FINANCE COMMITTEE Packet - 8/12/2014
CITY OF MUSKEGO
FINANCE COMMITTEE AGENDA
August 12, 2014
5:30 PM
City Hall, W182 S8200 Racine Avenue
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ROLL CALL
PUBLIC MEETING NOTICE
APPROVAL OF MINUTES - July 22, 2014
LICENSE APPROVALS
1. Recommend Approval of Operator Licenses
2. Recommend Approval of "Class B" Retailers' License for the Sale of Fermented Malt
Beverages and Intoxicating Liquor and Class A Dance Hall License for 4 Corners Pub
LLC, S98 W12532 Loomis Court, Richard Smith Agent (Outside Sales Until 2:00 a.m.)
3. Recommend Approval of "Class B" Retailers' License for the Sale of Fermented Malt
Beverages and Intoxicating Liquor and Class B Dance Hall License for T.J.'s
Roundabout, LLC, S102 W19570 Kelsey Drive, Jerrylee Coubal Agent (Outside Sales
Until 2:00 a.m.)
4. Recommend Approval of "Class A" Retailers' License for the Sale of Fermented Malt
Beverages and Intoxicating Liquors for OM Muskego Oil, Inc. (d/b/a Express), S66
W14501 Tess Corners Drive, Kalpesh Patel Agent
5. Recommend Approval of a Temporary License to Sell Wine and Fermented Malt
Beverages - Muskego Corvette Club. Event to be held at Sindic Motorcars on August
23, 2014 located at Janesville Road and Racine Avenue
6. Recommend Approval of an Outside Dance Permit and Amendment to Licensed Premise
for The Suburban Bourbon, S76 W17745 Janesville Road, for August 24 (8:00 a.m. -
5:00 p.m.) and November 22 (10:00 a.m. - 5:00 p.m.)
2013 AUDIT PRESENTATION
NEW BUSINESS
VOUCHER APPROVAL
1. Utility Vouchers
2. Tax Vouchers
Finance Committee Agenda 2
August 12, 2014
3. General Fund Vouchers
FINANCE DIRECTOR’S REPORT
1. Second Quarter 2014 Operating Results
COMMUNICATIONS AND ANY OTHER BUSINESS AS AUTHORIZED BY LAW
1. Jensen Park Lift Station Improvement Project
ADJOURNMENT
NOTICE
IT IS POSSIBLE THAT MEMBERS OF AND POSSIBLY A QUORUM OF MEMBERS OF OTHER GOVERNMENTAL BODIES OF
THE MUNICIPALITY MAY BE IN ATTENDANCE AT THE ABOVE-STATED MEETING TO GATHER INFORMATION; NO ACTION
WILL BE TAKEN BY ANY GOVERNMENTAL BODY AT THE ABOVE-STATED MEETING OTHER THAN THE GOVERNMENTAL
BODY SPECIFICALLY REFERRED TO ABOVE IN THIS NOTICE.
ALSO, UPON REASONABLE NOTICE, EFFORTS WILL BE MADE TO ACCOMMODATE THE NEEDS OF DISABLED
INDIVIDUALS THROUGH APPROPRIATE AIDS AND SERVICES. FOR ADDITIONAL INFORMATION OR TO REQUEST THIS
SERVICE, MUSKEGO CITY HALL, (262) 679-4100.
Unapproved
CITY OF MUSKEGO
FINANCE COMMITTEE MINUTES
July 22, 2014
5:30 PM
City Hall, W182 S8200 Racine Avenue
CALL TO ORDER
Mayor Chiaverotti called the meeting to order at 5:31 p.m.
PLEDGE OF ALLEGIANCE
Those present recited the Pledge of Allegiance.
ROLL CALL
Present: Committee Members Aldermen Hammel and Kubacki. Also present: Aldermen
Engelhardt, Madden and Wolfe (arrived at 5:38 p.m.), Parks & Recreation Director
Anderson and Finance and Administration Director Mueller. Committee Member Alderman
Borgman was absent.
PUBLIC MEETING NOTICE
Ms. Mueller stated that the meeting was properly noticed.
APPROVAL OF MINUTES - July 8, 2014
Alderman Kubacki made a motion to approve the July 8, 2014 minutes. Alderman
Hammel seconded.
Motion Passed 2 in favor.
LICENSE APPROVALS
Recommend Approval of Operator Licenses
Alderman Hammel made a motion to recommend approval of Operator Licenses for
Nicole Baraniak, Heather Bednarz, Gregory Callan, Siobhan Contreras, Jamie Cooper,
Jennifer Dumke, Erika Elieff-Jimenez, Janet Foster, Nicholas Grochowski, Carolann
Hanrahan, Shannon Hanson, Joellyn Hecimovich, Timothy Koriath, Barbara McNally,
Bradley Metzger, Deborah Prohaska, David Roman, Victor Rozanski, Karen
Rozmarynowski, Jenna Scholbe, Sheila Schultz, Brittany Skowronski, Ashley
Suminski, Lynn Tran, Samantha Trepczyk, Dona Wichman, Lindsay Wysocki, Paula
Zeller. Alderman Kubacki seconded.
Motion Passed 2 in favor.
Recommend Approval of "Class B" Retailers' License for the Sale of Fermented Malt
Beverages and Intoxicating Liquor for Phil & Dom DeMarinis Denoon Saloon, Inc., W198
S10857 Racine Avenue, Agent Lucia DeMarinis
Finance Committee Minutes 2
July 22, 2014
Alderman Kubacki made a motion to recommend Approval of "Class B" Retailers'
License for the Sale of Fermented Malt Beverages and Intoxicating Liquor for Phil &
Dom DeMarinis Denoon Saloon, Inc., W198 S10857 Racine Avenue, Agent Lucia
DeMarinis. Alderman Hammel seconded. The licensed premise includes an enclosed
deck and front porch until 11:00 p.m.
Motion Passed 2 in favor.
Recommend Approval of Temporary License for the Sale of Wine and Fermented Malt
Beverages for Common Ground Ministry, Inc. (Refashion for Life Event to be held at Callen
Construction) - August 20, 2014
Alderman Hammel made a motion to recommend Approval of Temporary License for
the Sale of Wine and Fermented Malt Beverages for Common Ground Ministry, Inc.
(Refashion for Life Event to be held at Callen Construction) - August 20, 2014.
Alderman Kubacki seconded.
Motion Passed 2 in favor.
NEW BUSINESS
Recommend Award of Bid - Park Arthur West - Phase I
Parks & Recreation Director Anderson stated that the Parks & Recreation Board
recommended that the base bid submitted by Super Western in the amount of $820,703.20 be
accepted. The City also requested alternate bids. The Board also recommended that the bid
in the amount of $21,972.02 for the berm (Alternate 4) be accepted. The total award would be
$842,675.22. The total project funding, which includes contributions from the Muskego Kickers
and Muskego Warriors, is $715,522.35. The total project shortage is $127,152.87. The Board
has recommended using the Park Improvement Fund for the project, which has a balance of
$120,572.80. A project shortage of $6,580 remains.
Mayor Chiaverotti suggested that given the large scope of the project, discussion should take
place when the Committee of the Whole reviews all the Capital Budget requests in August.
Alderman Kubacki stated he would like to see what the total cost of the completed project will
be. The Mayor stated that due to time constraints, discussion on this item will continue at
tonight's Common Council meeting.
VOUCHER APPROVAL
Utility Vouchers
Alderman Kubacki made a motion to approve Utility Vouchers in the amount of
$386,698.93. Alderman Hammel seconded.
Motion Passed 2 in favor.
General Fund Vouchers
Alderman Kubacki made a motion to approve General Fund Vouchers in the amount
of $516,842.11. Alderman Hammel seconded.
Motion Passed 2 in favor.
Finance Committee Minutes 3
July 22, 2014
Wire Transfers for Payroll Transmittals
Alderman Kubacki made a motion to approve Wire Transfers for Payroll Transmittals
in the amount of $344,348.90. Alderman Hammel seconded.
Motion Passed 2 in favor.
ADJOURNMENT
Alderman Hammel made a motion to adjourn at 5:47 p.m. Alderman Kubacki
seconded.
Motion Passed 2 in favor.
OPERATOR LICENSE APPROVALS
COMMON COUNCIL – 08/12/2014
Kelli Middleton
Katie Mont
Nicklaus Ryan
John Strasser
Marvin Strasser
Karen Wyszkowski
S/CityHall/Licenses/Oper Lic Approval Lists/2014.doc
CITY OF MUSKEGO
Muskego, Wisconsin
FINANCIAL STATEMENTS
Including Independent Auditor's Report
As of and for the Year Ended December 31, 2013
City of Muskego
Table of Contents
As of and for the Year Ended December 31, 2013
Independent Auditors' Report
Management's Discussion and Analysis
Basic Financial Statements
1 - 2
3 -12
Statement of Net Position 13
Statement of Activities 14
Balance Sheet -Governmental Funds 15
Statement of Revenues, Expenditures and Changes in
Fund Balances -Governmental Funds 16
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement of Activities 17
Statement of Revenues, Expenditures, and Changes in Fund
Balance -Budget and Actual -General Fund 18
Statement of Net Position -Proprietary Funds 19
Statement of Revenues, Expenses, and Changes in Net Position -
Proprietary Funds
Statement of Cash Flows -Proprietary Funds
Statement of Fiduciary Net Position -Fiduciary Funds
Statement of Changes in Fiduciary Net Position -Fiduciary Funds
Index to Notes to Financial Statements
Notes to Financial Statements
20
21 -22
23
24
25
26 -61
City of Muskego
Index to Notes to Financial Statements
As of and for the Year Ended December 31, 2013
Supplementary Information
Combining Balance Sheet -Non-major Governmental Funds -
Special Revenue Funds
Combining Balance Sheet -Non-major Governmental Funds -
Capital Projects Funds
Combining Balance Sheet -Non-major Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances -Non-major Governmental Funds -Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances -Non-major Governmental Funds -Capital Projects Funds
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances -Non-major Governmental Funds
62 -63
64
65
66 -67
68
69
INDEPENDENT AUDITORS' REPORT
To the Mayor and Common Council
City of Muskego
Muskego, Wisconsin
INDEPENDENT AUDITORS' REPORT
Report on the Financial Statements
Baker Til ly Vi rchow Krause, LLP
777 E Wisconsin Ave, 32nd Floo r
Milwaukee, WI 53202-5313
rel 414 777 5500
fax 414 777 5555
bakerrilly.com
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of Muskego, Wisconsin , as
of and for the year ended December 31, 2013, and the related notes to the financial statements, which
collectively comprise the City of Muskego's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of
financial statements that are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors ' judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the City of Muskego's preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances but not for the purpose of expressing an opinion on the effectiveness of the City of Muskego's
internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
~ ~f, 1r·depe~!l~rt r,em:le1 ot
BAKER TILLY
INTE R NATIONAL
Page 1
An Affirmati ve Act ion Equal Opportunit y Employer
To the Mayor and Common Council
City of Muskego
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities, the business-type activities, each major fund, and the
aggregate remaining fund information of the City of Muskego, Wisconsin, as of December 31, 2013 and the
respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary
comparison for the General Fund for the year then ended in accordance with accounting principles generally
accepted in the United States of America.
Emphasis of Matter
As discussed in Note I, the City of Muskego adopted the provisions of GASB Statement No. 65, Items
Previously Reported as Assets and Liabilities, effective January 1 , 2013. The prior year has been restated for
this change. Our opinions are not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis as listed in the table of contents be presented to supplement the basic financial
statements. Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for
placing the basic financial statements in an appropriate operational, economic, or historical context. We have
applied certain limited procedures to the required supplementary information in accordance with auditing
standards generally accepted in the United States of America, which consisted of inquiries of management
about the methods of preparing the information and comparing the information for consistency with
management's responses to our inquiries, the basic financial statements, and other knowledge we obtained
during our audit of the basic financial statements. We do not express an opinion or provide any assurance on
the information because the limited procedures do not provide us with sufficient evidence to express an opinion
or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City of Muskego's basic financial statements. The combining fund financial statements as listed in
the table of contents are presented for purposes of additional analysis and are not a required part of the basic
financial statements. Such information is the responsibility of management and was derived from and relates
directly to the underlying accounting and other records used to prepare the 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 combining fund financial statements are fairly
stated in all material respects, in relation to the basic financial statements as a whole.
~/c.tA "7Lr Yt~1w ~raua, uP
Milwaukee, Wisconsin
August6,2014
Page2
MANAGEMENT'S DISCUSSION
AND
ANALYSIS
City of Muskego, Wisconsin
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
As management of the City of Muskego, we offer readers of these financial statements this
narrative overview and analysis of the financial activities of the City for the fiscal year ended
December 31, 2013. The discussion and analysis presents the highlights of financial activities
and financial position for the City of Muskego (City). The analysis focuses on significant financial
issues, major financial activities and resulting changes in financial position, budget changes and
variances from the budget, and specific issues related to funds and the economic factors affecting
the City.
Financial Highlights
• The assets and deferred outflows of resources of the City exceeded its liabilities and
deferred inflows of resources by $123,683,839 as of December 31, 2013. Of this
amount, $20,420,371 (unrestricted net position) may be used to meet the government's
ongoing obligations to citizens and creditors. Compared to the prior year, the City's total
net position decreased by $978,377.
• At the close of the 2013 fiscal year, the City's governmental funds reported combined
ending fund balances of $19,464,414, which is a decrease of $4,603,564 in comparison
with the prior year. Of this total amount, approximately 82% or $16,010,789 is available
for spending at the government's discretion (committed, assigned and unassigned fund
balances).
• The City's combined committed and unassigned fund balance for the General Fund was
$6,218,392 or 45% of the total general fund expenditures (including transfers out) for
fiscal year 2013. Of this total, $5,267,935 is committed to meet the requirements of the
City's Fund Balance and Annual General Fund Budgeted Contingency policy.
• The City of Muskego's total long-term debt, excluding compensated absences,
decreased by $2,645, 106 (6.16%) during the 2013 fiscal year. In addition to net
scheduled payments, contributing to the decrease was the issuance of $9,550,000
General Obligation Refunding Bonds to advance refund the outstanding 2001, 2003 and
2004 G.O. Bonds and CDA Lease Revenue Bond saving the City over $1 million in long-
term interest payments.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City of Muskego's
basic financial statements. The City's basic financial statements comprise three components:
1) government-wide financial statements, 2) fund financial statements and 3) notes to the
financial statements. This report also contains other supplementary information in addition to the
basic financial statements themselves.
Government-wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview
of the City of Muskego's finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City's assets, deferred outflows of
resources, liabilities, and deferred inflows of resources, with the difference reported as net
position. Over time, increases or decreased in net position may serve as a useful indicator of
whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net position changed
during the most recent fiscal year. All changes in net position are reported as soon as the
underlying event giving 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 only result in
cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation and
sick leave).
Page3
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
Government-wide Financial Statements (continued)
Both the government-wide financial statements distinguish functions of the City of Muskego that
are principally supported by taxes and intergovernmental revenues (governmental activities) from
other functions that are intended to recover all or a significant portion of their costs through user
fees and charges (business-type activities). The governmental activities of the City of Muskego
include general government, public safety, public works, health and sanitation, recreation and
education and conservation and development. Business-type activities of the City include the
Sewer Utility and the Water Utility.
The government-wide financial statements include the City of Muskego and the following
component units: The Community Development Authority and the Big Muskego Lake Bass Bay
Protection and Rehabilitation District. There are no other organizations or agencies whose
financial statements should be combined and presented with the financial statements of the City.
The government-wide financial statements can be found on pages 13 through 14 of this report.
Fund Financial Statements
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 City of Muskego, like other state and
local governments, uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements. All of the funds of the City can be divided into three categories:
governmental funds, proprietary funds, and fiduciary funds.
Governmental Funds
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 financial statements, governmental funds financial statements focus on the
near-term inflows and outflows of spendable resources, as well as on balances of spendable
resources available at the end of the fiscal year. Such information may be useful in evaluating a
government's near-term financing requirements.
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 governmental funds with similar
information presented for governmental activities in the government-wide financial statements.
By doing so, readers may better understand the long-term impact of the government's near-term
financing decisions. 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 City of Muskego maintains twenty-six individual governmental funds. Information is
presented separately in the governmental fund balance sheet and in the governmental fund
statement of revenues, expenditures and changes in fund balances for the General Fund, Debt
Service Fund, Capital Budget Fund and Tax Increment District Capital Project Funds, all of which
are considered to be major funds. Individual fund data for each of the twenty-two non-major
governmental funds is provided in the form of combining statements and can be found on pages
62 through 69 of this report.
The City of Muskego adopts an annual appropriated budget for its General Fund. A budgetary
comparison statement has been provided for the General Fund to demonstrate compliance with
its budget on page 18 this report. The basic governmental fund financial statements can be
found on pages 15 through 18 of this report.
Page4
Proprietary Funds
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
The City of Muskego maintains one type of proprietary fund: Enterprise funds are used to report
the same functions presented as business-type activities in the government-wide financial
statements. The City of Muskego maintains two enterprise funds.
Proprietary funds provide the same type of information as the government-wide financial
statements, only in more detail. The proprietary fund financial statements provide separate
information for the water and sewer operations, both of which are considered to be major funds of
the City.
The basic proprietary fund financial statements can be found on pages 19 through 22 of this
report.
Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. Fiduciary funds are not reflected in the government-wide financial statement
because the resources of those funds are not available to support the City of Muskego's own
programs. The accounting used for fiduciary funds is much like that used for proprietary funds.
The fiduciary funds for the City are private purpose trust funds and agency funds. Total assets of
the fiduciary funds were $37,040,703.
The basic fiduciary funds financial statements can be found on pages 23 and 24 of this report.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data
provided in the government-wide and fund financial statements. The notes to the financial
statements can be found on pages 25 through 61 of this report.
Other Information
The combining statements referred to earlier in connection with non-major governmental funds is
presented immediately following the notes to the financial statements. Combining and individual
fund statements and schedules can be found on pages 62 through 69 of this report.
Government-Wide Financial Analysis
As financial information is accumulated from year-to-year, changes in net position may serve as a
useful indicator of a government's financial position. In the case of the City of Muskego, assets
and deferred outflows of resources exceeded liabilities and deferred inflows of resources by
$123,683,839 as of December 31, 2013.
The largest portion of the City of Muskego's net position (74.72%) reflects its investment in capital
assets (e.g., land, buildings, improvements, and machinery and equipment), less any debt used
to acquire those assets that is still outstanding. The City of Muskego uses these capital assets to
provide services to citizens. Consequently, these assets are not available for future spending.
Although the City's investment in its 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.
Page 5
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
The following provides a summary of the City's net position:
City of Muskego -Net Position
Governmental Activities Business -type Activities Total
2012 2012
2013 (Restated) 2013 (Restated) 2013
Current and other
assets $34,696,534 $ 38,743,021 $ 22,372,653 $ 22,378,935 $ 57,069,187
Capital assets 56,512,507 54,369,476 71,190,306 72,220,498 127,702,813
Total assets 91,209,041 93,112,497 93,562,959 94,599,433 184, 772,000
Deferred outflows
of resources 52,888 98,221 52,888
Total Assets and
Deferred Outflows
of Resources 91,209,041 93,112,497 93,615,847 94,697,654 184,824,888
Current liabilities 1,939,329 1,527,189 2,140,171 2,969,163 4,079,500
Noncurrent outstanding 35,394,445 37,138,819 7,508,308 7,022,158 42,902,753
Other liabilities 609,452 1,110,023 609,452
Total liabilities 37,333,774 38,666,008 10,257,931 11,101,344 47,591,705
Deferred inflows
of resources 13,512,511 13,339,874 36,833 40,709 13,549,344
Net investment
in capital assets * 29,421,549 30,038,875 64,480,552 65,256,815 92,410,392
Restricted 3,135,669 3,262,687 7,717,407 7,047,779 10,853,076
Umestricted * 7,805,538 7,805,053 11,123,124 11,251,007 20,420,371
Total net position 40,362,756 41,106,615 83,321,083 83,555,601 123,683,839
Total Liabilities, Deferred
Inflows of Resources,
and Net Position $91,209,041 $ 93,112,497 $ 93,615,847 $ 94,697,654 $184,824,888
At the end of the 2013 fiscal year, the City is able to report positive balances in all three
categories of net position, both for the government as a whole, as well as for its separate
governmental and business-type activities.
Changes in Net position
As of December 31, 2013, total net position of the City of Muskego amounted to $123,683,839,
which is a decrease of $978,377 as compared to the 2012 fiscal year end. The major item
attributing to this decrease is a $1 million reduction in landfill host funds received.
Net position of the City's governmental activities totaled $40,362,756, which is a decrease of
$743,859 as compared to the prior year. Of this total, $7,805,538 or 19.34% is classified as
unrestricted net position and may be used to finance the City's ongoing obligations to citizens and
creditors. The restricted net position portion (7.8%) represents resources that are subject to
external restrictions on how they may be used, which include financing for debt service.
* The net position section includes an adjustment for capital assets owned by the business-type
activities, but financed by the debt of the governmental activities.
Page6
2012
(Restated)
$ 61,121,956
126,589,974
187,711,930
98,221
187,810,151
4,496,352
44,160,977
1,110,023
49,767,352
13,380,583
93,746,308
10,310,466
20,605,442
124,662,216
$187,810,151
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
The business-type activities net position amounted to $83,321,083, a decrease of $234,518. The
unrestricted balance of $11, 123, 124 is used to finance the continued operations of the water and
sewer utilities.
The following schedule highlights the key elements of the City's revenues and expenses for the
2013 and 2012 fiscal year ends. These two main components are subtracted to yield the change
in net position and are summarized as follows:
Revenues:
Program Revenues
City of Muskego's Change in Net Position
Governmental
Activities
2013 2012
Business-type
Activities
2013 2012
Total
2013 2012
Charges for services
Operating grants and
contributions
$ 4,103,933 $ 4,917,037 $ 7,919,840 $ 7,992,576 $ 12,023,773 $ 12,909,613
Capital grants and contributions
General Revenues
Property taxes
Other Taxes
Grants and contributions not
restricted to specific programs
Umestricted investment
earnings
Gain on sale of capital assets
Miscellaneous
Total Revenues
Expenses:
General government
Public safety
Public works
Health and sanitation
Conservation and development
Education and recreation
Interest on long-term debt
Sewer
Water
Total Expenses
Increase (Decrease) in Net
Position before transfers
Transfers
Change in Net Position
Net Position -Beginning (Restated)
Net Position -Ending
1,530,772
150,521
1,304,573
389,437
13,214,540 13,025,665
97,956 153,193
461,747
179,368
5,099
452,173
193,142
32,226
1,957 651
19,745.893 20,468,097
2,718,970
6,373,285
5,124,602
1,171,585
1,554,576
2,559,324
1,578,446
21,080,788
(1,334,895)
591,036
(743,859)
2,572,319
6,512,524
3,681,505
1,149,702
473,240
2,853,599
1,137,059
18,379,948
2,088,149
577,659
2,665,808
7,509
966,398
84,298
8,978,045
6,879,476
1,742,051
8,621,527
356,518
(591,036)
(234,518)
75,905
523,202
104,647
8,696,330
6,599,561
1,650,541
8,250,102
446,228
(577,659)
(131,431)
41,106,615 38,440,807 83,555,601 83,687,032
$ 40,362,756 $ 41,106,615 $ 83,321,083 $ 83,555,601 $
Page 7
1,538,281
1,116,919
13,214,540
97,956
461,747
263,666
5,099
1,957
28,723,938
2,718.970
6,373,285
5,124,602
1,171,585
1,554,576
2,559,324
1,578,446
6,879,476
1,742,051
29,702,315
(978,377)
(978,377)
124,662,216
1,380,478
912,639
13,025,665
153,J 93
452,173
297,789
32.226
651
29,164,427
2,572,319
6,512,524
3,681,505
1,149,702
473,240
2,853,599
1,137,059
6,599,561
1,650,541
26.630,050
2,534,377
2,534.377
122,127,839
123,683,839 $ 124,662,216
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
Governmental Activities
The table below discloses cost of services for Governmental Activities. The total cost of services
column contains all costs related to the programs. The net of services column shows how much
of the total amount is not covered by program revenues. Succinctly put net costs that must be
covered by local taxes or other general revenue or transfers.
Programs
General government
Public safety
Public works
Health and sanitation
Conservation & development
Education and recreation
Interest and long-term debt
Total
$
Total Cost of
Services
2013
2,718,970 $
6,373,285
5,124,602
1,171,585
1,554,576
2,559,324
1,578,446
2012
2,572,319 $
6,512,524
3,681,505
1, 149,702
473,240
2,853,599
1, 137,059
$ 21,080,788 $ 18,379,948 $
Net (Expenses)
of Services
2013
(2,374,370) $
(5,449,879)
(4,008,809)
1, 108,483
(1,482,602)
(1,552,807)
{1,535,578)
2012
(2, 162,023)
(5,669,663)
(2,793,684)
2,063,839
(29, 133)
(2,079,337)
(1,098,900)
(15,295,562) $ (11,768,901)
The major change in total cost of services was reflected in the public works and conservation
developments functions, which increased by approximately $2.5 million. In 2013, these functions
included additional capital outlay costs road projects and an incentive payment for development
along Moorland Road.
Net cost of services is 73% of total cost of services in 2013. This reflects a continued reliance on
taxes and other general revenue sources to fund the cost of services.
The graph below shows the percentage of the total governmental activities revenues allocated by
each revenue type.
Revenues by Source -Governmental Activities
Miscellaneous
Fees
0.04%
Property taxes
67.42%
Investment
Earnings
0.91%
Page 8
Charges for
Services
20.78% Operating
Grants and
Contributions
Capital Grants
and
Contributions
0.76%
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
Business-Type Activities
Total Business-type activities' charges for service revenues for the year ending December 31,
2013 were $7,919,840 , which is a decrease of $72,736 over 2012. This was primarily due to
lower consumption usage as a result of the current economic climate and weather conditions.
The Business-type activities decreased the City of Muskego's net position by $234,518. This was
mainly due to the increase in the Milwaukee Metropolitan Sewer District annual capital charge .
The following graph shows the relationship between revenues and expenses for the City of
Muskego Sewer and Water Utilities.
Expenses and Revenues • Business-type Activities
8,000,000 ,___----------~--------------.
7,000 ,0 00 ·I----
6,000 ,000 +---
5,000,000 +----
4,000,000 ---
3,000,000 ---
2,000,000 +---
1,000,000 +----I~ ·_,, -
Sewer Utility Water Utility
I ll:IExpenses •Charges for Service I
The graph below displays the breakdown of revenues by source for the business-type activities.
Revenues by Source -Business-type Activities
Operating Grants
& Contributions
0 .08%
Investment
Earnings
0.94%
Capital Grants &
Contributions
10.76%
Page 9
a Charges for Service
•Investment Earnings
110perating Grants & Contributions
•Capital Grants & Contributions
Charges for
Service
88.21%
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
Financial Analysis of the Government's Funds
As noted earlier, the City of Muskego uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements. This section will discuss major
developments within the City's governmental funds and proprietary funds.
Governmental Funds
The focus of the City's governmental funds is to provide information on near-term inflows,
outflows, and balances of spendable resources. Such information is useful in assessing the
City's financing requirements. In particular, unrestricted fund balance (includes committed,
assigned and 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 City's governmental funds -General Fund, Debt
Service Fund, Tax Increment District Capital Project Funds, and all Other Non-major
Governmental Funds -reported a combined ending fund balances of $19,464,414, a decrease of
$4,603,564 in comparison with the prior year. Approximately 82% of this total amount
($16,010,789) is available for spending at the government's discretion. However, approximately
79% of this amount ($12,662,042) is classified as committed, assigned or reported in special
revenue funds or capital projects funds. The remainder of the fund balance is non-spendable or
restricted.
General Fund
The General Fund is the chief operating fund of the City. During 2013, the General Fund balance
increased by $188,200. This is primarily due to actual expenses being less than budgeted, which
resulted from position vacancies, employee benefit reductions and additional interest earnings.
At the end of the year, the committed and unassigned fund balance of the General Fund was
$6,218,392, while total fund balance reached $6,266,661. As a measure of the general fund's
liquidity, it is useful to compare both unrestricted fund balance and total fund balance to total fund
expenditures. The net committed and unassigned fund balance represents 45% of total general
fund expenditures.
Debt Service Fund
Fund balance in the Debt Service Fund decreased by $122,351 during 2013. This decrease
resulted from the increase in principal payments in 2013, due to the refunding of the 2001 & 2004
G.O. Bonds and 2003 C.D.A. Lease Revenue Bonds.
Capital Budget Fund
Fund balance in the Capital Budget Fund decreased by $3,016,319 during 2013. This decrease
relates to current year expenditures for several road projects and conservation related purchases,
where the funds were borrowed for in the prior year.
Proprietary Funds
The City's proprietary fund statements provide the same type of information found in the
government-wide financial statements, but in more detail. At year-end, net position of the Sewer
Utility Fund amounted to $57,778,291 with the Water Fund totaling $25,542,792. The Sewer
Utility Fund and the Water Utility Fund decreased in net position in 2013; $209,755 and $24,763,
respectively.
Page 10
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
General Fund Budgetary Highlights
The 2013 final budget of $14,310,585 included no amendments for the year. During the year,
however, revenues were more than budgetary revenues and expenditures were less than
budgetary expenditures.
Capital Assets and Debt Administration
Capital Assets
The City of Muskego's investment in capital assets for its governmental and business-type
activities as of December 31, 2013, amounts to $127, 702,813 (net of accumulated depreciation).
This investment in capital assets includes land, buildings and improvements, equipment,
infrastructure and construction in progress.
Major capital events during the current year included road reconstruction and paving, storm water
related stabilization projects, various park related projects, land conservation purchase and water
utility pumping station.
City of Muskego's Capital Assets
(net of depreciation)
Governmental Business-Type
Activities Activities Total
2013 2012 2013 2012 2013
Land $ 5,539,936 $ 5,533,922 $ 160,066 $ 160,066 $ 5,700,002
Intangibles 221,580 207,430 36,500 36,500 258,080
Construction in progress 4,465,877 2,859,682 374,415 487,174 4,840,292
Land Improvements 3,930,454 3,944,754 3,930,454
Buildings 13,196,365 13,196,365 20,186,877 20,144,704 33,383,242
Equipment 7,571,300 7,272,487 4,467,082 4,375.806 12,038,382
Library Collection 2,812,983 2,669,657 2,812,983
Infrasturcture 62,178,263 59,262,681 74,604,380 73,761,717 136,782,643
Acc. Deprectiation (43,404,251) ( 40,577 ,502) (28,639,014) (26,745,469) (72,043,265)
Total $ 56,512,507 $ 54,369,476 $ 71,190,306 $ 72,220,498 $ 127,702,813
Additional information on the City's capital assets can be found in Note IV on pages 47 through
49 of this report.
Long-term Debt
As of December 31, 2013, the City of Muskego's governmental activities had general obligation
bonds and notes outstanding totaling $31,077,425. The City's business-type activities include
revenue bonds and notes payable, which total $8,209,076.
In the current year, the City paid $24,937,515 in principal and $1, 131,376 in interest on
outstanding debt. Business-Type Activities paid $2, 137,648 in principal and $298,089 in interest
on its outstanding debt.
Of the total City debt, $2,825,701 will become due within one year. The City of Muskego has a
Moody's "Aa2" rating on its General Obligation Debt, a Moody's "Aa2" rating on its Sewer
Revenue Bonds and a Moody's "Aa3" on its Water Revenue Bonds.
Page 11
$
$
2012
5,693,988
243,930
3,346,856
3,944,754
33,341,069
11,648,293
2,669,657
133,024,398
(67,322,971)
126,589 ,97 4
City of Muskego
Management Discussion and Analysis
As of and for the Year Ended December 31, 2013
(Unaudited)
Long-term Debt (continued)
City of Muskego's Outstanding Debt
General Obligation and Revenue Bonds
Governmental Business-Type
Activities Activities Total
2012 2012
2013 (Restated) 2013 (Restated) 2013
G.O. Bonds and Notes $ 31,077,425 $ 32,334,940 $ 1,462,575 $ 1,565,060 $ 32,540,000
Community Development
Lease Reveneu Bonds 1,440,000
Revenue Bonds 4,350,000 4,730,000 4,350,000
Revenue Refunding Bonds 1,990,000 2,365,000 1,990,000
Wisconsin Safe Drinking
Water Loan 406,501 426,664 406,501
Total $ 31,077,425 $ 33,774,940 $ 8,209,076 $ 9,086,724 $ 39,286,501
Additional information about the City's long-term debt can be found in Note IV on pages 50
through 53 of the financial statements.
Economic Factors and Next Year's Budgets and Rates
The following economic factors are noteworthy:
• The City of Muskego's equalized valuation for 2013 (Tax Increment Value included)
amounted to a tax base of $2.5 billion. The average equalized value of a single-family
home in Muskego was $273,000.
• Although growth has slowed considerably, Muskego's financial position is expected to
remain positive due in part to its trend of regular General Fund operating surpluses and
maintaining reserves resulting from sound financial operations.
• Debt levels are expected to remain affordable due to a sound pace of amortization with
future borrowing plans. The City's overall debt burdens have continued to remain below
the median for Wisconsin cities.
• The City of Muskego's 2013 tax rate increased slightly to $4.91 per thousand as
compared to the 2012 rate of $4.40 per thousand.
All these factors were considered in preparing the City of Muskego's budget for the year ending
December 31, 2013.
Requests for information
This financial report is designed to provide a general overview of the City of Muskego's finances
for all those with an interest in the government's finances. Readers having question about any of
the information in this report or needing additional information should contact Director of Finance
and Administration, City of Muskego, W182 88200 Racine Ave, Muskego, WI 53150, direct
contact at 262-679-5622 or e-mail smueller@cityofmuskego.org.
Page 12
2012
(Restated)
$ 33,900,000
1,440,000
4,730,000
2,365,000
426,664
$ 42,861,664
BASIC FINANCIAL STATEMENTS
City of Muskego
Statement of Net Position
As of December 31, 2013
Governmental Business-type
Activities Activities Totals
ASSETS
Cash and cash equivalents $ 20, 172, 109 $ 9,091,953 $ 29,264,062
Temporary investments 735,386 735,386
Receivables (net of allowance for uncollectibles)
Accounts 899,614 2,549,715 3,449,329
Due from other governments 26,452 26,452
Taxes 13,535,865 13,535,865
Prepaid items 62,494 1,100 63,594
Deferred charge 286,271 286,271
Restricted Assets
Cash and cash equivalents 9,136,875 9,136,875
RCA and WCA assessments receivable 367,850 367,850
Special assessments receivable 203,503 203,503
Capital Assets
Land and easements 5,539,936 196,566 5,736,502
Construction in progress 4,465,877 374,415 4,840,292
Other capital assets, net of depreciation 46,506,694 70,619,325 117,126,019
Total Assets 91,209,041 93,562,959 184,772,000
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding 52,888 52,888
Total Deferred Outflows of Resources 52,888 52,888
LIABILITIES
Accounts payable and other current liabilities 1,654,040 1,032,654 2,686,694
Accrued interest payable 219,720 219,720
Unearned revenue 65,569 71,928 137,497
Liabilities payable from restricted assets
Accounts payable 183,698 183,698
Accrued interest payable 49,605 49,605
Current portion of long-term debt 802,286 802,286
Noncurrent Liabilities:
Due within one year 2, 155,415 2,155,415
Due in more than one year 33,239,030 7,508,308 40,747,338
Unearned revenue 609,452 609,452
Total Liabilities 37,333,774 10,257,931 47,591,705
DEFERRED INFLOWS OF RESOURCES
Unearned revenue 13,512,511 36,833 13,549,344
Total Deferred Inflows of Resources 13,512,511 36,833 13,549,344
NET POSITION
Net investment in capital assets 29,421,549 64,480,552 92,410,392
Restricted for:
Depreciation and equipment and replacement funds 1,145,566 1,145,566
Water and sewer capacity assessment funds 6,129,025 6,129,025
Tax increment district purposes 821,217 821,217
Debt service 2,314,452 442,816 2,757,268
Un restricted 7,805,538 11, 123, 124 20,420,371
TOTAL NET POSITION $ 40,362,756 $ 83,321,083 $ 123,683,839
See accompanying notes to financial statements.
Page 13
Functions/Programs
Governmental Activities
General government
Public safety
Public works
Health and sanitation
Conservation and development
Education and recreation
Interest on long-term debt and fiscal charges
Total Governmental Activities
Business-type activities
Sewer Utility
Water Utility
Total Business-type Activities
Total
City of Muskego
Statement of Activites
For the Year Ended December 31, 2013
Program Revenues
Operating Capital
Charges for Grants and Grants and
Expenses Services Contributions Contributions
$ 2,718,970 $ 344,600 $ -$ -
6,373,285 771,978 151,428
5,124,602 67,593 985,799 62,401
1,171,585 2,206,845 73,223
1,554,576 43,014 28,960
2,559,324 669,903 248,494 88,120
1,578,446 42,868
21,080,788 4,103,933 1,530,772 150,521
6,879,476 6,041,785 7,509 570,267
1,742,051 1,878,055 396,131
8,621,527 7,919,840 7,509 966,398
$ 29,702,315 $ 12,023,773 $ 1,538,281 $ 1,116,919
General Revenues
Taxes
Property taxes, levied for general purposes
Property taxes, levied for debt service
Other taxes
Intergovernmental revenues not restricted to specific programs
Investment income
Gain on disposal of assets
Miscellaneous
Total General Revenues
Transfers
Change in Net Position
NET POSITION -Beginning of Year (Restated)
NET POSITION -END OF YEAR
See accompanying notes to financial statements.
$
$
Net (Expenses) Revenues and
Changes in Net Position
Governmental Business-type
Activities Activities
(2,374,370) $ -$
(5,449,879)
(4,008,809)
1, 108,483
(1,482,602)
(1,552,807)
(1,535,578)
(15,295,562)
(259,915)
532,135
272,220
(15,295,562) 272,220
11,075,195
2,139,345
97,956
461,747
179,368 84,298
5,099
1,957
13,960,667 84,298
591,036 (591,036)
(743,859) (234,518)
41,106,615 83,555,601
40,362,756 $ 83,321,083 $
Totals
(2,374,370)
(5,449,879)
(4,008,809)
1, 108,483
(1,482,602)
(1,552,807)
(1,535,578)
(15,295,562)
(259,915)
532,135
272,220
(15,023,342)
11,075, 195
2,139,345
97,956
461,747
263,666
5,099
1,957
14,044,965
(978,377)
124,662,216
123,683,839
Page 14
ASSETS
Cash and cash equivalents
Receivables -net
Accounts
Due from other governments
Taxes
Prepaid items
Total Assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts payable
Accrued liabilities
Due to other governments
Unearned revenue
Total Liabilities
Deferred Inflows of Resources
Unearned revenue
Total Deferred Inflows of Resources
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
TOTAL LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
City of Muskego
Balance Sheet
Governmental Funds
As of December 31, 2013
Debt
General Service
Fund Fund
$ 6,746,018 $2,527,045
159,815
5,053 7,127
9,962,264 2, 139,345
48,269
$ 16,921,419 $4,673,517
$ 332,561 $
257,046
65,569
655,176
9,999,582 2,139,345
9,999,582 2,139,345
48,269
2,534,172
2,869,645
3,348,747
6,266,661 2,534,172
$ 16,921,419 $4,673,517
Amounts reported for governmental activities in the statement of net position are different because:
Tax
Increment
Capital District
Budget Capital Project
Fund Funds
$2,077,310 $ 366,656
$2,077,310 $ 366,656
$ 453,408 $
453,408
366,656
1,623,902
1,623,902 366,656
$2,077,310 $ 366,656
Capital assets used in governmental funds are not financial resources and therefore are not reported in the funds. See Note II.
Some liabilites, including long-term debt, are not due and payable in the current period and
therefore are not reported in the funds. See Note II.
NET POSITION OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements.
Nonmajor Total
Governmental Governmental
Funds Funds
$ 8,455,080 $ 20, 172, 109
739,799 899,614
14,272 26,452
1,434,256 13,535,865
14,225 62,494
$ 10,657,632 $ 34,696,534
$ 291,025 $ 1,076,994
257,046
320,000 320,000
65,569
611,025 1,719,609
1,373,584 13,512,511
1,373,584 13,512,511
14,225 62,494
490,303 3,391, 131
7,365,029 10,234,674
803,466 2,427,368
3,348,747
8,673,023 19,464,414
$ 10,657,632
56,512,507
{35,614, 165)
$ 40,362,756
Page 15
City of Muskego
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended December 31, 2013
Tax
Increment
Capital District Non major Total
Debt Budget Capital Project Governmental Governmental
General Service Fund Funds Funds Funds
REVENUES
Taxes $ 9,944,271 $ 2,139,345 $ -$ -$ 1,208,074 $ 13,291,690
Intergovernmental 1,643,859 42,868 208,253 1,894,980
Licenses and permits 667,083 7,203 674,286
Fines, forfeitures and penalties 204,460 204,460
Public charges for services 667,585 2,325,674 2,993,259
Public improvement revenues 62,400 62,400
Commercial revenue 191,159 2,591 3,402 371 201,491 399,014
Intergovernmental charges for services 136,960 136,960
Interdepartmental revenues 83,596 83,596
Total Revenues 13,538,973 2,184,804 65,802 3,950,695 19,740,645
EXPENDITURES
Current
General government 2,241,931 191,422 2,433,353
Public safety 6,112,807 6,112,807
Public works 2,159,467 16,989 2,176,456
Health and sanitation 3,605 1,161,580 1, 165, 185
Conservation and development 295,021 117,425 270,205 682,651
Education and recreation 2,247,413 30,941 2,278,354
Debt service
Principal retirement 24,937,515 24,937,515
Interest 1,131,376 1,131,376
Bond issuance costs 419,370 419,370
Capital outlay 917,224 2,882,121 2,983,261 6,782,606
Total Expenditures 13,977,468 26,488,261 2,882,121 117,425 4,654,398 48,119,673
Deficiency of revenues under expenditures (438,495) (24,303,457) (2,816,319) (117,054) (703,703) (28,379,028)
OTHER FINANCING SOURCES (USES)
Long-term debt issued 22,240,000 22,240,000
Premium on long term debt issued 901,620 901,620
Transfers in 591,036 1,039,486 2,905,190 4,535,712
Transfers out (200,000) (3,744,676) (3,944,676)
Proceeds from sale of capital assets 35,659 7,149 42,808
Total Other Financing Sources (Uses) 626,695 24,181,106 (200,000) (832,337) 23,775,464
Net Change in Fund Balance 188,200 (122,351) (3,016,319) (117,054) (1,536,040) (4,603,564)
FUND BALANCES -Beginning of Year 6,078,461 2,656,523 4,640,221 483,710 10,209,063 24,067,978
FUND BALANCES -END OF YEAR $ 6,266,661 $ 2,534,172 $ 1,623,902 $ 366,656 $ 8,673,023 $ 19,464,414
See accompanying notes to financial statements. Page 16
City of Muskego
Reconciliation of the Statement of Revenues,
Expenditures, and Changes in Fund Balances of Governmental Funds
To the Statement of Activities
For the Year Ended December 31, 2013
Net 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 net position, the cost of these assets is capitalized and they are
depreciated over their estimated useful lives and reported as deprecitaion
expense in the statement of activities.
