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FY2023 ACFRKODIAK ISLAND BOROUGH ALASKA Annual Comprehensive Financial Report Year Ended June 30, 2023 Altman, RogerCERs n & Co. IACCO ACCOUNTANTS r I r E 11 L L L KODIAK ISLAND BOROUGH ALASKA Annual Comprehensive Financial Report Year Ended June 30, 2023 Official Issuing Report Dora Cross Finance Director C 11 KODIAK ISLAND BOROUGH TABLE OF CONTENTS June 30,2023 1. L L L C L FINANCIAL SECTION: Independent Auditor's Report Management's Discussion and Analysis Basic Financial Statements: Government -wide Financial Statements: Statement of Net Position Statement of Activities Fund Financial Statements: Balance Sheet — Governmental Funds Reconciliation of Net Position Between the Government -Wide and the Fund Financial Statements Statement of Revenues, Expenditures, and Changes in Fund Balances — Governmental Funds Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statement of Net Position — Proprietary Funds — Business -Type Activities — Enterprise Funds Statement of Revenues, Expenses, and Changes in Net Position — Proprietary Funds — Business -Type Activities — Enterprise Funds Statement of Cash Flows — Proprietary Funds — Business -Type Activities — Enterprise Funds Notes to Basic Financial Statements Required Supplementary Information: Budgetary Comparison Schedule — General Fund Budgetary Comparison Schedule — Special Revenue Fund — Education Support Budgetary Comparison Schedule — Special Revenue Fund — Facilities Public Employees' Retirement System: Schedule of Borough's Proportionate Share of the Net Pension Liability Schedule of Borough's Proportionate Share of the Net OPEB Liability (Asset) Schedule of Borough's Contributions (Pension) Schedule of Borough's Contributions (OPEB) Notes to Required Supplementary Information — Budgetary Comparison Schedules Page 1-4 10-13 14-28 29 30 31 32 33 34 35 36 37 38-81 82-83 84 85 86 87 88 89 90-91 INTRODUCTORY SECTION: Letter of Transmittal GFOA Certificate of Achievement F Organizational Chart Elected Officials (Photographs) Borough Officials Map of Kodiak Island Borough 1. L L L C L FINANCIAL SECTION: Independent Auditor's Report Management's Discussion and Analysis Basic Financial Statements: Government -wide Financial Statements: Statement of Net Position Statement of Activities Fund Financial Statements: Balance Sheet — Governmental Funds Reconciliation of Net Position Between the Government -Wide and the Fund Financial Statements Statement of Revenues, Expenditures, and Changes in Fund Balances — Governmental Funds Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statement of Net Position — Proprietary Funds — Business -Type Activities — Enterprise Funds Statement of Revenues, Expenses, and Changes in Net Position — Proprietary Funds — Business -Type Activities — Enterprise Funds Statement of Cash Flows — Proprietary Funds — Business -Type Activities — Enterprise Funds Notes to Basic Financial Statements Required Supplementary Information: Budgetary Comparison Schedule — General Fund Budgetary Comparison Schedule — Special Revenue Fund — Education Support Budgetary Comparison Schedule — Special Revenue Fund — Facilities Public Employees' Retirement System: Schedule of Borough's Proportionate Share of the Net Pension Liability Schedule of Borough's Proportionate Share of the Net OPEB Liability (Asset) Schedule of Borough's Contributions (Pension) Schedule of Borough's Contributions (OPEB) Notes to Required Supplementary Information — Budgetary Comparison Schedules Page 1-4 10-13 14-28 29 30 31 32 33 34 35 36 37 38-81 82-83 84 85 86 87 88 89 90-91 M KODIAK ISLAND BOROUGH n TABLE OF CONTENTS, CONTINUED Page Additional Supplementary Information: Budgetary Comparison Schedule — Debt Service Fund — Education 92 Nonmajor Governmental Funds: Combining Balance Sheet 93 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 94 a Nonmajor Special Revenue Funds: Combining Balance Sheet 95-96 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 97-98 Schedule of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual: Fire and Road Service Areas: Fire: Fire Protection Area No. 1 99 Womens Bay Fire Department 100 Kodiak Airport Fire District 101 Road: Monashka Bay Road Service Area 102 Service Area No. 1 103 Womens Bay Road Service Area 104 Bay View Road Service Area 105 Service Area No. 2 106 L.E.P.C. 107 Land Sales 108 Buildings and Grounds 109 Woodland Acres Street Light Service Area 110 a Trinity Islands Street Light Service Area 111 Tourism Development 112 ry Commercial Passenger Vessel 113 U Mission Lake Tide Gate 114 Opioid Class Action Settlement 115 Nonmajor Capital Project Funds: Combining Balance Sheet 116 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 117 Nonmajor Enterprise Funds: Combining Statement of Net Position 118 Combining Statement of Revenues, Expenses, and Changes in Net Position 119 Combining Statement of Cash Flows 120 Enterprise Funds: Schedule of Revenues, Expenses, and Changes in Net Position — Budget and Actual: Municipal Solid Waste Collection and Disposal 121 Hospital Facilities 122 Long Term Care Center 123 Kodiak Fisheries Research Center 911 Service Fund 124 125 Research Court Apartments 126 F I I L KODIAK ISLAND BOROUGH TABLE OF CONTENTS, CONTINUED STATISTICAL SECTION: Page Supplementary Bond Schedules: Summary of Bonded Debt Service Requirements to Maturity 127 General Obligation Bond, 2021 Series One — Retirement Schedule 128 General Obligation Bond, 2021 Series Two — Retirement Schedule 129 General Obligation Bond, 2021 Series Three — Retirement Schedule 130 General Obligation Bond, 2014 Series One / 2021 Series Four — Retirement Schedule 131 General Obligation Bond, 2015 Series Three —Retirement Schedule 132 General Obligation Bond, 2015 Series Three — Retirement Schedule 133 General Obligation Bond, 2016 Series One — Retirement Schedule 134 General Obligation Bond, 2016 Series One — Retirement Schedule 135 General Obligation Bond, 2016 Series Three — Retirement Schedule 136 General Obligation Bond, 2018 Series A — Retirement Schedule 137 General Obligation Bond, 2020 Series One A — Retirement Schedule 138 General Obligation Bond, 2020 Series One B — Retirement Schedule 139 STATISTICAL SECTION: Statistical Section Index Net Position by Component — Last Ten Fiscal Years 140 Changes in Net Position — Last Ten Fiscal Years 141 Fund Balances of Governmental Funds — Last Ten Fiscal Years 142 Changes in Fund Balances of Governmental Funds — Last Ten Fiscal Years 143 General Revenues by Source — Last Ten Fiscal Years 144 Assessed and Estimated Actual Value of Taxable Property — Last Ten Fiscal Years 145 Direct and Overlapping Property Tax Rates and Contributions to the School District — Last Ten Fiscal Years 146 Property Tax Levies and Collections — Last Ten Fiscal Years 147 Principal Property Tax Payers — Current Year and Ten Years Ago 148 Ratios of Net Bonded Debt— Last Ten Fiscal Years 149 Computation of Direct Debt 150 Legal Debt Margin Information — Last Ten Fiscal Years 151 Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Fund Expenditures and Transfers — Last Ten Fiscal Years 152 Ratios of Outstanding Debt by Type —Last Ten Fiscal Years 153 Demographic and Economic Statistics — Last Ten Fiscal Years 154 Miscellaneous Statistical Data — Last Ten Fiscal Years 155 Average Monthly Employment & Earnings — Last Ten Fiscal Years 156 Property Value, Construction and Bank Deposits — Last Ten Fiscal Years 157 Full -Time Equivalent Borough Employees by Function/Program — Last Ten Fiscal Years 158 Operating Indicators by Function — Last Ten Fiscal Years 159 Capital Asset Statistics by Function/Program — Last Ten Fiscal Years 160 LI It 111 HI 0 0 (This page was left blank intentionally.) a LTJ I If, II m m m I n f If CJ INTRODUCTORY SECTION Kodiak Island Borough Finance Department 710 Mill Bay Road . Kodiak, rUaska 99615 December 22, 2023 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 (GAAP) in the United States of America 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 annual comprehensive f financial report of the Kodiak Island Borough (Borough) for the fiscal year ended June 30, 2023. 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 j comprehensive framework of internal controls has been designed to provide reasonable rather than t 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 t certified public accountants. The goal of the independent audit was to form an opinion on whether 1 the financial statements of the Borough, for the fiscal year ended June 30, 2023, are presented fairly, in all material respects, in accordance with generally accepted accounting principles in the United LStates 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 L presentation. The independent auditor issued an unmodified ("clean") opinion on the Borough's financial statements for the fiscal year ended June 30, 2023. The independent auditor's report is Lpresented as the first component of the financial section of this report. C L LSI 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 a report not only on the fair presentation of the financial statements, but also on the audited government's internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of State and federal awards. These reports are available in the Borough's separately issued Single Audit Report. GAAP require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The Borough's MD&A can be found immediately following the report of the a 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 and approximately 250 miles south of Anchorage. Kodiak Island is the o 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 6,560 square miles, making it slightly smaller than the State of Massachusetts and serves a population of 12,998 (US Census 2019 estimate). The Borough was incorporated September 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 n services planning, and assessment and collection of taxes for both the Borough and cities within the u 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 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. a 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 a and recreation and solid waste collection and disposal. The Borough is also 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 a statements. Budgetary Accounting and Internal Controls a 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 a 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 1st. The assembly is required to hold public hearings on the proposed budget and to adopt a a final budget by no later than June 10th. The appropriated budget is prepared by fund and department. 2 a r I L L L L L The Assembly makes appropriation transfers between funds and/or departments only after the adoption of an ordinance. Borough staff may execute transfers between line items within a department. Amendments to the budget can occur anytime during the fiscal year through the Borough Assembly or administrative action. Expenditures may not legally exceed appropriations at the following levels: Capital Project Funds —project level, all other funds — department level. All funds, except Capital Project Funds, are budgeted on an annual basis encompassing a fiscal year. Budgets of Capital Project Funds generally encompass the period from start-up to project completion, which is generally greater than one year. Budget -to -actual comparisons are provided in this report for each individual governmental and proprietary fund for which an appropriated annual budget has been adopted. Factors Affecting Financial Condition The information presented in the financial statements is perhaps best understood when it is considered from the broader perspective of the specific environment within which the Borough operates. State budget. The State of Alaska has experienced budget shortfalls for several years and these factors are impacting the communities within the state due to decreased state grant funding, decreased revenue sharing and decreases in program payments such as School Construction Debt Reimbursements. For the last few years, the State has not approved their budget until after the Borough's June 10"' budget adoption deadline, meaning we have had to guess at what the State revenues we will receive for our largest revenue receipt from the State, the School Construction Bond Debt Reimbursement Program. Due to improved revenues, the State approved appropriations at the end of the fiscal year for not only fully funding the School Construction Bond Debt Reimbursement Program for FY23, but to fully fund prior years where reimbursements were less than 100%. Continued improved State revenues has the State's initial FY24 budget funding reimbursements at 100% and maintaining the local contribution to the State Public Employees Retirement System (PERS) at 22%. Local economy. The economic condition of the Kodiak Island Borough remains guarded. 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 600 commercial vessels and consistently ranks among the top ten ports in the United States in terms of amount and value of product delivered. Severance tax revenues on sea products are volatile and can be affected by many variables including quota caps, environmental restrictions, fisheries health, labor availability and supply chain issues. Sea product revenues have seen highs of $1,892,754 in FYI to a low of $996,833 in FY21. Although unemployment rates are low, labor shortages remain an ongoing concern for all local businesses. Tourism also has a strong presence in Kodiak, however the recent trends of online bookings and the construction of a new hotel within the city limits, coupled with remote locations which cannot be readily monitored, may make the transient tax revenues an unreliable indicator of the economy. In FY23 total revenue was $122,016, a definite increase from FY21's number of $50,384. Cruise ship tax revenues dropped from $54,220 in FY20 to $6,745 in FY23. 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, 2023, the unemployment rate for the Kodiak Island Borough was 3.0% compared to the State of Alaska's rate of 4.3%. 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 Annual Comprehensive Financial Report (Annual Report) for the fiscal year ended June 30, 2022. This was the thirty-third consecutive year that the Borough has received this prestigious award. To be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive 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 Annual Report 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, Aimee Williams Borough Manager 4 0-C, &Za . Dora Cross Director of Finance io J Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to Kodiak Island Borough Alaska For its Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2022 Executive Director/CEO 5 I Kodiak Island Borough Fiscal Year 2023 Q Engineering/ Facilities Director KFRC Maintenance Engineer Maintenance Mechanic Assistant Director rPmj ctsctor cts Assistant KFRC _ Interpretive SpedRec. KFRC Inlerprefive _ SpedRec. Secretary III Solid Waste M Environ. Spec. Community Development Director — Associate Planner/ENF Treatment Plant Electorate Operator Lead Director — Code Enforcement Treatment Plant Officer Operator Borough Mayor — GIS Analyst Treatment Plant Borough Assembly Operator Trainee a Appraiser Secretary III Borough Attorney Accounts Payable Borough Clerk PC Net Tech II Supervisor. Borough Manager - 9 -;&,r - Assistant Clerk Deputy Clerk Payroll Technician — Programmer/ HR Officer Executive Grant Writer/ Resource Bayside Fire Chief Assistant Spec Prot Support Mgt Officer Engineering/ Facilities Director KFRC Maintenance Engineer Maintenance Mechanic Assistant Director rPmj ctsctor cts Assistant KFRC _ Interpretive SpedRec. KFRC Inlerprefive _ SpedRec. Secretary III Solid Waste M Environ. Spec. Community Development Director — Associate Planner/ENF Treatment Plant — Associate Planner/LRP Operator Lead Director — Code Enforcement Treatment Plant Officer Operator — GIS Analyst Treatment Plant General Operator Trainee a Appraiser Secretary III Solid Waste Accounts Payable - Baler/Landfill PC Net Tech II Supervisor. Appraiser Baler Operator II -- Baler Operator I —. Baler Operator I — Baler Operator I Baler Operator I — Landfill Attendant — 6 Assessor Finance/MIS Director )Appraiser Property Lead General IT Supervisor a Appraiser Accounting Tech —_LAccountant— Technician Accounts Payable PC Net Tech II Appraiser Accounting Tech Payroll Technician — Programmer/ Assessment Analyst n Clerk I Revenue Accountant Cashier Secretary III MAYOR AND ASSEMBLY MEMBERS Scott Arndt, Mayor, At Large, 2023 Scott Smiley, Deputy Presiding Officer (DPO), At Large, 2024 Joseph Delgado, At Large, 2023 Larry Ledoux , At Large, 2025 Jared Griffin, At Large, 2025 (No Picture Available) Ryan Sharratt , At Large, 2025 Jared Griffin, At Large, 2025 James Turner, At Large, 2024 KODIAK ISLAND BOROUGH KODIAK, ALASKA BOROUGH OFFICIALS YEAR ENDED JUNE 30, 2023 MAYOR Scott Arndt 2023 ASSEMBLY Joseph Delgado 2023 Geoffrey Smith 2023 Jared Griffin 2025 Scott Smiley 2024 Larry Ledoux 2025 James Turner 2024 Ryan Sharrett 2023 Chief MANAGEMENT Aimee Williams-------------------------------------------------------- -------------------------------Borough Manager Dora Cross FinanceDirector/Treasurer Nova Javier-------------------------------------------------------------------------- -...... Borough Clerk Vacant (Seema Garoutte, Interim)---------------------------------------- Community Development Director Seema Garoutte----------------------------------------------------------------------------------------- Borough Assessor Vacant (Carol Scott, Interim).................................................................................Fire Chief Dave Conrad---------------------------------------------------------------------Engineering and Facilities Director PaulVan Dyke-------------------------------------------- --------------------------------------------------- IT Supervisor Keene & Currall-------- _....................... _......................... _... Borough Attorney (Contracted Firm) E N I L L I L (This page was left blank intentionally.) o LIl I f L Fk L 0 L [1 [I] j] FINANCIAL SECTION Altman, Rogers �) CERTIFIED lX Co. I PUBLIC ACCOUNTANTS Independent Auditor's Report The Honorable Mayor and Members of the Assembly Kodiak Island Borough Kodiak, Alaska Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, the business -type Iactivities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the Kodiak Island Borough (the Borough), as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the Borough's basic financial statements as listed in the table of contents. In our opinion, the accompany financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, the aggregate discretely presented component unit, each major fund, and the aggregate remaining fund information of the Borough, as of June 30, 2023, 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. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States (Government Auditing Standards). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Borough and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for 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. io L 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 The Honorable Mayor and Members of the Assembly Kodiak Island Borough In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Borough's ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is Q not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we: • Exercise professional judgment and maintain professional skepticism throughout the audit. a • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit 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 Borough's internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Borough's ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control -related matters that we identified during the audit. a 1 I 11 Q F r I I L L L L The Honorable Mayor and Members of the Assembly Kodiak Island Borough Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Budgetary Comparison Schedules, Schedules of Borough's Proportionate Share of the Net Pension and OPEB Liabilities (Assets) and Contributions for the Public Employees's Retirement System, and Notes to Required Supplementary Information on pages 14-28, 82-85, 86-89, and 90-91, respectively, be presented to supplement the basic financial statements. Such information is the responsibility of management and, 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. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Borough's basic financial statements. The accompanying supplementary information, which includes the combining and individual major and nonmajor fund financial statements, is 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 basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory section, supplementary bond schedules, and statistical section but does not include the basic financial statements and our auditor's report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. 12 The Honorable Mayor and Members of the Assembly Kodiak Island Borough We also have previously audited, in accordance with auditing standards generally accepted in the United States of America, Kodiak Island Borough's basic financial statements for the year ended June 30, 2022, 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 aggregate 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 statements 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, 2022, 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 related directly to the underlying accounting and other records used to prepare the 2022 basic financial statements. The information was subjected to the audit 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 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 2022 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. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 22, 2023, on our consideration of the 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 the 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 Borough's internal control over financial reporting and compliance. Jit Anchorage, Alaska December 22, 2023 13 W IRI I e I IIJ 1 11 T TI T T P f t I L r I MANAGEMENT'S DISCUSSION AND ANALYSIS I L I L L L t KODIAK ISLAND BOROUGH rManagement's Discussion and Analysis June 30, 2023 rAs 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, 2023. We encourage readers to consider the information presented herein in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages I - 4 of this report. rFINANCIAL HIGHLIGHTS I L LI I I • The Borough's total net position increased 4.8% or $10 million. $8.2 million of this increase was to governmental activities and is primarily due to $4.8 million dollar of unexpended ARPA (American Rescue Plan Act) grant money and a $4 million increase in capital assets. The remaining $1.7 million increase is within the business -type funds and reflects an increase in capital assets. • The unrestricted amount of the Borough's total net position, or the amount that may be used to meet the Borough's ongoing obligations to citizens and creditors, increased by 8.7% or $6.8 million, which is due in large part to the State of Alaska's reimbursement of prior years' unreimbursed school bond construction debt payments and unexpended ARPA grant money. • Total equity in the central treasury increased by 17.9% or $17.3 million. The governmental activities central treasury increased by 24.6% or $19.7 million and can be attributed to the receipt of $12.3 million reimbursement of school bond construction debt and $4.8 million of grant funding. The business -type activities equity in central treasury decreased by 14.7% or $2.4 million mainly due to capital asset purchases in the Solid Waste Collection & Disposal fund. • The Borough's total noncurrent liabilities (obligations due in more than one year) decreased by $8.7 million (10.3%). $8.5 million of this decrease is due to decreasing note and bond payments and the closure post closure liabilities saw a $0.5 million reduction. • At the end of the current fiscal year, the Borough's governmental funds (which excludes business type funds) reported combined fund balances of $76.3 million. This was an increase of $4.9 million (6.9%) and can be attributed to school bond debt reimbursements and grant funding. Approximately 22.6% of the current year's ending fund balance, or $17.2 million of unassigned fund balance, is available for spending at government's discretion. • At the end of the current fiscal year, the $5.5 million of General Fund expenditures equates to 32% of the $17.2 million of unassigned fund balance. OVERVIEW OF THE FINANCIAL STATEMENTS The management discussion and analysis serve 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. 14 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued 1) Government -wide Financial Statements (pages 29-30) 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 property leases for various Borough -owned buildings including a hospital, long-term care center, a fisheries research center, and an apartment building. • 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's 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 ofActivities 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. 15 I L KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued 2) Fund Financial Statements (pages 31-37) 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. Fund Type Governmental Funds: General Fund Debt Service Fund Special Revenue Capital Projects Total Governmental Funds Proprietary Funds: Enterprise Funds Total of All Funds Number of Funds Maior Non -Major Total Funds 1 - 1 1 - 1 2 17 19 1 6 7 5 23 28 4 2 6 9 25 34 a) Governmental Funds (pages 82-85 and 92-117) — 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 35-37 and 118-126) —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 38-81) The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. L16 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued 4) Required Supplementary Information (pages 82-91) 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. 5) Additional Supplementary Information (page 92-126) The basic financial statements are followed by additional supplementary information on individual fund activity. GOVERNMENT -WIDE FINANCIAL ANALYSIS Statement of Net Position (page 29) 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 $219 million at June 30, 2023, compared to $209 million at June 30, 2022. Total Net Position of Government and Business -Type Activities (last 10 years) 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 203 ■ Business Type Activities ■ Governmental Activites The largest portion of the Kodiak Island Borough's net position ($135 million or 62%) 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. 