311 719,311 - -
$ 70,979,378 28,652,627 40,228,261 2,098,490
In addition to the investments listed above, Kodiak Island Borough also had cash equivalents of $7,338,947,
which includes restricted cash of $1,285,575.
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, 2018:
Total Level 1 Level 2 Level 3
Investments by fair value level:
Debt securities:
U.S. Agency Securities $ 57,508,614 57,508,614 - -
Municipal Obligations 4,415,053 - 4,415,053 -
Total debt securities 61,923,667 57,508,614 4,415,053 -
Other investments:
Alaska Municipal League
Investment Pool 8,336,400 - 8,336,400 -
Certificates of Deposit 719,311 - 719,311 -
Total other investments 9,055,711 - 9,055,711 -
Total investments $ 70,979,378 57,508,614 13,470,764 -
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
50
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, 2018, 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
AA+ 90%
AA 10%
100%
At June 30, 2018, 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, 2018,
the Borough had 81% 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, $2,253,687 was uninsured.
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, 2018.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
51
(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, and
grounds maintenance services.
(5) Receivables
Education Education Other Total
General Support Special Debt Governmental Governmental
Fund Revenue Fund Service Fund Funds Funds
Receivables:
Grants $ 17,321 49,643 49,849 242,846 359,659
Taxes 480,789 239,099 62,741 70,858 853,487
Interest 300,209 — — — 300,209
Customers and other 30,370 — — 101,647 132,017
Notes receivable — — — 187,845 187,845
Gross receivables 828,689 288,742 112,590 603,196 1,833,217
Less: allowance
for uncollectibles (15,789) — — — (15,789)
Net total receivables $ 812,900 288,742 112,590 603,196 1,817,428
Municipal Kodiak Other
Solid Waste Fisheries Nonmajor Total Total
Collection Research Enterprise Enterprise Primary
and Disposal Center Fund Funds Government
Receivables:
Grants $ — — — — 359,659
Taxes — — — — 853,487
Interest — — — — 300,209
Customers and other 403,266 100,192 37,034 540,492 672,509
Notes receivable — 1,515,401 — 1,515,401 1,703,246
Gross receivables 403,266 1,615,593 37,034 2,055,893 3,889,110
Less: allowance
for uncollectibles — — — — (15,789)
Net total receivables $ 403,266 1,615,593 37,034 2,055,893 3,873,321
Enterprise Funds
Governmental Funds
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
52
(6) Note Receivable - General Services Administration (GSA) on-behalf of National Oceanic and
Atmospheric Administration (NOAA)
In April 2016 a 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, 2018, the principal balance due is $1,397,207 and the principal amount due within one year
is $118,194. 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, 2018, 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 $ 388,466 - 388,466
Unavailable land sales receivable 187,845 - 187,845
Grant advances prior to expending all proceeds - 33,161 33,161
Total unavailable/unearned revenue
for governmental funds $ 576,311 33,161 609,472
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KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
53
(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, 2018 was as follows:
Beginning Ending
Balance Increase Decrease Balance
Governmental activities:
Capital assets, not being
depreciated
Land $ 23,852,758 - (357,300) 23,495,458
Construction
work-in-progress 86,867,058 3,485,209 (4,016,461) 86,335,806
Total 110,719,816 3,485,209 (4,373,761) 109,831,264
Capital assets, being
depreciated:
Buildings and improvements 114,225,313 1,597,564 - 115,822,877
Improvements other than
buildings 22,128,118 2,351,068 - 24,479,186
Equipment 3,289,459 925,492 (81,043) 4,133,908
Infrastructure 5,762,722 - - 5,762,722
Total 145,405,612 4,874,124 (81,043) 150,198,693
Less accumulated
depreciation for:
Buildings and improvements 74,619,680 2,349,306 - 76,968,986
Improvements other than
buildings 10,833,549 1,217,582 - 12,051,131
Equipment 2,318,848 184,688 (81,043) 2,422,493
Infrastructure 5,193,301 75,923 - 5,269,224
Total 92,965,378 3,827,499 (81,043) 96,711,834
Total capital assets
being depreciated, net 52,440,234 1,046,625 - 53,486,859
Total governmental
activities, net $ 163,160,050 4,531,834 (4,373,761) 163,318,123
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
54
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 28,448,177 131,454 - 28,579,631
Total 30,099,425 131,454 - 30,230,879
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 2,058,259 - (12,638) 2,045,621
Total 7,406,663 - (12,638) 7,394,025
Less accumulated
depreciation for:
Unclassified utility plant in
service 1,337,631 42,055 - 1,379,686
Improvements other than
buildings 1,921,551 176,011 - 2,097,562
Machinery and equipment 1,638,589 75,683 (12,638) 1,701,634
Total 4,897,771 293,749 (12,638) 5,178,882
Total capital assets
being depreciated, net 2,508,892 (293,749) - 2,215,143
Total Municipal Solid
Waste Collection and
Disposal Fund, net $ 32,608,317 (162,295) - 32,446,022
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
55
Beginning Ending
Balance Increase Decrease Balance
Hospital Facilities Fund:
Capital assets, not being
depreciated
Artwork $ 16,091 - - 16,091
Land 10,251 - - 10,251
Construction in progress - 3,942 - 3,942
Total 26,342 - - 30,284
Capital assets, being
depreciated:
Buildings 33,100,284 - - 33,100,284
Improvements other than
buildings 401,046 - - 401,046
Machinery and equipment 3,627,068 - - 3,627,068
Total 37,128,398 - - 37,128,398
Less accumulated
depreciation for:
Buildings 18,644,112 1,071,422 - 19,715,534
Improvements other than
buildings 250,325 12,560 - 262,885
Machinery and equipment 3,591,854 1,241 - 3,593,095
Total 22,486,291 1,085,223 - 23,571,514
Total capital assets
being depreciated, net 14,642,107 (1,085,223) - 13,556,884
Total Hospital Facilities
Fund, net $ 14,668,449 (1,081,281) - 13,587,168
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
56
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 562,177 518,933 - 1,081,110
Total capital assets
being depreciated, net 15,005,809 (518,933) - 14,486,876
Total Long Term Care
Fund, net $ 15,005,809 (518,933) - 14,486,876
Kodiak Fisheries Research Center Fund:
Capital assets,
not being depreciated
Construction in progress $ - 314,086 - 314,086
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 10,702,484 594,680 - 11,297,164
Improvements other than
buildings 695,402 101,793 - 797,195
Machinery and equipment 1,185,671 2,009 - 1,187,680
Total 12,583,557 698,482 - 13,282,039
Total capital assets
being depreciated, net 8,830,031 (698,482) - 8,131,549
Total Kodiak Fisheries
Research Center Fund, net $ 8,830,031 (384,396) - 8,445,635
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
57
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 28,448,177 449,482 - 28,897,659
Total 30,125,767 449,482 - 30,575,249
Capital assets, being
depreciated:
Unclassified utility plant in
service 2,178,733 - - 2,178,733
Buildings 66,508,680 - - 66,508,680
Improvements other than
buildings 5,956,217 - - 5,956,217
Machinery and equipment 6,873,005 - (12,638) 6,860,367
Total 81,516,635 - (12,638) 81,503,997
Less accumulated
depreciation for:
Unclassified utility plant in
service 1,337,631 42,055 - 1,379,686
Buildings 29,908,773 2,185,035 - 32,093,808
Improvements other than
buildings 2,867,278 290,364 - 3,157,642
Machinery and equipment 6,416,114 78,933 (12,638) 6,482,409
Total 40,529,796 2,596,387 (12,638) 43,113,545
Total capital assets
being depreciated, net 40,986,839 (2,596,387) - 38,390,452
Total business-type
activities, net $ 71,112,606 (2,146,905) - 68,965,701
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
58
Depreciation expense was charged to the departments and functions of the primary government as follows:
Governmental activities:
General government $ 593,901
Public safety 161,181
Primary and secondary education 3,072,417
Total – governmental activities $ 3,827,499
Business-type activities:
Municipal solid waste collection and
disposal $ 293,749
Hospital facilities 1,085,223
Long Term Care Center 518,933
Kodiak fisheries research center 698,482
Total – business-type activities 2,596,387
Total primary government $ 6,423,886
(9) Interfund Receivables, Payables and Transfers
(a) Interfund Receivables and Payables
Interfund balances at June 30, 2018 consisted of the following:
Due to / from other funds:
Receivable Fund Payable Fund Amount
Major governmental funds:
General Fund Other Governmental Funds $ 709,233
General Fund Municipal Solid Waste Collection
and Disposal Enterprise Fund 56,085
General Fund Hospital Facilities Enterprise Fund 969
General Fund Kodiak Fisheries Research Center
Enterprise Fund 14,018
Total primary government $ 780,305
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
59
(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, 2018 were as follows:
Transfers In
Governmental Funds
Kodiak
Education and Fisheries
Health Other Research Center
General Debt Service Governmental Enterprise
Fund Fund Funds Fund Total
Transfers Out
Major Governmental Funds:
General Fund $ - - 403,958 - 403,958
Facilities Special Revenue Fund - 65,105 65,105 - 130,210
Education Debt Service Fund 492,936 - - - 492,936
Other Governmental Funds - - 162,000 45,000 207,000
Total transfers $ 492,936 65,105 631,063 45,000 1,234,104
A summary of significant transfers are as follows:
The General Fund transferred $403,958 to Other Capital Projects Fund to fund the re-
construction of the Chiniak Emergency Center.
The Building and Grounds Special Revenue Fund transferred $137,000 to Other Capital
Projects Fund to fund the re-construction of the Chiniak Emergency Center.
The Women’s Bay Road Service Area Special Revenue Fund transferred $25,000 to the Other
Capital Projects Fund for capital improvements.
The Education Debt Service Fund transferred $492,936 to the General Fund to repay costs
incurred by the General Fund in previous years as a result of the State of Alaska reducing
School Bond Reimbursements.
The Facilities Special Revenue Fund transferred $65,105 to the Education Debt Service Fund
for debt service on Borough bonds.
The Facilities Special Revenue Fund transferred $55,105 to the Renewal and Replacement
Special Revenue Fund for future projects.
The Facilities Special Revenue Fund transferred $10,000 to the Building and Grounds Special
Revenue Fund for property insurance costs.
The Tourism Development Special Revenue Fund transferred $45,000 to the Kodiak Fisheries
Research Center Enterprise Fund for tourism development activities.
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, 2017 Additions Reductions June 30, 2018 One Year
General obligation bonds:
$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 6,210,000 - 330,000 5,880,000 340,000
$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 4,305,000 - 460,000 3,845,000 480,000
$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 5,260,000 - 565,000 4,695,000 585,000
$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 18,680,000 - 820,000 17,860,000 855,000
$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 20,325,000 - 840,000 19,485,000 880,000
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
61
Balance Balance Due Within
July 1, 2017 Additions Reductions June 30, 2018 One Year
General obligation bonds, continued:
$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 6,015,000 - 200,000 5,815,000 205,000
$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
Renewal and Replacement bonds, 1,635,000 - 150,000 1,485,000 155,000
$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 1,840,000 - 65,000 1,775,000 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 4,905,000 - 440,000 4,465,000 465,000
$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 - - 4,905,000 395,000
$ 74,080,000 - 3,870,000 70,210,000 4,425,000
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, 2018, are as
follows:
Principal Interest Total
Year ending June 30:
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
2024-2028 23,830,000 8,397,909 32,227,909
2029-2033 18,850,000 3,461,490 22,311,490
2034-2036 3,430,000 213,093 3,643,093
$ 70,210,000 26,327,439 96,537,439
At June 30, 2018, there was $207,204 available in the Education 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, 2018, 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, 2018, interest accrued at 1.5%. The first loan payment
was made on April 1, 2012, with principal payments of $100,000 due
on April 1 in each successive year.
$
1,300,000
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 was made on
April 1, 2018, with principal payments of $637,846 due on April 1 in
each successive year.
$
12,119,067
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 principal payments of $131,227 being due on March 1 in
each successive year.
$
2,230,852
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 principal payments ranging from $215,000 to $295,000 due on
September 1 and March 1 of each year. The bond will mature on
September 1, 2026.
$
2,479,898
As of June 30, 2018, 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 3.0 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.