Capital outlay reported as an expenditure in the fund financial statements
but is capitalized in the government-wide financial statements
Some items capitalized were not reported as capital outlay
Some items reported as capital outlay were not capitalized
Depreciation is reported in the government-wide statements
Net book value of assets retired
Contributed capital assets are reported as revenue in the government-wide
statements.
Debt issued provides current financial resources to governmental funds, but
issuing debt increases long-term liabilities in the statement of net position.
Repayment of debt principal is an expenditure in the governmental funds,
but the repayment reduces long-term liabilities in the statement of net position
Debt issued
Principal repaid
Premium on long term debt issues
Some expenses in the statement of activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in the
governmental funds.
Compensated absences
Accrued interest on debt
CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements.
$
$
(4,603,564)
6,782,606
143,326
(2,048,378)
(3, 164, 111)
(67,451)
497,039
(22,240,000)
24,937,515
(901,620)
(51,521)
(27,700)
(743,859)
Page 17
City of Muskego
Statement of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
General Fund
For the Year Ended December 31, 2013
Variance with
Final Budget -
Budgeted Amounts Over
Original and Final Actual (Under)
REVENUES
Taxes $ 9,955,607 $ 9,944,271 $ (11,336)
Intergovernmental 1,579,430 1,643,859 64,429
Licenses and permits 595,790 667,083 71,293
Fines, forfeitures and penalties 172,000 204,460 32,460
Public charges for service 689,575 667,585 (21,990)
Commercial revenues 119,353 191,159 71,806
Intergovernmental charges for services 133,572 136,960 3,388
Interdepartmental revenues 211,500 83,596 (127,904)
Total Revenues 13,456,827 13,538,973 82,146
EXPENDITURES
Current
General government 2,311,463 2,241,931 (69,532)
Public safety 6,250,822 6, 112,807 (138,015)
Public works 2,020,077 2, 159,467 139,390
Health and sanitation 3,650 3,605 (45)
Conservation and development 308,856 295,021 (13,835)
Education and recreation 2,395,791 2,247,413 (148,378)
Capital Outlay 919,926 917,224 (2,702)
Contigency 100,000 (100,000)
Total Expenditures 14,310,585 13,977,468 (333,117)
Excess (deficiency) of revenues over (under)
expenditures (853,758) (438,495) 415,263
OTHER FINANCING SOURCES
Transfers in 580,000 591,036 11,036
Sale of property 25,000 35,659 10,659
Total Other Financing Sources 605,000 626,695 21,695
Net Change in Fund Balance $ (248,758) 188,200 $ 436,958
FUND BALANCES -Beginning of Year 6,078,461
FUND BALANCES -END OF YEAR $ 6,266,661
See accompanying notes to financial statements.
Page 18
City of Muskego
Statement of Net Position
Proprietary Funds
As of December 31, 2013
Business Type Activities
Enter12rise Funds
Total
Sewer Water Enterprise
Utilit};'. Utilit};'. Funds
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 9,082,318 $ 9,635 $ 9,091,953
Temporary investments 735,386 735,386
Receivables, net 2, 101,942 447,773 2,549,715
Prepaid Items 600 500 1,100
Deferred charge 286,271 286,271
Restricted Assets
Cash and cash equivalents 211,489 280,932 492,421
Total Current Assets 12,418,006 738,840 13,156,846
NON-CURRENT ASSETS
Restricted Assets
Cash and cash equivalents 6,521,784 2,122,670 8,644,454
RCA and WCA assessments receivable 263,235 104,615 367,850
Capital Assets
Land and easements 130,918 65,648 196,566
Construction work in progress 69,656 304,759 374,415
Plant in service 61,788,577 37,469,762 99,258,339
Accumulated depreciation (19,769,712) (8,869,302) (28,639,014)
Other assets
Special assessments 82,689 120,814 203,503
Total Non-Current Assets 49,087,147 31,318,966 80,406,113
Total Assets 61,505, 153 32,057,806 93,562,959
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding 52,888 52,888
Total Deferred Outflows of Resources 52,888 52,888
LIABILITIES AND NET POSITION
CURRENT LIABILITIES
Accounts payable 681,192 37,281 718,473
Accrued vacation, sick leave and compensatory time 210,356 103,825 314,181
Unearned revenue 71,928 71,928
Liabilities Payable From Restricted Assets
Accounts payable 183,698 183,698
Current portion of long-term debt 295,000 507,286 802,286
Accrued interest 14,822 34,783 49,605
Total Current Liabilities 1,201,370 938,801 2, 140, 171
NON-CURRENT LIABILITIES
Long-term debt 2,005,000 5,503,308 7,508,308
Unearned revenue 549,225 60,227 609,452
Total Non-current Liabilities 2,554,225 5,563,535 8,117,760
Total Liabilities 3,755,595 6,502,336 10,257,931
DEFERRED INFLOWS OF RESOURCES
Unearned revenue 24,155 12,678 36,833
Total Deferred Inflows of Resources 24,155 12,678 36,833
NET POSITION
Net investment in capital assets 40,353,277 24,127,275 64,480,552
Restricted for
RCA and WCA funds 5,587,268 541,757 6,129,025
Debt service 196,667 246,149 442,816
Depreciation and equipment replacement funds 816,801 328,765 1,145,566
Unrestricted 10,824,278 298,846 11,123,124
TOTAL NET POSITION $ 57,778,291 $ 25,542,792 $ 83,321,083
See accompanying notes to financial statements.
Page 19
City of Muskego
Statement of Revenues, Expenses
And Changes in Fund Net Position
Proprietary Funds
For the Year Ended December 31, 2013
Business Type Activities
Enter~rise Funds
Total
Sewer Water Enterprise
Utilitl'. Utilitl'. Funds
OPERATING REVENUES
Charges for services $ 6,025,333 $ 1,749,555 $ 7,774,888
Other operating revenues 16,452 128,500 144,952
Total Operating Revenues 6,041,785 1,878,055 7,919,840
OPERATING EXPENSES
Operation and maintenance 5,617,666 730,443 6,348,109
Depreciation 1,116,768 754,943 1,871,711
Taxes 26,152 26,152
Total Operating Expenses 6,734,434 1,511,538 8,245,972
Operating Income (Loss) (692,649) 366,517 (326,132)
NON-OPERATING REVENUES (EXPENSES)
Investment income 22,206 2,443 24,649
Interest income on special assessments 27,954 12,757 40,711
MMSD l&I subsidy 7,509 7,509
l&I MMSD program expenses (7,509) (7,509)
Amortization of bond premium 18,938 18,938
Interest on long term debt (92,201) (205,888) (298,089)
Debt issuance costs (45,332) (24,625) (69,957)
Total Nonoperating Revenues (Expenses) (87,373) (196,375) (283,748)
Income (Loss) before Contributions and Transfers (780,022) 170,142 (609,880)
CAPITAL CONTRIBUTIONS 570,267 396,131 966,398
TRANSFERS-TAX EQUIVALENT (591,036) (591,036)
Change in Net Position (209,755) (24,763) (234,518)
NET POSITION -BEGINNING OF YEAR (Restated) 57,988,046 25,567,555 83,555,601
NET POSITION -END OF YEAR $ 57,778,291 $ 25,542,792 $ 83,321,083
See accompanying notes to financial statements. Page 20
City of Muskego
Statement of Cash Flows
Proprietary Funds
For the Year Ended December 31, 2013
Business Type Activities
Enteq2rise Funds
Total
Sewer Water Enterprise
Utility Utility Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 6,031,950 $ 1,599,404 $ 7,631,354
Receipts from municipality for services 309,000 309,000
Payments to other funds (40,566) (40,566)
Paid to vendor for goods and services (4,756,230) (437,848) (5, 194,078)
Paid to employees for services {790,441) {311,432) p, 101,873)
Net Cash Flows From Operating Activities 444,713 1,159,124 1,603,837
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Paid to municipality for tax equivalent {591,036) {591,036)
Net Cash Flows From Non-Capital Financing Activities {591,036) {591,036)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Debt issued 1,260,000 1,260,000
Debt retired (280,000) (1,857,648) (2, 137,648)
Debt issuance costs paid (24,625) (24,625)
Premium received on debt issued 47,375 47,375
Interest paid (93,835) (205,325) (299, 160)
Special assessments received 303,427 151,668 455,095
Acquisition and construction of capital assets (40,017) (44,058) (84,075)
Connection fees received 22,500 22,500
Net Cash Flows From Capital and
Related Financing Activities {87,925) {672,613) {760,538)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment income
Interest on investments 22,204 2,443 24,647
Interest on special assessments 27,954 12,757 40,711
Investments purchased (735,386) (735,386)
Investments sold and matured 729,320 729,320
Net Cash Flows From Investing Activities 44,092 15,200 59,292
Net Change in Cash and Cash Equivalents 400,880 (89,325) 311,555
CASH AND CASH EQUIVALENTS -Beginning of Year 15,414,711 2,502,562 17,917,273
CASH AND CASH EQUIVALENTS -END OF YEAR $ 15,815,591 $ 2,413,237 $ 18,228,828
See accompanying notes to financial statements. Page 21
City of Muskego
Statement of Cash Flows
Proprietary Funds
For the Year Ended December 31, 2013
(Concluded)
RECONCILIATION OF CASH AND CASH EQUIVALENTS TO THE
STATEMENT OF NET POSITION-PROPRIETARY FUNDS
Current:
Cash and cash equivalents $
Temporary investments
Restricted cash and cash equivaluents
Non-current
Restricted cash and cash equivaluents
Less: Non-cash equivalents
Cash and cash equivalents -end of year $
NON CASH INVESTING, CAPITAL AND RELATED FINANCING ACTIVITIES
Capital additions contributed
to the Utility by customers and developers $
Assessment of benefits for property owners for improvements $
Premium on debt issued for refunding $
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
Depreciation charged to other accounts
(Increase) decrease in assets:
Accounts receivable -other
Prepaid Items
Deferred charge
Increase {decrease) in liabilities:
Accounts payable
Accrued vacation, sick leave and compensatory time
Unearned revenue
Unearned lease revenue
Total adjustments
Net Cash Flows From Operating Activities $
Business Type Activities
Enterprise Funds
Sewer
Utility
9,082,318
735,386
211,489
6,521,784
(735,386)
15,815,591
284,786
262,981
-
$
$
$
$
$
(692,649) $
1, 116,768
(17,344)
(600)
(222,547)
251,924
9,161
1,137,362
444,713 $
Water
Utility
9,635
280,932
2,122,670
2,413,237
273,056
123,075
18,938
366,517
754,943
25,795
{8,591)
(500)
13,790
4,285
(76)
2,961
792,607
1,159,124
$
$
$
$
$
$
$
Total
Enterprise
Funds
9,091,953
735,386
492,421
8,644,454
(735,386)
18,228,828
557,842
386,056
18,938
(326,132)
1,871,711
25,795
(25,935)
(1,100)
(222,547)
265,714
13,446
(76)
2,961
1,929,969
1,603,837
See accompanying notes to financial statements. Page 22
City of Muskego
Statement of Fiduciary Net Position
Fiduciary Funds
As of December 31, 2013
Private Purpose
Trust Funds
Volunteer
Library Fire Co.
Expansion Scholarship Agency
Trust Fund Fund Funds
ASSETS
Cash and cash equivalents $ 49,856 $ 175,915 $ 31,939,742
Accounts receivable, net 39,518
Taxes receivable 4,835,672
Total Assets 49,856 175,915 36,814,932
LIABILITIES
Accounts payable 162,233
Due to other taxing units 36,446,034
Other Deferred Credits 166
Special deposits 206,499
Total Liabilities 36,814,932
NET POSITION
Restricted -held in trust 49,856 175,915
TOT AL NET POSITION $ 49,856 $ 175,915 $
See accompanying notes to financial statements. Page 23
City of Muskego
Statement of Changes in Fiduciary Net Position -Fiduciary Funds
For the Year Ended December 31, 2013
ADDITIONS
Investment income
Total additions
Change in Net Position
NET POSITION -Beginning
NET POSITION -ENDING
Private Purpose
Trust Funds
Library
Expansion
Trust Fund
Volunteer
Fire Co.
Scholarship
Fund
$ 62 $ 176 -'-~~~~~~ -=-~~~~-
62 176
62 176
49 794 175 739
$ 49,856 $ 175,915 ==========
See accompanying notes to financial statements. Page 24
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE
I. Summary of Significant Accounting Policies
A. Reporting Entity
B. Government-Wide and Fund Financial Statements
C. Measurement Focus, Basis of Accounting,
and Financial Statement Presentation
D. Assets, Deferred Outflows of Resources, Liabilities, Deferred
Inflows of Resources and Net Position or Equity
1. Deposits and Investments
2. Receivables
3. Inventories and Prepaid Items
4. Restricted Assets
5. Capital Assets
6. Deferred Outflows of Resources
7. Compensated Absences
8. Long-Term Obligations/Conduit Debt
9. Utility Unearned Revenue
10. Deferred Inflows of Resources
11. Equity Classifications
E. Other Policies-Tax Incremental Districts
II. Reconciliation of Government-Wide and Fund Financial Statements
Explanation of Certain Differences Between the
Governmental Fund Balance Sheet and the Statement of Net Position
Ill. Stewardship, Compliance, and Accountability
A. Budgetary Information
B. Excess Expenditures Over Appropriations
C. Limitations on the City's Tax Levy
IV. Detailed Notes on All Funds
A. Deposits and Investments
B. Restricted Assets
C. Receivables
D. Capital Assets
E. Inter-fund Transfers
F. Long-Term Obligations
G. Net Position I Fund Balances
H. Restatement of Net Position
26
26
27
30
32
32
34
35
35
35
36
37
37
37
38
38
40
41
41
42
42
42
42
43
43
45
46
47
49
50
54
57
V. Other Information 58
A. Employees' Retirement System 58
B. Risk Management 59
C. Commitments and Contingencies 59
D. Water and Sewer Utility Rates 59
E. Antenna Lease Agreements 60
F. Effect of New Accounting Standards on Current Period Financial Statements 61
Page 25
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the City of Muskego, Wisconsin conform to accounting principles
generally accepted in the United State of America as applicable to governmental units. The
accepted standard-setting body for establishing governmental accounting and financial reporting
principles is the Governmental Accounting Standards Board (GASB).
A. REPORTING ENTITY
This report includes all of the funds of the city. The reporting entity for the city consists of the
primary government and its component units. Component units are legally separate organizations
for which the primary government is financially accountable or other organizations for which the
nature and significance of their relationship with the primary government are such that their
exclusion would cause the reporting entity's financial statements to be misleading. The primary
government is financially accountable if (1) it appoints a voting majority of the organization's
governing body and it is able to impose its will on that organization, (2) it appoints a voting
majority of the organization's governing body and there is a potential for the organization to
provide specific financial benefits to, or impose specific financial burdens on, the primary
government, (3) the organization is fiscally dependent on and there is a potential for the
organization to provide specific financial benefits to, or impose specific financial burdens on, the
primary government. Certain legally separate, tax exempt organizations should also be reported
as a component unit if all of the following criteria are met: (1) the economic resources received or
held by the separate organization are entirely or almost entirely for the direct benefit of the
primary government, its component units, or its constituents; (2) the primary government or its
component units, is entitled to, or has the ability to access, a majority of the economic resources
received or held by the separate organization; and (3) the economic resources received or held by
an individual organization that the primary government, or its component units, is entitled to, or
has the ability to otherwise access, are significant to the primary government.
Component units are reported using one of two methods, discrete presentation or blending.
Generally, component units should be discretely presented in a separate column in the financial
statements. A component unit should be reported as part of the primary government using the
blending method if it meets any one of the following criteria: (1) the primary government and the
component unit have substantively the same governing body and a financial benefit or burden
relationship exists, (2) the primary government and the component unit have substantively the
same governing body and management of the primary government has operational responsibility
for the component unit, (3) the component unit serves or benefits, exclusively or almost
exclusively, the primary government rather than its citizens, or (4) the total debt of the component
unit will be paid entirely or almost entirely from resources of the primary government.
Page 26
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Blended Component Units
The City has included in its basic financial statements the Community Development Authority of
the City of Muskego, Wisconsin (authority) as a blended component unit. The authority is legally
separate from the City and governed by a seven member board appointed by the mayor and
confirmed by the common council of the City. Separate financial statements are not published for
the authority. The authority is reported as part of the Non-Major Special Revenue Funds.
The basic financial statements of the City also include the financial data of the City's component
unit, Big Muskego Lake -Bass Bay Protection and Rehabilitation District (district). The City
created the district under certain provisions of the Wisconsin Statutes in order to assist the City in
undertaking programs of lake protection and rehabilitation. The district's governing body is
substantively the same as the City, with all members serving on the City common council and with
the Mayor acting as chairman. Separately issued financial statements for the district may be
obtained from the district's office. The district is reported as part of the Non-Major Special
Revenue Funds.
8. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
In March 2012, the Governmental Accounting Standards Board (GASB) issued Statement No. 65 -Items
Previously Reported as Assets and Liabilities. This statement establishes the accounting and financial
standards that reclassify, as deferred outflows of resources and deferred inflows of resources, certain
items that were previously reported as assets and liabilities and recognizes, as outflows of resources or
inflows of resources, certain items that were previously reported as assets and liabilities. This standard
was implemented effective January 1, 2013.
Government-Wide Financial Statements
The statement of net position and statement of activities display information about the reporting
government as a whole. They include all funds of the reporting entity except for fiduciary funds.
The statements distinguish between governmental and business-type activities. Governmental
activities generally are financed through taxes, intergovernmental revenues, and other non-
exchange revenues. Business-type activities are financed in whole or in part by fees charged to
external parties for goods or services. Likewise, the primary government is reported separately
from certain legally separate component units for which the primary government is financially
accountable.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment is offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. The City does not allocate indirect expenses to
functions in the Statement of Activities. Program revenues include 1) charges to customers or
applicants who purchase, use or directly benefit from goods, services, or privileges provided by a
given function or segment, and 2) grants and contributions that are restricted to meeting the
operational or capital requirements of a particular function or segment. Taxes and other items not
included among program revenues are reported as general revenues. Internally dedicated
resources are reported as general revenues rather than as program revenues.
Page 27
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued)
Fund Financial Statements
Financial statements of the reporting entity are organized into funds, each of which is considered
to be a separate accounting entity. Each fund is accounted for by providing a separate set of self-
balancing accounts, which constitute its assets, deferred outflows of resources, liabilities,
deferred inflows of resources, net position/fund equity, revenues, and expenditure/expenses.
Funds are organized as major funds or non-major funds within the governmental and proprietary
statements. An emphasis is placed on major funds within the governmental and proprietary
categories. A fund is considered major if it is the primary operating fund of the City or meets the
following criteria:
a. Total assets/deferred outflows of resources, liabilities/deferred inflows of resources,
revenues, or expenditures/expenses of that individual governmental or enterprise fund are
at least 10 percent of the corresponding total for all funds of that category or type, and
b. The same element of the individual governmental or enterprise fund that met the 10
percent test is at least 5 percent of the corresponding total for all governmental and
enterprise funds combined.
In addition, any other governmental or enterprise fund that the City believes is particularly important to
financial statement users may be reported as a major fund.
Separate financial statements are provided for governmental funds and proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
The City reports the following major governmental funds:
General Fund -accounts for the City's primary operating activities. It is used to account
for and report all financial resources except those required to be accounted for and
report in another fund.
Debt Service Fund -used to account for and report financial resources that are
restricted, committed, or assigned to expenditures for the payment of general long-
term debt principal, interest, and related costs, other than TIO or enterprise debt.
Tax Increment District Capital Projects Funds -used to account for and report financial
resources that are restricted, committed, or assigned to expenditures for capital
outlays, including the acquisition or construction of capital facilities and other capital
assets for the Tax Increment District #8, 9 and 10.
Capital Budget Fund -used to account for and report financial resources that are
restricted, committed, or assigned to expenditures for capital outlay, including the
acquisition or construction of capital facilities and other capital assets.
Page 28
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued)
Fund Financial Statements (continued)
The City reports the following major enterprise funds:
Sewer Utility -accounts for operations of the sewer system
Water Utility -accounts for operations of the water system
The City reports the following non-major governmental funds:
Special Revenue Funds -used to account for and report the proceeds of specific
revenue sources that are restricted or committed to expenditures for specified
purposes (other than debt service or capital projects).
Parks Recreational Ticket
Sewer Utility Special Debt Service Cable TV
Other Grant Capital Improvements
Refuse/Recycling Community Development Authority
Revolving Loan Federated Library System
Landfill Standing Committee Big Muskego Lake -Bass Bay
Stormwater Management Protection and
Well Testing Reserve Rehabilitation District
Land Open Space Conservation Landfill
Rescue Tax Increment District
Compensated Absences
Capital Projects Funds -used to account for and report financial resources that are
restricted, committed, or assigned to expenditures for capital outlay, including the
acquisition or construction of capital facilities and other capital assets.
Industrial Park Expansion Capital Equipment
FBI Shooting Range
In addition, the City reports the following fund types:
Private-purpose trust funds are used to account for and report any trust arrangement not properly
reported in a pension trust fund under which principal and income benefit the expansion of the
library or scholarships.
Library Expansion Volunteer Fire Co. Scholarship
Agency funds are used to account for and report assets held by the City in a trustee capacity or
as an agent for individuals, private organizations, o.nd/or other governmental units.
Special Deposits Subsequent Years Tax Roll
Police Health Insurance Collections
Page 29
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
c. MEASUREMENT Focus, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION
Government-Wide Financial Statements
The government-wide statement of net position and statement of activities are reported using the
economic resources measurement focus and the accrual basis of accounting. Under the accrual
basis of accounting, revenues are recognized when earned and expenses are recorded when the
liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets, and
liabilities resulting from exchange and exchange-like transactions are recognized when the
exchange takes place. Property taxes are recognized as revenues in the year for which they are
levied. Taxes receivable for the following year are recorded as receivables and unearned
revenue. Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider are met. Special assessments are recorded as revenue
when earned. Unbilled receivables are recorded as revenues when services are provided.
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 the City's water and
sewer utilities and various other functions of the government. Elimination of these charges would
distort the direct costs and program revenues reported for the various functions concerned.
Fund Financial Statements
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recorded when
they are both measurable and available. Available means collectible within the current period or
soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the
City considers revenues to be available if they are collected within 60 days of the end of the
current fiscal period. Expenditures are recorded when the related fund liability is incurred, except
for un-matured interest on long-term debt, claims, judgments, compensated absences, and
pension expenditures, which are recorded as a fund liability when expected to be paid with
expendable available financial resources.
Property taxes are recorded in the year levied as receivables and unearned revenues. They are
recognized as revenues in the succeeding year when services financed by the levy are being
provided.
Intergovernmental aids and grants are recognized as revenues in the period the City is entitled to
the resources and the amounts are available. Amounts owed to the City which are not available
are recorded as receivables and unavailable revenues. Amounts received before eligibility
requirements (excluding time) are met and recorded as liabilities. Amounts received in advance of
meeting time requirements are recorded as deferred inflows.
Special assessments are recorded as revenues when they become measurable and available as
current assets. Annual installments due in future years are reflected as receivables and
unavailable revenues. At December 31, 2013, there were $90,432 and $525,240 in the Sewer
Utility Special Debt Service Fund and the Sewer Utility, respectively, of unrecorded anticipated
future assessments which are not recorded as receivables because collection is subject to certain
events occurring in the future. No formal repayment schedule has been established.
Page 30
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
c. MEASUREMENT Focus, BASIS OF ACCOUNTING,
AND FINANCIAL STATEMENT PRESENTATION (continued)
Fund Financial Statements (continued)
Revenues susceptible to accrual include property taxes, miscellaneous taxes, public charges for
services, special assessments and interest. Other general revenues such as fines and forfeitures,
inspection fees, recreation fees, and miscellaneous revenues are recognized when received in
cash or when measurable and available under the criteria described above.
Proprietary and fiduciary fund financial statements (other than agency funds) are reported using
the economic resources measurement focus and the accrual basis of accounting, as described
previously in this note. Agency funds follow the accrual basis of accounting, and do not have a
measurement focus.
The proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund's principal ongoing operations. The
principal operating revenues of the Water Utility and Sewer Utility are charges to customers for
sales and services. Special assessments are recorded as receivables and contribution revenue
when levied. Operating expenses for proprietary funds include the cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not
meeting this definition are reported as non-operating revenues and expenses.
All Financial Statements
The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenditures/expenses during
the reporting period. Actual results could differ from those estimates.
Page 31
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY
1. Deposits and Investments
For purposes of the statement of cash flows, the City considers all highly liquid investments with
an initial maturity of three months or less when acquired to be cash equivalents.
Investment of City funds is restricted by Wisconsin state statutes. Available investments are
limited to:
1. Time deposits in any credit union, bank, savings bank or trust company maturing in
three years or less.
2. Bonds or securities of any county, city, drainage district, technical college district,
village, town, or school district of the state. Also, bonds issued by a local exposition
district, a local professional baseball park district, a local professional football stadium
district, a local cultural arts district, the University of Wisconsin Hospitals and Clinics
Authority, or the Wisconsin Aerospace Authority.
3. Bonds or securities issued or guaranteed by the federal government.
4. The local government investment pool.
5. Any security maturing in seven years or less and having the highest or second highest
rating category of a nationally recognized rating agency.
6. Securities of an open-end management investment company or investment trust, subject
to various conditions and investment options.
7. Repurchase agreements with public depositories, with certain conditions.
The City's investment of library trust funds is regulated by Chapter 112 of the Wisconsin state
statutes. That section gives broad authority to use such funds to acquire various kinds of
investments including stocks, bonds and debentures.
The City has adopted an investment policy that follows state statues for allowable investments.
The City is exposed to various risks related to their cash and investments. The City's policy
related to these risks is described below:
Custodial Credit Risk
The City's policy indicates that to the extent possible bank balances should be maintained at
amounts less than or equal to the amounts insured by FDIC or State of Wisconsin guaranteed
amounts. (At year end the City had bank balances in excess of insured amounts as disclosed in
Note IV A.) Additionally, all certificates of deposit exceeding these coverage's shall be
collateralized with U.S. securities or Wisconsin municipal debt. Collateral shall be in the City's
name and held by a third party custodian.
Credit Risk
The City's investment policy does not address this risk.
Page 32
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
1. Deposits and Investments (continued)
Interest Rate Risk
The City investment policy only addresses interest rate risk on certificates of deposit and
specifies that they must mature within three years or less from the date of investment.
Investments are stated at fair value, which is the amount at which an investment could be
exchanged in a current transaction between willing parties. Fair values are based on quoted
market prices. No investments are reported at amortized cost. Adjustments necessary to record
investments at fair value are recorded in the operating statement as increases or decreases in
investment income. Investment income on commingled investments of municipal accounting funds
is allocated based on the average investment balance. The difference between the bank balance
and carrying value is due to outstanding checks and/or deposits in transit.
The Wisconsin Local Government Investment Pool (LGIP) is part of the State Investment Fund
(SIF), and is managed by the State of Wisconsin Investment Board. The SIF is not registered with
the Securities and Exchange Commission, but operates under the statutory authority of Wisconsin
Chapter 25. The SIF reports the fair value of its underlying assets annually. Participants in the
LGIP have the right to withdraw their funds in total on one day's notice. At December 31, 2013,
the fair value of the City's share of the LGIP's assets was substantially equal to the amount as
reported in these statements.
PMA Financial Network, Inc. is the administrator for the Wisconsin Investment Series Cooperative
(WISC). The investment manager for WISC is PMA Financial Network, Inc. The WISC is not
registered with the Securities and Exchange Commission, but invests its funds in accordance with
applicable Wisconsin statutes. The WISC has the characteristics of a mutual fund and
accordingly, reports the value of its underlying assets at fair value. At December 31, 2013, the
City's share of the WISC's assets was substantially equal to the amount reported.
Certificate of Deposit Account Registry Service (CDARS) is a member of a special network which
offers access to multi-million dollar FDIC insurance coverage on CD investments through one
bank.
See Note IV.A. for further information.
Page 33
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
2. Receivables
Property taxes are levied in December on the assessed value as of the prior January 1. In
addition to property taxes for the City, taxes are collected for and remitted to the state and county
governments as well as the local school district and technical college district. Taxes for all state
and local governmental units billed in the current year for the succeeding year are reflected as
receivables and due to other taxing units on the accompanying agency fund statement of fiduciary
net position.
Property tax calendar -2013 tax roll:
Lien date and levy date
Tax bills mailed
Payment in full, or
First installment due
Second installment due
Third installment due
Personal property taxes in full
Tax deed by county -2013 delinquent
Real estate taxes
December 2013
December 2013
January 31, 2014
January 31, 2014
April 30, 2014
July 31, 2014
January 31, 2014
October 2016
Accounts receivable have been shown net of an allowance for uncollectible accounts. Delinquent
real estate taxes as of July 31 are paid in full by the county, which assumes the collection thereof.
No provision for uncollectible accounts receivable has been made for the water and sewer utilities
because they have the right by law to place all delinquent bills on the tax roll, and other
delinquent bills are generally not significant.
During the course of operations, transactions occur between individual funds that may result in
amounts owed between funds. Short-term inter-fund loans are reported as "due to and from other
funds." Long-term inter-fund loans (noncurrent portion) are reported as "advances from and to
other funds." Inter-fund receivables and payables between funds within governmental activities
are eliminated in the Statement of Net Position. Any residual balances outstanding between the
governmental activities and business-type activities are reported in the government-wide financial
statements as internal balances.
The City has received state grant funds for economic development loan programs to various
businesses and individuals. The City records a loan receivable when the loan has been made
and funds have been disbursed. The amount recorded as economic development loans
receivable has not been reduced by an allowance for uncollectible accounts.
The Water and Sewer Utilities provide services to customers within the municipal boundaries.
Metered water sales to customers are billed on a quarterly basis at rates approved by the Public
Service Commission of Wisconsin. Sewer customers are billed rates established by the Common
Council. Bills are payable in 30 days. Delinquent balances at the time of the property tax lien date
are placed on the customer's tax bill and collected through the normal tax collection process.
Page 34
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
3. Inventories and Prepaid Items
Governmental fund inventory items are charged to expenditure accounts when purchased. Year-
end inventory was not significant. Proprietary fund inventories are generally used for construction
and for operation and maintenance work. They are not for resale. They are valued at cost based
on weighted average, and charged to construction or operation and maintenance expense when
used.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both government-wide and fund financial statements.
4. Restricted Assets
Mandatory segregations of assets are presented as restricted assets. Such segregations are
required by bond agreements and other external parties. Current liabilities payable from these
restricted assets are so classified. The excess of restricted assets over current liabilities payable
from restricted assets will be used first for retirement of related long-term debt. The remainder, if
generated from earning, is shown as restricted net position. Restricted net position principally
represents Water and Sewer Reserve Capacity Assessment Funds, Special Redemption Funds
and Equipment Replacement Funds restricted assets, less related current liabilities payable from
the restricted assets.
5. Capital Assets
Government-Wide Statements
Capital assets, which include property, plant and equipment, are reported in the government-wide
financial statements. Capital assets are defined by the government as assets with an initial cost of
more than $5,000 for general capital assets and $10,000 for infrastructure assets, and an
estimated useful life in excess of one year. All capital assets are valued at historical cost or
estimated historical cost if actual amounts are unavailable. Donated capital assets are recorded at
their estimated fair value at the date of donation.
Additions to and replacements of capital assets of business-type activities are recorded at original
cost, which includes material, labor, overhead, and an allowance for the cost of funds used during
construction when significant. For tax-exempt debt, the amount of interest capitalized equals the
interest expense incurred during construction netted against any interest revenue from temporary
investment of borrowed fund proceeds. No net interest was capitalized during the current year.
The cost of renewals and betterments relating to retirement units is added to plant accounts. The
cost of property replaced retired or otherwise disposed of, is deducted from plant accounts and,
generally, together with removal costs less salvage, is charged to accumulated depreciation.
Page 35
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
5. Capital Assets (continued)
Government-Wide Statements (continued)
Depreciation of all exhaustible capital assets is recorded as an allocated expense in the
statement of activities, with accumulated depreciation reflected in the statement of net position.
Depreciation is provided over the assets' estimated useful lives using the straight-line method.
The range of estimated useful lives by type of asset is as follows:
Buildings
Land Improvements Other than Building
Machinery and Equipment
Utility System
Infrastructure
Intangibles
Fund Financial Statements
20-50 Years
10-50 Years
3-20 Years
19-125 Years
10-50 Years
5 Years
In the fund financial statements, capital assets used in governmental fund operations are
accounted for as capital outlay expenditures of the governmental fund upon acquisition. Capital
assets used in proprietary fund operations are accounted for the same way as in the government-
wide statements.
6. Deferred Outflows of Resources
A deferred outflow of resources represents a consumption of net position that applies to a future
period and will not be recognized as an outflow of resources (expense/expenditure) until that
future time.
A deferred charge on refunding arise from advance refunding of debt. The difference between the
cost of securities placed in trust for future payment of refunded debt and the net carrying value of
that debt is deferred and amortized as a component of interest expense over the shorter of the
term of the refunding issue or the original term of the refunded debt. The unamortized amount is
reported as a deferred outflow of resources in the government-wide and proprietary fund
statements. Amortization for 2013 was $45,333 for the sewer utility.
Page 36
City of Muskego
Notes to Financial Statements
As of and tor the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
7. Compensated Absences
Under terms of employment, employees are granted sick leave and vacations in varying amounts.
Only benefits considered to be vested are disclosed in these statements.
All vested vacation and sick leave pay are accrued when incurred in the government-wide and
proprietary fund financial statements. A liability tor these amounts is reported in governmental
funds only it they have matured, tor example, as a result of employee resignations and
retirements, and are payable with expendable resources.
Payments tor vacation and sick leave will be made at rates in effect when the benefits are used.
Accumulated vacation and sick leave liabilities at December 31, 2013 are determined on the basis
of current salary rates and include salary related payments.
8. Long-Term Obligations/Conduit Debt
All long-term obligations to be repaid from governmental and business-type resources are
reported as liabilities in the government-wide statements. The long-term obligations consist
primarily of notes and bonds payable, and accrued compensated absences.
Long-term obligations tor governmental funds are not reported as liabilities in the fund financial
statements. The face value of debts (plus any premiums) is reported as other financing sources
and payments of principal and interest are reported as expenditures. The accounting in
proprietary funds is the same as it is in the government-wide statements.
For the government-wide statements and proprietary fund statements, bond premiums and
discounts are deferred and amortized over the lite of the issue using the effective interest method.
Gains or losses on prior refunding bonds are amortized over the remaining lite of the old debt, or
the life of the new debt, whichever is shorter. The balance at year end tor both
premiums/discounts is shown as an increase or decrease in the liability section of the statement
of net position. The balance at year end tor gains/losses is shown as a deterred outflow/inflow in
the statement of net position.
The City may approve the issuance of industrial revenue bonds (IRB) tor the benefit of private
business enterprises. IRB's are secured by mortgages or revenue agreements on the associated
projects, and do not constitute indebtedness of the City. Accordingly, the bonds are not reported
as liabilities in the accompanying financial statements. At December 31, 2013, there were no
series of IRBs outstanding.
9. Utility Unearned Revenue
Unearned revenue principally represents unearned special assessments which will be reported as
contributed capital when and if the property owner connects to the water system and the
assessment becomes due, and prepayments of reserve capacity assessments.
Page 37
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
10. Deferred Inflows of Resources
A deferred inflow of resources represents an acquisition of net position that applies to a future
period and therefore will not be recognized as an inflow of resources (revenue) until that future
time.
11. Equity Classifications
Government-Wide Statements
Equity is classified as net position and displayed in three components:
a. Net investment in capital assets -Consists of capital assets including restricted capital
assets, net of accumulated depreciation and reduced by the outstanding balances
(excluding unspent bond proceeds) of any bonds, mortgages, notes, or other
borrowings that are attributable to the acquisition, construction, or improvement of
those assets.
b. Restricted net position -Consists of net position with constraints placed on the use
either by 1) external groups such as creditors, grantors, contributors, or laws or
regulations of other governments or, 2) law through constitutional provisions or
enabling legislation.
c. Unrestricted net position -All other net positions that do not meet the definition of
"restricted" or "net investment in capital assets."
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as they are needed.
The net position section includes an adjustment of $1.49 million for capital assets owned by the
business type activities, but financed by the governmental activities. The amount is a reduction of
the "net investment in capital assets", and an increase in the "unrestricted" net position, shown
only in the total column.
Page 38
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
11. Equity Classifications (continued)
Fund Statements
Governmental fund equity is classified as fund balance and displayed as follows:
a. Non-spendable -Includes fund balance amounts that cannot be spent either because
they are not in spendable form or because legal or contractual requirements require
them to be maintained intact.
b. Restricted -Consists of fund balances with constraints place on their use either by 1)
external groups such as creditors, granters, contributors, or laws or regulations of
other governments or 2) law through constitutional provisions or enabling legislation.
c. Committed -Includes fund balance amounts that are constrained for specific purposes
that are internally imposed by the government through formal action of the highest
level of decision making authority. Fund balance amounts are committed through a
formal action (resolution) of the city. This formal action must occur prior to the end of
the reporting period, but the amount of the commitment, which will be subject to the
constraints, may be determined in the subsequent period. Any changes to the
constraints imposed require the same formal action of the city that originally created
the commitment.
d. Assigned -Includes spendable fund balance amounts that are intende.d to be used for
specific purposes that are not considered restricted or committed. Fund balance may
be assigned through the following; 1) The city has adopted a financial policy
authorizing the Finance Committee to assign amounts for a specific purpose. 2) All
remaining positive spendable amounts in governmental funds, other than the general
fund, that are neither restricted nor committed. Assignments may take place after the
end of the reporting period.
e. Unassigned -Includes residual positive fund balance within the general fund which has
not been classified within the other above mentioned categories. Unassigned fund
balance may also include negative balances for any governmental fund if expenditures
exceeds amounts restricted, committed, or assigned for those purposes.
The City considers restricted amounts to be spent first when both restricted and unrestricted fund
balance is available unless there are legal documents I contracts that prohibit doing this, such as
in grant agreements requiring dollar for dollar spending. Additionally, the City would first use
committed, then assigned and lastly unassigned amounts of unrestricted fund balance when
expenditures are made.
The City has a formal minimum fund balance policy. That policy is to maintain an unassigned fund
balance in the general fund of $2,446,256, or 17% of the ensuing year's budgeted general fund
expenditures. The balance at year end was $3,348,747 or 23% of 2014 budgeted general fund
expenditures.
Proprietary fund equity is classified the same as in the government-wide statements.
Page 39
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION OR EQUITY (continued)
11. Equity Classifications (continued)
Fund Statements (continued)
Fiduciary fund equity is classified as held in trust for the Library Expansion Trust and the
Volunteer Fire Co. Scholarship on the statement of fiduciary net position. Various donor
restrictions apply, including authorizing and spending trust income, and the City believes it is in
compliance with all significant restrictions.
E. OTHER POLICIES -TAX INCREMENTAL DISTRICTS
The City has created a number of "City of Muskego Tax Incremental Districts" to encourage
development of the City tax base, efficient use of land, buildings and public improvements and
private investment in various specific areas of the City. Property taxes of each specific District
generated in future years, measured by the increment in value of the property in the district over
the base year, will be used to retire the interest and principal of the related debt incurred to
finance the project costs. Below is a summary of each district:
1. District No. 8 was created in 2000 and is for the development of the City's downtown
area. Project costs were originally estimated at $2.7 million. In September, 2005 the
City amended the project plan to include an additional $855,000 in project costs.
2. District No. 9 was created in 2003 for development in the City's Community
Development Authority Redevelopment District No. 1. Project costs were estimated
at $1.5 million and have been financed with a $2.0 million Community Development
Lease Revenue Bond.
3. District No. 10 was created in 2007 and is a mixed use tax increment district
comprised of the east and west sides of Moorland Road from College Avenue on the
north to one-half mile south. Project costs were estimated at $8.3 million and have
been financed with $8.9 million bonds.
Page 40
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE II -RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUND BALANCE SHEET AND THE STATEMENT OF NET POSITION
The governmental fund balance sheet includes reconciliation between fund balance -total
governmental funds and net position -governmental activities as reported in the government-wide
statement of net position. The details of this reconciliation include the following items.
Capital assets used in governmental funds are not financial resources and, therefore, are not
reported in the funds.
