The review process is very simple. It involves only two worksheets (schedules). [NOTE: Most people are not interested in the details of forms and explanations of the forms. However, in The CAFR eBook both forms are presented in a couple of ways as well as a spread sheet program and a word processing program for each of school district, city, county and State.]
-Two forms -A calculator.
Steps in conducting a review and preparing the economic impact analysis
1. Get a copy of the governments/school districts most currrent Comprehensive Annual Financial Report (CAFR).
2. Go to each fund/subfund section , locate the accounts with surpluses based on the steps shown below; total them for each subfund, and write them down as shown below. In addition the Exhibit A in each of the State reports provided in this writing. The Exhibit A is the complete review. So a person has over 40 examples to use in the learning process.
3. Total the list of subfund surpluses to arrive at the total surpluses for the government.
4. Divide the result in Step 3. by the population and you have the per capita surpluses.
5. Take the total surplus amount to the proper economic impact form and complete the computations shown for each cell in the economic impact form. The computations are very simple.
That’s it. The next step is preparing a report on the results of the review and economic impact analysis. Go to the Report Section of this writing.
THE COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) REVIEW
The Typical Table of Contents
Most Table of Contents usually have this sort of format. The Schedules in red are the ones that we will be using to determine surpluses.
Table of Contents
|Letter of Transmittal||1|
|State Government Organizations||8|
|Principal State Officials||9|
|INDEPENDENT AUDITORS’ REPORT||15|
|MANAGEMENT’S DISCUSSION AND ANALYSIS||21|
|BASIC FINANCIAL STATEMENTS|
|Governmental-wide Financial Statements:|
|Statement of Net Assets||36|
|Statement of Activities||40|
|Governmental Fund Financial Statements:|
|Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets||44|
|Statement of Revenues, Expenditures and Changes in Fund Balances||45|
|Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities||46|
|Proprietary Fund Financial Statements:|
|Statement of Net Assets||48|
|Statement of Revenue, Expenses and Changes in Fund Net Assets||52|
|Statement of Cash Flows||54|
|Fiduciary Fund Financial Statements:|
|Statement of Fiduciary Net Assets||58|
|Statement of Changes in Fiduciary Net Assets||59|
|Component Unit Financial Statements:|
|Combing Statement of Net Assets||61|
|Combing Statement of Activities||62|
|Notes to the Financial Statements||64|
|REQUIRED SUPPLEMENTARY INFORMATION|
|(Table of Contents items not shown)|
|COMBINING FINANCIAL STATEMENTS AND SCHEDULES|
|Combining Balance Sheet||146|
|Combining Statement of Revenue, Expenditures and Changes in Fund Balances||147|
|Special Revenue Funds:|
|Combining Balance Sheet||150|
|Combining Statement of Revenues, Expenditures and Changes in Fund Balances…||152|
|Debt Service Funds:|
|Combining Balance Sheet||156|
|Combining Statement of Revenues, Expenditures and Changes in Fund Balances…||158|
|Capital Project Funds:|
|Combining Balance Sheet||162|
|Combining Statement of Revenues, Expenditures and Changes In Fund Balances…||163|
|Combining Statement of Net Assets||166|
|Combining Statement of Revenues, Expenses and Changes in Fund Balances||168|
|Combining Statement of Cash Flows||170|
|Internal Service Funds:|
|Combining Statement of Net Assets||174|
|Combining Statement of Revenues, Expenses and Changes in Fund Balances||176|
|Combining Statement of Cash Flows||178|
|Pension Trust Funds:|
|Combining Statement of Fiduciary Net Assets||182|
|Combining Statement of Changes in Fiduciary Net Assets||183|
|Investment Trust Funds:|
|Combining Statement of Fiduciary Net Assets||186|
|Combining Statement of Changes in Fiduciary Net Assets||187|
|Combining Statement of Assets and Liabilities||191|
|Combining Statement of Changes in Assets and Liabiliities||192|
|(Many items shown here)|
|Population by County for the Last Ten Years||216|
You can see that the schedules in red are not very many. Now there are three schedules that are in green. Whether there are surpluses in these three schedules depends on circumstances which will be explained later.