$
11,327,067
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, 2018, was as follows:
Balance Balance
June 30,June 30,Due within
2017 Additions Reductions 2018 one year
Governmental activities:
Bonds payable:
General obligation bonds $74,080,000 — 3,870,000 70,210,000 4,425,000
Bond premium 8,222,899 — 684,407 7,538,492 684,407
82,302,899 — 4,554,407 77,748,492 5,109,407
Compensated absences 242,398 354,565 377,482 219,481 86,041
Total $ 82,545,297 354,565 4,931,889 77,967,973 5,195,448
Business-type activities:
Municipal Solid Waste
Collection and Disposal:
Landfill closure and
post-closure costs $5,204,000 331,000 — 5,535,000 —
Notes and bonds payable 19,139,725 81,376 1,091,284 18,129,817 1,101,283
Total $ 24,343,725 412,376 1,091,284 23,664,817 1,101,283
Long Term Care Center:
Bonds payable $11,874,871 — 547,804 11,327,067 557,804
Business-type activities:
Landfill closure and post-
closure costs $5,204,000 331,000 — 5,535,000 —
Notes/bonds payable 31,014,596 81,376 1,639,088 29,456,884 1,659,087
Total $ 36,218,596 412,376 1,639,088 34,991,884 1,659,087
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, 2018 are as follows:
Facilities Education
Special Debt Other
General Revenue Service Governmental
Fund Fund Fund Funds Total
Nonspendable:
Prepaid Items $ 37,885 - - 4 37,889
Committed:
Facility Upgrades - 39,371,219 - - 39,371,219
Debt Service - - 207,204 - 207,204
Fire and Road
Service Areas - - - 1,811,733 1,811,733
Land Sales - - - 1,366,459 1,366,459
Buildings and Grounds - - - 784,298 784,298
Street Lighting
Districts - - - 59,853 59,853
Tourism Development - - - 215,431 215,431
Mission Lake Tide Gate - - - 60,166 60,166
Total Committed $ - 39,371,219 207,204 4,297,940 43,876,363
Assigned:
Capital Projects and
Upgrades $ - - - 5,588,158 5,588,158
(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 $5,535,000 as of June 30, 2018, which is based on 37.5% usage (filled) of the landfill.
The Borough recorded closure/post-closure expenses of $367,702 resulting from actual cost outlays of
$36,702 to close existing cells and estimated future costs of $331,000 for closure and post-closure costs. The
estimated total current cost of the landfill closure and post closure care of $5,535,0000 is based on the amount
that would be paid if the landfill were closed as of June 30, 2018. 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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
66
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 2019. 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.
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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
67
(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.
(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
was renegotiated in 2017 and is effective through fiscal year 2027. 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 established a 20 year renewal and replacement schedule,
provided for a 3% administrative fee to be paid to the Borough, as well as $100,000 annual
payment to replenish the Borough’s Hospital Enterprise Fund Net Position. If renewal and
replacement costs are 25% greater than the budgeted costs, the lease payment may be amended
to incorporate these cost overruns. If projects greater than $50,000 are necessary to meet federal
or state facility audits, the lease payment may be amended to incorporate these cost overruns.
(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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
68
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).
The monthly lease payment will be adjusted on January 1, each year and is based on the
Borough’s required debt service payments and costs to insure the facility. The current lease
payment through December 31, 2018, is $86,968.
(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 both the
National Oceanic and Atmospheric Administration (NOAA) and the Natural Resources
Commision (NRC), the University of Alaska Fairbanks (UAF), and Kodiak Regional
Aquaculture Association (KRAA).
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 escalates each year and is
currently $59,428.
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 $1,515,401 as of June 30, 2018.
The lease with NRC commenced on March 1, 2018, and extends through February 28, 2038,
with rents escalating every three years. The current annual rate of $24,433 is effective through
February 28, 2021.
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 2018 UAF paid $39,870 to lease dorm space at the research facility.
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 $18,925.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
69
(15) Change in Accounting Principal
As discussed in Note 16 to the financial statements, the Kodiak Island Borough participates in the
Alaska Public Employees’ Retirement System (PERS). In 2018, the Kodiak Island Borough adopted
the provisions of GASB Statement No. 75 Accounting and Financial Reporting for Postemployment
Benefits Other Than Pensions, which, among other accounting and reporting criteria, requires the
Kodiak Island Borough to recognize its proportional share of the net other postemployment benefit
plans (OPEB) liability (and related deferred inflow/outflow accounts), as of the beginning of the Kodiak
Island Borough’s fiscal year. As a result of the implementation of this statement, the Kodiak Island
Borough has recorded an opening balance adjustment to increase liabilities and to decrease opening net
position as follows:
Governmental Business-Type
Activities Activities Total
Opening net position, as originally presented $ 129,150,733 49,682,444 $ 178,833,177
Change in accounting principal adjustment (1,045,654) (264,361) (1,310,015)
Opening net position, as restated $ 128,105,079 49,418,083 $ 177,523,162
(16) Employee Retirement System Plans
The Kodiak Island Borough (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, PERS
also administers other post-employment benefit (OPEB) 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.
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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
70
PERS acts as the common investment and administrative agencies 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 (OPEB)
Healthcare Reimbursement Arrangement Plan Defined Benefit OPEB
Defined Contribution Other Postemployment
Benefits (DC)
Occupational Death and Disability Plan Cost-sharing, Defined Contribution OPEB
Alaska Retiree Healthcare Trust Plan Cost-sharing, Defined Contribution OPEB
Retiree Medical Plan Cost-sharing, Defined Contribution OPEB
Other Postemployment Benefit Plans (OPEB)
Occupational Death and Disability Plan (ODD)
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. Membership in
the plan consisted of the following at June 30, 2017 (latest available report):
Membership PERS
Active plan members 19,442
Participating employers 155
Alaska Retiree Healthcare Trust Plan (ARHCT)
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). Membership in the plan consisted of the following at
June 30, 2017 (latest report available):
Membership PERS
Inactive plan members or beneficiaries currently receiving benefits 34,310
Inactive plan members entitled to but not yet receiving benefits 5,799
Active plan members 14,956
Total plan membership 55,065
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
71
Retiree Medical Plan (RMP)
The retiree medical plan provides major medical coverage to retirees of the DC plan. The plan is self-
insured. Members are not eligible to use this plan until they have at least 10 years of service and are
Medicare age eligible. Membership in the plan consists of the following at June 30, 2017 (latest
available report):
Membership PERS
Inactive plan members or beneficiaries currently receiving benefits 5
Inactive plan members entitled to but not yet receiving benefits 831
Inactive plan members not entitled to benefits 10,466
Active plan members 19,442
Total plan membership 30,744
Healthcare Reimbursement Arrangement Plan
The Healthcare Reimbursement Arrangement Plan was established to allow medical expenses to be
reimbursed from individual savings accounts established for eligible participants. Membership in the
plan consists of the following at June 30, 2017 (latest available report):
Membership PERS
Inactive plan members or beneficiaries currently receiving benefits 7
Inactive plan members entitled to but not yet receiving benefits 829
Inactive plan members not entitled to benefits 10,466
Active plan members 19,442
Total plan membership 30,744
Investments
The Board is the investment oversight authority of the system’s investments. As the fiduciary, the
Board has the statutory to invest the assets under the Prudent Investor Rule. Fiduciary responsibility
for the Board’s invested assets is pursuant to AS 37.10.210.390.
Treasury provides staff for the Board. Treasury has created a pooled environment by which it manages
investments of the Board. Additionally, Treasury manages a mix of Pooled Investment Funds and
Collective Investment Funds for the DC Participant-directed Pension plans under the Board’s fiduciary
responsibility.
Rate of Return
The money-weighted rate of return expresses investment performance, net of investment expense,
adjusted for the changing amounts actually invested. The annual weighted rate of return, net of
investment expense for the year ended June 30, 2017 (latest available report) for the DB Plan is 12.99%,
for the ARHCT is 12.69%, for the Occupational Death and Disability Plan is 11.97%, and for the
Retiree Medical Plan is 11.93%.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
72
For additional information on securities lending, interest rates, credit risks, foreign exchange,
derivatives, fair value, and counterparty credit risks, see the separately issued report on the Invested
Assets of the State of Alaska Retirement and Benefits Plans at:
http://treasury.dor.alaska.gov/armb/Reports-and-Policies/Annual-Audited-Financial-Schedules.aspx.
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.
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.
The DB Plan’s membership consisted of the following at June 30, 2017 (latest available report):
Inactive plan members or beneficiaries currently receiving benefits 34,310
Inactive plan members entitled to but not receiving benefits 5,799
Active plan members 14,956
Total DB plan membership 55,065
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%.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
73
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.
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
2018 the past service rate is 15.28%.
Employee Contribution Rate. The Borough’s active PERS members are required to contribute 6.75%
(5.25% pension costs and 1.50% OPEB) of their annual covered salary.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
74
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% (17.12% pension costs and 4.88% 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 25.01% (19.46%
pension and 5.55% 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 2018 is 3.01% (75.54%
pension and 24.46% 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. The rate uses an 8% pension discount rate.
Employer contributions for the year ended June 30, 2018, were:
Pensions
(DB)
Other Post-Employment
Benefits (DB)
Total
$ 483,892 137,930 621,822
Public Employees Retirement Plans
For the year ended June 30, 2018 the State of Alaska contributed $89,317 (75.54% pension cost) and
$28,921 (24.46% OPEB cost) on-behalf of the Borough, which has been recorded in the fund financial
statement 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, 2017 to a total of
$222,708, to represent the pension/OPEB expense attributable to the State under the full accrual basis
of accounting.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
75
Pension and OPEB Liabilities, Pension and OPEB Expense, and Deferred Outflows of Resources and
Deferred Inflows of Resources Related to Pensions and OPEB: At June 30, 2018, the Borough reported
liabilities that reflected a reduction for State pension and OPEB support provided to the Borough. The
amount recognized by the Borough as its proportionate share of net pension and OPEB liabilities, the
related State support, and the total portion of the net pension and OPEB liabilities (assets) that was
associated with the Borough were as follows:
Defined Benefit: Pension
Borough’s proportionate share of the net pension liability $ 5,687,130
State’s proportionate share of the net pension liability 2,118,453
Total $ 7,805,583
OPEB
Borough’s proportionate share of the ARHCT OPEB liability $ 929,853
State’s proportionate share of the ARHCT OPEB liability 347,255
Total $ 1,277,108
Defined Contribution:
Borough’s proportionate share of the ODD OPEB liability (asset) $ (20,405)
Borough’s proportionate share of the RMP OPEB liability 7,500
Total $ (12,905)
Total Borough’s share of net pension and OPEB liabilities $ 6,604,078
$5,250,303 of the net pension and OPEB liabilities is reported in governmental activities and
$1,353,775 is reported in business-type activities.
The net pension and OPEB liabilities were measured as of June 30, 2017, and the total pension and
OPEB liabilities used to calculate the net pension and OPEB liabilities were determined by an actuarial
valuation as of that date. The Borough’s proportion of the net pension and OPEB liabilities were based
on the present value of contributions for FY2019 through FY2039, as determined by projections based
on the June 30, 2017 valuation. At June 30, 2018, the Borough’s proportion of the pension liability
was 0.1100%, which is a decrease of 0.0230% from June 30, 2017. At June 30, 2018, the Borough’s
proportion of the ARCHT, ODD and RMP OPEB liabilities were 0.1101%, 0.1438%, and 0.1438%,
respectively, which represent a decrease of 0.0231%, and an increase of 0.0153%, and 0.0153%,
respectively, from June 30, 2017.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
76
Based on the measurement date of June 30, 2017, the Borough recognized pension and OPEB expense
of $429,332 and $144,389, respectively, for the year ended June 30, 2018. At June 30, 2018, the
Borough reported deferred outflows of resources and deferred inflows of resources related to pensions
and OPEB from the following sources:
Pension
Deferred Outflows Deferred Inflows
Defined Benefit: of Resources of Resources
Differences between expected and actual
experience $ - (102,249)
Changes of assumptions - -
Net difference between projected and actual
earnings on pension plan investments 152,549 -
Changes in proportion and differences between
Borough contributions and proportionate
share of contributions 38,747 (549,458)
Borough contributions subsequent to the
measurement date 483,892 -
Total $ 675,188 (651,707)
OPEB ARHCT
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual
experience $ - (50,144)
Changes of assumptions - -
Net difference between projected and actual
earnings on OPEB plan investments - (291,191)
Changes in proportion and differences between
Borough contributions and proportionate
share of contributions - (135,207)
Borough contributions subsequent to the
measurement date 137,930 -
Total $ 137,930 (476,542)
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
77
OPEB ODD
Deferred Outflows Deferred Inflows
Defined Contribution: of Resources of Resources
Differences between expected and actual
experience $ - (602)
Changes of assumptions - -
Net difference between projected and actual -
earnings on OPEB plan investments - (1,275)
Changes in proportion and differences between
Borough contributions and proportionate
share of contributions - (2,026)
Borough contributions subsequent to the
measurement date 3,283 -
Total $ 3,283 (3,903)
OPEB RMP
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual
experience $ - (59)
Changes of assumptions - -
Net difference between projected and actual
earnings on OPEB plan investments - (3,645)
Changes in proportion and differences between
Borough contributions and proportionate
share of contributions 1,255 -
Borough contributions subsequent to the
measurement date 19,210 -
Total $ 20,465 (3,704)
$483,892 and $160,423 is reported as deferred outflows of resources related to pension and OPEB
resulting from Borough contributions subsequent to the measurement date will be recognized as a
reduction of the net pension and OPEB liabilities in the year ended June 30, 2019, respectively. Other
amounts reported as deferred outflows of resources and deferred inflows of resources related to pension
and OPEB will be recognized in pension and OPEB expense as follows:
Year Ended
June 30,
Pension
OPEB
ARHCT
OPEB
ODD
OPEB
RMP
2018 $ (602,319) (175,772) (643) (764)
2019 158,850 (155,176) (643) (764)
2020 71,310 (72,797) (643) (764)
2021 (88,252) (72,797) (643) (764)
2022 - - (324) 148
Thereafter - - (1,007) 459
Total $ 460,411 (476,542) (3,903) (2,449)
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
78
For the year ended June 30, 2018, the Borough recognized ($190,209) and ($75,210) of pension and
OPEB amortization of the net deferred outflows and inflows of resources, respectively.