17 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued The total net position has increased over the past 10 years indicating an improving financial position as illustrated by the graph on the previous page. The Borough has maintained a stable financial position and the $84 million of the unrestricted net position may be used to meet the Borough's ongoing obligations to citizens and creditors. Net Position of Governmental and Buisness-type Activities (in thousands) For Years Ended lune 30, 2023 and 2022 r Governmental Business -type 'I otal FE Activities Activities Activities r 2023 2022 2023 2022 2023 2022 Current and other assets $ 102,962 96,039 39,355 42,515 142,317 138,554 Capital assets 141,035 146,044 65,659 64,521 206,694 210,565 Total assets 243,997 242,083 105,014 107,036 349,011 349,119 I L Deferred outflows of resources Total assets and deferred outflows of resources Long-term liabilities Other liabilities Total liabilities 738 936 254 137 992 1,073 $ 244,735 243,019 105,268 107,173 350,003 350,192 $ 48,620 55,112 26,606 28,782 75,226 83,894 32,045 29,589 4,575 2,611 36,620 32,200 80,665 84,701 31,181 31,393 111,846 116,094 Deferred inflows of resources 114 2,605 18,401 21,852 18,515 24,457 Total liabilities and deferred inflows of resources 80,779 87,306 49,582 53,245 130,361 140,551 Net position Net investment in capital assets 89,931 88,558 45,387 43,543 135,318 132,101 Restricted 54 47 54 47 Unrestricted 73,971 67,108 10,299 10,385 84,270 77,493 Total net position $ 163,956 155,713 55,686 53,928 219,642 209,641 Changes in Net Position During the current fiscal year, the Borough's total net position increased by $10 million (4.8%). This compares to an increase of $13.03 million for the year ended June 30, 2022. Of the $10 million increase, the governmental net position increased by $8.2 million (5.3%) and is primarily the result of unexpended ARPA (American Rescue Plan) grant money. The remaining $1.7 million (3.3%) increase is within the business -type funds and reflects an increase in capital assets in the Solid Waste Collection and Disposal funds creation of rock and purchase of equipment for the landfill. LGovernmental: Revenues decreased overall by $3.9 million (10.5%) primarily due to the loss of one-time Lmoney from the State of Alaska for the reimbursement of school bond construction debt payments. Expenditures increased by $178,489 (0.7%) as compared to FY2022 due to increased primary and Lsecondary education spending. Business -type: Revenues increased overall by $767,539 (10.2%) due to increased interest earnings on L investments. Expenses decreased by $298,537 (4.4%) as compared to FY2022 primarily due to reduced personnel costs and reduced closure/post closure costs. I L18 19 KODIAK ISLAND BOROUGH 0 Management's Discussion and Analysis, Continued 0 Statement of Activities (page 30) The following table shows the changes in net position for fiscal years 2023 and 2022 for both governmental r� and business -type activities. IJ Changes in Net Position (in thousands) Governmental activities Business -type activities Total activities 2023 2022 2023 2022 2023 2022 Revenues: Program revenues Charges for services $ 968 945 7,793 8,074 8,761 9,019 Operating grants and contributions 5,820 14,585 (28) (38) 5,792 14,547 Capital grants 140 626 140 626 General revenues Q Property taxes 18,130 17,607 - - 18,130 17,607 Grants and entitlements not restricted to specific programs 3,892 3,168 3,892 3,168 Land sales 5 5 - - 5 5 a Excise taxes 829 684 - - 829 684 Severance taxes 1,719 1,779 1,719 1,779 Other 742 534 393 316 1,135 850 Investment earnings 952 (2,821) 127 (836) 1,079 (3,657) Total revenues 33,197 37,112 8,285 7,516 41,482 44,628 Expenses: General government 3,799 5,349 3,799 5,349 Public safety 672 710 - - 672 710 Community and economic development 776 877 776 877 Emergency preparedness 16 11 16 11 Health and social welfare 150 170 - - 150 170 n Education, culture and recreation 21 20 - - 21 20 U Parks and recreation 13 22 13 22 Service district maintenance Primary and secondary education 700 17,883 857 16,008 - - 700 17,883 857 16,008 Interest on long-term debt 924 752 - - 924 752 Municipal solid waste collection and disposal 2,831 3,373 2,831 3,373 Hospital facilities - - 1,375 1,116 1,375 1,116 Long Tenn Care Center - - 561 671 561 671 Kodiak Fisheries Research Center 1,355 1,282 1,355 1,282 911 services 326 301 326 301 Research Court Apartments - - 79 - 82 79 82 Total expenses 24,954 24,776 6,527 6,825 31,481 31,601 Change in net position 8,243 12,336 1,758 691 10,001 13,027 Net position, beginning of year 155,713 143,377 53,928 53,237 209,641 196,614 Net position, end of year $ 163,956 155,713 55,686 53,928 219,642 209,641 n 19 r F 1 E C 61 I KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued Governmental Activities — increased the Borough's net position by $8.2 million (5.3%). Revenues: The two largest sources are Property Taxes and Operating and Capital Grants at $18.1 million and $5.9 million, respectively. Investment Earnings was the largest increasing revenue by $3.8 million (135.7%) and Operating Grants was the largest decreasing revenue by $8.7 million (60.1%). Overall revenues decreased by $3.4 million (10.5%) from 2022. FY2023 Governmental Activities - Revenue Sources Investment earnings Other 3% _3% Charges for services Severance taxes 5% Excise taxes 2% Grants and entitlements not _ restricted to specific programs 12% 3% Operating grants and contributions 18% Property taxes 54% Expenses: The largest functional expense is Primary and Secondary Education, which amounted to $17.9 million, a 11.7% increase from 2022 due to increased funding to the school district. General Government was the second largest expense at $3.8 million a $1.5 million (28.9%) decrease from 2022 due to reduced transfers to the Debt Service Fund and vacant staff positions. Most other function categories decreased with the exception of interest on long-term debt which increased by $172,531 due the final payments on the unrefunded portion of the debt refunding which occurred in 2021. Overall, total expenses increased by $178,489 (0.7%) from 2022. FY2023 Governmental Activities - Functional Expenses Interest on long-term debt General government q% 15% Public safety Service district 3% maintenanc \ Community and economic development 3% Primary and secondary educa 72% 20 th and social services 0% KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued Business Activities - increased the Kodiak Island Borough's net position by $1.7 million (3.3%). Revenues: The largest source is Charges for Services at $7.79 million which decreased by $280,684 (3.48%) which is primarily due to the new lease revenue recognition rules. Interest earnings were the largest increase in revenues by $962,724 as compared to 2022. Overall, total revenues increased by $767,536 (10.2%) from 2022. FY2023 Business -Type Activities - Revenue Other 5% Expenses: The largest source is from the Municipal Solid Waste Collection and Disposal fund which totaled $2.8 million, and also had the largest decrease in expenses at $542,323 (16%). The largest increase in expenses was from the Hospital Fund due to an increase in depreciation as compared to 2022. Overall, total expenses decreased by $298,537 (4.4%) from 2022. FY2023 Business -Type Activities - Expenses E911 service Contributions 5� 2% Recycling services 5% General Administration 13% Depreciation 43% 21 Personnel services 23% services 4% Maintenance and repair 5% r r [1 L L L L L KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued 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 $76.3 million, an increase of $4.9 million (6.9%) in comparison to the beginning of the year. Of this total amount, $122,416 constitutes nonspendable, $54,247 was restricted, $45.9 million was committed, $12.9 million was assigned, and $17.2 million was unassigned fund balance. 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 $120,671, with an unassigned fund balance of $17.4 million for a total fund balance of $17.55 million. As a measure of the General Fund's liquidity, it may be useful to compare fund balance to total expenditures. Unassigned fund balance represents 316.25% of total General Fund expenditures. 22 GOVERNMENTAL FUNDS - FUND BALANCE 50,000,000 40,000,000 $39,911,999 30,000,000 20,000,000 $17,550,830 $17,898,869 10,000,000 $445,666 $687,206 0 (10,000,000) -------- $(185,907) General Education Facilities Debt Service State Capital Non -Major Funds Grants 22 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued Major Fund Highlights • General Fund — Fund balance increased by $9.3 million (112.7%) during the current fiscal year. Total revenues were $2 million more than anticipated due to higher than expected sea products severance tax, excise tax and federal PILT revenues. Expenditures were $7.1 million less due largely due to receiving the prior years school bond debt reimbursements from the State of Alaska. Total fund balance is $17.5 million and meets the minimum required reserve balance of $2.9 million. • Education Support (Special Revenue Fund) — Fund balance decreased by $28,474 (18%) and has a negative balance of $185,907 at year-end. A correction of a five-year assessment clerical error resulted in a loss of nearly $200,000 of tax revenues in FY2021 for this fund, which was the key f�(j factor of the deficit. • Facilities Fund (Special Revenue Fund) — Fund balance increased by $2.6 million (7%) during the current fiscal year. Investment income, the sole revenue source for the fund, was $2.5 million more than the previous year. Since the fund is required to be valued at fair value as of June 30th, and market treasury values decrease in an increasing interest rate environment, the change in market j value for the investments was a value increase of $2.5 million. Provided the borough does not sell u securities prior to maturity, which it has not done, the change in market values will not be realized. Although earnings income is eligible for use, the earnings were not used in FY23. a • Education Debt Service Fund (Debt Service Fund) — Fund balance decreased by $11.7 million (94.5%), due to the return of money to the various funds which contributed money in order to n 1411 cover payments the State of Alaska did not reimburse to the Borough. The fund balance is $687,206 and meets the minimum required reserve balance of $275,000. Other Governmental Funds (Non -Major Funds) Highlights a Other Governmental funds — Aggregate fund balance increased by $4.79 million (36.6%) during the current fiscal year, special revenue funds increased $481,322 and capital projects funds increased $4.3 o million. • Fire Protection Area 41 (Special Revenue Fund) — Fund balance increased by $285,327. The key factor leading to this was improved investment earnings and a reduction in expenses. • Renewal and Replacement Projects Fund (Capital Projects Fund) — Fund increased by $4.47 million primarily due to a $4.2 million transfer in from the Debt Service fund to replace money contributed a to prior years unreimbursed school construction debt payments. M 111 II] I 23 0 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued Proprietary Funds — The Borough's proprietary funds provide the same type of information found in the government -wide financial statements, but in more detail. The only proprietary funds the Borough has is Enterprise funds. As of the end of the current fiscal year, the Borough's proprietary funds reported combined net position of $55.68 million, an increase of $1.75 million (3.2%) compared to the beginning of the year. Equity in central treasury and restricted cash and equivalents decreased by $2.4 million (14.8%) in comparison to the beginning of the year due to payments for capital projects. f 2023 Proprietary Funds - Operating Revenue versus { Operating Expenses 5oo,o00 l ' 4,000,000 3,500,000 L Municipal Hospital Long -Term Kodiak Other Non - Solid Facilities Care Fisheries Major Waste Center Research Funds Center LI Major Fund Highlights 3,000,000 ■ Operating Revenues 2,500,000 2,000,000 ■ Operating Expenses 1,500,000 1,000,000 500,000 0 • Municipal Solid Waste Collection and Disposal—Net position increased by $1.25 million (6.45%) primarily due to decreased closure/post closure liabilities. • Long -Term Care Center — Net position increased by $757,290 (10.26%) primarily due to improved investment earnings. • Kodiak Fisheries Research Center—Net position decreased by $411,415 (4.2%) due to decreased revenues and increased depreciation expenses. Other Nonmajor Fund Highlights • 911 Services — Since the revenues to this fund are passed through to the City of Kodiak, the net position at year-end is $0. • Research Court Apartments — Net position increased by $17,891 (5.8%) due to stable tenant income and repair expenses. 24 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued GENERAL FUND BUDGETARY HIGHLIGHTS (Pages 82-83) The Borough's budget is prepared, according to Alaska law, using a basis of accounting that is consistent with accounting principles generally accepted in the United States of America. The most significant budget areas are in the General Fund. Within general fund revenues, the largest difference between budgeted and actual revenues was sea products severance tax receiving $454,470 more than budgeted and payments in lieu of taxes (PILT) receiving $345,197 more than budgeted. Overall, actual revenues were $2 million (29.3%) more than budgeted. FY2023 Budget to Actual Comparison of Revenues 2,500,000 2,000,000 1,500,000 '' ■, ' ' _ ■ 1,000,000 500,000 0 Property Taxes Severance Excise Tax State Sources Federal Other Taxes Sources ■Budgeted ■Actual Within general fund expenditures by function, the largest difference between budgeted and actual expenses was the general administration department expending $6.1 million less than what was budgeted. The finance department expended $11,651 more than budgeted primarily due to increased personnel costs. Overall, actual expenditures were $7.1 million (129.8%) less than budgeted. FY2023 Budget to Actual Comparison of 12,000,000 Expenditures - By Function 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 General Public Safety Community & Emergency Non -Profit Parks and Government Economic Preparedness Recreation Development 25 ■ Budgeted ■ Actual F r F 1, L L L L KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets (Note 8 on page 53-57) — The Borough's investment in capital assets includes land, buildings and improvements, improvements other than buildings, machinery and equipment, and construction work -in -progress. During the year, the construction work -in -progress decreased by $2.67 million due to the completion of construction projects. All other categories decreased due to depreciation expenses with the exception of equipment due to the purchase of vehicles and heavy equipment. As of June 30, 2023, the total net book value was $205.9 million, a decrease of $4.5 million (2.2%). The following table displays the capital assets (net of accumulated depreciation) at June 30, 2023, with a comparison to 2022. Artwork 9 Land Construction work -in -progress Buildings and improvements Improvements other than buildings Equipment Infrastructure Unclassified plant in service Governmental Business -type Total 2023 activities _T6TT_ 2023 activities activities 2023 IFTT_ 16,091 16,091 16,091 16,091 22,752,807 22,752,807 1,661,499 1,661,499 24,414,306 24,414,306 1,274,696 5,297,991 33,034,251 32,321,442 34,308,947 37,619,433 102,753,184 103,123,951 26,573,117 26,011,107 129,326,301 129,135,058 11,953,454 13,729,240 2,475,660 3,134,511 14,429,114 16,863,751 2,133,546 950,229 1,309,503 745,403 3,443,049 1,695,632 166,940 189,807 2022 General obligation bonds, including premium 166,940 189,807 51,966,107 588,772 630,827 588,772 630,827 $ 141,034,627 146,044,025 65,658,893 64,520,880 206,693,520 210,564,905 Long -Term Debt (Note 10, pages 59-64) — At the end of the current fiscal year, the Borough's total General Obligation outstanding bonded debt of $49,855,000 (not including premiums). This amount is backed by the full faith and credit of the Borough. The remainder of the Borough's debt represents loans, revenue notes payable, compensated absences, and landfill closure/post-closure costs. The following table displays the long-term debt at June 30, 2023, with a comparison to 2022. The Borough's total debt decreased by $8.97 million (10.2%) during the current fiscal year. This decrease can be attributed to regularly scheduled bond payments. There is no general obligation debt limit imposed on the Borough by the State Constitution, state statutes, or the Borough's charter or code. 26 Governmental Business -type Total activities activities Activities 2023 2022 2023 2022 2023 2022 General obligation bonds, including premium $ 51,966,107 58,575,062 51,966,107 58,575,062 Compensated absences 209,309 152,113 122,304 152,136 331,613 304,249 Landfill post closure care costs 6,693,000 7,189,000 6,693,000 7,189,000 Loans/notespayable — — 11,304,555 12,173,628 11,304,555 12,173,628 Revenue Bonds Payable 8,967,330 9,991,972 8,967,330 9,991,972 $ 52,175,416 58,727,175 27,087,189 29,506,736 79,262,605 88,233,911 The Borough's total debt decreased by $8.97 million (10.2%) during the current fiscal year. This decrease can be attributed to regularly scheduled bond payments. There is no general obligation debt limit imposed on the Borough by the State Constitution, state statutes, or the Borough's charter or code. 26 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued ECONOMIC FACTORS AND NEXT YEAR'S BUDGET AND RATES Economic Factors: p • Kodiak continues to be one of the nation's largest producers of seafood. The Borough has the n fll' largest and most diversified fishing port in Alaska and is consistently ranked in the top five largest fishing ports in the U.S. in terms of value landed. New fisheries, such as kelp and oyster farming, are being cultivated. • Although commercial fishing activities (excluding tourist -based fishing) were relatively unaffected by COVID restrictions, processing activities saw operation interruptions related to both staffing and supply chain disruptions and increased costs due to plant safety modifications o and personal protective equipment purchases. • Tourism continues to increase; however, the number of cruise ships stopping in Kodiak has not returned. Revenues from this source are expected to be severely impacted for several years. • Kodiak's general real estate market has been increasing since the late 1980s. The demand for affordable housing increased with the 2016 closure of a major mobile home park within the Borough and despite the recent construction of several affordable housing developments, housing is still a concern. The biggest constraint to the construction of housing is land availability. The Coast Guard has recently started to build new and renovate current housing in anticipation of their increased personnel needs. Although Kodiak has begun to see an increase in both sales and sale prices, the average home cost in 2022 was $391,000, which is about 8% lower than the state average of $422,000. • The unemployment rate for the Kodiak Island Borough on June 30, 2023, was 3.0% compared to 3.9% on June 30, 2022. The hiring of seasonal cannery and other fisheries -related workers traditionally peaks around July and is virtually nothing in December which generally accounts for seasonal highs and lows in the local unemployment rate. The unemployment rate for the State of Alaska on June 30, 2023 was 4.3%. o • Kodiak is home to the largest United States Coast Guard Base (USCG) in the United States employing around 1,350 people and providing vital services to the marine industries that are an integral part of Kodiak's make-up. Base Kodiak supports both cutters and aircraft and is homeport to three ships and contains three hangers that house 15 various aircraft. Future growth is expected over the next few years and could include four new ships and two new aircraft. With the increased personnel and support staff, additional on -base housing is being constructed. N L� W 1 27 0 KODIAK ISLAND BOROUGH Management's Discussion and Analysis, Continued f Next Year's Budgets and Rates: • No change to the Area -wide mill rate. • Although assessed valuations continue to increase, general fund property tax revenue increases are limited to new property, property improvements, and changes to the Kodiak area Consumer [ Price Index. • Local contribution funding to the Kodiak Island Borough School District will increase to around 98% of State allowed funding by the borough. With the revenue limitations in place for property taxes, the increase in school funding will mean a decrease to other areas funded by property tax I I L L L L I revenues. • Sea Product revenues from the State and from local sources are projected to stabilize however some fisheries, such as crab, will 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). • The Borough does not currently have any plans to issue new bonds and the next opportunity to refund our existing series will not occur until 2025. • Landfill user fees are not expected to increase next year even with the expansion of the leachate treatment plant. All of these factors were considered in preparing the Borough's budget for the fiscal year 2024. 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. 28 I I r�� I I I C (This page was left blank intentionally.) o 1 I f I m m r BASIC FINANCIAL STATEMENTS F I F 1. L L L L KODIAK ISLAND BOROUGH Statement of Net Position June 30, 2023 (With sammiarized financial information for lune 30, 2022) See accompanying notes to financial statements. 29 Component Primary eoveroment unit Twol repmd.E entity Assets and Deferred Governmental Business-tvi a &hoof Outflows of Resources activities activities Total District 2023 2022 Equity in central treasury S 99,82],815 14,051,317 113,879,132 - 113,879,132 96,583,813 Due from primary government - - - 17,566,532 17,566,532 18,261,872 Receivables: Leases - 19,681,175 19,681,175 19,681,175 21,776,383 State of Alaska 322,083 - 322,083 2,550,496 2,872,579 14,916,120 Federal government 23,312 - 23,312 - 23,312 5,437 Property taxes, net of allowance of 518,851 266,457 - 266,457 - 266,457 229,455 Severance taxes 169,179 - 169,179 - 169,179 365,105 Excise taxes 193,227 - 193,227 - 193,227 268,549 Interest 633,323 - 633,323 - 633,323 264,769 Land sales contracts receivable 39,980 - 39,980 - 39,980 50,072 Accounts and other receivables 97,004 477,887 574,891 - 574,891 576,672 Curtem portion of notes receivable - 140,763 140,763 - 140,763 135,928 hwenmries - 2,314,593 2,314,593 456,345 2,770,938 1,023,960 Prepaid items 122,416 4,182 126,598 2,040 128,638 56,538 Restricted cash and equivalents - 1,374,054 1,374,054 - 1,374,054 1,329,430 Notes receivable - 740,107 740,107 - 740,107 880,870 Capital assets: Non -depreciable 24,027,503 34,711,841 58,739,344 - 58,739,344 62,049,830 Depreciable, net 117,007,124 30,947,052 147,954,176 824,685 146,778,861 149,246,707 Net OPEB assets 1,267,634 570,850 1,838,484 13,434,437 15,272,921 23,744,106 Total assess 243,997,057 105,013,821 349,010.878 34,834,535 383,845,413 391,765,616 Defined outflows of...s: Related m bond refunding 174,992 - 174,992 - 174,992 349,985 Pension and OPEB deferrals 563,474 253,747 817,221 4,608,778 5,425,999 5,101,567 Total deferred outflows ofreso.a 738,466 253,747 992,213 4,608,778 5,600,991 5,451,552 Total assets and deferred ouNlows of resources S 244.735.523 105,267.568 3500` 39443313 369.446.404 39],21],168 Liabilities, Deferred Inflows of Resources and Net Position Accounts payable S 631,138 2,352,784 2,983,922 738,669 3,722,591 2,052,685 Accrued compensation and related liabilities 105,511 - 105,511 3,159,570 3,265,081 3,109,587 Other accrued liabilities 226,838 57,497 284,335 - 284,335 348,127 Customer deposits 3,348 40,910 44,258 - 44,258 77,717 Untamed revenues 6,807,236 223,995 7,031,231 169,094 7,200,325 4,337,628 Due to component unit 17,566,532 - 17,566,532 - 17,566,532 18,261,872 Noncurrent liabilities: Due within one year: Accrued leave 61,036 28,296 89,332 - 89,332 84,482 Notes payable 6,642,714 1,870,905 8,513,619 - 8,513,619 8,502,670 Due in more than one year: Accrued leave 148,273 94,008 242,281 662,931 905,212 819,266 Notes payable 45,323,393 18,400,980 63,724,373 - 63,724,373 72,237,992 Net laension and OPEB liability 3,148,772 1,417,974 4,566,746 27,019,180 31,585,926 23,090,521 Landfill el. costs - 6,693,000 6,693,000 - 6,693,000 7,189,000 Total liabilities 80,664,791 31,180,349 111,845,140 31,149,444 143,594,584 140,111,547 Deferred inflows of. . . Leases - 18,349,774 18,349,774 - 18,349,774 20,815,825 Related to bond refunding - - - - - 292,206 Pension and OPEB deferrals 114,441 51,536 165,977 1,381,372 1,547,349 26,293,086 Total deferred inflows ofresources 114,441 18,401,310 18,515,751 1,381,372 19,897,123 47,401,117 Net position: Net investment in capital assets 89,930,718 45,387,008 135,317,726 824,685 136,142,411 132,833,136 Restricted' Commercial passenger vessel 54,247 - 54,247 - 54,247 47,010 Student activities - - - 891,801 891,801 849,364 Umestrived ]3,9]1,326 10198,901 84,270,227 4,596,011 88,866,238 75,974,994 Total net position 163,956,291 55.685,909 219,642,200 6,312,497 225,954,697 209,704,504 Total liabilities, deferred inflows of resources and net position S 244,735,523 105.26].568 350,003,091 39,443,313 389,446,404 39],217,168 See accompanying notes to financial statements. 29 KODIAK ISLAND BOROUGH Statement of Activities Year ended lune 30, 2023 ( With summarized financial information for the year ended lune 30. 2022) See accompanying notes to financial statements. 30 ✓� alB�a 4i � hi �' 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 FunctiousnPrograms Expenses services contributions grants activities activities Tribal District 2023 2022 Primary government: Governmental activities: General government S 3,799,341 905.435 (54,161) 5,335 (2,942,732) - (2,942,732) - (2,962,732) (4,429,695) Public safety 671,936 35.125 95 - (636,716) - (636,716) - (636,716) (682,484) Community and economic development 775,952 - (5,550) 135,037 (646,465) - (646,465) - (646,465) (364,029) Emergency preparedness 16,460 - - - (16,460) - (16,460) - (16,460) (10,983) Health and social welfare 150,000 - - - (150,000) - (150,000) - (150,000) (169,647) Education, culture and recreation 20,562 - - - (20,562) - (20,562) - (20,562) (20,396) Parks and recreation 12.760 - - - (12,760) - (12,760) - (12,760) (21125) Service district maintenance 700,146 27,600 6,745 - (665,801) - (665,801) - (665,801) (829,057) Primary and secondary education 17,883,044 - - - (17,883,044) - (17,883,044) - (17,883,044) (16,007,893) Interest on long-term debt 924,391 - 5,872,228 - 4,947,837 - 4,947,837 - 4,947,837 13,917,356 Total governmental activities 24,954,592 968,160 5,819,357 140,372 (18,026,703) - (18,026,703) - (18,026,703) (8,618,953) Business -type activities: Municipal solid waste collection and disposal 2,830,797 4,120,050 (20,914) - - 1,268,339 1,268,339 - 1,268,339 757,931 Hospital facilities 1,374,719 1,451,382 - - - 76,663 76,663 - 76,663 389,364 Long Term Care Center 561,395 1,199,644 - - - 638,249 638,249 - 638,249 700,249 Kodiak Fisheries Research Center 1,354,889 927.289 (7,339) - - (434,939) (434,939) - (434,939) (338,606) 911 service 326,034 - - - - (326,034) (326,034) - (326,034) (301,236) Research court apartments 78,891 94,755 - - - 15,864 15,864 - 15,864 2,937 Total business -type activities 6,526,725 7,793,120 (28,253) - - 1,238,142 1,238,142 - 1,238,142 1,210,638 Total primary government 31,481,317 8,761,280 5,791,104 140,372 (18,026,703) 1,238,142 (16,788,561) - (16,788,561) (7,408,315) Component unit. School District $ 48,560,814 153,025 8,269,487 70,655 (40,067,647) (40,067,647) (38,404,999) General revenues: Property taxes 18,130,369 - 18,130,369 - 18,130,369 17,607,487 Grants and entitlements not restricted to specific programs 3,892.080 - 3,892.080 34,330,209 38,222,289 36,506,630 Land sales 5,448 - 5,448 - 5,448 4,791 Severance rues 1,719,343 - 1,719,343 - 1,719,343 1,779,042 Excise taxes 829,274 - 829,274 - 829,274 683,971 Support from primary government - - - 11,955,244 11,955,244 10,456,142 Investment earnings (loss) 951,821 126,482 1,078,303 - 1,078,303 (3,658,268) Gain on disposal of capital assets 11,157 - 11,157 - 1 L 157 - Other 730,209 392,860 1,123,069 31,905 1,154,974 896,550 Total general revenues 26.269701 519,342 26,789,043 46,317,358 73,106,401 64,276,345 Change in net position 8.242,998 1,757,484 10,000,482 6,249,711 16,250,193 18,463,031 Net position, at beginning ofyear 155,713,293 53,928,425 209,641,718 62,786 209,704,504 191,241,473 Net position, at end ofyear $ 163,956,291 55,685,909 219,642,200 6,312,497 225,954,697 209,706,504 See accompanying notes to financial statements. 30 ✓� alB�a 4i � hi �' rr"^" r- r� r"_ r-"" r„"", r.... r" ' III"tlal" ^ '_1 """ "'" "a'""1 "waaaal -"'1 n"""1 `"1 Assert Assets. Equity in central treasury Receivables: State of Alaska Federal government Property taxes, net of allowance of $18,851 Severance taxes Excise taxes Interest Land sales contracts, due within one year Accounts and other receivables Prepaid items Due from KIBSD Due from other funds Land sales contracts, due after one year Total assets Liabilities, Deferred Inflows of Resources, and Fund Balances Liabilities: Accounts payable Accrued compensatlon and related liabilities Customer deposits Due to component unit Due to other funds Unearned revenues Total liabilities Deferred inflows of resources - Unavailable revenues Total liabilities and deferred inflows of resources KODIAK ISLAND BOROUGH Balance Sheet Governmental Funds June 30, 2023 (With summarized financial information for lune 30, 2022) 201,608 9,137 State Capital 414,578 631,138 763,%6 105,511 Special Revenue Funds Educafion Grants Other 105,511 156,813 - Education Debt Service Capital Project Governmental 3,348 Totals General Support Facilities Fund Fund Funds 2023 2022 $ 19,069,921 17,369,347 39,911,999 380,229 4,793,134 18,303,185 99,827,815 80,095,433 19,030 - - 303,053 - - 322.083 12,547,411 - - - - 18,128 5,184 23,312 5,437 58,254 149.092 - 30,687 - 28,424 266,457 229.455 169,179 - - - - - 169,179 365,105 193,227 - - - - - 193,227 268,549 633.323 - - - - - 633,323 264,769 - - - - - 12,075 12,075 11,015 63.595 - - - - 33,409 97,004 %,014 120,671 - - - - 1.145 122.416 51,838 - - - - - - - 313,444 - - - - - - - 23,189 27,905 27,905 39,057 $ 20.327,200 17,518,439 39,911,999 713,969 4,811,262 18,411,927 101694,796 94,310,716 201,608 9,137 - - 5,815 414,578 631,138 763,%6 105,511 - - - - - 105,511 156,813 - - - - - - 3,348 3,348 1,450 - - 17.566,532 - - - - 17,566,532 18,261,872 - - - - - - - 23,189 2,417,855 5,329,401 45,928,606 4,359,781 29,600 6,807,236 3,453,794 2,724,974 - 17,575,669 4,365,596 447,526 25,113,765 22,661,084 8,650,120 Unassigned 17,430,159 (185,907) 51,396 (7,226) 128,677 26,763 65,532 272,368 273,588 2,776,370 39,911,999 17,704,346 26,763 4,365,596 513,058 25,386,133 22,934,672 Fund balances: Nonspendable 120,671 - - - - 1,745 122,416 51,838 Restricted - - - - - 54.247 54,247 47,010 Committed - - 39,911,999 687,206 - 5,329,401 45,928,606 54,580,464 Assigned - - - - 445,666 12,520,702 12,966,368 8,650,120 Unassigned 17,430,159 (185,907) (7,226) 17,237,026 8,046,612 Total fund balances 17,550,830 (185,907) 39,911,999 687,206 445,666 17,898,869 76,308,663 71,376,044 Total liabilities, deferred inflows ofresources and fund balances $ 20,327,200 17,518,439 39,911.999 713,969 4,811,262 18,411.927 101,694,796 94,310,716 See accompanying notes to financial statements. 31 KODIAK ISLAND BOROUGH Reconciliation of Net Position Between the Government -Wide Financial Statements and the Fund Financial Statements June 30, 2023 Amount reported as fund balances on the governmental funds balance sheet $ 76,308,663 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. 141,034,627 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 $ 232,388 Notes receivable - land sales 39,980 272,368 Long -tern 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 (49,855,000) Bond premium (2,111,107) Deferred outflow - bond premium 174,992 Accrued interest expense (226,838) Compensated absences (209,309) (52,227,262) Deferred outflows of resources represent costs applicable to future periods, and therefore, are not reported in the governmental funds: Deferred outflows related to pension and OPEB 563,474 Deferred inflows of resources represent resources or benefits applicable to future periods, and therefore, are not reported in the governmental funds: Deferred inflows related to pension and OPEB (114,441) Proportionate share of the collective OPEB assets 1,267,634 Proportionate share of the collective net pension liabilities (3,148,772) Net position of governmental activities $ 163,956,291 See accompanying notes to financial statements. 