HomeMy WebLinkAbout2015-12-02 Council PacketAGENDA
KENAI CITY COUNCIL – REGULAR MEETING
DECEMBER 2, 2015
*** NEW MEETING TIME – 6:00 P.M. ***
KENAI CITY COUNCIL CHAMBERS
210 FIDALGO AVE., KENAI, AK 99611
http://www.kenai.city
A. CALL TO ORDER
1. Pledge of Allegiance
2. Roll Call
3. Agenda Approval
4. Consent Agenda (Public comment limited to three (3) minutes per speaker;
thirty (30) minutes aggregated)
*All items listed with an asterisk (*) are considered to be routine and non-
controversial by the council and will be approved by one motion. There will be
no separate discussion of these items unless a council member so requests,
in which case the item will be removed from the consent agenda and
considered in its normal sequence on the agenda as part of the General
Orders.
B. SCHEDULED PUBLIC COMMENTS (Public comment limited to ten (10) minutes
per speaker)
1. Charlie Yamada – Resurrection of the Community Bowling Alley.
2. Michelle Drew, BDO USA, LLP. – Fiscal Year 2015 Comprehensive Annual
Financial Report. [Clerk’s Note: 30 minutes requested for this presentation.]
C. UNSCHEDULED PUBLIC COMMENTS (Public comment limited to three (3)
minutes per speaker; thirty (30) minutes aggregated)
D. PUBLIC HEARINGS
1. Ordinance No. 2863-2015 – Amending Kenai Municipal Code Chapter 12.25
– Abandoned Vehicles, to Define Abandoned Vehicles, Amend the Definition
of Junk Vehicles and Make Other Changes Regarding Vehicle Storage, Repair
and Enforcement and Amending Kenai Municipal Code 12.20.030 – Debris and
Junk Prohibited, to Reflect the Title Change to Chapter 12.25. ............... Pg. 5
2. Ordinance No. 2864-2015 – Increasing Estimated Revenues and
Appropriations by $11,991 in the Airport Fund and by $13,000 in the Airport
Improvement Capital Project Fund for the 2016 Airfield Marking & Signage
Project and Authorizing Reappropriation of Remaining Funds from Completed
Projects to the 2016 Airfield Marking & Signage Project. ....................... Pg. 37
Kenai City Council Meeting Page 2 of 3
December 2, 2015
3. Resolution No. 2015-64 – Supporting the Efforts of the Central Area Rural
Transit System (CARTS) to Secure a Grant to Perform a Feasibility Analysis
of Implementing Expanded Transit Services in the Central Peninsula Area.
.............................................................................................................. Pg. 41
4. Resolution No. 2015-65 – Adopting an Alternative Allocation Method for the
FY16 Shared Fisheries Business Tax Program and Certifying that this
Allocation Method Fairly Represents the Distribution of Significant Effects of
Fisheries Business Activity in FMA 14: Cook Inlet.................................. Pg. 53
5. Resolution No. 2015-66 – Awarding an Agreement for Construction of Beaver
Creek Well Field Improvements, Wells 2C And 2E 2015-2016. .............. Pg. 55
6. Resolution No. 2015-67 – Awarding an Agreement for Construction of Vintage
Pointe Heating Control Upgrades.
E. MINUTES
1. *Regular Meeting of November 4, 2015 ................................................... Pg. 59
2. *Work Session Summary of October 27, 2015 ......................................... Pg. 71