Actuarial Assumptions: The total pension and OPEB liabilities in the June 30, 2017 (latest available)
actuarial valuation was determined by an actuarial valuation as of June 30, 2016, which was rolled
forward to June 30, 2017. These assumptions were the result of an experience study performed as of
June 30, 2013.
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)
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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
79
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.
Healthcare cost trend rates Pre-65 medical: 8.8% grading down to 4.4%
Post-65 Medical: 5.8% grading down to 4.0%
Prescription drugs: 5.4% grading down to 4.0%
The long-term expected rate of return on pension and OPEB 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 8.83%
Global Ex- U.S. Equity 7.79%
Intermediate Treasuries 1.29%
Opportunistic 4.76%
Real Assets 4.94%
Absolute Return 4.76%
Private Equity 12.02%
Cash Equivalents 0.63%
Discount Rate: The discount rate used to measure the total pension and OPEB liabilities is 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 and OPEB plans fiduciary net pension and OPEB were 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 and OPEB plan investments were applied to all periods of
projected benefit payments to determine the total pension and OPEB liabilities.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
80
Sensitivity of the Net Pension and OPEB Liabilities 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 $ 7,470,569 5,687,130 4,181,083
Net OPEB ARHCT liability $ 1,989,983 929,853 38,138
Net OPEB ODD liability $ (18,420) (20,405) (22,027)
Net OPEB RMP liability $ 35,134 7,500 (14,079)
Sensitivity of the Borough’s proportionate share of the net OPEB liability to changes in the healthcare
cost trend rates. The following present the Borough’s proportionate share of the net OPEB liability, as
well as what the Borough’s proportionate share of the net OPEB liability would be if it were calculated
using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point higher than
the current healthcare cost trend rates:
1% Decrease Current Rate 1% Increase
Net OPEB ARHCT liability $ (103,146) 929,853 2,171,766
Net OPEB ODD liability N/A (20,405) N/A
Net OPEB RMP liability (18,564) 7,500 42,421
Alaska Public Employee Retirement System (PERS) – Defined Contribution Plan (DC)
Plan Description and Funding Requirements. 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): 1.03% for the retiree medical plan (DB), 0.16% 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%.
Currently there are 155 employers participating in the defined contribution plan, including the State of
Alaska. At June 30, 2017 (latest available report), membership in the DC plan consisted of 1,735 peace
officers and firefighters and 19,532 of other members.
Plan members are 100% vested with their contributions.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
81
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%
The Borough contributed $169,685 for the year ended June 30, 2018.
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, 2018, were $95,756.
The first plan is managed by the International City Managers Association Retirement Corporation.
$47,856 was contributed to this plan during the year ended June 30, 2018. The Borough believes that
the plan does not meet the criteria for inclusion as a fiduciary fund.
The second plan is managed by the MassMutual Financial Group. $47,900 was contributed to this
plan during the year ended June 30, 2018. The Borough believes that the plan does not meet the
criteria for inclusion as a fiduciary fund.
(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.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
82
(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%. 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, 2018, the amount of
defeased debt still outstanding was $4,870,000.
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.
As a result, a portion of the 2013 Series Two bonds are considered to be defeased and the liability for those
bonds has been removed from the financial statements As of June 30, 2018, the amount of defeased debt still
outstanding was $4,105,000.
(19) Subsequent Events
The Borough received notice on June 18, 2018, from the State of Alaska, Department of Administration,
Division of Retirement and Benefits that Forfeitures from the defined contribution plan for the Public
Employees’ Retirement System (PERS) can be offset against future contributions effective July 1, 2018. The
Borough has $57,419 in PERS forfeitures to be used towards future contributions.
In October 2018 the Borough settled a lawsuit with Watterson Construction related to the high school
construction project. $525,000 has been accrued as accounts payable and expenditures as of June 30, 2018.
Management have evaluated all other subsequent events through December 20, 2018, the date which the
financial statements were available for issue.
(20) 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 Enterpirse Fund.
Conversely, the LTCC Enterprise Fund recognized a loss of $1,721,113.
(21) Construction Commitments
The Borough has outstanding commitments for construction at year end of $2,706,790.
KODIAK ISLAND BOROUGH
Notes to Basic Financial Statements, Continued
83
(22) Subsequent Accounting Pronouncements
The Governmental Accounting Standards Board has passed several new accounting standards with upcoming
implementation dates covering several topics as follows:
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 87 – Leases. Effective for fiscal years beginning after December 15, 2019.
GASB 88 – Certain Disclosures Related to Debt, Including Direct Borrowings and Direct
Placements. Effective for fiscal years beginning after June 15, 2018.
Statements 83 and 84 are not expected to have any significant impact on the financial statements of the
Borough.
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.
GASB Statement No. 88, the objective of this Statement is to improve the information that is disclosed in notes
to government financial statements related to debt, including direct borrowings and direct payments. It also
clarifies which liabilities governments should include when disclosing information related to debt. This
Statement defines debt and requires enhanced footnote disclosures.
REQUIRED SUPPLEMENTARY
INFORMATION
Budgetary Comparison Schedule
General Fund
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget –
Budget Positive 2017
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments:
Real $744,135 744,135 737,826 (6,309)159,796
Personal 84,631 84,631 84,827 196 21,508
Boat — — — — (64)
Aircraft 26,500 26,500 30,000 3,500 26,500
Penalty and interest 148,500 148,500 219,086 70,586 213,373
Total property taxes and assessments 1,003,766 1,003,766 1,071,739 67,973 421,113
Severance taxes:
Fish 1,395,000 1,395,000 1,660,842 265,842 1,182,924
Mining 20,000 20,000 53,618 33,618 73,495
Logging 20,000 20,000 101,463 81,463 50,088
Total severance taxes 1,435,000 1,435,000 1,815,923 380,923 1,306,507
Intergovernmental:
State sources:
State revenue sharing 390,200 465,942 465,942 — 461,512
Fisheries business tax 1,150,000 1,103,101 1,103,101 — 1,270,403
Fisheries resource landing tax 35,500 14,868 14,868 — 60,422
Telephone and electric tax 15,500 15,500 17,321 1,821 16,481
On-behalf PERS payment 99,382 99,382 86,701 (12,681)107,145
Marijuana license 2,500 2,500 500 (2,000)—
Total state sources 1,693,082 1,701,293 1,688,433 (12,860) 1,915,963
Federal sources:
Payments in lieu of taxes 1,331,000 1,331,000 1,621,466 290,466 1,592,112
Fish and Wildlife revenue sharing 112,500 191,973 191,973 — 230,082
Total federal sources 1,443,500 1,522,973 1,813,439 290,466 1,822,194
Total intergovernmental
revenue 3,136,582 3,224,266 3,501,872 277,606 3,738,157
Charges for services -
Sale of copies and maps 1,500 1,500 2,064 564 904
Licenses, permits and fees:
Building and trailer permits 40,000 40,000 42,466 2,466 57,928
Subdivision and zoning fees 12,250 12,250 11,280 (970)16,785
Other permits 9,500 9,500 8,604 (896)8,833
Total licenses, permits and fees 61,750 61,750 62,350 600 83,546
Tobacco excise tax 200,000 200,000 310,482 110,482 —
Investment income 13,000 13,000 10,830 (2,170) 11,059
Other 10,375 10,375 4,650 (5,725) 2,811
Total revenues 5,861,973 5,949,657 6,779,910 830,253 5,564,097
(continued)
2018
KODIAK ISLAND BOROUGH
84
Budgetary Comparison Schedule
General Fund, continued
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget –
Budget Positive 2017
Original Final Actual (Negative)Actual
Expenditures:
General government:
General administration $253,700 341,384 194,859 146,525 177,983
Borough assembly 157,593 157,593 147,431 10,162 149,570
Borough manager 640,931 640,931 596,369 44,562 516,460
Borough clerk 564,427 564,427 536,455 27,972 519,422
Borough attorney 140,500 140,500 104,848 35,652 107,487
Finance department 880,938 880,938 758,166 122,772 719,954
Management information systems 898,269 898,269 806,485 91,784 810,500
Assessing department 739,669 739,669 789,476 (49,807)743,480
Engineering/facilities department 331,047 331,047 465,177 (134,130)319,031
Total general government 4,607,074 4,694,758 4,399,266 295,492 4,063,887
Public safety - animal control 110,000 110,000 114,015 (4,015) 109,415
Community and economic development:
Community development department 894,786 894,786 880,241 14,545 860,160
Building official 169,130 169,130 166,451 2,679 96,979
Economic development 32,100 32,100 33,936 (1,836)30,268
Total community and economic
development 1,096,016 1,096,016 1,080,628 15,388 987,407
Emergency preparedness 118,349 118,349 43,038 75,311 35,861
Health and social services 207,500 207,500 207,500 — 233,999
Education, culture, and recreation 4,500 4,500 4,665 (165)17,562
Parks and recreation 139,470 139,470 77,186 62,284 30,172
Kodiak College and city libraries 72,000 72,000 72,000 — 96,000
Total expenditures 6,354,909 6,442,593 5,998,298 444,295 5,574,303
Excess (deficiency) of revenues
over expenditures (492,936) (492,936)781,612 1,274,548 (10,206)
Other financing sources (uses):
Proceeds from sale of assets — — 1,240 1,240 —
Transfers in 492,936 492,936 492,936 — —
Transfers out — (403,958) (403,958) — (958,451)
Net other financing sources (uses)492,936 88,978 90,218 1,240 (958,451)
Change in fund balance $— (403,958)871,830 1,275,788 (968,657)
Fund balance, at beginning of year 2,317,124 3,285,781
Fund balance, at end of the year $ 3,188,954 2,317,124
See accompanying notes to required supplementary information.
2018
KODIAK ISLAND BOROUGH
85
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Special Revenue Fund – Education Support
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget –
Budget Positive 2017
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments:
Real $8,221,174 8,221,174 8,152,772 (68,402) 8,892,817
Personal 903,326 903,326 928,259 24,933 1,095,560
Intergovernmental - state sources -
Motor vehicle tax 253,000 253,000 237,895 (15,105) 235,177
Total revenues 9,377,500 9,377,500 9,318,926 (58,574) 10,223,554
Expenditures:
Primary and secondary education 9,377,500 9,377,500 9,377,500 — 10,277,548
Excess (deficiency) of revenues
over expenditures $— — (58,574) (58,574) (53,994)
Fund balance (deficit), at beginning of year (68,040) (14,046)
Fund balance (deficit), at end of year $ (126,614) (68,040)
See accompanying notes to required supplementary information.
2018
86
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Special Revenue Fund – Facilities
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget –
Budget Positive 2017
Original Final Actual (Negative) Actual
Revenues -
Investment income $170,000 170,000 203,430 33,430 191,391
Expenditures 39,790 39,790 — 39,790 —
Excess of revenues over
expenditures 130,210 130,210 203,430 73,220 191,391
Other financing sources (uses) -
Transfers out (130,210) (130,210) (130,210) — (438,313)
Change in fund balance $— — 73,220 73,220 (246,922)
Fund balance, at beginning of year 39,297,999 39,544,921
Fund balance, at end of year $ 39,371,219 39,297,999
See accompanying notes to required supplementary information.
2018
87
KODIAK ISLAND BOROUGH
Notes to Required Supplementary Information – Budgetary Comparison Schedules
June 30, 2018
88
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 2018 budget document. That document may be obtained from the Kodiak
Island Borough, Finance Director, 710 Mill Bay Road, Kodiak, Alaska 99615.
Borough's
Proportionate Plan Fiduciary
Borough's Borough's State of Alaska Share of the Net Position as
Proportion Proportionate Proportionate Net Pension a Percentage
of the Net Share of the Share of the Total Borough's Liability as a of the Total
Pension Net Pension Net Pension Net Pension Covered Percentage of 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%
0.1100%$5,687,130 $2,118,453 $7,805,583 $3,055,486 186%63.37%
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 2018 is based upon Plan measurement date June 30, 2017.
This schedule is intended to present 10 years of information. Additional years' information will be included as it becomes available.
2018
KODIAK ISLAND BOROUGH
Public Employees' Retirement System (PERS)
Schedule of the Borough's Proportionate Share of the Net Pension Liability
June 30, 2018
Year
89
Borough's Plan Fiduciary
Borough's Borough's State of Alaska Proportionate Net Position as
Proportion Proportionate Proportionate Share of the a Percentage
of the Net Share of the Share of the Total Net OPEB of the Total
OPEB Net OPEB Net OPEB Net OPEB Borough's Liability as a OPEB
Liability Liability Liability Liability Covered Percentage of Liability
(Asset) (Asset) (Asset) (Asset) Payroll Payroll (Asset)
Alaska Retiree Healthcare Trust Plan (ARHCT):
0.1101% $ 929,853 $ 347,255 $ 1,277,108 $ 3,055,486 30.43% 89.68%
Occupational Death and Disability (ODD):
0.1438% $ (20,405) $ - $ (20,405) $ 1,496,624 -1.36% 212.97%
Retiree Medical Plan (RMP):
0.1438% $ 7,500 $ - $ 7,500 $ 1,496,624 0.50% 93.98%
Notes to Schedule:
1.