32 rKOBUK ISLAND BOROUGH LSee accompanying notes to financial statements L L L L 33 Statement of Revenues, Expenditures and Changes in Fond Balances Governmental Funds Year ended Jose 30, 2023 (With summarized financial information for the year ended June 30, 2022) [[r k State Capital Special Revenue Funds Education Edueatias Debt ServiceCapital Grants Project Other Governmental Totals General Support Facilities Fund Fund Funds 2023 2022 Revenues Property taxes and assessments S 2,051,768 11,926,820 - 2,061,217 - 2,081,692 18,121,497 17,655,437 Transient accommodations tax Severance taxes -- 159],32] _ _ = 122,016 122,016 1,597,327 101,447 1,677,595 Excise nixes 829,270 829,274 683,971 Intergovernmental State sources 1959,400 - - 5,872,228 - 10,815 7,842,443 16,151,993 Federal sources 1984,35] - - - 135,03] 5,335 2,124,729 2,492,033 r - 527 839,169 839,696 840,762 LicensxforSmvices tees Licensar'xsfpermit an ]6,164 - 37,200 113,364 96,575 I Investment income (loss) 422,783 _ _ _ 426,116 102,922 951,821 (2,822,026) Rentals 15,100 15,100 8,400 Other 10,666 6,230 713,313 730,209 534,249 Total revenues 8,932,266 11,926,820 426,116 7,933,445 141,267 3,927,562 33,287,476 37,420,436 Expenditures: Curren General government 4,381980 - - 3,159 - 677,435 5,062,574 5,017,074 Public safety 150,430 - - - - 574,875 725,305 543,862 Community and economic development 699,370 - - 138,828 105,886 944084 1,514,49 Emergency preparedness 16,460 _ 16,460 10,983 Health and somal welfare 150,000 150,000 169,647 Education, culture and recreation 20,562 - - - - - 20,562 20,396 Forks and recreation 12,760 - - - - -12,760 22,125 Service district maintenance - - - - - 700,146 700,146 856,657 Primary and secondary education 79,965 11,955,294 - - - - 12,035,259 10,521511 Capiml ou0ay: Schools - - - - - 461,278 461,278 137,568 General - - - - - 686,810 686,810 516,580 Debt service: Principal 6,035,000 6,035,000 5,840,000 Interest Interest - - - 1,531,316 - - 1531,316 1119,024 Total expenditures 5,511 527 11,955,2w - 7,569,475 138,828 3,206.430 28,381 554 26,889,876 Excess (deficiency) ofrevenues overexpesditores 3,420,739 (28,474) 426,116 363,970 2,439 721,132 4,905,922 10,530560 left Other financing sources (uses) Land sale proceeds 15,540 15,540 15,440 Proceeds from sale of capital asse6 - - - - - 11,157 11,157 - Transfersin 5,879,272 - 2,213,366 - - 4,352,343 12,4 ,981 4,290,585 Transfers out - - (12,139,940) (305,041) (12,944,981) (4,290,585) Net other financing _ _ sources (uses) 5,879,272 2,213,366 (12,139,940) 4,073,999 26,697 15,440 Change in fund balances 9,301011 (28474) 2,639,482 (11,775,970) 2,439 4,795,131 4,932,619 10,546,000 Fund balances (deficit), at beginong ofyear 8,250,819 (157,433) 37,272,517 12,463,176 443,227 13,103,738 71,376,(W 60,830,044 L Fund balances (deficit), at end ofyear S 17550,830 (185,907) 39,911,999 667,206 445,666 17,898,869 76,308,663 71,376,044 LSee accompanying notes to financial statements L L L L 33 KODIAK ISLAND BOROUGH Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year ended June 30, 2023 Change in fund balances–total governmental funds 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 Depreciation expense 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. This is the net effect of transactions involving capital assets: Cost of assets disposed Accumulated depreciation of assets disposed 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 Land sale proceeds Certain revenues that were earned in a prior year provide current financial resources: Accrued property tax Land sale contracts 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 Principal repayments Bond premium amortization 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 Change in the proportionate share of the collective net pension liabilities Change in the proportionate share of the collective OPEB assets Change in deferred outflows related to bond refunding Change in deferred inflows related to bond refunding Change in deferred outflows related to pension and OPEB Change in deferred inflows related to pension and OPEB Change in net position of governmental activities See accompanying notes to financial statements. LTJ Ill I 4,932,619 a I $ 1,668,229 a (6,677,627) (5,009,398) a (696,389) a 696,389 — (483,609) a 232,388 a 39,980 272,368 a (223,516) (50a (50,072) (273,588) 2,339,953 1,654,743 I 57,299 a 6,035,000 573,955 6,666,254 a (57,196) a (97,055) (483,609) (174,993) a 150,664 (23,021) 2,339,953 1,654,743 a $ 8,242,998 a 34 a F F F I I I L L L L L L Assets and Deferred Outflows of Resources Current assets: Equity in central treasury Receivables Cusmmers Leases Conant portion of note receivable Prepaids Total current assets Restricted cash and equivalents Inventories Capital assets. Non -depreciable Depreciable, net Total capital assets Notes receivable Net pension and OPEB assets Total noncurrent assets Total assets Deferred outflows of resources: Pension and OPEB deferrals Total assets and deferred Outflows ofresomces Liabilities, Deferred Inflows of Resources and Net Position Current liabilities. Accounts payable Customer deposits Current portion of accrued compensation and related liabilities Uneamed revenues Interest payable Current portion ofnotes and bonds payable Total current liabilities Noncurrent liabilities: Accrued compensation and related liabilities Notes and bonds payable Accrual for landfill closure and proteins. costs Net pension and OPEN liability Total noncurrent liabilities Total liabilities Deferred inflows ofresources: Leases Related to bond refunding Pension and OPEB deferrals Total defined inflows ofresomces Net position: Net investrnent in capital assets Restricted for debt service Unrestricted Total net position Total liabilities, deferred inflows ofresomces and net position See accompanying nates to financial statements. KODIAK ISLAND BOROUGH Statement of Net Position Proprietary Fonds - Business - Type Activities - Enterprise Fonds June 30, 2023 (With summmiaed financial infonnmion for June 30, 2022) Municipal Kodiak Other Solid Waste Fisheries Nonmajor Collection aad Hospital Long Term Research Enterprise Totals Disposal Facilities Care Center Center Funds 2023 2022 g 2,810,488 5,874,407 2,536,697 2,608,862 220,863 14,051,317 16,488,380 383,852 - - 55,429 38,606 477,887 480,658 - 5,009,098 8,356,656 6,315,421 - 19,681,175 21,776,383 - - - 140,763 - 140,763 135,928 2,621 1,561 4,182 3,196,961 10,883,505 10,893,353 9,122,036 259,469 34,355,324 38,881349 322,966 - 1,051088 - - 1,374,054 1,329,430 2,314,593 - - - - 2,314,593 98,147 33,716,529 444,810 89,638 460,864 - 34,711,841 33,999,032 3,074,362 10,589,834 11,892,211 5,186,246 204,399 30,947,052 30,521048 36,790,891 11,034,644 11,981,949 5,647,110 204,399 65,658,893 6,520,880 - - - 740,107 - 740107 880,870 437,578 133,272 570,850 1,325,804 39,866,028 11034,644 13,032,937 6,520,489 204,399 70,658,497 68,155,131 43,062,989 21 918,149 23,926,290 15,642,525 463,868 105,013,821 107,036,480 194,507 59,240 253,747 136,549 S 43257,496 21 918,149 23,926,290 15,701,165 463,868 105,267,568 10],173,029 S 2,118,201 - - 110,195 124,388 2,352,784 332,299 2,959 - - 30,298 7,653 40,910 ]6,26] 25,692 - - 2,604 - 28,296 26,732 - 115,356 86,969 15,270 6,400 223,995 217,595 47,896 - 9,601 - - 57,497 63,990 1,130,905 - 740,000 - - 1,870,905 1,893,715 3,325,653 115,336 836,570 158,367 138,44] 4,574,387 2,610,598 90,151 - - 3,857 - 94,008 125,404 11,295,980 - 7,105,000 - - 18,400,980 20,271,885 6,693,000 - - - - 6,693,000 7,189,000 1,086,931 - - 331,043 - 1417,974 1,195,627 19,166,062 - 7,105,000 334,900 - 26,605,962 28,781916 22,491,715 115,356 7,941,570 493,267 138,441 31,180,349 31,392,514 - 4,683,232 ],843,1]1 5,823,371 - 18349,774 20,815,825 - - - - - - 141,542 39,504 12,032 51,536 894,723 39,504 4,683,232 7,843,171 5,835,403 18,401 310 21,852,090 24,364,006 11034,644 4,136,849 5,64],110 204,399 45,387,008 43,543,168 322,966 - 1,051,088 - - 1,374,054 1,329,430 (3,960695) 6,084,917 2,953,612 3,725,985 121,028 8,924847 9,055,827 20,726,277 17,119,561 8,141 549 9,373,095 325,427 55,685,909 53,928,425 $ 43,257,496 2L918,149 __L3.926 290 15,701765 463,868 105,267,568 107,173,029 35 KODIAK ISLAND BOROUGH Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds - Business - Type Activities- Enterprise Fonds Year ended June 30, 2023 ( With summarized financial information for the year ended lune 30, 2022) See accompanying notes to financial statements. 36 Municipal Kodiak Other Solid Waste Fisheries Nonmaior Collection and Hospital Long Term Research Enterprise Totals Disposal Facilities Care Center Center Funds 2023 2022 Operating revenues: Charges for services: Solid waste disposal S 4,120,050 - - - - 4,120,050 4,161,775 Lease income - 1,170,808 765,187 566,318 94,755 2,597,068 2,587,923 Interest evenue - 280,574 434,457 360,971 - 1.076,002 1,324,106 Other 14,102 325,981 340,083 317,012 Total operating revenues 4,134,152 1,451,382 1,199,644 927,289 420,736 8,133,203 8,390,816 Operating expenses: Personnel services 1,323,342 44,026 1,832 168,922 7,593 1,545,715 1,316,121 Contracted services 292,008 - 4,856 - - 296,864 295,058 Maintenance and repairs 277,754 266 - 32,639 659 311,318 129,506 Depreciation 235,004 1,326,227 518,933 719,871 34,067 2,834,102 2,480,104 General and administration 405,399 - 35,774 369,220 33,042 843,435 826,674 Miscellaneous - 4,200 - 64,237 5,362 73,799 59,739 Telephone services 324,202 324,202 299,459 Recycling services 330,396 330,396 310,560 Closure and postclosure costs (reduction) (377,580) (377,580) 687,590 Contributions 169,935 169,935 182,639 Total operating expenses 2,656,258 1,374,719 561,395 1,354,889 404,925 6,352,186 6,587,450 Operating income (loss) 1,477,894 76,663 638,249 (427,600) 15,811 1,781,017 1,803,366 Nonoperating revenues (expenses). Inurgovemmental: State of Alaska (20,914) - - (7,339) - (28,253) (37,904) Investment income (loss) (26,417) 61,084 66,264 23,524 2,027 126,482 (836,242) Interest revenue - - 52,777 - - 52,777 Interest expense (174,539) - (174,539) (237,812) Total nonoperating revenues(expenses) (221,870) 61,084 119,041 16,185 2,027 (23,533) (1,111,958) Change in net position 1,256,024 137,747 757,290 (411,415) 17,838 1,757,484 691,408 Net position. at beginning ofyem 19,470,253 16,981,814 7,384,259 9,784,510 307,589 53,928,425- 53,237,017 Net position. at end ofyear $ 20,726,277 17,119,561 8,141,549 9,373,095 325,427 55,685909 53,928,425 See accompanying notes to financial statements. 36 r r Cash flows from operating activities: Cash received from customers Payments to suppliers Payments to employees Net cash provided by operating activities Cash Bows from capital and related financing activities: Acquisition and construction of capital assets Interest paid on notes and bonds payable Issuance of refunding bond payable Principal payments on notes and bonds payable Net cash (used) by capital and related financing activities Cash flows from investing activities: Interest and dividends received Net change in cash and r cash equivalents 1 Cash and equivalents, at beginning of year Il Cash and equivalents, at end of year Reconciliation of cash and cash equivalents rto the Statement of Net Position: Il Equity in central treasury Restricted cash and equivalents Reconciliation of operating income (loss) to net cash provided by operating activities: Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation Noncash State PERS on -behalf payments Closure and postclosure costs Changes in assets and liabilities that provided (used) cash (Increase) decrease in assets and deferred outflows of resources: Customer receivables Lease receivable Inventories Prepaids Notes receivable Net pension and OPEB assets Deferred outflow of resources: LRelated to bond refundings Pension and OPER Increase (decrease) in liabilities and deferred inflows of resources L Accounts payable Customer deposits Accrued compensation Unearned revenues Net pension and OPEB liabilities LDeferred inflow of resources: Related to bond refundings Pension and OPEB Leases Net cash provided by Operating activities See accompanying notes to financial statements. flr L KODIAK ISLAND BOROUGH Statement of Cash Flows Proprietary Funds - Business -Type Activities - Enterprise Funds Year ended June 30, 2023 (With summarized financial information for the year ended Jane 30, 2022) Municipal Solid Waste Kodiak Other Collection Long Term Fisheries Nonmajor and Hospital Care Research Enterprise Totals Disposal Facilities Center Center Funds 2023 2022 S 4,138,756 1,384,272 1,808,815 1,409,199 426,303 9,167,345 9,326,194 (1,867,446) (4,641) (947,361) (928,465) (357,384) (4,105,297) (3,508,752) (1,278,377) (44,026) (1,832) (255,056) (7,593) (1,586,884) (1,540,110) 992,933 1,335,605 859,622 225,678 61,326 3,475,164 4.277,332 (3,510,302) (168,336) (23,250) (270,227) - (3,972,115) (2,635,335) (178,812) - (2,220) - - (181,032) (114,736) (147,477) (1,120,905) - (772,810 - - (1,693,715) (2,350,926) (4,810,019) (168,336) (798,280) (270,227) - (6,046,862) (5,248,474) (26,417) 61,084 119,041 23,524 2,027 179,259 (836,242) (3,843,503) 1,228,353 180,383 (21,025) 63,353 (2,392,439) (1,807,384) 6,976,957 4,646,054 3,407402 2,629,887 157,510 17,817,810 19,625,194 $ 3,133,454 5,874,407 3,587.785 2,608,862 220,863 15,425,371 17,817,810 S 2,810488 5,874407 2,536,697 2,606,862 220,863 14,051,317 16,488,380 322,966 1,051,088 1,374,054 1329,430 S 3,133,454 5,874,407 3,587,785 2,608,862 220,863 15,425,371 17,817,810 $ 1,477,894 76,663 638,249 (427,600) 15,811 1,781 017 1,803,366 235,004 1,326,227 518,933 719,871 34,067 2,834,102 2,480,104 (20,914) - - (7,339) - (28,253) (37,904) (496,000) (496,000) 630,000 3,604 (833) 2,771 25,016 - 1,103,698 609,171 382,339 - 2,095,208 1,992,768 (2,216,446) (2,216,446) 56,118 (2,621) - - (1,561) - (4,182) - - - - 135,928 - 135,928 131,260 750 - - 754,204 - 754,954 (1,214,965) 156,911 (107,736) - - (9,462) - (117,198) 59,976 1,945,533 (175) - 69,246 5,881 2,020,485 (353,645) 1,000 - - (36,357) - (35,357) (40,357) (2,896) - - (26,936) - (29,832) 9,453 - - - - 6,400 6,400 (2,501) 860,548 - - (638,201) - 222,347 202,185 (141,542) - - (141,542) 88,328 (684,787) - - (158,400) - (843,187) 757,266 - (1,170,808) (765,189) (530,054) - (2,466,051) (2,466,047) $ 992.933 1 335 605 859,622 225.678 61 326 3 475 164 4 277 332 37 m C III LJ 0 HI (This page was left blank intentionally.) o w I I L Ft L L II 11 1 1 I l KODIAK ISLAND BOROUGH rNotes to Basic Financial Statements Year Ended June 30, 2023 (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. Kodiak Island Borough School District 722 Mill Bay Road Kodiak, Alaska 99615 L(b) Government -Wide and Fund Financia! Statements l 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. LGovernmental 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. L I L38 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 t t 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 statements is as of and for the fiscal year ended June 30, 2023. 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 L(b) Government -Wide and Fund Financia! Statements l 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. LGovernmental 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. L I L38 (C) KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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 D 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 a 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 assets by the Borough that are applicable to a future reporting period. Deferred outflows of resources are the consumption of fund balance / net assets that are applicable to a future reporting period. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government -wide and proprietary fund 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 R, collectible within the current period or soon enough thereafter to pay liabilities of the current period. IIJI 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. [I] ■d 39 0 F KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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 the Kodiak Island Borough School District in support of primary and secondary education services. 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 State Capital Grants Capital Project Fund accounts for capital improvement projects relating r II to grants received from the State of Alaska. 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 metal 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 and other hospital related revenue. f The Long Term Care Center Fund was created in fiscal year 2017 to account for the rents on the tL Borough owned Long Tenn Care Center and debt service payments on related debt. These activities were accounted for in the Hospital Facilities Fund until completion of the Long Tenn Care Center. The Kodiak Fisheries Research Center Fund accounts for rents and expenses on the Borough owned Kodiak Fisheries Research Center. Multiple tenants pay lease funds to participate in this multi -agency research facility committed to the preservation of the North Pacific marine ecosystem and resources. As a general rule the effect of inter -fund activity has been eliminated from the government -wide financial statements. Exceptions to this general rule are charges between various functions of the L 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 Lrevenues. Likewise, general revenues include all taxes. L40 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Treasury". 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. Fund (d) Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Balance/Net Position for fair value by an independent pricing service. a 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. 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 fav value: (1) cash and cash equivalents, (2) receivables, net, (3) certain other current assets, (4) accounts payable, and (5) other current liabilities. o 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 a investments are determined based on quoted market prices. 41 a rKODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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. rReceivables 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 rreported in the government wide financial statements as "internal balances." C 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. 1 Leases I L L L The Borough is a lessor for non -cancellable leases and recognizes a lease receivable and a deferred inflow of resources in the financial statements. At the commencement of a lease, the Borough initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term. Key estimates and judgments include how the Borough determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. a. The Borough uses its current borrowing rate as the discount rate for leases. b. The lease term includes the non -cancellable period of the lease; the term of the lease contract, including options to extend, must be more than 12 months. Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee. The Borough monitors changes in circumstances that would require a remeasurement of its leases and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. 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. 42 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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. 43 F KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued r Pension and Other Postemployment Benefits (OPEB) For purposes of measuring the net pension and OPEB assets and 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 l 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 r those assets. l • 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. �. 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 L 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. L44 (e) KODIAK ISLAND BOROUGH 0 Notes to Basic Financial Statements, Continued 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 �y governmental fund, other than the General Fund, has a fund balance deficit, then it will be reported as 1LJ1 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 a incurred for which both restricted and unrestricted fund balance is available should fist 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. d 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 'd 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 tj a planning process. a The Borough's Special Revenue Funds are used to account for Borough support, fire and road service a areas, federal and state grant programs, street lighting, and operations and maintenance programs that are restricted or committed. Revenues, Expenditures, and Expenses Q Property Taxes n Property taxes are based on the assessed value of taxable property as of January 1. Pursuant to Alaska IIl1' Statute 29.45.240, the Borough establishes the mill rate on or before June 15th. Tax bills are then mailed on or before July 1 st. O 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. 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. tj a Real property tax liens are enforced by one general foreclosure proceeding against the delinquent properties. a I 45 a KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Prior to FY2012 all area wide property taxes were deposited into the General Fund and then transferred F 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 FY2023 the Borough set a mill rate of 1.18 mills for the General Fund, 7.88 mills for the Education Support Special Revenue Fund, 1.36 mills for the Education Debt Service Fund, and 0.33 mills for the Renewal and Replacement Special Revenue Fund for a total area wide mill rate of 10.75. This was the same total area wide mill rate as FY2022. [ 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. I Excise Taxes Excise taxes are based on the quantity of tobacco brought into the Borough and the quantity of marijuana cultivated for sale. Quarterly excise tax returns for tobacco are due by the end of the month following the quarter's end and monthly excise reports for marijuana are due by the end of the month for the previous month. Borough excise 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. LOperating and Nonoperating Revenue and Expenses Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating L 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 are charges to customers for services. The L principal operating revenues of the Hospital Facilities Fund, Long Term Care Center Fund, Kodiak Fisheries Research Center Fund, and Research Court Apartments Fund are rents from customers. The principal operating revenues for the 911 Service Fund are surcharges collected on phone lines. 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. 46 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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. (n 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. (2) Stewardship, Compliance, and Accountability (a) Excess of Expenditures over Appropriations The following fund expenditures or operating expenses exceeded their budget: Fund Excess Special Revenue Funds: Education Support $ 50 Fire and Road Service Areas: Womens Bay Fire Department 90,128 Kodiak Airport Fire District 1,914 Womens Bay Road Service Area 25,684 Bay View Road Service Area 21,196 Toursim Development 30,666 Enterprise Funds: 911 Service 31,034 These excesses were funded by available fund balance or net position. 47 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (b) Deficit Fund Equity The individual fund deficits at June 30, 2023, are as follows: Education Support Special Revenue Fund $ 7,226 Womens Bay Road Service Area Special Revenue Fund 185,907 The deficit in these funds will be funded by transfers from the General Fund in future years. (3) Cash and Investments (Equity in Central Treasury) A portion of the Borough's investments are in the Alaska Municipal League Investment Pool (AMLIP). The r investment in AMLIP represents the Borough's share of ownership in the pool rather than ownership of Ispecific securities. The share value of investments in the AMLIP is approximately equal to fair value. To obtain a copy of AMLIP's financial statements contact Key Trust of Alaska at 101 West Benson Blvd., Room 412, Anchorage, Alaska 99503. L L Alaska Municipal League Investment Pool Certificates of Deposit Money Market Funds Total investments 3,664,315 23,347 2,161,745 5,849,407 $ 110,607,997 In addition to the investments listed above, Kodiak Island Borough also had cash equivalents of $4,645,189, which includes restricted cash of $1,374,054. 48 As of June 30, 2023, the Borough had the following investments: Investment Maturities (in years) L L Fair Less Investment Type Value than 1 1 to 5 6+ U.S. Agency Securities: Federal Home Loan Bank $ 51,803,972 12,230,086 39,573,886 - Federal Home Loan Mortgage Corporation 18,498,230 2,959,880 15,538,350 - Federal Farm Credit Bank 21,621,375 13,313,505 7,442,460 865,410 Federal Agriculture Mortgage Corporation 4,786,760 2,945,960 1,840,800 - Federal National Mortgage Association 996,160 996,160 - _ Corporate Obligations 935,720 935,720 Municipal Obligations 6,116,373 852,101 4,059,772 1,204,500 $ 104,758,590 33,297,692 69,390,988 2,069,910 Investments measured at amortized cost: L L Alaska Municipal League Investment Pool Certificates of Deposit Money Market Funds Total investments 3,664,315 23,347 2,161,745 5,849,407 $ 110,607,997 In addition to the investments listed above, Kodiak Island Borough also had cash equivalents of $4,645,189, which includes restricted cash of $1,374,054. 48 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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's investments that are classified as Level 2 are valued using third party pricing models provided by investment brokerages. The Borough has the following recurring fair value measurements as of June 30, 2023: Investments by fair value level: Debt securities: U.S. Agency Securities Corporate Obligation Municipal Obligations Total investments at fair value level Total Level ] Level 2 Level 3 $ 97,706,497 97,706,497 - 935,720 - 935,720 6,116,373 6,116,373 $ 104,758,590 97,706,497 7,052,093 Investments measured at amortized cost: Alaska Municipal League Investment Pool 3,664,315 Money Market 23,347 Certificates of Deposit 2,161,745 Total investments $ 110,607,997 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, 2023, the Borough's investments in municipal obligations, U.S. Government agencies or instruments implicitly guaranteed by the U.S. Government, and corporate obligations were rated as follows: Moodv's AAA 74% Al 2% AA 2% AA+ 6% AA 1 2% AA2 2% AA3 4% S&P — AAAm 2% Not Rated 6% 100% 49 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued r At June 30, 2023, the Borough's investments in the Alaska Municipal League Investment Pool were rated e AAAm by Standard & Poor's and the Borough's 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, 2023, the Borough had 88% percent of its investments in U.S. Government Agency Securities and 6% in Municipal Obligations. I L L L L 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. As of June 30, 2023 the Borough had $500,454 of uninsured and uncollateralized bank balances. 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, 2023. (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. The remainder of this page left blank intentionally. 50 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (5) Receivables Governmental Funds Education Education State Capital Other General Support Special Debt Grants Capital Governmental Fund Revenue Fund Service Fund Project Fund Funds Receivables: Leases - Grants 19,030 - 303,053 18,128 5,184 Taxes 424,828 159,530 32,859 - 30,497 Interest 633,323 Customers and other 63,595 33,409 Notes receivable 39,980 Gross receivables 1,140,776 159,530 335,912 18,128 109,070 Less: allowance for uncollectibles (4,168) (10,438) (2,172) - (2,073) Net total receivables $ 1,136,608 149,092 333,740 18,128 106,997 Enterprise Funds Municipal Kodiak Total Solid Waste Fisheries Governmental Collection Hospital Long Term Research Funds and Disposal Facilities Care Center Center Receivables: Leases $ 5,009,098 8,356,656 6,315,421 Grants 345,395 - - - - Taxes 647,714 Interest 633,323 - - - - Customers and other 97,004 383,852 55,429 Notes receivable 39,980 880,870 Gross receivables 1,763,416 383,852 5,009,098 8,356,656 7,251,720 Less: allowance for uncollectibles (18,851) Net total receivables $ 1,744,565 383.852 5.009.098 8.356.656 7.251.720 Enterprise Funds Other Nonmajor Total Total Enterprise Enterprise Primary Fund Funds Government Receivables: Leases $ - 19,681,175 19,681,175 Grants 345,395 Taxes 647,714 Interest 633,323 Customers and other 38,606 477,887 574,891 Notes receivable - 880,870 920,850 Gross receivables 38,606 21,039,932 22,803,348 Less: allowance for uncollectibles (18,851) Net total receivables $ 38,606 21,039,932 22,784,497 51 II r r r L L L L C L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (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, 2023, the principal balance due is $880,870 and the principal amount due within one year is $140,763. 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, 2023, the various components of deferred inflows of resources and unearned revenue reported in the governmental funds were as follows: The remainder of this page left blank intentionally. 52 Unavailable Unearned Total Unavailable taxes receivable $ 232,388 232,388 Unavailable land sales receivable 39,980 - 39,980 Grant advances prior to expending all proceeds - 6,807,236 6,807.236 Total unavailable/unearned revenue for governmental funds $ 7.079.604 The remainder of this page left blank intentionally. 