Land $ 5,539,936
Intangibles
Construction in progress
Land improvements
Buildings
Machinery and equipment
Library collection
Infrastructure
Less: Accumulated depreciation
Adjustment for Capital Assets
221,580
4,465,877
3,930,454
13,196,365
7,571,300
2,812,983
62,178,263
(43,404,251)
$ 56,512,507
Long-term liabilities applicable to the City's governmental activities are not due and payable in the
current period, and accordingly, are not reported as fund liabilities. Interest on long-term debt is
not accrued in governmental funds, but rather is recognized as an expenditure when due. All
liabilities-both current and long-term-are reported in the statement of net position.
Bonds and notes payable
Compensated absences
Unamortized debt premium
Accrued interest
Combined Adjustment for Long-Term Liabilities
$ 31,077,425
3,415,400
901,620
219,720
$ 35,614,165
Page 41
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE Ill -STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. BUDGETARY INFORMATION
Budgetary information is derived from the annual operating budget and is presented using the
same basis of accounting for each fund as described in Note l.C.
A budget has been adopted for the General Fund, certain Special Revenue Funds, Debt Service
Funds, certain Capital Project Funds, the Water Utility and Sewer Utility. Budgets have not been
formally adopted for other certain Special Revenue Funds and Capital Project Funds, and for
Agency Funds. Wisconsin Statute 65.90 requires that an annual budget be adopted for all funds.
Appropriations lapse at year end unless specifically carried over by the Common Council. There
were no carryovers to the following year. Budgetary control is exercised at the fund level for all
funds.
8. EXCESS EXPENDITURES OVER APPROPRIATIONS
Expenditures exceeded appropriations due to the unbudgeted costs in the following funds. The
excess expenditures were covered by additional revenues received or use of available fund
balance.
Fund
Capital Projects Fund
Capital Budget
Debt Service Fund
Debt Service
Special Re\enue Funds
Park
Compensated Absences
Land & Open Space Conservation
Capital lmpro\ement
Tax Increment District
Budgeted
Expenditures
$ 1,748,000
3,025,544
1,798,410
107,650
132,544
19,000
20,000
C. LIMITATIONS ON THE CITY'S TAX LEVY
Excess
Actual Expenditures
Expenditures O\er Budget
$ 2,882, 121 $ 1,134,121
26,488,261 23,462,717
1,903,952 105,542
141,964 34,314
138,571 6,027
37,693 18,693
410,485 390,485
Wisconsin law limits the City's future tax levies. Generally, the City is limited to its prior tax levy
dollar amount (excluding TIF Districts), increased by the greater of the percentage change in the
City's equalized value due to new construction or zero percent. Changes in debt service from one
year to the next are generally exempt from this limit with certain exceptions. The City is required
to reduce its allowable levy by the estimated amount of fee revenue it collects for certain services,
if those services were funded in 2013 by the property tax levy. Levies can be increased above
the allowable limits if the amount is approved by referendum.
Page 42
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS
A. DEPOSITS AND INVESTMENTS
The City's cash and investments at year end were comprised of the following:
Deposits with banks
LGIP
$
Carrying
Value
54,352,303
16,533,015
414,033
Bank
Balance
$ 47,844,049
16,533,015
414,033
Associated
Risks
Custodial Credit Risk
Credit Risk
Credit and Interest Rate
Risk Wisconsin Investment Series Cooperative (WISC)
Petty cash 2,485 -None
Total Cash and Investments
Reconciliation to financial statements
Per statement of net position
Unrestricted cash and investments
Temporary investments
Restricted cash and investments
Per statement of net position -Fiduciary Funds
Library expansion trust
Volunteer Fire-Co. Scholarship
Agency
Total Cash and Investments
$ 71,301,836 $ 64,791,097
$ 29,264,062
735,386
9,136,875
49,856
175,915
31,939,742
$ 71,301,836
Deposits in each local and area bank are insured by the FDIC in the amount of $250,000 for time
and savings accounts (including NOW accounts) and $250,000 for demand deposit accounts
(interest-bearing and noninterest-bearing). In addition, if deposits are held in an institution
outside of the state in which the government is located, insured amounts are further limited to a
total of $250,000 for the combined amount of all deposit accounts.
Bank accounts are also insured by the State Deposit Guarantee Fund in the amount of $400,000.
However, due to the nature of this fund, recovery of material principal losses may not be
significant to individual municipalities. This coverage has been considered in computing custodial
credit risk.
Page 43
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
A. DEPOSITS AND INVESTMENTS (continued)
Custodial Credit Risk
Deposits
Custodial credit risk is the risk that in the event of a financial institution failure, the City's deposits
may not be returned to the City.
As of December 31, 2013, $687, 114 of the City's total bank balances of $47,844,049 was exposed
to custodial credit risk as uninsured and uncollateralized.
Investments
For an investment, custodial credit risk is the risk that, in the event of the failure of the
counterparty, the City will not be able to recover the value of its investments or collateral
securities that are in the possession of an outside party.
The City does not have any investments exposed to custodial credit risk.
Credit Risk
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its
obligation.
The City had investments in the external Wisconsin Local Government Investment Pool and
Wisconsin Investment Series Cooperative, which are not rated.
Interest Rate Risk
Interest rate risk is the risk that changes in interest rate will adversely affect the value of an
investment.
As of December 31, 2013 the City investments were as follows:
Investment Maturities (in years)
Less than 1-3
Investment Type Fair Value 1 Year Years
WISC $ 414,033 ==$====-==$ ==4=14==,0=3=3
See Note l.D.1. for further information on deposit and investment policies.
Page 44
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
B. RESTRICTED ASSETS
The following represent the balances of the restricted assets:
Liabilities Payable
from Restricted
Restricted Assets and Restricted
Assets Other Liabilities Net Position
Sewer Utility
Cash and investments
Redemption account $ 211,489 $ 14,822 $ 196,667
Reserve account 380,950 295,000 -(1)
Equipment replacement 816,801 816,801
Reserve capacity assessments 5,324,033 5,324,033
RCA assessments receivable 263,235 263,235
Total Sewer Utility 6,996,508 309,822 6,600,736
Water Utility
Cash and investments
Redemption account 280,932 34,783 246,149
Reserve account 636,824 507,286 -(1)
Depreciation account 328,765 328,765
Construction funds 713,875 37,281 -(1)
Reserve capacity assessments 443,206 443,206
WCA assessments receivable 104,615 6,064 98,551
Total Water Utility 2,508,217 585,414 1,116,671
Total Business-type Activities $ 9,504,725 $ 895,236 $ 7,717,407
(1) -Reserve accounts and Construction funds consist of bond proceeds and are not a
component of net position.
Below are descriptions of restricted assets:
Long Term Debt Accounts
Redemption Used to segregate resources accumulated for debt service payments
over the next twelve months.
Reserve Used to report resources set aside to make up potential future
deficiencies in the redemption account.
Depreciation -Used to report resources set aside to fund plant renewals and
replacement or make up potential future deficiencies in the redemption
account.
Construction -Used to report proceeds of revenue bond issuances that are restricted
for use in construction.
Page 45
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
B. RESTRICTED ASSETS (continued)
Water and Sewer Capacity Assessments Account
The water and sewer utilities established funds to account for capacity assessment levies that are
restricted to finance certain system capital costs or related debt service costs.
Equipment Replacement Account
The sewer utility established an equipment replacement account to be used for significant
mechanical equipment replacement as required by the Wisconsin Department of Natural
Resources and debt covenants.
C. RECEIVABLES
Governmental funds report unavailable or unearned revenue in connection with receivables for
revenues that are not considered to be available to liquidate liabilities of the current period.
Property taxes levied for the subsequent year are not earned and cannot be used to liquidate
liabilities of the current period. Governmental funds also defer revenue recognition in connection
with resources that have been received, but not yet earned. At the end of the current fiscal year,
the various components for unavailable revenue and unearned revenue reported in the
governmental funds were as follows:
Unearned Unavailable
Property taxes receivable for subsequent year $ 13,512,507 $
Other 4
Program revenue collected in advance 65,569
Total Unearned/Unavailable Revenue
for Governmental Funds $ 13,578,080 $
Unearned revenue included in liabilities $ 65,569
Unearned revenue included in deferred inflows 13,512,511
Total Unearned Revenue for Governmental
Funds $ 13,578,080
Significantly all governmental activities receivables are expected to be collected within one year.
Page 46
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
D. CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2013 was as follows:
Governmental Activities
Beginning Ending
Balance Additions Deletions Balance
Capital assets not being depreciated/amortized
Land $ 5,533,922 $ 6,014 $ -$ 5,539,936
Construction in progress 2,859,682 3,122,187 1,515,992 4,465,877
Total capital assets not being
depreciated 8,393,604 3,128,201 1,515,992 10,005,813
Capital assets being depreciated/amortized
Intangibles 207,430 14, 150 221,580
Land improvements 3,944,754 14,300 3,930,454
Buildings 13, 196,365 13,196,365
Machinery and equipment 7,272,487 689,326 390,513 7,571,300
Library collection 2,669,657 143,326 2,812,983
Infrastructure 59,262,681 2,915,582 62,178,263
Total Capital Assets
Being Depreciated/ Amortized 86,553,374 3,762,384 404,813 89,910,945
Less: Accumulated depreciation/amortization for
Intangibles (46,375) (43,887) (90,262)
Land improvements (1,814,760) (136,759) (1,951,519)
Buildings (5, 135,695) (319,774) (5,455,469)
Machinery and equipment (5,077,955) (488,562) 337,362 (5,229,155)
Library collection (2,220,464) (161,510) (2,381,974)
Infrastructure {26,282,253) {2,013,619) {28,295,872)
Total Accumulated Depreciation {40,577,502) (3, 164, 111) 337,362 {43,404,251)
Net Capital Assets
Being Depreciated 45,975,872 598,273 67,451 46,506,694
Total Governmental Activities
Capital Assets, Net of Depreciation $ 54,369,476 $ 3,726,474 $1,583,443 $ 56,512,507
Page 47
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
D. CAPITAL ASSETS (continued)
Depreciation expense was charged to functions as follows:
Governmental Activities
General government
Public safety
Public works, which includes the depreciation of
infrastructure
Economic development
Education and recreation
Total Governmental Activities Depreciation Expense
Business Type Activities
Capital Assets not being deprectiated
Land and easements
Construction in progress
Total Capital Assets
Not Being Depreciated
Capital Assets being deprectiated
Buildings and improvements
Improvements other than buildings
Machinery and equipment
Total Capital Assets
Being Depreciated
Less: Accumulated Depreciation
Buildings and improvements
Improvements other than buildings
Machinery and equipment
Total Accumulated Depreciation
$
Beginning
Balance Additions
196,566 $ -
487,174 214,234
683,740 214,234
20,186,877
73,719,544 884,836
4,375,805 95,237
98,282,226 980,073
(8,900,789) (744,487)
(14,740,742) (931,922)
(3, 103,937) (221,097}
(26,745,468) (1,897,506}
$
$ 189,522
259,855
2,137,376
107,294
470,064
$ 3, 164,111
Ending
Deletions Balance
- $ 196,566
326,993 374,415
326,993 570,981
20,186,877
74,604,380
3,960 4,467,082
3,960 99,258,339
(9,645,276)
(15,672,664)
3,960 (3,321,074)
3,960 (28,639,014)
Net Capital Assets
Being Depreciated 71,536,758 (917,433} -----70,619,325
Total Business Activities
Capital Assets, Net
of Depreciation $ 72,220,498 $ (703, 199} $ 326,993 $ 71, 190,306
Page 48
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
D. CAPITAL ASSETS (continued)
Depreciation/amortization expense was charged to functions as follows:
Business-Type Activities
Sewer utility
Water utility
$ 1,116,768
754,943
Total Business-Type Activities Depreciation/ Amortization
Expense $ 1,871,711
Depreciation/amortization expense may be different from business-type activity capital asset
additions because of joint metering, salvage, cost of removal, internal allocations, or costs
associated with the disposal of assets.
E. INTER-FUND TRANSFERS
The following is a schedule of inter-fund transfers:
Fund Transferred To Fund Transferred From ~~~---'~~~~~~~~-
Gener a I Fund Water Utility
Debt Service Fund Nonmajor Governmental Funds
Debt Service Fund Capital Budget Fund
Nonmajor Governmental Funds Nonmajor Governmental Funds
Subtotal -Fund Financial Statements
Less: Fund eliminations
Total Transfers -Government-Wide
Statement of Activities
Amount Princi12al Pur12ose
$ 591,036 Payment in lieu of taxes
839,486 Debt service requirements
200,000 Debt service requirements
CDA debt service and capital
2,905,190 improvements
4,535,712
(3,944,676)
$ 591,036
Generally, transfers are used to (1) move revenues from the fund that collects them to the fund
that the budget requires to expend them, (2) move receipts restricted to debt service from the
funds collecting the receipts to the debt service fund, and (3) use unrestricted revenues collected
in the general fund to finance various programs accounted for in other funds in accordance with
budgetary authorizations.
For the statement of activities, inter-fund transfers within the governmental or business-type
activities are netted and eliminated.
Page 49
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
F. LONG-TERM DBL/GA TIONS
General Obligation Debt
Long-term obligations activity for the year ended December 31, 2013 was as follows:
Beginning
Balance Increases Decreases
Ending
Balance
Amounts
Due Within
One Year
GOVERNMENTAL ACTIVITIES
Bonds and Notes Payable
General obligation debt
Community development
lease revenue bonds
Unamortized debt premium
$ 32,334,940 $ 22,240,000 $ 23,497,515 $ 31,077,425 $ 2,023,415
Total Bonds and Notes Payable
Other Liabilities
Accrued compensted absences -
vacation and sick leave
1,440,000
901,620
33,774,940 23, 141,620
3,363,879 183,397
1,440,000
901,620
24,937,515 31,979,045 2,023,415
131,876 3,415,400 132,000
Total Governmental Activities
Long-Term Liabilities $ 37, 138,819 $ 23,325,017 $ 25,069,391 $ 35,394,445 $ 2, 155,415
BUSINESS-TYPE ACTIVITIES
Bonds and Notes Payable
Revenue Bonds
Revenue Refunding Bonds
General obligation debt
Wisconsin Safe Drinking Water Loan
Unamortized debt premium
Total Business-type Activities
Long-Term Liabilities
$
$
4,730,000 $ -
2,365,000
1,565,060 1,260,000
426,664
73,081 47,375
9,159,805 $ 1,307,375
$ 380,000 $ 4,350,000 $
375,000 1,990,000
1,362,485 1,462,575
20,163 406,501
18,938 101,518
$ 2,156,586 $ 8,310,594 $
All general obligation notes and bonds payable are backed by the full faith and credit of the City.
Notes and bonds in the governmental funds will be retired by future property tax levies or tax
increments accumulated by the debt service fund. Business-type activities debt is payable by
revenues from user fees of those funds or, if the revenues are not sufficient, by future tax levies.
In accordance with Wisconsin Statutes, total general obligation indebtedness of the City may not
exceed 5% of the equalized value of taxable property within the City's jurisdiction. The debt limit
as of December 31, 2013, was $126.7 million. Total general obligation debt outstanding at year
end was $32,540,000.
Page 50
395,000
275,000
111,585
20,701
802,286
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
F. LONG-TERM OBLIGATIONS (continued)
General Obligation Debt
Governmental Activities
General Obligation Debt
Promissory notes
Refunding Debt
Refunding Debt
Refunding Debt
Promissory notes
Corporate purpose bonds
Refunding Debt
Date of Interest
Issue Rate
3/1/05 2.60-3.70
6/1/06 4.00-4.25
4/27/10 2.50-4.75
4/27/10 4.00-6.50
10/22/13 2.00-4.00
10/22/13 2.00-3.125
11 /26/13 1.00-3.00
Total Governmental Activities -General Obligation Debt
Principal
Payable
3/1/06-15
6/1/07-17
5/1/12-24
5/1/12-18
4/1/14-31
4/1/14-23
4/1/14-22
Interest
Payable
3/1& 9/1
6/1&12/1
4/1& 10/1
4/1& 10/1
4/1& 10/1
4/1& 10/1
4/1& 10/1
$
Original
Amount
985,000
5,160,000
5,575,000
815,000
11,805,000
885,000
9,550,000
$
Balance
12/31/13
332,425
2,555,000
5,325,000
625,000
11,805,000
885,000
9.550.000
$ 31,077,425
Date of Interest Principal Interest Original Balance
Issue Rate Patable Patable Amount 12/31/13
Business-type activities
General obligation debt 3/1/05 2.60-3.70 3/1/06-15 3/1 & 9/1 $ 600,000 $ 202,575
General obligation debt 10/22/13 2.00-4.00 4/1/14-31 4/1 & 10/1 820,000 820,000
General obligation debt 10/22/13 2.00-3.125 4/1/14-23 4/1 & 10/1 440,000 440,000
Total Business-Type Activities $1,462,575
Debt service requirements to maturity are as follows:
Governmental Type Business Type
Long-Term Debt Long-Term Debt
Princi~al Interest Princi~al Interest
2014 $ 2,023,415 $ 989, 151 $ 111,585 $ 48,838
2015 2,110,910 1,001,210 114,090 47,590
2016 2,123,600 939,941 31,400 45,417
2017 2,145,225 879,134 29,775 44,805
2018 2,022,300 814,563 52,700 44,064
2019-2023 10,538,350 2,935,600 486,650 187,933
2024-2028 6,326,250 1,424,541 373,750 97,713
2029-2031 3,787,375 230,945 262,625 16,055
Totals $ 31,077,425 $ 9,215,085 $ 1,462,575 $ 532,415
Page 51
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
F. LONG-TERM OBLIGATIONS (continued)
Other Debt Information
Estimated payments of compensated absences are not included in the debt service requirement
schedules. The compensated absences liability attributable to governmental activities will be
primarily liquidated by the general fund.
Water and Sewer System Revenue Bonds
The Water and Sewer Utilities have $6,340,000 in Water and Sewer System Revenue Bonds
outstanding at December 31, 2013. The bonds are not general obligations of the City of Muskego
and are payable from a first pledge of the income and revenues derived from the operations of the
systems in accordance with the resolution adopted in conjunction with the issuance of the debt.
The resolution creates a statutory mortgage lien upon the systems and its revenues in accordance
with Section 66 of Wisconsin Statutes. The utilities have established certain funds, as described
in the resolution, to account for the allocation of each utility's gross revenue and have deposited
funds in compliance with the bond covenants.
Revenue bonds payable at December 31, 2013 consists of the following:
Date of
Issue
Interest
Rate
Principal
Payable
Interest
Payable
Original
Amount
Balance
12/31/13
Sewer Utility
Revenue Bonds 3/1/05 3.50-4.00% 5/1/06-20 5/1&11/1 $ 4,225,000 $ 2,300,000
Water Utility
Revenue Bonds
Revenue Refunding Bonds
9/1/08
11/8/11
3.5-5.25 5/1/09-28 5/1&11/1
2.0-4.00 5/1/12-20 5/1&11/1
Total Business-Type Activities Revenue Debt
2,450,000
2,740,000
2,050,000
1,990,000
$ 6,340,000
Page 52
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
F. LONG-TERM OBLIGATIONS (continued)
Water and Sewer System Revenue Bonds (continued)
Debt service requirements to maturity are as follows:
2014
2015
2016
2017
2018
2019-2023
2024-2028
Totals
Business-type Activities
Revenue Debt
Principal Interest
$ 670,000 $ 232,919
705,000 212,216
720,000 190,494
755,000 166,104
785,000 138,606
1,855,000 354,911
850,000 118, 126
$ 6,340,000 $ 1,413,376 ==============
The total principal and interest paid during the year on the Sewer System Revenue Bonds was
$373,835 and on the Water Revenue Bonds was $802,973. The revenues as defined by the
respective bond covenants for the same period were $1.045 million for the Sewer Utility and
$1.535 million for the Water Utility. Annual principal and interest payments are expected to
require 40% of the net revenues for the Sewer Utility and 23% of the net revenues for the Water
Utility.
Current Refunding
On November 26, 2013, the City issued $9,550,000, in general obligation notes with an average
coupon rate of 2.44% to refund $9,905,000 of outstanding notes with an average coupon rate of
3.93%. The net proceeds along with existing funds of the city were used to prepay the outstanding
debt.
The cash flow requirements on the refunded debt prior to the current refunding was $11,933,748
from 2013 through 2022. The cash flow requirements on the refunding bonds are $10,624, 182
from 2013 through 2022. The current refunding resulted in an economic gain (difference between
the present values of the debt service payments on old and new debt) of $963,498.
Page 53
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
G. NET POSITION I FUND BALANCES
Governmental Activities
Net position reported on the government wide statement of net position at December 31, 2013
includes the following:
Net investment in capital assets
Land $ 5,539,936
Other capital assets, net of accumulated depreciation 46,506,694
Construction in progress 4,465,877
Less: related long-term debt outstanding (31,077,425)
Less: unamortized debt premium (901,620)
Plus: unspent capital related debt proceeds 1,710,555
Plus: non-capital debt proceeds 3,177,532
Total Net investment in capital assets 29,421,549
Resticted for:
Tax Increment District purposes 821,217
Other debt service 2,314,452
Total Restricted Net Position 3,135,669
Unrestricted 7,805,538
Total Governmental Activities Net Position $ 40,362,756
Page 54
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
G. NET POSITION I FUND BALANCES (continued)
Governmental Funds
Governmental fund balances reported on the fund financial statements at December 31, 2013
include the following:
Nonspendable
Major Fund
General Fund
Prepaid items $ 48,269
Total Major Fund 48,269
Nonmajor Funds
Special ReV€nue Funds
Park Fund -prepaid items 14,000
Land Open Space Conservation Fund -prepaid items 225
Total Nonmajor Funds 14,225
Total Nonspendable Fund Balance $ 62,494
Restricted
Major Funds
Debt Service Fund $ 2,534, 172
Capital Projects Fund -Tax Increment District
Project costs and debt service 366,656
Total Major Funds 2,900,828
Nonmajor Fund
Special ReV€nue Fund
Sewer Utility Special Debt Service Fund 61,528
Tax Increment District Funds 428,775
Total Nonmajor Funds 490,303
Total Restricted Fund Balance $ 3,391,131
Committed
Major Fund
General Fund
Unfunded portion of accrued compensated absences $ 2,869,645
Total Major Fund 2,869,645
Page 55
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
G. NET POSITION I FUND BALANCES (continued)
Governmental Funds (continued)
Committed (continued)
Nonmajor Funds
Special Re>venue Funds
Park Fund
Other Grant Fund
Refuse I Recycling Fund
Re\Olving Loan Fund
Landfill Standing Committee Funds
Stormwater Management Fund
Well Testing Reser\€ Fund
Land Open Space Conservation Fund
Compensated Absences Fund
Recreational Ticket Fund
Cable TV Fund
Capital lmpro>vements Fund
Community De>velopment Authority Fund
Federated Library System Fund
Big Muskego Lake -Bass Bay Protection and Rehabilitation District
Landfill Fund
Total Nonmajor Funds
Total Committed Fund Balance
Assigned
Major Fund
Capital Budget Fund
Total Major Fund
Nonmajor Funds
Capital Projects Funds
Industrial Park Expansion Fund
FBI Shooting Range
Capital Equipment Fund
Total Nonmajor Funds
Total Assigned Fund Balance
$
$
$
$
338,000
10,950
710,899
281,364
72,520
368,979
505,225
118,820
545,755
6,231
138,551
800,801
191,007
119,590
99,665
3,056,672
7,365,029
10,234,674
1,623,902
1,623,902
16,520
9,102
777,844
803,466
2,427,368
Page 56
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE IV -DETAILED NOTES ON ALL FUNDS (continued)
G. NET POSITION I FUND BALANCES (continued)
Governmental Funds (continued)
Unassigned
Major Fund
General Fund
Total Unassigned Fund Balance
$ 3,348,747
$ 3,348,747
Net position reported on the government wide statement of net position at December 31, 2013
includes the following:
Business-type Activities
Net Investment in Capital Assets
Land and easements
Other capital assets, net of accumulated depreciation
Construction in progress
Less: related long-term debt outstanding
Add: unspent capital related debt proceeds
Add: Non-capital debt proceeds
Total Net Investment in Capital Assets
Resticted for:
Debt service
Depreciation and equipment replacement funds
Water and sewer capacity assessment funds
Total Restricted Net Position
Unrestricted
Total Business-type Activities Net Position
H. RESTATEMENT OF NET POSITION
$ 196,566
70,619,325
374,415
(8, 156, 188)
530,178
916,256
64,480,552
442,816
1,145,566
6,129,025
7,717,407
11,123,124
$ 83,321,083
Net position has been restated as a result of the implementation of GASB Statement No. 65,
Items Previously Reported as Assets and Liabilities, which requires debt issuance costs to be
expensed in the period incurred. These costs were previously required to be capitalized. The
details of this restatement are as follows:
Governmental Sewer Water Business-type
Activities Utility Utility Activities
Net Position -December 31, 2012
(as reported) $ 41,159,865 $ 58,030,635 $ 25,642,489 $ 83,673,124
Less: Unamortized debt issuance
costs (53,250) (42,589) (74,934) (117,523)
Net Position -December 31, 2012
(as restated) $ 41,106,615 $ 57,988,046 $ 25,567,555 $ 83,555,601
Page 57
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE V -OTHER INFORMATION
A. EMPLOYEES' RETIREMENT SYSTEM
All eligible City of Muskego employees participate in the Wisconsin Retirement System (WRS), a
cost-sharing, multiple employer, defined benefit, public employee retirement system. All
employees initially employed by a participating WRS employer prior to July 1, 2011, expected to
work at least 600 hours a year and expected to be employed for at least one year from
employee's date of hire, are eligible to participate in the WRS. All employees initially employed by
a participating WRS employer on or after July 1, 2011, and expected to work at least 1200 hours a
year, and expected to be employed for at least one year from employee's date of hire are eligible
to participate in the WRS.
Effective the first day of the first pay period on or after June 29, 2011, the employee required
contribution was changed to one-half of the actuarially determined contribution rate for employees
in the General Employment category, including Teachers, and Executives and Elected Officials.
Required contributions for protective contributions are the same rate as general employees.
Employers are required to contribute the remainder of the actuarially determined contribution rate.
The employer may not pay the employee required contribution unless provided for by an existing
collective bargaining agreement.
Contribution rates for 2013 were:
General
Executives and Elected Officials
Protective with Social Security
Protective without Social Security
Employee
6.65%
7.00%
6.65%
6.65%
Employer
6.65%
7.00%
9.75%
12.35%
The payroll for City of Muskego employees covered by the WRS for the year ended December 31,
2013 was $7, 142,387; the employer's total payroll was $7,511,899. The total required contribution
for the year ended December 31, 2013 was $1,228,548, which consisted of $752,285, or 10.5% of
payroll from the employer and $476,263, or 6.7% of payroll from employees. Total contributions
for the years ending December 31, 2012 and 2011 were $1,075,852 and $883,560, respectively,
equal to the required contributions for each year.
Employees who retire at or after age 65 (62 for elected officials and 54 for protective occupation
employees with less than 25 years of service, 53 for protective occupation employees with more
than 25 years of service) are entitles to receive a retirement benefit. Employees may retire at age
55 (50 for protective occupation employees) and receive actuarially reduced benefits. The factors
influencing the benefit are: (1) final average earnings, (2) years of creditable service and (3) a
formula factor. A final average earnings is the average of the employee's three highest years'
earnings. Employees terminating covered employment and submitting application before
becoming eligible for a retirement benefit may withdraw their contributions and, by doing so,
forfeit all rights to any subsequent benefit. For employees beginning participation on or after
January 1, 1990 and no longer actively employed on or after April 24, 1998, creditable service in
each of five years is required for eligibility for a retirement annuity. Participants employed prior to
1990 and on or after April 24, 1998 and prior to July 1, 2011 are immediately vested. Participants
who initially became WRS eligible on or after July 1, 2011 must have five years of creditable
service to be vested.
Page 58
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE v -OTHER INFORMATION (continued)
A. EMPLOYEES' RETIREMENT SYSTEM (continued)
The System also provides death and disability benefits for employees. Eligibility for and the
amount of all benefits is determined under Chapter 40 of Wisconsin Statutes.
The System issues an annual financial report which may be obtained by writing to the Department
of Employee Trust Funds, P.O. Box 7931, Madison, WI 53707-7931.
The City had no pension related debt as of December 31, 2013.
8. RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to, or destruction of
assets; errors and omissions; workers compensation; health care of its employees; and
environmental damages for which the City purchases commercial insurance. There have been no
significant reductions in insurance coverage for any risk of loss in the past year and settled claims
have not exceeded the commercial coverage in any of the past three fiscal years.
C. Commitment and Contingencies
Claims and judgments are recorded as liabilities if all the conditions of Governmental Accounting
Standards Board pronouncements are met. The liability and expenditure for claims and judgments
are only reported in the governmental funds if it has matured. Claims and judgments are recorded
in the government-wide statements and proprietary funds as expenses when the related liabilities
are incurred.
From time to time, the City is party to various pending claims and legal proceedings. Although the
outcome of such matters cannot be forecasted with certainty, it is the opinion of management that
the likelihood is remote that any such claims or proceedings will have a material adverse effect on
the City's financial position or results of operations.
The city has received federal and state grants for specific purposes that are subject to review and
audit by the grantor agencies. Such audits could lead to the requests for reimbursements to the
grantor agency for expenditures disallowed under terms of the grants. Management believes
such disallowances, if any, would be immaterial.
Page 59
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE v -OTHER INFORMATION (continued)
c. COMMITMENTS AND CONTINGENCIES (continued)
Environmental Protection Agency
In 1983, the Environmental Protection Agency placed the Muskego Sanitary Landfill on the
National Superfund list. This prompted an investigation into alleged ground water contamination
emitting from the site. As a result of the initial investigation, the Environmental Protection Agency
named the City of Muskego as one of approximately 30 potentially responsible parties, in the
owner/operator group.
Another potentially responsible party, Waste Management of Wisconsin, Inc., has headed the
negotiations with the EPA relative to the preparation of a Remedial Investigation/Feasibility Study.
The City of Muskego is not a party to this stipulation regarding payment for this Study, which has
not yet been completed.
At December 31, 2013, the nature and extent of a potential liability for payment for the study as
well as payment for possible clean-up costs is unknown. The City has tendered the defense to its
insurance carriers but has not been advised as to its carrier's position with respect to the potential
liability.
In addition, the City has received Notices of Claims and Claims from other property owners
alleging the City's involvement with ground water contamination. The Notices have been
forwarded to the City's insurance carrier and the questions of coverage, liability and damages are,
as yet, unresolved.
The City has an agreement with Waste Management wherein Waste Management shall indemnify
the City from any potential Superfund liability.
D. WATER AND SEWER UTILITY RATES
The Water Utility implemented current rates effective October 1, 2011.
Effective January 1, 2010 the sewer rate for a single family residence is $167.66 per quarter or
$670.64 per year. All industrial and commercial users were charge on actual metered use at $6.81
per 1,000 gallons plus a connection charge of $69.10 per quarter.
E. ANTENNA LEASE AGREEMENTS
The City has lease agreements with four cellular phone companies to lease a Utility water tower
as a site for cellular antennas. The initial term of the leases was 5 years with the right to extend
the leases for four additional 5-year terms.
Rental income from rental of the water tower reported in other water revenues amounted to
$107,908.
Future minimum rentals related to these leases and expected future extensions are as follows:
2014
2015
2016
Total
$113,461
119,134
125,091
$357,686
Page 60
City of Muskego
Notes to Financial Statements
As of and for the Year Ended December 31, 2013
NOTE v -OTHER INFORMATION (continued)
F. EFFECT OF NEW ACCOUNTING STANDARDS ON CURRENT-PERIOD FINANCIAL STATEMENTS
The Governmental Accounting Standards Board (GASB) has approved the following:
• Statement No. 67, Financial Reporting for Pension Plans -an amendment of GASB
Statement No. 25
• Statement No. 68, Accounting and Financial Reporting for Pensions -an amendment of
GASB Statement No. 27
• Statement No. 69, Government Combinations and Disposals of Government Operations
• Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial
Guarantees
When they become effective, application of these standards may restate portions of these
financial statements.
Page 61
SUPPLEMENTARY INFORMATION
Park
Funds
ASSETS
Cash and cash equivalents $ 451,488
Accounts receivable -net
Due from other governments 10,665
Prepaid Items 14,000
Taxes receivable
TOTAL ASSETS $ 476,153
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts payable $ 124,153
Due to other governments
Total Liabilities 124,153
Deferred Inflows of Resources
Unearned revenues
Total Deferred Inflows of Resources
Fund Balances
Nonspendable 14,000
Restricted
Committed 338,000
Total Fund Balances 352,000
TOTAL LIABILITIES, DEFFERED
INFLOWS OF RESOURCES AND
FUND BALANCES $ 476,153
Sewer Utility
Special
Debt Service
Fund
$ 61,528
$ 61,528
$ -
61,528
61,528
$ 61,528
City of Muskego
Combining Balance Sheet
Non-major Governmental Funds
Special Revenue Funds
As of December 31, 2013
Other Refuse/ Revolving
Grant Recycling Loan
Fund Fund Fund
$ 10,950 $ 460,280 $ 384,980
269,989 219,530
60,676
$ 10,950 $ 790,945 $ 604,510
$ -$ 80,046 $ 3,146
320,000
80,046 323,146
10,950 710,899 281,364
10,950 710,899 281,364
$ 10,950 $ 790,945 $ 604,510
Landfill Well Land
Standing Stormwater Testing Open Space
Committee Management Reserve Conservation Rescue
Funds Fund Fund Fund Fund
$ 72,520 $ 409,686 $ 505,225 $ 120,505 $ 51
225
$ 72,520 $ 409,686 $ 505,225 $ 120,730 $ 51
$ -$ 40,707 $ -$ 1,685 $ 51
40,707 1,685 51
225
72,520 368,979 505,225 118,820
72,520 368,979 505,225 119,045
$ 72,520 $ 409,686 $ 505,225 $ 120,730 $ 51
Page 62
City of Muskego
Combining Balance Sheet
Non-major Governmental Funds
Special Revenue Funds
As of December 31, 2013
(Concluded)
Big Muskego
Lake-Non-Major
Community Federated Bass Bay Tax Special
Compensated Recreational Cable Capital Development Library Protection and Increment Revenue
Absences Ticket TV Improvements Authority System Rehabilitation Landfill District Fund
Fund Fund Fund Fund Fund Fund District Fund Funds Total
ASSETS
Cash and cash equivalents $ 545,755 $ 6,231 $ 138,551 $ 806,431 $ 191,007 $ 121,029 $ 96,062 $ 2,814,522 $ 428,775 $ 7,625,576
Accounts receivable -net 2,500 247,780 739,799
Due from other governments 3,607 14,272
Prepaid Items 14,225
Taxes receivable 1,373,580 1,434,256
TOTAL ASSETS $ 545,755 $ 6,231 $ 138,551 $ 808,931 $ 191,007 $ 121,029 $ 99,669 $ 3,062,302 $ 1,802,355 $ 9,828,128
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts payable $ -$ $ $ 8,130 $ $ 1,439 $ $ 5,630 $ -$ 264,987
Due to other governments 320,000
Total Liabilities 8,130 1,439 5,630 584,987
Deferred Inflows of Resources
Unearned revenues 4 1,373,580 1,373,584
Total Deferred Inflows of Resources 4 1,373,580 1,373,584
Fund Balances
Nonspendable 14,225
Restricted 428,775 490,303
Committed 545,755 6,231 138,551 800,801 191,007 119,590 99,665 3,056,672 7,365,029
Total Fund Balances 545,755 6,231 138,551 800,801 191,007 119,590 99,665 3,056,672 428,775 7,869,557
TOTAL LIABILITIES, DEFFERED
INFLOWS OF RESOURCES AND
FUND BALANCES $ 545,755 $ 6,231 $ 138,551 $ 808,931 $ 191,007 $ 121,029 $ 99,669 $ 3,062,302 $ 1,802,355 $ 9,828,128
Page 63
ASSETS
Cash and cash equivalents
TOT AL ASSETS
LIABILITIES AND FUND BALANCES
Liabilities
Accounts payable
Fund Balances
Assigned
TOTAL LIABILITIES AND
FUND BALANCES
City of Muskego
Combining Balance Sheet
Non-major Governmental Funds
Capital Projects Funds
As of December 31, 2013
Industrial
Park FBI
Expansion Shooting
Fund Range
$ 16,520 $ 9,102 $
$ 16,520 $ 9,102 $
16,520 9,102
$ 16,520 $ 9,102 $
Non-Major
Capital
Capital Projects
Equipment Fund
Fund Total
803,882 $ 829,504
803,882 $ 829,504
26,038 $ 26,038 -'--------'--
777,844 803,466
803,882 $ 829,504 ========'==
Page 64
ASSETS
Cash and cash equivalents
Accounts receivable -net
Due from other governments
Prepaid Items
Taxes receivable
TOT AL ASSETS
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts payable
Due to other governments
Total Liabilities
Deferred Inflows of Resources
Unearned revenues
Total Deferred Inflows of Resources
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Total Fund Balances
TOT AL LIABILITIES, DEFFERED
INFLOWS OF RESOURCES AND
FUND BALANCES
City of Muskego
Combining Balance Sheet
Non-major Governmental Funds
As of December 31, 2013
Non-Major
Special
Revenue
Fund
Total
$ 7,625,576
739,799
14,272
14,225
1,434,256
$ 9,828,128
$ 264,987
320,000
584,987
1,373,584
1,373,584
14,225
490,303
7,365,029
7,869,557
$ 9,828,128
Non-Major
Capital Non-major
Projects Governmental
Fund Funds
Total Total
$ 829,504 $ 8,455,080
739,799
14,272
14,225
1,434,256
$ 829,504 $ 10,657,632
$ 26,038 $ 291,025
320,000
26,038 611,025
1,373,584
1,373,584
14,225
490,303
7,365,029
803,466 803,466
803,466 8,673,023
$ 829,504 $ 10,657,632
Page 65
REVENUES
Taxes $
Intergovernmental
Licenses and permits
Public charges for services
Commercial revenue
Total Revenues
EXPENDITURES
Current
General government
Public Works
Health and sanitation
Conservation and development
Education and recreation
Capital Outlay
Total Expenditures
Excess (deficiency) of revenues
over expenditures
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital assets
Total Other Financing Source (Uses)
Net Change in Fund Balance
FUND BALANCES -Beginning of Year
FUND BALANCES -END OF YEAR $
City of Muskego
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Special Revenue Funds
For the Year Ended December 31, 2013
Sewer Utility Landfill
Special Other Refuse/ Revolving Standing Stormwater
Park Debt Service Grants Recycling Loan Committee Management
Fund Funds Fund Fund Fund Fund Fund
$ $ $ $ $ $
23,904 73,223
7,203
228,436 981,720 10,000
91,823 39,322 4,936 21 467
351,366 1,094,265 4,936 10,021 467
16,989
1,087,428
7,692 6,401
1,903,952 64,300
1,903,952 1,087,428 7,692 6,401 81,289
(1,552,586) 6,837 (2,756} 3,620 (80,822)
1,652,210
(75,361}
1,652,210 (75,361)
99,624 6,837 (2,756) 3,620 (156,183}
252,376 61,528 10,950 704,062 284,120 68,900 525,162
352,000 $ 61,528 $ 10,950 $ 710,899 $ 281,364 $ 72,520 $ 368,979
Well Land
Testing Open Space
Reserve Conservation Rescue
Fund Fund Fund
$ $ $
275
33,000 142,371
488 140
33,488 142,786
124,937
13,634
138,571
33,488 4,215
(50,000)
(50,000)
33,488 (45,785)
471,737 164,830
$ 505,225 $ 119,045 $
Page 66
City of Muskego
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Special Revenue Funds
For the Year Ended December 31, 2013
(Concluded)
Big Muskego
Lake-Non-Major
Community Federated Bass Bay Tax Special
Compensated Recreational Capital Development Library Protection and Increment Revenue
Absences Ticket Cable TV Improvement Authority System Rehabilitation Landfill District Fund
Fund Fund Fund Fund Fund Fund District Fund Funds Total
REVENUES
Taxes $ $ $ $ $ $ $ $ $ 1,208,074 $ 1,208,074
Intergovernmental revenues 7,500 2,400 12,831 120,133
Licenses and permits 7,203
Public charges for services 17,719 28,685 883,743 2,325,674
Commercial revenue 3,333 6 818 252 1,522 429 3,652 147,209
Total Revenues 3,333 17,725 8,318 252 3,922 29,114 887,395 1,220,905 3,808,293
EXPENDITURES
Current
General government 141,964 34,458 15,000 191,422
Public Works 16,989
Health and sanitation 74,152 1,161,580
Conservation and development 37,693 2,160 91,322 270,205
Education and recreation 17,275 13,666 30,941
Capital Outlay 3,560 395,486 2,380,932
Total Expenditures 141,964 17,275 34,458 37,693 5,720 13,666 91,322 74,152 410,486 4,052,069
Excess (deficiency) of revenues
over expenditures (138,631) 450 (34,458) (29,375) (5,468) (9,744) (62,208) 813,243 810,419 (243,776)
OTHER FINANCING SOURCES (USES)
Transfers in 177,980 1,830,190
Transfers out (177,980) (2,727,210) (714,125) (3,744,676)
Proceeds from sale of capital assets 149 149
Total Other Financing Source (Uses) 149 (2, 727,210) (714,125) (1,914,337)
Net Change in Fund Balance (138,631) 450 (34,458) (29,375) (5,468) (9,595) (62,208) (1,913,967) 96,294 (2, 158, 113)
FUND BALANCES -Beginning of Year 684,386 5,781 173,009 830,176 196,475 129,185 161,873 4,970,639 332,481 10,027,670
FUND BALANCES -END OF YEAR $ 545,755 $ 6,231 $ 138,551 $ 800,801 $ 191,007 $ 119,590 $ 99,665 $ 3,056,672 $ 428,775 $ 7,869,557
Page 67
City of Muskego
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Capital Projects Funds
For the Year Ended December 31, 2013
Non-Major
Industrial Capital
Park FBI Capital Projects
Expansion Shooting Equipment Fund
Fund Range Fund Total
REVENUES
Intergovernmental revenues $ -$ -$ 88,120 $ 88,120
Commercial revenue 17 54,265 54,282
Total Revenues 17 142,385 142,402
EXPENDITURES
Capital Outlay
General government 162,211 162,211
Public safety 102,633 102,633
Public works 2,086 289, 164 291,250
Conservation and development 37,215 37,215
Education and recreation 9,020 9,020
Total Expenditures 2,086 600,243 602,329
Deficiency of revenues
under expenditures (2,069) (457,858) (459,927)
OTHER FINANCING SOURCES
Proceeds from sale of capital assets 7,000 7,000
Transfers in 1,075,000 1,075,000
Total Other Financing Sources 1,082,000 1,082,000
Net Change in Fund Balance (2,069) 624,142 622,073
FUND BALANCES -Beginning of Year 18,589 9,102 153,702 181,393
FUND BALANCES -END OF YEAR $ 16,520 $ 9,102 $ 777,844 $ 803,466
Page 68
City of Muskego
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
For the Year Ended December 31, 2013
Non-Major Non-Major
Special Capital Non-major
Revenue Projects Governmental
Fund Fund Funds
Total Total Total
REVENUES
Taxes $ 1,208,074 $ -$ 1,208,074
Intergovernmental 120,133 88,120 208,253
Licenses and permits 7,203 7,203
Public charges for services 2,325,674 2,325,674
Commercial revenue 147,209 54,282 201,491
Total Revenues 3,808,293 142,402 3,950,695
EXPENDITURES
Current:
General government 191,422 191,422
Public works 16,989 16,989
Health and sanitation 1, 161,580 1,161,580
Conservation and development 270,205 270,205
Education and recreation 30,941 30,941
Capital Outlay 2,380,932 602,329 2,983,261
Total Expenditures 4,052,069 602,329 4,654,398
Deficiency of revenues
under expenditures (243,776) (459,927) (703,703)
OTHER FINANCING SOURCES (USES)
Transfers in 1,830,190 1,075,000 2,905,190
Transfers out (3, 7 44,676) (3,744,676)
Proceeds from sale of capital assets 149 7,000 7,149
Total Other Financing Source (Uses) (1,914,337) 1,082,000 (832,337)
Net Change in Fund Balance (2, 158, 113) 622,073 (1,536,040)
FUND BALANCES -Beginning of Year 10,027,670 181,393 10,209,063
FUND BALANCES -END OF YEAR $ 7,869,557 $ 803,466 $ 8,673,023
Page 69
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
Muskego, Wisconsin
FINANCIAL STATEMENTS
Including Independent Auditor's Report
As of and for the Years Ended
December 31, 2013 and 2012
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
TABLE OF CONTENTS
As of and tor the Years Ended December 31, 2013 and 2012
Independent Auditors' Report
Financial Statements
Statements of Net Position
Statements Revenues, Expenses and Changes in Net Position
Statements of Cash Flows
Notes to Financial Statements
Supplementary Information
Operation and Maintenance Expenses
Utility Plant in Service
Summary of Long-Term Indebtedness
Schedule of Construction Funds
Statistical Information
Schedule of Insurance in Force
1 - 2
3-4
5
6-7
8-25
26
27
28
29
30
31
To the Mayor and Common Council
City of Muskego Sewer Utility
Muskego, Wisconsin
INDEPENDENT AUD ITORS' REPORT
Report on the Financial Statements
~AKER TILLY
Baker Tilly Virchow Krause, LLP
777 E Wisconsin Ave, 32nd Floor
Milwau kee, WI 53202-53 13
rel 414 777 5500
fax414 777 5555
bakerrilly.com
We have audited the accompanying financial statements of the City of Muskego Sewer Utility, an enterprise
fund of the City of Muskego, Wisconsin, as of and for the years ended December 31, 2013, and 2012, and the
related notes to the financial statements, as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair p resentation of
financial statements that are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Ou r responsibility is to express an opinion on these financial statements based on our audits. We conducted
our audits in accordance with auditing standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors' judgment, including the assessment of
the risks of material misstatement of the financial statements , whether due to fraud or error. In making those
risk assessments , the auditor considers internal control relevant to the City of Muskego Sewer Utility's
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the
City of Muskego Sewer Utility's internal control. Acco rdingly, we express no such opinion. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements .
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ou r
audit opinion .
~ llfli..,deoeriOentmemb~rof
BAKER TILLY
INTERNATIONAL
Page 1
An Affirmative Action Equal Opportunity Employer
To the Mayor and Common Council
City of Muskego
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial
position of the City of Muskego Sewer Utility as of December 31, 2013 and 2012, and the changes in its
financial position and, where applicable, cash flows for the year then ended in accordance with accounting
principles generally accepted in the United States of America.
Emphasis of Matter
As discussed in Note 1, the financial statements present only the City of Muskego Sewer Utility enterprise fund
and do not purport to, and do not present fairly the financial position of the City of Muskego, Wisconsin, as of
December 31, 2013, and 2012, and the changes in its financial position and, where applicable, its cash flows for
the years then ended, in accordance with accounting principles generally accepted in the United States of
America. Our opinion is not modified with respect to this matter.
As discussed in Note 1, the City of Muskego Sewer Utility adopted the provisions of GASB Statement No. 65,
Items Previously Reported as Assets and Liabilities, effective January 1, 2013. The prior year had been
restated for this change. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Management has omitted Management's Discussion and Analysis that accounting principles generally accepted
in the United States of America require to be presented to supplement the financial statements. Such missing
information, although not a part of the financial statements, is required by the Governmental Accounting
Standards Board who considers it to be an essential part of financial reporting for placing the financial
statements in an appropriate operational, economic, or historical context. Our opinion on the financial
statements is not affected by this missing information.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The
supplementary information as listed in the table of contents is presented for purposes of additional analysis and
is not a required part of the 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 financial
statements. The information has been subjected to the auditing procedures applied in the audit of the financial
statements and certain additional procedures, including comparing and reconciling such information directly to
the underlying accounting and other records used to prepare the financial statements or to the financial
statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion, the supplementary information is fairly stated in all
material respects, in relation to the financial statements as a whole.
P!:r;tt;tA 777Lr 0~,w ~rtUAu, uP
Milwaukee, Wisconsin
August 6, 2014
Page2
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF NET POSITION
As of December 31, 2013 and 2012
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES
CURRENT ASSETS
Cash and investments
Operation and maintenance
Temporary investments
Accounts receivable -net
Prepaid items
Deferred contractual charge
Restricted Assets
Debt Service Fund -Redemption
Cash and investments
Total Current Assets
NON-CURRENT ASSETS
Restricted Assets
Debt Service Fund
Cash and investments
Reserve Capacity Assesssment Fund
Cash and investments
RCA assessments receivable
Equipment Replacement Fund
Cash and investments
Capital Assets
Land
Construction in progress
Plant in service
Accumulated depreciation
Other Assets
Special assessments
Total Non-Current Assets
DEFERRED OUTFLOWS OF RESOURCES
Deferred loss on refunding
TOT AL ASSETS AND DEFERRED OUTFLOWS OF
RESOURCES
__ 2_0_13 __ 2012 (Restated)
$ 9,082,318 $ 9,032,981
735,386 729,320
2,101,942 2,088,395
600
286,271 63,724
211,489 203,123
12,418,006 12,117,543
380,950 380,950
5,324,033 5,007,806
263,235 291,868
816,801 789,851
130,918 130,918
69,656 325,359
61,788,577 61,166,449
(19,769,712) (18,652,944)
82,689 94,503
49,087,147 49,534,759
___ 5_2-'-,8_8_8 98,220
$ 61,558,041 $ 61,750,522
Page 3
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF NET POSITION
(Continued)
As of December 31, 2013 and 2012
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION
CURRENT LIABILITIES
Accounts payable
Deferred contractual charge
Accrued vacation, sick leave and compensatory time
Liabilities Payable From Restricted Assets
Current portion of long-term debt
Accrued interest payable
Total Current Liabilities
NON-CURRENT LIABILITIES
Revenue bonds
Unearned revenue
Total Non-Current Liabilities
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unearned revenue
NET POSITION
Net investment in capital assets
Restricted for:
Debt service
RCA funds
Equipment replacement
Unrestricted
$
2013
394,921
286,271
210,356
295,000
14,822
1,201,370
2,005,000
549,225
2,554,225
3,755,595
24,155
40,353,277
196,667
5,587,268
816,801
10,824,278
57,778,291
2012 (Restated)
$ 323,921
63,724
201,195
280,000
16,456
885,296
2,300,000
549,226
2,849,226
3,734,522
27,955
40,868,953
186,667
5,299,674
789,851
10,842,900
57,988,046
TOTAL LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND NET POSITION $ 61,558,041 $ 61,750,522
See accompanying notes to financial statements. Page 4
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
For the Years Ended December 31, 2013 and 2012
2013 2012 (Restated)
OPERATING REVENUES
Charges for services $ 6,025,333 $ 5,987,462
Other operating revenues 16,452 13,903
Total Operating Revenues 6,041,785 6,001,364
OPERATING EXPENSES
Operation and maintenance 5,617,666 5,275,438
Depreciation 1, 116,768 1,095,057
Total Operating Expenses 6,734,434 6,370,495
OPERATING LOSS (692,649) (369, 131)
NONOPERATING REVENUES (EXPENSES)
Investment income 22,206 29,451
Interest income on RCA's and special assessments 27,954 38,629
MMSD l&I Subsidy 7,509 75,905
l&I MMSD program (7,509) (75,905)
Interest expense (92,201) (101,885)
Amortization of bond discount {45,332) {45,333)
Total Non-Operating Revenues (Expenses) {87,373) {79,138)
Loss Before Contributions (780,022) (448,269)
CAPITAL CONTRIBUTIONS
Developer and customer 262,981 240,191
Contribution from the City 284,786 34,023
Sewer connection fees 22,500 29,000
Change in Net Position (209,755) (145,054)
NET POSTION -Beginning of Year (as restated) 57,988,046 58,133,100
NET POSITION -END OF YEAR $ 57,778,291 $ 57,988,046
See accompanying notes to financial statements. Page 5
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2013 and 2012
2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Received from customers $ 6,031,950 $ 6,060,843
Paid to vendors for goods and services (4,756,230) (4,624,223)
Paid to employees for services (790,441) (725,746)
Payments to other funds {40,566) {40,746)
Net Cash Flows From Operating Activities 444,713 670,128
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Acquisition and construction of capital assets (40,017) (265, 189)
Debt retired (280,000) (270,000)
Interest paid (93,835) (103,460)
Special assessments received 303,427 311,692
Connection fees received 22,500 29,000
Net Cash Flows From Capital
and Related Financing Activities {87,925) {297,957)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment income
Interest on investments 22,204 29,420
Interest on RCA's and special assessments 27,954 38,629
Investments purchased (735,386) (729,320)
Investments sold and matured 729,320 225,081
Net Cash Flows From Investing Activities 44,092 {436, 190)
Net Increase (Decrease) in Cash and Cash Equivalents 400,880 (64,019)
CASH AND CASH EQUIVALENTS-Beginning of Year 15,414,711 15,478,730
CASH AND CASH EQUIVALENTS-END OF YEAR $ 15,815,591 $ 15,414,711
Page 6
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF CASH FLOWS
(Continued)
For the Years Ended December 31, 2013 and 2012
RECONCILIATION OF CASH AND CASH EQUIVALENTS TO THE
STATEMENT OF NET POSITION -PROPRIETARY FUNDS
Unrestricted
Operation and maintenance $
Temporary investments
Restricted
Current:
Debt Service Fund
Noncurrent:
Debt Service Fund
Reserve Capacity Assessment Fund
Equipment Replacement Fund
Less: non-cash equivalents
CASH AND CASH EQUIVALENTS $
NON CASH INVESTING, CAPITAL AND FINANCING ACTIVITIES
Capital additions contributed to the Utility by the City $
Assessment of benefits to property owners for improvements $
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Operating income (loss) $
Noncash items in operating loss
Depreciation expense
Changes in assets and liabilities
Accounts receivable
Prepaid items
Deferred contractual charge
Accounts payable
Accrued vacation, sick leave and compensatory time
Deferred contractual credit
NET CASH FLOWS FROM OPERATING ACTIVITIES $
See accompanying notes to financial statements.
2013 2012
9,082,318 $ 9,032,981
735,386 729,320
211,489 203, 123
380,950 380,950
5,324,033 5,007,806
816,801 789,851
(735,386) (729,320)
15,815,591 $ 15,414,711
284,786 $ 34,023
262,981 $ 240, 191
(692,649) $ (369,131)
1, 116,768 1,095,057
(17,344) 240,888
(600)
(222,547) (63,724)
251,924 26,759
9, 161 (2,406)
{257,315)
444,713 $ 670,128
Page 7
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the City of Muskego Sewer Utility (utility) have been prepared in
conformity with accounting principles generally accepted in the United States of America as
applied to enterprise funds of government units. The Governmental Accounting Standards Board
(GASB) is the accepted standard-setting body for establishing governmental accounting and
financial reporting principles.
The significant accounting principles and policies utilized by the utility are described below:
REPORTING ENTITY AND NATURE OF BUSINESS
The utility is a separate enterprise fund of the City of Muskego (municipality). The utility accounts
for the cost of operations on a continuing basis and is managed by the city council. The utility
provides sewer service to properties within the municipality with wastewater treated by the
Milwaukee Metropolitan Sewerage District.
The utility operates under service rules and rates established by the City's Common Council.
MEASUREMENT Focus, BASIS OF ACCOUNTING AND FINANCIAL STATEMENT PRESENTATION
The utility is presented as an enterprise fund of the municipality. Enterprise funds are used to
account for operations that are financed and operated in a manner similar to private business or
where the governing body has decided that the determination of revenues earned, costs incurred
and net income is necessary for management accountability.
The financial statements are reported using the economic resources measurement focus and the
accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized
when earned and expenses are recorded when the liability is incurred or economic asset used.
Revenues, expenses, gains, losses, assets and liabilities resulting from exchange and exchange-
like transactions are recognized when the exchange takes place.
In March 2012, the Governmental Accounting Standards Board (GASB) issued Statement No. 65
-Items Previously Reported as Assets and Liabilities. This statement clarifies the appropriate
reporting of deferred outflows of resources and deferred inflows of resources to ensure
consistency in financial reporting. Previous financial reporting standards did not include
guidance for these elements, which are distinct from assets and liabilities.
The utility implemented this standard effective January 1, 2012. The adoption of this standard
had a significant effect on the utility's financial statements. Refer to Note IX.
Page 8
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
MEASUREMENT Focus, BASIS OF ACCOUNTING AND BASIS OF PRESENTATION (continued)
Preparation of financial statements in conformity with accounting principles generally accepted in
the United States of America requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates.
ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND
NET POSITION
Deposits and Investments
For purposes of the statement of cash flows, cash equivalents have original maturities of three
months or less from the date of acquisition.
State statutes restrict investment of utility funds. Investments are limited to:
1. Time deposits in any credit union, bank, savings bank or trust company maturing in
three years or less.
2. Bonds or securities of any county, city, drainage district, technical college district,
village, town, or school district of the state. Also, bonds issued by a local exposition
district, a local professional baseball park district, local professional football stadium
district, local cultural arts district, or by the University of Wisconsin Hospitals and
Clinics Authority.
3. Bonds or securities issued or guaranteed by the federal government.
4. The local government investment pool.
5. Any security maturing in seven years or less and having the highest or second highest
rating category of a nationally recognized rating agency.
6. Securities of an open-end management investment company or investment trust,
subject to various conditions and investment options.
7. Repurchase agreements with public depositories, with certain conditions.
The utility has not adopted a formal investment policy and is covered under an investment policy
adopted by the municipality. Please reference the City of Muskego financial statements for
details of this investment policy and its assessment of deposit and investment risks.
The Wisconsin Local Government Investment Pool (LGIP) is part of the State Investment Fund
(SIF), and is managed by the State of Wisconsin Investment Board. The SIF is not registered
with the Securities and Exchange Commission, but operates under the statutory authority of
Wisconsin Chapter 25. The SIF reports the fair value of its underlying assets annually.
Participants in the LGIP have the right to withdraw their funds in total on one day's notice. At
December 31, 2013, the fair value of the city's share of the LGIP's assets was substantially equal
to the amount as reported in these statements.
Page 9
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND
NET POSITION (continued)
Deposits and Investments (continued)
Investments are stated at fair value, which is the amount at which an investment could be
exchanged in a current transaction between willing parties. Fair values are based on quoted
market prices. No investments are reported at amortized cost. Adjustments necessary to record
investments at fair value are recorded in the operating statement as increases or decreases in
investment income. Market values may have changed significantly after year end.
See Note 2 for further information.
Receivables/Payables
Transactions between the utility and other funds of the municipality that are representative of
lending/borrowing arrangements outstanding at year-end are referred to as advances to/from
other funds. All other outstanding balances between the utility and other funds of the municipality
are reported as due to/from other funds.
The utility has the right under Wisconsin statutes to place delinquent sewer bills on the tax roll
for collection. As such, no allowance for uncollectible customer accounts is considered
necessary.
Restricted Assets
Mandatory segregations of assets are presented as restricted assets. Bond agreements and
other external parties require such segregations. Current liabilities payable from these restricted
assets are so classified.
1. Operation and Maintenance Fund: A monthly amount equal to the estimated current
expenses for such month and for the following two months.
2. Special Redemption Fund -Principal and Interest: A monthly amount equal to one-sixth
(1/6) of the next installment of interest coming due and an amount equal to one-twelfth
(1 /12) of the installment of principal of the bonds coming due on the next succeeding
principal payment date.
3. Special Redemption Fund -Reserve: A monthly amount equal to the total Reserve
Account requirements divided by twelve until the amount accumulated in the Reserve
Account totals the highest annual debt service on the outstanding bonds.
4. Depreciation Fund: An amount determined by the City Common Council to finance
system repairs, replacements or the acquisition of capital equipment identified in the
annual budget which are not financed by a revenue bond issue.
5. Surplus Fund: Any amount remaining after the above monthly transfers have been
completed.
Page 10
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND
NET POSITION (continued)
Restricted Assets (continued)
The authorizing resolution did not however specify amounts to be allocated to the following
funds:
Depreciation Fund
Surplus Fund
As a result, at December 31, 2013 the utility has not allocated any amounts to these funds.
In lieu of establishing a specific Depreciation Fund, the utility has established an "equipment
replacement reserve" which management believes satisfies the bond resolution covenant. The
equipment replacement reserve was established to comply with Wisconsin Department of Natural
Resources requirements and is to be used for the replacement of significant mechanical
equipment.
Restricted net position principally represent the Reserve Capacity Assessment Fund, Equipment
Replacement Fund and Special Redemption Fund restricted assets less related current liabilities
payable from restricted assets and funds financed by borrowings.
Restricted Construction Funds, if any, represent proceeds from long-term debt, which will be
utilized to finance certain construction projects. Unrestricted Construction Funds represent
working capital designated by management for construction purposes. There are no restricted
construction funds at December 31, 2013.
Deferred Contractual Charge I Credit
Deferred contractual charges/credits represent amounts billed/credited by the Milwaukee
Metropolitan Sewerage District related to capital costs that are recognized as expense and are
payable in the subsequent year.
Special Assessments Receivable
This account represents the balances of special assessments levied against property owners for
infrastructure improvements. The balances are receivable over various time periods with interest
accrued annually.
Anticipated Future Special Assessments
At December 31, 2013, there was $525,240 of anticipated future assessments which are not
reported as receivables because collection is subject to certain events occurring in the future
and no formal repayment schedule has been established.
Page 11
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND
NET POSITION (continued)
Capital Assets
Capital assets are defined by the utility as assets with an initial, individual cost of more than
$5,000 and an estimated useful life in excess of one year.
Capital assets of the utility are recorded at cost or the fair market value at the time of
contribution to the utility. Major outlays for utility plant are capitalized as projects are
constructed. Interest incurred during the construction phase is reflected in the capitalized value
of the capital assets constructed, net of interest earned on the invested proceeds over the same
period. $0 of net interest was capitalized during the current year and the prior year. Capital
assets in service are depreciated using the straight-line method over the following useful lives:
Buildings and improvements
Improvements other than buildings -
utility collection system
Machinery and equipment
Deferred Inflows of Resources
Years
20 -50
40 -125
4-25
A deferred inflow of resources represents an acquisition of net position that applies to a future
period and therefore will not be recognized as an inflow of resources (revenue) until that future
time.
Compensated Absences
Under terms of employment, employees are granted sick leave and vacations in varying
amounts. Only benefits considered to be vested are disclosed in these statements. Vested
vacation and sick leave pay is accrued when earned in the financial statements. The liability is
liquidated from general operating revenues of the utility.
Deferred Outflows of Resources
A deferred outflow of resources represents a consumption of net position that applies to the
future period and will not be recognized as an outflow of resources expense until that future time.
Loss on refunding is a deferred charge resulting from the refunding of debt as is amortized over
the shorter of the term of the refunding issue or the original term of the refunded debt.
Page 12
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND
NET POSITION (continued)
Long-Term Obligations
Long-term debt and other obligations are reported as utility liabilities. Bond premiums and
discounts are deferred and amortized over the life of the bonds using the straight-line method.
Gains or losses on refundings are amortized over the remaining life of the old debt or the life of
the new debt, whichever is shorter. The balance at year end for premiums and discounts is
shown as an increase or decrease in the liability section of the statement of net position. The
balance at year end for the loss on refunding is shown as a deferred outflow in the statement of
net position.
Unearned Revenues
Unearned revenues principally represent deferred special assessments which will be reported as
contributed capital when and if the property owner connects to the system and the assessment
becomes due, and prepayments of RCA assessments.
Equity Classifications
Equity is classified as net position and displayed in three components:
a. Net investment in capital assets -Consists of capital assets including restricted capital
assets, net of accumulated depreciation and reduced by the outstanding balances of any
bonds, mortgages, notes, or other borrowings that are attributable to the acquisition,
construction, or improvement of those assets.
b. Restricted net position -Consists of net position with constraints placed on their use
either by 1) external groups such as creditors, granters, contributors, or laws or
regulations of other governments or, 2) law through constitutional provisions or enabling
legislation.
c. Unrestricted net position -All other net position that do not meet the definitions of
"restricted" or "net investment in capital assets".
REVENUES AND EXPENSES
The utility distinguishes operating revenues and expenses from nonoperating items. Operating
revenues and expenses generally result from providing services and producing and delivering
goods in connection with the utility's principle ongoing operations. The principle operating
revenues of the utility are charges to customers for services. 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.
Page 13
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
REVENUES AND EXPENSES (continued)
Charges for Services
Billings are rendered and recorded quarterly based on metered usage. The utility does not
accrue revenues beyond billing dates.
Effective January 1, 2012, the sewer rate for a single-family residence was $167.66 per quarter
or $670.64 per year. All industrial and commercial users were billed on actual metered use at
$6.81 per 1,000 gallons plus a connection charge of $69.10 per quarter.
Effective January 1, 2013, the sewer rate for a single-family residence was $167.66 per quarter
or $670.64 per year. All industrial and commercial users were billed on actual metered use at
$6.81 per 1,000 gallons plus a connection charge of $69.10 per quarter.
Capital Contributions
Cash and capital assets are contributed to the utility from customers, the municipality or external
parties. The value of property contributed to the utility is reported as revenue on the statements
of revenues, expenses and changes in net position.
The sewer utility charges new customers a connection fee to connect to the system. Fees
collected are recorded as capital contributions on the statements of revenues, expenses and
changes in net position.
Effect of New Accounting Standards on Current Period Financial Statement
The Governmental Accounting Standards Board (GASS) has approved the following:
• Statement No. 67, Financial Reporting for Pension Plans -an amendment of GASB
Statement No. 25
• Statement No. 68, Accounting and Financial Reporting for Pensions -an amendment of
GASB Statement No. 27
• Statement No. 69, Government Combinations and Disposals of Government Operations
• Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial
Guarantees
When they become effective, application of these standards may restate portions of these
financial statements.
Comparative Data
Certain amounts presented in the prior year data may have been reclassified in order to be
consistent with the current year's presentation.
Page 14
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE II -CASH, CASH EQUIVALENTS AND TEMPORARY INVESTMENTS
The utility's carrying values of cash and cash equivalents and temporary investments as of
December 31, 2013 and 2012 consisted of the following:
Associated
2013 2012 Risks
Cash and cash equivalents
Demand deposits $ 652,053 $ 642,501 Custodial Credit Risk
Commingled cash and investments
with the City 14,343,532 13,953,016 Not Applicable
LG IP/WISC 820,006 819,195 Credit Risk
Total Cash and Cash Equivalents 15,815,591 15,414,711
Temporary Investments
Certificate of deposit 735,386 729,320 Custodial Credit Risk
Total Cash, Cash Equivalents, and $ 16,550,977 $ 16,144,031 Temporary Investments
Reconciliation to financial statements
Unrestricted cash and investments
Operation and maintenance $ 9,082,318 $ 9,032,981
Temporary investments 735,386 729,320
Restricted cash and investments
Debt service -current 211,489 203,123
Debt service -non-current 380,950 380,950
RCA cash and investments 5,324,033 5,007,806
Equipment replacement fund 816,801 789,851
Total Cash and Investments $ 16,550,977 $ 16,144,031
The bank balances were substantially equal to the carrying values shown above.
Deposits in each local and area bank are insured by the FDIC in the amount of $250,000 for time
and savings accounts (including NOW accounts), $250,000 for demand deposits (interest-
bearing and noninterest-bearing). In addition, if deposits are held in an institution outside of the
state in which the government is located, insured amounts are further limited to a total of
$250,000 for combined amount of all deposit accounts.
Bank accounts are also insured by the State Deposit Guarantee Fund (SDGF) in the amount of
$400,000. However, due to the nature of the fund, recovery of material principle losses may not
be significant to individual municipalities.
Page 15
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE II -CASH, CASH EQUIVALENTS AND TEMPORARY INVESTMENTS (continued)
Custodial Credit Risk
The utility maintains certain deposits at the same institutions as the municipality. The custodial
credit risk pertaining specifically to the utility's resources cannot be determined for those
accounts. Please refer to the municipality's financial statements for information on this risk.
Deposits
Custodial credit risk is the risk that in the event of a financial institution failure, the utility's
deposits may not be returned to the utility.
Investments
For an investment, custodial credit risk is the risk that, in the event of the failure of the
counterparty, the utility will not be able to recover the value of its investments or collateral
securities that are in possession of an outside party.
Credit Risk
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its
obligation.
As of December 31, 2013 and 2012 the utility had investments in LGIP. LGIP is unrated.
See Note I Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources
and Net Position -Deposits and Investments for further details.
Page 16
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE Ill -RESTRICTED ASSETS
Restricted assets were comprised of the following restricted funds at December 31, 2013 and
2012:
Cash, Cash Equivalents and Temporary Investments
Debt Service Fund -Special Redemption Funds
Reserve
Redemption
Total
Reserve Capacity Assessment (RCA) Funds
Equipment Replacement Funds
Total Cash, Cash Equivalents and Temporary Investments
RCA assessments receivable
Total Restricted Assets
Below are descriptions for restricted assets:
Debt Service Fund -Long Term Debt
$
$
2013 2012
380,950 $ 380,950
211,489 203,123
592,439 584,073
5,324,033 5,007,806
816,801 789,851
6,733,273 6,381,730
263,235 291,868
6,996,508 $ 6,673,598
Redemption Used to segregate resources accumulated tor debt service payments
over the next twelve months.
Reserve Used to report resources set aside to make up potential future
deficiencies in the redemption account.
Reserve Capacity Assessments Funds
The utility has established funds to account for capacity assessment levies that are restricted to
finance certain system capital costs or related debt service costs.
Equipment Replacement Funds
The sewer utility established an equipment replacement account to be used for significant
mechanical equipment replacement as required by the Wisconsin Department of Natural
Resources and debt covenants.
Page 17
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE IV -ACCOUNTS RECEIVABLE
Receivables for the utility as of the year ended December 31, 2013 and 2012 are as follows:
2013 2012
Accounts receivable -net
Customer $ 2,081,618 $ 1,989,718
Other governments 76,764
Special assessments 19,373 20,318
Accrued interest 240 238
Other 711 1,357
Total $ 2,101,942 $ 2,088,395
All receivables net of allowances are expected to be collected within one year.
NOTE V -DEFINED BENEFIT PENSION PLAN
All eligible City of Muskego employees participate in the Wisconsin Retirement System (WRS), a
cost-sharing, multiple employer, defined benefit, public employee retirement system. All
employees initially employed by a participating WRS employer prior to July 1, 2011, expected to
work at least 600 hours a year (440 hours for teachers and school district educational support
employees) and expected to be employed for at least one year from employee's date of hire, are
eligible to participate in the WRS. All employees initially employed by a participating WRS
employer on or after July 1, 2011, and expected to work at least 1,200 hours a year (880 hours
for teachers and school district educational support employees), and expected to be employed
for at least one year from employee's date of hire are eligible to participate in the WRS. Note:
Employees hired to work nine or ten months per year, (e.g. teachers contracts), but expected to
return year after year are considered to have met the one-year requirement.
Effective the first day of the first pay period on or after June 29, 2011, the employee required
contribution was changed to one-half of the actuarially determined contribution rate for
employees in the General Employment category, including Teachers, and Executives and
Elected Officials. Required contributions for protective contributions are the same rate as general
employees. Employers are required to contribute the remainder of the actuarially determined
contribution rate. The employer may not pay the employee required contribution unless provided
for by an existing collective bargaining agreement.
Page 18
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE v -DEFINED BENEFIT PENSION PLAN (continued)
Contribution rates for 2013, 2012, and 2011 were:
2013 General Category
2012 General Category
2011 General Category
Employee
6.65%
5.90%
7.05%
Employer
6.65%
5.90%
7.05%
The payroll for City of Muskego Sewer Utility employees covered by the WRS tor the year ended
December 31, 2013, 2012, and 2011 was $547, 186, $525,623, and $523,557 respectively. The
total required contribution for the year ended December 31, 2013 was $72,775, which consisted
of 6.65% of payroll from the employer and 6.65% of payroll from employees. Total contributions
for the years ending December 31, 2012 and 2011 were $62,023 and $60,733, respectively,
equal to the required contributions tor each year.
Employees who retire at or after age 65 (62 for elected officials and 54 for protective occupation
employees with less than 25 years of service, 53 tor protective occupation employees with more
than 25 years of service) are entitles to receive a retirement benefit. Employees may retire at
age 55 (50 tor protective occupation employees) and receive actuarially reduced benefits. The
factors influencing the benefit are: (1) final average earnings, (2) years of creditable service and
(3) a formula factor. A final average earnings is the average of the employee's three highest
years' earnings. Employees terminating covered employment and submitting application before
becoming eligible tor a retirement benefit may withdraw their contributions and, by doing so,
forfeit all rights to any subsequent benefit. For employees beginning participation on or after
January 1, 1990 and no longer actively employed on or after April 24, 1998, creditable service in
each of five years is required tor eligibility tor a retirement annuity. Participants employed prior
to 1990 and on or after April 24, 1998 and prior to July 1, 2011 are immediately vested.
Participants who initially became WRS eligible on or after July 1, 2011 must have five years of
creditable service to be vested.
Details of the plan are also disclosed in the basic financial statements of the City of Muskego.
Page 19
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VI -CHANGES IN CAPITAL ASSETS
A summary of changes in capital assets for 2013 is as follows:
Capital assets, not being depreciated
Land and land rights
Construction in progress
Total Capital Assets not being
Depreciated
Capital assets being depreciated
Buildings and improvements
Improvements other than
buildings
Machinery and equipment
Total Capital Assets
Being Depreciated
Less: Accumulated depreciation
Buildings and improvements
Improvements other than
buildings
Machinery and equipment
Total accumulated depreciation
Net Capital Assets
Being Depreciated
$
$
$
Balance
01/01/13
130,918
325,359
456,277
12,941,407
46,639,553
1,585,489
61,166,449
(7,400,719)
(9,833,061)
(1,419,164)
(18,652,944)
42,513,505
$
$
$
Additions Retirements
-$ -
71,290 326,993
71,290 $ 326,993
-$ -
611,779
10,349
622,128
(550,086)
(468,162)
(98,520) ----
(1, 116,768) ----
(494,640) ----
$
$
$
Balance
12/31/13
130,918
69,656
200,574
12,941,407
47,251,332
1,595,838
61,788,577
(7,950,805)
(10,301,223)
(1,517,684)
(19,769,712)
42,018,865
Total Capital Assets,
Net of Depreciation $ 42,969,782 $ (423,350) $ 326,993 $ 42,219,439
Page 20
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VI -CHANGES IN CAPITAL ASSETS (continued)
A summary of changes in capital assets for 2012 is as follows:
Balance
1 /01/12 Additions Retirements
Capital assets, not being depreciated
Land and land rights $ 130,918 $ -$ -
Construction in progress 789,349 250,779 714,769
Total Capital Assets not being
Depreciated $ 920,267 $ 250,779 $ 714,769
Capital assets being depreciated
Buildings and improvements $ 12,217,958 $ 723,449 $ -
Improvements other than
buildings 46,628,283 11,270
Machinery and equipment 1,585,489
Total Capital Assets
Being Depreciated 60,431,730 734,719
Less: Accumulated depreciation
Buildings and improvements (6,868,719) (532,000)
Improvements other than
buildings (9,368,007) (465,054)
Machinery and equipment (1,321,161) (98,003)
Total accumulated depreciation (17,557,887) {1,095,057)
Net Capital Assets
Being Depreciated 42,873,843 (360,338)
Total Capital Assets,
Net of Depreciation $ 43,794,110 $ (109,559) $ 714,769
Balance
12/31/12
$ 130,918
325,359
$ 456,277
$ 12,941,407
46,639,553
1,585,489
61,166,449
(7,400, 719)
(9,833,061)
{1,419,164)
(18,652,944)
42,513,505
$ 42,969,782
Page 21
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VII -LONG-TERM DEBT
Long-term obligation activity for the year ended December 31, 2013 is as follows:
Balance
1/01/13 -----Additions Deductions
Balance
12/31/13
Current
Portion
Sewer System Revenue Bonds $ 2,580,000 ==$ ==-$ 280,000 $ 2,300,000 $ 295,000
Long-term obligation activity for the year ended December 31, 2012 is as follows:
Balance
1/01/12 Additions Deductions
Balance
12/31/12
Current
Portion
Sewer System Revenue Bonds $ 2,850,000 ==$====-$ 270,000 $ 2,580,000 $ 280,000
Revenue Bonds
The following bonds have been issued as of December 31, 2013:
Date of
Issue
Interest
Rate
Principal
Payable
Interest
Payable
Original
Amount
Sewer System Revenue Bonds 3/1/2005 3.5 -4.0% 5/1/06-20 5/1 & 11/1 $ 4,225,000
Revenue bonds debt service requirements to maturity follows:
Balance
Outstanding
Year Principal Interest Total 12/31
2013 $ 2,300,000
2014 $ 295,000 $ 83,625 $ 378,625 2,005,000
2015 305,000 72,673 377,673 1,700,000
2016 320,000 60,950 380,950 1,380,000
2017 330,000 48,435 378,435 1,050,000
2018 345,000 35,100 380,100 705,000
2019 -2020 705,000 28,300 733,300
Totals $ 2,300,000 $ 329,083 $ 2,629,083
Page 22
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VII -LONG-TERM DEBT (continued)
The Sewer System Revenue Bonds are not general obligations of the City of Muskego and are
payable from the income and revenues derived from the operation of the system. The utility has
established separate funds, as described in Note 1, to account for the allocation of the Utility's
gross revenues in compliance with the debt covenants. The sewer system and the earnings of
the system remain subject to the lien until the principle and interest on the bonds are paid in full.
The principal and interest paid during the year on the Sewer System Revenue Bonds was
$373,835 in 2013 and $373,460 in 2012. Total net revenue as defined by the bond covenants for
the same periods was $1,044,546 and $1,097,220, respectively. Annual principal and interest
payments are expected to require 40% of the net revenues.
Deferred Amount on Refunding
Deferred amounts on refunding arise from advance refunding of debt. The difference between
the cost of the securities placed in trust for future payment of refunded debt and the net carrying
value of that debt is deferred and amortized as a component of interest expense over the shorter
of the term of the refunding issue or the original term of the refunded debt. The unamortized
amount is reported as a deferred outflow of resources in the proprietary fund statements.
Amortization for 2013 and 2012 was $45,333 and $45,333, respectively.
Page 23
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VIII -NET POSITION
Net position reported on the statement of net position at December 31, 2013 and 2012 include the
following:
2013 2012
Net investment in capital assets
Land $ 130,918 $ 130,918
Construction in progress 69,656 325,359
Other capital assets net of accumulated depreciation 42,018,865 42,513,505
Less: related long-term debt outstanding (2,247, 112) (2,481,780)
Plus: non-capital debt proceeds 380,950 380,951
Total net investment in capital assets 40,353,277 40,868,953
Restricted Net Position
Debt service 196,667 186,667
Equipment replacement funds 816,801 789,851
RCA 5,587,268 5,299,674
Total Restricted Net Position 6,600,736 6,276,192
Unrestricted Net Position 10,824,278 10,842,900
Total Utility Net Position $ 57,778,291 $ 57,988,045
When both restricted and unrestricted resources are available for use, it is the Utility's policy to
use restricted assets first, and then unrestricted resources as they are needed.
NOTE IX -RESTATEMENT OF NET POSITION
Net position has been restated as a result of the implementation of GASB Statement No. 65, Items
Previously Reported as Assets and Liabilities, which requires debt issuance costs to be expensed in the
period incurred. The costs were previously required to be capitalized. The details of this restatement are
as follows:
Net Position -December 31, 2011 (as reported) $ 58, 181,633
Less: Unamortized debt issuance costs (48,533)
Net Position -December 31, 2011 (as restated) $ 58, 133, 100
Net income of the prior year would have been increased by $5,943.
Page 24
CITY OF MUSKEGO SEWER UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE X -RISK MANAGEMENT
The utility is exposed to various risks of loss related to torts; theft of, damage to, or destruction
of assets; errors and omissions; workers' compensation; health care of employees and
environmental damage. These risks are covered through the purchases commercial insurance,
with minimal deductions. There has been no reduction in insurance coverage from coverage in
the prior year. Settled claims have not exceeded the insurance coverage in any of the past three
years.
NOTE XI -COMMITMENTS AND CONTINGENCIES
From time to time the utility is party to various pending claims and legal proceedings. Although
the outcome of such matters cannot be forecasted with certainty, it is the opinion of management
that the likelihood is remote that any such claims or proceedings will have a material adverse
effect on the utility's financial position.