What type of accounts are we interested in
Here is a partial list of the types of names that are given to cash and investment type accounts. There are more in the reports in this writing:
Amounts on deposit with U.S. Treasury Cash and cash equivalents Cash and Investments Cash with fiscal agents Collateral on lent securities Dedicated Investments Investments net amortization Investments, non-current Other assets Pooled Investments with State Treasury Securities lending cash collateral Restricted cash and cash equivalents Restricted investments
In the schedules listed below the cash and investments that are used to compute the surpluses are marked in red.
Items not Included
The following items are not included in the amount of surplus shown:
-Buildings, roads, bridges, land (not for sale), and equipment.
-Deferred compensation plans for employees. These are plans in which the employee contributes to his/her retirement over and above the normal employee retirement contribution.
-Any fund that is 100% supported by donations, bequests, gifts, endowments, etc. These are not taxpayers money.
-For Colleges and Universities. All endowment and similar-type funds should not be included as surpluses. Sometimes these funds are combined with other college/university funds. We are interested in surpluses, so in these cases the total amount should not be included.
-Funds in which the revenues/contributions are 100% held for other individuals, organizations or another government. (Note: There are sometimes problems in the way these funds are described and can result in the fund being considered surplus due to the lack of enough information.)
-Funds that are required by law in which a bank, financial institution, insurance companies, etc. are required to deposit with the government a certain amount for insurance against the entity going bankrupt. These are not taxpayers’ money.
-Retirement/Pension Funds – only included are 1/2 of the actuarial determined excesses, the taxpayers portion. The other 1/2 is the government employees portion.
What Schedules Do we Look At
In the CAFR we are only interested in certain schedules in that massive document you have of schedules. These are the schedules you will be looking at:
Combining Schedule of Accounts
We forget about the rest of the schedules. This means that we have excluded almost 2/3 of the schedules. Now we are down to less than 35 schedules (pages) for States and much less for school districts, cities, and counties. I have had school districts that I used only 10 schedules (pages) to conduct the review of the CAFR. With a State CAFR of over 200 or more pages, 35 max is very little.
Basic Financial Statements
Go to the Section called “Basic Financial Statements” in the CAFR.
Note: The page number shown next to the “(Expressed in Thousands)” is added so that you can see in the Table Of Contents what schedule is being used.
The first schedule you see looks something like this:
(Expressed in Thousands)- Page 36
|Governmental Activities||Activities||Government||Component Units|
|Cash with U.S. Treasury||860,872||860,872|
|Cash and pooled investments with State Treasurer||1,537,024||169,818||1,706,842||53,497|
|Cash held by trustee||24,489|
You can forget the above-type schedule. These data will be provided again broken down into something meaningful. Note: I have put the page number so that you can relate to the Table of Contents for the schedule.
This is the first schedule that is important. The figures in red are the surpluses.
The Page Nr. 146 shows the page in which the Other Governmental Funds are shown in more detail, so they are not used here for surpluses.
Balance Sheet GOVERNMENTAL FUNDS(Expressed In Thousands)-Page 43
|General Fund||Transportation & Aviation Planning Highway Maintenance & Safety Fund||Land Endowments Fund||(Page 146) Other Governmental Funds|
|Cash and pooled investments with State Treasurer||564,659||151,425||60,203||691,158|
|Receivables, net of allowance|
|Loans and Notes||260,229|
|Due from U.S. Government||148,021||69,929||153|
|Due from local governments||1,577||41|
|Due from others||9|
|Due from other funds||276,216||20,264||291||57,607|
|Inventory of food stamps||86|
|Inventories, at cost||11,300||4,693||2,607|
|Cash and pooled investments with State Treasurer||18,259||312,889||192,697|
|Cash held by trustee||86,843||33,611|
|(Following not part of schedule)|
This is the second schedule that is important. The figures in red are the surpluses.