2. Measurement is one year prior to fiscal year end for all years presented.
3.
4. This schedule is intended to present 10 years of information. Additional years' information will be included as it becomes available.
Information presented for 2018 is based upon Plan measurement date June 30, 2017.
In fiscal year 2017 the Borough implemented GASB 82, which required a retroactive change in covered payroll.
KODIAK ISLAND BOROUGH
Schedule of the Borough's Proportionate Share of the Net OPEB Liability
Public Employees' Retirement System (PERS)
June 30, 2018
Year
2018
2018
2018
90
Contributions
Relative to the Contributions
Contractually Contractually Contribution Borough's as a Percentage
Required Required Deficiency Covered of Covered
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%
$483,892 $(483,892) $- $3,597,759 13.45%
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.
15. In fiscal year 2018 the Borough included pension DBUL into the contractually required contribution. This will be a prospective change.
contributions are reported.
3.12% per annum.
KODIAK ISLAND BOROUGH
Public Employees' Retirement System (PERS)
Schedule of the Borough's Contributions (Pensions)
June 30, 2018
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, 2017, which was rolled forward to June 30, 2018.
2018
Ranges from 9.66% to 4.92% based on service for Peace Officer/Firefighter. Ranges from 8.55% 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.
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-termination rates. Deaths are assumed to be occupational 70% of the
time for Peace Officers / Firefighters, 50% of the time for Others, 96% of all rates of the RP - 2000
Table Base Year projected to 2018 with projected scale BB.
91
Contributions
Relative to the Contributions
Contractually Contractually Contribution Borough's as a Percentage
Required Required Deficiency Covered of Covered
Contribution Contribution (Excess) Payroll Payroll
Alaska Retiree Healthcare Trust Plan (ARHCT):
$ 137,930 $ (137,930) $ - $ 3,597,759 3.83%
Occupational Death and Disability (ODD):
$ 3,283 $ (3,283) $ - $ 1,865,541 0.18%
Retiree Medical Plan (RMP):
$ 19,210 $ (19,210) $ - $ 1,865,541 1.03%
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
Schedule of the Borough's Contributions (OPEB)
Public Employees' Retirement System (PERS)
June 30, 2018
Year
Pre-termination mortality rates were based upon the 2010-2013 actual mortality experience, 60% of
male and 65% of female post-termination rates. Deaths are assumed to be occupational 70% of the
time for Peace Officers / Firefighters, 50% of the time for Others, 96% of all rates of the RP - 2000
Table Base Year projected to 2018 with projected scale BB.
2018
June 30, 2017, which was rolled forward to June 30, 2018.
Actuarially determined contribution rates are calculated as of June 30th, two years prior to the fiscal year in which
contributions are reported.
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.
3.12% per annum.
Ranges from 9.66% to 4.92% based on service for Peace Officer/Firefighter. Ranges from 8.55% to
8%, net of OPEB 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.
2018
2018
92
ADDITIONAL SUPPLEMENTARY INFORMATION
KODIAK ISLAND BOROUGH
Budgetary Comparison Schedule
Debt Service Fund - Education
Year ended June 30, 2018
(With summarized financial information for the year ended June 30, 2017)
Variance with
Final Budget –
Positive 2017
Original Final Actual (Negative)Actual
Revenues:
Property taxes and assessments $2,724,701 2,724,701 2,711,114 (13,587) 2,503,607
Intergovernmental:
State sources 4,985,040 4,985,040 4,985,040 — 3,840,763
Investment income (loss)— — (1,746) (1,746) (608)
Total revenues 7,709,741 7,709,741 7,694,408 (15,333) 6,343,762
Expenditures:
General government 3,600 3,600 16,059 (12,459) 11
Debt service:
Principal 3,870,000 3,870,000 3,870,000 — 3,530,000
Interest 3,408,310 3,408,310 3,408,310 — 3,568,559
Debt issuance — — — — 64,313
Total expenditures 7,281,910 7,281,910 7,294,369 (12,459) 7,162,883
Excess (deficiency) of revenues
over expenditures 427,831 427,831 400,039 (27,792) (819,121)
Other financing sources (uses):
Bond issuance — — — — 4,905,000
Premium on bonds issued — — — — 806,205
Payment to refunding escrow — — — — (5,934,301)
Transfers in 65,105 65,105 65,105 — 1,059,380
Transfers out (492,936) (492,936) (492,936) — —
Net other financing sources (uses) (427,831) (427,831) (427,831) — 836,284
Change in fund balance $— — (27,792) (27,792) 17,163
Fund balance, at beginning of year 234,996 217,833
Fund balance, at end of year $ 207,204 234,996
2018
Budget
93
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.
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 cruise ship tax revenue.
The Mission Lake Tide Gate Fund accounts for activities related to maintaining the tide gate for the residents of
the service area.
KODIAK ISLAND BOROUGH
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2018
(With summarized financial information at June 30, 2017)
Special Capital
Revenue Project
Assets Funds Funds 2018 2017
Equity in central treasury $ 4,243,187 7,509,947 11,753,134 8,403,655
Receivables:
State of Alaska 10,663 613 11,276 9,431
Federal government 154,762 76,808 231,570 49,923
Property taxes 35,144 35,714 70,858 31,450
Land sales contracts, due within one year 17,970 — 17,970 24,135
Other 47,460 54,187 101,647 79,484
Prepaid items 4 — 4 419,212
Land sale contracts, due after one year 169,875 — 169,875 360,657
Total assets $ 4,679,065 7,677,269 12,356,334 9,377,947
Liabilities:
Accounts payable $138,611 1,575,098 1,713,709 259,539
Customer deposits 2,450 — 2,450 27,450
Due to other funds 49,984 659,249 709,233 802,600
Unearned revenues 2,231 30,930 33,161 30,930
Total liabilities 193,276 2,265,277 2,458,553 1,120,519
Deferred inflows of resources -
Unavailable revenues 187,845 — 187,845 384,792
Total liabilities and deferred
inflows of resources 381,121 2,265,277 2,646,398 1,505,311
Fund balances:
Nonspendable 4 — 4 419,212
Committed 4,297,940 — 4,297,940 4,502,105
Assigned — 5,588,158 5,588,158 3,073,997
Unassigned — (176,166) (176,166) (122,678)
Total fund balances 4,297,944 5,411,992 9,709,936 7,872,636
Total $ 4,679,065 7,677,269 12,356,334 9,377,947
Totals
Resources and Fund Balances (Deficits)
Liabilities, Deferred Inflows of
94
KODIAK ISLAND BOROUGH
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
Year ended June 30, 2018
(With summarized financial information for year ended June 30, 2017)
Special Capital
Revenue Project
Funds Funds 2018 2017
Revenues:
Property taxes and assessments $1,402,168 1,736,076 3,138,244 2,787,175
Transient accommodations tax 113,486 — 113,486 108,050
Intergovernmental:
State sources 61,235 2,870 64,105 92,435
Federal sources 159,846 93,828 253,674 806,343
Charges for services 876,635 — 876,635 790,882
Licenses, permits and fees 37,310 — 37,310 2,125,324
Investment income 29,734 39,607 69,341 43,017
Rental 14,400 — 14,400 14,160
Other 1,332 284,361 285,693 6,335
Total revenues 2,696,146 2,156,742 4,852,888 6,773,721
Expenditures:
Current:
General government 775,621 525,000 1,300,621 1,218,101
Public safety 684,499 — 684,499 589,703
Community and economic development 96,570 — 96,570 109,521
Service district maintenance 587,707 — 587,707 475,248
Capital outlay:
Schools — 2,958,053 2,958,053 227,474
General 1,203,024 826,432 2,029,456 1,086,817
Total expenditures 3,347,421 4,309,485 7,656,906 3,706,864
Excess (deficiency) of revenues
over expenditures (651,275) (2,152,743) (2,804,018) 3,066,857
Other financing sources (uses):
Land sales proceeds 224,902 — 224,902 145,820
Proceeds from sale of capital assets — — — 140,000
Bond issuance — — — —
Premium on bonds issued — — — —
Transfers in 10,000 621,063 631,063 698,656
Transfers out (207,000) — (207,000) (1,495,644)
Net other financing sources (uses) 27,902 621,063 648,965 (511,168)
Change in fund balances (623,373) (1,531,680) (2,155,053) 2,555,689
Fund balances, at beginning of year 4,921,317 6,943,672 11,864,989 5,316,947
Fund balances, at end of year $ 4,297,944 5,411,992 9,709,936 7,872,636
Totals
95
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 $ 79,301 569,632 37,504 172,509 734,259 125,301 32,391 5,923 —
Receivables:
State of Alaska — — — — — — — — 10,663
Federal government 154,762 — — — — — — — —
Property taxes 12,370 3,188 2,075 381 10,328 6,377 410 — —
Land sales contracts, due within one year — — — — — — — — —
Other 766 — — — — — — — —
Prepaid items — — — — — — — — —
Land sale contracts, due after one year — — — — — — — — —
Total $ 247,199 572,820 39,579 172,890 744,587 131,678 32,801 5,923 10,663
Liabilities:
Accounts payable $32,106 3,726 — — 49,925 17,749 — — 1,538
Customer deposits — 1,450 — — — — — — —
Due to other funds 27,041 135 — — 1,381 — — — 9,125
Unearned revenues 2,231 — — — — — — — —
Total liabilities 61,378 5,311 — — 51,306 17,749 — — 10,663
Deferred inflows of resources:
Unavailable revenues — — — — — — — — —
Total liabilities and deferred
inflows of resources 61,378 5,311 — — 51,306 17,749 — — 10,663
Fund balances:
Nonspendable — — — — — — — — —
Committed 185,821 567,509 39,579 172,890 693,281 113,929 32,801 5,923 —
Total fund balances 185,821 567,509 39,579 172,890 693,281 113,929 32,801 5,923 —
Total $ 247,199 572,820 39,579 172,890 744,587 131,678 32,801 5,923 10,663
(continued)
Liabilities, Deferred Inflows of Resources,
and Fund Balances
State Grant
Program
Assets
Fire and Road Service Areas
Road
KODIAK ISLAND BOROUGH
Combining Balance Sheet
Nonmajor Special Revenue Funds
(With summarized financial information at June 30, 2017)
June 30, 2018
96
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 2018 2017
Equity in central treasury $ 1,363,400 813,107 31,597 28,780 189,301 60,182 4,243,187 4,653,300
Receivables:
State of Alaska — — — — — — 10,663 8,368
Federal government — — — — — — 154,762 —
Property taxes — — 15 — — — 35,144 31,450
Land sales contracts, due within one year 17,970 — — — — — 17,970 24,135
Other 15,530 846 — — 30,318 — 47,460 56,117
Prepaid items — 4 — — — — 4 419,212
Land sale contracts, due after one year 169,875 — — — — — 169,875 360,657
Total $ 1,566,775 813,957 31,612 28,780 219,619 60,182 4,679,065 5,553,239
Liabilities:
Accounts payable $4,433 24,407 388 151 4,188 — 138,611 211,312
Customer deposits 1,000 — — — — — 2,450 27,450
Due to other funds 7,038 5,248 — — — 16 49,984 8,368
Unearned revenues — — — — — — 2,231 —
Total liabilities 12,471 29,655 388 151 4,188 16 193,276 247,130
Deferred inflows of resources:
Unavailable revenues 187,845 — — — — — 187,845 384,792
Total liabilities and deferred
inflows of resources 200,316 29,655 388 151 4,188 16 381,121 631,922
Fund balances:
Nonspendable — 4 — — — — 4 419,212
Committed 1,366,459 784,298 31,224 28,629 215,431 60,166 4,297,940 4,502,105
Total fund balances 1,366,459 784,302 31,224 28,629 215,431 60,166 4,297,944 4,921,317
Total $ 1,566,775 813,957 31,612 28,780 219,619 60,182 4,679,065 5,553,239
Liabilities, Deferred Inflows of Resources,
and Fund Balances
June 30, 2018
(With summarized financial information at June 30, 2017)
Street Lighting Districts
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Combining Balance Sheet, (continued)
97
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 $ 597,762 101,828 16,701 61,814 400,031 196,222 13,879 — —
Transient accommodations tax — — — — — — — — —
Intergovernmental -
State sources 3,522 — — — — — — — 15,500
Federal sources 159,846 — — — — — — — —
Charges for services — 15,366 — — — — — — —
Licenses, permits and fees — — — — — 27,600 — — —
Investment income 843 2,913 192 807 10,862 551 147 30 —
Rental — 14,400 — — — — — — —
Other 1,030 100 — — — — — — —
Total revenues 763,003 134,607 16,893 62,621 410,893 224,373 14,026 30 15,500
Expenditures:
Current:
General government — — — — — — — — —
Public safety 565,491 88,142 15,366 — — — — — 15,500
Community and economic
development — — — — — — — — —
Service district maintenance — — — 23,259 364,570 194,662 4,575 — —
Capital outlay - general 1,123,974 79,050 — — — — — — —
Total expenditures 1,689,465 167,192 15,366 23,259 364,570 194,662 4,575 — 15,500
Excess (deficiency) of revenues
over expenditures (926,462) (32,585) 1,527 39,362 46,323 29,711 9,451 30 —
Other financing sources (uses):
Land sale proceeds — — — — — — — — —
Proceeds from sale of capital assets — — — — — — — — —
Transfers in — — — — — — — — —
Transfers out — — — — — (25,000) — — —
Net other financing sources (uses) — — — — — (25,000) — — —
Change in fund balances (926,462) (32,585) 1,527 39,362 46,323 4,711 9,451 30 —
Fund balances, at beginning of year 1,112,283 600,094 38,052 133,528 646,958 109,218 23,350 5,893 —
Fund balances, at end of year $185,821 567,509 39,579 172,890 693,281 113,929 32,801 5,923 —
(continued)
Fire and Road Service Areas
Road
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Year ended June 30, 2018
(With summarized financial information for the year ended June 30, 2017)
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
98
Woodland Acres Trinity Islands
Buildings and Street Light Street Light Tourism Mission Lake Totals