Page 25
SUPPLEMENTARY INFORMATION
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
OPERATION AND MAINTENANCE EXPENSES
For the Years Ended December 31, 2013 and 2012
2013 2012
OPERATION AND MAINTENANCE
Milwaukee Metropolitan Sewerage District:
Capital charge $ 3,035,772 $ 2,707,803
User charge 1,048,110 1,033,852
Facility Plan 683 1,633
Town of Norway charges 174,097 203,999
Belle Chasse Oversizing 32,410
Private Property l&I MMSD Program 4,979 38,412
Supervision and labor 449,678 435,283
Supplies and expense 19,693 18,302
Maintenance:
Building and structures 23,992 20, 121
Sewage collection systems 178,484 206,386
Utilities 145,163 116, 172
Transportation expenses 20,068 18,460
5, 133, 129 4,800,423
CUSTOMER ACCOUNT EXPENSES
Accounting and collection 58,795 56,724
Meter expense 28,566 28,746
General expenses:
Office salaries 63,795 61,724
Employees' pensions and benefits 232,333 212,089
Office supplies and expenses 58,955 66,204
Outside services 42,093 49,528
484,537 475,015
TOTAL OPERATION AND MAINTENANCE EXPENSES $ 5,617,666 $ 5,275,438
Page 26
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
UTILITY PLANT IN SERVICE
Forthe Year Ended December 31, 2013
Utilit~ Plant in Service Accumulated De12reciation
Balance Balance Depreciation Balance Balance
12/31/2012 Additions Retirements 12/31/2013 Rate 12/31/2012 Provisions Retirements 12/31/2013
Land $ 130,918 $ -$ $ 130,918 -% $ -$ -$ -$
Buildings and Structures 3,232,803 3,232,803 2.00% 658,256 64,656 722,912
Collecting sewers 41,227,073 542,825 41,769,898 0.80% 7,033,450 331,988 7,365,438
Sewer laterals 5,412,481 68,954 5,481,435 2.50% 2,799,611 136,174 2,935,785
Transportation equipment 792,289 10,349 802,638 10.00% 690,377 79,746 770,123
Other plant equipment 88,268 88,268 4.00% 69,352 3,531 72,883
Lift pump station and equipment 9,708,604 9,708,604 5.00% 6,742,464 485,430 7,227,894
SCADA computer equipment 418,067 418,067 20.00% 418,067 418,067
Computer equipment 33,304 33,304 20.00% 33,304 33,304
Operating equipment 140,588 140,588 20.00% 95,689 15,038 110,727
Office equipment 5,896 5,896 10.00% 5,896 5,896
Meter equipment 5,130 5,130 4.00% 4,532 205 4,737
G/S Mapping 101,946 101,946 25.00% 101,946 101,946
61,297,367 622,128 61,919,495 $ 18,652,944 $1,116,768 $ -$ 19,769,712
CONSTRUCTION IN PROGRESS 325,359 71,290 326,993 69,656
TOTAL UTILITY PLANT $ 61,622,725 $ 693,418 $ 326,993 $ 61,989,151
Page 27
Sewer System Revenue Bonds
Date of
issue
Interest
rate
3/1/2005 3.50-4.00
CITY OF MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
SUMMARY OF LONG-TERM INDEBTEDNESS
As of December 31, 2013
Original Balance
Prinicipal Interest amount outstanding
payable payable of issue Dec.31,2012
5/1/06-20 5/1 & 11/1 4,225,000 $ 2,580,000
ANNUAL PRINCIPAL AND INTEREST PAYMENTS
TO MATURITY ON LONG-TERM INDEBTEDNESS
As of December 31, 2013
Year Principal Interest Total
2014 295,000 83,625 378,625
2015 305,000 72,673 377,673
2016 320,000 60,950 380,950
2017 330,000 48,435 378,435
2018 345,000 35,100 380,100
2019-2020 705,000 28,300 733,300
Total $2,300,000 $ 329,083 $ 2,629,083
Balance Principal
outstanding Interest due
Additions Payments Dec.31,2013 expense 2014
$ -$ 280,000 $ 2,300,000 $ 93,835 $ 295,000
Balance
outstanding
December 31
2,005,000
1,700,000
1,380,000
1,050,000
705,000
Page 28
Project
Projects
Future Projects
Ryan Rd lnterseptor
McShane US Upgrade
Janesville Road Reconstruction
Transfer from working capital
TOTAL
MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
SCHEDULE OF CONSTRUCTION FUNDS
As of and for the Years Ended December 31, 2012 and 2013
Balance 2012 Balance
12/31 /2011 Additions Costs Transfers 12/31/2012
$ 5,171 $ -$ -$ (5,171) $ -
234,341 234,341
10,833 10,833
14,286 14,286
254,289 (254,289)
$ 5,171 $ 254,289 $ 259,460 $ -$ -
2013 Balance
Additions Costs Transfers 12/31/2013
$ -$ -$ -$
22,631 22,631
10,349 10,349
48,659 48,659
81,639 (81,639)
$ 81,639 $ 81,639 $ -$
Page 29
MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATISTICAL INFORMATION
As of December 31, 2013 and 2012
UTILITY CONNECTIONS AT DECEMBER 31,
Type of Customer
Residential
Commercial
Industrial
Public Authority
TOTAL
Number of Connections
2013 2012
6,813 6,768
274 272
63 63
36 35
7,186 7,138
Page 30
MUSKEGO SEWER UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
SCHEDULE OF INSURANCE IN FORCE
As of December 31, 2013
Coverage Insurer Type of coverage Amount
1/1/13-1/1/14 R & R Insurance SeNices, Inc. Workers Comp. Bodily injury by disease $ 500,000
Employee Liab. Bodily injury by accident 100,000
Bodily injury by disease 100,000
1/1/13-1/1/14 R & R Insurance Services, Inc. Commercial General aggregate limit 6,000,000
General Liab. Medical expense limit 10,000
Damages to rented premises, each 250,000
Completed operation limit 6,000,000
Personal and advertising injury limit 6,000,000
Each occurrence limit 6,000,000
1/1/13-1/1/14 R & R Insurance SeNices, Inc. Police Prof. Police professional aggregate limit 6,000,000
Liability Each wrongful act limit 6,000,000
Medical expense limit 10,000
1/1/13-1/1/14 R & R Insurance Services, Inc. Business Combined liability 6,000,000
Auto Uninsured motorist 100,000
Auto medical 1,000
Comprehensive/Collision Actual Value
1/1/13-1/1/14 R & R Insurance SeNices, Inc. Crime Employee dishonesty 1,000,000
Policy Theft, disappearance 25,000
1/1/13-1/1/14 State of Wisconsin Property Ins. Building, personal property 49,727,424
Contractors equipment 2,529,484
1/1/13-1/1/14 R & R Insurance SeNices, Inc. Public Official Aggregate liability 600,000
Employee Liab. Ins.
1/1/13-1/1/14 R & R Insurance Services, Inc. Ind. Employee Bonds Clerk-Treasurer 100,000
Judge 100,000
Court Clerk 100,000
This schedule is prepared from insurance policies, and is intended only as a descriptive summary; no expression of opinion as to the
adequacy of coverage is intended. The coverages indicated above are those of the City of Muskego, of which the Sewer Utility is a
Proprietary-Enterprise Fund of the City.
Limit
Each
Each
Each
Bond
Bond
Bond
Page 31
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
Muskego, Wisconsin
FINANCIAL STATEMENTS
Including Independent Auditor's Report
As of and for the Years Ended
December 31, 2013 and 2012
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
TABLE OF CONTENTS
As of and for the Years Ended December 31, 2013 and 2012
Independent Auditors' Report
Financial Statements
Statements of Net Position
Statements Revenues, Expenses and Changes in Net Position
Statements of Cash Flows
Notes to Financial Statements
Supplementary Information
Operation and Maintenance Expenses
Utility Plant in Service
Schedule of Construction Funds
1 - 2
3-4
5
6-7
8-22
23
24
25
To the Mayor and Common Council
City of Muskego Water Public Utility
Muskego, Wisconsin
INDEPENDENT AUDITORS' REPORT
Report on the Financial Statements
~AKER TILLY
Baker Tilly Virchow Krause, LL P
777 E Wisco nsi n Ave, 32nd Floor
Milwaukee, W I 53202-53 13
eel 414 777 55 00
fax 4 14 777 5555
bakertilly.com
We have audited the accompanying financial statements of the City of Muskego Water Public Utility, an
enterprise fund of the City of Muskego , Wisconsin, as of and for the years ended December 31, 2013, and
2012, and the related notes to the financial statements , as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of
financial statements that are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We conducted
our audits in accordance with auditing standards generally accepted in the United States of America . Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obta in audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors' judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments , the auditor considers internal control relevant to the City of Muskego Water Public Utility's
p reparation and fair presentation of the f inancial statements in order to design audit procedures that are
appropriate in the c ircumstances but not for the purpose of expressing an opinion on the effect iveness of the
City of Muskego Water Public Utility's internal control. Accordingly, we express no such opinion . An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
~ an1~d!!1J~norrlm!:"i"l:Jt>roi
BAKER TILLY
INTERNATI ONAL
Page 1
An Affirmative Accion Equal Oppo[[unicy Employer
To the Mayor and Common Council
City of Muskego
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial
position of the City of Muskego Water Public Utility as of December 31, 2013 and 2012, and the changes in its
financial position and, where applicable, cash flows for the year then ended in accordance with accounting
principles generally accepted in the United States of America.
Emphasis of Matter
As discussed in Note I, the financial statements present only the City of Muskego Water Public Utility enterprise
fund and do not purport to, and do not present fairly the financial position of the City of Muskego, Wisconsin, as
of December 31, 2013, and 2012, and the changes in its financial position and, where applicable, its cash flows
for the years then ended, in accordance with accounting principles generally accepted in the United States of
America. Our opinion is not modified with respect to this matter.
As discussed in Note I, the City of Muskego Water Public Utility adopted the provisions of GASB Statement No.
65, Items Previously Reported as Assets and Liabilities, effective January 1 , 2013. The prior year has been
restated for this change. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Management has omitted Management's Discussion and Analysis that accounting principles generally accepted
in the United States of America require to be presented to supplement the financial statements. Such missing
information, although not a part of the financial statements, is required by the Governmental Accounting
Standards Board who considers it to be an essential part of financial reporting for placing the financial
statements in an appropriate operational, economic, or historical context. Our opinion on the financial
statements is not affected by this missing information.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The
supplementary information as listed in the table of contents is presented for purposes of additional analysis and
is not a required part of the 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 financial
statements. The information has been subjected to the auditing procedures applied in the audit of the financial
statements and certain additional procedures, including comparing and reconciling such information directly to
the underlying accounting and other records used to prepare the financial statements or to the financial
statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion, the supplementary information is fairly stated in all
material respects, in relation to the financial statements as a whole.
~~777Lr Yt;..d11w ~rauu, uP
Milwaukee, Wisconsin
August 6, 2014
Page2
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF NET POSITION
As of December 31, 2013 and 2012
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Accounts receivable -net
Prepaid items
Restricted assets
Redemption account
Cash and cash equivalents
Total Current Assets
NONCURRENT ASSETS
Restricted assets
Reserve account
Cash and cash equivalents
Depreciation account
Cash and cash equivalents
Construction funds
Cash and cash equivalents
Reserve capacity assessments
Cash and cash equivalents
Water capacity assessments receivable
Utility Plant
Plant in service
Accumulated depreciation
Construction work in progress
Other Assets
Special assessments receivable
Total Noncurrent Assets
Total Assets
2013
$ 9,635
447,773
500
280,932
738,840
636,824
328,765
713,875
443,206
104,615
37,535,410
(8,869,302)
304,759
120,814
31,318,966
32,057,806
2012 (Restated)
$ 78,044
441,828
348,387
868,259
646,919
303,765
952,507
172,940
102,471
37,181,425
(8,092,524)
161,815
147,281
31,576,599
32,444,858
Page 3
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF NET POSITION
(Continued)
As of December 31, 2013 and 2012
LIABILITIES AND NET POSITION
2013 2012 (Restated)
CURRENT LIABILITIES
Accounts payable $ 37,281 $ 23,491
Accrued vacation, sick leave and compensatory time 103,825 99,540
Unearned lease revenue 71,928 68,968
Liabilities payable from restricted assets
Accounts payable 183,698
Current portion of long-term debt 507,286 1,857,648
Accrued interest payable 34,783 34,221
Total Current Liabilities 938,801 2,083,868
NONCURRENT LIABILITIES
Long-term debt 5,503,308 4,722,156
Unearned revenue 60,227 58,525
Total Noncurrent Liabilities 5,563,535 4,780,681
Total Liabilities 6,502,336 6,864,549
DEFERRED INFLOWS OF RESOURCES
Unearned revenue 12,678 12,754
NET POSITION
NET POSITION
Net investment in capital assets 24,127,275 24,270,338
Restricted
Equipment replacement 328,765 303,765
Water capacity assesssments 541,757 271,179
Debt Service 246,149 314,166
Unrestricted 298,846 408,107
TOT AL NET POSITION $ 25,542,792 $ 25,567,555
See accompanying ntoes to financial statements. Page 4
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
For the Years Ended December 31, 2013 and 2012
2013 2012 (Restated)
OPERATING REVENUES
Charges for services and sales $ 1,749,555 $ 1,857,360
Other operating revenues 128,500 133,852
Total Operating Revenues 1,878,055 1,991,212
OPERATING EXPENSES
Operation and maintenance 730,443 631,991
Depreciation 754,943 761,861
Taxes 26,152 23,527
Total Operating Expenses 1,511,538 1,417,379
Operating Income 366,517 573,833
NONOPERATING REVENUES (EXPENSES)
Investment income 15,200 17,629
Interest on long term debt (205,888) (214,060)
Amortization of bond premium 18,938 18,938
Bond issuance costs (24,625) (19,102)
Total Nonoperating Revenues (Expenses) (196,375) (196,595)
Income Before Capital Contributions and Transfers 170,142 377,238
CAPITAL CONTRIBUTIONS 396,131 219,988
INTERFUND TRANSFERS
Tax equivalent (591,036) (577,659)
CHANGE IN NET POSITION (24,763) 19,567
NET POSITION -Beginning of Year (as restated) 25,567,555 25,547,988
NET POSITION -END OF YEAR $ 25,542,792 $ 25,567,555
See accompanying notes to financial statements. Page 5
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2013 and 2012
2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 1,599,404 $ 1,730,180
Receipts from municipality for services 309,000 309,000
Payments to suppliers (437,848) (366,825)
Payments to employees (311,432) (286,798)
Net Cash Provided by Operating Activities 1,159,124 1,385,557
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Transfers paid to municipality for tax equivalent (591,036) (577,659)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from capital debt 1,260,000 135,708
Debt issuance costs paid (24,625)
Premium received on debt issued 47,375
Acquisition and construction of capital assets (44,058) (273,353)
Principal paid on long term debt (1,857,648) (564,092)
Interest paid on long term debt (205,325) (215,596)
Collections on special assessments 151,668 187,099
Net Cash Provided by (Used in)
Capital and Related Financing Activities (672,613) (730,234)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment income
Interest on investments 2,443 3,917
Interest on special assessments 12,757 13,712
Net Cash Provided by Investing Activities 15,200 17,629
Net Change in Cash and Cash Equivalents (89,325) 95,293
CASH AND CASH EQUIVALENTS-Beginning of Year 2,502,562 2,407,269
CASH AND CASH EQUIVALENTS -END OF YEAR $ 2,413,237 $ 2,502,562
CASH AND CASH EQUIVALENTS -END OF YEAR
Unrestricted $ 9,635 $ 78,044
Restricted
Redemption account 280,932 348,387
Reserve account 636,824 646,919
Construction Fund 713,875 952,507
Reserve capacity assessments 443,206 172,940
Depreciation Fund 328,765 303,765
$ 2,413,237 $ 2,502,562
Page 6
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
STATEMENTS OF CASH FLOWS
(Continued)
For the Years Ended December 31, 2013 and 2012
NON CASH INVESTING, CAPITAL AND FINANCING ACTIVITIES
Capital additions contributed
to the Utility by customers and developers
Assessments of benefits for property owners for improvements
Amortization of premium on debt
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Operating income
Adjustments to reconcile operating income to
net cash flows from operating activities
Depreciation expense
Depreciation charged to other accounts
Changes in Assets and Liabilities
Accounts receivable
Prepaid items
Accounts payable
Accrued expenses
Unearned revenue
Unearned lease revenue
Net Cash Provided by Operating Activities
See accompanying notes to financial statements.
$
$
$
$
$
2013 2012
273,056 ==$==7=9==,0=7=2
123,075 $ 140,916 ========
18,938 $ =======
366,517 $ 573,833
754,943 761,861
25,795 24,415
(8,591) 11,487
(500)
13,790 12, 116
4,285 915
(76) 12,754
2,961 {11,824)
1,159,124 $ 1,385,557
Page 7
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of City of Muskego Water Public Utility (utility) have been prepared in
conformity with accounting principles generally accepted in the United States of America as applied to
enterprise funds of governmental units. The Governmental Accounting Standards Board (GASB) is the
accepted standard-setting body for establishing governmental accounting and financial reporting
principles.
The significant accounting principles and policies utilized by the utility are described below:
REPORTING ENTITY
The utility is a separate enterprise fund of the City of Muskego (municipality). The utility is managed by
the City of Muskego's Common Council. The utility provides water service to properties within the
municipality.
The water utility operates under service rules and rates established by the Public Service Commission
of Wisconsin (PSCW).
MEASUREMENT Focus, BASIS OF ACCOUNTING AND BASIS OF PRESENTATION
The utility is presented as an enterprise fund of the municipality. Enterprise funds are used to account
for operations that are financed and operated in a manner similar to private business or where the
governing body has decided that the determination of revenues earned, costs incurred and net income
is necessary for management accountability.
The financial statements are reported using the economic resources measurement focus and the
accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when
earned and expenses are recorded when the liability is incurred or economic asset used. Revenues,
expenses, gains, losses, assets and liabilities resulting from exchange and exchange-like transactions
are recognized when the exchange takes place.
In March 2012, the Governmental Accounting Standards Board (GASB) issued Statement No. 65 -
Items Previously Reported as Assets and Liabilities. This statement clarifies the appropriate reporting
of deferred outflows of resources and deferred inflows of resources to ensure consistency in financial
reporting. Previous financial reporting standards did not include guidance for these elements, which
are distinct from assets and liabilities.
The utility implemented this standard effective January 1, 2012. The adoption of this standard had a
significant effect on the utility's financial statements. Refer to Note VIII.
Page 8
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
MEASUREMENT Focus, BASIS OF ACCOUNTING AND BASIS OF PRESENTATION (cont.)
Preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
ASSETS, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET POSITION
Cash and Investments
For purposes of the statement of cash flows, cash and cash equivalents have original maturities of
three months or less from the date of acquisition.
Investment of utility funds is restricted by state statutes. Investments are limited to:
1. Time deposits in any credit union, bank, savings bank or trust company maturing in three years
or less.
2. Bonds or securities of any county, city, drainage district, technical college district, village, town,
or school district of the state. Also, bonds issued by a local exposition district, local
professional baseball park district, local professional football stadium district, local cultural arts
district or by the University of Wisconsin Hospitals and Clinics Authority.
3. Bonds or securities issued or guaranteed by the federal government.
4. The local government investment pool.
5. Any security maturing in seven years or less and having the highest or second highest rating
category of a nationally recognized rating agency.
6. Securities of an open end management investment company or investment trust, subject to
various conditions and investment options.
7. Repurchase agreements with public depositories, with certain conditions.
The utility has not adopted a formal investment policy and is covered under an investment policy
adopted by the municipality. Please reference the City of Muskego financial statements for details of
this investment policy and its assessment of deposit and investment risks.
Investments are stated at fair value, which is the amount at which an investment could be exchanged
in a current transaction between willing parties. Fair values are based on quoted market prices. No
investments are reported at amortized cost. Adjustments necessary to record investments at fair value
are recorded in the operating statement as increases or decreases in investment income.
Page 9
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
ASSETS, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET POSITION (cont.)
Receivables/Payables
Transactions between the utility and other funds of the municipality that are representative of
lending/borrowing arrangements outstanding at year end are referred to as advances to/from other
funds. All other outstanding balances between the utility and other funds of the municipality are
reported as due to/from other funds.
The utility has the right under Wisconsin statutes to place delinquent water bills on the tax roll for
collection. As such, no allowance for uncollectible customer accounts is considered necessary.
Restricted Assets
Mandatory segregations of assets are presented as restricted assets. Such segregations are required
by bond agreements and other external parties. Current liabilities payable from these restricted assets
are so classified.
The various revenue bond resolutions require segregation of the proceeds of the bond issue and the
creation and continual funding of several accounts from operating revenue as described below:
1. Operation and Maintenance Fund - A monthly amount equal to the estimated current expenses
for such month and for the following two months.
2. Special Redemption Fund -Principal and Interest: A monthly amount equal to one-sixth (1/6) of
the next installment of interest coming due and an amount equal to one-twelfth (1/12) of the
installment of principal of the bonds coming due on the next succeeding principal payment
date.
3. Special Redemption Fund -Reserve: A monthly amount equal to the total Reserve Account
requirements divided by twelve until the amount accumulated in the Reserve Account totals
125% of the average debt service on the outstanding bonds.
4. Depreciation Fund -An annually determined amount to finance the acquisition of capital
equipment identified in the annual budget which is not financed by a revenue bond issue.
5. Surplus Fund -Any amount remaining after the above monthly transfers have been completed.
Restricted net position represent Water Capacity Assessment Funds, Depreciation Funds and Special
Redemption Fund -Principal and Interest Fund restricted assets less accrued interest payable from
restricted assets.
Page 10
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and tor the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
ASSETS, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET POSITION (cont.)
Restricted Assets (cont.)
Also, special assessment cash collections which are segregated tor the future payment of debt service
requirements are classified as restricted assets.
Construction Funds (restricted) represent proceeds from long-term debt and interest earnings on the
related funds which are expected to be utilized to finance certain construction projects in the
subsequent year.
Special Assessments Receivable
This account represents the balances of special assessments levied against property owners tor
infrastructure improvements. The balances are receivable over various time periods with interest
accrued annually.
Unearned Special Assessments
The balance of this account consists of amounts that will be assessed to property owners when
specific property is annexed by the municipality or until vacant land is developed.
Capital Assets
Capital assets are defined by the utility as assets with an initial, individual cost of more than $5,000
and an estimated useful lite in excess of one year.
Capital assets of the utility are recorded at cost or the fair market value at the time of contribution to
the utility. Major outlays tor utility plant are capitalized as projects are constructed. Interest incurred
on borrowed funds during the construction phase is reflected in the capitalized value of the utility plant
constructed, net of interest earned on the invested proceeds over the same period. $0 of net interest
was capitalized during the current year and the prior year. Capital assets in service are depreciated
using the straight-line method over the following useful lives:
Buildings and improvements
Improvements other than buildings -
utilities distribution system
Machinery and equipment
Deferred Inflows of Resources
Years
33-44
19 -90
4 -17
A deterred inflow of resources represents an acquisition of net position that applies to a future period
and therefore will not be recognized as an inflow of resources (revenue) until that future time.
Page 11
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
ASSETS, LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET POSITION (cont.)
Compensated Absences
Under terms of employment, employees are granted sick leave and vacations in varying amounts. Only
benefits considered to be vested are disclosed in these statements. Vested vacation and sick leave
pay is accrued when earned in the financial statements. The liability is liquidated from general
operating revenues of the utility.
Long-Term Obligations
Long-term debt and other obligations are reported as utility liabilities. Bond premiums and discounts
are deferred and amortized over the life of the bonds using the effective interest method. The balance
at year end for premiums is shown as an increase in the liability section of the statement of net
position. The bond discounts are reported as unearned charges.
Unearned Revenues
Unearned revenues principally represent deferred special assessments which will be reported as
contributed capital when and if the property owner connects to the system and the assessment
becomes due and unearned revenue on cell tower leases.
Equity Classifications
Equity is classified as net position and displayed in three components:
a. Net investment in capital assets -Consists of capital assets including restricted capital assets,
net of accumulated depreciation and reduced by the outstanding balances (excluding unspent
debt proceeds) of any bonds, mortgages, notes, or other borrowings that are attributable to the
acquisition, construction, or improvement of those assets.
b. Restricted net position -Consists of net position with constraints placed on their use either by 1)
external groups such as creditors, grantors, contributors, or laws or regulations of other
governments or, 2) law through constitutional provisions or enabling legislation.
c. Unrestricted net position -All other net positions that do not meet the definitions of "restricted"
or "net investment in capital assets."
REVENUES AND EXPENSES
The utility distinguishes operating revenues and expenses from non-operating items. Operating
revenues and expenses generally result from providing services and producing and delivering services
in connection with the utility's principal ongoing operations. The principal operating revenues of the
utility are charges to customers for services. Operating expenses for enterprise funds include the cost
of services, administrative expenses, and depreciation on capital assets. All revenues and expenses
not meeting this definition are reported as non-operating revenues and expenses.
Page 12
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
REVENUES AND EXPENSES (cont.)
Operating Revenues
Utility billings are rendered and recorded quarterly based on metered usage at rates authorized by the
Public Service Commission.
Taxes
Municipal utilities are exempt from federal and state income taxes. Taxes included in the financial
statements are social security taxes and the Public Service Commission remainder assessment.
Capital Contributions
Cash and capital assets are contributed to the utility from customers, the municipality or external
parties. The value of property contributed to the utility is reported as revenue on the statements of
revenues, expenses and changes in net position.
lnterfund Transfer
The utility records an annual payment in lieu of taxes (PILOT) expense based on the value of its plant
and the current assessment ratio and local and school portion of the mill rate.
Effect of New Accounting Standards on Current Period Financial Statement
The Governmental Accounting Standards Board (GASB) has approved the following:
• Statement No. 67, Financial Reporting for Pension Plans -an amendment of GASB Statement
No. 25
• Statement No. 68, Accounting and Financial Reporting for Pensions -an amendment of GASB
Statement No. 27
• Statement No. 69, Government Combinations and Disposals of Government Operations
• Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees
When they become effective, application of these standards may restate portions of these financial
statements.
Comparative Data
Certain amounts presented in the prior year data may have been reclassified in order to be consistent
with the current year's presentation.
Page 13
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE II -CASH, CASH EQUIVALENTS AND TEMPORARY INVESTMENTS
The Water Public Utility's cash and cash equivalents at year-end consisted of the following:
Associated
2013 2012 Risk
Cash and cash equivalents held by the City:
Commingled cash and investments with City $ 1,391,047 $ 1,481,384 Not applicable
Wisconsin's Local Government Investment Pool 1,022,190 1,021,178 Credit risk
Total $ 2,413,237 $ 2,502,562
Reconciliation to financial statements
Unrestricted cash and investments $ 9,635 $ 78,044
Restricted cash and investments
Redemption account -current 280,932 348,387
Reserve account -non-current 636,824 646,919
Depreciation account -non-current 328,765 303,765
Construction funds -non-current 713,875 952,507
Reserve capacity assessments -non-current 443,206 172,940
Total Cash and Investments $ 2,413,237 $ 2,502,562
Deposits in each local and area bank are insured by the FDIC in the amount of $250,000 for time and
savings accounts (including NOW accounts) and $250,000 for demand deposit accounts (interest-
bearing and noninterest-bearing). In addition, if deposits are held in an institution outside of the state
in which the government is located, insured amounts are further limited to a total of $250,000 for the
combined amount of all deposit accounts.
Bank accounts are also insured by the State Deposit Guarantee Fund (SDGF) in the amount of
$400,000. However, due to the nature of this fund, recovery of material principle losses may not be
significant to individual municipalities.
The Utility, as a Proprietary-Enterprise Fund of the City of Muskego, maintains commingled cash and
investment accounts with the City, except for its investment in the Pool. Federal depository insurance
and the State Guarantee Fund insurance apply to the City of Muskego as an individual municipality
and, accordingly, the amount of insured funds is not determinable for the Utility as a Proprietary-
Enterprise Fund of the City. Also please refer to the City's financial statements for information on risks
on the Utility's cash and investments with the City.
Page 14
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE II -CASH, CASH EQUIVALENTS AND TEMPORARY INVESTMENTS (cont.)
The Wisconsin Local Government Investment Pool (LGIP) is part of the State Investment Fund (SIF),
and is managed by the State of Wisconsin Investment Board. The SIF is not registered with the
Securities and Exchange Commission, but operates under the statutory authority of Wisconsin Chapter
25. The SIF reports the fair value of its underlying assets annually. Participants in the LGIP have the
right to withdraw their funds in total on one day's notice. At December 31, 2013 and 2012 the fair value
of the Utility's share of the LGIP assets was substantially equal to the amount reported above.
Credit Risk
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligation.
As of December 31, 2013 and 2012 the utility had funds invested in LGIP. LGIP is unrated.
See Note I Assets, Liabilities and Net Position -Cash and Investments for further information.
NOTE Ill -RESTRICTED ASSETS
Restricted assets were comprised of the following restricted funds at December 31, 2013 and 2012:
2013 2012
Cash and Cash Equivalents
Special Redemption Funds
Bond Reserve Fund $ 636,824 $ 646,919
Bond Principal and Interest Fund 280,932 348,387
Total 917,756 995,306
Other Debt Sevice Funds 443,206 172,940
Construction Funds (financed by debt) 713,875 952,507
Depreciation Funds 328,765 303,765
Total cash and cash equivalents 2,403,602 2,424,518
Water capacity assessments receivable 104,615 102,471
Total $ 2,508,217 $ 2,526,989
Current assets $ 280,932 $ 348,387
Noncurrent assets 2,227,285 2,178,602
Total $ 2,508,217 $ 2,526,989
Page 15
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE IV • DEFINED BENEFIT PENSION PLAN
All eligible City of Muskego employees participate in the Wisconsin Retirement System (WRS}, a cost-
sharing, multiple employer, defined benefit, public employee retirement system. All employees initially
employed by a participating WRS employer prior to July 1, 2011, expected to work at least 600 hours
and expected to be employed for at least one year from employee's date of hire, are eligible to
participate in the WRS. All employees initially employed by a participating WRS employer on or after
July 1, 2011, and expected to work at least 1200 hours a year and expected to be employed for at
least one year from employee's date of hire are eligible to participate in the WRS.
Effective the first day of the first pay period on or after June 29, 2011, the employee required
contribution was changed to one-half of the actuarially determined contribution rate for employees in
the General Employment category, and Executives and Elected Officials. Required contributions for
protective contributions are the same rate as general employees. Employers are required to contribute
the remainder of the actuarially determined contribution rate. The employer may not pay the employee
required contribution unless provided for by an existing collective bargaining agreement.
Contribution rates for 2013, 2012, and 2011 were:
2013 General Category
2012 General Category
2011 General Category
Employee
6.65%
5.9%
7.05%
Employer
6.65%
5.9%
7.05%
The payroll for City of Muskego employees covered by the WRS for the years ended December 31,
2013, 2012, and 2011 was $310,015, $287,713, and $290,727. The total required contribution for the
year ended December 31, 2013 was $31,413, which consisted of 6.65% of payroll from the employer
6.65% of payroll from employees. Total contributions for the years ending December 31, 2012 and
2011 were $34,051 and $33,724, respectively, equal to the required contributions for each year.
Employees who retire at or after age 65 (62 for elected officials and 54 for protective occupation
employees with less than 25 years of service, 53 for protective occupation employees with more than
25 years of service) are entitles to receive a retirement benefit. Employees may retire at age 55 (50
for protective occupation employees) and receive actuarially reduced benefits. The factors influencing
the benefit are: (1) final average earnings, (2) years of creditable service and (3) a formula factor. A
final average earnings is the average of the employee's three highest years' earnings. Employees
terminating covered employment and submitting application before becoming eligible for a retirement
benefit may withdraw their contributions and, by doing so, forfeit all rights to any subsequent benefit.
For employees beginning participation on or after January 1, 1990 and no longer actively employed on
or after April 24, 1998, creditable service in each of five years is required for eligibility for a retirement
annuity. Participants employed prior to 1990 and on or after April 24, 1998 and prior to July 1, 2011
are immediately vested. Participants who initially became WRS eligible on or after July 1, 2011 must
have five years of creditable service to be vested.
Details of the plan are also disclosed in the basic financial statements of the City of Muskego.
Page 16
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE V-CHANGES IN CAPITAL ASSETS
A summary of changes in capital assets for 2013 and 2012 follows:
Balance Balance
1 /1/13 Additions Retirements 12/31/13
Capital assets, not being depreciated
Intangible easements $ 36,500 $ -$ -$ 36,500
Land and land rights 29,148 29,148
Total Capital Assets Not Being
Depreciated or Amortized 65,648 65,648
Capital assets being depreciated
Buildings and improvements 7,245,470 7,245,470
Improvements other than
buildings 27,079,991 273,057 27,353,048
Machinery and equipment 2,790,316 84,888 3,960 2,871,244
Total Capital Assets
Being Depreciated 37,115,777 357,945 3,960 37,469,762
Total Capital Assets 37,181,425 357,945 3,960 37,535,410
Less: Accumulated depreciation
Buildings and improvements (1,500,070) (194,401) (1,694,471)
Improvements other than
buildings (4,907,681) (463,760) (5,371,441)
Machinery and equipment {1,684,773) (122,577) (3,960) (1,803,390)
Total accumulated depreciation (8,092,524) (780,738) (3,960) (8,869,302)
Construction in progress 161,815 142,944 304,759
Net Utility Plant $ 29,250,716 $ (279,849) $ -$ 28,970,867
Page 17
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE V-CHANGES IN CAPITAL ASSETS (cont.)
Balance Balance
1/1 /12 Additions Retirements 12/31/12
Capital assets, not being depreciated
Intangible easements $ 36,500 $ -$ -$ 36,500
Land and land rights 29,148 29,148
Total Capital Assets Not Being
Depreciated or Amortized $ 65,648 $ -$ -$ 65,648
Capital assets being depreciated
Buildings and improvements 7,245,470 7,245,470
Improvements other than
buildings 27,003,060 76,931 27,079,991
Machinery and equipment 2,757,801 37,839 5,324 2,790,316
Total Capital Assets
Being Depreciated 37,006,331 114,770 5,324 37,115,777
Total Capital Assets 37,071,979 114,770 5,324 37, 181,425
Less: Accumulated depreciation
Buildings and improvements (1,305,669) (194,401) (1,500,070)
Improvements other than
buildings (4,447,017) (460,664) (4,907,681)
Machinery and equipment (1,558,886) (131,211) (5,324) (1,684,773)
Total accumulated depreciation (7,311,572) (786,276) (5,324) (8,092,524)
Construction in progress 27,201 211,547 76,933 161,815
Net Utility Plant $ 29,787,608 $ (459,959) $ 76,933 $ 29,250,716
Page 18
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VI -LONG-TERM DEBT
A. The transactions related to long-term debt for the years ending December 31 , 2013 and 2012 are
summarized below:
Balance Balance Current
01/01/13 Increases Decreases 12/31/13 Portion
Waterworks System
Revenue Bonds $ 4,515,000 $ -$ 475,000 $ 4,040,000 $ 375,000
General Obligation Debt 1,565,060 1,260,000 1,362,485 1,462,575 111,585
WI Safe Drinking Water Loan 426,664 20,163 406,501 20,701
Unamortized debt premium 73,080 47,376 18,938 101,518
$ 6,579,804 $ 1,307,376 $ 1,876,585 $ 6,010,594 $ 507,286
Balance Balance Current
01/01/12 Increases Decreases 12/31/12 Portion
Waterworks System
Revenue Bonds $ 4,990,000 $ -$ 475,000 $ 4,515,000 $ 475,000
General Obligation Debt 1,640,760 75,700 1,565,060 1,362,485
WI Safe Drinking Water Loan 304,348 135,708 13,392 426,664 20, 163
Unamortized debt premium 92,018 18,938 73,080
$ 7,027, 126 $ 135,708 $ 583,030 $ 6,579,804 $ 1,857,648
B. Details of long-term debt outstanding at December 31, 2013 are as follows:
Date of Interest Principal Interest Original Balance
Tu2g Loan Rate Payable Payable Amount 12/31/2013
Waterworks System
Revenue Bonds 09/01/08 3.5-5.25 05/01 /09-28 5/1&11/1 $ 2,450,000 $ 2,050,000
Waterworks System
Revenue Refunding Bonds 11/08/11 2-4 05/01 /12-20 5/1&11/1 2,740,000 1,990,000
General Obligation Bonds 03/01/05 2.6-3.7 03/01 /06-15 3/1&9/1 600,000 202,575
General Obligation Bonds 10/22/13 2-4 04/01/14-31 4/1&10/1 820,000 820,000
General Obligation Bonds 10/22/13 2-3.125 04/01 /14-23 4/1 &10/1 440,000 440,000
WI Safe Drinking Water Loan 11/25/09 2.668 05/01/10-29 5/1&11/1 22,699 406,501
5,909,076
Less: Current portion of long-term debt 507,286
$ 5,401,790
Page 19
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VI -LONG-TERM DEBT(cont.)
C. The Waterworks System Revenue Bonds are not general obligations of the City of Muskego
and are payable from the income and revenues derived from the operation of the system. The
Utility has established separate funds, as described in Note I, to account for the allocation of
the Utility's gross revenues in compliance with the debt resolutions. The General Obligation
Debt is secured by the full faith and credit of the City. The Wisconsin Safe Drinking Loan
disbursement of financial assistance represents 5% of the Municipal obligations as required by
the IRS to consummate the Municipal Obligation closing. A principal amount of $375,000 is
available in the form of Water System Revenue Bonds.
D. Annual principal and interest payments to maturity on long-term debt payable are as follows.
Balance
Outstanding
Year Principal Interest Total 12/31
$ 5,909,076
2014 $ 507,286 $ 208,701 $ 715,987 5,401,790
2015 535,343 197,143 732,486 4,866,447
2016 453,220 184,395 637,615 4,413,227
2017 477,177 171,319 648,496 3,936,050
2018 515,700 155,809 671,509 3,420,350
2019-2023 1,761, 186 546,071 2,307,257 1,659, 164
2024-2028 1,365,812 229,609 1,595,421 293,352
2029-2031 293,352 16,465 309,817
$ 5,909,076 $ 1,709,512 $ 7,618,588
E. All utility revenues net of specified operating expenses are pledged as security of the above
revenue bonds until the bonds are defeased. Principal and interest paid for 2013 and 2012
were $634,794 and $779,686, respectively. Total customer gross revenues as defined for the
same periods were $1.5 million and $1.4 million. Annual principal and interest payments are
expected to require 23% of gross revenues on average.
Page 20
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE VII -NET POSITION
Net position reported on the statement of net position at December 31, 2013 and 2012 include the following:
2013 2012
Net investment in capital assets
Land and land rights $ 29,148 $ 29,148
Intangible easements 36,500 36,500
Construction in progress 304,759 161,815
Other capital assets net of accumulated depreciation 28,600,460 29,023,253
Less: related long-term debt outstanding (5,909,076) (6,506,724)
Plus: non-capital debt proceeds 636,824 646,919
Plus: unpsent bond proceeds 530,178 952,507
Plus: debt premium {101,518) {73,080)
Total net investment in capital assets 24,127,275 24,270,338
Restricted Net Position
Debt service 246,149 314,166
Equipment replacement funds 328,765 303,765
Reserve capacity assessments 541,757 271,179
Total Restricted Net Position 1, 116,671 889,110
Unrestricted Net Position 298,846 408,107
Total Utility Net Position $ 25,542,792 $ 25,567,555
When both restricted and unrestricted resources are available for use, it is the Utility's policy to use
restricted assets first, and then unrestricted resources as they are needed.
NOTE VIII -RESTATEMENT OF NET POSITION
Net position has been restated as a result of the implementation of GASB Statement No. 65, Items
Previously Reported as Assets and Liabilities, which requires debt issuance costs to be expensed in
the period incurred. These costs were previously required to be capitalized. The details of this
restatement are as follows:
Net Position -December 31, 2011 (as reported)
Unamortized debt issuance
costs
Net Position -December 31, 2011 (as restated)
Net income of the prior year would have been increased by $19, 102.
$
$
25,622,922
(74,934)
25,547,988
Page 21
CITY OF MUSKEGO WATER PUBLIC UTILITY
A Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the Years Ended December 31, 2013 and 2012
NOTE IX -ANTENNA LEASE AGREEMENTS
The Utility has lease agreements with cellular phone companies to lease a water tower as a site for
cellular antennas. The initial term of the leases were five years with the right to extend the leases for
four additional five year terms.
Rental income of $107,908 and $103,587 from rental of the water tower, for the years 2013 and 2012,
respectively, is reported in other operating revenues.
Future minimum rentals related to these leases are as follows:
NOTE X -RISK MANAGEMENT
2014
2015
2016
Total
$ 113,461
119,134
125,091
$ 357,686
The Water Utility is exposed to various risks of loss related to torts; theft of, damage to, or destruction
of assets; errors and omissions; natural disasters; workers' compensation and environmental damage.
These risks are covered through the purchases of commercial insurance. The general aggregate
insurance coverage limits decreased $1.0 million from coverage in the prior year. Insurance
settlements for claims resulting from the risks covered by commercial insurance have not exceeded the
insurance coverage in any of the past three years.
NOTE XI -WATER RATES
The utility implemented the current rates effective October 1, 2011.
NOTE XII -COMMITMENTS AND CONTINGENCIES
From time to time the Water Utility becomes involved in legal actions and claims, most of which
normally occur in governmental utility operations. These legal actions and claims are generally
defended by various insurance carriers, since claims brought against the Utility are generally covered
by insurance policies. In the opinion of management, any legal actions and claims, and any other
proceedings known to exist at December 31, 2013, are not likely to have a material adverse impact on
the Utility's financial position.
Page 22
SUPPLEMENTARY INFORMATION
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
OPERATION AND MAINTENANCE EXPENSES
For the Years Ended December 31, 2013 and 2012
2013 2012
SOURCE OF SUPPLY
Operation labor $ 1,063 $ 783
Maintenance of water source plant 7,131 5,806
Total Source of Supply 8,194 6,589
PUMPING EXPENSES
Operation labor 68,441 64,708
Fuelorpowerpurohased 95,485 91,652
Operation supplies and expenses 21 21
Maintenance of pumping plant 6,155 3,656
Total Pumping Expenses 170, 102 160,037
WATER TREATMENT EXPENSES
Operation labor 6,414 4,222
Chemicals 25,585 17,739
Maintenance of water treatment plant 558 898
Total Water Treatment Expenses 32,557 22,859
TRANSMISSION AND DISTRIBUTION EXPENSES
Operation labor 56,664 52,006
Operation supplies and expenses 10,293 5,996
Maintenance of distribution reservoirs 7,806 4,104
Maintenance of mains 51,536 13,780
Maintenance of services 5,755 2,078
Maintenance of meters 1,182 3,090
Maintenance of hydrants 16,506 20,612
Maintenance of other plant 1,772 1,124
Total Transmission and Distribution Expenses 151,514 102,790
CUSTOMER ACCOUNT EXPENSES
Meter reading labor 1,808 1,628
Accounting and collecting labor 13,746 12,891
Supplies and expenses 11,513 11,052
Total Customer Account Expenses 27,067 25,571
ADMINISTRATIVE AND GENERAL EXPENSES
Administrative and general salaries 136,918 126,871
Office supplies and expenses 31,409 21, 196
Outside services 39,086 42,097
Property insurance 14,200 15,460
Employee pensions and benefits 97,626 85,778
Miscellaneous general expenses 5,118 6,051
Transportation expense 16,652 16,692
Total Administrative and General Expenses 341,009 314,145
TOTAL OPERATION AND MAINTENANCE EXPENSES $ 730,443 $ 631,991
Page 23
UTILITY PLANT IN SERVICE
For the Years Ended December 31, 2013 and 2012
Utility Plant in Service Accumulated DeRreciation
Balance Balance Depreciation Balance Balance
12/31/2012 Additions Retirements 12/31/2013 Rate 12/31/2012 Provisions Retirements 12/31/2013
INTANGIBLE PLANT
Easements $ 36,500 $ -$ -$ 36,500 -% $ -$ -$ $
Organization 29,148 29,148 -%
SOURCE OF SUPPLY
Well 1,578,016 1,578,016 2.90% 545,815 45,763 591,578
PUMPING PLANT
Structures and improvements 4,427,645 4,427,645 3.20% 830,275 141,684 971,959
Electric pumping equipment 1,580,707 1,580,707 4.40% 820,277 69,551 889,828
TREATMENT PLANT
Water treatment equipment 12,469 12,469 6.00% 9,186 748 9,934
TRANSMISSION AND DISTRIBUTION PLANT
Reservoirs and standpipes 1,796,702 1,796,702 1.90% 395,078 34,137 429,215
Transmission and distribution lines 19,689,983 184,732 19,874,715 1.30% 2,722,105 257,171 2,979,276
Services 3,746,135 58,610 3,804,745 2.90% 1, 125,758 109,488 1,235,246
Meters 898,735 74,539 3,960 969,314 5.50% 556,908 51,589 3,960 604,537
Hydrants 2,847,173 29,715 2,876,888 2.20% 680,740 62,965 743,705
GENERAL PLANT
Transportation 171,785 10,349 182,134 13.30% 171,785 688 172,473
Office furniture 19,991 19,991 5.80% 19,991 19,991
Computer equipment 106,628 106,628 26.70% 106,628 106,628
Structures and improvements 239,808 239,808 2.90% 107,978 6,954 114,932
37,181,425 357,945 3,960 37,535,410 $ 8,092,524 780,738 $ 3,960 $ 8,869,302
CONSTRUCTION IN PROGRESS 161,815 142,944 304,759
Less allocation of meter
TOTAL UTILITY PLANT $ 37,343,240 $ 500,889 $ 3,960 $ 37,840, 169 depreciation to the Sewer Utility (25,795)
$ 754,943
Page 24
Project
Meters and meter transmitters
Truck Acquisition
Janesville Road
Radios
Industrial Park Piping
Belle Chasse Well Site
Pioneer Road
Interest earnings and unallocated
TOTAL
Construction Funds financed by:
Debt proceeds
CITY OF MUSKEGO WATER PUBLIC UTILITY
a Proprietary-Enterprise Fund of the
CITY OF MUSKEGO
SCHEDULE OF CONSTRUCTION FUNDS
As of December 31, 2013
Balance Other
12/31/2012 Sources
$ -$ -
51,624
898,458 (11,645)
2,425 845
$ 952,507 $ (10,800)
$
$
Balance
Costs Transfers 12/31/2013
74,539 $ 274,539 $ 200,000
10,349 102,099 91,750
142,944 232,385 141,065
28,790 28,790
129,000 129,000
120,000 120,000
(886,813)
3,270
227,832 $ -$ 713,875
$ 713,875
Page 25
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
A component-unit of the
CITY OF MUSKEGO
Muskego, Wisconsin
FINANCIAL STATEMENTS
Including Independent Auditors' Report
As of and for the year ended December 31, 2013
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
A component-unit of the
CITY OF MUSKEGO
TABLE OF CONTENTS
As of and for the year ended December 31, 2013
Independent Auditors' Report
BASIC FINANCIAL STATEMENTS
Government-wide Financial Statements
Statement of Net Position
Statement of Activities
Fund Financial Statements
Balance Sheet -Governmental Fund
Statement of Revenues, Expenditures and Changes in Fund Balance
-Governmental Fund
Statement of Revenues, Expenditures and Changes in Fund Balance
-Actual and Budget -General Fund
Notes to Financial Statements
1 - 2
3
4
5
6
7
8 -16
INDEPENDENT AUDITORS ' REPORT
T o the Board of District Commissioners
Big Muskego Lake-Bass Bay Protection
and Rehabilitation District
Muskego, Wisconsin
Report on the Financial Statements
~AKER TILLY
Baker Tilly Virchow Krause, LLP
777 E Wisconsin Ave, 32nd Floor
Milwaukee, WI 53202-5313
tel 414 777 550 0
fax 414 777 555 5
bakenilly.com
We have audited the accompanying financial statements of the governmental activities and the major fund
of the Big Muskego Lake-Bass Bay Protection and Rehabilitation Dist rict {"District"), a component unit of
the City of Muskego, Wisconsin as of and for the year ended December 31 , 2013, and the related notes to
the financial statements , which collectively comprise the District's basic financial statements as listed in
the table of contents .