52 KODIAK ISLAND BOROUGH a Notes to Basic Financial Statements, Continued (8) Capital Assets II 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 lease assets and associated depreciation are reflected in the Hospital 32,017,094 Facilities Fund and Long Term Care Center Fund following. 4,056,878 Capital asset activity for the year ended June 30, 2023 was as follows: (696,389) Beginning Increase/ Ending Balance Transfers Decrease Balance 53,728 Governmental activities: a Capital assets, not being depreciated Land $ 22,752,807 - 22,752,807 Construction work -in -progress 5,297,991 728,279 (4,751,574) 1,274,696 a Total 28,050,798 728,279 (4,751,574) 24,027,503 Capital assets, being depreciated: Buildings and improvements Improvements other than buildings Equipment Infrastructure Total Less accumulated depreciation for: Buildings and improvements Improvements other than buildings Equipment Infrastructure Total Total capital assets being depreciated, net Total governmental activities, net 195,583,696 4,134,698 199,718,394 0 32,017,094 - 32,017,094 a 4,056,878 1,503,098 (696,389) 4,863,587 5,762,722 53,728 5,816,450 237,420,390 5,691,524 (696,389) 242,415,525 a 92,459,745 4,505,465 96,965,210 a 18,287,854 1,775,786 20,063,640 3,106,649 319,781 (696,389) 2,730,041 Q 5,572,915 76,595 5,649,510 119,427,163 6,677,627 (696,389) 125,408,401 117,993,227 (986,103) 117,007,124 a $ 146,044,025 (257,824) (4,751,574) 141,034,627 n 1 iI 53 0 r r r r r 1 I L L L L L L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Business -type activities: Municipal Solid Waste Collection and Disposal Fund capital assets, not being depreciated Land Construction work -in -progress Total Capital assets, being depreciated: Unclassified utility plant in service Improvements other than buildings Machinery and equipment Total Less accumulated depreciation for: Unclassified utility plant in service Improvements other than buildings Machinery and equipment Total Total capital assets being depreciated, net Total Municipal Solid Waste Collection and Disposal Fund, net Beginning Increase/ Ending Balance Transfers Decrease Balance $ 1,651,248 - 1,651,248 29,234,507 2,830,774 32,065,281 30,885,755 2,830,774 33,716,529 2,178,733 - 2,178,733 4,272,325 - - 4,272,325 2,295,885 679,528 - 2,975,413 8,746,943 679,528 - 9,426,471 1,547,906 42,055 - 1,589,961 2,687,268 125,059 - 2,812,327 1,881,931 67,890 - 1,949,821 6,117,105 235,004 - 6,352,109 2,629,838 444,524 - 3,074,362 $ 33,515,593 3,275,298 36,790,891 The remainder of this page left blank intentionally. 54 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Hospital Facilities Fund: Capital assets, not being depreciated Artwork Land Construction in progress Total Capital assets, being depreciated: Buildings Improvements other than buildings Machinery and equipment Total Less accumulated depreciation for: Buildings Improvements other than buildings Machinery and equipment Total Total capital assets being depreciated, net Beginning Increase/ Balance Transfers Decrease Iii Ending 0 n-1---- $ 16,091 16,091 10,251 - - 10,251 2,829,910 168,336 2,579,778 418,468 2,856,252 168,336 2,579,778 444,810 33,100,284 2,579,778 - 35,680,062 401,046 - - 401,046 3,632,024 73,095 3,558,927 n 37,133,354 2,579,778 73,095 39,640,037 23,903,312 870,087 24,773,399 Q 313,126 440,011 - 753,137 a 3,580,633 16,129 73,095 3,523,667 27,797,071 1,326,227 73,095 29,050,203 9,336,283 1,253,552 10,589,834 0 Total Hospital Facilities Fund, net $ 12,192,535 1,421,888 2,579,778 11,034,644 a Long Term Care Center Fund: Capital assets, not being depreciated Construction in progress $ 66,388 23,250 89,638 Capital assets, being depreciated: Buildings Less accumulated depreciation for: Buildings Total capital assets being depreciated Total Long Term Care Fund, net 15,567,986 3,156,842 518,933 12,411,144 (518,933) $ 12,477,532 (495,683) 15,567,986 a 3,675,775 11,892,211 11,981,849 55 0 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Kodiak Fisheries Research Center Fund: Capital assets, not being depreciated Construction in progress Capital assets, being depreciated: Buildings Improvements other than buildings Machinery and equipment Total Less accumulated depreciation for: Buildings Improvements other than buildings Machinery and equipment Total Total capital assets being depreciated, net Total Kodiak Fisheries Research Center Fund, net Research Court Apartments Fund: Capital assets being depreciated: Buildings Less accumulated depreciation: Buildings Total Research Court Apartments Fund, net Beginning Increase/ Ending Balance Transfers Decrease Balance $ 190,637 270,227 - 460,864 17,840,410 - - 17,840,410 1,884,546 - - 1,884,546 1,501,764 - - 1,501,764 21,226,720 - - 21,226,720 13,675,886 594,681 - 14,270,567 423,013 93,781 - 516,794 1,221,704 31,409 - 1,253,113 15,320,603 719,871 - 16,040,474 5,906,117 (719,871) - 5,186,246 $ 6,096,754 (449,644) 5,647,110 $ 1,021,998 - 1,021,998 783,532 34,067 817,599 $ 238,466 (34,067) 204,399 56 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Total business -type activities: Capital assets, not being depreciated: Artwork Land Construction work -in -progress Total Capital assets, being depreciated: Unclassified utility plant in service Buildings Improvements other than buildings Machinery and equipment Total Less accumulated depreciation for: Unclassified utility plant in service Buildings Improvements other than buildings Machinery and equipment Total Total capital assets being depreciated, net Total business -type activities, net Beginning Ralance $ 16,091 1,661,499 32,321,442 33,999,032 2,178,733 67,530,678 6,557,917 7,429,673 83,697,001 1,547,906 41,519,571 3,423,406 6,684,270 53,175,153 Increase/ Transfers Decrease 3,292,587 (2,579,778) 3,292,587 (2,579,778) 2,579,778 679,528 (73,095) 3,259,306 (73,095) 42,055 2,017,768 658,851 115,428 (73,095) 2,834,102 (73,095) 30,521,848 425,204 L Ending 0 —Balance 16,091 1,661,499 33,034,251 34711841 2,178,733 11 70,110,456 6,557,917 8,036,106n 86,883,212 U 1,589,961 a 43,537,339 4,082,257 a 6,726,603 55,936,160 30,94 $ 64,520,880 3,717,791 (2,579,778) 65,658,893 n Depreciation expense was charged to the departments and functions of the primary government as follows: Governmental activities: General government Public safety Education, culture, recreation Total – governmental activities Business -type activities: Municipal solid waste collection and disposal Hospital facilities Long term care center Kodiak fisheries research center Research court apartments Total – business -type activities Total primary government 57 $ 858,109 163,263 5,656,255 $ 6,677,627 $ 235,004 1,326,227 518,933 719,871 34,067 2,834,102 $ 9,511,729 L•' I �I I II r r (9) l 1 I I I L L L L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Interfund Receivables, Payables and Transfers (a) 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, 2023 were as follows: Transfers In Facilities Special Other Transfers Out General Revenue Governmental Fund Fund Funds Total Major Governmental Funds: Education Debt Service $ 5,879,272 2,213,366 4,047,302 12,139,940 Other Governmental Funds - - 305,041 305,041 Total transfers $ 5,879,272 2,213,366 4,352,343 12,444,981 A summary of significant transfers are as follows: • The Education Debt Service Fund transferred money to the following funds as a reimbursement for prior years debt service contributions: o $5,879,272 to the General Fund o $2,213,366 to the Facilities Special Revenue Fund o $4,047,302 to the Renewal and Replacement Projects Capital Project Fund • The Buildings and Grounds Special Revenue Fund transferred $55,000 to the Renewal and Replacement Projects Capital Project Fund to fund the pool evaluation, school ceiling repairs, and school skylight repairs. • The Other Capital Projects Capital Project Fund transferred $105,041 to the Renewal and Replacement Projects Capital Project Fund to return unexpended funds. • The Fire Protection Area #1 Special Revenue Fund transferred $100,000 to the Other Capital Projects Capital Project Fund to fund classroom additions. • The Buildings and Grounds Special Revenue Fund transferred $45,000 to the Borough Capital Projects Fund to fund a school roof project. The remainder of this page left blank intentionally. 58 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (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, 2022 Additions Reductions June 30, 2023 One Year Governmental activities: $21,595,000 2013 Series One High School Renovation Bonds, due in Semi-annual installments of $895,000 to $1,630,000 plus interest of 3.80% to 5.0% through February 2033. This bond was refunded by issuing the 2021 Series Three Bonds 1,010,000 - 1.010,000 $22,660,000 2014 Series One High School Renovation Bonds, due in semi-annual installments of $900,000 to $1,690,000 plus interest of 3.12% to 5.0% through March 2034. This bond was refunded by issuing the 2021 Series Four Bonds 3,180,000 - 1,010,000 The remainder of this page left blank intentionally. rM 2,170,000 1,060,000 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Balance July 1, 2022 Additions Due Balance Within Reductions June 30, 2023 One Year Governmental activities, continued: $6,210,000 2015 Series Three High School Renovation Bonds, due in semi-annual installments of $215,000 to $480,000 plus interest of 4.0% to 5.25% through October 2035 4,930,000 - 250,000 $1,780,000 2015 Series Three Renewal and Replacement Bonds, due in semi-annual installments of $160,000 to $220,000 plus interest of 5.0% through October 2025 820,000 - 190,000 $1,870,000 2016 Series One A High School Renovation Bonds, due in semi-annual installments of $70,000 to $130,000 plus interest of 2.0"/o to 5.0% through August 2035 1,485,000 - 80,000 $5,140,000 2016 Series One B Renewal and Replacement Bonds, due in semi-annual installments of $490,000 to $660,000 plus interest of 5.0% through August 2025 2,455,000 - 570,000 $4,905,000 2016 Series Three High School Renovation Bonds, due in annual installments of $415,000 to $605,000 plus interest of 4.0% to 5.0% through December 2027 3,215,000 - 470,000 $550,000 2018 Series A Bonds, due in annual installments of $50,000 to $60,000 plus interest of 2.67% to 3.05% through December 2028 400,000 - 55,000 4,680,000 265,000 630,000 200,000 1,405,000 85,000 1,885,000 595,000 2,745,000 495,000 345,000 55,000 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Balance Balance Due Within July 1, 2022 Additions Reductions June 30, 2023 One Year Governmental activities, continued: $345,000 2020 Series A High School Renovation Bond, due in annual installments of $25,000 to $45,000 plus interest of 5.0% through December 2030 320,000 $1,855,000 2020 Series B Bonds due in annual installments of $145,000 to $230,000 plus interest of 5% through December 2030 1,710,000 $4,070,000 2021 Series 1 Bonds issued to partially refund the 2011 Series One Bonds due in annual installments of $330,000 to $505,000 plus interest of 5% through December 2030 3,740,000 $4,225,000 2021 Series 2 Bonds issued to partially refund the 2012 Series A and B Bonds due in annual installments of $125,000 to $1,375,000 plus interest of .243% to .698% through December 2024 4,100,000 $14,535,000 2021 Series 3 Bonds issued to partially refund the 2013 Series One Bonds due in annual installments of $275,000 to $1,515,000 plus interest of .243% to 2.22% through December 2032 14,260,000 - $14,520,000 2021 Series 4 Bonds issued to partially refund the 2014 Series One Bonds due in annual installments of $255,000 to $1,625,000 plus interest of .243% to 2.352% through December 2033 30,000 290,000 30,000 155,000 1,555,000 160,000 340,000 1,360,000 270,000 3,400,000 355,000 2,740,000 1,365,000 13,990,000 1,325,000 14,265,000 - 245.000 14,020,000 250,000 $ 55,890,000 - 6.035,000 49,855,000 6,240,000 61 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued I L L C As of June 30, 2023, the Borough had the following bond payable outstanding in the Long Term Care Center Enterprise Fund: On May 26, 2021, the Borough refunded a portion of the 20113 Series revenue bond by issuing a $8,100,000 revenue bond. The bond was marketed by the Alaska Municipal Bond Bank. Interest accrues at rates between of .243% and 2.222% with payments due on June 1 and December 1 of each year. The current portion as of June 30, 2023, is $125,000. The bond will mature on December 1, 2032. L62 $ 7,845,000 (b) Notes and Bonds Payable As of June 30, 2023, 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, 2022, 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. $ 800,000 Note payable (ACWF #505041) to Alaska Department of Environmental r Conservation (ADEC), to be paid within 20 years. Interest accrues at I1.5% 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. $ 8,929,838 Note payable (ACWF #505061) to Alaska Department of Environmental ( Conservation (ADEC), to be paid within 20 years. Interest accrues at t 1.5% over the life of the loan. The first loan payment was made on March I, 2016, with principal payments of $131,227 being due on March 1 in each successive year. $ 1,574,717 On May 26, 2021, the Borough refunded the 2011 Series Three revenue bond by issuing a $1,215,000 revenue bond, with a premium of $190,994. The bond was marketed by the Alaska Municipal Bond Bank. Interest accrues at rate of 5.0% over the life of the loan. The first loan payment was made on December 1, 2022, with principal l payments due on December 1 in each successive year. The bond will mature on December 1, 2027. $ 995,000 I L L C As of June 30, 2023, the Borough had the following bond payable outstanding in the Long Term Care Center Enterprise Fund: On May 26, 2021, the Borough refunded a portion of the 20113 Series revenue bond by issuing a $8,100,000 revenue bond. The bond was marketed by the Alaska Municipal Bond Bank. Interest accrues at rates between of .243% and 2.222% with payments due on June 1 and December 1 of each year. The current portion as of June 30, 2023, is $125,000. The bond will mature on December 1, 2032. L62 $ 7,845,000 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (c) Changes in Long-term Liabilities Long-term liability activity for the year ended June 30, 2023, was as follows: Balance Balance June 30, June 30, Due within 2022 Additions Reductions 2023 one year Governmental activities: Bonds payable: General obligation bonds Bond premium Compensated absences Total Business -type activities: M unicipal Solid waste Collection and Disposal: Landfill closure and post -closure costs Compensated absences Notes and bonds payable Bond premium Total Long Term Care Center: Bonds payable Bond premium Total $ 55,890,000 — 6,035,000 49,855,000 6,240,000 2,685,062 — 573.955 2,111,107 402,714 58,575,062 — 6,608.955 51,966,107 6,642,714 152,113 183.079 125,883 209,309 61,036 $ 58.727.175 183.079 6.734.838 52.175.416 6,703,750 $ 7,189,000 — 496,000 6,693,000 — 118,739 64,933 67,829 115,843 25,692 13,388,628 1,089,073 12,299,555 1,099,073 159,162 — 31.832 127,330 31,832 $ 20.855.529 64.933 1.684.734 19235.728 1,156,597 Landfill closure and post - 8,560,000 715,000 7,845,000 740,000 57.810 57.810 — Compensated absences $ 8.617.810 772.810 7.845.000 740.000 Kodiak Fisheries Research Center: Compensated absences $ 33,397 11.293 38,229 6.461 2,604 Business -type activities: Landfill closure and post - closure costs $ 7,189,000 — 496,000 6,693,000 — Compensated absences 152,136 76,226 106,058 122,304 28,296 Notes and bonds payable 21,948,628 — 1.804,073 20,144,555 1,839,073 Bond premium 216.972 89.642 127,330 31,832 Total $ 29.506.736 76.226 2.495.773 27,087,189 1,899,201 For governmental activities, compensated absences are generally liquidated by the General Fund. 63 A I [1 I L I L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Annual debt service requirements to maturity for all the Governmental Activities general obligation bonds outstanding as of June 30, 2023, are as follows: Year ending June 30: 2024 2025 2026 2027 2028 2029-2033 2034-2036 Principal $ 6,240,000 6,420,000 5,230,000 4,450,000 4,565,000 19,585,000 3,365,000 $ 49,855,000 Interest 1,322,359 1,138,810 959,871 828,058 707,672 1,860,099 147,453 6,964,322 Total 7,562,359 7,558,810 6,189,871 5,278,058 5,272,672 21,445,099 3,512,453 56,819,322 At June 30, 2023, there was $687,206 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. Annual debt service requirements to maturity for all of the Business -type Activities revenue bonds and notes payable obligations outstanding as of June 30, 2023, are as follows: Year ending June 30: 2024 2025 2026 2027 2028 2029-2033 2034-2037 Principal $ 970,000 990,000 1,005,000 1,030,000 770,000 4,075,000 Bonds Payable Interest Total 157,374 1,127,374 139,136 1,129,136 118,400 1,123,400 94,889 1,124,889 75,450 845,450 218,145 4,293,145 $ 8,840,000 803,394 9,643,394 Principal 869,073 869,073 869,073 869,073 869,073 4,145,359 2,813,831 11,304,555 (The remainder of this page intentionally left blank.) 1� 64 Notes Paya Interest 169,569 156,533 143,496 130,461 117,424 393,077 101,582 1,212,142 Total 1,038,642 1,025,606 1,012,569 999,534 986,497 4,538,436 2,915,413 12,516,697 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (11) Fund Balances Detailed information related to amounts classified as nonspendable, committed and assigned fund balances in governmental funds at June 30, 2023 are as follows: Education 2,978,127 22,824 State Capital 1,342,134 Support Facilities Education Grants 45,928,606 Special Special Debt Capital Other General Revenue Revenue Service Project Governmental Fund Fund Fund Fund Fund Funds Total Nonspendable: Prepaid items $ 120,671 1,745 122,416 Restricted: Commercial Passenger Vessel $ Committed: Facility Upgrades - - 39,911,999 - Debt Service - - - 687,206 Fire and Road Service Areas - - - - Emergency planning - - - Land Sales - - - - Buildings and Grounds - - - Street Lighting Districts - - - - Tourism Development - - - - Mission Lake Tide Gate - - - - Opioid Class Action Settlement - - - Total committed39,911,999 687,206 Assigned 54,247 54,247 39,911,999 687,206 2,978,127 2,978,127 22,824 22,824 1,342,134 1,342,134 716,692 716,692 50,975 50,975 115,885 115,885 60,113 60,113 42,651 42,651 5,329,401 45,928,606 Capital Projects and a Upgrades $ 445,666 12,520,702 12,966,368 (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 Q 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 $6,693,000 as of June 30, 2023, Q which is based on 43.3% usage (filled) of the landfill. The Borough recorded closure/post-closure expenses/(reduction) of ($377,580) of estimated future costs for closure and post -closure costs. The estimated total current cost of the landfill closure and post closure care of $6,693,000 is based on the amount that would be paid if the landfill were closed as of June 30, 2023. 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. 65 a ! KODIAK ISLAND BOROUGH rNotes to Basic Financial Statements, Continued 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 2026. The lateral expansion has an estimated forty year capacity. Capital costs to complete are estimated at $4,250,000. (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 t and there is also a separate pool for policy liability. The responsibilities of both JIA and the participants are as follows: (a) Responsibilities of JL4 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. L • 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. L 66 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (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) Leases (a) Hospital Facilities Enterprise Fund The Kodiak Island Borough 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 Borough received $1,170,808 in lease payments for the year ended June 30, 2023. The lease receivable at June 30, 2023 was $5,009,098. The Borough has deferred inflows of resources associated with the lease that will be recognized as revenue over the lease term. At June 30, 2023 the deferred inflow of resources was $4,683,232. 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. The future principal and interest lease payments to be received as of June 30, 2023, were as follows: 67 J V I f M L LJ !1 11 I T I I I It Principal Interest Total 2024 $ 1,160,165 224,107 1,384,272 2025 1,219,521 164,751 1,384,272 2026 1,281,914 102,358 1,384,272 2027 1,347,498 36,773 1,384,271 Total $ 5,009,098 527,989 5,537,087 67 J V I f M L LJ !1 11 I T I I I It rKODIAK ISLAND BOROUGH rNotes to Basic Financial Statements, Continued (h) Long Term Care Center Enterprise 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 Enterprise Fund. The agreement with Providence specifies that Providence will pay monthly lease payments to the Borough in an amount no less than required to fully fund all debt service requirements plus an amount sufficient to cover the Borough's expenses in maintaining insurance for fire and other risks (including earthquakes). IThe 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 June 30, 2033, is $86,969. The Borough received $765,187 in lease payments for the year ended June 30, 2023. The lease receivable at June 30, 2023 was $8,356,656. The Borough has deferred inflows of resources associated with the lease that will be recognized as revenue over the lease term. At June 30, 2023 the deferred inflow of resources was $7,843,171. The future principal and interest lease payments to be received as of June 30, 2023, were as follows: Principal Interest Total 2024 $ 640,337 403,291 1,043,628 2025 673,098 370,530 1,043,628 t 2026 707,535 336,093 1,043,628 2027 743,734 299,894 1,043,628 2028 781,785 261,843 1,043,628 2029-2033 4,551,419 666,721 5,218,140 2034 258,748 2,159 260,907 Total $ 8,356,656 2,340,531 10,697,187 L(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 Commission (NRC), and Kodiak Regional Aquaculture Association (KRAA). LThe lease with ADF&G is from October 1, 1998 through September 30, 2018. In September 2018, one of two options to extend for an additional five-year period was executed, extending the term of the lease through September 2023. Annual rent escalates each year and is currently $61,628. L 68 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued a 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 and ends on March 2029. The original bond issue was fully paid by the Borough; n 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 $740,107 as of June 30, 2023. 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 $26,311 is effective through February 29, 2024. The lease with Kodiak Regional Aquaculture Association was amended to include more space. The new lease term is from March 2020 through June 30, 2023. Annual rent is $18,924. The Borough received $566,318 in lease payments for the year ended June 30, 2023. The lease receivable at June 30, 2023 was $6,315,421. The Borough has deferred inflows of resources associated with the leases that will be recognized as revenue over the lease terms. At June 30, 2023 the deferred inflow of resources was $5,823,371. The future principal and interest lease payments to be received as of June 30, 2023, were as follows: Principal Interest Total o 2024 $ 330,095 308,455 638,550 2025 376,450 290,717 667,167 2026 395,710 271,457 667,167 2027 416,686 251,207 667,893 2028 439,503 229,843 669,346 2029-2033 2,568,048 787,342 3,355,390 2034-2038 1,788,929 137,491 1,926,419 Total $ 6,315,421 2,276,512 8,591,933 (15) Employee Retirement System Plans The Borough follows Governmental Accounting Standards Board (GASB) Codification P20, a 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 a State of Alaska Public Employees' Retirement System (PERS). In addition to the pension plan, PERS also administers other post -employment benefit (OPEB) plans. 69 a rKODIAK ISLAND BOROUGH rNotes to Basic Financial Statements, Continued 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. PERS acts as the common investment and administrative agencies for the following multiple -employer plans: r- Plan Name Type of Plan IDefined Benefit Pension Plan (DB) Cost-sharing, Defined Benefit Pension Defined Contribution Pension Plan (DC) Defined Contribution Pension rDefined Benefit Other Postemployment Benefits (OPEB): 1 Occupational Death and Disability Plan Cost-sharing, Defined Benefit OPEB Alaska Retiree Healthcare Trust Plan Cost-sharing, Defined Benefit OPEB r Retiree Medical Plan Cost-sharing, Defined Benefit OPEB lDefined Contribution Other Postemployment Benefits (DC): Healthcare Reimbursement Arrangement Plan 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. For the year ended June 30, 2022 the employer contribution rate is 0.31%. Alaska Retiree Healthcare Trust Plan (ARHCT) Beginning July 1, 2007, the Alaska Retiree Healthcare Trust Plan (ARHCT), a Healthcare Trust Fund of I 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). For the year ended June 30, 2022 (latest available information) employer contributions were 6.46% of annual payroll. 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. For the year ended June 30, 2022 employer contributions were 1.07%. 0 L 70 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued 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. Employer contributions are 3% of the average annual compensation of all employees in the plan. Investments The Board is the investment oversight authority of the system's investments. As the fiduciary, the Board has the statutory authority 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. State of Alaska Department of 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, 2022 (latest available report) for the DB Plans for PERS are: DB Pension 6.00%, ARHCT 6.03%, ODD 6.30%, and RMP is 6.28%. 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 goy/armb/Reports-and-Policies/Annual-Audited-Financial-Scliedules.asi2x. 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 for the PERS plan (rates shown below exclude an annual inflation component of 2.88%): Asset Class Broad Domestic Equity Global Equity (non -U.S.) Aggregate Bonds Real Assets Private Equity Cash Equivalents 71 Long -Term Expected Real Rate of Return 6.51% 5.70% 0.31% 3.71% 9.61% (0.50)% LTJ fi r r I I M LTJ LTJ Ii1 I1I F I L M M 11 J t t KODIAK ISLAND BOROUGH rNotes to Basic Financial Statements, Continued Discount Rate: The discount rate used to measure the total pension and OPEB liabilities and assets is 7.25%, which represents a decrease of 0.13% since the prior measurement period. The projection of the cash flows used to determine the discount rate assumes that Employer and State contributions will continue to follow the current funding policy, which meets State statutes. Based on those assumptions, the net pension and OPEB plans fiduciary net pension and OPEB liabilities and assets 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 and assets. In the event benefit payments are not covered by the plan's fiduciary net position, a municipal bond rate would be used to discount the benefits not covered by the plan's fiduciary net position. The S&P Municipal Bond 20 -Year High Grade Index rate was 4.09% as of June 30, 2022 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% of eligible wages, subject to the salary floor, and other termination costs as described below. This 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. 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. On -behalf contribution amounts have been recognized in these financial i 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 a 7.25% discount rate. L L L 72 KODIAK ISLAND BOROUGH 0 Notes to Basic Financial Statements, Continued Employer Contribution rates for the plan year ended 2022 (measurement period) are as follows: ARM Employer Board State Effective Adopted Contribution Rate Rate Rate (, PERS: u Pension 22.00% 24.79% 2.79% OPEB 0.00% 0.00% 0.00% Total PERS contribution rates 22.00% 24.79% 2.79% 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 uuu 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 plan year ended 2022 (measurement period) the past service rate for PERS is 16.01%. Actuarial Assumptions: The total pension and OPEB liabilities on June 30, 2022 (latest available) were 0 determined by an actuarial valuation as of June 30, 2021 which was rolled forward to the measurement date June 30, 2022. These actuarial assumptions were based on the results of an actuarial experience study for the period from July 1, 2013 to June 30, 2017. Inflation 2.50% per year. n Salary Increases Increases range from 2.85% to 8.5% based on service. ' Investment return / discount rate 7.25%, net of expenses based on average inflation of 2.50% and a real return of 4.75%. Mortality Based upon 2017 - 2021 actual experience study and applicable tables contained in Pub -210, projected with I[J1 MP -2021 generational improvement. Healthcare cost trend rates Pre -65 medical: 7.0% grading down to 4.5% Post -65 medical: 5.5% grading down to 4.5% Rx/EGWP: 7.5% grading down to 4.5%. 0 Ultimate trend rates reached in FY2050. 0 I 73 0 r r C I L L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued The actuarial assumptions used in the June 30, 2021 actuarial valuation are the same as those used in the June 30, 2020 valuation with the following exceptions related to the ARHCT plan: 1. Per capita claims costs were updated to reflect recent experience. 2. Normal cost for administrative expenses were updated to reflect recent two years of actual administrative expenses paid from plan assets. The changes of assumptions from the latest experience study significantly reduced deferred inflows of resources attributable to the Borough, as well as a net OPEB benefit recognized by the Borough for the State's proportionate share of OPEB plan expense attributable to the Borough. In some instances the reduction of revenues and expenses reported for the State's proportionate share of OPEB plan expense attributable to the Borough creates a net negative Pension/OPEB expense (net pension/OPEB benefit) which results in negative operating grants and contributions for certain functions reported on the Statement of Activities. 