Land Sales Grounds Service Area Service Area Development Tide Gate 2018 2017
Revenues:
Property taxes and assessments $ — — 5,241 2,498 — 6,192 1,402,168 1,384,642
Transient accommodations tax — — — — 113,486 — 113,486 108,050
Intergovernmental - —
State sources 2,467 2,121 — — 37,625 — 61,235 55,788
Federal sources — — — — — — 159,846 7,497
Charges for services 12,879 848,390 — — — — 876,635 790,882
Licenses, permits and fees 9,710 — — — — — 37,310 2,125,324
Investment income 7,173 4,635 160 147 976 298 29,734 25,941
Rental — — — — — — 14,400 14,160
Other 80 122 — — — — 1,332 6,335
Total revenues 32,309 855,268 5,401 2,645 152,087 6,490 2,696,146 4,518,619
Expenditures:
Current:
General government 351,421 417,734 4,671 1,795 — — 775,621 1,100,518
Public safety — — — — — — 684,499 589,703
Community and economic
development — — — — 96,570 — 96,570 109,521
Service district maintenance — — — — — 641 587,707 475,248
Capital outlay - general — — — — — — 1,203,024 —
Total expenditures 351,421 417,734 4,671 1,795 96,570 641 3,347,421 2,274,990
Excess (deficiency) of revenues
over expenditures (319,112) 437,534 730 850 55,517 5,849 (651,275) 2,243,629
Other financing sources (uses):
Land sales proceeds 224,902 — — — — — 224,902 145,820
Proceeds from sale of capital assets — — — — — — — 140,000
Transfers in — 10,000 — — — — 10,000 75,831
Transfers out — (137,000) — — (45,000) — (207,000) (1,165,742)
Net other financing sources (uses) 224,902 (127,000) — — (45,000) — 27,902 (804,091)
Change in fund balances (94,210) 310,534 730 850 10,517 5,849 (623,373) 1,439,538
Fund balances, at beginning of year 1,460,669 473,768 30,494 27,779 204,914 54,317 4,921,317 3,481,779
Fund balances, at end of year $1,366,459 784,302 31,224 28,629 215,431 60,166 4,297,944 4,921,317
KODIAK ISLAND BOROUGH
Nonmajor Special Revenue Funds
Street Lighting Districts
Combining Statement of Revenues, Expenditures,
Year ended June 30, 2018
and Changes in Fund Balances, (continued)
(With summarized financial information for the year ended June 30, 2017)
99
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, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 602,013 597,762 (4,251) 588,587
Intergovernmental:
State sources - PERS on behalf payment — 3,522 3,522 4,620
Federal sources 154,752 159,846 5,094 7,497
Investment income — 843 843 4,393
Other 1,500 1,030 (470) 4,425
Total revenues 758,265 763,003 4,738 609,522
Expenditures:
Public safety:
Personnel 116,000 117,880 (1,880) 112,159
Volunteers 40,000 28,260 11,740 29,130
Fringe benefits 87,336 84,469 2,867 79,197
Professional services — 10,502 (10,502) 24,658
Support goods and services 301,500 324,380 (22,880) 240,131
Total public safety 544,836 565,491 (20,655) 485,275
Capital outlay - general 678,520 1,123,974 (445,454) 8,159
Total expenditures 1,223,356 1,689,465 (466,109) 493,434
Excess (deficiency) of revenues
over expenditures (465,091) (926,462) (461,371) 116,088
Other financing sources:
Proceeds from sale of capital assets — — — 140,000
Transfers in — — — 57,493
Net other financing sources — — — 197,493
Change in fund balance $(465,091) (926,462) (461,371) 313,581
Fund balance, at beginning of year 1,112,283 798,702
Fund balance, at end of year $ 185,821 1,112,283
2018
100
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 102,939 101,828 (1,111) 101,077
Charges for services 17,211 15,366 (1,845) 14,716
Investment income 1,000 2,913 1,913 2,853
Rental 12,000 14,400 2,400 14,160
Other 80 100 20 350
Total revenues 133,230 134,607 1,377 133,156
Expenditures:
Public safety:
Personnel services 7,000 1,674 5,326 1,040
Fringe benefits 3,000 801 2,199 724
Professional services — 5,746 (5,746) 4,489
Support goods and services 113,930 79,921 34,009 61,523
Total public safety 123,930 88,142 35,788 67,776
Capital outlay - general 134,300 79,050 55,250 —
Total expenditures 258,230 167,192 91,038 67,776
Excess (deficiency) of revenues
over expenditures $(125,000) (32,585) 92,415 65,380
Fund balance, at beginning of year 600,094 534,714
Fund balance, at end of year $ 567,509 600,094
2018
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, 2018
(With financial information for the year ended June 30, 2017)
101
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 16,741 16,701 (40) 15,366
Investment income 500 192 (308) 211
Total revenues 17,241 16,893 (348) 15,577
Expenditures:
Public safety:
Support goods and services 17,241 15,366 1,875 14,737
Excess of revenues over
expenditures $— 1,527 1,527 840
Fund balance, at beginning of year 38,052 37,212
Fund balance, at end of year $ 39,579 38,052
102
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 62,673 61,814 (859) 62,162
Investment income — 807 807 650
Total revenues 62,673 62,621 (52) 62,812
Expenditures:
Service district maintenance:
Personnel services 500 60 440 315
Fringe benefits — 17 (17) 204
Support goods and services 5,023 80 4,943 81
Snow removal/sanding 28,150 10,254 17,896 11,126
Road grading/ditching 13,000 10,285 2,715 1,414
Repairs and maintenance 16,000 2,563 13,437 6,929
Total expenditures 62,673 23,259 39,414 20,069
Excess of revenues over
expenditures $— 39,362 39,362 42,743
Fund balance, at beginning of year 133,528 90,785
Fund balance, at end of year $ 172,890 133,528
103
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, 2018
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 401,792 400,031 (1,761) 394,545
Investment income — 10,862 10,862 3,218
Total revenues 401,792 410,893 9,101 397,763
Expenditures:
Service district maintenance:
Personnel services 8,800 5,865 2,935 6,038
Fringe benefits 2,900 1,291 1,609 1,415
Support goods and services 2,600 13,429 (10,829) 685
Snow removal/sanding 200,000 80,237 119,763 62,934
Road grading/ditching 60,000 47,140 12,860 32,493
Repairs and maintenance 194,700 216,608 (21,908) 56,312
Total expenditures 469,000 364,570 104,430 159,877
Excess (deficiency) of revenues
over expenditures $(67,208) 46,323 113,531 237,886
Fund balance, at beginning of year 646,958 409,072
Fund balance, at end of year $ 693,281 646,958
(With financial information for the year ended June 30, 2017)
104
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $198,466 196,222 (2,244) 194,901
Licenses, permits and fees 27,000 27,600 600 27,600
Investment income — 551 551 811
Total revenues 225,466 224,373 (1,093) 223,312
Expenditures:
Service district maintenance:
Personnel services 500 274 226 81
Fringe benefits — 177 (177) 24
Support goods and services 34,966 273 34,693 287
Snow removal/sanding 60,000 31,919 28,081 73,174
Road grading/ditching 40,000 72,102 (32,102) 51,915
Repairs and maintenance 90,000 89,917 83 164,007
Total expenditures 225,466 194,662 30,804 289,488
Excess (deficiency) of revenues
over expenditures — 29,711 29,711 (66,176)
Other financing sources:
Transfers out -
Other Capital Projects Capital Project Fund (25,000) (25,000) — —
Change in fund balance $ (25,000) 4,711 29,711 (66,176)
Fund balance, at beginning of year 109,218 175,394
Fund balance, at end of year $ 113,929 109,218
105
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $13,879 13,879 — 14,256
Investment income — 147 147 110
Total revenues 13,879 14,026 147 14,366
Expenditures:
Service district maintenance:
Personnel services — 48 (48) 246
Fringe benefits — 14 (14) 151
Professional services 5,879 — 5,879 —
Support goods and services — — — 20
Snow removal/sanding 5,400 1,901 3,499 3,891
Road grading/ditching 1,100 1,891 (791) 497
Repairs and maintenance 1,500 721 779 541
Total expenditures 13,879 4,575 9,304 5,346
Excess of revenues over
expenditures $— 9,451 9,451 9,020
Fund balance, at beginning of year 23,350 14,330
Fund balance, at end of year $ 32,801 23,350
106
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Investment income $100 30 (70) 29
Expenditures:
Service district maintenance:
Support services 100 — 100 —
Excess of revenues over
expenditures $— 30 30 29
Fund balance, at beginning of year 5,893 5,864
Fund balance, at end of year $ 5,923 5,893
107
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources – grants $15,812 15,500 (312) 13,756
Expenditures:
Public safety:
Personnel services 7,811 6,374 1,437 7,299
Fringe benefits 4,916 4,474 442 4,795
Support goods and services 3,085 4,652 (1,567) 1,662
Total expenditures 15,812 15,500 312 13,756
Excess of revenues
over expenditures — — — —
Other financing sources:
Transfers in - General Fund — — — 18,338
Change in fund balance $— — — 18,338
Fund (deficit), at beginning of year — (18,338)
Fund, at end of year $ — —
108
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources - PERS on behalf payment $3,650 2,467 (1,183) 3,780
Charges for services 5,000 12,879 7,879 24,488
Licenses, permits and fees 6,750 9,710 2,960 2,097,724
Investment income 6,300 7,173 873 8,173
Other 500 80 (420) 1,441
Total revenues 22,200 32,309 10,109 2,135,606
Expenditures:
General government:
Personnel services 84,000 87,486 (3,486) 115,924
Fringe benefits 52,867 54,028 (1,161) 56,034
Professional services 215,000 176,656 38,344 319,111
Support goods and services 113,736 33,251 80,485 61,588
Total expenditures 465,603 351,421 114,182 552,657
Excess (deficiency) of revenues
over expenditures (443,403) (319,112) 124,291 1,582,949
Other financing sources (uses):
Land sale proceeds 200,000 224,902 24,902 145,820
Transfers out:
Hospital Facilities Enterprise Fund — — — (650,000)
Net other financing sources (uses) 200,000 224,902 24,902 (504,180)
Change in fund balance $(243,403) (94,210) 149,193 1,078,769
Fund balance, at beginning of year 1,460,669 381,900
Fund balance, at end of year $ 1,366,459 1,460,669
109
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Intergovernmental:
State sources - PERS on behalf payment $6,126 2,121 (4,005) 2,745
Charges for services 833,467 848,390 14,923 751,678
Investment income 3,050 4,635 1,585 3,632
Other — 122 122 119
Total revenues 842,643 855,268 12,625 758,174
Expenditures:
General government:
School buildings 51,077 31,142 19,935 6,627
Borough building 733,486 359,036 374,450 523,951
Mental health center 43,080 24,371 18,709 6,608
Various borough buildings 15,000 3,185 11,815 4,065
Total expenditures 842,643 417,734 424,909 541,251
Excess of revenues over expenditures — 437,534 437,534 216,923
Other financing sources:
Transfers in - Facilities Special Revenue Fund — 10,000 10,000 —
Transfers out - Renewal and Replacement Projects
Capital Project Fund (137,000) (137,000) — (336,370)
Net other financing sources (uses)(137,000) (127,000) 10,000 (336,370)
Change in fund balance $ (137,000) 310,534 447,534 (119,447)
Fund balance, at beginning of year 473,768 593,215
Fund balance, at end of year $ 784,302 473,768
110
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, 2018
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 5,269 5,241 (28) 5,155
Investment income 200 160 (40) 153
Total revenues 5,469 5,401 (68) 5,308
Expenditures:
General government:
Support goods and services 5,469 4,671 798 4,817
Excess of revenues over
expenditures $— 730 730 491
Fund balance, at beginning of year 30,494 30,003
Fund balance, at end of year $ 31,224 30,494
(With financial information for the year ended June 30, 2017)
111
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 2,498 2,498 — 2,446
Investment income — 147 147 136
Total revenues 2,498 2,645 147 2,582
Expenditures:
General government:
Support goods and services 2,498 1,795 703 1,793
Excess of revenues over
expenditures $— 850 850 789
Fund balance, at beginning of year 27,779 26,990
Fund balance, at end of year $ 28,629 27,779
112
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Transient accommodations tax $ 94,000 113,486 19,486 108,050
Intergovernmental - State sources -
Commerical passenger vessel tax 30,500 37,625 7,125 30,887
Investment income 950 976 26 948
Total revenues 125,450 152,087 26,637 139,885
Expenditures:
Community and economic development:
Contributions 87,000 96,501 (9,501) 109,521
Support goods and services — 69 (69) —
Total expenditures 87,000 96,570 (9,570) 109,521
Excess of revenues
over expenditures 38,450 55,517 17,067 30,364
Other financing sources (uses) -
Transfers out - Kodiak Fisheries Research
Center Enterprise Fund (45,000) (45,000) — (45,000)
Change in fund balance $(6,550) 10,517 17,067 (14,636)
Fund balance, at beginning of year 204,914 219,550
Fund balance, at end of year $ 215,431 204,914
113
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, 2018
(With financial information for the year ended June 30, 2017)
2018
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Revenues:
Property taxes and assessments $ 6,198 6,192 (6) 6,147
Investment income — 298 298 259
Total revenues 6,198 6,490 292 6,406
Expenditures:
Service district maintenance:
Personnel services 150 383 (233) 255
Fringe benefits 98 251 (153) 205
Contracted services 5,850 — 5,850 —
Support goods and services 100 7 93 8
Total expenditures 6,198 641 5,557 468
Excess of revenues
over expenditures $— 5,849 5,849 5,938
Fund balance, at beginning of year 54,317 48,379
Fund balance, at end of year $ 60,166 54,317
114
NONMAJOR CAPITAL PROJECT FUNDS
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.