Statement of Net Assets PROPRIETARY FUNDS(Expressed In Thousands)-Page 48 BUSINESS ACTIVITES-ENTERPRISE FUNDS
|Universities||Unemployment Compensation||Industrial Commission||Other|
|Cash with U.S. Treasury||860,872|
|Cash and pooled investments with State Treasurer||115,978||308||18,596|
|Collateral investment pool||34,251||35,274|
|Receivables, net of allowance|
|Loans and Notes||4,320||4,357|
|Due from U.S. Government||53,234||11,692||17||58|
|Due from local governments||381|
|Due from other funds||109,632|
|Inventories, at cost||17,326||7,939|
|Other Current Assets||4,442||567|
|Total Current Assets||407,481||912,252||43,740||146,998|
|Cash and pooled investments with State Treasurer||102,398|
|Cash held by trustee||25,809|
|Investments held by trustee||103,174||3,387|
|Loans and notes receivable, net of allowance||27,838||24,256|
|Other long-term assets||10,227||179|
|Infrastructure, land and other non-deppeciable||296,227||2,997||2,063|
|Deppreciable buildings, property and equipment||3,465,743||27,303||55,587|
|Less: accumulated depreciation||(1,628,342)||(5,584)||(35,897)|
|Total Non-current Assets||2,758,226||213,507||148,586|
|(Following not part of schedule)|
The special elite decide on how the wealth will be distributed among the people. All life styles, standard of living, actions, thoughts, and even life itself is decided by the state because the state owns and controls everything. Is it possible that communism could be created within a capitalistic society without a revolution? Have we already reached that point?
Returning Surpluses Reverses the Trend
Returning surpluses to the people will reverse the trend of wealth transfers and increase the percent owned and controlled by 90% of the people. This increase in people-control could greatly assist in restoring the “Republic” form of government outlined by the founders. Although this not a cure, it is a step in the right direction.
What St. Augustine had to say about what we now call government:
“A gang is a group of men under the command of a leader, bound by a compact of association, in which the plunder is divided according to an agreed convention. If this villainy wins so many recruits from the ranks of the demoralized that it acquires territory, establishes a base, captures cities and subdues peoples, it then openly arrogates to itself the title of kingdom, which is conferred on it in the eyes of the world, not by the renunciation of aggression, but by the attainment of impunity”
Your Choices in the Political arena: Indeed, the plunder has become so common, and the plunderers so smug and self-confident, that their predations are taken for granted, and the thieves themselves treated with extraordinary deference! It is something akin to the Stockholm syndrome. You encounter the same mugger at the same spot every day, and eventually establish a sort of bizarre relationship with him—-even, eventually, thanking him for not taking more. When you are given the opportunity to replace him with another mugger, you vote for the incumbent—sticking with the devil you know, unless his opponent offers to share more of his loot with you.
City of Bell scandal
The City of Bell scandal is a scandal involving misappropriation of public funds in Bell, California over a period of several years in the late 2000s. In July 2010, twoLos Angeles Times reporters, Jeff Gottlieb and Ruben Vives, wrote an investigative journalism article on possible malfeasance in the neighboring city of Maywood, California. In their exposé, they revealed that the city officials of Bell (a small blue collar community) were receiving salaries that were reported as the highest in the nation. Subsequent investigations found atypically high property tax rates, allegations of voter fraud in municipal elections and other irregularities which heightened the ensuing scandal. These and other reports led to widespread criticism and a demand for city officials to resign.
In February 2011, six city officials – Mayor Oscar Hernandez, City Council members Teresa Jacobo and George Mirabal, and former council members Luis Artiga, George Cole and Victor Bello–pled not guilty to misappropriating public funds. In a separate case, former city administrator Robert Rizzo and former city administrator Angela Spaccia were charged with misappropriating public funds, conflict of interest, falsifying public documents, and secreting public documents.Deputy District Attorney Sean Hassett estimates that Rizzo and his assistant allegedly siphoned off more than $6.7 million before the public scandal emerged in the summer of 2010. Prosecutors say the plot came close to bankrupting the small, blue-collar suburb of Los Angeles. Hernandez, who had refused to resign, deputy mayor Teresa Jacobo and former council members Luis Artiga, George Cole, George Mirabel and Victor Bello, also were mandated to keep 100 yards away from City Hall and were forbidden to participate in any of Bell’s civic affairs. The Los Angeles Times reported on October 3, 2013 that ex-Bell City Manager Rizzo pleaded no contest on corruption charges and that he also plans to testify against his former second-in-command, Angela Spaccia. The Los Angeles Times reported on April 9, 2014 that five former political leaders – George Cole, Oscar Hernandez, Teresa Jacobo, Victor Bello and George Mirabal – have agreed to plead no contest to corruption charges and could be sentenced to up to four years in prison for their roles.