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: littp:Hdoa.alaska.gov/drb/pei-s. 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 plan 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 150 employers participating in PERS defined benefit plan and 151 participating in PERS defined contribution and OPEB plans. 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 peace officers/firefighters 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. 74 KODIAK ISLAND BOROUGH a Notes to Basic Financial Statements, Continued The percentage multipliers for peace officers/firefighters are 2% for the first ten years of service and 2.5% for all service over 10 years. The percentage multipliers for all other participants are 2% for the ^ first ten years, 2.25% for the next ten years, and 2.5% for all remaining service earned on or after July 1, 1986. All service before that date is calculated at 2%. Post -employment healthcare benefits are provided without cost to all members first enrolled before July 1, 1986. Members first enrolled after June 30, 1986, but before July 1, 2006, and who have not reached age 60 may elect to pay for major medical benefits. Post Retirement Pension Adjustments. The plan has two types of postretirement pension adjustments (PRPA). The automatic PRPA is issued annually to all eligible benefit recipients, when the cost of living increases in the previous calendar year. The discretionary PRPA may be granted to eligible recipients by the DB Plan's administrator if the funding ratio of the DB Plan meets or exceeds 105%. If both an automatic and discretionary PRPA are granted, the retiree is eligible for both adjustments, n the one that provides the retiree with the greatest benefit will be paid. a 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 25's 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. Employee Contribution Rate. PERS active members are required to contribute 6.75%, 7.5% for peace officers and firefighters, and 9.6% for certain school district employees. Employer contributions for the year ended June 30, 2023, were: Pensions Other Post -Employment (DB) Benefits (DB) Total $ 454,215 27,980 482,195 Public Employees Retirement Plans For the year ended June 30, 2023 the State of Alaska contributed $79,446 (100% pension cost) on- a behalf of the Borough, which has been recorded in the fund financial statements under the modified - accrual basis of accounting. In the government -wide financial statements the on -behalf contribution a has been adjusted as of the measurement date June 30, 2022 to a total of ($87,869), to represent the pension/OPEB expense attributable to the State under the full accrual basis of accounting. LJ 75 a I I L L I KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Pension and OPEB Liabilities and Assets, Pension and OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions and OPEB: At June 30, 2023, the Borough reported liabilities and assets 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 (assets), the related State support, and the total portion of the net pension and OPEB liabilities (assets) that were associated with the Borough were as follows: Defined Benefit: Borough's proportionate share of the net pension liability State's proportionate share of the net pension liability Total Borough's proportionate share of the ARHCT OPEB liability (asset) State's proportionate share of the ARHCT OPEB liability (asset) Total Borough's proportionate share of the ODD OPEB liability (asset) Borough's proportionate share of the RMP OPEB liability (asset) Total Borough's share of net pension and OPEB liabilities and assets Pension $ 4,566,746 1,261,745 $ 5,828,491 OPEB $ (1,748,589) (501,316) $ (2,249,905 $ (47,016) $ (42,879) $ 2,728,262 The net pension and OPEB liabilities and assets were determined by an actuarial valuation as of June 30, 2021, rolled forward to the measurement date of June 30, 2022 and adjusted to reflect updated assumptions. The Borough's proportion of the net pension and OPEB liabilities and assets were based on the present value of contributions for FY2023 through FY2039, as determined by projections based on the June 30, 2021 valuation. The Borough's proportionate share and changes in the pension and OPEB liabilities and assets were as follows: June 30, 2022 June 30, 2021 Measurement Measurement Pension 0.0896% OPEB: ARHCT 0.0889% ODD 0.1073% RMP 0.1235% L 76 0.1158% 0.1163% 0.1243% 0.1404% Change (0.0262%) (0.0274%) (0.0170%) (0.0169%) KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Based on the measurement date of June 30, 2022, the Borough recognized pension and OPEB expense (benefit) of ($805,597) and ($518,885), respectively, for the year ended June 30, 2023. At June 30, 2023, the Borough reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Defined Benefit: Differences between expected and actual experience Changes of assumptions Net difference between projected and actual earnings on pension plan investments Changes in proportion and differences between Borough contributions and proportionate share of contributions Borough contributions subsequent to the measurement date Total Differences between expected and actual experience Changes of assumptions Net difference between projected and actual earnings on OPEB plan investments Changes in proportion and differences between Borough contributions and proportionate share of contributions Borough contributions subsequent to the measurement date Total 77 Pension Deferred Outflows Deferred Inflows of Resources of Resources 130,565 454,215 $ 584,780 OPEB ARHCT Deferred Outflows Deferred Inflows of Resources of Resources $ (12,377) (80,245) 99,204 78,976 $ 178,180 (92,622) A I I I L I L KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued Differences between expected and actual experience Changes of assumptions Net difference between projected and actual earnings on OPEB plan investments Changes in proportion and differences between Borough contributions and proportionate share of contributions Borough contributions subsequent to the measurement date Total Differences between expected and actual experience Changes of assumptions Net difference between projected and actual earnings on OPEB plan investments Changes in proportion and differences between Borough contributions and proportionate share of contributions Borough contributions subsequent to the measurement date Total Deferred Outflows Deferred Inflows of Resources of Resources $ (15,424) (299) 1,593 6,928 (2,158) 6,229 $ 14,750 (17,881) OPEB RMP Deferred Outflows Deferred Inflows of Resources of Resources $ 2,126 (1,685) 8,302 (51,413) 6,116 1,216 (2,376) 21,751 $ 39,511 (55,474) $545,215 and $27,980 are reported as deferred outflows of resources related to pension and OPEB resulting from Borough contributions subsequent to the measurement date and will be recognized as a reduction of the net pension and OPEB liabilities and as an increase to the net pension and OPEB assets in the year ended June 30, 2024, 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: Plan Year Ended June 30, 2023 2024 2025 2026 2027 Thereafter Total L78 OPEB OPEB OPEB Pension ARHCT ODD RMP $ (15,521) (30,306) (2,225) (6,283) (39,787) (34,791) (2,304) (6,583) (95,513) (78,375) (2,557) (7,527) 281,386 229,030 (159) 612 - - (1,062) (8,082) - - (1,053) (9,851) $ 130,565 85,558 (9,360) (37,714) L78 KODIAK ISLAND BOROUGH o Notes to Basic Financial Statements, Continued For the year ended June 30, 2023, the Borough recognized ($1,186,346) and $236,116 of pension and OPEB amortization of the net deferred outflows and inflows of resources, respectively. Sensitivity of the Net Pension and OPEB Liabilities and Assets to Changes in the Discount Rate: The following presents the net pension and OPEB liabilities and assets of the plan calculated using the n discount rate of 7.25%, as well as what the Plans' net pension and OPEB liabilities and assets would IUI be if they were calculated using a discount rate that is 1 -percentage -point lower (6.25%) or (- percentage -point higher (8.25%) than the current rate: 1% Decrease Current Rate 1% Increase (6.25%) (7.25%) (8.25%) Net pension liability $ 6,147,821 4,566,746 3,233,573 Net OPEB ARHCT (asset) $ (1,038,914) (1,748,589) (2,343,715) Net OPEB ODD (asset) $ (44,288) (47,016) (49,149) n IUI Net OPEB RMP liability (asset) $ 7,887 (42,879) (81,591) Sensitivity of the Borough's proportionate share of the Net OPEB liability and assets to changes in the (t healthcare cost trend rates. The following present the Borough's proportionate share of the net OPEB u liability (asset), as well as what the Borough's proportionate share of the net OPEB liability (asset) would be if it were calculated using healthcare cost trend rates that are 1 -percentage -point lower or (- percentage -point higher than the current healthcare cost trend rates: 1% Decrease Current Rate 1% Increase a Net OPEB ARHCT (asset) $ (2,413,724) (1,748,589) (954,289) Net OPEB RMP liability (asset) $ (86,908) (42,879) 16,425 n Alaska Public Employee Retirement System (PERS) — Defined Contribution Plan (DC) (J Plan Description and Funding Requirements. Cities and Public Employers in the State of Alaska have a defined contribution retirement plan (PERS Tier IV) for new hires first enrolled on or after July 1, 2006. This Plan is administered by the State of Alaska, Department of Administration in conjunction with the defined benefit plan noted above. The Administrator of the Plan is the Commissioner of Administration or the Commissioner's designee. Plan members make mandatory contributions of 8% of gross eligible compensation. This amount goes directly to the individual's account. State statutes require the employer to contribute 5% of employees' eligible compensation. Additionally, employers a are required to contribute to OPEB (DB): 1.07% for the retiree medical plan (DB), 0.31% and 0.68% (peace officers) 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 capped at 22% with anything in excess of the previously listed rates being contributed to the Defined Benefit Unfunded Liability (DBUL). R Plan members are 100% vested with their contributions. (�]} a I 79 a rKODIAK ISLAND BOROUGH rNotes to Basic Financial Statements, Continued Members become vested in employers' contributions as follows: r 2 years of service — 25% 3 years of service — 50% 4 years of service — 75% r5 years of service — 100% 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, 2023, were $98,877. The first plan is managed by Mission Square, formally International City Managers Association Retirement Corporation (ICMA). $23,650 was contributed to this plan during the year ended June 30, 2023. The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. r The second plan is managed by Empower, formally MassMutual Financial Group. $6,500 was contributed to this plan during the year ended June 30, 2023 The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. The third plan is managed by Empower and accepts both taxable and non-taxable contributions. $68,727 was contributed to this plan during the year ended June 30, 2023 The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. (16) Contingencies L (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 has determined that it is reasonably possible that the Borough will be subject to a potential liability ranging from $0 to $750,000 related to the refund of taxes paid under protest for tax year 2020 along with associated attorney fees and costs. L (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. L 80 The Borough contributed $158,720 for the year ended June 30, 2023, which included forfeitures of $6,285 which have been applied as employer contributions. rDeferred Compensation Plan The Kodiak Island Borough has three 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, 2023, were $98,877. The first plan is managed by Mission Square, formally International City Managers Association Retirement Corporation (ICMA). $23,650 was contributed to this plan during the year ended June 30, 2023. The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. r The second plan is managed by Empower, formally MassMutual Financial Group. $6,500 was contributed to this plan during the year ended June 30, 2023 The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. The third plan is managed by Empower and accepts both taxable and non-taxable contributions. $68,727 was contributed to this plan during the year ended June 30, 2023 The Borough believes that the plan does not meet the criteria for inclusion as a fiduciary fund. (16) Contingencies L (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 has determined that it is reasonably possible that the Borough will be subject to a potential liability ranging from $0 to $750,000 related to the refund of taxes paid under protest for tax year 2020 along with associated attorney fees and costs. L (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. L 80 KODIAK ISLAND BOROUGH Notes to Basic Financial Statements, Continued (17) Advance Refunding of Debt In May 2021, the Borough issued $14,520,000 of 2021 Series Four general obligation bonds with interest rates ranging from 0.243% to 2.352% to advance refund $12,645,000 of outstanding 2014 Series One general obligation bonds with interest rates ranging from 3.80% to 5.00%. The net proceeds of $14,437,316 (after a payment of $82,684 of issuance costs) were used to purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 2014 Series One bonds. As a result, the 2014 Series One bonds are considered to be defeased and the liability for those bonds has been removed from the financial statements. As of June 30, 2023, the amount of defeased debt still outstanding was $12,645,000. (18) Subsequent Events Management have evaluated subsequent events through December 22, 2023, the date which the financial statements were available for issue. (19) Construction Commitments a The Borough has outstanding commitments for construction at year end of $2,362,917. (20) Subsequent Accounting Pronouncements The Governmental Accounting Standards Board has passed several new accounting standards with upcoming n implementation dates covering several topics as follows: 11 • GASB 100 Accounting Changes and Error Corrections—an amendment of GASB Statement No. 62. Effective for fiscal years beginning after June 15, 2023. Multiple effective dates. • GASB 101 Compensated Absences. Effective for fiscal years beginning after December 15, 2023. GASB Statement No. 100 will improve the clarity of the accounting and financial reporting requirements for accounting changes and error corrections, which will result in greater consistency in application in practice. In turn, more understandable, reliable, relevant, consistent, and comparable information will be provided to financial statement users for making decisions or assessing accountability. In addition, the display and note disclosure requirements will result in more consistent, decision useful, understandable, and comprehensive Q information for users about accounting changes and error corrections. GASB Statement No. 101 unified recognition and measurement model in this Statement will result in a liability for compensated absences that more appropriately reflects when a government incurs an obligation. In addition, the model can be applied consistently to any type of compensated absence and will eliminate potential comparability issues between governments that offer different types of leave. The model also will result in a more robust estimate of the amount of compensated absences that a government will pay or settle, which will enhance the relevance and reliability of information about the liability for compensated absences. 81 0 REQUIRED SUPPLEMENTARY INFORMATION I I L j L L �Y L KODIAK ISLAND BOROUGH Budgetary Comparison Schedule General Fund Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Revenues: Property taxes and assessments: Real Personal Aircraft Penalty and interest Total property taxes and assessments Severance taxes: Fish Mining Logging Total severance taxes Excise taxes: Tobacco Marijuana Total excise taxes Intergovernmental: State sources: State community assistance Fisheries business tax Fisheries resource landing tax Electric cooperative tax PERS on -behalf payment Marijuana license Total state sources Federal sources: Payments in lieu of taxes Fish and Wildlife revenue sharing Total federal sources Total intergovernmental revenue Charges for services - Sale of copies and maps Licenses, permits and fees: Building and trailer permits Subdivision and zoning fees Business licenses Other permits Total licenses, permits and fees Investment income (loss) Other Total revenues 82 2023 Variance wn Final Budget - Bud eI Positive 2022 rigina�loal- Actual (Negative) Actual $ 1,598,833 1,598,833 1,604,686 5,853 2,799,824 183,589 183,589 188,509 4,920 322,420 26,900 26,900 25,700 (1,200) 22,700 210,000 210,000 232,873 22,873 303,630 2,019,322 2,019,322 2,051,768 32,446 3,448,574 1,100,000 1,100,000 1,554,470 454,470 1,641,429 5,000 5,000 1,479 (3,521) 2,893 20,000 20,000 41,378 21,378 33,273 1,125,000 1,125,000 1,597,327 472,327 1,677,595 525,000 525,000 829,274 304,274 683,019 1,000 1,000 - (1,000) 952 526,000 526,000 829,274 303,274 683,971 292,288 292,288 477,242 184,954 343,543 1,000,000 1,000,000 1,347,362 347,362 854,209 100,000 100,000 59,341 (40,659) 95,843 16,000 16,000 20,778 4,778 20,441 64,305 64,305 51,677 (12,628) 160,242 3,000 3,000 600 1,472,593 1,472,593 1,959A00 486,807 1,474,878 1,438,000 1,438,000 1,783,197 345,197 1,672,213 180,000 180,000 201,160 21,160 180,874 1,618,000 1,618,000 1,984,357 366,357 1,853,087 3,090,593 3,090,593 3,943,757 853,164 3,327,965 527 527 775 67,730 67,730 57,238 (10,492) 46,066 14,400 14,400 12,900 (1,500) 11,435 1,300 1,300 400 (900) 200 10,100 10,100 5,626 (4,474) 5,274 93,530 93,530 76,164 (17,366) 62,975 50,000 50,000 422,783 372,783 (371,295) 700 700 10,666 9,966 841 6,905,145 6,905,145 8,932,266 2,027,121 8,831,401 (continued) 82 KODIAK ISLAND BOROUGH Budgetary Comparison Schedule General Fund, continued Year ended June 30, 2023 (With financial information for the year ended lune 30, 2022) Emergency preparedness Health and social welfare Education, culture and recreation Parks and recreation Kodiak College and city libraries Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Transfers in Transfers out Net other financing sources (uses) Change in fund balance Fund balance, at beginning of year Fund balance, at end of the year 33,700 33,700 2023 17,240 10,983 170,000 170,000 150,000 20,000 169,647 Variance with 20,045 20,562 (517) 20,396 43,037 Final Budget - 12,760 30,277 Bud et 136,588 Positive 2022 63,412 Original Final Actual (Negative) Actual Expenditures: (5,760,937) 3,420,739 9,181,676 3,366,795 General government: General administration $ 788,388 - 6,606,642 423,203 6,183,439 190,618 Borough assembly 192,287 192,287 168,806 23,481 129,231 Borough manager 598,285 598,285 285,809 312,476 558,883 Borough clerk 638,150 638,150 596,963 41,187 519,616 Borough attorney 110,500 110,500 43,907 66,593 81,136 Finance department 849,359 849,359 861,010 (11,651) 791,816 Management information systems 905,518 905,518 849,370 56,148 788,745 Assessing department 767,817 767,817 767,481 336 856,043 Engineering/facilities department 444,082 444,082 385,431 58,651 406,320 Total general government 5,294,386 11,112,640 4,381,980 6,730,660 4,322,408 Public safety - animal control 126,000 150,430 150,430 - 121,000 Community and economic development: Community development department 806,051 806,051 473,750 332,301 556,073 Building official 172,991 172,991 215,020 (42,029) 177,962 Economic development 20,600 20,600 10,600 10,000 600 Total community and economic development 999,642 999,642 699,370 300,272 734,635 Emergency preparedness Health and social welfare Education, culture and recreation Parks and recreation Kodiak College and city libraries Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Transfers in Transfers out Net other financing sources (uses) Change in fund balance Fund balance, at beginning of year Fund balance, at end of the year 33,700 33,700 16,460 17,240 10,983 170,000 170,000 150,000 20,000 169,647 20,045 20,045 20,562 (517) 20,396 43,037 43,037 12,760 30,277 22,125 100,000 136,588 79,965 56,623 63,412 6,786,810 12,666,082 5,511,527 7,154,555 5,464,606 118,335 (5,760,937) 3,420,739 9,181,676 3,366,795 5,879,272 5,879,272 (118,335) (118,335) 118,335 (2,603,196) (118,335) 5,760,937 5,879,272 118,335 (2,603,196) See accompanying notes to required supplementary information. 9,300,011 9,300,011 763,599 8,250,819 7,487,220 $ 17,550,830 8,250,819 LI] f I II C J Q 'I L_J C LJ I 83 0 r KODIAK ISLAND BOROUGH Budgetary Comparison Schedule Special Revenue Fund — Education Support r - Year ended lune 30, 2023 r (With financial information for the year ended June 30, 2022) I I 1. L L L Revenues: Property taxes and assessments: Real Personal Total revenues Expenditures: Primary and secondary education Excess (deficiency) of revenues over expenditures Fund balance (deficit), at beginning of year Fund balance (deficit). at end of year 2023 Variance with Final Budget — Budget Positive 2022 Original Final Actual (Negative) Actual $ 10,759,720 10,759,720 10,667,787 (91,933) 9,176,894 1,195,524 1,195,524 1,259,033 63,509 1,068,041 11,955,244 11,955,244 11,926,820 (28,424) 10,244,935 11,955,244 11,955,244 11,955,294 (50) 10,458,099 $ (28,474) (28.474) (213,164) (157,433) 55,731 $ (185,907) (157,433) See accompanying notes to required supplementary information. L 84 KODIAK ISLAND BOROUGH Budgetary Comparison Schedule Special Revenue Fund – Facilities Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Revenues - Investment income (loss) Expenditures - Contingencies Excess (deficiency) of revenues over expenditures Other financing sources (uses): Transfers in - Education Debt Service Fund Transfers out: Building and Grounds Special Revenue Fund Education Debt Service Fund Net other financing sources (uses) Change in fund balance Fund balance, at beginning of year Fund balance, at end of year 2023 Variance with Final Budget – Budget Positive 2022 Original Final Actual (Negative) Actual $ 340,000 340,000 426,116 86,116 (2,108,392) 340,000 2,553,366 — (2,213,366) 2,553,366 426,116 2,639,482 (2,108,392) 2,213,366 2,213,366 2,213,366 2,213,366 — $ 2,639,482 2.639.482 37.272.517 39.911 M9 See accompanying notes to required supplementary information. 85 (5.000) (539,389) (544.389) (2,652,781) 39,925,298 37,272,517 r r^ r- = r r- r� r- r" ^ = -" "" �" � -1 --1 ^-I KODIAK ISLAND BOROUGH Schedule of Borough's Proportionate Share of the Net Pension Liability Public Employees' Retirement System (PERS) June 30, 2023 See accompanying notes to Required Supplementary Information. i Borough's Proportionate Share of the Plan Fiduciary Borough's Borough's State of Alaska Net Pension Net Position as Proportion Proportionate Proportionate Liability as a a Percentage of the Net Share of the Share of the Total Borough's Percentage of of the Total Pension Net Pension Net Pension Net Pension Covered Covered Pension Year Liability Liability Liability Liability Payroll Payroll Liability 2015 0.0813% $ 3,790,363 $ 3,187,850 $ 6,978,213 $ 2,929,492 129.39% 62.37% 2016 0.1143% $ 5,545,660 $ 1,488,931 $ 7,034,591 $ 3,204,521 173.06% 63.96% 2017 0.1330% $ 7,434,494 $ 939,394 $ 8,373,888 $ 3,129,406 237.57% 59.55% 2018 0.1100% $ 5,687,130 $ 2,118,453 $ 7,805,583 $ 3,055,486 186.13% 63.37% 2019 0.1188% $ 5,902,812 $ 1,709,426 $ 7,612,238 $ 3,597,759 164.07% 65.19% 2020 0.1122% $ 6,144,196 $ 2,435,789 $ 8,579,985 $ 3,249,981 189.05% 63.42% 2021 0.0880% $ 5,191,159 $ 2,144,483 $ 7,335,642 $ 3,076,150 168.76% 61.61% 2022 0.1158% $ 4,247,344 $ 573,256 $ 4,820,600 $ 3,066,295 138.52% 76.46% 2023 0.0896% $ 4,566,746 $ 1,261,745 $ 5,828,491 $ 2,867,555 159.26% 67.97% See accompanying notes to Required Supplementary Information. i KODIAK ISLAND BOROUGH Schedule of Borough's Proportionate Share of the Net OPEB Liability (Asset) Public Employees' Retirement System (PERS) June 30, 2023 See accompanying notes to Required Supplementary Information. 87 © o®© x 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Borough's Proportionate Plan Fiduciary Borough's Borough's State of Alaska Share of the Net Position as Proportion Proportionate Proportionate Net OPEB a Percentage of the Net Share of the Share of the Total Liability as a of the Total OPEB Net OPEB Net OPEB Net OPEB Borough's Percentage of OPEB Liability Liability Liability Liability Covered Covered Liability Year (Asset) (Asset) (Asset) (Asset) Payroll Payroll (Asset) Alaska Retiree Healthcare Trust Plan (ARHCT): 2018 0.1101% $ 929,853 $ 347,255 $ 1,277,108 $ 3,055,486 30.43% 89.68% 2019 0.1187% $ 1,218,333 $ 353,630 $ 1,571,963 $ 3,597,759 33.86% 88.12% 2020 0.1121% $ 166,384 $ 66,122 $ 232,506 $ 3,249,981 5.12% 98.13% 2021 0.0880% $ (398,510) $ (165,197) $ (563,707) $ 3,076,150 -12.95% 106.15% 2022 0.1163% $ (2,984,594) $ (390,455) $ (3,375,049) $ 3,066,295 -97.34% 135.54% 2023 0.08890/. $ (1,748,589) $ (501,316) $ (2,249,905) $ 2,867,555 -60.98% 128.51% Occupational Death and Disability (ODD): 2018 0.1438% $ (20,405) $ - $ (20,405) $ 3,055,486 -0.67% 212.97% 2019 0.1648% $ (32,004) $ - $ (32,004) $ 3,597,759 -0.890/6 270.62% 2020 0.1352% $ (32,784) $ - $ (32,784) $ 3,249,981 -1.01% 297.43% 2021 0.1276% $ (34,792) $ - $ (34,792) $ 3,076,150 -1.13% 283.80% 2022 0.1243% $ (54,780) $ - $ (54,780) $ 3,066,295 -1.79% 374.22% 2023 0.1073% $ (47,016) $ - $ (47,016) $ 2,867,555 -1.64% 348.80% Retiree Medical Plan (RMP): 2018 0.1438% $ 7,500 $ - $ 7,500 $ 616,628 1.22% 93.98% 2019 0.1648% $ 20,969 $ - $ 20,969 $ 669,059 3.13% 88.71% 2020 0.1530% $ 36,596 $ - $ 36,596 $ 665,832 5.50% 83.17% 2021 0.1443% $ 10,236 $ - $ 10,236 $ 683,409 1.50% 92.23% 2022 0.1404% $ (37,673) $ - $ (37,673) $ 729,168 -5.17% 115.10% 2023 0.1235% $ (42,879) $ - $ (42,879) $ 717,059 -5.98% 120.08% See accompanying notes to Required Supplementary Information. 87 © o®© x 0 0 0 0 0 0 0 0 0 0 0 0 0 0 r". roll, r" = r ri l,„"."" ,."_, „"""."" " --" —" """I �" "_""11 —"I '„"1 Year Contractually Required Contribution KODIAK ISLAND BOROUGH Schedule of Borough's Contributions (Pensions) Public Employees' Retirement System (PERS) June 30, 2023 Contributions Relative to the Contractually Required Contribution Contribution Deficiency (Excess) 2015 $ 370,432 $ (370,432) $ $ 2016 $ 377,365 $ (377,365) $ $ 2017 $ 406,215 $ (406,215) $ $ 2018 $ 483,892 $ (483,892) $ $ 2019 $ 397,978 $ (401,284) $ (3,306) $ 2020 $ 356,123 $ (352,817) $ 3,306 $ 2021 $ 407,818 $ (407,818) $ - $ 2022 $ 386,986 $ (386,986) $ - $ 2023 $ 454,479 $ (454,215) $ 264 $ See accompanying notes to Required Supplementary Information. Borough's Covered Payroll 3,204,521 3,129,406 3,055,486 3,597,759 3,249,981 3,076,150 3,066,295 2,867,555 2,913,250 Contributions as a Percentage of Covered Payroll 11.56% 12.06% 13.29% 13.45% 12.25% 11.58% 13.30% 13.50% 15.60% KODIAK ISLAND BOROUGH Schedule of Borough's Contributions (OPEB) Public Employees' Retirement System (PERS) June 30, 2023 89 0 0 0® o 0 o a 0 0 0 0 0 o a o 0 0 0 Contributions Relative to the Contributions Contractually Contractually Contribution Borough's as a Percentage Required Required Deficiency Covered of Covered Year Contribution Contribution (Excess) Payroll Payroll Alaska Retiree Healthcare Trust Plan (ARHCT): 2018 $ 137,930 $ (137,930) $ - $ 3,597,759 3.83% 2019 $ 143,757 $ (143,757) $ - $ 3,249,981 4.42% 2020 $ 142,245 $ (142,245) $ - $ 3,076,150 4.62% 2021 $ 73,672 $ (73,672) $ - $ 3,066,295 2.400% 2022 $ 59,046 $ (59,046) $ - $ 2,867,555 2.06% 2023 $ - $ - $ - $ 2,913,250 0.00% Occupational Death and Disability (ODD): 2018 $ 3,283 $ (3,283) $ - $ 3,597,759 0.09% 2019 $ 5,521 $ (5,521) $ - $ 3,249,981 0.17% 2020 $ 5,597 $ (5,597) $ - $ 3,076,150 0.18% 2021 $ 6,630 $ (6,630) $ - $ 3,066,295 0.22% 2022 $ 6.187 $ (6,187) $ - $ 2,867,555 0.22% 2023 $ 6,229 $ (6,229) $ - $ 2,913,250 0.21% Retiree Medical Plan (RMP): 2018 $ 19,210 $ (19,210) $ - $ 669,059 2.87% 2019 $ 17,951 $ (17,951) $ - $ 665,832 2.700% 2020 $ 25,744 $ (25,744) $ - $ 683,409 3.77% 2021 $ 26,048 $ (26,048) $ - $ 729,168 3.57% 2022 $ 20,890 $ (20,890) $ - $ 717,059 2.91% 2023 $ 21,751 $ (21,751) $ - $ 721,455 3.01% See accompanying notes to Required Supplementary Information. 89 0 0 0® o 0 o a 0 0 0 0 0 o a o 0 0 0 KODIAK ISLAND BOROUGH Notes to Required Supplementary Information Year Ended June 30, 2023 Budgets and Budgetary Accounting 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 r becomes the adopted budget. 