The School Renewal and Replacement Facilities Bond Projects accounts for
construction and maintenance for the borough’s educational facilities funded by
bonds.
KODIAK ISLAND BOROUGH
Nonmajor Capital Project Funds
Combining Balance Sheet
June 30, 2018
School Renewal
Borough School Bond State Kodiak High Renewal and Other and Replacement
Capital Capital Capital School Replacement Capital Facilities Bond
Assets Projects Projects Grants Renovation Projects Projects Projects 2018 2017
Equity in central treasury $112,711 666,634 424,091 359,266 1,245,489 2,607,150 2,094,606 7,509,947 3,750,355
Receivables:
State of Alaska — — 613 — — — — 613 1,063
Federal government — — — — — 76,808 — 76,808 49,923
Property taxes — — — — 35,714 — — 35,714 —
Accounts and other receivables, net — — 3,153 — 51,034 — — 54,187 23,367
Total $ 112,711 666,634 427,857 359,266 1,332,237 2,683,958 2,094,606 7,677,269 3,824,708
Liabilities and Fund Balances (Deficit)
Liabilities:
Accounts payable — — — 535,432 9,744 81,128 948,794 1,575,098 48,227
Due to other funds — 653,783 — — 528 688 4,250 659,249 794,232
Unearned revenues — — — — — 30,930 — 30,930 30,930
Total liabilities — 653,783 — 535,432 10,272 112,746 953,044 2,265,277 873,389
Fund balances (deficit):
Assigned 112,711 12,851 427,857 — 1,321,965 2,571,212 1,141,562 5,588,158 3,073,997
Unassigned — — — (176,166) — — — (176,166) (122,678)
Total fund balances (deficit) 112,711 12,851 427,857 (176,166) 1,321,965 2,571,212 1,141,562 5,411,992 2,951,319
Total $ 112,711 666,634 427,857 359,266 1,332,237 2,683,958 2,094,606 7,677,269 3,824,708
Totals
(With summarized financial information at June 30, 2017)
115
KODIAK ISLAND BOROUGH
Nonmajor Capital Project Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit)
Year ended June 30, 2018
School Renewal
Borough School Bond State Kodiak High Renewal and Other and Replacement
Capital Capital Capital School Replacement Capital Facilities Bond
Projects Projects Grants Renovation Projects Projects Projects 2018 2017
Revenues:
Property taxes and assessments $— — — — 1,736,076 — — 1,736,076 1,402,533
Intergovernmental:
State sources — — 2,870 — — — — 2,870 36,647
Federal sources — — — — — 93,828 — 93,828 798,846
Investment income (loss)(308) 8,511 3,415 1,976 — 10,939 15,074 39,607 17,076
Other — — — — 284,361 — — 284,361 —
Total revenues (308) 8,511 6,285 1,976 2,020,437 104,767 15,074 2,156,742 2,255,102
Expenditures:
General government — — — 525,000 — — — 525,000 117,583
Capital outlay:
Schools — — — 92,188 — — 2,865,865 2,958,053 227,474
General — — 3,945 — 630,899 191,588 — 826,432 1,086,817
Total expenditures — — 3,945 617,188 630,899 191,588 2,865,865 4,309,485 1,431,874
Excess (deficiency) of revenues
over expenditures (308) 8,511 2,340 (615,212) 1,389,538 (86,821) (2,850,791) (2,152,743) 823,228
Other financing sources (uses):
Transfers in — — — — 55,105 565,958 — 621,063 622,825
Transfers out — — — — — — — — (329,902)
Net other financing sources (uses)— — — — 55,105 565,958 — 621,063 292,923
Change in fund balances (308) 8,511 2,340 (615,212) 1,444,643 479,137 (2,850,791) (1,531,680) 1,116,151
Fund balances (deficit), at beginning of year 113,019 4,340 425,517 439,046 (122,678) 2,092,075 3,992,353 6,943,672 1,835,168
Fund balances (deficit), at end of year $112,711 12,851 427,857 (176,166) 1,321,965 2,571,212 1,141,562 5,411,992 2,951,319
Totals
(With summarized financial information for the year ended June 30, 2017)
116
ENTERPRISE FUNDS
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, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Operating revenues:
Solid waste disposal $3,692,925 3,813,343 120,418 3,105,560
Other 5,000 1,434 (3,566) 11,390
Total operating revenues 3,697,925 3,814,777 116,852 3,116,950
Operating expenses:
Personnel services 1,597,682 1,117,408 480,274 1,319,809
Contracted services 169,000 299,815 (130,815) 303,846
Maintenance and repairs 88,000 101,429 (13,429) 106,058
Depreciation 975,925 293,749 682,176 294,025
General and administration 467,781 450,051 17,730 463,071
Recycling services 250,000 259,824 (9,824) 252,960
Closure and postclosure costs 35,000 367,702 (332,702) 154,010
Contributions 40,000 36,383 3,617 35,880
Total operating expenses 3,623,388 2,926,361 697,027 2,929,659
Operating income (loss)74,537 888,416 813,879 187,291
Other income (expense):
Intergovernmental:
State of Alaska on-behalf payment 36,703 35,503 (1,200) 20,887
Investment income 36,500 32,435 (4,065) 30,576
Interest expense (197,740) (319,165) (121,425) (367,158)
Total other income (expense)(124,537) (251,227) (126,690) (315,695)
Change in net position $ (50,000) 637,189 687,189 (128,404)
Net position, at beginning of year, as originally stated 15,143,324 15,271,728
Cumulative effect of a change in accounting principle (212,353) —
Net position, at beginning of year, as restated 14,930,971 15,271,728
Net position, at end of year $ 15,568,160 15,143,324
Enterprise Funds
2018
117
KODIAK ISLAND BOROUGH
Hospital Facilities
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Operating revenues:
Lease income $1,384,272 1,384,272 — 660,000
Operating expenses:
Personnel services 34,000 34,000 — 42,436
General and administration 871,016 22,818 848,198 12,510
Miscellaneous — 270,109 (270,109) —
Depreciation 1,162,618 1,085,223 77,395 1,121,711
Total operating expenses 2,067,634 1,412,150 655,484 1,176,657
Operating income (loss)(683,362) (27,878) 655,484 (516,657)
Other income (expense):
Investment income 129,000 23,850 (105,150) 136,828
Contribution to Providence Hospital — — — (108,000)
Total other income (expense)129,000 23,850 (105,150) 28,828
Income (loss) before transfers
and special item (554,362) (4,028) 550,334 (487,829)
Transfers in — — — 1,089,372
Transfers out (726,000) — 726,000 (8,062,822)
Total transfers (726,000) — 726,000 (6,973,450)
Special item:
Gain on transfer of Long Term
Care Center operations (Note 20)— — — 1,721,113
Change in net position $(1,280,362) (4,028) 1,276,334 (5,740,166)
Net position, at beginning of year 15,972,683 21,712,849
Net position, at end of year $ 15,968,655 15,972,683
Enterprise Funds
2018
118
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Operating revenues:
Lease income $1,143,322 1,093,475 (49,847) 1,119,929
Other — — — 16,623
Total operating revenue 1,143,322 1,093,475 (49,847) 1,136,552
Operating expenses:
Insurance and bonding 18,700 16,040 2,660 43,536
Legal fees — — — 113
Miscellaneous 438,634 — 438,634 —
Depreciation — 518,933 (518,933) 518,933
Total operating expenses 457,334 534,973 (77,639) 562,582
Operating income 685,988 558,502 (127,486) 573,970
Other income (expense):
Investment income — 2,753 2,753 75
Interest expense (685,988) (473,059) 212,929 (553,977)
Debt issuance costs — — — (11,500)
Loss on advanced refunding of debt — — — (54,590)
Total other income (expense)(685,988) (470,306) 215,682 (619,992)
Income (loss) before transfers
and special item — 88,196 88,196 (46,022)
Transfers in — — — 8,062,822
Special item:
Loss on transfer of Long Term
Care Center operations (Note 20)— — — (1,721,113)
Change in net position $— 88,196 88,196 6,295,687
Net position, at beginning of year 6,295,687 —
Net position, at end of year $ 6,383,883 6,295,687
KODIAK ISLAND BOROUGH
2018
Year ended June 30, 2018
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, 2017)
119
KODIAK ISLAND BOROUGH
Kodiak Fisheries Research Center
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Operating revenues:
Lease income $ 903,815 826,647 (77,168) 847,642
Operating expenses:
Personnel services 297,799 294,919 2,880 386,036
Maintenance and repairs 41,000 56,037 (15,037) 57,869
Depreciation 667,071 698,482 (31,411) 702,501
General and administration:
Support goods and services 167,500 10,351 157,149 11,529
Cleaning and janitorial 64,000 61,444 2,556 55,750
Heating 101,500 87,610 13,890 84,106
Electrical 151,800 136,858 14,942 165,171
Plumbing 63,500 64,099 (599) 59,677
Air conditioning 2,000 981 1,019 42
Elevators 2,500 2,250 250 1,800
Miscellaneous 65,150 9,306 55,844 7,529
Total operating expenses 1,623,820 1,422,337 201,483 1,532,010
Operating income (loss) (720,005) (595,690) (124,315) (684,368)
Other income:
State of Alaska on-behalf payment 6,392 9,006 2,614 6,912
Investment income 38,000 10,833 (27,167) 10,372
Interest revenue 55,214 55,214 — 59,134
Total other income 99,606 75,053 (24,553) 76,418
Income (loss) before transfers (620,399) (520,637) 99,762 (607,950)
Transfers in 45,000 45,000 — 45,000
Change in net position $(575,399) (475,637) 99,762 (562,950)
Net position, at beginning of year, as originally stated 12,270,750 12,833,700
Cumulative effect of a change in accounting principle (52,008) —
Net position, at beginning of year, as restated 12,218,742 12,833,700
Net position, at end of year $ 11,743,105 12,270,750
Enterprise Funds
2018
120
KODIAK ISLAND BOROUGH
Enterprise Funds
Schedule of Revenues, Expenses, and
Changes in Net Position
Budget and Actual
Year ended June 30, 2018
(With financial information for the year ended June 30, 2017)
Variance with
Final Budget
Final Positive 2017
Budget Actual (Negative)Actual
Operating revenues:
Customer charges $240,000 255,617 15,617 28,409
Operating expenses:
Personnel services 1,500 1,500 — 1,500
Insurance & bonding 100 133 (33) 53
Telephone services 238,400 253,984 (15,584) 26,856
Total operating expenses 240,000 255,617 (15,617) 28,409
Operating income $— — — —
Net position, at beginning of year — —
Net position, at end of year $ — —
2018
911 Service Fund
121
SUPPLEMENTARY SCHEDULES
Fiscal Year Principal Interest Total
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
70,210,000$ 26,327,439$ 96,537,439$
SUMMARY OF BONDED DEBT SERVICE REQUIREMENTS TO MATURITY
KODIAK ISLAND BOROUGH
June 30, 2018
Annual principal and interest requirements on General Obligation Bonds.