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financ ial statements in
accordance with accounting princip les generally accepted in the United States of America; this includes
the design , implementation , and maintenance of interna l contro l relevant to the preparat ion and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors ' Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with aud iting standards generally accepted in the United States of
America. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain aud it evidence about the amounts and disclosures in
the financ ial statements. The procedures selected depend on the auditors' judgment, including the
assessment of the risks of material misstatement of the financial statements , whether due to fraud o r
error. In making those risk assessments, the auditor considers internal control relevant to the District's
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of
the District's internal cont rol. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is su ff icient and appropriate to prov ide a bas is for
ou r audi t op inion.
~ Ml ic,aevqnderi! mem:i.~1 of
BAKER TILLY
INTERNATIONAL An Affirmative Action Equal Opportunity Employer
To the Board of District Commissioners
Big Muskego Lake-Bass Bay Protection and Rehabilitation District
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and the major fund of the District, as of
December 31, 2013, and the respective changes in financial position and the respective budgetary
comparison for the General Fund for the year then ended in conformity with accounting principles
generally accepted in the United States of America.
Other Matter
Required Supplementary Information
The District has not presented the management's discussion and analysis that accounting principles
generally accepted in the United States of America require to be presented to supplement the basic
financial statements. Such missing information, although not a part of the basic financial statements, is
required by the Governmental Accounting Standards Board who considers it to be an essential part of the
financial reporting for placing the basic financial statements in an appropriate operational, economical, or
historical context. Our opinion on the basic financial statements is not affected by this missing information.
~~ "7Lr Jl/~1w e--rauu, uP
Milwaukee, Wisconsin
August 6, 2014
Page 2
BIG MUSKEGO LAKE-BASS BAY PROTECTION AND REHABILITATION DISTRICT
a component unit of the
ASSETS
CURRENT ASSETS
Cash and cash equivalents
CITY OF MUSKEGO
STATEMENT OF NET POSITION
As of December 31 , 2013
Due from the City of Muskego
Total assets
LIABILITIES
CURRENT LIABILITIES
Unearned revenue
Total liabilities
NET POSITION
Unrestricted
See accompanying notes to financial statements.
$ 96,061
3,607
$ 99,668
$ 4
4
$ 99,664
Page 3
BIG MUSKEGO LAKE-BASS BAY PROTECTION AND REHABILITATION DISTRICT
a component unit of the
CITY OF MUSKEGO
STATEMENT OF ACTIVITIES
For the year ended December 31, 2013
Expenses
Functions
Program
Revenues
Charges for
Services
Net (Expense)
Revenue and
Changes
in Net Position
General government
Weed treatment
Total activities
$ 83,033 $ - $ (83,033)
20,395
General revenues
Investment earnings
Other revenues
Total activities
Change in Net Position
NET POSITION, BEGINNING OF YEAR
NET POSITION, END OF YEAR
8,290 28,685
$ 91,323 $ 28,685
==========~
See accompanying notes to financial statements.
$
(62,638)
42
387
429
(62,209)
161,873
99,664
Page 4
BIG MUSKEGO LAKE-BASS BAY PROTECTION AND REHABILITATION DISTRICT
ASSETS
Cash and cash equivalents
Due from the City of Muskego
Total assets
LIABILITIES AND FUND EQUITY
Liabilities:
Unearned revenues
Total liabilities
Fund equity -fund balance
Committed
Total fund equity
Total liabilities and fund equity
a component unit of the
CITY OF MUSKEGO
BALANCE SHEET
GOVERNMENT AL FUND
As of December 31, 2013
See accompanying notes to financial statements.
$
$
$
$
General
Fund
96,061
3,607
99,668
4
4
99664
99,664
99,668
Page 5
BIG MUSKEGO LAKE-BASS BAY PROTECTION AND REHABILITATION DISTRICT
a component unit of the
CITY OF MUSKEGO
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
GOVERNMENTAL FUND
For the year ended December 31, 2013
General
Fund
REVENUES
Public charges for services -assessments $ 28,685
Investment income 42
Other revenues 387
Total revenues 29,114
EXPENDITURES
Current:
Salaries and benefits 4,762
Accounting and auditing 1,150
Insurance 175
Postage 681
Computer charges 175
Miscellaneous 1,017
Land conservancy 73
Weed treatment 8,290
Economic development 75,000
Total expenditures 91,323
Net change in Fund Balance (62,209)
FUND BALANCE, BEGINNING OF YEAR 161,873
FUND BALANCE, END OF YEAR $ 99,664
See accompanying notes to financial statements.
Page6
BIG MUSKEGO LAKE-BASS BAY PROTECTION AND REHABILITATION DISTRICT
a component unit of the
CITY OF MUSKEGO
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE -ACTUAL AND BUDGET
GENERAL FUND
For the year ended December 31, 2013
Original
and Final
Actual Budget
REVENUES
Public charges for services -assessments $ 28,685 $ 28,730
Investment income 42 50
Other revenues 387
Total revenues 29, 114 28,780
EXPENDITURES
Current:
Salaries and benefits 4,762 4,642
Accounting and auditing 1, 150 1,200
Insurance 175 175
Postage 681 1,200
Computer charges 175 175
Dues/conventions 1,000
Legal fees 1,500
Maintenance of equipment 1,500
Miscellaneous 1,017 1,000
Gasoline, oil, grease, tires 73 500
Water quality monitoring 750
Goose control 3,000
Weed treatment 8,290 16,000
Economic development 75,000 100,000
Total expenditures 91,323 132,642
Net change in Fund Balance (62,209) $ (103,862)
FUND BALANCE, BEGINNING OF YEAR 161,873
FUND BALANCE, END OF YEAR $ 99,664
See accompanying notes to financial statements.
Variance with
Final Budget
$ (45)
(8)
387
334
(120)
50
519
1,000
1,500
1,500
(17)
427
750
3,000
7,710
25,000
41,319
$ 41,653
Page 7
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the Big Muskego Lake-Bass Bay Protection and Rehabilitation District
conform to accounting principles generally accepted in the United States of America as applicable
to governmental units. The accepted standard-setting body for establishing governmental
accounting and financial reporting principles is the Governmental Accounting Standards Board
(GASB).
A. REPORTING ENTITY
The Big Muskego Lake-Bass Bay Protection and Rehabilitation District the "District" is a
component unit of the City of Muskego.
These financial statements do not include the balances and transactions of the City of Muskego.
Therefore, these financial statements are not intended to, and do not present the financial position
and results of operations of the City of Muskego.
The District was established by a resolution of the Common Council of the City of Muskego on
September 12, 1978 under authority of the Statutes of the State of Wisconsin.
The District was established for the purpose of undertaking programs of lake protection and
rehabilitation. The District is comprised of property and territory lying within the boundaries of the
City of Muskego. The governing body or District Commissioners shall be the members of the
Common Council of the City of Muskego with the Mayor acting as Chairman.
In order to carry out the program of lake protection and rehabilitation, the District may do the
following:
1. Make contracts, accept gifts, purchase, lease, devise or otherwise acquire,
hold or dispose of real or personal property.
2. Disburse money, contract debt and do such other acts as are necessary to
carry out the program.
3. Borrow money or issue Special Assessment "B" Bonds for financing projects.
4. Apply for state aids as provided by statute.
5. Levy special assessments in order to carry out District projects.
6. Approve a budget.
7. Levy a tax upon all taxable property within the District for the cost of operation
for the ensuing year which tax shall not exceed a rate of 2.5 mills of equalized
valuation.
Page 8
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
8. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
In November 2010, the GASB issued statement No. 61 -The Financial Reporting Entity: Omnibus
-an amendment of GASB Statements No. 14 and No. 34. This statement modifies certain
requirements for inclusion of component units in the financial reporting entity.
This standard was implemented effective January 1, 2013, but had no material effect on the
District.
In March 2012, the GASB issued statement No. 65 -Items Previously Reported as Assets and
Liabilities. This statement establishes accounting and financial reporting standards that reclassify,
as deferred outflows of resources or deferred inflows of resources, certain items that were
previously reported as assets and liabilities and recognizes, as outflows of resources or inflows of
resources, certain items that were previously reported as assets and liabilities.
This standard was implemented effective January 1, 2013, but had no material effect on the
District.
Government-wide Financial Statements
The statement of net position and statement of activities display information about the reporting
government as a whole. They include all funds of the reporting entity except for fiduciary funds.
The statements distinguish between governmental and business-type activities. Governmental
activities generally are financed by user charges, intergovernmental revenues, and other
nonexchange revenues. The District does not report any business-type activities, or fiduciary
funds.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment are offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. The District does not allocate indirect expenses to
functions in the statement of activities. Program revenues included 1) charges to customers or
applicants who purchase, use or directly benefit from goods, services, or privileges provided by a
given function or segment and 2) grants and contributions that are restricted to meeting the
operational or capital requirements of a particular function or segment. Other items not properly
included among program revenues are reported instead as general revenues.
Fund Financial Statements
Financial statements of the reporting entity are organized into funds, each of which are considered
to be a separate accounting entity. Each fund is accounted for by providing a separate set of self-
balancing accounts, which constitute its assets, liabilities, net position/fund equity, revenues, and
expenditures.
Page 9
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (cont.)
Fund Financial Statements (cont.)
Funds are organized as major funds or non-major funds within the governmental statements. An
emphasis is placed on major funds within the governmental category. A fund is considered major
if it is the primary operating fund of the organization or meets the following criteria:
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual
governmental are at least 10% of the corresponding total for all funds of that
category or type, and
b. The same element of the individual governmental fund that met the 10% test is at
least 5% of the corresponding total for all governmental funds combined.
c. In addition, any other governmental fund that the District believes if particularly
important to financial statement users may be reported as a major fund.
The District reports the following governmental fund:
Major Fund -General Fund -accounts for the District's general operating activities. It is used
to account for all financial resources except those required to be accounted for in another
fund.
c. MEASUREMENT Focus, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION
Government-Wide Statements
The government-wide statement of net position and statement of activities are reported using the
economic resources measurement focus and the accrual basis of accounting. Under the accrual
basis of accounting, revenues are recognized when earned and expenses are recorded when the
liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets, and
liabilities resulting from exchange and exchange-like transactions are recognized when the
exchange takes place. Grants and similar items are recognized as revenue as soon as all
eligibility requirements imposed by the provider are met.
Page 10
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
c. MEASUREMENT Focus, BASIS OF ACCOUNTING,
AND FINANCIAL STATEMENT PRESENTATION (cont.)
Fund Statements
Governmental funds financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recorded when
they are both measurable and available. Available means collectible within the current period or
soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the
District considers revenues to be available if they are collected within 60 days of the end of the
current fiscal period. Expenditures are recorded when the related fund liability is incurred, except
for claims and judgments, which are recorded as a fund liability when expected to be paid with
expendable available financial resources.
All Financial Statements
The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenditures/expenses during
the reporting period. Actual results could differ from those estimates.
0. EQUITY CLASS/FICA TIONS
Government-Wide Statements
Equity is classified as net position and displayed in three components:
a. Net investment in capital assets -Consists of capital assets including restricted capital
assets, net of accumulated depreciation and reduced by the outstanding balances
(excluding unspent debt proceeds) of any bonds, mortgages, notes, or other borrowings
that are attributable to the acquisition, construction, or improvement of those assets.
b. Restricted net position -Consists of net position with constraints placed on the use either
by 1) external groups such as creditors, grantors, contributors, or laws or regulations of
other governments or, 2) law through constitutional provisions or enabling legislation.
c. Unrestricted net position -All other net positions that do not meet the definition of
"restricted" or "net investment in capital assets."
When both restricted and unrestricted resources are available for use, it is the District's policy to
use restricted resources first, then unrestricted resources as they are needed.
Page 11
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
D. EQUITY CLASSIFICATIONS (cont.)
Fund Statements
Governmental fund equity is classified as fund balance and displayed as follows:
a. Nonspendable -Includes fund balance amounts that cannot be spent either because
they are not in spendable form or because legal or contractual requirements require
them to be maintained intact.
b. Restricted -Consists of fund balances with constraints place on their use either by 1)
external groups such as creditors, granters, contributors, or laws or regulations of
other governments or 2) law through constitutional provisions or enabling legislation.
c. Committed -Includes fund balance amounts that are constrained for specific purposes
that are internally imposed by the government through formal action of the highest
level of decision making authority. Fund balance amounts are committed through a
formal action (resolution) of the Board of District Commissioners. This formal action
must occur prior to the end of the reporting period, but the amount of the commitment,
which will be subject to the constraints, may be determined in the subsequent period.
Any changes to the constraints imposed require the same formal action of the District
that originally created the commitment.
d. Assigned -Includes spendable fund balance amounts that are intended to be used for
specific purposes that are not considered restricted or committed. Fund balance may
be assigned through the following; 1) The District has adopted a financial policy
authorizing the Board of District Commissioners to assign amounts for a specific
purpose. 2) All remaining positive spendable amounts in governmental funds, other
than the general fund, that are neither restricted nor committed. Assignments may take
place after the end of the reporting period.
e. Unassigned -Includes residual positive fund balance within the general fund which has
not been classified within the other above mentioned categories. Unassigned fund
balance may also include negative balances for any governmental fund if expenditures
exceeds amounts restricted, committed, or assigned for those purposes.
The District considers restricted amounts to be spent first when both restricted and
unrestricted fund balance is available unless there are legal documents I contracts that
prohibit doing this, such as in grant agreements requiring dollar for dollar spending.
Additionally, the District would first use committed, then assigned and lastly unassigned
amounts of unrestricted fund balance when expenditures are made.
E. OTHER POLICIES
1. The District owns certain capital assets with insignificant values that have been excluded
for the financial statement reporting.
2. The District adopts annual budgets for its Governmental Fund which is prepared on
a basis consistent with generally accepted accounting principles. All appropriations
lapse at year-end. Budgetary control is exercised at the total fund level.
Page 12
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 2 -CASH AND CASH EQUIVALENTS
The Big Muskego Lake -Bass Bay Protection and Rehabilitation District, a component unit of the
City of Muskego, invests its funds in accordance with the provisions of the Wisconsin Statutes
66.0603 and 67.11 (2).
The District's carrying values and bank balances of cash and cash equivalents as of December
31, 2013 consisted of the following:
Carrying Bank Associated
Value Balance Risks
Cash and cash equivalents
Demand deposits $ 44,185 $ 119,185 Custodial Credit Risk
Commingled cash and investments
with the City 19,899 Not applicable Not Applicable
LGIP 31,977 $ 31,977 Credit Risk
Total Cash and Cash Equivalents $ 96,061
Deposits in each local and area bank are insured by the FDIC in the amount of $250,000 for time
and saving accounts (including NOW accounts) and $250,000 for demand deposit accounts
(interest-bearing and noninterest-bearing). In addition, if deposits are held in an institution outside
of the state in which the government is located, insured amounts are further limited to a total of
$250,000 for the combined amount of all deposit accounts
Bank accounts are also insured by the State Deposit Guarantee Fund in the amount of $400,000.
However, due to the nature of this fund, recovery of material principal losses may not be
significant to individual municipalities. This coverage has been considered in computing custodial
credit risk.
Custodial Credit Risk
Custodial credit risk is the risk that in the event of a financial institution failure, the District's
deposits may not be returned to the District. As of December 31, 2013, the District's total bank
balance of $119, 185 was fully insured.
Credit Risk
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its
obligation.
The District had investments in the external Wisconsin Local Government Investment Pool which
is not rated.
Page 13
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 2 -CASH AND CASH EQUIVALENTS (cont.)
The District has not adopted a formal investment policy and is covered under an investment policy
adopted by the City of Muskego. Please reference the City of Muskego financial statements for
details of this investment policy and its assessment of deposit and investment risks on
commingled cash and investments.
The District, as a component unit of the City of Muskego, also maintains commingled cash and
investment with the City. Federal depository insurance and the State of Wisconsin Guarantee
Fund insurance apply to the City of Muskego as an individual municipality and accordingly, the
amount of insured funds is not determinable for the Big Muskego Lake -Bass Bay Protection and
Rehabilitation District as a component unit of the City.
Investments are stated at fair value, which is the amount at which an investment could be
exchanged in a current transaction between willing parties. Fair values are based on quoted
market prices. No investments are reported at amortized cost. Adjustments necessary to record
investments at fair value are recorded in the operating statement as increases or decreases in
investment income. Investment income on commingled investments of municipal accounting funds
is allocated based on average balances. The difference between the bank statement balance and
carrying value is due to outstanding checks and/or deposits in transit.
The Wisconsin Local Government Investment Pool (LGIP) is part of the State Investment Fund
(SIF), and is managed by the State of Wisconsin Investment Board. The SIF is not registered with
the Securities and Exchange Commission, but operates under the statutory authority of Wisconsin
Chapter 25. The SIF reports the fair value of its underlying assets annually. Participants in the
LGIP have the right to withdraw their funds in total on one day's notice. At December 31, 2013, the
fair value of the District's share of the LGIP's assets was substantially equal to the amount as
reported in these statements.
NOTE 3 -RISK MANAGEMENT
The District is exposed to various risks of loss related to torts; theft of, damage to, or destruction
of assets; errors and omissions; workers compensation; health care of its employees; and
environmental damage for which the District purchases commercial insurance. Settled claims
have not exceeded the commercial coverage in any of the past three years. There were no
significant reductions in coverage compared to the prior year.
Page 14
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 4 -OTHER INFORMATION
A. EMPLOYEE RETIREMENT SYSTEM
All eligible District employees participate in the Wisconsin Retirement System (WRS), a cost-
sharing, multiple-employer, defined benefit, public employee retirement system. All employees,
initially employed by a participating WRS employer prior to July 1, 2011, expected to work over
600 hours a year and expected to be employed for at least one year from employee's date of hire
are eligible to participate in the WRS. All employees, initially employed by a participating WRS
employer on or after July 1, 2011, and expected to work at least 1,200 hours a year and expected
to be employed for at least one year from employee's date of hire are eligible to participate in the
WRS.
Effective the first day of the first pay period on or after June 29, 2011 the employee required
contribution was change to one-half of the actuarially determined contribution rate for General
category employees, and Executives and Elected Officials. Required contributions for protective
contributions are the same as general employees. Employers are required to contribute the
remainder of the actuarially determined contribution rate. The employer may not pay the
employee required contribution unless provided for by an existing collective bargaining agreement.
Contribution rates for December 31, 2013 are:
General
Employee
6.65%
Employer
6.65%
The payroll for District employees covered by the WRS for the year ended December 31, 2013
was $3,087; the employer's total payroll was $3,087. The total required contribution for the year
ended December 31, 2013 was $211 or 6.8% of covered payroll. Of this amount, 100% was
contributed for the current year. Total contributions for the years ending December 31, 2012 and
2011 were $195 and $269, respectively, equal to the required contributions for each year.
Employees who retire at or after age 65 (62 for elected officials and 54 for protective occupation
employees with less than 25 years of service, 53 for protective occupation employees with more
than 25 years of service) are entitled to receive a retirement benefit. Employees may retire at age
55 (50 for protective occupation employees) and receive actuarially reduced benefits. The factors
influencing the benefit are: (1) final average earnings, (2) years of creditable service, and (3) a
formula factor. Final average earnings is the average of the employee's three highest years
earnings. Employees terminating covered employment and submitting application before
becoming eligible for a retirement benefit may withdraw their contributions and, by doing so, forfeit
all rights to any subsequent benefit. For employees beginning participation on or after January 1,
1990, and no longer actively employed on or after April 24, 1998, creditable service in each of five
years is required for eligibility for a retirement annuity. Participants employed prior to 1990 and on
or after April 24, 1998 and prior to July 1, 2011 are immediately vested. Participants who initially
became WRS eligible on or after July 1, 2011 must have five years of creditable service to be
vested.
The WRS also provides death and disability benefits for employees. Eligibility and the amount of
all benefits is determined under Chapter 40 of Wisconsin Statutes. The WRS issues an annual
financial report which may be obtained by writing to the Department of Employee Trust Funds,
P.O. Box 7931, Madison, WI 53707-7931.
Page 15
BIG MUSKEGO LAKE -BASS BAY PROTECTION
AND REHABILITATION DISTRICT
a component-unit of the
CITY OF MUSKEGO
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended December 31, 2013
NOTE 4 -OTHER INFORMATION (cont.)
8. EFFECT OF NEW ACCOUNTING STANDARDS ON CURRENT-PERIOD FINANCIAL STATEMENTS
The Governmental Accounting Standards Board (GASB) has approved the following:
• Statement No. 67, Financial Reporting for Pension Plans -an amendment of GASB
Statement No. 25
• Statement No. 68, Accounting and Financial Reporting for Pensions -an amendment of
GASB Statement No. 27
• Statement No. 69, Government Combinations and Disposals of Government Operations
• Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial
Guarantees
When they become effective, application of these standards may restate portions of these
financial statements.
Page 16
CITY OF MUSKEGO
Muskego, Wisconsin
COMMUNICATION TO THOSE CHARGED WITH GOVERNANCE
AND MANAGEMENT
As of and for the Year Ended December 31, 2013
CITY OF MUSKEGO
TABLE OF CONTENTS
Required Communication of Internal Control Related Matters Identified in the
Audit to Those Charged with Governance
Internal Controls Over Financial Reporting
Other Communications to Those Charged with Governance
Two Way Communication Regarding Your Audit
Communication of Other Control Deficiencies, Recommendations and Informational Points
to Management that are not Material Weaknesses or Significant Deficiencies
Required Communications by the Auditor to Those Charged with Governance
Management Representations
Page No.
1
2
3-4
5-7
8-11
REQUIRED COMMUNICATION OF INTERNAL CONTROL RELATED MATTERS IDENTIFIED IN THE
AUDIT TO THOSE CHARGED WITH GOVERNANCE
To the Honorable Mayor and Common Council
City of Muskego
Muskego, Wisconsin
~AKER TILLY
Baker Tilly Virchow Krause, LLP
777 E Wisconsin Ave, 32nd Floor
Milwaukee, WI 53202-5313
tel 414 777 5500
fax 414 777 5555
bakercilly.com
In planning and performing our audit of the financial statements of the City of Muskego as of and for the year
ended December 31, 2013, in accordance with auditing standards generally accepted in the United States of
America, we considered its internal control over financial reporting (internal control) as a basis for designing our
auditing procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the
financial statements, but not for the purpose of expressing an opinion on the effectiveness of its internal control.
Accordingly, we do not express an opinion on the effectiveness of its internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and was
not designed to identify all deficiencies in internal control that might be material weaknesses or significant
deficiencies and, therefore, material weaknesses or significant deficiencies may exist that were not identified.
However, as discussed below, we identified certain deficiencies in internal control that we consider to be
material weaknesses.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis . A material weakness is a deficiency, or combination of deficiencies in internal
control, such that there is a reasonable possibility that a material misstatement of the entity's financial
statements will not be prevented, or detected and corrected, on a timely basis. We consider the following
deficiencies in the City of Muskego's internal control to be material weaknesses, as discussed further on the
following pages:
> Internal Control Over Financial Reporting
This communication is intended solely for the information and use of management, those charged with
governance, and others within the organization and is not intended to be, and should not be, used by anyone
other than these specified parties.
Milwaukee, Wisconsin
August 6, 2014
~ar.1nclependentmemberot
BAKER TILLY
INTERNATIONAL
Page 1
An Affirm ati ve Action Equ al Opp ortuni ty Emplo yer
INTERNAL CONTROL OVER FINANCIAL REPORTING
Auditing standards require that we perform procedures to obtain an understanding of your government
and its internal control environment as part of the annual audit. This includes an analysis of significant
transaction cycles and an analysis of the City's year-end financial reporting process and preparation of
your financial statements.
Properly designed systems of internal control provides your organization with the ability to process and
record monthly and year end transactions and prepare annual financial reports.
Our audit includes a review and evaluation of the city's internal controls relating to financial reporting.
Common attributes of a properly designed system of internal control for financial reporting are as follows:
> There is adequate staffing to prepare financial reports throughout and at the end of the year.
> Staff is properly trained and knowledgeable to perform all financial reporting functions.
> Material misstatements are identified and corrected during the normal course of duties.
> Complete and accurate financial statements including footnotes are prepared.
> Financial reports are reviewed by an individual who is not the preparer for completeness and
accuracy.
To accomplish the goal of establishing a sound system of internal control over financial reporting, will
require continuing education for the City's Finance Director on courses directed at establishing and
improving knowledge of governmental generally accepted accounting principles and external reporting.
Management has also advised us to work closely the City's Finance Director to provide her with
necessary technical guidance to help her develop the process for the complete preparation of all the
City's financial statements by her department within the next few years.
In 2007, the Finance Director began the process of preparing certain City financial statements. We are
pleased to report that in 2013, the Finance Department provided us with a complete set of Sewer and
Water Utility financial statements, which were prepared to our satisfaction and required only minor
changes. In 2013, the Finance Director also prepared the City's financial statements, with our assistance.
We will continue to work with the Finance Director to ensure that all statements are materially accurate
and prepared independently by the City.
Page2
OTHER COMMUNICATIONS TO THOSE CHARGED WITH GOVERNANCE
TWO WAY COMMUNICATION REGARDING YOUR AUDIT
As part of our audit of your financial statements, we are providing communications to you throughout the
audit process. Auditing requirements provide for two-way communication and are important in assisting
the auditor and you with more information relevant to the audit.
As this past audit is concluded, we use what we have learned to begin the planning process for next
year's audit. It is important that you understand the following points about the scope and timing of our
next audit:
a. We address the significant risks of material misstatement, whether due to fraud or error, through
our detailed audit procedures.
b. We will obtain an understanding of the five components of internal control sufficient to assess the
risk of material misstatement related to the financial statements whether due to error or fraud, and
to design the nature, timing, and extent of further audit procedures. We will obtain a sufficient
understanding by performing risk assessment procedures to evaluate the design of controls
relevant to an audit of the financial statements and to determine whether they have been
implemented. We will use such knowledge to:
> Identify types of potential misstatements.
> Consider factors that affect the risks of material misstatement.
> Design tests of controls, when applicable, and other audit procedures.
We will not express an opinion on the effectiveness of internal control over financial reporting or
compliance with laws, regulations, and provisions of contracts or grant programs.
c. The concept of materiality recognizes that some matters, either individually or in the aggregate,
are important for fair presentation of financial statements in conformity with generally accepted
accounting principles while other matters are not important. In performing the audit, we are
concerned with matters that, either individually or in the aggregate, could be material to the
financial statements. Our responsibility is to plan and perform the audit to obtain reasonable
assurance that material misstatements, whether caused by errors or fraud, are detected.
d. Your financial statements contain components, as defined by auditing standards generally
accepted in the United States of America, which we also audit.
Page3
TWO WAY COMMUNICATION REGARDING YOUR AUDIT (cont.)
We are very interested in your views regarding certain matters. Those matters are listed here:
a. We typically will communicate with your top level of management unless you tell us otherwise.
b. We understand that the City and Common Council have the responsibility to oversee the strategic
direction of your organization, as well as the overall accountability of the entity. Management has
the responsibility for achieving the objectives of the entity.
c. We need to know your views about your organization's objectives and strategies, and the related
business risks that may result in material misstatements.
d. Which matters do you consider warrant particular attention during the audit, and are there any
areas where you request additional procedures to be undertaken?
e. Have you had any significant communications with regulators or grantor agencies?
f. Are there other matters that you believe are relevant to the audit of the financial statements?
Also, is there anything that we need to know about the attitudes, awareness, and actions of the City
concerning:
a. The City's internal control and its importance in the entity, including how those charged with
governance oversee the effectiveness of internal control?
b. The detection or the possibility of fraud?
We also need to know if you have taken actions in response to developments in financial reporting, laws,
accounting standards, governance practices, or other related matters, or in response to previous
communications with us.
With regard to the timing of our audit, here is some general information. We will perform preliminary
financial audit work during the months of October-December. Our final financial fieldwork is scheduled
during the spring to best coincide with your readiness and report deadlines. After fieldwork, we wrap up
our financial audit procedures at our office and may issue drafts of our report for your review. Final copies
of our report and other communications are issued after approval by your staff. This is typically 6-12
weeks after final fieldwork, but may vary depending on a number of factors.
Keep in mind that while this communication may assist us with planning the scope and timing of the audit,
it does not change the auditor's sole responsibility to determine the overall audit strategy and the audit
plan, including the nature, timing, and extent of procedures necessary to obtain sufficient appropriate
audit evidence.
We realize that you may have questions or wish to provide other feedback. We welcome the opportunity
to hear from you.
Page 4
COMMUNICATION OF OTHER CONTROL DEFICIENCIES, RECOMMENDATIONS AND
INFORMATIONAL POINTS TO MANAGEMENT THAT ARE NOT MATERIAL WEAKNESSES OR
SIGNIFICANT DEFICIENCIES
DEPARTMENTAL CONTROLS
As part of our annual audit process, we focus our efforts on the primary accounting systems, internal
controls, and procedures used by the City. This is in keeping with our goal to provide an audit opinion
which states that the financial statements of the City are correct in all material respects.
In some cases, the primary system of accounting procedures and controls of the City are supported by
smaller systems which are decentralized, and reside within a department or location. In many cases,
those systems are as simple as handling cash collections and remitting those collections to the City
treasurer. In other cases, the department may send invoices or statements of amounts due, and track
collections of those amounts in a standalone accounts receivable system.
Generally, the more centralized a function is, the easier it is to design and implement accounting controls
that provide some level of checks and balances. That is because you are able to divide certain tasks over
the people available to achieve some segregation of duties. For those tasks that are decentralized, it is
usually very difficult to provide for proper segregation of duties. Therefore, with one person being involved
in most or all aspects of a transaction, you lose the ability to rely on the controls to achieve the
safeguarding of assets and reliability of financial records.
As auditors, we are required to communicate with you on a variety of topics. Since there is now more
emphasis on internal controls and management's responsibilities, we believe it is appropriate to make
sure that you are informed about the lack of segregation of duties that may occur at departments or
locations that handle cash or do miscellaneous billing. Examples in your City that fit this situation may
include the following:
Police/Courts
Parks
Recreation Department
As you might expect, similar situations are common in most governments.
As auditors, we are required to focus on the financial statements at a highly summarized level and our
audit procedures support our opinion on those financial statements. Departments or locations that handle
relatively smaller amounts of money are not the primary focus of our audit. Yet, because of the lack of
segregation of duties, the opportunity for loss is higher there than in centralized functions that have more
controls.
Because management is responsible for designing and implementing controls and procedures to detect
and prevent fraud, we believe that is important tor us to communicate this information to you. We have no
knowledge of any fraud that has occurred or is suspected to have occurred within the departments
mentioned above. However, your role as the governing body is to assess your risk areas and determine
that the appropriate level of controls and procedures are in place. As always, the costs of controls and
staffing must be weighed against the perceived benefits of safeguarding your assets.
Without adding staff or splitting up the duties, your own day-to-day contact and knowledge of the
operation are also important mitigating factors.
Page 5
PROFESSIONAL STANDARDS UPDATE/ INFORMATIONAL POINTS
GASB Updates
The following is a schedule of GASS projects:
Task or Event
GASS No. 67-
Financial Reporting for
Pension Plans
GASS No. 68-
Accounting and
Financial Reporting for
Pensions
GASS No. 69-
Government
Combinations and
Disposals of
Government
Operations
GASS No. 70-
Accounting and
Financial Reporting
For Nonexchange
Financial Guarantees
GASS No. 71 -
Pension Transition for
Contributions Made
Subsequent to the
Measurement Date -
an amendment of
GASS No. 68
Current Agenda Topic:
Conceptual
Framework -
Measurement
Effective Date
For fiscal years
beginning after
June 15, 2013. For
the Wisconsin
Retirement System
this will be for the
year ending
December 31, 2014
December 31, 2015
December 31, 2014
December 31, 2015
December 31, 2015
The GASS Board is
scheduled to issue a
final Concepts
Statement in March
2014
Impact
This standard is applicable to the Wisconsin
Retirement System (WRS) or the plan itself. This will
not have a direct impact on the city.
The city belongs to the Wisconsin Retirement System
(WRS). The WRS is a cost-sharing, multiple-employer,
defined-benefit, public employee retirement system.
WRS has represented that it will provide the
information necessary for the employers to implement
GASS No. 68. The city's share of the net pension
liability I asset will be reported in its full-accrual funds
and the government-wide financial statements. The
footnote disclosures will have significant changes.
This standard provides the guidance necessary for
government combinations and disposals of
government operations.
This standard provides guidance for non-exchange
financial guarantees that the city would become
involved in.
The requirements of this Statement will eliminate the
source of a potential significant understatement of
restated beginning net position and expense in the
first year of implementation of GASS No. 68 in the
accrual-basis financial statements of the city. This will
be addressed with the implementation of GASS No.
68.
The objective of this project is to consider the
measurement concepts that should be used in
governmental financial statements. A measurement
approach determines whether an asset or liability
presented in a financial statement should be (1)
reported at an amount that reflects a value at the date
that the asset was acquired or the liability was
incurred or (2) remeasured and reported at an amount
that reflects a value at the date of the financial
statements.
Page 6
PROFESSIONAL STANDARDS UPDATE/ INFORMATIONAL POINTS (continued)
GASB Updates (continued)
Task or Event
Current Agenda
Project: Fair Value
Measurement
Current Agenda
Project: Fiduciary
Responsibilities
Current Agenda
Project: Leases
Current Agenda
Project:
Postemployment
Benefits Accounting
and Financial
Reporting: Other
Postemployment
Benefits Accounting
and Financial
Reporting
Effective Date
The GASB Board is
scheduled to issue
an Exposure Draft in
May 2014
The GASB Board is
expected to issue an
Exposure Draft on
this project in
September 2014
The GASB Board is
scheduled to issue
an Exposure Draft in
November 2014
During the first part
of 2014, the GASB
Board will review
remaining issues
before issuing
Exposure Drafts on
employer and plan
OPEB accounting
and financial
reporting and
pensions not within
the scope of
Statement 68
Impact
The objective of this project is to review and consider
alternatives for the further development of the
definition of fair value, the methods used to measure
fair value and the applicability of fair value guidance to
investments and other items currently reported at fair
value, and the potential disclosures about fair value.
This project is to assess what additional guidance
should be developed regarding the application of the
fiduciary responsibility criteria in deciding whether and
how governments should report fiduciary activities in
their financial reports.
The objective of this project is to reexamine issues
associated with lease accounting, consider
improvements to existing guidance, and provide a
basis for the GASB Board to consider whether the
current guidance is appropriate based on the
definitions of assets and liabilities.
The Board will consider the possibility of modifications
to the existing standards of accounting and financial
reporting for other postemployment benefits (OPEB)
by state and local governmental employers and by the
trustees, administrators, or sponsors of OPEB plans.
GASB has stated that their objectives are to increase
financial reporting transparency and to improve the
usefulness of information to the various users of the
financial statements.
The GASB has two other projects which are on hold. They include the conceptual framework for
recognition and economic condition reporting -financial projections.
The GASB revisits GASB standards ten (10) years after issuance. The GASB is currently revisiting GASB
Statement No. 34, Basic Financial Statements -and Management's Discussion and Analysis for State
and Local Governments, as well as reporting model-related pronouncements including Statements No.
37, Basic Financial Statements -and Management's Discussion and Analysis-for State and Local
Governments; Omnibus, No. 41 , Budgetary Comparison Schedules -Perspective Differences, and No.
46, Net Assets Restricted by Enabling Legislation, and Interpretation No. 6, Recognition and
Measurement of Certain Liabilities and Expenditures in Governmental Fund Financial Statements. The
GASB has indicated that they are revisiting the following major provisions of these standards:
management's discussion and analysis, government-wide financial statements, fund financial statements,
capital asset reporting, budgetary comparisons, special purpose government reporting, and related notes
to financial statements. We will share updates with you as they become available.
A full list of projects as well as many resources are available on GASB's website which is located at
www.gasb.org.
Page 7
REQUIRED COMMUNICATIONS BY THE AUDITOR TO THOSE CHARGED WITH GOVERNANCE
To the Honorable Mayor and Common Council
City of Muskego
Muskego, Wisconsin
Thank you for using Baker Tilly Virchow Krause , LLP as your auditor.
9sAKE R TI LL Y
Baker Tilly Virchow K rause, LLP
7 77 E Wisconsin Ave, 32nd Floor
Milwaukee, WI 53202-5313
tel 414 777 5500
fax 414 777 5555
bakerrilly.com
We have completed our audit of the financial statements of City of Muskego for the year ended December 31 ,
2013 and have issued our report thereon dated August 6, 2014. This letter presents communications required
by our professional standards.
OUR RESPONSIBILITY UNDER AUDITING STANDARDS GENERALLY ACCEPTED
IN THE UNITED STATES OF AMERICA
T he objective of a financial statement audit is the expression of an opinion on the financial statements. We
conducted the audit in accordance with auditing standards generally accepted in the United States of
America. These standards require that we plan and perform our audit to obtain reasonable, rather than
absolute, assurance about whether the financial statements prepared by management with your oversight
are free of material misstatement, whether caused by error or fraud. Our audit included examining, on a tes t
basis, evidence supporting the amounts and disclosures in the financial statements, assessing accounting
principles used and significant estimates made by management, and evaluating the overall financial
statement presentation. Our audit does not relieve management or those charged with governance of their
responsibilities.
As part of the audit, we obtained an understanding of the entity and its environment, including internal
control, sufficient to assess the risks of material misstatement of the financial statements and to design the
nature, timing and extent of further audit procedures. The audit was not designed to provide assurance on
internal control or to identify deficiencies in internal control.
OTHER INFORMATION IN DOCUMENTS CONTAINING AUDITED FINANCIAL STATEMENTS
Our responsibility does not extend beyond the audited financial statements identified in this report. We do not
have any obligation to and have not performed any procedures to corroborate other information contained in
client prepared documents, such as official statements related to debt issues.
PLANNED SCOPE AND TIMING OF THE AUDIT
We performed the audit according to the planned scope and timing previously communicated to you in the
Communication to Those Charged with Governance and Management dated September 12, 2014.
~anmdependen t membe r o f
BAKER TILLY
INTERNATIONA L
Page 8
An Affirmative Action Equal O pportunity Empl oyer
To the Honorable Mayor and the Common Council
City of Muskego
QUALITATIVE ASPECTS OF THE ENTITY'S SIGNIFICANT ACCOUNTING PRACTICES
Accounting Policies
Management is responsible for the selection and use of appropriate accounting policies. In accordance with the
terms of our engagement letter, we will advise management about the appropriateness of accounting policies
and their application. The significant accounting policies used by the City are described in Note 1 to the
financial statements. As described in Note 1 to the financial statements, the City changed accounting policies
related to inclusion of certain component units in the financial reporting entity and their reporting by adopting
Statement of Governmental Accounting Standards (GASB) Statement No. 61, The Financial Reporting Entity:
Omnibus -an amendment of GASB Statements No. 14 and No. 34 and changed accounting policies related to
reporting certain items previously reported as assets and liabilities by adopting Statement No. 65, Items
Previously Reported as Assets and Liabilities in 2013. Accordingly, the cumulative effect of the accounting
change as of the beginning of the year is reported in the Statement of Net Position. We noted no transactions
entered into by the City during the year that were both significant and unusual, and of which, under professional
standards, we are required to inform you, or transactions for which there is a lack of authoritative guidance or
consensus.