1 • 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: I — All new appropriations are authorized by an appropriation ordinance that amends the annual budget ordinance. r — A resolution of the Borough Assembly is required to move (appropriate) amounts between 11 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 2023 budget document. That document may be obtained from the Kodiak Island Borough, Finance Director, 710 Mill Bay Road, Kodiak, Alaska 99615. LExcess of Expenditures over Appropriations The Assembly approves operating budgets and appropriations of direct costs at the function and department level for the General Fund, and at the function level for all other funds. For the year ended June 30, 2022, expenditures exceeded appropriations in the following funds: L General Fund: General government — finance department $ 11,651 Community and economic development — building official 42,029 Education, culture and recreation 517 Education Support Special Revenue Fund — Primary and secondary education 50 L90 2. KODIAK ISLAND BOROUGH O Notes to Required Supplementary Information, Continued Public Employees' Retirement System n Schedule of Borough's Proportionate Share of Net Pension and OPEB Liability (Asset) U The table is presented based on the Plan measurement date which is one year prior to fiscal year end for all years presented. Changes in Actuarial Assumptions, Methods, and Benefits Since the Prior Valuation Q Defined Benefit Pension and Postemployment Healthcare Benefit Plan Ll a) Changes in Methods Since the Prior Valuation — June 30, 2020 to June 30, 2021 a There were no changes in actuarial methods since the prior valuation. b) Changes in Assumptions Since the Prior Valuation — June 30, 2020 to June 30, 2021 Healthcare claim costs are updated annually. Retired member contributions were updated to reflect the 5% decrease from CY20 to CY21. The amounts included in the normal cost for administrative 0 expenses were changed from $7,223,000 to $7,625,000 for pension, and from $4,934,000 to $5,531,000 for healthcare (based on the most recent two years of actual administrative expenses paid from plan assets). There were no other changes in actuarial assumptions since the prior valuation. c) Changes in Benefit Provisions Since the Prior Valuation —June 30, 2020 to June 30, 2021 There were no changes in benefit provisions since the prior valuation. Defined Contribution Occupational Death and Disability and Retiree Medical Benefits Plan a) Changes in Methods Since the Prior Valuation —June 30, 2020 to June 30, 2021 a There were no changes in actuarial methods since the prior valuation. b) Changes in Assumptions Since the Prior Valuation — June 30, 2020 to June 30, 2021 Healthcare claim costs are updated annually. The amounts included in the normal cost for administrative expenses were changed from $1,000 to $16,000 for occupational death and disability, and from $20,000 to $24,000 for retiree medical (based on the most recent two years of actual administrative expenses paid from plan assets). There were no other changes in actuarial assumptions since the prior valuation. c) Changes in Benefit Provisions Since the Prior Valuation —June 30, 2020 to June 30, 2021 n There have been no changes in benefit provisions valued since the prior valuation. ILJI The GASB requires ten years of information be presented. However, until a full ten years of information is available, the Borough will present only those years for which information is available. Schedule of Borough's Contributions (Pension) and (OPEB) The table valuation date is June 30,202 1, which was rolled forward to June 30, 2022. Actuarially determined contribution rates are calculated as of June 30", two years prior to the fiscal year in which contributions are reported. 91 a ADDITIONAL SUPPLEMENTARY INFORMATION r r r KODIAK ISLAND BOROUGH Budgetary Comparison Schedule Debt Service Fund - Education Year ended Jane 30, 2023 (With summarized financial information for the year ended June 30, 2022) L L L L L Revenues: I Property taxes and assessments I Intergovernmental: State sources Variance with Total revenues Expenditures: General government Debt service: Principal Positive Interest Original Total expenditures Actual Excess (deficiency) of revenues ` over expenditures FEE Other financing sources (uses): 2,062,821 Transfers in - General Fond (1,604) Transfers out - General Fund 5,391,462 Transfers out - Facilities Special Revenue Fund 5,872,228 Transfers out - Renewal and Replacement L Projects Capital Project Fund 7,454,283 Net other financing sources (uses) 479,162 Change in fund balance F[ Fund balance, at beginning of year Fund balance, at end of year 6,300 3,159 L L L L L L 92 2023 Variance with Final Budget— Budget Positive 2022 Original Final Actual (Negative) Actual $ 2,062,821 2,062,821 2,061,217 (1,604) 2,415,377 5,391,462 5,391,462 5,872,228 480,766 14,669,216 7,454,283 7,454,283 7.933,445 479,162 17,084,593 6,300 6,300 3,159 3,141 6,990 6,035,000 6,035,000 6,035,000 — 5,840,000 1,531,318 1,531,318 1,531,316 2 1,719,024 7,572,618 7,572,618 7,569,475 3,143 7,566,014 (118,335) (118,335) 363,970 482,305 9,518,579 118,335 118,335 — (118,335) 2,303,196 — (5,879,272) (5,879,272) - - (2,213,366) (2,213,366) — — (4,047,302) (4,047,302) — — 118,335 (12.021,605) (12,139,940) (118,335) 2,303,196 $ — (12.139,940) (11,775,970) 363.970 11,821,775 12,463,176 641,401 $ 687.206 12,463,176 L 92 C I LI t 1 (This page was left blank intentionally.) a I CI C L L. HI J 11 f 0 0 NONMAJOR GOVERNMENTAL FUNDS Special Revenue See Special Revenue section of this report. Capital Projects See Capital Projects section of this report. r KODIAK ISLAND BOROUGH L L 1. Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities: Accounts payable Customer deposits Unearned revenues Total liabilities Deferred inflows of resources - Unavailable revenues Total liabilities and deferred inflows of resources Fund balances: Nonspendable Restricted Committed Assigned Unassigned Total fund balances Total 142,412 272,166 Combining Balance Sheet 553,508 3,348 - 3,348 Nonmajor Governmental Funds 29,600 29,600 16,508 June 30, 2023 272,166 447,526 571,466 (With summarized financial information at June 30, 2022) 58,042 7,490 Special Capital 70,994 Revenue Project 233,402 Totals 513,058 Assets Funds Funds 2022 Equity in central treasury $ 5,516,361 12,786,824 18,303,185 13,318,811 EEE Receivables: 54,247 47,010 5,329,401 - Federal government - 5,184 5,184 - 12,520,702 Property taxes, net 20,074 8,350 28,424 21,002 (984) Land sales contracts, due within one year 12,075 12,075 11,015 $ 5,611,569 Accounts and other receivables, net 33,409 - 33,409 36,821 Prepaid items 1,745= 1,745 6,048 �- Due from KIBSD 313,444 Land sale contracts, due after one year 27,905 27,905 39,057 Total assets $ 5,611,569 12,800,358 18,411,927 13,746,198 r L L 1. Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities: Accounts payable Customer deposits Unearned revenues Total liabilities Deferred inflows of resources - Unavailable revenues Total liabilities and deferred inflows of resources Fund balances: Nonspendable Restricted Committed Assigned Unassigned Total fund balances Total 142,412 272,166 414,578 553,508 3,348 - 3,348 1,450 29,600 29,600 16,508 175,360 272,166 447,526 571,466 58,042 7,490 65,532 70,994 233,402 279,656 513,058 642,460 1,745 1,745 6,048 54,247 - 54,247 47,010 5,329,401 - 5,329,401 4,844,771 - 12,520,702 12,520,702 8,206,893 (7,226) - (7,226) (984) 5,378,167 12,520,702 17,898,869 13,103,738 $ 5,611,569 12,800,358 18,411,927 13,746,198 L 93 KODIAK ISLAND BOROUGH Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds Year ended June 30, 2023 (With summarized financial information for year ended June 30, 2022) Revenues: Property taxes and assessments Transient accommodations tax Intergovernmental: State sources Federal sources Charges for services Licenses, permits and fees Investment income (loss) Rentals Other Total revenues Expenditures: Current: General government Public safety Community and economic development Service district maintenance Capital outlay: Schools General Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Land sales proceeds Proceeds from sale of capital assets Transfers in Transfers out Net other financing sources (uses) Change in fund balances Fund balances, at beginning of year Fund balances, at end of year Special Capital Revenue Project Totals Funds Funds 2023 2022 $ 1,583,789 497,903 2,081,692 1,546,551 122,016 - 122,016 101,447 10,815 - 10,815 7,899 - 5,335 5,335 89,103 839,169 - 839,169 839,987 37,200 - 37,200 33,600 70,313 32,609 102,922 (342,339) 15,100 15,100 8,400 36,565 676,748 713,313 530,831 2,714,967 1,212,595 3,927,562 2,815,479 677,435 - 677,435 687,676 574,875 - 574,875 422,862 105,886 - 105,886 228,300 700,146 700,146 856,657 - 461,278 461,278 137,568 2,000 684,810 686,810 516,580 2,060,342 1,146,088 3,206,430 2,849,643 654,625 66,507 721,132 (34,164) 15,540 - 15,540 15,440 11,157 - 11,157 - 4,352,343 4,352,343 1,987,389 (200,000) (105,041) (305,041) (1,143,000) (173,303) 4,247,302 4,073,999 859,829 481,322 4,313,809 4,795,131 825,665 4,896,845 8,206,893 13,103,738 12,278,073 $ 5,378,167 12,520,702 17,898,869 13,103,738 94 I 11 lil I 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. I Fund accounts for the activities related to maintenance service to roads within the district, including snow removal, ditching and grading. The Womens Bay Road Service Area Fund accounts for the activities related to maintenance service to roads within the service area, including snow and ice removal, ditching and culvert work. The Bay View Road Service Area Fund accounts for the activities related to road services within the service area. The Service Area No. 2 Fund accounts for the activities related to water and sewer services in the service area. This fund is in the design stage at present. The Local Emergency Planning Committee (L.E.P.C.) Fund accounts for State of Alaska grants provided for regional emergency preparation, response, and mitigation planning. The Land Sales Fund accounts for the disposal of Borough -owned lands. The proceeds of land disposals are generally used for the management of Borough lands and the repairs and maintenance of Borough school buildings. The Buildings and Grounds Fund accounts for the operations and maintenance of certain buildings and grounds owned by the Borough which are jointly shared with the City of Kodiak, the Kodiak Island Borough School District, and certain nonprofit community organizations. The Woodland Acres Street Light Service Area Fund accounts for activities related to the provision of street lighting within the service area. The Trinity Islands Street Light Service Area Fund accounts for activities related to the provision of street lighting within the service area. The Tourism Development Fund accounts for the collection of the Borough Transient Accommodation Tax (Bed Tax) and its subsequent transfer to the Kodiak Island Convention and Visitor Bureau. The Mission Lake Tide Gate Fund accounts for activities related to maintaining the tide gate for the residents of the service area. The Fern Fuller Trust Fund accounts for the distribution of funds to the beneficiaries of the trust. The Trinity Islands Paving Fund accounts for activities related to the provision of paving within the service area. The Oil Spill Disaster Fund accounts for activities related to the grounding of the drilling vessel Kulluk. r- rt � = = r" = rC"" ''"" r"a """,a" � ^ """ ^" "_i --y = "1 KODIAK ISLAND BOROUGH Nonmajor Special Revenue Fonds Combining Balance Shell June 30, 2023 (With summarized financial information at lune 30, 2022) Liabilities: Fire and Road Service At.. State Grant Accounts payable 4,073 Fire - - 67,963 Road - - Program Customer deposits Fire Winners Kodiak Monashka - War ms - - - Unearned revenues Protection Bay Fire Airport Fire Bay Road Service Bay Road any View Road Service Area Assets Area No. I Department District Service Area Area No. 1 Service Area Service Area No. 2 LE.P.C. Equity in central treasury S 926.683 749.897 52,328 232,895 1,051,672 63,936 32,963 6,063 22,824 Receivables: 6,800 439 3,029 1,911 4,832 879 160 Property taxes, net 8,259 439 3,029 1.911 5,385 879 160 - - Land sales contracts, due within one year - - - - - - - - - Accounts and other receivables, net - - - - - - - - - Prepaid items 1,745 - - - - - - - - Land sale contracts, due after one year - - - - - - - - - Total assets S 936,687 750,336 55,357 234,806 1,057,057 64,815 33,123 6,063 22,824 Liabilities, Deferred Inflows of Resources, - - (7,226) - - - and Fund Balances 925,814 745,547 52,328 232,895 984,262 (7,226) 32,%3 6,063 22,824 Liabilities: Accounts payable 4,073 600 - - 67,963 43,562 - - Customer deposits - 2.750 - - - - - - - Unearned revenues 1,000 27,600 Total liabilities 4,073 4,350 67,963 71,162 Deferred inflows of resources: Unavailable revenues 6,800 439 3,029 1,911 4,832 879 160 Total liabilities and deferred inflows ofresources 10,873 4,789 3,029 1,911 72,795 72,041 160 Fund balances: Nonspendabie 1,745 - - - - - - - - Restnded - - - - - - - - - Committed 924,069 745,547 52,328 232,895 984,262 - 32.963 6.063 22,824 Unassigned - - (7,226) - - - Total Said balances 925,814 745,547 52,328 232,895 984,262 (7,226) 32,%3 6,063 22,824 Total $ 936,687 750,336 55,357 234,806 1,057,057 64,815 33,123 6,063 22,824 (continued) 95 Assets Equity in central treasury Receivables'. property taxes, net Land sales contacts, due within one year Accounts and other receivables, net Prepaid items Land sale commas, due after one year Total assets Liabilities, Deferred Inflows of Resources, and Fund Balances Liabilities: Accounts payable Customer deposits Unearned revenues Total liabilities Deferred inflows of resources, Unavailable revenues Total liabilities and deferred inflows of resources Fund balances'. Nonspendable Restricted Committed Unassigned Total fund balances Total KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Combining Balance Sheet, (continued) June 30, 2023 ( With summarized financial information at June 30. 2022) 96 Street Lighting Districts Woodland Buildings Acres Street Trinity Islands Commercial Opioiod and Light Service Street Light Tourism Passenger Mission Lake Class Action Totals Land Sales Grounds Arca Service Area Development Vessel Tide Gate Settlement 2023 2022 S 1,340,527 742.834 20,438 31,087 85,203 54.247 60,113 42651 5,516,361 5,117,589 - - 12 - - - - - 20,074 15,553 12,075 - - - - - - - 12,075 11,015 2.607 120 - - 30,682 - - - 33,409 36,821 - - - - - - - - 1,745 6,048 27,905 - 27,905 39,057 $ 1383,114 742.954 20.450 31.087 115,885 54,247 60,113 42,651 5,611,569 5,226.083 - 25.664 444 106 - - - - 142,412 260,243 - 598 - - - - - - 3,348 1,450 1,000 29,600 2,000 1,000 26,262 444 106 175,360 263,693 39,980 12 58,042 65,545 40,980 26,262 456 106 233,402 329,238 - - - - - - - - 1,745 6,048 - - - - - 54,247 - - 54,247 47,010 1.342,134 716,692 19,994 30,981 115,885 - 60,113 42,651 5,329,401 4,844,771 (7,226) (984) 1,342,134 716,692 19,994 30,981 115,885 54,247 60,113 42,651 5,378,167 4,896,845 S 13_83114 742,954 20,450 31.087 115,885 54,247 60,113 42,651 5.611.569 52_26083 96 r.- r'_' r- r- r-• r-- ro", "aa ra"" M" ^ �" """ ^ "1 --I "n "" ,_ KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit) Year ended June 30, 2023 ( With summarized financial information for the year ended lune 30, 2022) 97 Fire and Road Service Areas State Grant Fire Road 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 $ 680,148 118,743 20,162 54,451 457,169 228,071 15,612 - - Transientaccommodationstax - - - - - - - - - Intergovemmental: State sources 2,133 - - - - - - - - Federal sources - - - - - - - - - Charges for services - 20,025 - - - - - - - Licenses, permits and fees - - - - - 27,600 - - - Investmentincome(loss) 18,218 9,774 155 2,812 11,851 1,371 275 60 - Rentals - 15,100 - - - - - - - Other 1,104 200 280 Total revenues 701,603 163,842 20,317 57,263 469,300 257,042 15,887 60 Expenditures: Current General government - - - - - - - - Public safety 325,433 229,328 20,114 - - - - - - Community and economic development - - - - - - - - - Service district maintenance - - - 25,556 374,734 263,284 35,696 - - Capital outlay - general 2,000 Total expenditures 327,433 229,328 20,114 25,556 374,734 263,284 35,696 Excess (deficiency) ofrevenues over expenditures 374,170 (65,486) 203 31,707 94,566 (6,242) (19,809) 60 - Other financing sources (uses): Land sale proceeds - - - - - - - - - Proceedsfromsaleofcapitalassets 11,157 - - - - - - - - Transfers in - - - - - - - - - Transfers out (100,000) Net other financing sources (uses) (88,843) Change in fund balances 285,327 (65,486) 203 31,707 94,566 (6,242) (19,809) 60 - Fund balances (deficit), at beginning ofycar 640,487 811,033 52,125 201,188 889,696 (984) $2,772 6,003 22,824 Fund balances (deficit), in end ofyear S 925,814 745,547 52,328 232,895 984,262 (7,226) 32,963 6,063 22,824 (continued) 97 KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit), (continued) Year ended June 30, 2023 (With summarized financial information for the year ended June 30, 2022) 98 Street Lighting Districts Buildings Woodland Acres Trinity Islands Commercial Opioid and Street Light Street Light Tourism Passenger Mission Lake Class Action Totals Land Sales Grounds Service Area Service Area Development Vessel Tide Gate Settlement 2023 2022 Revenues: Property taxes and assessments $ - - 5,844 1,988 - - 1,601 - 1,583,789 1,546,551 Transient accommodations tax - - - - 122,016 - - - 122,016 101,447 Intergovernmental: State sources - 1,937 - - - 6,745 - - 10,815 7,899 Federal sources - - - - - - - - - 13,021 Charges for services 2,357 816,787 - - - - - - 839,169 839,987 Licenses, permits and fees 9,600 - - - - - - - 37,200 33,600 Investment income (loss) 13,191 8,094 240 323 1,544 562 609 1,234 70,313 (343,519) Rentals - - - - - - - - 15,100 8,400 Other 100 120 34,761 36,565 63,643 Total revenues 25,248 826,938 6,084 2,311 123,560 7,307 2,210 35,995 2,714,967 2,271,029 Expenditures: Current General government 19,629 650,752 5,659 1.395 - - - - 677,435 687,676 Public safety - - - - - - - - 574,875 422,862 Community and economic development - - - - 105,816 70 - - 105,886 228,300 Service district maintenance - - - - - - 876 - 700,146 856,657 Capital outlay - general - - - - - 2,000 6,500 Total expenditures 19,629 650,752 5,659 1,395 105,816 70 876 - 2,060,342 2,201,995 Excess (deficiency) of revenues over expenditures 5,619 176,186 425 916 17,744 7,237 1,334 35,995 654,625 69,034 Other financing sources (uses): Land sales proceeds 15,540 - - - - - - - 15,540 15,440 Proceeds from sale ofcapital assets - - - - - - - - 11,157 - Transfers in - - - - - - - - - 5,000 Transfers out (100,000) (200,000) (1,140,423) Net other financing sources (uses) 15,540 (100,000) - - - - - - (173,303) (1,119,983) Change in fund balances 21,159 76,186 425 916 17,744 7,237 1,334 35,995 481,322 (1,050,949) Fund balances (deficit), at beginning ofyear 1,320,975 640,506 19,569 30,065 98,141 47,010 58,779 6,656 4,896,845 5,947,794 Fund balances (deficit), at end ofyear $ 1,342,134 716,692 19,994 30,981 115,885 54,247 60,113 42,651 5,378,167 4,896,845 98 r 11 r 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, 2023 (With financial information for the year ended June 30, 2022) (- Revenues: 1! Property taxes and assessments Intergovernmental: State sources - PERS on -behalf payment Federal sources Investment income (loss) Other C I I L Total revenues Expenditures: Public safety: Personnel Volunteers Fringe benefits Professional services Support goods and services Repairs and maintenance Total public safety Capital outlay - general Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Proceeds from sale of capital assets Transfers in - Other Capital Projects Capital Project Fund Transfers out - Other Capital Projects Capital Project Fund Net other financing sources (uses) Change in fund balance Fund balance, at beginning of year Fund balance, at end of year 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ 687,000 680,148 (6,852) 671,724 5,000 2,133 (2,867) 2,999 7,500 - (7,500) 4,500 5,000 18,218 13,218 (46,900) 4,000 1,104 (2,896) 1,847 708,500 701,603 (6,897) 634,170 92,000 92,412 (412) 65,846 51,200 26,154 25,046 55,483 72,037 59,243 12,794 43,571 12,000 14,180 (2,180) 14,857 228,600 121,403 107,197 159,061 18,000 12,041 5,959 19,517 473,837 325,433 148,404 358.335 350,000 2,000 348,000 6.500 823,837 327,433 496,404 364,835 (115,337) 374,170 489,507 269,335 11,157 11,157 - 2,577 (100,000) (100,000) (100,000) (88,843) 11,157 2,577 $ (215,337) 285,327 500,664 271,912 640,487 368,575 $ 925,814 640,487 99 L 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, 2023 (With financial information for the year ended June 30, 2022) Total revenues Expenditures: Public safety: Personnel services Fringe benefits Professional services Support goods and services Repairs and maintenance Total public safety Excess (deficiency) of revenues over expenditures Other financing (uses): Transfers out - Other Capital Projects Capital Project Fund Change in fund balance Fund balance, at beginning of year Fund balance, at end of year IJY,cw iw,0'z 2023 7"VU1 2,000 1,863 137 546 Variance with 371 1,954 76 11,000 Final Budget 5,353 2,229 Final 215,152 Positive 2022 25,000 Budget Actual (Negative) Actual Revenues: (90,128) 48,021 Property taxes and assessments $ 108,500 118,743 10,243 111,115 Intergovernmental - federal sources 8,521 Charges for services 16,700 20,025 3,325 16,420 Investment income (loss) 2,000 9,774 7,774 (50,689) Rentals 12,000 15,100 3,100 8,400 Other - 200 200 300 Total revenues Expenditures: Public safety: Personnel services Fringe benefits Professional services Support goods and services Repairs and maintenance Total public safety Excess (deficiency) of revenues over expenditures Other financing (uses): Transfers out - Other Capital Projects Capital Project Fund Change in fund balance Fund balance, at beginning of year Fund balance, at end of year IJY,cw iw,0'z ZY'V'z 7"VU1 2,000 1,863 137 546 2,325 371 1,954 76 11,000 5,647 5,353 2,229 98,875 215,152 (116,277) 44,267 25,000 6,295 18,705 903 139,200 229,328 (90,128) 48,021 - (65,486) (65,486) 46,046 (50,000) - 50,000 $ (50,000) (65,486) (15,486) 811,033 $ 745,547 100 46,046 764,987 811,033 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, 2023 (With financial information for the year ended June 30, 2022) 101 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Revenues: Property taxes and assessments $ 18,200 20,162 1,962 20,005 Investment income (loss) — 155 155 (2,998) Total revenues 18,200 20,317 2,117 17,007 Expenditures: Public safety: Professional services 18,100 20,027 (1,927) 16,420 Support goods and services 100 87 13 86 Total expenditures 18,200 20,114 (1,914) 16,506 Excess of revenues over expenditures $ — 203 203 501 Fund balance, at beginning of year 52,125 51,624 Fund balance, at end of year $ 52,328 52,125 101 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, 2023 (With financial information for the year ended June 30, 2022) Revenues: Property taxes and assessments Investment income (loss) Total revenues Expenditures: Service district maintenance: Personnel services Fringe benefits Support goods and services Snow removal/sanding Road grading/ditching Repairs and maintenance Total expenditures Excess (deficiency) of revenues over expenditures Fund balance. at beginning of year Fund balance, at end of year $ (10,000) 31,707 41,707 201,188 $ 232,895 102 (54,566) 255,754 201,188 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ 52,238 54,451 2,213 53,581 - 2,812 2,812 (15.151) 52,238 57,263 5,025 38,430 400 58 342 56 - 16 (16) 57 1,600 182 1,418 109 14,000 13,622 378 22,431 21,238 - 21,238 1,136 25,000 11,678 13,322 69,207 62,238 25,556 36,682 92,996 $ (10,000) 31,707 41,707 201,188 $ 232,895 102 (54,566) 255,754 201,188 A I I L I L L L L KODIAK ISLAND BOROUGH Nonm ijor 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, 2023 (With financial information for the year ended June 30, 2022) Revenues: Property taxes and assessments Investment income (loss) Other Total revenues Expenditures: Service district maintenance: Personnel services Fringe benefits Support goods and services Snow removal/sanding Road grading/ditching Repairs and maintenance Total expenditures Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year L 103 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ 452.000 457,169 5,169 451,996 - 11,851 11,851 (66,350) 280 280 365 452.000 469,300 17,300 386,011 8,800 5,264 3,536 5,595 2,350 1,009 1,341 1,303 13,600 851 12,749 5,744 200,000 193,229 6,771 213,159 60,000 51,268 8,732 35,580 167,250 123,113 44,137 185,777 452,000 374,734 77,266 447,158 $ - 94,566 94.566 (61,147) 889,696 950,843 $ 984,262 889,696 L 103 I KODIAK ISLAND BOROUGH D Nonmajor Special Revenue Funds 214,121 Fire and Road Service Areas — Womens Bay Road Service Area D Schedule of Revenues, Expenditures, and Changes in Fund Balance (Deficit) 27,600 Budget and Actual 1,371 Year ended June 30, 2023 D ( With financial information for the year ended June 30, 2022) 257,042 19,442 D 2023 Variance with 800 Final Budget 711 Final Positive 2022 — Budget Actual (Negative) Actual (26) 669 n Revenues: Property taxes and assessments Licenses, permits and fees Investment income (loss) Total revenues Expenditures: Service district maintenance: Personnel services Fringe benefits Support goods and services Snow removal/sanding Road grading/ditching Repairs and maintenance Total expenditures Excess (deficiency) of revenues over expenditures Fund balance (deficit), at beginning of year Fund balance (deficit), at end of year $ 210,000 228,071 18,071 214,121 27,600 27,600 — 27,600 1,371 1,371 (6,391) 237,600 257,042 19,442 235,330 800 89 711 60 — 26 (26) 669 16,800 401 16,399 70,000 67,717 2,283 112,431 50,000 30,815 19,185 21,950 100,000 164,236 (64,236) 167,920 237,600 263,284 (25,684) 303,030 $ — (6,242) (6,242) (67,700) 104 (984) $ (7.226) 66,716 (984) r I L L L L L 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, 2023 (With financial information for the year ended June 30, 2022) Revenues: Property taxes and assessments Investment income (loss) Total revenues Expenditures: Service district maintenance: Personnel services Fringe benefits Professional services Support goods and services Snow removal/sanding Road grading/ditching Repairs and maintenance Total expenditures Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year 2023 Final Budget Actual Variance with Final Budget Positive 2022 (Negative) Actual $ 14,500 15,612 1,112 14,553 — 275 275 (3,382) 14,500 15,887 1,387 11,171 — 83 — 65 — 55 — 83 3,000 6,313 2,700 1,235 8,800 27,862 14,500 35,696 $ — (19,809) 52,772 $ 32,963 L 105 (83) (65) (55) (83) (3,313) 1,465 (19,062) (21,196) 130 77 84 6,403 142 3,755 10,591 (19,809) 580 52,192 52,772 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, 2023 (With financial information for the year ended June 30, 2022) Revenues: Investment income (loss) Expenditures Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ — 60 60 (364) $ — 60 60 (364) 6,003 6,367 $ 6,063 6,003 106 KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds L.E.P.C. Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Year ended June 30, 2023 ( With financial information for the year ended June 30, 2022) Revenues Expenditures: Public safety: Support goods and services Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year Final Budget 1,000 $ (1,000) 107 2023 Variance with Final Budget Positive 2022 Actual (Negative) Actual 22,824 $ 22,824 1,000 1,000 22,824 22,824 Revenues: Charges for services Licenses, permits and fees Investment income (loss) Other Total revenues II KODIAK ISLAND BOROUGH 1,145 (145) p Nonmajor Special Revenue Funds 49 (49) - Land Sales 6,830 (6,830) p Schedule of Revenues, Expenditures, and Changes in Fund Balance 11,605 39,015 Budget and Actual 51,620 19,629 31,991 Year ended June 30,2023 (15,540) (With financial information for the year ended June 30, 2022) 21,159 (134,764) 15,540 15,540 — 15,440 $ — 2023 21,159 (119,324) 1,320,975 Variance with 1,440,299 $ 1342.134 Final Budget 1,320.975 Final Positive 2022 Budget Actual (Negative) Actual $ 30,000 2,357 (27,643) 5,585 6,000 9,600 3,600 6,000 13,191 13,191 (82,725) 80 100 20 80 36,080 25,248 (10,832) (71,060) Expenditures: General government: Personnel services Fringe benefits Professional services Support goods and services Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources: Land sale proceeds Change in fund balance Fund balance, at beginning of year Fund balance, at end of year 1,000 1,145 (145) - - 49 (49) - - 6,830 (6,830) — 50,620 11,605 39,015 63,704 51,620 19,629 31,991 63,704 (15,540) 5,619 21,159 (134,764) 15,540 15,540 — 15,440 $ — 21,159 21,159 (119,324) 1,320,975 1,440,299 $ 1342.134 1,320.975 108 A r F I I I I L L L KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Buildings and Grounds Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Year ended lune 30, 2023 (With financial information for the year ended lune 30, 2022) Revenues: Intergovernmental: State sources - PERS on -behalf payment Charges for services Investment income (loss) Other Total revenues Expenditures: General government: School buildings Borough building Mental health center Various borough buildings Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Transfers in: Facilities Special Revenue Fund Transfers out: Borough Capital Projects Capital Project Fund Renewal and Replacement Projects Capital Project Fund Net other financing sources (uses) Change in fund balance Fund balance, at beginning of year Fund balance, at end of year 2023 Variance with Final Budget Final Positive Budget Actual (Negative) 2022 Actual $ - 1,937 1,937 4,900 922,043 816,787 (105,256) 817,982 8,094 8,094 (49,337) - 120 120 120 922,043 826,938 (95,105) 773,665 499,400 186,536 312,864 222,267 574,115 384,359 189,756 353,136 33,200 55,521 (22,321) 29,587 35,100 24,336 10,764 11,853 1,141,815 650,752 491,063 616,843 (219,772) 176,186 395,958 156,822 (45,000) (45,000) (55,000) (55,000) (100,000) (100,000) S (319.772) 76,186 395.958 L 109 640.506 $ 716,692 5,000 (28,000) (1,115,000) (1,138,000) (981,178) 1,621,684 640,506 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, 2023 (With financial information for the year ended June 30, 2022) 110 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Revenues: Property taxes and assessments $ 5,800 5,844 44 5,899 Investment income (loss) — 240 240 (1,310) Total revenues 5,800 6,084 284 4,589 Expenditures: General government - Support goods and services 5,800 5,659 141 5,623 Excess (deficiency) of revenues over expenditures $ — 425 425 (1,034) Fund balance, at beginning of year 19,569 20,603 Fund balance, at end of year $ 19,994 19,569 110 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, 2023 ( With financial information for the year ended June 30, 2022) Revenues: Property taxes and assessments Investment income (loss) Total revenues Expenditures: General government - Support goods and services Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year 2023 1,900 1,395 $ — 916 30,065 $ 30,981 111 505 916 2022 Actual 1,922 (1,854) 68 1,506 (1,438) 31,503 30,065 Variance with Final Budget Final Positive Budget Actual (Negative) $ 1,900 1,988 88 — 323 323 1,900 2,311 411 1,900 1,395 $ — 916 30,065 $ 30,981 111 505 916 2022 Actual 1,922 (1,854) 68 1,506 (1,438) 31,503 30,065 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, 2023 (With financial information for the year ended June 30, 2022) 112 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Revenues: Transient accommodations tax $ 75,150 122,016 46,866 101,447 Investment income (loss) — 1,544 1,544 (4,725) Total revenues 75,150 123,560 48,410 96,722 Expenditures: Community and economic development: Personnel services 20,417 (20,417) Fringe benefits — 9,472 (9,472) — Contributions 75,000 75,000 — 75,000 Support goods and services 150 927 (777) 228 Total expenditures 75,150 105,816 (30,666) 75,228 Excess of revenues over expenditures $ — 17,744 17,744 21,494 Fund balance, at beginning of year 98,141 76,647 Fund balance, at end of year $ 115,885 98,141 112 KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Commercial Passenger Vessel Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Year ended June 30, 2023 ( With financial information for the year ended lune 30, 2022) 113 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Revenues: Intergovernmental - State sources - Commercial passenger vessel tax 5.000 6,745 1,745 — Investment income (loss) $ — 562 562 (7,673) Other 54,220 Total revenues 5,000 7,307 2,307 46,547 Expenditures: Community and economic development - Support goods and services 5,000 70 4,930 153,072 Excess (deficiency) of revenues over expenditures $ — 7,237 7,237 (106,525) Fund balance, at beginning of year 47,010 153,535 Fund balance, at end of year $ 54,247 47.010 113 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, 2023 (With financial information for the year ended June 30, 2022) Revenues: Properly taxes and assessments Investment income (loss) Total revenues Expenditures: Service district maintenance: Personnel services Fringe benefits Support goods and services Professional services Repairs and maintenance Total expenditures Excess (deficiency) of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year 2023 Final Budget Actual $ 1,700 1,601 500 609 2,200 7210 300 280 205 1,415 2,200 114 402 280 74 120 876 1,334 58,779 $ 60,113 Variance with Final Budget Positive 2022 (Negative) Actual (99) 1,635 109 (3,615) 10 (1,980) (102) 669 — 276 131 74 (120) — 1,415 1,863 1,324 2,882 1,334 (4,862) 63,641 58,779 KODIAK ISLAND BOROUGH Nonmajor Special Revenue Funds Opioid Class Action Settlement Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Revenues: Investment income (loss) Other income Total revenues Expenditures Excess of revenues over expenditures Fund balance, at beginning of year Fund balance, at end of year 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ — 1,234 1,234 (55) — 34,761 34,761 6,711 — 35,995 35,995 6,656 115 35,995 6,656 $ 42,651 35,995 6,656 6,656 I I I I I I (This page was left blank intentionally.) D L H F L L! L L I I I I I 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 School Renewal and Replacement Facilities Bond Projects accounts for bond funded renewal and replacement projects for the Borough's schools. The Other Capital Projects Fund accounts for capital improvement projects related to various financing sources. r Pr"" r- r" r- r_ r p" !'"" r",""" a "" ^ -! � "" ^" -" 1 "1 "-1 KODIAK ISLAND BOROUGH Nonmajor Capital Project Funds Combining Balance Sheet June 30, 2023 ( With summarized financial information at June 30, 2022) 116 School Renewal Borough School Bond Kodiak High Renewal and and Replacement Other Capital Capital School Replacement Facilities Bond Capital Totals Assets Projects Projects Renovation Projects Projects Projects 2023 2022 Equity in central treasury $ 780,021 70328 742,275 7,856,292 1,264,202 2,073,706 12,786,824 8,201,222 Receivables: Federal government - - - - - 5,184 5,184 - Property taxes - - - 8,350 - - 8,350 5,449 Due from KIBSD 313,444 Total $ 780.021 70.328 742,275 7.864.642 1,264,202 2.078.890 12,800.358 8,520,115 Liabilities and Fund Balances Liabilities: Accounts payable 3,039 266,415 2,712 272,166 293,265 Uneamed revenues 14,508 Total liabilities - - - 3,039 266,415 2,712 272,166 307,773 Deferred inflows of resources: Unavailable revenues 7,490 7,490 5,449 Total liabilities and deferred inflows of resources 10,529 266,415 2,712 279,656 313,222 Fund balances: Assigned 780,021 70,328 742,275 7,854,113 997,787 2,076,178 12,520,702 8,206,893 Total $ 780,021 70,328 742,275 7,864,642 1,264,202 2,078,890 12,800,358 8,520,115 116 Revenues: Property taxes and assessments Intergovernmental: Federal sources Investment income Other Total revenues Expenditures: Capital outlay: Schools General Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses): Transfers in Transfers out Net other financing sources (uses) Change in fund balances Fund balances, at beginning of year Fund balances, at end of year KODIAK ISLAND BOROUGH Nonmajor Capital Project Funds Combining Statement of Revenues. Expenditures, and Changes in Fund Balances Year ended June 30, 2023 (With summarized financial information for the year ended June 30, 2022) 117 School Renewal Borough School Bond Kodiak High Renewal and and Replacement Other Capital Capital School Replacement Facilities Bond Capital Totals Projects Projects Renovation Projects Projects Projects 2023 2022 $ - - - 497,903 - - 497,903 - - - - - - 5,335 5,335 76,082 - 32,609 - - - - 32,609 1,180 401,001 275,747 676,748 467,188 32,609 898,904 275,747 5,335 1,212,595 544,450 191,530 269,748 - 461,278 137,568 447 630,127 54,236 684,810 510,080 191,977 630,127 269,748 54,236 1,146,088 647,648 (191,977) 32,609 - 268,777 5,999 (48,901) 66,507 (103,198) 45.000 - - 4207,343 - 100,000 4,352,343 1,982,389 (105,041) (105,041) (2,577) 45,000 4,207343 (5,041) 4,247,302 1,979,812 (146,977) 32,609 - 4,476,120 5,999 (53,942) 4,313,809 1,876,614 926,998 37,719 742,275 3,377,993 991,788 2,130,120 8,206,893 6,330,279 $ 780,021 70,328 742,275 7,854,113 997,787 2,076,178 12,520,702 8,206,893 117 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, hospital related state revenue sharing, and other hospital related revenue. In turn, it purchases hospital equipment and makes debt service payments on hospital related debt. The Kodiak Fisheries Research Center Fund accounts for rents and expenses on the Borough -owned Kodiak Fisheries Research Center. The three tenants: NOAA, Alaska Department of Fish & Game and University of Alaska, Fairbanks pay lease funds to participate in this multi -agency research facility 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. 19 Assets Current assets: Equity in central treasury Customer receivables Total current assets Capital assets: Depreciable, net Total assets KODIAK ISLAND BOROUGH Combining Statement of Net Position Nonmajor Enterprise Funds June 30, 2023 (With summarized financial information for June 30, 2022) Liabilities and Net Position Current liabilities: Accounts payable Customer deposits Unearned revenues Total current liabilities Net position: Net investment in capital assets Unrestricted Total net position Total liabilities and net position L L L L L 18 Research 911 Court Totals Service Apartments 2023 2022 $ 81,806 139,057 220,863 157,510 38,606 - 38,606 37,773 120,412 139,057 259,469 195,283 - 204,399 204,399 238,466 $ 120,412 343,456 463,868 433,749 120,412 3,976 124,388 118,507 - 7,653 7,653 7,653 6,400 6,400 - 120,412 18,029 138,441 126,160 - 204,399 204,399 238,466 121,028 121,028 69,123 325,427 325,427 307,589 $ 120,412 343,456 463,868 433,749 L 18 LTJ KODIAK ISLAND BOROUGH a Combining Statement of Revenues, Expenses, and Changes in Net Position 94,755 Nonmajor Enterprise Funds a Year ended June 30, 2023 - (With summarized financial information for the year ended June 30, 2022) 301,489 Operating revenues: Charges for services: Lease income Other Total operating revenues Operating expenses: Personnel services Maintenance and repairs Depreciation General and administration Miscellaneous Telephone services Total operating expenses Operating income (loss) Nonoperating revenues: Investment income (loss) Change in net position Net position, at beginning of year Net position, at end of year Research 911 Court Totals Service Apartments 2023 2022 $ - 94,755 94,755 85,518 325,981 - 325,981 301,489 325,981 94,755 420,736 387,007 1,500 6,093 7,593 9,335 - 659 659 - - 34,067 34,067 34,067 332 32,710 33,042 34,747 - 5,362 5,362 6,209 324,202 - 324,202 299,459 326,034 78,891 404,925 383,817 (53) 15,864 15,811 3,190 2,027 2,027 (4,149) (53) 17,891 17,838 (959) 53 307,536 307,589 308,548 $ 325,427 325,427 307,589 119 CI KODIAK ISLAND BOROUGH Combining Statement of Cash Flows Nonmajor Enterprise Funds Year ended June 30, 2023 (With summarized financial information for the year ended lune 30, 2022) �^ Cash flows from operating activities: 426,303 Cash received from customers Ef Payments to suppliers (357,384) Payments to employees (1,500) Net cash provided by (7,593) operating activities 2,978 Cash flows from investing activities: 61,326 Interest and dividends received Net change in cash and cash equivalents Cash and equivalents, at beginning of year Cash and equivalents, at end of year 2,027 Reconciliation of operating income (loss) to net cash provided by operating activities: Il Operating income (loss) 60,375 Adjustments to reconcile operating income (loss) 32,556 to net cash provided by operating activities: 78,682 Depreciation 124,954 Changes in assets and liabilities that 139,057 provided (used) cash: 157.510 (Increase) decrease in assets: Customer receivables Increase (decrease) in liabilities: 15,864 Accounts payable 3,190 Unearned revenues 34,067 Net cash provided by 34,067 operating activities I Research 911 Court Service Apartments Totals 2023 2022 $ 325,148 101,155 426,303 391,331 (320,670) (36,714) (357,384) (345,291) (1,500) (6,093) (7,593) (9,335) 2,978 58,348 61,326 36,705 2,027 2,027 (4,149) 2,978 60,375 63,353 32,556 78,828 78,682 157,510 124,954 $ 81,806 139,057 220,863 157.510 $ (53) 15,864 15,811 3,190 - 34,067 34,067 34,067 (833) - (833) 6,825 3,864 2,017 5,881 (4,876) - 6,400 6,400 (2,501) $ 2,978 58,348 61,326 36,705 L 120 KODIAK ISLAND BOROUGH Enterprise Funds Municipal Solid Waste Collection and Disposal Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Operating revenues: Solid waste disposal Other Total operating revenues Operating expenses: Personnel services Contracted services Maintenance, repairs and equipment Depreciation General and administration Recycling services Closure and postclosure costs (reduction) Contributions Total operating expenses Operating income (loss) 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ 4.098.000 4,120,050 22,050 4,161,775 4.000 14,102 10,102 11,846 4.102,000 4,134,152 32,152 4,173,621 1,309,939 1,323,342 (13,403) 560,000 292,008 267,992 892,500 277,754 614,746 281,919 235,004 46,915 676,456 405,399 271,057 300,000 330,396 (30,396) 850,000 (377,580) 1,227,580 180,000 (174,539) 169,935 10,065 5,050,814 (190,144) 2,656,258 2.394.556 (948,814) 1,477,894 21426.708 1,076,559 291,090 121,024 171,026 406,311 310,560 687,590 182.639 3,246,799 926,822 Other income (expense): Intergovernmental: State of Alaska - PERS on -behalf payment 20,500 (20,914) (41,414) (30,724) Investment income (loss) 27,211 (26,417) (53,628) (409,066) Interest expense (237,855) (174,539) 63,316 (126,321) Total other income (expense) (190,144) (221,870) (31,726) (566,111) Change in net position Net position, at beginning of year Net position, at end of year $ (1.138,958) 1,256,024 121 19,470,253 $ 20,726,277 2,394,982 360,711 19,109.542 19.470.253 A F r 1■ I I L L L KODIAK ISLAND BOROUGH Enterprise Funds Hospital Facilities Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Operating expenses Personnel services 40,319 2023 (3,707) 54,890 Contracted services Variance with 120 Maintenance and repairs 266 Final Budget 634 Depreciation Final 1,326,227 Positive 2022 Miscellaneous Budget Actual (Negative) Actual Operating revenues: 1,635,634 1,374,719 260,915 1,115,737 Lease income $ 1,384,272 1,170,808 (213,464) 1,170,808 Interest revenue — 280,574 280,574 334,293 Total operating revenue 1,384,272 1,451,382 67,110 1,505,101 Operating expenses Personnel services 40,319 44,026 (3,707) 54,890 Contracted services 120 Maintenance and repairs 266 (266) 634 Depreciation 1,062,321 1,326,227 (263,906) 1,060,093 Miscellaneous 532,994 4,200 528,794 Total operating expenses 1,635,634 1,374,719 260,915 1,115,737 Operating income (loss) (251,362) 76,663 328,025 389,364 Other income Investment income (loss) 61,084 61,084 (147,331) Change in net position $ (251,362) 137,747 389,109 242,033 Net position, at beginning of year 16,981,814 16,739,781 Net position, at end of year $ 17,119,561 16,981,814 122 KODIAK ISLAND BOROUGH Enterprise Funds Long Term Care Center Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Operating expenses Personnel services - 2023 (1,832) 3,303 Contracted services 10,000 4,856 Variance with 3,848 Maintenance and repairs (273,371) Change in net position Final Budget 362 Depreciation Final 518,933 Positive 2022 General and administration Budget Actual (Negative) Actual Operating revenues: 1,066,430 561,395 505,035 559,101 Lease income $ 1,043,628 765,187 (278,441) 765,187 Interest revenue 434,457 434,457 605,653 Total operating revenues 1,043,628 1,199,644 156,016 1,370,840 Operating expenses Personnel services - 1,832 (1,832) 3,303 Contracted services 10,000 4,856 5,144 3,848 Maintenance and repairs (273,371) Change in net position $ 757,290 362 Depreciation 518,933 518,933 - 518,933 General and administration 537,497 35,774 501,723 32,655 Total operating expenses 1,066,430 561,395 505,035 559,101 Operating income (loss) (22,802) 638,249 661,051 811,739 Other income (expense) Investment income (loss) - 66,264 66,264 (161,880) Interest revenue (expense) 22,802 52,777 29,975 (111,491) Total other income (expense) 22,802 119,041 96,239 (273,371) Change in net position $ 757,290 757,290 538,368 Net position, at beginning of year 7,384,259 6,845,891 Net position, at end of year $ 8,141,549 7,384,259 123 F F I r I I L 1. KODIAK ISLAND BOROUGH Enterprise Funds Kodiak Fisheries Research Center Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) 124 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Operating revenues: Lease income $ 709,885 566,318 (143,567) 566,410 Interest revenue 33,421 360,971 327,550 384,160 Other 3,677 Total operating revenues 743,306 927,289 183,983 954,247 Operating expenses: Personnel services 282,182 168,922 113,260 172,034 Maintenance and repairs 67,000 32,639 34,361 7,486 Depreciation 697,000 719,871 (22,871) 695,985 General and administration: Support goods and services 82,000 12,399 69,601 11,773 Cleaning and janitorial 75,000 47,500 27,500 45,900 Heating 110,000 18,989 91,011 21,140 Electrical 315,000 179,550 135,450 211,004 Plumbing 118,000 106,232 11,768 56,867 Air conditioning 30,000 2,115 27,885 4,372 Elevators 10,000 2,435 7,565 1,905 Miscellaneous 77,500 64,237 13,263 53,530 Total operating expenses 1,863,682 1,354,889 508,793 1,281,996 Operating income (loss) (1,120,376) (427,600) (324,810) (327,749) Other income (expense): Intergovernmental: State of Alaska - PERS on -behalf payment 4,200 (7,339) (11,539) (7,180) Investment income (loss) - 23,524 23,524 (113,816) Total other income (expense) 4,200 16,185 11,985 (120,996) Income (loss) before transfers (1,116,176) (411,415) 704,761 (448,745) Transfers out (1,500,000) 1,500,000 - Change in net position $ (2,616.176) (411,415) 2.204.761 (448,745) Net position, at beginning of year 9,784,510 10,233,255 Net position, at end of year $ 9,373,095 9,784.510 124 KODIAK ISLAND BOROUGH Enterprise Funds 911 Service Fund Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) 125 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual Operating revenues: Other $ 295,000 325,981 30,981 301,289 Operating expenses: Personnel services 1,500 1,500 — 1,500 General and administration 300 332 (32) 277 Telephone services 293,200 324,202 (31,002) 299,459 Total operating expenses 295,000 326,034 (31,034) 301,236 Operating income (loss) $ — (53) (53) 53 Net position, at beginning of year 53 Net position, at end of year $ — 53 125 r F F r I I L L L KODIAK ISLAND BOROUGH Enterprise Funds Research Court Apartments Schedule of Revenues, Expenses, and Changes in Net Position Budget and Actual Year ended June 30, 2023 (With financial information for the year ended June 30, 2022) Operating revenues: Lease income Other Total operating revenues Operating expenses: Personnel services Maintenance and repairs Depreciation General and administration: Support goods and services Contracted services Heating Electrical Plumbing Miscellaneous Total operating expenses Operating income (loss) Other income (expense): Intergovernmental: State of Alaska on -behalf payment Investment income (loss) Total other income (expense) Change in net position Net position, at beginning of year Net position, at end of year L 126 2023 Variance with Final Budget Final Positive 2022 Budget Actual (Negative) Actual $ 91,200 94,755 3,555 85,518 200 91,200 94,755 3,555 85,718 15,939 6,093 9,846 7,835 17,500 659 16,841 - 34,067 34,067 - 34,067 5,200 (106) 5,306 4,020 15,000 5,793 9,207 3,726 10,000 12,785 (2,785) 12,579 8,000 5,402 2,598 5,709 13,000 8,836 4,164 8,436 - 5,362 (5,362) 6,209 118,706 78,891 39,815 82,581 (27,506) 15,864 43,370 3,137 220 - (220) - 2,027 2,027 (4,149) 220 2,027 1,807 (4,149) $ (27,286) 17,891 45,177 (1,012) 307,536 308,548 $ 325,427 307,536 L 126 m m m LJ L I' (This page was left blank intentionally.) o I 1 ji 1 11 J 1 1 f SUPPLEMENTARY SCHEDULES r rKODIAK ISLAND BOROUGH rSUMMARY OF BONDED DEBT SERVICE REQUIREMENTS TO MATURITY June 30, 2023 I l_ L L R 127 f Annual principal and interest requirements on General Obligation Bonds. Fiscal Year Principal Interest Total 2024 $ 6,240,000 $ 1,322,359 $ 7,562,359 2025 6,420,000 1,138,811 7,558,811 2026 5,230,000 959,870 6,189,870 2027 4,450,000 828,058 5,278,058 r2028 4,565,000 707,672 5,272,672 t 2029 4,060,000 589,902 4,649,902 r 2030 4,115,000 478,830 4,593,830 I 2031 4,230,000 362,743 4,592,743 2032 3,545,000 259,950 3,804,950 2033 3,635,000 168,674 3,803,674 l l 2034 2,175,000 89,417 2,264,417 2035 580,000 43,323 623,323 2036 610,000 14,713 624,713 $ 49,855,000 S 6,964.322 $ 56,819,322 I l_ L L R 127 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2021 Series One RETIREMENT SCHEDULE June 30, 2023 The 2021 Series One General Obligation School Bonds were issued to refund (refinance) the 2011 Series One General Obligation School Bonds that 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. Refunding bond - 2021 Series One 128 Interest due Principal due Interest due Fiscal year Interest rate December 01 December 01 June 01 Total 2024 5.00% $ 85,000 $ 355,000 $ 76,125 $ 516,125 2025 5.00% 76,125 375,000 66,750 517,875 2026 5.00% 66,750 395,000 56,875 518,625 2027 5.00% 56,875 410,000 46,625 513,500 2028 5.00% 46,625 430,000 35,875 512,500 2029 5.00% 35,875 450,000 24,625 510,500 2030 5.00% 24,625 480,000 12,625 517,250 2031 5.00% 12,625 505,000 - 517,625 $ 404,500 $ 3,400,000 $ 319,500 $ 4,124,000 128 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2021 Series Two RETIREMENT SCHEDULE June 30, 2023 The 2021 Series Two General Obligation School Bonds were issued to refund (refinance) the 2012 Series A and B General Obligation School Bonds that were issued to refund (refinance) the 2004 Series C and D 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. Refunding bond - 2021 Series Two Interest Due Principal Due Interest due Fiscal Year Interest Rate December 01 December 01 June 01 Total 2024 0.44% $ 7,822 $ 1,365,000 $ 4,799 $ 1,377,621 2025 0.70% 4,799 1,375,000 - 1,379,799 $ 12,621 $ 2,740,000 $ 4,799 $ 2,757,420 129 1 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2021 Series Three RETIREMENT SCHEDULE June 30, 2023 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 2013 Renovation. These bonds were refunded (refinanced) in 2021 and are reported as the 2021 Series Three Bonds. Refunding bond - 2021 Series Three 130 Interest Due Principal Due Interest due Fiscal Year Interest Rate December 01 December 01 June 01 Total 2024 0.44% $ 106,337 $ 1,325,000 $ 103,402 $ 1,534,739 2025 0.70% 103,402 1,330,000 98,760 1,532,162 2026 1.03% 98,760 1,340,000 91,846 1,530,606 2027 1.18% 91,846 1,355,000 83,838 1,530,684 2028 1.53% 83,838 1,375,000 73,312 1,532,150 2029 1.73% 73,312 1,400,000 61,195 1,534,507 2030 1.97% 61,195 1,420,000 47,194 1,528,389 2031 2.02% 47,194 1,450,000 32,534 1,529,728 2032 2.12% 32,534 1,480,000 16,832 1,529,366 2033 2.22% 16,832 1,515,000 - 1,531,832 $ 715,250 $ 13,990,000 $ 608.913 $ 15,314,163 130 r KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2014 Series One / 2021 Series Four RETIREMENT SCHEDULE June 30, 2023 i 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. These bonds were refunded (refinanced) in 2021 and are reported as the 2021 Series Four Bonds. rUnrefunded Portion - 2014 Series One I Interest Fiscal Year Rate 2024 5.00% 2025 3.13% Refunding bond - 2021 Series Four Fiscal Year 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Interest Rate 0.44% 0.70% 1.03% 1.18% 1.53% 1.73% 1.97% 2.02% 2.12% 2.22% 2.35% Interest Due September 01 $ 43,844 17,344 $ 61,188 Interest Due December 01 $ 124,182 123,628 122,756 115,480 107,088 96,065 83,385 68,694 53,327 36,775 19,110 $ 950,490 Principal Due Interest Due March 01 March 01 $ 1,060,000 1,110,000 $ 2,170.000 Principal Due December 01 $ 250,000 250,000 1,410,000 1,420,000 1,440,000 1,465,000 1,490,000 1,520,000 1,560,000 1,590,000 1,625,000 $ 14,020,000 L 131 $ 43,844 17,344 $ 61,188 Interest Due June 01 $ 123,628 122,756 115,480 107,088 96,065 83,385 68,694 53,327 36,775 19,110 $ 826.308 Total $ 1,147,688 1,144,688 $ 2,292,376 Total $ 497,810 496,384 1,648,236 1,642,568 1,643,153 1,644,450 1,642,079 1,642,021 1,650,102 1,645,885 1,644,110 $ 15,796,798 IR11 TJ Wq 1.11"0 t711111"T611144 41 GENERAL OBLIGATION BONDS 2015 Series Three RETIREMENT SCHEDULE June 30, 2023 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. Fiscal Year 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Interest Rate 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 4.00% 5.25% 5.25% 5.25% 5.25% 5.25% Interest Due October 01 $ 117,856 111,231 104,356 97,106 89,481 81,481 73,106 64,231 56,831 46,594 35,831 24,544 12,600 $ 915,248 Principal Due October 01 $ 265,000 275,000 290,000 305,000 320,000 335,000 355,000 370,000 390,000 410,000 430,000 455,000 480,000 $ 4,680,000 132 Interest Due April 01 $ 111,231 104,356 97,106 89,481 81,481 73,106 64,231 56,831 46,594 35,831 24,544 12,600 $ 797,392 Total $ 494,087 490,587 491,462 491,587 490,962 489,587 492,337 491,062 493,425 492,425 490,375 492,144 492,600 $ 6,392,640 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2015 Series Three RETIREMENT SCHEDULE June 30, 2023 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. 133 Interest Interest Due Principal Due Interest Due Fiscal Year Rate October 01 October 01 April 01 Total 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 $ 32,000 $ 630,000 $ 16,250 $ 678,250 133 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2016 Series One RETIREMENT SCHEDULE June 30, 2023 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. 134 Interest Interest Due Principal Due Interest Due Fiscal Year Rate August 01 August 01 February 01 Total 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 $ 167,881 $ 1,405,000 $ 143,547 $ 1,716,428 134 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2016 Series One RETIREMENT SCHEDULE June 30, 2023 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. 135 Interest Interest Due Principal Due Interest Due Fiscal Year Rate August 01 August 01 February 01 Total 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 $ 95,875 $ 1,885,000 $ 48,750 $ 2,029,625 135 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2016 Series Three RETIREMENT SCHEDULE June 30, 2023 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. Interest Interest Due Principal Due Interest Due 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 $ 212,750 $ 2,745,000 $ 144,125 $ 3,101,875 136 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2018 Series A RETIREMENT SCHEDULE June 30, 2023 The 2018 Series A 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. Interest Interest Due Principal Due Interest Due Fiscal Year Rate December 01 December 01 June 01 Total LVL% J.Vviu a J,i%% a »,VVV 2025 5.00% 4,352 55,000 2026 5.00% 3,546 55,000 2027 5.00% 2,727 60,000 2028 5.00% 1,824 60,000 2029 5.00% 915 60,000 $ 18.508 S 345.000 137 $ 4,352 $ 64,496 3,546 62,898 2,727 61,273 1,824 64,551 915 62,739 - 60,915 $ 13,364 $ 376,872 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2020 Series One A RETIREMENT SCHEDULE June 30, 2023 The 2020 Series One A 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. Interest Interest Due Principal Due Interest Due Fiscal Year Rate December 01 December 01 June 01 Total 2024 5.00% $ 7,250 $ 30,000 $ 6,500 $ 43,750 2025 5.00% 6,500 30,000 5,750 42,250 2026 5.00% 5,750 35,000 4,875 45,625 2027 5.00% 4,875 35,000 4,000 43,875 2028 5.00% 4,000 35,000 3,125 42,125 2029 5.00% 3,125 40,000 2,125 45,250 2030 5.00% 2,125 40,000 1,125 43,250 2031 5.00% 1,125 45,000 - 46,125 $ 34,750 $ 290,000 $ 27,500 $ 352,250 138 KODIAK ISLAND BOROUGH GENERAL OBLIGATION BONDS 2020 Series One B RETIREMENT SCHEDULE June 30, 2023 The 2020 Series One B 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. Interest Interest Due Principal Due Interest Due Fiscal Year Rate December 01 December 01 June 01 Total 2024 5.00% $ 38,875 $ 160,000 $ 34,875 $ 233,750 2025 5.00% 34,875 170,000 30,625 235,500 2026 5.00% 30,625 180,000 26,125 236,750 2027 5.00% 26,125 190,000 21,375 237,500 2028 5.00% 21,375 200,000 16,375 237,750 2029 5.00% 16,375 205,000 11,250 232,625 2030 5.00% 11,250 220,000 5,750 237,000 2031 5.00% 5,750 230,000 - 235,750 $ 185,250 $ 1,555,000 5 146.375 5 1,886.625 139 I I I It, I_* C (This page was left blank intentionally.) a 1 f !J 1 I f I I Lel I 11 STATISTICAL SECTION r I r I I I I L L L STATISTICAL SECTION This part of the Kodiak Island Borough's annual comprehensive 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. 140-144 Revenue Capacity These schedules contain information to help the reader assess the government's most significant local revenue source, the property tax. 145-148 Debt Capacity These schedules present information to help the reader assess the affordability of the government's current levels of outstanding debt and the gov ernment's ability to issue additional debt in the future. 149-153 Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the government's financial activities take place. 154-160 Sources: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports Lfor the relevant year. L L L I r I I C L L L L L L fq W HM W W fA ll� II �I �fl m r�I II I � � I C;kl N II 'P1 ori fq W HM W W fA ll� II �I �fl m r�I II I fq W HM W W fA m r�I II I � � I fq W HM W W fA E.penses nlotties: General govommm, Pebbcsafen Communis5 ad ecommric des'elopmea0 Emergen-prepardness HeaOh ad sand welfare Educatio, culture. andrarcatian Parks and recreation Sen ce mstiim malnmonme Primanand moon loo education Interest on long-term dein Tonal gos'emmenml ann'ma expenses Busiea,ty, eamis'ntes. Municipal solid%ane collection and disposal Hmpi rl facilities Long Term Care Center Kodiak Fainno s Research Censer 911 smices Research Caen Apamnems Total bosiness , a tivitia expenses Taal pronati' am, emmem expones Program m imdmm mtia Gmities: Charger for sen'ices: Goenoal govemmcm Public mfat5 Sen'im dim e, maiden. Operating grams and rosenbutimu Capital grams Total eoscmmemal activities progam resanues Businas-npc arti5itio,. Charges for am ices Municipal solid e, ane collation and disposal Hospital facilities Lang Team Care Ccnmr Kdiak FisMna Rexarch Center Research C. Apache Operating grams and contributions Capital gams Total business -rape amisitim pmgam.,era. I Changes in Nes Position Lass Ten Fiscal Years (aamal basis of aaomting) 344 015 2016 2017 3018 2019 2020 2021 2022 2023 a E 6.990610 5 5637.239 E 7,850,988 S ),156,08) S 6.692530 S 5.209.588 S 5.548,287 5 5.367.775 S 5.348834 $ 3799,341 32.6,19 )5163) 663.145 )98.0]9 1.028.240 1,236,992 936,083 696.481 690.853 710,205 471,934 11.326 9"377 886.613 1.16).36) 1.136.303 1.152.197 1.133.265 782053 779.758 8]].503 )]5.952 576,,930 17487 31628 X11,19 35.861 43,039 14307 4479 5157 10.983 16460 326.700 406.093 389.000 233.999 207.5110 192.900 157,500 5.257.005 169.64) 150.000 a 218.013 335.854 2.996.001 17.562 4.665 )0.4)2 5790959 20.397 20.3% 20.562 37.795 161596 87.456 30.02 77.186 43.369 32.561 19,560 22.125 12.)60 631572 534376 626.289 175.248 587.707 645.533 ]86.3)9 647.976 856.657 700146 14.523.509 14.316.695 11.225.