On March 9, 2011, city voters overwhelmingly voted to recall Hernandez, Jacobo and Mirabal as well as council member Artiga, who had resigned from the council in 2010. Lorenzo Velez, the lone councilman who was not charged in the Bell corruption case, also lost his seat.
However, that left no majority in the city council to swear in the newly elected council. An emergency action was passed in the state Senate, obtained final approval in the Assembly and was signed by the Governor to empower an alternate to preside at the swearing-in. On April 7, 2011, the bill’s author, California Assemblyman Ricardo Lara (D-Bell Gardens), swore in the entirely new city council.
12 years commuted in 2 to house arrest. A slap on the wrist for betraying public trust.
I would bet my last dollar that he has millions hidden away somewhere…
Notice how the judge inflates a 2.2 million bail to “three million reasons”. Pure theater.
Lytton Casino paves its way towards Doctor’s Medical Center
A lease agreement in May between Doctors Medical Center and the Lytton San Pablo Casino netted the beleaguered hospital $4.6 million. The deal kept the hospital doors open, but was also the beginning of what may become a land grab by local investors.
In the agreement, the casino leased property that overlaps with almost 150 feet of DMC’s land. According to plans submitted to the San Pablo Development Services Department on Sept. 22, the casino intends to tear out the existing parking area, which sits outside the J. C. Robinson, M.D. Regional Cancer Center behind DMC, paving the way for a new 164-car parking lot for the casino’s high rollers.
The easement agreement between DMC and Lytton is a 20-year deal that allows the casino to begin laying the foundation on acquired DMC property. Lytton’s construction plans would beautify the existing parking area in-between the buildings. Four city permits have been issued for the project.
Though DMC has emerged from bankruptcy, the sporadic infusions of cash by the state and local agencies have been unable to stop the financial bleeding while it maintains its operations as a safety net hospital. DMC’s decade long fiscal problems may lead to its closure, shutting down the county’s largest emergency room and sending patients across Contra Costa, Marin and Alameda counties for medical care.
At city hall, San Pablo officials have begun a rezoning effort to take the 2000 Vale Road address, which DMC sits on, and convert the area to a C-1 Light Commercial zone. The “I” zoning facilitates hospitals, post offices, fire stations, schools and parks. The “C-1 Light Commercial” zoning would allow retail and commercial use of the property.
At a recent community meeting at San Pablo’s civic center, city Development Services Manager Michelle Rodriguez presented the city’s plans to the public, including development scenarios that the new zoning could facilitate, like a 100-room hotel, office space or a facility for “indoor recreation,” according to her presentation. But City Manager Matt Rodriguez assured those in attendance that the zone change “will only be triggered if the hospital stops being a hospital.”
DMC was officially put on the market last month with an asking price tag of $30 million. The purchaser will be able to choose to keep the property running as a full functioning hospital or take advantage of the new proposed zoning parameters to create a commercial space or expand on a 164-space parking lot.
In order for a development to occur, there are certain criteria that must be met. The first, an internal environmental review, found that the change from hospital to mixed commercial use would have a “Less-Than-Significant impact” on air quality, noise pollution, and traffic congestion.
The second hurdle is providing an opportunity for the community to submit public comment. But when Michelle Rodriguez facilitated a recent meeting, few attended as the Bay Area was fixated on the final World Series game.
Public Comment Forms, which can be found here, will still be accepted by the City of San Pablo and the Development Services Department, before the planning commission meeting Nov. 18.
The city council will vote on the issue at the council meeting on Dec. 1 determining how the land that DMC sits will be zoned if the hospital is forced to close down.
San Pablo casino might buy Doctors Medical Center