QUALITATIVE ASPECTS OF THE ENTITY'S SIGNIFICANT ACCOUNTING PRACTICES (cont.)
Accounting Estimates
Accounting estimates are an integral part of the financial statements prepared by management and are based
on management's knowledge and experience about past and current events and assumptions about future
events. Certain accounting estimates are particularly sensitive because of their significance to the financial
statements and because of the possibility that future events affecting them may differ significantly from those
expected. The most sensitive estimates affecting the financial statements were:
> Accrued compensated absences for vacation and sick leave.
We evaluated the key factors and assumptions used to develop these estimates in determining that it is
reasonable in relation to the financial statements taken as a whole.
Financial Statement Disclosures
The disclosures in the financial statements are neutral, consistent, and clear.
DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT
We encountered no significant difficulties in dealing with management in performing our audit.
CORRECTED AND UNCORRECTED MISSTATEMENTS
Professional standards require us to accumulate all known and likely misstatements identified during the audit,
other than those that are trivial, and communicate them to the appropriate level of management.
There were no such misstatements identified.
DISAGREEMENTS WITH MANAGEMENT
For purposes of this letter, professional standards define a disagreement with management as a matter,
whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter that
could be significant to the financial statements or the auditor's report. We are pleased to report that no such
disagreements arose during the course of our audit.
Page 9
To the Honorable Mayor and the Common Council
City of Muskego
CONSULTATIONS WITH OTHER INDEPENDENT ACCOUNTANTS
In some cases, management may decide to consult with other accountants about auditing and accounting
matters. If a consultation involves application of an accounting principle to the governmental unit's financial
statements or a determination of the type of auditors' opinion that may be expressed on those statements, our
professional standards require the consulting accountant to check with us to determine that the consultant has
all the relevant facts. To our knowledge, there were no such consultations with other accountants.
MANAGEMENT REPRESENTATIONS
We have requested certain representations from management that are included in the management
representation letter. This letter follows this required communication.
INDEPENDENCE
We are not aware of any relationships between Baker Tilly Virchow Krause, LLP and the City that, in our
professional judgment, may reasonably be thought to bear on our independence.
Relating to our audit of the financial statements of for the year ended December 31, 2013, Baker Tilly Virchow
Krause, LLP hereby confirms that we are, in our professional judgment, independent with respect to the City in
accordance with the Code of Professional Conduct issued by the American Institute of Certified Public
Accountants. We provided no services to the City other than audit services provided in connection with the audit
of the current year's financial statements and nonaudit services which in our judgment do not impair our
independence.
> Financial statement preparation
> Compiled regulatory reports
> CIVIC System software
None of these nonaudit services constitute an audit under generally accepted auditing standards, including
Government Auditing Standards.
OTHER AUDIT FINDINGS OR ISSUES
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to retention as the City's auditors. However, these discussions
occurred in the normal course of our professional relationship and our responses were not a condition to our
retention.
OTHER MATTERS
With respect to the supplementary information accompanying the financial statements, we made certain
inquiries of management and evaluated the form, content, and methods of preparing the information to
determine that the information complies with accounting principles generally accepted in the United States of
America, the method of preparing it has not changed from the prior period, and the information is appropriate
and complete in relation to our audit of the financial statements. We compared and reconciled the
supplementary information to the underlying accounting records used to prepare the financial statements or to
the financial statements themselves.
Page 10
To the Honorable Mayor and the Common Council
City of Muskego
OTHER MATTERS (continue)
This information is intended solely for the use of the City, Common Council and management and is not
intended to be, and should not be, used by anyone other than these specified parties.
We welcome the opportunity to discuss the information included in this letter and any other matters. Thank you
for allowing us to serve you.
Milwaukee, Wisconsin
August 6, 2014
Page 11
MANAGEMENT REPRESENTATIONS
August 6, 2014
Baker Tilly Virchow Krause, LLP
777 E Wisconsin Ave, 32nd Floor
Milwaukee, WI 53202
Dear Baker Tilly Virchow Krause, LLP:
We are providing this letter in connection with your audit of the financial statements of the City of Muskego
as of December 31, 2013 and for the year then ended, the Big Muskego Lake -Bass P rotection and Rehabilitation
District as of December 31, 2013 and the year then ended, and for the City of Muskego Water Public Utility and City
of Muskego Sewer Utility as of December 31, 2013 and 2012 and for the years then ended for the purpose of
expressing an opinion as to whether the financial statements present fairly , in all material respects , the respect ive
financial position of the governmental activities, the business-type activities, each major fund , and the aggregate
remaining fund information of the City of Muskego and the Big Muskego Lake District and the respecti ve changes in
financial position and cash flows , where applicable, in conformity with accounting principles generally accepted in
the United States of America. We confirm that we are responsible for the fa ir presentation of t he previously
mentioned financial statements in conformity with accounting principles generally accepted in the U nited States of
America. We are also responsible for adopting sound accounting policies, establishing and maintaining internal
control over financial reporting , and preventing and detecting fraud .
Certain representations in this letter are described as being limited to matters that are material. Items are
considered material, regardless of size, if they involve an omission or misstatement of accounting information that,
in the light of surrounding circumstances, makes it probable that the judgment of a reasonab le person re lying on
the information would be changed or influenced by the omission or misstatement. An omission or misstatement t hat
is monetarily small in amount could be conside red material as a result of qualitati ve factors.
We confirm, to the best of our knowledge and belief, the following representa t ions made to you during your aud it.
Financial Statements
1 . We have fulfilled our responsibilities , as set out in the terms of the audit engagement lette r.
2. The financial statements referred to above are fairly presented in conformity with accounting principles generally
accepted in the United States of America and include all properly classified funds and other financia l information
of the oversight unit and all component units required by accounting principles generally accepted in the United
States of America to be included in the financial reporting entity .
3. We acknowledge our responsibility for the design, implementation , and ma intenance of internal contro l re levant
to the preparation and fair presentation of financial statements that are free from materia l misstatement, whethe r
due to fraud or error.
4. We acknowledge our responsibility for the design, implementation, and maintena nce of internal control to prev ent
and detect fraud .
5. Significant assumptions we us ed in making accounting estimates are reaso nable .
6. All events subsequent to the date of the financial statements and for which accounting principles generally
accepted in the United States of America require adjustment or disclosure have been adjusted or disclosed. No
other events, including instances of noncompliance, have occurred subsequent to the balance sheet date and
through the date of this letter that would require adjustment to or disclosure in the aforementioned financial
statements.
7. All material transactions have been recorded in the accounting records and are reflected in the financial
statements.
8. There are no known or possible litigation, claims, and assessments whose effects should be considered when
preparing the financial statements. There are no unasserted claims or assessments that our lawyer has advised
us are probable of assertion and must be disclosed in accordance with accounting principles generally accepted
in the United States of America.
9. Guarantees, whether written or oral, under which the City is contingently liable, if any, have been properly
recorded or disclosed.
Information Provided
10. We have provided you with:
a. Access to all information, of which we are aware, that is relevant to the preparation and fair presentation of
the financial statements, such as financial records and related data , documentation, and other matters.
b. Additional information that you have requested from us for the purpose of the audit.
c. Unrestricted access to persons within the entity from whom you determined it necessary to obtain audit
evidence.
d. Minutes of the meetings of Common Council and Public Utilities Committee or summaries of actions of recent
meetings for which minutes have not yet been prepared.
11. We have disclosed to you the results of our assessment of the risk that the financial statements may be
materially misstated as a result of fraud.
12. We have no knowledge of any fraud or suspected fraud that affects the entity and involves:
a. Management,
b. Employees who have significant roles in internal control, or
c. Others where the fraud could have a material effect on the financial statements.
13. We have no knowledge of any allegations of fraud or suspected fraud affecting the entity received in
communications from employees, former employees, regulators, or others.
14. We have no knowledge of known instances of noncompliance or suspected noncompliance with provisions of
laws, regulations, contracts, or grant agreements, or abuse, whose effects should be considered when
preparing financial statements.
15. There are no known related parties or related party relationships and transactions of which we are aware.
Other
16. There have been no communications from regulatory agencies concerning noncompliance with, or deficiencies
in, financial reporting practices.
17. We have a process to track the status of audit findings and recommendations.
18. We have identified to you any previous financial audits, attestation engagements, and other studies related to
the audit objectives and whether related recommendations have been implemented.
19. The City has no plans or intentions that may materially affect the carrying value or classification of assets,
liabilities, or equity.
20. We are responsible for compliance with federal, state, and local laws, regulations, and provisions of contracts
and grant agreements applicable to us, including tax or debt limits and debt contracts; and we have identified
and disclosed to you all federal, state, and local laws, regulations and provisions of contracts and grant
agreements that we believe have a direct and material effect on the determination of financial statement
amounts or other financial data significant to the audit objectives, including legal and contractual provisions for
reporting specific activities in separate funds.
21. There are no:
a. Violations or possible violations of budget ordinances, federal, state, and local laws or regulations (including
those pertaining to adopting and amending budgets) except that we have not adopted a budget for the Tax
Increment District Capital Project Fund, the Federated Library System Fund, and the Industrial Park
Expansion Fund as required by State Statute, provisions of contracts and grant agreements, tax or debt limits,
and any related debt covenants whose effects should be considered for disclosure in the financial statements
or as a basis for recording a loss contingency, or for reporting on noncompliance.
b. Other liabilities or gain or loss contingencies that are required to be accrued or disclosed by accounting
principles generally accepted in the United States of America.
c. Nonspendable, restricted, committed, or assigned fund balances that were not properly authorized and
approved.
d. Rates being charged to customers other than the rates as authorized by the applicable authoritative body.
e. Violations of restrictions placed on revenues as a result of bond resolution covenants such as revenue
distribution or debt service funding.
22. In regards to the nonattest services performed by you listed below, we have 1) made all management decisions
and performed all management functions; 2) designated an individual with suitable skill, knowledge, or
experience to oversee the services; 3) evaluated the adequacy and results of the services performed, and 4)
accepted responsibility for the results of the services.
a. Financial statement preparation
b. Compiled regulatory reports
c. Civic Systems software
None of these non attest services constitute an audit under generally accepted auditing standards, including
Government Auditing Standards.
23. The City of Muskego has satisfactory title to all owned assets, and there are no liens or encumbrances on such
assets nor has any asset been pledged as collateral.
24. The City of Muskego has complied with all aspects of contractual agreements that would have a material effect
on the financial statement in the event of noncompliance.
25. We have followed all applicable laws and regulations in adopting, approving, and amending budgets.
26. The financial statements appropriately do not include component units, joint ventures with an equity interest, or
other joint ventures and other related organizations.
27. The financial statements properly classify all funds and activities.
28. All funds that meet the quantitative criteria in GASB Statement No. 34 and No. 37 for presentation as major are
identified and presented as such and all other funds that are presented as major are particularly important to
financial statement users.
29. Components of net position (net investment in capital assets; restricted; and unrestricted) and equity amounts
are properly classified and, if applicable, approved.
30. The City of Muskego has no derivative financial instruments such as contracts that could be assigned to
someone else or net settled, interest rate swaps, collars or caps.
31. Provisions for uncollectible receivables have been properly identified and recorded.
32. Expenses have been appropriately classified in or allocated to functions and programs in the statement of
activities, and allocations have been made on a reasonable basis.
33. Revenues are appropriately classified in the statement of activities within program revenues and general
revenues.
34. lnterfund, internal, and intra-entity activity and balances have been appropriately classified and reported.
35. Deposits and investment securities are properly classified as to risk, and investments are properly valued.
Collateralization agreements with financial institutions, if any, have been properly disclosed.
36. Capital assets, including infrastructure and intangible assets, are properly capitalized, reported, and, if
applicable, depreciated/amortized. Any known impairments have been recorded and disclosed.
37. Tax-exempt bonds issued have retained their tax-exempt status ..
38. The operations and rate setting process meet the condition for application of accounting for regulated
operations as outlined in GASB No. 62. All regulatory items included in the financial statements have been
approved and are being accounted for in accordance with specific action taken by the regulatory body and as
such the expectation of future recovery or refund is reasonable.
39. We have appropriately disclosed the City of Muskego's policy regarding whether to first apply restricted or
unrestricted resources when an expense is incurred for purposes for which both restricted and unrestricted net
position are available and have determined that net position were properly recognized under the policy. We
have also disclosed our policy regarding how restricted and unrestricted fund balance is used when an
expenditure is incurred for which both restricted and unrestricted fund balance is available, including the
spending hierarchy for committed, assigned, and unassigned amounts.
40. We acknowledge our responsibility for the required supplementary information (RSI). The RSI is measured and
presented within prescribed guidelines and the methods of measurement and presentation have not changed
from those used in the prior period. We have disclosed to you any significant assumptions and interpretations
underlying the measurement and presentation of the RSI.
41. With respect to the supplementary information, (SI):
a. We acknowledge our responsibility for presenting the SI in accordance with accounting principles generally
accepted in the United States of America, and we believe the SI, including its form and content, is fairly
presented in accordance with accounting principles generally accepted in the United States of America. The
methods of measurement and presentation of the SI have not changed from those used in the prior period,
and we have disclosed to you any significant assumptions or interpretations underlying the measurement and
presentation of the supplementary information.
b . If the SI is not presented with the audited financial statements, we w ill make the aud ited financial statements
readily available to the intended users of the supplementary information no later than the date we issue the
supplementary information and the auditor's report thereon .
42. We agree with the restatement presented in the current year's financia l statements.
43. We have implemented GASB Statement No. 65 and believe that all deferred outflows and deferred inflows have
been identified and properly classified in the financial statements and any other required classifications have
been computed in compliance with the Standard.
Sincerely,
City of Muskego
Signed :
Sharon Mueller, Finance and Administration Director
Signed :
Council Date AUG. 12, 2014
Total Vouchers All Funds $454,440.13
Total Voucher Approval
Utility Vouchers (Approve Separately)
Water Vouchers $18,405.59
Water Wire Transfers
Total Water $18,405.59
Sewer Vouchers 61,730.57
Sewer Wire Transfers
Total Sewer $61,730.57
Net Total Utility Vouchers $ 80,136.16
#1 - Utility Voucher Approval
Tax Vouchers - Refunds & Tax Settlements (Approve Separately)
Tax Vouchers $692.14
Tax Void Checks ()**
Total Tax Vouchers $ 692.14
#2 - Tax Voucher Approval
Total General Fund Vouchers (Approve Separately)
General Fund Vouchers $373,611.83
General Fund Void Checks ()**
Total General Fund Vouchers $ 373,611.83
#3 - General Voucher Approval
Big Muskego Lake Vouchers $
.
Wire transfers (Approve Separately):
Tax Settlements $
Debt Service $
Payroll Transmittals $377,986.16
#4 - Wire Transfers Approval
Void Checks Since Last Report
Check #Amount Check #Amount
137424 508.77
Total ***
Total 508.77 *Total ***
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 1
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Report Criteria:
Detail report.
Invoices with totals above $0 included.
Paid and unpaid invoices included.
[Report].Description = {<>} "1099 adjustment"
Invoice Detail.Type = {>} "adjustments"
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
A & W GREENHOUSE
AW81214 1 Invoice FLOWERS/JANESVILLE RD PLANT 07/16/2014 08/12/2014 200.00 814 401.08.91.19.6518
Total A & W GREENHOUSE:200.00
ADAMSON, JACOB
14064 1 Invoice CAMP ASST 08/05/2014 08/12/2014 250.00 814 100.05.72.13.5110
Total ADAMSON, JACOB:250.00
ALL ABOUT GRAPHICS PLUS LLC
AAGP-1628 1 Invoice SHIRTS & BANNERS/NNO 07/14/2014 08/07/2014 2,843.00 814 505.00.00.00.2638
Total ALL ABOUT GRAPHICS PLUS LLC:2,843.00
ALL-STAR SPORTSWEAR INC
37386 1 Invoice VOGEL TENNIS CAMP SHIRTS 07/22/2014 08/12/2014 155.00 814 100.05.72.13.5702
Total ALL-STAR SPORTSWEAR INC:155.00
ANCHOR PRINTING, INC.
12664 1 Invoice VOTING ENV/INNER & OUTER 08/02/2014 08/12/2014 1,513.00 814 100.01.03.00.5704
Total ANCHOR PRINTING, INC.:1,513.00
ANDERSON, JONATHAN & SOFIJA
JO81214 1 Invoice MAILBOX/2237.009 08/07/2014 08/12/2014 50.00 814 100.04.51.05.5704
Total ANDERSON, JONATHAN & SOFIJA:50.00
APPLIED ASSC
96438657 1 Invoice PARTS 07/15/2014 08/12/2014 598.07 814 100.04.51.07.5405
Total APPLIED ASSC:598.07
ARENZ, MOLTER, MACY AND RIFFLE
10069 2 Invoice BELLE CHASE/DD#800 07/22/2014 08/12/2014 583.75 814 507.00.00.00.2708
10069 3 Invoice INGOLD/DD#824 07/22/2014 08/12/2014 26.00 814 507.00.00.00.2684
10069 4 Invoice MERCURY DR/ELEVATED TANK 07/22/2014 08/12/2014 229.50 814 605.00.00.00.1977
10069 5 Invoice CIRCLE DR 07/22/2014 08/12/2014 58.00 814 216.08.00.00.6503
10069 6 Invoice MISC WTR,BOND & INS 07/22/2014 08/12/2014 372.75 814 605.00.00.00.1977
10069 7 Invoice TUDOR OAKS/DD#673 07/22/2014 08/12/2014 65.50 814 507.00.00.00.2698
10069 8 Invoice 2014 ROAD PROG 07/22/2014 08/12/2014 351.50 814 100.07.51.02.6502
10069 9 Invoice MISC GEN GOV 07/22/2014 08/12/2014 1,387.25 814 100.01.05.00.5805
10069 10 Invoice MOORLAND RD 07/22/2014 08/12/2014 110.00 814 100.04.19.00.5815
10069 11 Invoice OARKLAND MALL 07/22/2014 08/12/2014 771.75 814 100.01.05.00.5805
10069 12 Invoice TUDOR OAKS/DD#673 07/22/2014 08/12/2014 544.25 814 507.00.00.00.2698
10069 1 Invoice TRAFFIC 07/22/2014 08/12/2014 4,270.00 814 100.01.08.00.6003
Total ARENZ, MOLTER, MACY AND RIFFLE:8,770.25
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 2
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
ASSOCIATED BAG COMPANY
N330095 1 Invoice CAN LINERS 06/26/2014 08/13/2014 366.27 814 100.05.72.02.5702
Total ASSOCIATED BAG COMPANY:366.27
ASSOCIATED BANK
AS81214 1 Invoice 8/1 REV BOND/INT 08/01/2014 08/12/2014 6,526.25 814 601.00.00.00.1011
AS81214 2 Invoice 8/1 REV BOND/PRIN 08/01/2014 08/12/2014 25,416.67 814 601.00.00.00.1011
Total ASSOCIATED BANK:31,942.92
ASSURANT EMPLOYEE BENEFITS
5469400/81214 1 Invoice DENTAL/AUG 07/17/2014 08/12/2014 3,119.29 814 100.00.00.00.2211
5469400/81214 2 Invoice VISION/AUG 07/17/2014 08/12/2014 433.63 814 100.00.00.00.2212
60169/081214 1 Invoice ACCIDENT/JULY 07/22/2014 08/12/2014 253.35 814 100.00.00.00.2247
60169/081214 2 Invoice CRITICAL ILL/JULY 07/22/2014 08/12/2014 152.25 814 100.00.00.00.2248
60169/081214 3 Invoice LTD/JULY 07/22/2014 08/12/2014 266.08 814 100.00.00.00.2246
60169/081214 4 Invoice STD/JULY 07/22/2014 08/12/2014 494.59 814 100.00.00.00.2243
Total ASSURANT EMPLOYEE BENEFITS:4,719.19
BUBRICKS INC
940888 1 Invoice 2 TONER CART/DOFA 08/01/2014 08/12/2014 94.00 814 100.01.03.00.5701
941939 1 Invoice 5 BOXES PAYROLL ENV 08/04/2014 08/12/2014 99.95 814 100.01.06.00.5701
Total BUBRICKS INC:193.95
BUMPER TO BUMPER MUSKEGO
435501 1 Invoice OIL & WIPE HOSE 07/22/2014 08/12/2014 62.96 814 100.05.72.02.5702
435601 1 Invoice RETURNED HOSE WHIP 07/23/2014 08/12/2014 14.99-814 100.05.72.02.5405
435602 1 Invoice SM PORTABLE AIR TANK 07/23/2014 08/12/2014 30.49 814 100.05.72.02.5405
435605 1 Invoice FLASHER LIGHTS FOR TRI-DECK 07/23/2014 08/12/2014 5.62 814 100.05.72.02.5405
Total BUMPER TO BUMPER MUSKEGO:84.08
BURMEISTER,GREG
BU81214 1 Invoice MEETING ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total BURMEISTER,GREG:61.25
BUSINESS GRAPHICS&PRINTING IN
978586 1 Invoice IDLE ISLE RECEIPT BOOKS 05/31/2014 08/12/2014 500.00 814 100.05.72.02.5702
Total BUSINESS GRAPHICS&PRINTING IN:500.00
CDW GOVERNMENT, INC
MX41149 1 Invoice SCANNER STAND 08/08/2014 08/12/2014 51.65 814 100.07.01.06.6502
MX49354 1 Invoice SCANNER STAND 08/08/2014 08/12/2014 103.30 814 100.07.01.06.6502
MZ34451 1 Invoice AC ADAPTER 08/08/2014 08/12/2014 44.53 814 100.07.01.06.6502
Total CDW GOVERNMENT, INC:199.48
CHAPPELL SPORTS
14018 1 Invoice CAMP SHIRTS 07/31/2014 08/12/2014 525.00 814 100.05.72.13.5702
Total CHAPPELL SPORTS:525.00
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 3
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
CORBETT, SEAN
13957-59 1 Invoice KARATE INSTRUCTION & GIS 07/28/2014 08/12/2014 1,428.00 814 100.05.72.13.5110
Total CORBETT, SEAN:1,428.00
COWLING, MICHAEL
C081214 1 Invoice MEMBER ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total COWLING, MICHAEL:61.25
CULLIGAN OF WAUK INC
73114 1 Invoice FILTER SERV JRC 08/12/2014 08/12/2014 39.16 814 100.05.72.02.5410
Total CULLIGAN OF WAUK INC:39.16
CURLEY, JEAN
203 1 Invoice CLASSES/SP MEDIA & WATERCO 07/16/2014 08/12/2014 950.00 814 100.05.72.12.5110
Total CURLEY, JEAN:950.00
CVIKEL, ANGELA
CV81214 1 Invoice 2014 REIMB UNIFORM SHOES 07/17/2014 08/12/2014 36.95 814 100.02.20.10.5151
Total CVIKEL, ANGELA:36.95
DEPT OF SAFETY & PROF SRV
352230 1 Invoice ELEVATOR PERMIT 07/17/2014 08/12/2014 50.00 814 100.02.20.01.5415
352287 1 Invoice ELVATOR PERMIT 07/17/2014 08/12/2014 50.00 814 100.01.09.00.5415
Total DEPT OF SAFETY & PROF SRV:100.00
DIVERSIFIED BENEFIT SERV INC.
186332 1 Invoice FSA FEES/JULY 07/17/2014 08/12/2014 215.97 814 100.01.06.00.5203
187048 1 Invoice HRA FEES/AUG 08/04/2014 08/12/2014 385.81 814 100.01.06.00.5203
Total DIVERSIFIED BENEFIT SERV INC.:601.78
EAGLE MEDIA, INC.
28721 1 Invoice UNIFORM ITEM/MUELLER 07/17/2014 08/12/2014 171.92 814 100.02.20.10.5151
28721 2 Invoice UNIFORM ITEM/CVIKEL 07/17/2014 08/12/2014 134.44 814 100.02.20.10.5151
28854 1 Invoice ELECTION SIGNS 08/06/2014 08/12/2014 273.90 814 100.01.03.00.5704
Total EAGLE MEDIA, INC.:580.26
EDWARDS, WILLIAM
ED81214 1 Invoice SUMMER PROGRAM ADS 08/04/2014 08/12/2014 294.92 814 100.05.72.10.5820
Total EDWARDS, WILLIAM:294.92
EH WOLF & SONS INC
EH81214 1 Invoice SHO/UTILITY PLEX 07/17/2014 08/12/2014 368.88 814 100.04.51.07.5405
Total EH WOLF & SONS INC:368.88
ELLIOTS ACE HARDWARE
EI81214 1 Invoice 1/2 " CONNECTOR 07/17/2014 08/12/2014 1.69 814 601.61.61.15.5415
EI81214 2 Invoice WEED LINE 07/17/2014 08/12/2014 13.99 814 601.61.61.15.5415
EL81214 1 Invoice WELL #10 08/06/2014 08/12/2014 16.38 814 605.54.06.41.5702
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 4
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
EL81214 2 Invoice WEED PREVENTER 08/06/2014 08/12/2014 49.98 814 605.54.06.41.5702
EL81214 3 Invoice HANDLE 08/06/2014 08/12/2014 23.98 814 601.61.61.12.5702
EL81214 4 Invoice TOOLS 08/06/2014 08/12/2014 18.98 814 601.61.61.12.5702
Total ELLIOTS ACE HARDWARE:125.00
ELLIOTT'S ACE HARDWARE
601005/81214 1 Invoice MAINT/CH 08/05/2014 08/12/2014 50.71 814 100.01.09.00.5415
601005/81214 2 Invoice MAINT SUPPLIES/LIB 08/05/2014 08/12/2014 42.18 814 100.05.71.00.5415
601005/81214 3 Invoice MAINT/PD 08/05/2014 08/12/2014 27.58 814 100.02.20.01.5415
896552 1 Invoice RACHET/SOAP/BULB 07/01/2014 08/12/2014 60.72 814 100.05.72.02.5702
896679 1 Invoice PAINT/FASTENERS/ROPE 07/08/2014 08/12/2014 32.91 814 100.05.72.02.5702
896843 1 Invoice SUPPLIES 07/16/2014 08/12/2014 18.24 814 215.06.00.00.5704
897104 1 Invoice LOCKNUTS/AWL/LATCH 07/29/2014 08/12/2014 39.05 814 100.05.72.02.5702
Total ELLIOTT'S ACE HARDWARE:271.39
ENERGENECS INC.
0028677-IN 1 Invoice SENSOR 07/17/2014 08/12/2014 1,480.54 814 601.61.61.16.5411
Total ENERGENECS INC.:1,480.54
EZ-LINER IND.
55950 1 Invoice PARTS/STRIPPER 07/15/2014 08/12/2014 2,247.27 814 100.04.51.07.5405
Total EZ-LINER IND.:2,247.27
F & W LANDSCAPE SPECIALISTS
2859 1 Invoice GRASS CUTTING 2212.112 08/08/2014 08/12/2014 90.00 814 100.00.00.00.1304
2859 2 Invoice GRASS CUTTING 2174.151 08/08/2014 08/12/2014 75.00 814 100.00.00.00.1304
2859 3 Invoice GRASS CUTTING 2218.043 08/08/2014 08/12/2014 125.00 814 100.00.00.00.1304
2859 4 Invoice GRASS CUTTING - 2198.984 08/08/2014 08/12/2014 1,600.00 814 100.00.00.00.1304
Total F & W LANDSCAPE SPECIALISTS:1,890.00
FASTENAL COMPANY
WIMUK51102 1 Invoice SHOP SUPPLIES 07/16/2014 08/12/2014 59.89 814 100.04.51.07.5405
Total FASTENAL COMPANY:59.89
FIRTH, ANDREW A
FI81214 1 Invoice WITNESS FEE/#DL80NMQKRD 07/24/2014 08/12/2014 7.20 814 100.01.08.00.6004
Total FIRTH, ANDREW A:7.20
FOTH INFRASTRUCTURE &
39820 1 Invoice TUDOR OAKS WTR MAIN & STOR 07/14/2014 08/12/2014 3,159.40 814 507.00.00.00.2698
39821 1 Invoice IN-PRO OFFICE DEVELOPMENT 07/14/2014 08/12/2014 3,776.30 814 507.00.00.00.2642
Total FOTH INFRASTRUCTURE &:6,935.70
FRANKLIN AGGREGATES, INC.
1286958 1 Invoice 1-1/4" CABC 07/24/2014 08/12/2014 51.31 814 100.05.72.02.5415
1286959 1 Invoice 1-1/4" CABC 07/24/2014 08/12/2014 434.18 814 100.04.51.02.5741
Total FRANKLIN AGGREGATES, INC.:485.49
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 5
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
GAIL FORCE ENTERPRISES
5161 1 Invoice JULY/THURSDAY YOGA 07/31/2014 08/12/2014 160.00 814 100.05.72.13.5110
Total GAIL FORCE ENTERPRISES:160.00
GAMETIME
14792 1 Invoice REPLACE PLGRD SEATS & BELTS 07/10/2014 08/12/2014 628.70 814 100.05.72.02.5415
Total GAMETIME:628.70
GENERAL CODE
BILL00014795 1 Invoice RECODIFICATION PROJECT/#1 07/16/2014 08/12/2014 3,580.00 814 410.08.90.01.6502
Total GENERAL CODE:3,580.00
GIGGLY HUGS CHILD CARE INC
GI81214 1 Invoice JUNE MUSIC MAKERS 07/19/2014 08/12/2014 432.00 814 100.05.72.18.5110
Total GIGGLY HUGS CHILD CARE INC:432.00
GLEASON REDI MIX
219706 1 Invoice REDI MIX 07/09/2014 08/12/2014 86.50 814 100.04.51.04.5744
Total GLEASON REDI MIX:86.50
GRAEF INC
0081414 1 Invoice JANESVILLE ROAD STREETSCAP 08/08/2014 08/12/2014 1,110.00 814 401.08.91.19.6518
Total GRAEF INC:1,110.00
GREENDALE POLICE DEPARTMENT
GR81214 1 Invoice BOND MARCELLA SAWEJKA-REE 08/04/2014 08/12/2014 108.80 814 100.01.08.00.4269
Total GREENDALE POLICE DEPARTMENT:108.80
GREENFIELD POLICE DEPT.
GR81214 1 Invoice BOND/ESTEVAN CERVERA 07/24/2014 08/12/2014 121.60 814 100.01.08.00.4269
Total GREENFIELD POLICE DEPT.:121.60
GRIMME, RICHARD
GR81214 1 Invoice COMMERCIAL GRANT/LITTLE MU 07/23/2014 08/12/2014 1,317.50 814 220.01.00.00.5704
Total GRIMME, RICHARD:1,317.50
HALES CORNERS POLICE DEPT.
HA81214 1 Invoice BOND CHRISTOPHER TUCHALSKI 07/30/2014 08/12/2014 404.40 814 100.01.08.00.4269
Total HALES CORNERS POLICE DEPT.:404.40
HAYES, RICHARD
14064 1 Invoice CAMP ASST 08/05/2014 08/12/2014 400.00 814 100.05.72.13.5110
Total HAYES, RICHARD:400.00
HD SUPPLY WATERWORKS, LTD
C684008 1 Invoice PVC PARTS 07/17/2014 08/12/2014 995.80 814 100.04.51.04.5744
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 6
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Total HD SUPPLY WATERWORKS, LTD:995.80
HENNEBERRY, BRIAN
HE81214 1 Invoice 2014 REIMB/BOOTS 07/19/2014 08/12/2014 131.99 814 100.04.51.01.5225
Total HENNEBERRY, BRIAN:131.99
HESS, ERIC
14014 1 Invoice CAMP DIRECTOR 08/05/2014 08/12/2014 1,253.00 814 100.05.72.13.5110
Total HESS, ERIC:1,253.00
HILLER FORD INC
46438 1 Invoice 2014 TRUCK & RESISTRATION 07/18/2014 07/24/2014 11,210.25 714 605.00.00.00.1962
46438 2 Invoice 2014 TRUCK & RESISTRATION 07/18/2014 07/24/2014 11,210.25 714 601.00.00.00.1922
Total HILLER FORD INC:22,420.50
HIPPENMEYER,REILLY,MOODIE & BLUM SC
38975 1 Invoice SPECIAL PROSECUTION 07/15/2014 08/12/2014 218.75 814 100.01.05.00.5805
Total HIPPENMEYER,REILLY,MOODIE & BLUM SC:218.75
HIRTZ, BRIAN
14018 1 Invoice CAMP DIRECTOR 07/31/2014 08/12/2014 3,275.00 814 100.05.72.13.5110
Total HIRTZ, BRIAN:3,275.00
INLAND LEASING
58804609 1 Invoice CONTRACT PAYMENT/JULY 07/23/2014 08/12/2014 116.82 814 100.01.06.00.5702
58806620 1 Invoice CONTRACT PAYMENT/AUGUST 07/23/2014 08/12/2014 116.82 814 100.01.06.00.5702
Total INLAND LEASING:233.64
INTECTURAL, INC
3881214 1 Invoice 4'X12' SKATELITE 07/15/2014 07/22/2014 484.77 814 100.05.72.02.5415
Total INTECTURAL, INC:484.77
INTOXIMETERS, INC.
471997 1 Invoice PBT STRAWS 07/17/2014 08/12/2014 172.00 814 100.02.20.01.5722
Total INTOXIMETERS, INC.:172.00
ITU ABSORB TECH, INC
5876411 1 Invoice SHOP TOWELS & RAGS 07/24/2014 08/12/2014 54.73 814 100.05.72.02.5410
Total ITU ABSORB TECH, INC:54.73
JAMES IMAGING SYSTEMS INC
550238 1 Invoice COPIES 1/3 MO CHG 07/14/2014 07/22/2014 10.07 814 100.04.51.01.5701
550238 2 Invoice COPIES 1/3 MO CHG 07/14/2014 07/22/2014 10.06 814 601.61.63.42.5701
550238 3 Invoice COPIES 1/3 MO CHG 07/14/2014 07/22/2014 10.06 814 605.56.09.21.5401
Total JAMES IMAGING SYSTEMS INC:30.19
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 7
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
JANI-KING INC- MILW REGION
8140539 1 Invoice AUGUST PARK FACILITIES CLEAN 08/01/2014 08/12/2014 535.40 814 100.05.72.02.5820
MIL08140174 1 Invoice CLEANING/CH AUGUST 07/25/2014 08/12/2014 2,150.00 814 100.01.09.00.5835
MIL08140174 2 Invoice CLEANING/PD AUGUST 07/25/2014 08/12/2014 1,728.00 814 100.02.20.01.5835
MIL08140174 3 Invoice CLEANING/LIB AUGUST 07/25/2014 08/12/2014 3,049.00 814 100.05.71.00.5835
MIL08140174 4 Invoice CLEANING/TOWN HALL AUGUS 07/25/2014 08/12/2014 363.00 814 100.05.72.03.5820
MIL08140174 5 Invoice CLEANING/PK ARTHUR AUGUS 07/25/2014 08/12/2014 480.00 814 100.05.72.02.5820
Total JANI-KING INC- MILW REGION:8,305.40
JM BRENNAN, INC.
57507 1 Invoice A/C REPAIR 07/16/2014 08/12/2014 2,746.87 814 100.02.20.01.5415
57640 1 Invoice A/C REPAIR 07/18/2014 08/12/2014 1,189.53 814 100.02.20.01.5415
Total JM BRENNAN, INC.:3,936.40
JOHANNIK, STEVE
JO81214 1 Invoice REIMB/MEALS,TRAINING 07/14/2014 08/12/2014 35.69 814 100.02.20.01.5301
Total JOHANNIK, STEVE:35.69
JOHNNY'S PETROLEUM PROD INC
32826 1 Invoice TIRE REPAIR/#7 08/02/2014 08/12/2014 20.00 814 100.02.20.01.5405
Total JOHNNY'S PETROLEUM PROD INC:20.00
JOURNAL SENTINEL INC
7000556-7-14 1 Invoice MISC PUBL 08/06/2014 08/12/2014 151.71 814 100.01.06.00.6001
7000556-7-14 2 Invoice ELECTIONS/MAR 08/06/2014 08/12/2014 81.30 814 100.01.03.00.5704
7000556-7-14 3 Invoice PK ARTHUR 08/06/2014 08/12/2014 37.10 814 202.08.94.74.6530
Total JOURNAL SENTINEL INC:270.11
JSA CIVIL ENV ENGINEERS
2514 1 Invoice VEOLIA OVERSIGHT & AUDIT 08/05/2014 08/12/2014 5,415.29 814 210.03.00.00.5816
Total JSA CIVIL ENV ENGINEERS:5,415.29
KIEFFER, ROLAND
KI81214 1 Invoice MEETING ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total KIEFFER, ROLAND:61.25
KLOSKOWSKI, SCOTT
KL81214 1 Invoice 2014 REIMB SHOES 07/17/2014 08/12/2014 11.08 814 601.61.61.12.5702
KL81214 2 Invoice 2014 REIMB SHOES 07/17/2014 08/12/2014 11.09 814 605.56.09.30.5228
Total KLOSKOWSKI, SCOTT:22.17
KNIGHT BARRY TITLE INC
2165973 1 Invoice TAX REFUND/#130 08/04/2014 08/12/2014 692.14 814 501.00.00.00.2120
Total KNIGHT BARRY TITLE INC:692.14
KUEHL, KATIE
74132 1 Invoice GAP REFUND 07/21/2014 08/12/2014 572.00 814 100.00.00.00.2110
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 8
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Total KUEHL, KATIE:572.00
LAKELAND SUPPLY, INC.
42430 1 Invoice PAPER & TISSUE SUPPLIES 07/16/2014 08/12/2014 390.94 814 100.02.20.01.5415
Total LAKELAND SUPPLY, INC.:390.94
LAMERS BUS LINES INC.
452704 1 Invoice PARTIAL SUMMER FIELD TRIPS 07/22/2014 08/12/2014 737.10 814 100.05.72.16.5820
453393 1 Invoice 2 BUSES/RIDGE THEATER 08/04/2014 08/12/2014 270.96 814 100.05.72.16.5820
Total LAMERS BUS LINES INC.:1,008.06
MACIOSEK, SMANTHA
MA81214 1 Invoice COURT ORDERED RESTITUTION#07/22/2014 08/12/2014 100.00 814 100.01.08.00.4269
Total MACIOSEK, SMANTHA:100.00
MADISON AREA TECH COLLEGE
36698 1 Invoice FIREARMS TRAINING/JONES 07/22/2014 08/12/2014 199.00 814 100.02.20.01.5301
Total MADISON AREA TECH COLLEGE:199.00
MALACHEK, JAMES
MA81214 1 Invoice SPEED STRENGHT PROG ASST 07/22/2014 08/12/2014 1,200.00 814 100.05.72.13.5110
Total MALACHEK, JAMES:1,200.00
MANTEK
1566988 1 Invoice AEROSAL 07/08/2014 08/12/2014 107.51 814 100.04.51.07.5405
1599064 1 Invoice 100#S MANZYME 08/05/2014 08/12/2014 1,433.41 814 601.61.61.12.5750
Total MANTEK:1,540.92
MATEICKA, SR. DON
MA81214 1 Invoice MEETING ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total MATEICKA, SR. DON:61.25
MAVROFF, INC
57757 1 Invoice PLAYGROUND CHIPS 07/23/2014 08/12/2014 1,050.00 814 202.08.94.74.6584
Total MAVROFF, INC:1,050.00
MENARDS
49204 1 Invoice DUMPSTER MATL/BLUHM OARK 06/11/2014 08/12/2014 102.60 814 100.05.72.02.5415
52024 1 Invoice PRIVACY BALBOA/SHOP 07/16/2014 08/12/2014 41.84 814 100.05.72.02.5415
52024 2 Invoice SCREWS/BRACE/BLUHM 07/16/2014 08/12/2014 9.95 814 100.05.72.02.5415
52024 3 Invoice LUMBER/HISTORICAL SIGNS 07/16/2014 08/12/2014 41.94 814 100.05.72.02.5415
Total MENARDS:196.33
MHS SOCCER BOOSTR CLUB INC
14014 1 Invoice SOCCER CAMPS 08/05/2014 08/12/2014 1,323.00 814 100.05.72.13.5110
Total MHS SOCCER BOOSTR CLUB INC:1,323.00
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 9
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
MICHLIG, JAMES
MI81214 1 Invoice SPEED STRENGTH PROG ASST 06/17/2014 08/12/2014 1,000.00 814 100.05.72.13.5110
Total MICHLIG, JAMES:1,000.00
MILLER, KATHI
75514 1 Invoice CLUTTER FREE FOR HOME/OFFI 07/22/2014 08/12/2014 72.00 814 100.05.72.18.5110
Total MILLER, KATHI:72.00
MILW KICKERS SOCCER CLUB INC
13982-83 1 Invoice SUMMER MICRO SOCCER 07/22/2014 08/12/2014 3,790.00 814 100.05.72.13.5110
Total MILW KICKERS SOCCER CLUB INC:3,790.00
MILW METALS
1543 1 Invoice METRIC GRADE/END WALLS 06/26/2014 08/12/2014 331.25 814 100.04.51.04.5744
Total MILW METALS:331.25
MILWAUKEE LAWN SPRINKLER
50574 1 Invoice REPAIR 2 DRIP LEAKS - JNSVL RD 08/08/2014 08/12/2014 81.68 814 100.01.06.00.5820
Total MILWAUKEE LAWN SPRINKLER:81.68
MINNESOTA LIFE INS.