122
Fiscal year Interest rate
Interest due
September 01
Principal due
April 01
Interest due
March 01 Total
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
1,116,053$ 5,880,000$ 1,116,053$ 8,112,106$
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, 2018
2011 Series One
123
Fiscal Year
Interest
Rate
Interest Due
September 1
Principal Due
September 1
Interest due
March 1 Total
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
388,825$ 3,845,000$ 297,825$ 4,531,650$
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, 2018
2012 Series A
124
Fiscal Year
Interest
Rate
Interest Due
September 1
Principal Due
September 1
Interest due
March 1 Total
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
474,525$ 4,695,000$ 363,400$ 5,532,925$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2018
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
125
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
February 01
Interest due
February 01 Total
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
3,741,425$ 17,860,000$ 3,741,425$ 25,342,850$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2018
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
126
Fiscal Year
Interest
Rate
Interest Due
September 01
Principal Due
March 01
Interest Due
March 01 Total
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
4,445,720$ 19,485,000$ 4,445,970$ 28,376,690$
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, 2018
2014 Series One
127
Fiscal Year
Interest
Rate
Interest Due
October 01
Principal Due
October 01
Interest Due
April 01 Total
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
1,591,503$ 5,815,000$ 1,446,297$ 8,852,800$
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION BONDS
RETIREMENT SCHEDULE
June 30, 2018
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
128
Fiscal Year
Interest
Rate
Interest Due
October 01
Principal Due
October 01
Interest Due
April 01 Total
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
176,350$ 1,485,000$ 140,000$ 1,801,350$
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, 2018
2015 Series Three
129
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
August 01
Interest Due
February 01 Total
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
318,301$ 1,775,000$ 284,717$ 2,378,018$
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, 2018
130
Fiscal Year
Interest
Rate
Interest Due
August 01
Principal Due
August 01
Interest Due
February 01 Total
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
531,500$ 4,465,000$ 419,875$ 5,416,375$
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, 2018
131
Fiscal Year
Interest
Rate
Interest Due
December 01
Principal Due
December 01
Interest Due
June 01 Total
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
700,925$ 4,905,000$ 586,750$ 6,192,675$
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, 2018
132
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. 133-137
Revenue Capacity
These schedules contain information to help the reader assess the govern-
ment’s most significant local revenue source, the property tax. 138-141
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. 142-146
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. 147-153
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports
for the revelant year.
2009 2010 2011 2012 2013
Governmental activities:
Net investment in capital assets $ 71,534,766 $ 77,447,045 $ 81,789,375 $ 85,285,497 $ 72,773,598
Unrestricted 48,140,406 48,992,902 47,094,977 48,265,320 47,149,835
Total governmental activities net assets $119,675,172 $126,439,947 $128,884,352 $133,550,817 $119,923,433
Business-type activities:
Net investment in capital assets $ 38,135,340 $ 36,655,859 $ 35,170,143 $ 31,967,945 $ 21,628,143
Unrestricted (2,939,301) (598,367) 1,137,826 4,532,561 20,750,321
Total business-type activities net assets $35,196,039 $36,057,492 $36,307,969 $36,500,506 $42,378,464
Primary government:
Net investment in capital assets $ 115,582,385 $ 118,445,234 $ 116,959,518 $ 117,253,442 $ 94,401,741
Unrestricted 46,053,601 46,496,610 48,232,803 52,797,881 67,900,156
Total primary government net assets $154,871,211 $162,497,439 $165,192,321 $170,051,323 $162,301,897
2014 2015 2016 2017 2018
Governmental activities:
Net investment in capital assets $ 80,159,521 $ 82,616,865 $ 80,747,617 $ 80,857,151 $ 85,569,631
Unrestricted 46,754,461 43,472,334 47,678,271 48,293,582 46,105,327
Total governmental activities net assets $126,913,982 $126,089,199 $128,425,888 $129,150,733 $131,674,958
Business-type activities:
Net investment in capital assets $ 36,383,229 $ 43,884,340 $ 37,381,997 $ 40,098,010 $ 39,508,817
Unrestricted 12,115,258 5,239,974 12,436,280 9,584,434 10,154,986
Total business-type activities net assets $48,498,487 $49,124,314 $49,818,277 $49,682,444 $49,663,803
Primary government:
Net investment in capital assets $ 116,542,750 $ 126,501,205 $ 118,129,614 $ 120,955,161 $ 125,078,448
Unrestricted 58,869,719 48,712,308 60,114,551 57,878,016 56,260,313
Total primary government net assets $175,412,469 $175,213,513 $178,244,165 $178,833,177 $181,338,761
Source: Borough general ledger
Fiscal Year
Fiscal Year
KODIAK ISLAND BOROUGH
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
133
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Expenses
Governmental activities:
General government $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 $ 6,995,624
Public safety 579,710 612,763 664,349 622,396 644,197 751,637 663,145 798,079 1,028,240 953,898
Community and economic development 908,501 1,034,686 1,211,189 1,195,237 1,070,991 964,377 886,613 1,167,367 1,136,303 1,152,197
Emergency preparedness 14,988 10,511 11,705 21,423 278,480 12,487 31,628 30,849 35,861 43,038
Health and social services 371,673 406,087 392,011 391,996 290,800 326,700 406,093 389,000 233,999 207,500
Education, culture, and recreation 248,571 192,182 85,690 64,289 84,273 218,013 335,854 2,996,004 17,562 4,665
Parks and recreation - - 13,625 5,825 21,100 37,795 161,596 87,456 30,172 77,186
Service district maintenance 398,219 543,897 593,388 705,665 479,264 631,572 534,376 626,289 475,248 587,707
Primary and secondary education 12,354,129 12,423,691 12,834,349 11,998,842 13,930,919 14,523,509 14,316,695 11,225,022 14,162,868 12,695,233
Interest on long-term debt 1,408,045 1,336,068 1,508,052 1,188,945 1,254,225 2,109,406 3,063,649 3,194,612 3,060,520 2,673,238
Total governmental activities expenses 20,007,800 21,039,300 22,423,590 20,476,001 25,453,148 26,566,136 26,036,888 28,365,666 27,336,860 25,390,286
Business-type activities:
Municipal solid waste collection and disposal 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 3,245,526
Hospital facilities 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 1,412,150
Long Term Care Center - - - - - - - - 1,128,059 1,008,032
Kodiak Fisheries Research Center 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 1,422,337
911 services 43,043 42,474 53,041 2,615 87,596 39,817 33,961 30,417 28,409 255,617
Total business-type activities expenses 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 7,343,662
Total primary government expenses $26,958,940 $28,327,522 $27,543,805 $25,588,202 30,748,847 32,108,453 31,789,163 36,774,760 34,606,812 32,733,948
Program Revenues
Governmental activities:
Charges for services:
General government $705,166 $703,431 $658,463 $673,050 $ 549,100 $ 577,350 $ 540,052 $ 682,664 $ 2,874,794 $ 873,043
Public safety 12,361 12,762 33,755 11,646 13,849 14,336 13,601 16,610 14,716 15,366
Community and economic development - - - - - - - - - -
Health and sanitation - - - - - - - - - -
Education, culture, and recreation - - - - - - - - - -
Service district maintenance 25,000 25,000 27,600 1 94,076 110,313 114,516 66,151 111,146 90,450
Primary and secondary education - - - - - - - - - -
Operating grants and contributions 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 5,614,105
Capital grants 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 96,698
Total governmental activities program revenues 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 6,689,662
Business-type activities:
Charges for services:
Municipal solid waste collection and disposal 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 3,813,343
Hospital facilities 3,575,835 1,867,990 720,000 720,000 720,000 1,150,000 1,759,789 1,959,827 660,000 1,384,272
Long Term Care Center - - - - - - - - 1,119,929 1,093,475
Kodiak Fisheries Research Center 1,598,260 1,610,775 2,018,747 1,636,728 1,603,503 1,851,322 2,267,032 3,353,718 847,642 826,647
911 services 52,654 42,474 53,041 - - - - - - -
Operating grants and contributions - - - 75,819 85,634 - 32,649 428,578 27,799 44,509
Capital grants - - - 97,534 5,984,095 5,538,038 213,753 11,326 - -
Total business-type activities program revenues 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 7,162,246
Total primary government program revenues $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 $ 13,851,908
Net(expense)/revenue:
Governmental activities $(14,390,766) $(11,472,915) $(16,166,892) $(16,737,602) $ (19,665,937) $ (15,134,890) $ (18,060,095) $ (19,570,133) $ (19,223,798) $ (18,700,624)
Business-type activities 1,879,604 583,386 69,552 (280,363) 5,601,568 5,263,010 1,132,802 203,791 (1,509,022) (181,416)
Total primary government net expense $(12,511,162) $(10,889,529) $(16,097,340) $(17,017,965) $ (14,064,369) $ (9,871,880) $ (16,927,293) $ (19,366,342) $ (20,732,820) $ (18,882,040)
General Revenues and Other Changes in Net Assets
Governmental activities:
Taxes:
Property taxes $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 $ 16,045,148
Severance taxes 1,311,188 1,336,075 1,649,275 1,970,265 1,774,700 1,843,819 1,703,257 3,985,978 1,414,557 1,929,409
Tobacco excise taxes - - - - - - - - - 310,482
Unrestricted grants and contributions 4,214,617 4,089,966 3,642,009 4,199,766 4,458,203 4,142,583 3,990,192 27,683 3,631,012 3,414,671
Land sales 26,369 760 2,383 4,540 - 864,584 103,143 1,586,555 325,793 27,955
Investment earnings 2,082,615 1,219,201 713,414 1,788,903 528,676 1,106,717 574,227 604,274 271,691 281,855
Other 226,586 619,948 739,113 327,540 383,877 506,546 494,287 403,958 23,306 305,983
Transfers (765,490) (80,000) (80,000) (80,000) (80,000) (80,000) (152,357) (50,228) (1,134,372) (45,000)
Extraordinary item 1,396,222 - - - - - - 675,246 - -
Total governmental activities $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 $ 22,270,503
Business-type activities:
Investment earnings 273,973 198,067 100,925 282,027 117,702 178,851 80,825 236,180 177,851 69,871
Other 50 - - 110,442 78,688 598,162 186,328 203,764 115,556 312,265
Transfers 765,490 80,000 80,000 80,000 80,000 80,000 152,357 50,228 1,134,372 45,000
Extraordinary item 432,688 - - - - - - - (54,590) -
Total business-type activities 1,472,201 278,067 180,925 472,469 276,390 857,013 419,510 490,172 1,373,189 427,136
Total primary government $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 $ 22,697,639
Change in Net Position
Governmental activities $4,693,599 $6,764,775 $2,444,405 $4,800,964 $ 310,031 $ 6,990,549 $ 2,881,159 $ 2,077,365 $ 1,022,782 $ 3,569,879
Business-type activities 3,351,805 861,453 250,477 192,106 5,877,958 6,120,023 1,552,312 693,963 (135,833) 245,720
Total primary government $8,045,404 $7,626,228 $2,694,882 $4,993,070 $6,187,989 $13,110,572 $4,433,471 $2,771,328 $886,949 $3,815,599
KODIAK ISLAND BOROUGH
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
134
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 2018
General Fund:
Nonspendable $14,566 $26,272 $32,349 $37,885
Committed - - - -
Unassigned 3,181,342 3,259,509 2,284,775 3,151,069
Total General Fund $3,195,908 $3,285,781 $2,317,124 $3,188,954
All other governmental funds
Nonspendable $287,564 $181,191 $419,212 $4
Committed 42,606,097 43,081,680 4,502,105 43,876,363
Assigned 7,610,272 11,312,217 3,073,997 5,588,158
Unassigned (2,516,222) (1,871,193) (122,678) (302,780)
Total all other governmental funds $47,987,711 $52,703,895 $7,872,636 $49,161,745
The Kodiak Island Borough implemented GASB 54 in Fiscal Year 2011. That is why there is only nine years of data.