@2 14.162.868 12695.233 13219790 10.522515 15.137.9" 16.007,893 17.883.044 2.109406 3063."9 3.194.612 3060.520 2.673.238 2500.440 2.346.340 1 70)93 751860 924391 26.566.136 26.036.888 28.365666 27,334.860 25.390.286 23955.746 26.667.554 29631338 24.776.103 24.954.592 2.080.g" 2.468.058 4)648]1 3296.817 3.245526 3.287.702 2.795669 3741080 3.373.120 2.830.]9) 040.525 1)63.636 2056690 1.294657 1.412.150 1201971 1.302.517 10))905 1.115337 1.374719 - - - 1.126.059 1.008032 960.008 946.018 1.247.226 670.592 561.395 1.681.111 1486.620 1.555.116 1.532.010 1.422337 1571643 1.369.009 1237.187 1.281.996 1.351.889 39817 33.961 30.417 28,409 25560 300.OW 336226 301.032 301.236 326.034 a S 6,990,549 f - - - - - 3.195933 S 77.483 92.581 78.891 5542312 5.)52.2)5 8409.094 ).269.952 ---T-4] 662 ].321 364 6.)49.439 ).681.913 6.825,262 6.526 ]25 32.108453 31.)89.163 36.774760 34606.812 32733948 31.2)7.130 33.416.993 37.313.251 31.601.365 31.181,317 $ 577,350 $ 510.052 $ 4826" $ 2.8]4]94 $ 873.043 S 966.852 $ 1006.734 5 942701 $ 901.717 $ 905435 14314 13.601 16361 14716 14701 8734 18.65) 16420 L25 110313 4077530 114516 4.305,691 66.161 4.813,838 111.146 4.226913 NA50 90.450 5614,105 8600 5.611454 22600 2577,821 226110 479124 27400 14585485 233 27.600 7.00 5.819.357 6451)3] 3,002933 3236,270 885.493 346427 294,899 137.918 625925 140.172 /9]6,]93 1143124 ). 8.795.543 8.113.042 6689.6628%(62 4.969.334 3915655 1.406000 16157.1311 6.927.889 2.265,967 2,611,854 2.859,436 3.105.560 3.813.343 4.465.387 4.151.619 4.061.66 4.161275 4.120050 a 1.1500" 1.759,769 1.959.827 "O.Ow 1.384,272 1.384.272 1.384.272 1.384272 1.505.101 1451.382 1.119 929 1093475 1043.628 1, W 3 628 1043 626 1370.640 1.199.6,14 1831.322 2,267.032 3.353.711 847."2 818.138 820.1" 787.296 499.485 950.570 927.289 - - - - - - - 70261 15.518 94.755 - 32.6,19 428.578 2])99 44509 27.630 (20490) 31.959 (37901) (28.253) 5.538.038 213,753 11.326 - - - - 3414.671 4.65.899 3371650 10805.327 08Ni077 8.612.885 576,,930 ].153.)3) 774108) 7395885 ).111206 8.035900 ),746.86) 12.140 HLI18 4791 5.448 1.106217 1.106317 604.274 271,691 281.855 Total pitman gm crossed pmgam revenues 5 22.236.573 $ 14861870 S 17.408428 5 13973992 S 13.843399 S 14710418 $ 11311.540 5 8717108 5 24.193.050 S 14692756 NeOcxpcmeUrevenue: 17.449.358 S 0.607487 S 18.130369 1843.819 Ciooemmemal activities S (15A,IA90) S 1180 6 00 95) S (19.570123) $ (19223.)98) 5 118300624) $ (18300624) $ (22J51.899) S (28025,338) $ (8618.953) $ (18.026.703) 1100.413 Bnsiress-rape activities 5.263.010 1.132.802 203.791 (1509022) (189925) (189,925) "6.446 (570.705) 1.210.08 1.238.142 - Total p-angmenmmm net npense S (9871,880) $ 11(S,92],293) $ (19.3".332) S (20732,82015 (18.890.549) S (18890549) S (22,105453) S (28.596.043) $ (7 08315) S (16788561) 4.142583 4.142.583 27.683 3.631.012 General Revenues and Other Changes in Net Assets Go, -.is] awn A. Ts,es Propem, lazes Sarerancc tae. TObacto ncoe taco, U..,W gams and eoarrilear.s ).and mala Ins'6tmcnl r 1.1 Oder Transfers Tramfcrs Componcm Unit E.mardinan imm Total gasnmmcmal scovaia Basinas-rape seti5'inies I.... in, ONea Transfers EsOamdinan item Total boodson-rape axle hies Total prams, gommmen, (Ohmar in Net Position Gosermnmtal at,...nes Business-. p, ar.o,ties Trail priman'gm'emmmt S 13341.190 $ 1334/1911 S 14A14032 S 15.714.593 $ 16."5.148 S 16640.329 $ 17228.428 S 17.449.358 S 0.607487 S 18.130369 1843.819 1.843819 3,985.978 1.414.557 1.929.409 1.285.669 1.286250 1100.413 1.779."2 1.719.343 - - - - 310,182 425.414 389.]25 702.142 683.971 829.274 4.142583 4.142.583 27.683 3.631.012 3414.671 4.65.899 3371650 8347.105 3.167223 3.892.080 864.584 8".584 1586.555 325.793 27.955 19.002 12.140 HLI18 4791 5.448 1.106217 1.106317 604.274 271,691 281.855 2.196169 145449 188577 (2822.026) 951.821 506.546 506.46 403.958 23.306 305,983 11],2)8 470,560 354.W8 534.249 741.366 (80.000) (800001 (50228) (1.134372) (45000) (45000) (45.000) - - - - - - - - - 1632815 - - - 75.246 I 22.125.439 5 22.125.439 S 216,17.498 S 20.246.580 S 22270503 S 24.924.790 5 2580120 S 28.551261 S 20.955.237 S 26.269.701 178.851 178.851 236,190 07.951 69.871 622,256 443602 38.817 (936.242) 126.482 598.162 598.162 203.764 115.556 320.774 375,891 592.188 428,009 317.012 392.860 80000 80.000 50,228 1.134,373 45.000 45.000 45.000 - - - (54.590) 857.013 857013 490.02 1.373.189 435.6,15 1603.147 1)807" 466.826 (519.230) 519.342 S 22.982.452 S 22982452 S 22.13].6]0 E 21.619.769 f 22206.148 5 25.967937 S 26.882.007 $ 29.018.587 S 20.436.007 S 26789."3 0 S 6,990,549 f 40653)) S 2,077.375 E 1,022.782 S 3.569.879 S ),9383]8 I 3.195933 S 526,423 f 12.336.284 3 8.241998 6.120.023 1989615 693.963 (135.833) 245220 1.462.577 1227236 (103.879) 691.408 057.484 S 13.110.72 $ 6055.159 5 2)]1338 5 886.949 S 3815.599 $ 9.400.955 $ 4923.169 $ 422544 $ 13.OVA92 $ 100010482 C I 141 0 r rKODIAK ISLAND BOROUGH L L L L L 142 L Fund Balances of Governmental Funds Last Ten Fiscal Years r (modified accrual basis of accounting) General Fund: 2014 2015 2016 2017 2018 Nonspendable $ 1,459 $ 14,566 $ 26,272 $ 32,349 $ 37,885 Unassigned 3,502.489 3,181.342 3,259,509 2.284.775 3.151,059 rTotal General Fund $ 3,503.948 $ 3,195.908 $ 3,285,781 $ 2317.124 $ 3.188.944 All other governmental funds Nonspendable $ 513,765 $ 287,564 $ 181,191 $ 419,212 $ 4 Restricted Committed 42,355,129 42,606,097 43,081,680 4,502,105 43,846,363 Assigned 28,875,499 7,610,272 11,312,217 3,073,997 5,411,992 r Unassigned (2,929,481) (2,516,222) (1,871,193) (122,678) (126,614) ,l Total all other governmental funds $ 68,814,912 $ 47,987,711 $ 52,703,895 $ 7,872,636 $ 49,131,745 2019 2020 2021 2022 2023 General Fund: Nonspendable $ 37,885 $ 57,926 $ 33,149 $ 45,790 $ 120,671 Unassigned 3,151,069 6,120,644 7,454,071 8,205,029 17,430,159 Total General Fund $ 3,188,954 $ 6,178,570 $ 7,487220 $ 8250,819 $ 17.550.830 All other governmental funds Nonspendable $ 1,311 $ $ $ 6,048 $ 1,745 Restricted _ 153,535 47,010 54,247 Committed 45,862,404 46,186,064 46,360,958 54,580,464 45,928,606 Assigned 5,899,049 7,393,442 6,828,331 8,650,120 12,966,368 Unassigned (877,704) (926,989) - (158,417) (193,133) k( 1. Total all other govemmental funds $ 50.885.060 $ 52.652,517 $ 53,342,824 $ 63,125,225 $ 58.757.833 L L L L L 142 L KODIAK ISLAND BOROUGH Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis ofaccoumin8) Expenditures: Raul Year General government 2014 2015 2016 2017 2018 2019 2020 2021 202E 2023 Revenues: 576.720 524,169 572.839 699,118 2,001,538 714.826 635.865 546,055 543,862 725,305 Property Wu and assessments E 13.656,771 14.091,503 14.310.687 15.700,272 16.002,138 16.794,958 16.978,918 17,465,902 17,655,437 18.121,497 Transient accommodations tax 75,142 104074 95,466 108,050 113,486 78.971 62.829 50.983 101,447 122.016 low,ovennmental. 326,7W 406.093 389,000 233,999 207,500 182,900 157.500 5,257,005 169,647 150,000 Some sources 12,938,158 10,332.739 8,870,802 6.134,338 6,975,473 8.128.643 4,378,515 1,914,694 16.158,378 7,842.443 Federal sources 1,933,672 2,093,987 3.09.533 2,628,537 2,067,113 2.147,572 2,387,270 7,522,174 2.485,648 2,124.729 Severance taxes 1,843,819 1,703,257 1±91.099 1306,507 1,815.923 1106,698 1,223,921 1,049,430 1,677,595 1.597,327 Tobacco excise banes - - - - 310,482 425,444 389,725 702,142 683,971 829,274 Licenses, permits, fees, and other local revenues 701999 688,719 774,225 3.014,816 992,759 1,023.153 1,057,335 1002.408 945,737 968,160 Other revenues 50,556 17,747 45.422 9,146 290,343 95.463 533,239 340.598 534,249 730,209 Investment ..in, 1.115.465 183.677 648,987 271,691 281.855 2,196,169 1054,149 188,577 (2.822.026) 951.821 Total revenues 32,315,583 29,615703 29,327,211 29,173,357 28,849,572 32,097,071 28,465,701 30,236,908 37,420,436 33,287,476 Expenditures: General government 5,449,505 6,333,724 5.307.245 5.281999 5,715,946 5,308.369 5,197,783 4,995,157 5,017,074 5.062,574 Public safety 576.720 524,169 572.839 699,118 2,001,538 714.826 635.865 546,055 543,862 725,305 Community and economic development 964,377 1,153.985 1.069,639 1,096,928 1,177,198 1,183,798 885,179 907,656 962.935 944,084 Emergency preparedness 9,987 29.128 30.849 35,861 43,038 14.307 4.479 5,257 10,983 16,460 Health and soaal welfare 326,7W 406.093 389,000 233,999 207,500 182,900 157.500 5,257,005 169,647 150,000 Education, culture, and recreation 95625 24,856 23,949 17,562 4665 20,472 20,447 20,397 20,3% 20,562 Parks and recreation 37,795 161,596 87,456 30,172 77,186 57,096 32,561 19,560 22,125 12,760 Service district maintenance 631.572 534,376 626,289 475,248 587.707 569,610 786,366 647,976 856,657 700,146 Primary and secondary education 10,845,220 11.100.714 11,100,650 10,373,548 9,449,500 9,970.576 10,522,544 9,443,364 10,521.511 12.035,259 Capital outlay: Schools 34,872,235 21,984,655 13,240,920 3936,147 2,958,053 2,092,006 555,253 367,008 137,568 461,278 General 1,521 996 2.907,018 3,430,975 1,086,817 826.432 991,403 1,049,466 803,272 516,580 686,810 Community Development - - - - - - - 25,540 551,514 - Debt service. Principal 3,645,950 2,646.040 3,201,002 3,530,000 1,870,000 4,425,000 4.655.000 4,850,000 5,840,W0 6,035,000 Interest 2,109,406 3,121,577 3,194.612 3,568,559 3.408,310 3,253,414 3,078,394 2,986,372 1719,024 1,531,316 Mer charges- bond issuance costs 99,835 - 124,372 64,313 - 10,0W - 251851 - - Tocol apenditures 61176923 50.927.931 42,399,792 30,430,271 30,327,073 28,793.777 27.580,837 31,126,470 26,889,876 28,381,554 Excess of revenues over(under) expenditures (281861.340) (21,312,228) (13,072,586) (1,256.914) (1,422,501) 3,303.294 884.864 (889,562) 10,530.560 4,905,922 Other Financing Scene. (Us.): Proceeds from sales of bonds 22660,000 - 18,000,000 4,905.000 - 550"000 - 2044(69 - - Bond premium 2.427.432 - 2,141,115 80,205 - - - 857,176 - - Refunding bonds issued - - - - - - - 37,350,000 - - Payment orounded bond escrow agent - - - (5.934,301) - - - (37,981,510) - - Bond refunding issuance ..at - - - - - - - - - - Proceeds hour sale ofassets - - - 140,000 1,240 9,815 - - - 11.152 Land sale proceeds 356,284 329,344 110.428 145.820 224,902 76,676 28,903 62,805 15,440 15,540 Insumnce proceeds - - 403.958 - - - - - - - TransfnSin 992,365 642,691 1,404,497 1758,036 1,189,104 1786,712 1,628.191 5.700.165 4,290,585 12,444981 Transfers out (1,072365) (795,048) (1,454725) (2,892,408) (1134.104) (1,831,712) (1,673,191) (5,7W,165) (4,29.585) (12,444981) Transfersm- Componemumt - - - - - - 1632,815 - - - Tomlother financing soumaguses) 25,363,716 176,987 17,605.273 (1,071,648) 181,142 591.491 1,616,718 2.972,540 15,440 26,697 Net change in fund balances 8 (3±92,624 (21,135,241) 4532.682 12328.5621 11,29 ,359) 3,894.785 2501582 2,082,978 10.546,000 4932619 Debt serviceas a percentage ofnonapdal expenditures 22.51 % 21.71 % 23.80% 2684 % 2809% 30.20% 2924% 26.23% 28.82% 28.32% 143 o ma© c� o 0 o ca cam 0 0 0 0 0� a o 0 0 r I KODIAK ISLAND BOROUGH General Revenues by Source") Last Ten Fiscal Years (a)Includes General Fund only. ISource: Borough general ledger. 11 L L L L L L 144 Licenses, Inter - Fiscal Permits Governmental Investment Operating Miscellaneous Year Taxes and Fees Revenue Income Transfers Revenue Total 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 2019 3,551,740 130,441 4,403,041 211,630 — 15,210 8,312,062 2020 2,666,644 96,415 3,523,307 152,804 — 39,860 6,479,030 2021 6,045,254 75,790 8,931,861 24,496 — 8,743 15,086,144 2022 5,810,140 62,975 3,327,965 (371,295) — 1,616 8,831,401 2023 4,478,369 76,164 3,943,757 422,783 — 11,193 8,932,266 (a)Includes General Fund only. ISource: Borough general ledger. 11 L L L L L L 144 KODIAK ISLAND BOROUGH Assessed and Estimated Actual Value of Taxable Property Last Ten Fiscal Years $1,600,000,000 $1,400,000,000 $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,00p,000 $200,000,000 $o 2014 Last Ten Years Assessed Values 2015 2016 2017 2018 2019 2020 2021 2022 2023 145 Ratio of Total Taxable Total Assessed to Fiscal Real Property Pers anal Property Total Direct Total Year Ended Net Taxable Full Value Net Taxable Full Value Net Taxable Full Value Tax Full Value 3une30, Assessed Value Determination Assessed Value Determination Assessed Value Delernrtnation Rate Determination 2014 1,029,239,311 1,100,702,180 102,237,300 286,425,000 1,131476,611 1,387,127,180 1075 81'58 2015 1,068,647,102 1,137,024,180 113,251,900 361,886,700 1,181 899,002 1,498,910,880 1075 78 8' 2016 1084,317,572 1,161805,872 118,559,600 348,158,100 1,202,877,172 1,509,963,972 10.75 7961 2017 1,169,223,198 1,256,477,176 143,116,200 154,899,290 1312,339,398 1,411,376,466 1075 929E 2018 1205,698,799 1,29,502,977 137,125,100 149,533,000 1,342,823,899 1440,035,977 1075 932- 2019 1,220,528,925 1 344,742,803 139,440,700 152,390,588 1,359,969,625 1,497,133,391 10 75 90 8, 2020 1,266,365,775 1,363,039,653 155,178,500 168,465,300 1,421,544275 1,531,504,953 10.75 92.8: 2021 1298,329,669 1,39,457,617 157,498,073 168,586,400 1,455,827,742 1559,044,047 1075 93.3E 2022 1,341595,132 1437,926,510 153,152,089 164,741,900 1,494,747,221 1,602,668,410 1075 93 T 2023 1,356,823,091 1463,573,169 159,819.657 172,562.100 1,516,642,748 1,636,135,269 10.75 92]( 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 $ 1,0110 of assessed value. $1,600,000,000 $1,400,000,000 $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,00p,000 $200,000,000 $o 2014 Last Ten Years Assessed Values 2015 2016 2017 2018 2019 2020 2021 2022 2023 145 KODIAK ISLAND BOROUGH Direct and Overlapping Property Tax Rates and Contributions to the School District (per SI,000 of Assessed Value) Last Ten Fiscal Years Note: With the exception of a mill rate to cover Debt Service. the maximum mill rate allowed by State code is 30 mills ' Overlapping rates are those of local governments that apply to property ownerswithin the City of Kodiak. ' Overlapping rates are those which apply to property owners located within special taxing districts in the borough. They do not apply to every property owner m the Borough. IEM Direct Rate Overlapping Rates Woodland' Trinity' Mission' Fiscal Acres Islands Lake Fire Areas' Year Borough Education Renewal City' Street Street Tide Road Services Areas' Fire Ended Basic Support Debt and of Lighting Lighting Gate Monaahka Service Bay View Winners Protection Womens June 30, Rate Fund Service Replacement Kodiak Area Area Area Bay District 1 Road Bay Area No. 1 Bay Airport 2014 0.03 875 1.81 0,16 2.00 0.25 0.50 1,00 2.50 0.50 1.75 2.50 1.50 1.25 1.25 2015 0.06 9.16 0.99 0.54 2.00 0.25 0.50 1.00 250 1.50 1.75 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 1.07 100 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 1.30 100 0.10 0.20 1.00 2.50 1.50 1.50 2.50 1.50 1.25 1.25 2019 1.10 7.05 1.87 0.73 2.00 0.10 0.15 0.25 2.50 1.50 1.50 2.50 1.50 1.25 1.25 2020 0.56 7.45 1.79 0.95 100 0.10 0.15 0.25 2.50 1.50 1.50 2.50 1.50 1.25 1.25 2021 2.75 6.45 1.55 - 2.00 0.10 0.15 0.25 1.99 1.50 1.47 2.50 1.50 1.25 1.25 2022 2.11 6.99 1.65 - 2,00 0.10 0.15 0.25 1.99 1.50 1.47 2.50 1.50 1.25 1.25 2023 1.18 7.88 1.36 0.33 2.00 0.10 0.15 0.25 1.99 1.50 1.47 2.50 1.50 1.25 1.25 Note: With the exception of a mill rate to cover Debt Service. the maximum mill rate allowed by State code is 30 mills ' Overlapping rates are those of local governments that apply to property ownerswithin the City of Kodiak. ' Overlapping rates are those which apply to property owners located within special taxing districts in the borough. They do not apply to every property owner m the Borough. IEM KODIAK ISLAND BOROUGH Properly Tax Levies and Collections Last Ten Fiscal Years (a , , , , Source: Borough general ledger. (a) Assessed taxable values as reported in this schedule are prior to any adjustments made for the levied tax year. 147 Collected within the Fiscal Year Taxes Levied Fiscal Year of the Levy Collections Total Collections to Date Ended for the Percentage in Subsequent Percentage June 30, Fiscal Year Amount of Levy Years Amount of Levy 2014 $ 14,424,260 $ 14,250,305 98.8 $ 169,805 $ 14,420,110 100.0 2015 15,009,704 14,749,222 98.3 254,797 15,004,019 100.0 2016 15,261,029 15,032,113 98.5 215,814 15,247,927 99.9 2017 16,642,674 16,554,392 99.5 73,780 16,628,172 99.9 2018 17,069,728 16,809,461 98.5 241,983 17,051,444 99.9 2019 17,699,787 17,462,634 98.7 212,958 17,675,592 99.9 2020 18,055,528 17,809,122 98.6 215,443 18,024,565 99.8 2021 18,431,128 18,243,706 99.0 152,905 18,396,611 99.8 2022 (a) 18,909,337 18,915,116 100.0 (140,339) 18,774,777 99.3 2023) $ 19 173 229 $ 19 137 935 998 $ $ — (a , , , , Source: Borough general ledger. (a) Assessed taxable values as reported in this schedule are prior to any adjustments made for the levied tax year. 147 KODIAK ISLAND BOROUGH Principal Property Tax Payers Current Year and Ten Years Ago I 2023 Taxable of Total Borough Assessed Percentage Assessed Taxable Rank of Total Borough $ 32,091,700 Assessed 2.7% Assessed Taxpayer Value Rank Value Trident Seafoods Corp $ 76,764,800 1 5.1% Matson Navigation 47,855,100 2 3.2% Ocean Beauty Seafoods 34,754,302 3 2.3% Silver Bay Seafoods 23,817,700 4 1.6% North Pacific Seafoods 15,093,500 5 1.0% Mill Bay Plaza Assoc Ltd 12366,600 6 0.8% Island Holdings LLC 12,067,800 7 0.8% Oceanfront Kodiak LLC 11,899,000 8 0.8% Wal-Mart / Sam's Club 11,793,900 9 0.8% Kodiak Area Native Association 10,985,864 10 0.7% Int'I Seafoods of Alaska GCI Holdings LLC Leisnoi Inc Island Fish Co. LLC Alaska Communications Systems Total $ 257.798.566 17.0% Source: Borough tax records. 1 148 2014 Percentage Taxable of Total Borough Assessed Assessed Value Rank Value $ 32,091,700 1 2.7% 7,809,800 7 0.7% 28,438,600 2 2.4% 13,893,400 4 1.2% 10,921,500 5 0.9% 9,494,400 6 0.8% 17,333,000 3 1.5% 7,804,500 8 0.7% 7,563,800 9 0.6% 6,445,600 10 0.5% $ 141.796300 12,0% KODIAK ISLAND BOROUGH Legal Debt Margin Information Last Ten Fiscal Years 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 2019 2020 2021 2022 2023 Taxable Assessed value $ 1,389,969,625 1,424,752,775 1,455,827,742 1,494,747,221 1,516,642,748 Plus exempt property 94,213,878 93,464,878 92,127,978 96,331,378 106,750,078 Total $ 1,484,183,503 1,518,217,653 1,547,955,720 1,591,078,599 1,623,392,826 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). 151 KODIAK ISLAND BOROUGH Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Fund Expenditures and Transfers Last Ten Fiscal Years (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. 152 Total General Ratio of Fund debt service Fiscal Interest Total debt expenditures to general year Principal (a) and fees service and transfers expenditures 2014 3,645,950 2,107,198 5,753,148 6,621,593 86.9 2015 2,646,040 3,120,449 5,766,489 7,497,680 76.9 2016 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 6,402,256 113.7 2019 4,425,000 3,263,414 7,688,414 6,287,584 122.3 2020 4,655,000 3,078,394 7,733,394 5,744,905 134.6 2021 4,850,000 2,986,372 7,836,372 13,693,473 57.2 2022 5,840,000 1,719,024 7,559,024 8,067,802 93.7 2023 6,035,000 1,531,316 7,566,316 5,511,527 137.3 (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. 152 KODIAK ISLAND BOROUGH Ratios of Outstanding Debt by Type Last Ten Fiscal Years Note: Detail regarding the Borough's outstanding debt can be found in the notes to the financial statements. * Information not available at report time. 153 Governmental Activities Business -type Activities General Total Percent of Fiscal Obligation Notes Revenue Notes Primary Personal Per Year Bands Payable Bonds Payable Government Income Capita 2014 76,227,556 37,042 18,703,498 10,206,895 105,174,991 13.98% 7,623 2015 73,131,566 31,002 17,984,677 9,908,184 101,055,429 12.51% 7,313 2016 76,481,657 — 15,531,184 20,160,175 112,173,016 13.88% 8,134 2017 82,302,899 — 16,437,616 14,576,980 113,317,495 13.84% 8,355 2018 77,748,492 — 15,649,919 13,806,965 107,205,376 12.56% 8,068 2019 73,189,089 — 13,016,950 14,750,846 100,956,885 11.70% 7,686 2020 67,849,686 — 12,196,935 13,911,774 93,958,395 10.76% 7,227 2021 65,140,020 — 11,473,825 13,042,701 89,656,546 10.08% 7,109 2022 58,575,062 — 9,775,000 12,173,628 80,523,690 8.84% 6,242 2023 51,966,107 — 8,840,000 11,431,885 72,237,992 * 5,630 Note: Detail regarding the Borough's outstanding debt can be found in the notes to the financial statements. * Information not available at report time. 153 r r r r I L L L 11 15,000 10,000 5,000 Borough Population and Student Count 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 ■ Population (a( ■ School Enrollment (b) 154 Percentage Unemployment Rate (c) 5.7 4.9 5.0 4.6 4.8 4.2 4.4 3.9 3.9 3.0 KODIAK ISLAND BOROUGH Demographic and Economic Statistics Last Ten Years Per Capita Calendar Personal Personal School Year Population (a) Income (c) Income (c) Enrollment (b) 2014 13,797 752,337,000 54,529 2,468 2015 13,819 807,817,000 58,457 2,446 2016 13,790 808,036,000 58,843 2,437 2017 13,563 818,860,000 60,891 2,386 2018 13,287 853,258,000 63,938 2,437 2019 13,136 862,827,000 66,382 2,395 2020 13,001 872,896,000 66,988 2,315 2021 12,611 889,288,000 69,546 2,297 2022 12,900 910,664,000 71,593 2,275 2023 12,832 * * 2,254 Sources: (a) State of Alaska, DCRA certified population. (b) Alaska Dept. of Education, Average Daily Membership by Fiscal Year at %%x%\\.ccclstate.akov'stats (c) Bureau of Economic Analysis haps:/hcoo.bea.eov * Information not available at report time. 15,000 10,000 5,000 Borough Population and Student Count 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 ■ Population (a( ■ School Enrollment (b) 154 Percentage Unemployment Rate (c) 5.7 4.9 5.0 4.6 4.8 4.2 4.4 3.9 3.9 3.0 KODIAK ISLAND BOROUGH MISCELLANEOUS STATISTICAL DATA Last Ten Fiscal Years Sources: Borough Departments, Kodiak Island Borough School District and City of Kodiak (a) The majority of Village Schools are grades K-12. (c) School distrist personnel figured include staffing from the General Fund and Grams (b) All non -teaching employees, (d) Alaska Dept. of Education E Early Development, Average District Enrollment. Www.eedetate aWstats 155 0 0 0 0 0 0 0 0 ci o 0 0 a©© mo o 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 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 26.1 26.1 26.1 26.1 26.1 26.1 26.1 26.1 26.1 26.1 Building permits: Permits issued 155 193 216 143 93 94 91 85 68 58 Value of buildings (thousands) 36,652 36,216 10,866 11,793 7,331 19,324 14,148 7,736 7,938 11,391 Fire Protection: Number of fire stations 2 2 2 2 2 2 2 2 2 2 Number of employees I I I 1 1 I I 1 I I 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) 224 224 224 224 224 224 224 224 224 224 Facilities: Number of playgrounds 16 16 16 16 16 16 16 16 16 16 Number of swimming pools I 1 1 1 I I I I 1 1 Public Education: Number of schools: Kodiak Area Elementary 4 4 4 4 4 4 4 4 4 4 Kodiak Area Middle School I 1 1 1 1 1 1 I I 1 Kodiak Area High School I 1 1 1 1 1 1 1 I 1 Village Schools (a) 7 7 7 7 7 7 7 7 7 7 Number of support personnel (b) 181 187 200 206 206 189 192 196 214 236 Number of teachers (c) 162 166 170 177 210 193 185 190 217 228 Number of students (d) 2,468 2,446 2,437 2,386 2,437 2,395 2,315 2,297 2,275 2,254 Number of Municipal Employees 48 45 43 44.5 45 41 38 37 39 38 Sources: Borough Departments, Kodiak Island Borough School District and City of Kodiak (a) The majority of Village Schools are grades K-12. (c) School distrist personnel figured include staffing from the General Fund and Grams (b) All non -teaching employees, (d) Alaska Dept. of Education E Early Development, Average District Enrollment. Www.eedetate aWstats 155 0 0 0 0 0 0 0 0 ci o 0 0 a©© mo o r �^^� KODIAK ISLAND BOROUGH Average Monthly Employment & Earnings Last Ten Fiscal Years r r�" r r r r Total Industries Private Ownership Total Government Private Goods -Producing Private Service -Providing Fiscal Year 2022 Average Fiscal Year 2014 Fiscal Year 2015 Fiscal Year 2016 Employment Average Average Average Average Average Average 4,504 Monthly Monthly Monthly Monthly Monthly Monthly Employment Earnings Employment Earnings Employment Earnings Total Industries 6,472 $ 3,575 6,524 $ 3,650 6,154 $ 3,292 Private Ownership 5,049 3,491 5,148 3,565 4,721 3,118 Total Government 1,423 3,875 1,377 3,966 1,433 3,867 Private Goods -Producing 2,219 3,831 2,268 3,832 2,012 2,766 Private Service -Providing 2,830 3,224 2,879 3,356 2,710 3,378 Fiscal Year 2018 Fiscal Year 2019 Fiscal Year 2020 Average Average Average Average Average Average Monthly Monthly Monthly Monthly Monthly Monthly Employment Earnings Employment Earnings Employment Earnings Total Industries 6,037 $ 3,585 5,967 $ 3,816 5,706 $ 3,887 Private Ownership 4,578 3,433 4,511 3,714 4,118 3,758 Total Government 1,460 4,060 1,455 4,134 1,588 4,222 Private Goods -Producing 1,636 3,067 1,637 3,651 1,524 3,665 Private Service -Providing 2,942 3,637 2,875 3,748 2,594 3,812 Total Industries Private Ownership Total Government Private Goods -Producing Private Service -Providing Fiscal Year 2022 Average Average Monthly Monthly Employment Earnings 5,548 $ 4,303 4,019 4,226 1.530 4,504 1,440 4,328 2,578 4,171 Fiscal Year 2023 Average Average Monthly Monthly Employment Earnings 5,433 $ 4,760 3,827 4,921 1,605 4,379 1,337 5,369 2,490 4,681 156 Fiscal Year 2017 Average Average Monthly Monthly Employment Earnings 6,294 $ 3,540 4,867 3,407 1,427 3,995 1,934 3,318 2,933 3,466 Fiscal Year 2021 Average Average Monthly Monthly Employment Earnings 5,369 $ 3,951 3,834 3,837 1,535 4,236 1,384 3,633 2,449 3,954 KODIAK ISLAND BOROUGH Property Value, Construction, and Bank Deposits Last Ten Fiscal Years Sources: Borough assessing records and City of Kodiak building department and FDIC 400,000,000 350,000,000 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 Deposits in local banks 252,999,000 239,000,000 245,354,000 243,973,000 233,000,000 229,000,000 260,885,000 389,000,000 398,847,000 392,639,000 Deposits in Kodiak Banks Property Value* Commercial Residential 386,480,100 788,418,800 Construction 800,640,400 452,535,972 Commercial Residential Fiscal No. of 859,606,088 No. of 864,185,415 year permits Value permits Value 935,153,787 2014 44 33,062,171 111 3,589,833 2015 61 31,146,134 141 5,644,907 2016 56 4,882,606 160 5,983,768 2017 13 4,599,616 130 7,193,534 2018 23 3,515,430 70 3,815,114 2019 20 7,270,037 73 12,082,486 2020 l8 3,854,671 73 10,294,257 2021 23 3,600,009 61 4,136,397 2022 12 2,220,683 56 5,717,888 2023 12 3,171,206 46 8,219,995 Sources: Borough assessing records and City of Kodiak building department and FDIC 400,000,000 350,000,000 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 Deposits in local banks 252,999,000 239,000,000 245,354,000 243,973,000 233,000,000 229,000,000 260,885,000 389,000,000 398,847,000 392,639,000 Deposits in Kodiak Banks Property Value* Commercial Residential 386,480,100 788,418,800 402,319,200 800,640,400 452,535,972 750,341,200 384,902,202 820,796,597 390,922,837 859,606,088 401,383,960 864,185,415 410,473,530 887,856,139 456,707,528 884,887,604 477,502,969 935,153,787 461,292,002 971,776,790 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 157 KODIAK ISLAND BOROUGH Full -Time Equivalent Borough Employees by Function/Program Last Ten Fiscal Years Source: Borough Finance Department 158 Full-time Equivalent Employees as of June 30: 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 2019 2020 2021 2022 2023 Function: General Government 28 25 25 26 25 Community and Economic Development 3 2 2 3 3 Municipal Solid Waste Collection and Disposal 8 9 8 8 8 Kodiak Fisheries Research Center 2 2 2 2 2 Total 41 38 37 39 38 Source: Borough Finance Department 158 KODIAK ISLAND BOROUGH Operating Indicators by Function Last Ten Fiscal Years 159 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Function General Government Elections Number of registered voters 9,209 9,100 9,585 9,453 9,357 10,039 10,104 10,258 10,163 10,192 Number voting in last election 1,566 1,968 1,800 2,303 1,692 1,266 1,550 2,084 1,393 1,430 Percent of registered voters 17% 22% 19% 24% 18% 13% 15% 20% 14% 140% Public Safety Number of fire stations 2 2 2 2 2 2 2 2 2 2 Number of employees 1 1 I 1 I 1 I 1 I I Community and economic development Zoning compliance permits issued 111 183 161 177 128 142 128 110 118 101 Junk cars removed 28 37 21 10 35 79 82 72 43 36 Primary and secondary education Number of students 2,468 1,446 2,437 2,386 2,437 2,395 2,315 2,297 2,275 2,254 Number of General Fund certified staff 186 177 183 196 206 193 185 190 234 228 Number of General Fund classified staff 161 166 173 187 210 189 192 196 214 236 Solid waste disposal Total solid waste disposal in tons 11,826 12,364 12,976 11,646 11,458 12,882 10,989 10,896 11,250 11,123 Baled waste in tons 10,005 8,900 10,454 9,875 10,396 9,584 9,191 9,821 10,017 9,799 Scrap metal in tons 172 205 221 190 128 142 173 108 160 207 Asbestos, cubic yards 390 362 219 179 142 348 509 161 66 59 Source: Borough Finance Department 159 r r- r r- r- = r-- wr_• = r" � -, "" ""9 "" �1 "" "'"1 KODIAK ISLAND BOROUGH Capital Asset Statistics by Function/Program Last Ten Fiscal Years Function oroeram 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GOVERNMENTAL ACTIVITIES I I I 1 I 1 I I I I I I I 1 I I 224 224 Number of buildings (teacher housing, schools and office buildings) 19 19 21 20 20 19 19 19 19 19 Vehicles 14 14 11 14 13 13 13 12 12 27 Inactive School building n/a n/a n/a n/a n/a I 1 1 I I Roads Streets (miles) 26.1 26.1 26.1 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 Police: none (provided by the City of Kodiak within the city limits and by the State of Alaska outside the city boundaries) Fire and Emereencv Services Number of fire stations 2 2 2 2 2 2 2 2 2 2 Number of Emergency response vehicles 12 12 10 11 13 12 12 12 12 11 Emergency Tsunami Shelters I I 1 1 0 0 0 0 0 0 BUSINESS -TYPE ACTIVITES Municipal Solid Waste Number of Baler Facilities (Landfills) Community Health & Public Services Mental Health Facilities Hospital Long Term Care Center Culture. Parks and Recreation Parks (number of acres) Facilities. Number of Swimming Pools Number of playgrounds Kodiak Island Research Facilities (marine research) Dorm facility (6 apartments) I I I 1 I 1 1 1 1 1 I I t I I I I 1 I 1 I I I I I I I 1 I I 224 224 224 224 224 224 224 224 224 224 1 16 1 16 1 16 1 16 1 16 1 16 1 16 1 16 1 16 1 16 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 I 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 160