2832L-G/81214 1 Invoice LIFE INS PREM/SEPT 08/04/2014 08/12/2014 3,069.58 814 100.00.00.00.2207
Total MINNESOTA LIFE INS.:3,069.58
MLACHNIK, DANIEL
14018 1 Invoice CAMP ASST 07/31/2014 08/12/2014 200.00 814 100.05.72.13.5110
Total MLACHNIK, DANIEL:200.00
MOTOROLA, INC.
13020304 1 Invoice RADIOS - PARTIAL PAYMENT 08/07/2014 08/12/2014 8,300.00 814 410.08.91.20.6507
13021099 1 Invoice RADIOS - PARTIAL PAYMENT 08/07/2014 08/12/2014 6,410.64 814 410.08.91.20.6507
13021100 1 Invoice RADIOS - PARTIAL PAYMENT 08/08/2014 08/12/2014 78,208.75 814 410.08.91.20.6507
Total MOTOROLA, INC.:92,919.39
MTAW
MT81214 1 Invoice 2014 MTAW DUES/JENNY 07/22/2014 08/12/2014 25.00 814 100.01.03.00.5305
Total MTAW:25.00
MURRAY, PAT
MU81214 1 Invoice MEETING ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total MURRAY, PAT:61.25
MUSKEGO HIGH SCHOOL
14064 1 Invoice TENNIS CAMP 08/05/2014 08/12/2014 945.00 814 100.05.72.13.5110
Total MUSKEGO HIGH SCHOOL:945.00
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 10
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
MUSKEGO HISTORICAL SOCIETY
MU81214 1 Invoice HISTORIC MUSKEGO CENTRE PA 07/31/2014 08/12/2014 129.71 814 100.05.72.02.5415
Total MUSKEGO HISTORICAL SOCIETY:129.71
MUSKEGO PARKS & REC. DEPT.
MU81214 3 Invoice COUNTY PARK PARKING 07/11/2014 08/12/2014 28.00 814 100.05.72.02.5820
MU81214 4 Invoice COUNTY PARK PARKING 07/11/2014 08/12/2014 56.00 814 100.05.72.02.5820
MU81214 5 Invoice ICE 07/11/2014 08/12/2014 5.97 814 100.05.72.16.5702
MU81214 1 Invoice GAP FRISBEES/DISCS 07/11/2014 08/12/2014 31.45 814 100.05.72.16.5702
MU81214 2 Invoice PRE-SCHOOL THEMED CAMPS 07/11/2014 08/12/2014 23.11 814 100.05.72.16.5702
Total MUSKEGO PARKS & REC. DEPT.:144.53
MUSKEGO WOMAN'S CLUB
MU81214 1 Invoice SAFETY CITY PROGRAM 08/04/2014 08/12/2014 2,280.00 814 100.05.72.14.5820
Total MUSKEGO WOMAN'S CLUB:2,280.00
MUSSON BROS INC
MU81214 1 Invoice TESS CORNERS DR RECONST/FI 07/03/2014 08/12/2014 27,769.09 814 401.08.91.19.6507
MU81214A 1 Invoice RACINE AVE REC TRAIL/#5 08/05/2014 08/12/2014 61,320.02 814 202.08.94.74.6573
Total MUSSON BROS INC:89,089.11
OCCUPATIONAL HEALTH CENTERS
102246227 1 Invoice DOT TESTING 07/15/2014 08/12/2014 67.00 814 100.04.51.01.5227
102246227 2 Invoice DOT TESTING 07/15/2014 08/12/2014 67.00 814 100.04.51.01.5227
102246227 3 Invoice DOT TESTING 07/15/2014 08/12/2014 33.50 814 601.61.63.42.6056
102246227 4 Invoice DOT TESTING 07/15/2014 08/12/2014 33.50 814 605.56.09.30.5305
102253018 1 Invoice HEARING TEST 07/30/2014 08/12/2014 29.00 814 100.01.06.00.6021
Total OCCUPATIONAL HEALTH CENTERS :230.00
OFFICE MAX
864841 1 Invoice OFFICE SUPPLIES 07/11/2014 08/12/2014 200.20 814 100.02.20.01.5701
865685 1 Invoice OFFICE SUPPLIES 07/14/2014 08/12/2014 115.92 814 100.02.20.01.5701
Total OFFICE MAX:316.12
OLSON'S OUTDOOR POWER
41159 1 Invoice CHAINSAW SHARPENING & ROPE 08/08/2014 08/12/2014 51.10 814 215.06.00.00.5704
Total OLSON'S OUTDOOR POWER:51.10
OSI ENVIROMENTAL, INC
1022344 1 Invoice USED OIL 07/23/2014 08/12/2014 85.00 814 100.05.72.02.5735
Total OSI ENVIROMENTAL, INC:85.00
OTTER SALES & SERVICE, INC.
11921 1 Invoice ROADSIDE MOWER 07/16/2014 08/12/2014 15,000.00 814 410.08.93.51.6510
Total OTTER SALES & SERVICE, INC.:15,000.00
PAYNE & DOLAN OF WISCONSIN
1287237 1 Invoice ASPHALT 07/24/2014 08/12/2014 633.57 814 100.04.51.02.5740
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 11
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Total PAYNE & DOLAN OF WISCONSIN:633.57
PEACHTREE BUSINESS PROD.
P32389300101 1 Invoice 100 ADDTL PERMIT LABELS 07/15/2014 08/12/2014 210.00 814 100.01.03.00.5713
Total PEACHTREE BUSINESS PROD.:210.00
PEPPER, MIKE
14018 1 Invoice CAMP ASST.07/31/2014 08/12/2014 100.00 814 100.05.72.13.5110
Total PEPPER, MIKE:100.00
PICK N SAVE
PI81214 1 Invoice COURT ORDERED RESTITUTION 07/29/2014 08/12/2014 4.19 814 100.01.08.00.4269
Total PICK N SAVE:4.19
PIRANHA PAPER SHREDDING LLC
10122073114 1 Invoice PAPER SHREDDING 07/31/2014 08/12/2014 12.50 814 100.01.06.00.5701
1492073114 1 Invoice DOC SHREDDING 07/31/2014 08/12/2014 30.00 814 100.02.20.01.5723
Total PIRANHA PAPER SHREDDING LLC:42.50
PORT-A-JOHN
1227522 1 Invoice PK ARTHUR 07/22/2014 08/12/2014 66.00 814 100.05.72.02.5820
1227571 1 Invoice JENSEN PARK 07/23/2014 08/12/2014 66.00 814 100.05.72.02.5820
1227572 1 Invoice BAY LANE 07/23/2014 08/12/2014 132.00 814 100.05.72.02.5820
1227963 1 Invoice MORELAND PARK 08/01/2014 08/12/2014 66.00 814 100.05.72.02.5820
Total PORT-A-JOHN:330.00
POSTMASTER OF MUSKEGO
PO81214 1 Invoice 1ST CLASS PERSORT PERMIT#12 07/29/2014 08/12/2014 220.00 814 100.01.06.00.5710
PO81214-2 1 Invoice 2014 FALL PROGRAM GUIDE MAIL 08/04/2014 08/12/2014 1,650.89 814 100.05.72.10.5820
Total POSTMASTER OF MUSKEGO:1,870.89
PRIMARY POWER LLC
PR81214 1 Invoice REFUND/ELECT PERMIT/S70W175 07/25/2014 08/12/2014 30.00 814 100.02.25.00.4250
Total PRIMARY POWER LLC:30.00
PROHEALTH CARE
201407 1 Invoice OWI BLOOD DRAWS 07/31/2014 08/12/2014 140.00 814 100.02.20.01.5722
Total PROHEALTH CARE:140.00
PROMISING PICASSOS INC
2013-1922 1 Invoice CARTOON DRAWING CAMP 08/07/2014 08/12/2014 612.00 814 100.05.72.12.5110
Total PROMISING PICASSOS INC:612.00
PROSPECT HILL
156909 1 Invoice MULCH/WELLS 07/22/2014 08/12/2014 407.00 814 605.52.06.25.5702
Total PROSPECT HILL:407.00
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 12
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
PUBLIC POLICY FORUM
PU81214 1 Invoice MEMBERSHIP DUES 07/25/2014 08/12/2014 430.00 814 100.01.01.00.5305
Total PUBLIC POLICY FORUM:430.00
QUILL CORP
4561416 1 Invoice PAPER & TONER CART 07/18/2014 08/12/2014 384.93 814 100.05.72.10.5701
Total QUILL CORP:384.93
R & R INS. SRV., INC
1364374 1 Invoice RISK MANG 08/01/2014 08/12/2014 250.00 814 100.01.06.00.6021
Total R & R INS. SRV., INC:250.00
R.A. SMITH NATIONAL INC.
114298 1 Invoice RACINE AVE TRAIL CONSTRUCTI 08/08/2014 08/12/2014 6,973.12 814 202.08.94.74.6573
114340 1 Invoice CNTY OO REC TRAIL PLAN REVIE 08/06/2014 08/12/2014 1,789.50 814 202.08.94.74.6573
Total R.A. SMITH NATIONAL INC. :8,762.62
RACINE CNTY SHERIFFS DEPT
RA81214 1 Invoice BOND/NATALIE GARTZKE 07/22/2014 08/12/2014 502.50 814 100.01.08.00.4269
Total RACINE CNTY SHERIFFS DEPT:502.50
RAMIX QUALITY ASPHALT PRODUCTS
9471MB 1 Invoice ASPHALT 07/26/2014 08/12/2014 820.05 814 100.04.51.02.5740
RA81214 1 Invoice ASPHALT 07/19/2014 08/12/2014 2,047.10 814 100.04.51.02.5740
Total RAMIX QUALITY ASPHALT PRODUCTS:2,867.15
RED THE UNIFORM TAILOR
OOW57883 1 Invoice UNIFORM ITEM/MONREAL 07/31/2014 08/12/2014 119.90 814 100.02.20.01.5151
OW57846A 1 Invoice UNIFORM/NOWICKI 07/31/2014 08/12/2014 59.95 814 100.02.20.01.5151
Total RED THE UNIFORM TAILOR:179.85
RICOH AMERICAS CORP/CHICAGO
5031856969 1 Invoice COPIER CHARGES 08/01/2014 08/12/2014 11.39 814 100.01.04.00.5401
Total RICOH AMERICAS CORP/CHICAGO:11.39
ROZMAN TRUE VALUE/PD
88147 1 Invoice BLDG REAPIR ITEMS 06/30/2014 08/12/2014 34.47 814 100.02.20.01.5415
88244 1 Invoice BLDG REAPIR ITEMS 06/30/2014 08/12/2014 51.98 814 100.02.20.01.5415
Total ROZMAN TRUE VALUE/PD:86.45
ROZMAN TRUE VALUE/PK & REC
23750/81214 1 Invoice HISTORICAL SIGN MATERIALS 07/25/2014 08/12/2014 35.20 814 100.05.72.02.5415
23750/81214 2 Invoice MISCHDWE/PAINT/HINGES/TAPE/07/25/2014 08/12/2014 225.07 814 100.05.72.02.5702
Total ROZMAN TRUE VALUE/PK & REC:260.27
ROZMAN TRUE VALUE/PW
2200/81214 1 Invoice JANESVILLE RD ANCHORS, BENC 07/25/2014 08/12/2014 28.98 814 100.04.51.02.5742
2200/81214 2 Invoice HARDWARE & SUPPLIES 07/25/2014 08/12/2014 69.23 814 100.04.51.07.5704
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 13
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
2200/81214 3 Invoice COUPLING NIPPLE 07/25/2014 08/12/2014 8.38 814 100.04.51.04.5744
Total ROZMAN TRUE VALUE/PW:106.59
ROZMAN TRUE VALUE/UTI
25000/81214 1 Invoice MAINT BLDGS & GROUNDS 07/25/2014 08/12/2014 20.99 814 605.54.06.41.5702
25000/81214 2 Invoice NUTS, BOLTS, SCREWS 07/25/2014 08/12/2014 88.49 814 605.54.06.41.5702
25000/81214 3 Invoice misc SUPPLIES 07/25/2014 08/12/2014 56.91 814 601.61.61.15.5415
Total ROZMAN TRUE VALUE/UTI:166.39
SAFEWAY PEST MANAGEMENT INC.
470852 1 Invoice PEST CONTRO PD/JULY 07/21/2014 08/12/2014 35.00 814 100.02.20.01.5415
470853 1 Invoice PEST CONTRO LIB/JULY 07/21/2014 08/12/2014 30.00 814 100.05.71.00.5415
470854 1 Invoice PEST CONTROL/CH JULY 07/21/2014 08/12/2014 32.00 814 100.01.09.00.5415
Total SAFEWAY PEST MANAGEMENT INC.:97.00
SCHWEITZER, HARVEY
SC81214 1 Invoice MEMBER ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total SCHWEITZER, HARVEY:61.25
SHAWN ROBERT'S INC
3398 1 Invoice LAWN MOWING OF PARKS 08/01/2014 08/12/2014 3,718.75 814 100.05.72.02.5820
3398 2 Invoice GROUNDS MAINT PARKS 08/01/2014 08/12/2014 867.57 814 100.05.72.02.5820
3398 3 Invoice MAINT BLVDS AND TERRACES 08/01/2014 08/12/2014 1,590.00 814 100.01.06.00.5820
Total SHAWN ROBERT'S INC:6,176.32
SHERIDAN, ANN
SH81214 1 Invoice REIMB/VEST CARRIER 06/19/2014 08/12/2014 227.50 814 100.02.20.01.5151
Total SHERIDAN, ANN:227.50
SHERWIN-WILLIAMS CO.
3247-5 1 Invoice BLUHM DUMPSTER PAINT 07/14/2014 08/12/2014 54.79 814 100.05.72.02.5415
Total SHERWIN-WILLIAMS CO.:54.79
SIRCHIE FINGER PRINT LAB
172299-IN 1 Invoice EVIDENCE SUPPLIES 07/18/2014 08/12/2014 48.00 814 100.02.20.01.5722
Total SIRCHIE FINGER PRINT LAB:48.00
SLOCOMB, MARK
SL81214 1 Invoice MEMBER ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total SLOCOMB, MARK:61.25
SPOK
XO282335H 1 Invoice PAGERS/AUG 08/01/2014 08/12/2014 8.12 814 605.56.09.21.5607
XO282335H 2 Invoice PAGERS/AUG 08/01/2014 08/12/2014 8.12 814 601.61.63.42.5701
Total SPOK:16.24
STREICHER'S
I1103800 1 Invoice FLASHLIGHT/ONDRICKA 07/31/2014 08/12/2014 119.99 814 100.02.20.01.5151
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 14
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Total STREICHER'S:119.99
SUBURBAN ASPHALT INC
4686-1 1 Invoice ASPHALT-W16816 LYNN OAK CT 07/22/2014 08/12/2014 500.00 814 100.04.51.02.5741
Total SUBURBAN ASPHALT INC:500.00
SWANK MOTION PICTURES, INC.
1949028 1 Invoice MARY POPPINS 07/21/2014 08/12/2014 299.00 814 100.05.72.16.5820
Total SWANK MOTION PICTURES, INC.:299.00
TAPCO INC.
I460099 1 Invoice OPTI COM/RACINE & HILLENDALE 07/17/2014 08/12/2014 704.32 814 100.04.51.06.5916
Total TAPCO INC. :704.32
THE BUGMAN/AQUAFIX INC
13574 1 Invoice DAZZEL FRESH 07/09/2014 08/12/2014 2,547.26 814 601.61.61.16.5426
Total THE BUGMAN/AQUAFIX INC:2,547.26
THE UPS STORE #3692
TH81214 1 Invoice SHIPPING 08/08/2014 08/12/2014 18.70 814 215.06.00.00.5704
Total THE UPS STORE #3692:18.70
TIME WARNER CABLE
701507601/812 1 Invoice WAN ETHERNET CONNECTION C 08/06/2014 08/12/2014 180.00 814 100.05.72.01.5506
701507601/812 2 Invoice DEDICATED INTERNET CIRCUIT 08/06/2014 08/12/2014 933.15 814 100.01.14.00.5507
702969401/812 1 Invoice PK & REC MTHLY CHG 07/22/2014 07/30/2014 69.95 714 100.05.72.01.5506
Total TIME WARNER CABLE:1,183.10
TOP FLIGHT TRAINING
7302014 1 Invoice TRACK AND FIELD CAMP 07/30/2014 08/12/2014 696.00 814 100.05.72.13.5110
Total TOP FLIGHT TRAINING:696.00
TOSHIBA FINANCIAL SRVS
258902246 1 Invoice COPIER LEASE 08/08/2014 08/12/2014 222.00 814 100.06.18.01.5410
Total TOSHIBA FINANCIAL SRVS:222.00
TRANSUNION RISK & ALTERNATIVE
TR81214 1 Invoice PERSON SEARCHES 08/01/2014 08/12/2014 14.25 814 100.02.20.01.5722
Total TRANSUNION RISK & ALTERNATIVE:14.25
TRIEBOLD OUTDOOR POWER LLC
IC15059 1 Invoice 5030 LOADER PARTS 07/18/2014 08/12/2014 83.45 814 100.05.72.02.5415
IC15059 2 Invoice F3080 AXLE/BOLTS 07/18/2014 08/12/2014 210.38 814 100.05.72.02.5415
IC15059 3 Invoice F3080 AXLE/PARTS/KIT A SPIN 07/18/2014 08/12/2014 147.41 814 100.05.72.02.5415
IC15059 4 Invoice FREIGHT 07/18/2014 08/12/2014 12.59 814 100.05.72.02.5415
Total TRIEBOLD OUTDOOR POWER LLC:453.83
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 15
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
UNISOURCE
517-67318748 1 Invoice COPY PAPER 07/14/2014 07/30/2014 577.00 714 100.01.06.00.5701
517-67318748 2 Invoice CREDIT 07/14/2014 07/30/2014 6.09-714 100.02.20.01.5701
517-67318748 3 Invoice 3 HOLE PAPER/ELECTION 07/14/2014 07/30/2014 32.40 714 100.01.03.00.5704
Total UNISOURCE:603.31
USA BLUE BOOK
392269 1 Invoice CHEMICAL FEED 07/09/2014 08/12/2014 106.86 814 605.53.06.31.5702
Total USA BLUE BOOK:106.86
USA FIRE PROTECTION
US81214 1 Invoice ANL INSPECTION 07/08/2014 08/12/2014 142.50 814 100.04.51.08.5415
US81214 2 Invoice ANL INSPECTION 07/08/2014 08/12/2014 71.25 814 601.61.61.15.5415
US81214 3 Invoice ANL INSPECTION 07/08/2014 08/12/2014 71.25 814 605.54.06.41.5702
Total USA FIRE PROTECTION:285.00
VERIZON WIRELESS
9728390151 1 Invoice MONTHLY CHARGE - POLICE 08/08/2014 08/12/2014 185.16 814 100.02.20.01.5604
Total VERIZON WIRELESS:185.16
VOGEL, SUSAN
14064 1 Invoice CAMP DIRECTOR 08/05/2014 08/12/2014 400.00 814 100.05.72.13.5110
Total VOGEL, SUSAN:400.00
WALEJEWSKI, JOHN
WA81214 1 Invoice WITNESS FEES CITATION #Q9027 07/25/2014 08/12/2014 49.80 814 100.01.08.00.6004
Total WALEJEWSKI, JOHN:49.80
WAL-MART COMMUNITY
WA81214 1 Invoice GAP ACENIVAL ITEMS 06/24/2014 07/30/2014 56.97 714 100.05.72.16.5702
WA81214 2 Invoice GAP SNACKS & SUPPLIES 06/24/2014 07/30/2014 197.48 714 100.05.72.16.5702
WA81214 3 Invoice GAP ART 06/24/2014 07/30/2014 5.84 714 100.05.72.16.5702
WA81214 4 Invoice GAP CLUBS/FOOTBALL/CARDS/G 06/24/2014 07/30/2014 124.47 714 100.05.72.16.5702
WA81214 5 Invoice GAP CLUBS/GARDEN 06/24/2014 07/30/2014 14.51 714 100.05.72.16.5702
WA81214 6 Invoice HAND SOAP 06/24/2014 07/30/2014 23.82 714 100.05.72.02.5702
Total WAL-MART COMMUNITY:423.09
WATER BUGS SKI TEAM, INC
14109 1 Invoice WATER SKI LESSONS 07/31/2014 08/12/2014 520.00 814 100.05.72.11.5110
Total WATER BUGS SKI TEAM, INC:520.00
WAUK CNTY REGISTER OF DEEDS
107 - 8/12/14 1 Invoice RECORDING FEES - ADV DISP/FO 08/08/2014 08/12/2014 30.00 814 507.00.00.00.2667
107 - 8/12/14 2 Invoice RECORDING FEES - INPRO CORP 08/08/2014 08/12/2014 30.00 814 507.00.00.00.2642
Total WAUK CNTY REGISTER OF DEEDS:60.00
WAUK CNTY TECH COLLEGE
SO466706 1 Invoice EVOC TRAINING - C.A.06/25/2014 08/12/2014 117.54 814 100.02.20.01.5721
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 16
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Total WAUK CNTY TECH COLLEGE:117.54
WAUKESHA COUNTY PARKS & LAND USE DEPT
2014-46 1 Invoice SUMMER FISHING CLINICS 08/04/2014 08/12/2014 572.00 814 100.05.72.18.5820
WA81214 1 Invoice MEETING ATTENDANCE 8/4/14 08/05/2014 08/12/2014 61.25 814 207.01.00.00.6055
Total WAUKESHA COUNTY PARKS & LAND USE DEPT:633.25
WAUKESHA COUNTY TREASURER
WA81214 1 Invoice JAIL ASSMTS/JULY 08/05/2014 08/12/2014 1,040.00 814 100.01.08.00.4269
WA81214 2 Invoice DRIVE SURCHG/JULY 08/05/2014 08/12/2014 2,242.26 814 100.01.08.00.4269
WA81214 3 Invoice INTERLOCK SURCHG/JULY 08/05/2014 08/12/2014 250.00 814 100.01.08.00.4269
Total WAUKESHA COUNTY TREASURER:3,532.26
WE ENERGIES
0000-020-164/1 Invoice CITY GROUP BILL/CH 07/25/2014 07/30/2014 3,482.73 714 100.01.09.00.5910
0000-020-164/2 Invoice CITY GROUP BILL/PD 07/25/2014 07/30/2014 2,411.66 714 100.02.20.01.5910
0000-020-164/3 Invoice CITY GROUP BILL/ST LTS 07/25/2014 07/30/2014 3,890.98 714 100.04.51.06.5910
0000-020-164/4 Invoice CITY GROUP BILL/SALT SHED 07/25/2014 07/30/2014 21.78 714 100.04.51.06.5910
0000-020-164/5 Invoice CITY GROUP BILL/IND PK LTS 07/25/2014 07/30/2014 213.00 714 100.04.51.06.5910
0000-020-164/6 Invoice CITY GROUP BILL/LT LK DAM 07/25/2014 07/30/2014 16.45 714 100.04.51.08.5910
0000-020-164/7 Invoice CITY GROUP BILL/GARG 50%07/25/2014 07/30/2014 614.78 714 100.04.51.08.5910
0000-020-164/8 Invoice CITY GROUP BILL/SWR 25%07/25/2014 07/30/2014 307.40 714 601.61.61.20.5910
0000-020-164/9 Invoice CITY GROUP BILL/WTR 25%07/25/2014 07/30/2014 307.40 714 605.56.09.21.5910
0000-020-164/10 Invoice CITY GROUP BILL/PKS 07/25/2014 07/30/2014 740.91 714 100.05.72.02.5910
0000-020-164/11 Invoice CITY GROUP BILL/PKS GARG 07/25/2014 07/30/2014 408.33 714 100.05.72.02.5910
0000-020-164/12 Invoice CITY GROUP BILL/ST LTS TESS 07/25/2014 07/30/2014 107.44 714 100.04.51.06.5910
0000-020-164/13 Invoice CITY GROUP BILL/COMM CNTR 07/25/2014 07/30/2014 21.54 714 100.05.72.02.5910
0000-020-351/1 Invoice WELLS/ELECTRIC 07/28/2014 08/12/2014 4,985.84 814 605.52.06.22.5910
0000-020-351/2 Invoice WELL 7/GAS 07/28/2014 08/12/2014 9.92 814 605.52.06.22.5910
0000-021-027/1 Invoice L/S GAS & ELEC 6/14 07/22/2014 07/30/2014 11,666.37 714 601.61.61.20.5910
000021134/812 1 Invoice CITY GROUP GAS BILL/CH 07/25/2014 07/30/2014 469.85 714 100.01.09.00.5910
000021134/812 2 Invoice CITY GROUP GAS BILL/PD 07/25/2014 07/30/2014 37.58 714 100.02.20.01.5910
000021134/812 3 Invoice CITY GROUP GAS BILL/GARG 50%07/25/2014 07/30/2014 18.04 714 100.04.51.08.5910
000021134/812 4 Invoice CITY GROUP GAS BILL/SWR 25%07/25/2014 07/30/2014 9.03 714 601.61.61.20.5910
000021134/812 5 Invoice CITY GROUP GAS BILL/WTR 25%07/25/2014 07/30/2014 9.03 714 601.61.61.20.5910
000021134/812 6 Invoice CITY GROUP GAS BILL/PKS 07/25/2014 07/30/2014 27.05 714 100.05.72.02.5910
000021134/812 7 Invoice CITY GROUP GAS BILL/PKS GARG 07/25/2014 07/30/2014 8.99 714 100.05.72.02.5910
0263-955-013/1 Invoice W13440 JANES/SIGN LT 07/28/2014 08/12/2014 16.95 814 100.04.51.06.5910
0650-659-591/1 Invoice S7795 PIONEER/ST LT 07/28/2014 08/12/2014 160.69 814 100.04.51.06.5910
1210375582/81 1 Invoice RANGE 07/18/2014 08/12/2014 17.18 814 100.02.20.01.6023
1222-851-033/1 Invoice WELL 9 ELEC 07/22/2014 07/30/2014 415.56 714 605.52.06.22.5910
1222-851-033/2 Invoice WELL 9, GAS 07/22/2014 07/30/2014 15.19 714 605.52.06.22.5910
2288-776-743/1 Invoice W15913 JANES/ST LT 07/28/2014 08/12/2014 320.05 814 100.04.51.06.5910
4223-489-258/1 Invoice WELL 13 GAS/JULY 08/04/2014 08/12/2014 9.30 814 605.52.06.22.5910
4277-310-008/1 Invoice W17007 JANES/ST LT 07/28/2014 08/12/2014 162.73 814 100.04.51.06.5910
5024-948-351/1 Invoice HILLENDALE GAS/JULY 07/31/2014 08/12/2014 20.66 814 605.52.06.22.5910
5063-865-935/1 Invoice W18167 JANES/ST LT 07/28/2014 08/12/2014 362.43 814 100.04.51.06.5910
5271-186-125/1 Invoice S63W17833 COLLEGE AVE/SLED 07/29/2014 08/12/2014 252.05 814 100.05.72.02.5910
5499-564-961/1 Invoice GROUP GAS/LIB 08/04/2014 08/12/2014 1,041.34 814 100.05.71.00.5910
5499-564-961/2 Invoice GROUP ELEC/LIB 08/04/2014 08/12/2014 6,986.56 814 100.05.71.00.5910
5499-564-961/3 Invoice GAS & ELECT/HIST 08/04/2014 08/12/2014 278.99 814 100.05.72.03.5910
5499-564-961/4 Invoice ADDLT POLE LT/HIST 08/04/2014 08/12/2014 13.49 814 100.05.72.02.5910
5499-564-961/5 Invoice ARCH 08/04/2014 08/12/2014 24.50 814 100.05.72.02.5910
5499-564-961/6 Invoice FOUNTAIN 08/04/2014 08/12/2014 34.38 814 100.05.72.02.5910
5499-564-961/7 Invoice PAVILION 08/04/2014 08/12/2014 107.01 814 100.05.72.02.5910
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 17
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
5499-564-961/8 Invoice AREA LTS 08/04/2014 08/12/2014 114.24 814 100.05.72.02.5910
5499-564-961/9 Invoice VET PARK 08/04/2014 08/12/2014 44.84 814 100.05.72.02.5910
5836-104-158/1 Invoice L/S JULY 07/30/2014 08/12/2014 860.12 814 601.61.61.20.5910
6684-374-692/1 Invoice COLLEGE-PK ARTHYR OK PAVL 07/28/2014 08/12/2014 270.92 814 100.04.51.06.5910
7202-321-889/1 Invoice MOORLAND ST LTS 07/28/2014 08/12/2014 158.80 814 100.04.51.06.5910
7613-832-186/1 Invoice S63W17833 COLLEGE AVE/3 BB FI 07/29/2014 08/12/2014 248.24 814 100.05.72.02.5910
7652-884-955/1 Invoice W16446 JANES/ST LT 07/28/2014 08/12/2014 401.43 814 100.04.51.06.5910
8695-949-170/1 Invoice SHOOT HOUSE 07/18/2014 08/12/2014 28.62 814 100.02.20.01.6023
9495-306-298/1 Invoice RYAN L/S ELEC/JUNE 07/21/2014 08/12/2014 14.68 814 601.61.61.20.5910
Total WE ENERGIES:42,167.05
WEBBER, WILLIAM
WE81214 1 Invoice WITNESS FEE/#DL80NMQKRD 07/24/2014 08/12/2014 7.85 814 100.01.08.00.6004
Total WEBBER, WILLIAM:7.85
WEX BANK
36403651 1 Invoice SQD REPAIR 04/04/2014 08/04/2014 45.00 814 100.02.20.01.5405
37455389 1 Invoice SQD REPAIRS 07/04/2014 08/04/2014 15.00 814 100.02.20.01.5405
Total WEX BANK:60.00
WI BLDG INSPECTION LLP
129 1 Invoice JULY PERMITS 08/08/2014 08/12/2014 20,002.82 814 100.02.25.00.5820
Total WI BLDG INSPECTION LLP:20,002.82
WI DEPT OF JUSTICE - TIME
T17548 1 Invoice TIME SYS ACCESS & SUPPORT/Q 07/11/2014 08/12/2014 300.00 814 100.01.08.00.5702
Total WI DEPT OF JUSTICE - TIME:300.00
WIS DEPT OF ADMIN
WI/81214 1 Invoice COURT FEES/JULY 08/05/2014 08/12/2014 8,035.87 814 100.01.08.00.4269
Total WIS DEPT OF ADMIN:8,035.87
WIS DEPT OF JUSTICE
L6806T/81214 1 Invoice NAME & RECORD SEARCHES 08/01/2014 08/12/2014 280.00 814 100.01.06.00.6002
Total WIS DEPT OF JUSTICE:280.00
ZORN COMPRESSOR & EQUIP INC
180151-00 1 Invoice VALVE-WELL 10 07/23/2014 08/12/2014 5.50 814 605.51.06.05.5702
Total ZORN COMPRESSOR & EQUIP INC:5.50
Grand Totals: 454,440.13
CITY OF MUSKEGO Payment Approval Report - Board Report Alpha Page: 18
Report dates: 7/24/2014-8/12/2014 Aug 08, 2014 11:41AM
Invoice Number SeqNo Type Description Invoice Date Payment Due Date Total Cost GL Period GL Account Number
Report Criteria:
Detail report.
Invoices with totals above $0 included.
Paid and unpaid invoices included.
[Report].Description = {<>} "1099 adjustment"
Invoice Detail.Type = {>} "adjustments"
OVER ->
City of Muskego
Finance & Administration Department
Sharon Mueller
Finance & Administration Director
Finance & Administration Department Quarterly Report
August 12th, 2014, Finance Committee Meeting
Major Projects and Activities being worked on within the Finance & Administration Department:
Elections – The upcoming elections for 2014 will include the August 12th Partisan Primary and November 4th General
Election.
Tax Roll/Rates/Bills – Final settlement with Waukesha County is scheduled for August 15th.
2013 Audit (Operating, Special Revenue, Capital, BML, Sewer & Water Utility – As reported in the first quarter,
field work began on April 30th and was completed by May 8th. Additional work papers were required due to the debt
issue refunding’s and new GASB (Governmental Accounting Standards Board) requirements. First draft financial
statements were completed on May 19th, which was followed by preparation of the Management Discussion and
Analysis (MD&A). The presentation of the annual audit report by Baker Tilly is scheduled to take place at the
August 12th Finance Committee meeting.
Requested Water Rate Increase – On June 3rd, the Public Service Commission (PSC) notified the City that the
Water Utility did qualify for a simplified rate case (SRC) increase of 3% based upon the 2013 audit results and annual
report. The request to move forward with the process was presented to the Finance Committee on June 24th. The
motion carried unanimously. Following public notice, the PSC must officially authorize the water rate increase.
Once the City receives notice of the final determination, the request to implement the rate increase will be brought
before the Common Council. The SRC is highly recommended by the City Auditors and PSC, especially once the
working capital balance within the Water Utility operations and maintenance fund falls below the recommended
minimum.
2015 Budgets – The tentative 2015 Budget Timeline will be distributed to Council at the May 27th meeting, which
was followed by a budget ‘guide/goal’ outline presented by the Mayor at the June 24th COW meeting. The first
budget work meeting will take place at the August 21st COW meeting and will cover the proposed capital projects.
Payroll/Benefit Administration –
2nd Quarter Federal and State payroll tax reports reconciled and submitted to the IRS and DOR on July 25th.
The City Wellness Program Health Risk Assessment took place May 12th – 16th. Total employee participation
was 99%. Final assessment reports indicated positive results and employee feedback.
New WPS contract changes were communicated to the Finance Committee on June 10th and were
implemented successfully. Rate negotiations resulted in a slight premium increase of 3.8% and is well under
budget.
Investments – Annual interest earnings from investments in the Certificate of Deposit Account Registry Service
Network (CDARS) are holding steady with no changes to report.
FINANCE & ADMIN. DIRECTOR’S REPORT 08/12/14
PAGE 2
2
2nd Quarter Utility Bills – Billings and collections processed in a timely manner with no issues to report.
Wisconsin Revolving Loan Fund Semi-Annual Report Certification – Reconciled and submitted to the
Department of Commerce on April 11th.
Licensing – Staff has continued work on preparing and issuing various licenses and permits.
Other Projects – Continued progression within the following applications: miTime (electronic timekeeping),
Document Management/Work Flow, Civic Plus, respective Web pages and implementing the final financial software
module upgrade for Improvement Districts, which is scheduled for August 26th.
2nd Quarter, 2014 General Fund Operating Results – See attached.
CITY OF MUSKEGO
DEPARTMENT OF FINANCE & ADMINISTRATION
W182 S8200 Racine Avenue, Muskego, WI 53150
M E M O R A N D U M
TO: Finance Committee and Common Council
FROM: Sharon Mueller, Director of Finance & Administration
DATE: August 12, 2014
RE: 2014 2nd Quarter Operating Results
________________________________________________________________________
The attached worksheets recap the City’s General Fund operating results for the second
quarter ending June 30th, 2014. As reported, the year-to-date expenditures are under
budget by (-)55.50%, which is comparable to the prior year and well within the (-)50% (6
months remaining July-December/12 months) benchmark. Although mid-year, it should
be noted there are several accounts under budget either due to the timing of funds
received or project status. Results in these categories typically level out within the 3rd
quarter.
At this point, current projections indicate year-end results should be positive due to
several staffing transitions and vacancies.
Should you have any questions, please email or contact me at (262) 679-5622 with any
questions.
Thank you.
June 30, 2014
General Government Budget Actual Over/(Under) % Over/(Under)Actual Cost Breakdown
Common Council/Mayor $221,788 $109,411 -$112,377 -50.67%
Finance & Administration $588,144 $278,775 -$309,369 -52.60%
Assessor $225,060 $108,028 -$117,032 -52.00%
Attorney $95,000 $38,093 -$56,907 -59.90%
Non-Departmental $487,699 $309,120 -$178,579 -36.62%
Municipal Court $197,026 $97,593 -$99,433 -50.47%
Building Maintenance $174,778 $82,773 -$92,005 -52.64%
Information Technology $309,360 $144,153 -$165,207 -53.40%
Bank Service Charges $18,000 $8,456 -$9,544 -53.02%
Total $2,316,855 $1,176,402 -$1,140,453 -49.22%
Public Safety Budget Actual Over/(Under) % Over/(Under)
Police - Sworn Officers $4,524,268 $2,123,937 -$2,400,331 -53.05%
Police - Dispatch & Clerical $645,121 $286,140 -$358,981 -55.65%
Volunteer Fire $736,465 $216,195 -$520,270 -70.64%
Non-Departmental $30,187 $28,332 -$1,855 -6.15%
Building Inspection $203,561 $110,478 -$93,083 -45.73%
Total $6,139,602 $2,765,082 -$3,374,520 -54.96%
Health & Human Services Budget Actual Over/(Under) % Over/(Under)
Animal Warden $3,600 $3,581 -$19 -0.53%
Public Safety Supplies & Expenses $50 $14 -$36 -72.00%
Total $3,650 $3,595 -$55 -1.51%
Public Works Budget Actual Over/(Under) % Over/(Under)Budget vs. Actual
Engineering $184,703 $87,141 -$97,562 -52.82%
Public Works $1,902,917 $1,074,358 -$828,559 -43.54%
Total $2,087,620 $1,161,499 -$926,121 -44.36%
Culture, Recreation & Education Budget Actual Over/(Under) % Over/(Under)
Parade Fund & Little Lake District $57,500 $59,419 $1,919 3.34%
Library $1,255,167 $594,871 -$660,296 -52.61%
Parks $551,336 $266,100 -$285,236 -51.74%
Recreation $582,311 $199,887 -$382,424 -65.67%
Total $2,446,314 $1,120,277 -$1,326,037 -54.21%
Conservation & Development Budget Actual Over/(Under) % Over/(Under)
Planning, Conservation & Development $345,716 $162,769 -$182,947 -52.92%
Total $345,716 $162,769 -$182,947 -52.92%
Capital Outlay-Operations Budget Actual Over/(Under) % Over/(Under)
Computer Replacements $57,000 $13,923 -$43,077 -75.57%
Police Vehicle Replacements $104,483 $46 -$104,437 -99.96%
Road Program $625,000 $0 -$625,000 -100.00%
Public Works Vehicle Replacements $183,750 $0 -$183,750 -100.00%
Contingency $79,749 $0 -$79,749 -100.00%
Total $1,049,982 $13,969 -$1,036,013 -98.67%
Total Expenditures Budget Actual Over/(Under) % Over/(Under)
$14,389,739 $6,403,593 ($7,986,146)
-55.50%
2014 Budget Quarter 2 Results: EXPENDITURES
General Fund -
Annual Operating Results
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
Budget Actual
18%
43%0%18%
18%3%0%
General Government
Public Safety
Health & Human Services
Public Works
Culture, Recreation & Education
Conservation & Development
Capital Outlay-Operations
June 30, 2014
Budget Actual Over/(Under) % Over/(Under)Revenue Comparison
Taxes $10,045,398 $10,029,061 -$16,337 -0.16%
Intergovernmental $1,685,622 $560,112 -$1,125,510 -66.77%
Licenses and Permits $633,870 $352,697 -$281,173 -44.36%
Fines, Forfeits and Penalties $187,000 $123,961 -$63,039 -33.71%
Public Charges for Services $707,495 $426,914 -$280,581 -39.66%
Intergov. Charges for Services $141,500 $70,303 -$71,197 -50.32%
Miscellaneous $165,194 $125,240 -$39,954 -24.19%
Other Financing Sources $609,000 $10,526 -$598,474 -98.27%
Interdepartmental $214,660 $41,715 -$172,945 -80.57%
Total Revenue
$14,389,739 $11,740,529 ($2,649,210) -18.41%
2014 Budget Quarter 2 Results: REVENUES
General Fund -
Annual Operating Results
85%
5%
3%
1%
4%
1%
1%
0%
0%
Taxes
Intergovernmental
Licenses and Permits
Fines, Forfeits and Penalties
Public Charges for Services
Intergov. Charges for Services
Miscellaneous
Other Financing Sources
Interdepartmental
June 30, 2014
2014 2013 Comparison Revenues vs. Expenditures
Total Revenues $11,740,529 $11,568,340 $172,189
Total Expenditures $6,403,593 $6,419,821 ($16,228)
Total
Surplus/(Deficit)
$5,336,936 $5,148,519 $188,417
General Fund -
Annual Operating Results
Quarter 2 Budget Results - 2014 vs. 2013
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
2014 2013
CITY OF MUSKEGO
Staff Report to Public Works Committee
To: Public Works Committee
From: David Simpson, P.E., Director of Public Works/City Engineer
Subject: Discuss Jensen Park lift station improvement project
Date: July 18, 2014
As part of the City’s continued efforts to increase sanitary sewer system reliability we
are working to improve the lift station controls at various lift stations. Because we are
now unable to upgrade the controls at the Lake Drive lift station based on the June
Public Works Committee decision we would now like to move on to the next lift station
that needs to be upgraded. During the large rain events in 2008 and 2012 we
experienced very heavy flows throughout the system and at this (and other) lift station
we have to descend into the underground vault in order to reset breakers and make
adjustments. Because it is a confined space we are required to have a two man team at
the site to enter the control area. Because we have a limited staff and 26 lift stations
that need monitoring during rain events (as well as routine maintenance) moving the
controls above ground would free up a staff member to be free for other locations
during emergencies.
This lift station was constructed in 1970 and the controls are in need of replacement at
this time as well. Moving the controls above ground will improve our ability to respond
to emergency situations effectively and efficiently. We completed a very similar project
at the Williams Drive lift station, however, this project will require a larger building
and has a larger cost because a generator replacement is necessary at this loca tion as
well. Pictured below is the existing generator enclosure that will be replaced with this
project.
This project category was budgeted for the Lake Drive lift station in the amount of
$100,000. Completion of the Jensen Park lift station will cost approximately $55,000
more because of the generator replacement required at this site. The sewer utility has
working capital available to fund this project at this time.
Recommendation for Action by Committee:
Authorize staff to proceed with the Jensen Park lift station upgrade project at this time.