KODIAK ISLAND BOROUGH
Fund Balances of Governmental Funds
Last Nine Fiscal Years
(modified accrual basis of accounting)
135
Fiscal Year
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenues:
Property taxes and assessments $ 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 16,002,128
Transient accommodations tax 88,338 86,003 96,384 87,400 96,640 75,142 104,074 95,466 108,050 113,486
Intergovernmental:
State sources 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 6,975,473
Federal sources 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 2,067,113
Severance taxes 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 1,815,923
Tobacco excise taxes — — — — — — — — — 310,482
Licenses, permits, fees, and other local revenues 742,527 766,193 719,818 684,697 657,025 701,999 688,719 774,225 3,014,816 992,759
Other revenues 418,741 459,412 720,659 44,304 52,516 50,556 17,747 45,422 9,146 290,343
Investment earnings 2,088,915 1,225,938 706,677 1,857,413 536,903 1,115,466 583,677 648,987 271,691 281,855
Total revenues 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 28,849,562
Expenditures:
General government 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 5,715,946
Public safety 460,826 502,491 537,623 447,479 469,280 576,720 524,169 572,839 699,118 2,001,538
Community and economic development 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 1,177,198
Emergency preparedness 12,488 8,011 11,705 18,923 18,342 9,987 29,128 30,849 35,861 43,038
Health and sanitation department 333,747 371,321 392,011 391,996 290,800 326,700 406,093 389,000 233,999 207,500
Education, culture, and recreation 248,571 192,182 85,690 64,289 84,273 95,625 24,856 23,949 17,562 4,665
Parks and recreation — — 13,625 5,825 21,100 37,795 161,596 87,456 30,172 77,186
Service district maintenance 398,219 543,897 593,388 705,665 479,264 631,572 534,376 626,289 475,248 587,707
Primary and secondary education 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 9,449,500
Capital outlay:
Schools 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 2,958,053
General 1,277,106 4,319,438 4,839,652 562,007 2,041,674 1,521,996 2,907,018 3,430,975 1,086,817 826,432
Debt service:
Principal 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 3,870,000
Interest 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 3,408,310
Other charges - bond issuance costs 68,635 — 40,689 100,149 20,809 89,835 — 124,372 64,313 —
Total expenditures 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 30,327,073
Excess of revenues over (under) expenditures (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) (1,477,511)
Other Financing Sources (Uses):
Proceeds from sales of bonds — — 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 refunded bond escrow agent (6,865,467) — — ########### — — — — (5,934,301) 0
Proceeds from sale of assets — — — — 9,564 — — — 140,000 1,240
Land sale proceeds 30,561 138,867 15,021 10,735 6,787 356,284 329,344 110,428 145,820 224,902
Insurance proceeds — — — — — — — 403,958 — —
Transfers in 6,144,301 3,211,195 3,782,289 957,652 6,212,885 992,365 642,691 1,404,497 1,758,036 1,189,104
Transfers out (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) (1,234,104)
Total other financing sources(uses) (860,396) 58,867 7,984,254 1,328,774 24,956,170 25,363,716 176,987 17,605,273 (1,071,648) 181,142
Net change in fund balances $(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)(1,296,369)
Debt service as a percentage of noncapital expenditures % 20.56 % 19.41 % 18.53 % 27.22 % 17.62 % 22.51 % 21.71 % 23.80 % 26.84 28.08
KODIAK ISLAND BOROUGH
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
136
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
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
2018 3,198,144 62,350 3,501,872 10,830 — 6,714 6,779,910
(a) Includes General Fund only.
Source: Borough general ledger.
137
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
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
2018 1,205,698,799 1,290,502,977 137,125,100 149,553,000 1,342,823,899 1,440,055,977 10.75 93.25
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
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Last Ten Years Assessed Values
138
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
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
2018 0.62 6.80 2.03 1.30 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)
139
KODIAK ISLAND BOROUGH
Property Tax Levies and Collections
Last Ten Fiscal Years
Collections
in Subsequent
Years Amount
2009 10,231,461 10,201,209 99.7 27,835 10,229,044 100.0
2010 10,879,276 10,487,467 96.4 388,128 10,875,595 100.0
2011 11,536,758 11,499,457 99.7 98,463 11,597,920 100.5
2012 (a) 13,255,665 13,038,077 98.4 280,015 13,318,092 100.5
2013 (a) 13,581,524 13,489,190 99.3 144,567 13,633,757 100.4
2014 (a) 14,424,260 14,250,305 98.8 162,832 14,413,137 99.9
2015 15,009,704 14,749,222 98.3 242,767 14,991,989 99.9
2016 15,261,029 15,032,113 98.5 203,419 15,235,532 99.8
2017 16,642,674 16,554,392 99.5 9,652 16,564,044 99.5
2018 $ 17,069,728 16,809,461 98.5 $ — $ 16,809,461 98.5
Source: Borough general ledger.
(a) Due to personal property audits in subsequent years, tax collections exceeded original taxes levied.
Total Collections to DateTaxes Levied
for the
Fiscal Year
Percentage
of LevyAmount of Levy
Percentage
June 30,
Ended
Fiscal Year
Collected within the
Fiscal Year of the Levy
140
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 $ 75,767,400 1 5.6% $ 9,028,842 7 0.9%
Matson Navigation (b) 45,755,600 2 3.4% — — —
Ocean Beauty Seafoods 35,989,000 3 2.7% 16,237,441 1 1.6%
North Pacific Seafoods (a) 20,673,200 4 1.5% — — —
Int'l Seafoods of Alaska 15,921,700 5 1.2% 10,879,502 4 1.1%
Mill Bay Plaza Assoc Ltd 12,588,800 6 0.9% 8,648,400 8 0.9%
GCI Communication Corp. 10,558,000 7 0.8% 7,563,488 9 0.8%
Wal-Mart/Sam's Club 9,737,600 8 0.7% 9,987,787 5 1.0%
Island Fish Co LLC 6,733,400 9 0.5% — — —
Brechan Enterprises, Inc 5,850,300 10 0.4% 9,569,530 6 1.0%
Westward Seafoods — — — 11,852,090 2 1.2%
Alaska Communications Systems — — — 11,645,093 3 1.2%
Kodiak Fishmeal Company — — — — — —
Koncor Forest Products — — — 6,797,500 10 0.7%
Total $239,575,000 17.8% $102,209,673 10.4%
—
Source: Borough tax records.
(a) North Pacific Seafoods and Alaska Pacific Seafoods were combined in 2006.
(b) Matson Navigation purchased Horizon Lines in 2012.
2018 2009
141
Net
Total Taxable Net Debt Per
Fiscal Assessed Bonded Per Assessed
Year Population Value Debt Capita Value
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%
2018 13,287 (b) 1,342,823,899 77,748,492 5,851 5.79%
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
142
KODIAK ISLAND BOROUGH
Computation of Direct Debt
Percentage Kodiak Island
Net Debt Applicable to this Borough
Outstanding Governmental Share of
(a) Unit (b) Debt (c)
Kodiak Island Borough:
General obligation bonds $ 77,748,492 100% $ 77,748,492
City of Kodiak:
General obligation bonds 6,350,000 100% 6,350,000
Total $84,098,492 $84,098,492
(a) Gross debt outstanding less applicable amounts in the Debt Service Funds.
(b) Determined by ratio of assessed valuation of property subject to taxation in overlapping unit to
valuation of property subject to taxation in reporting unit.
(c) Per Alaska Statute 29.45.090 there is a limit of 30 mills for ad valorem taxes.
Per Alaska Statute 29.45.100 the limitation on maximum mill rate does not apply to taxes levied to
pay bonds.
Sources: Borough general ledger and City of Kodiak records.
June 30, 2018
143
2009 2010 2011 2012 2013
Taxable Assessed value $ 870,472,985 913,014,985 988,879,125 1,039,223,833 1,085,968,080
Plus exempt property 45,188,050 50,452,120 55,543,030 59,588,100 65,600,100
Total $915,661,035 963,467,105 1,044,422,155 1,098,811,933 1,151,568,180
2014 2015 2016 2017 2018
Taxable Assessed value 1,131,476,611 1,181,899,002 1,202,877,172 1,312,339,398 1,342,823,899
Plus exempt property 71,462,869 68,377,078 77,488,300 87,253,178 84,804,178
Total 1,202,939,480 1,250,276,080 1,280,365,472 1,399,592,576 1,427,628,077
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
144
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
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
2018 3,870,000 3,408,310 7,278,310 6,088,516 119.5
(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
145
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
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 13.84% 8,355
77,748,492 — 11,327,067 18,129,817 107,205,376 * 8,068
Note: Detail regarding the Borough's outstanding debt can be found in the notes to the financial statements.
* Information not available at report time.
2018
Governmental Activities Business-type Activities
2016
Last Ten Fiscal Years
Fiscal
Year
2010
2017
2014
2009
2013
2012
2011
2015
146
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)
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 58,843 2,437 5.0
2017 13,563 818,860,000 60,891 2,386 4.6
2018 13,287 * * 2,437 4.8
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
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Borough Population and Student Count
Population (a)School Enrollment (b)
147
Fiscal Year 2009 Fiscal Year 2010 Fiscal Year 2011 Fiscal Year 2012
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 5,961 $ 3,100 5,961 $ 3,100 6,416 $ 3,362 6,461 $ 3,488
Private Ownership 4,485 2,956 4,485 2,956 4,898 3,263 4,898 3,412
Total Government 1,475 3,538 1,475 3,538 1,518 3,681 1,501 3,742
Private Goods-Producing 1,814 3,290 1,814 3,290 2,113 3,619 2,193 3,801
Private Service-Providing 2,671 2,730 2,671 2,730 2,785 2,993 2,760 3,101
Fiscal Year 2013 Fiscal Year 2014 Fiscal Year 2015 Fiscal Year 2016
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 6,411 $ 3,459 6,472 $ 3,575 6,524 $ 3,650 6,154 $ 3,292
Private Ownership 4,928 3,358 5,049 3,491 5,148 3,565 4,721 3,118
Total Government 1,483 3,795 1,423 3,875 1,377 3,966 1,433 3,867
Private Goods-Producing 2,138 3,704 2,219 3,831 2,268 3,832 2,012 2,766
Private Service-Providing 2,790 3,092 2,830 3,224 2,879 3,356 2,710 3,378
Fiscal Year 2017 Fiscal Year 2018
Average Average Average Average
Monthly Monthly Monthly Monthly
Employment Earnings Employment Earnings
Total Industries 6,294 $ 3,540 6,037 $ 3,585
Private Ownership 4,867 3,407 4,578 3,433
Total Government 1,427 3,995 1,460 4,060
Private Goods-Producing 1,934 3,318 1,636 3,067
Private Service-Providing 2,933 3,466 2,942 3,637
KODIAK ISLAND BOROUGH
Average Monthly Employment & Earnings
Last Ten Fiscal Years
148
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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 26.1 26.1 26.1 26.1 26.1 26.1
Building permits:
Permits issued 192 208 204 167 219 155 193 216 143 93
Value of buildings (thousands) 15,007 16,445 30,832 10,171 91,619 36,652 36,216 10,866 11,793 7,331
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) 223 223 224 224 224 224 224 224 224 224
Facilities:
Number of playgrounds 15 15 16 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) 7 7 8 8 8 7 7 7 7 7
Number of support personnel (b) 217 217 215 215 193 181 187 200 206 206
Number of teachers (c) 203 218 201 201 207 162 166 170 177 210
Number of students (d) 2,598 2,567 2,543 2,543 2,513 2,468 2,446 2,437 2,386 2,437
Number of Municipal Employees 43 43 43 45 45 48 45 43 44.5 45
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
149
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
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 7,193,534 243,973,000 384,902,202 820,796,597
2018 23 3,515,430 70 3,815,114 233,000,000 390,922,837 859,606,088
*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
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Deposits in Kodiak Banks
150
2009 2010 2011 2012 2013
Function:
General Government 31 29 29 30 30
Community and Economic Development 5 5 5 6 6
Municipal Solid Waste Collection and Disposal 7 7 7 7 7
Kodiak Fisheries Research Center 2 2 2 2 2
Total 45 43 43 45 45
2014 2015 2016 2017 2018
Function:
General Government 33 30 29 28.5 29
Community and Economic Development 5 4 5 6 6
Municipal Solid Waste Collection and Disposal 8 9 7 8 8
Kodiak Fisheries Research Center 2 2 2 2 2
Total 48 45 43 44.5 45
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
151
KODIAK ISLAND BOROUGH
Operating Indicators by Function
Last Ten Fiscal Years
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Function
General Government
Elections
Number of registered voters 9,599 9,649 9,619 9,479 9,585 9,209 9,100 9,585 9,453 9,357
Number voting in last election 2,477 2,477 2,311 2,139 1,250 1,566 1,968 1,800 2,303 1,692
Percent of registered voters 26% 26% 24% 23% 13% 17% 22% 19% 24% 18%
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 203 245 149 113 160 111 183 161 177 128
Junk cars removed 83 89 218 27 22 28 37 21 10 35
Primary and secondary education
Number of students 2,598 2,567 2,543 2,517 2,513 2,468 2,446 2,437 2,386 2,437
Number of General Fund certified staff 225 224 217 211 207 186 177 183 196 206
Number of General Fund classified staff 135 135 162 166 193 161 166 173 187 210
Solid waste disposal
Total solid waste disposal in tons 14,429 14,580 14,896 16,558 14,688 11,826 12,364 12,876 11,646 11,458
Baled waste in tons 10,212 10,527 10,846 10,153 11,535 10,005 8,900 10,454 9,875 10,396
Scrap metal in tons 205 282 260 147 251 172 205 221 190 128
Asbestos, cubic yards 324 218 230 116 399 390 362 219 179 142
Source: Borough Finance Department
152
Function program 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
GOVERNMENTAL ACTIVITIES
Number of buildings (teacher housing, schools and office buildings)18 18 18 19 19 19 19 21 20 20
Vehicles 13 13 15 15 15 14 14 11 14 13
Streets (miles) 25.6 25.6 25.6 26.1 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
11 8 15 13 13 12 12 10 11 13
1 1 1 1 1 1 1 1 1 0
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 1
223 223 224 224 224 224 224 224 224 224
1 1 1 1 1 1 1 1 1 1
15 15 16 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
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
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
153