F. UNFINISHED BUSINESS – None.
G. NEW BUSINESS
1. *Action/Approval – Bills to be Ratified. ................................................ Pg. 73
2. *Action/Approval – Purchase Orders Exceeding $15,000. ................... Pg. 75
3. *Ordinance No. 2865-2015 – Amending Kenai Municipal Code Section
1.10.040 - Time of Regular Meeting, to Provide Procedures for Establishing,
Canceling and Changing Meeting Dates. ............................................... Pg. 77
4. *Ordinance No. 2866-2015 – Appropriating Transfers for FY2016 Budgeted
Capital Projects in the Terminal Improvements Capital Project Fund and the
Airport Improvements Capital Project Fund............................................ Pg. 81
5. *Ordinance No. 2867-2015 – Increasing (Decreasing) Estimated Revenues
and Appropriation in the Personal Use Fishery Fund and Authorizing
Budgetary Transfers in that Fund for Remaining FY2016 Projected
Expenditures. ......................................................................................... Pg. 85
6. Action/Approval – Mayoral Appointment and Council Confirmation of Council
Liaisons to Committees and Commission. ............................................. Pg. 99
7. Action/Approval – Mayoral Nomination and Council Confirmation of
Appointments to the Planning and Zoning Commission. ..................... Pg. 101
Kenai City Council Meeting Page 3 of 3
December 2, 2015
8. Action/Approval – Providing Direction to the City Attorney and City Clerk to
Draft a Resolution Establishing a Policy for Use of City Email. ........... Pg. 113
H. COMMISSION/COMMITTEE REPORTS
1. Council on Aging
2. Airport Commission
3. Harbor Commission
4. Parks and Recreation Commission ..................................................... Pg. 115
a. Event Park Sub-Committee ..................................................... Pg. 117
5. Planning and Zoning Commission ...................................................... Pg. 119
6. Beautification Committee
7. Mini-Grant Steering Committee
I. REPORT OF THE MAYOR
J. ADMINISTRATION REPORTS
1. City Manager ...................................................................................... Pg. 123
2. City Attorney
3. City Clerk
K. ADDITIONAL PUBLIC COMMENT
1. Citizens Comments (Public comment limited to five (5) minutes per speaker)
2. Council Comments
L. EXECUTIVE SESSION - None
M. PENDING ITEMS – None
N. ADJOURNMENT
****************************************************************************************************
INFORMATION ITEMS
1. Purchase Orders between $2,500 and $15,000 for Council Review.
2. Correspondence from the Kenai Peninsula Food Bank Board of Directors
Regarding Donations.
The agenda and supporting documents are posted on the City’s website at
www.kenai.city. Copies of resolutions and ordinances are available at the City Clerk’s
Office or outside the Council Chamber prior to the meeting. For additional information,
please contact the City Clerk’s Office at 907-283-8231.
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Sponsored by: City Manager
CITY OF KENAI
ORDINANCE NO. 2863-2015
AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AMENDING
KENAI MUNICIPAL CODE CHAPTER 12.25 – ABANDONED VEHICLES, TO DEFINE
ABANDONED VEHICLES, AMEND THE DEFINITION OF JUNK VEHICLES AND MAKE
OTHER CHANGES REGARDING VEHICLE STORAGE, REPAIR AND ENFORCEMENT
AND AMENDING KENAI MUNICIPAL CODE 12.20.030 – DEBRIS AND JUNK
PROHIBITED, TO REFLECT THE TITLE CHANGE TO CHAPTER 12.25.
WHEREAS, the Planning & Zoning Commission requests the City Manager sponsor the
proposed Ordinance; and,
WHEREAS, the City currently prohibits abandoning vehicles on public property and
keeping “Junk Vehicles” for longer than 72 hours except under certain circumstances;
and,
WHEREAS, Kenai Municipal Code does not define “Abandoned Vehicle” which should
be defined for due process and consistency in enforcement; and,
WHEREAS, the Kenai Municipal Code definition for “Junk Vehicle” should be amended
to more clearly define Junk Vehicle; and,
WHEREAS, the Kenai Municipal Code definitions for “Yard, rear”, “Yard, side”, “Lot line,
rear”, “Lot line, side”, and “Lot” should be defined for consistency in enforcement; and,
WHEREAS, Kenai Municipal Code should be amended to provide for a more reasonable
30-day time period rather than a 72-hour time period for the removal of a Junk Vehicle
from any property within the City that is not in an enclosed building or completely
screened from public view or on the premises of a business enterprise being operated in
a lawful place and manner or in an appropriate storage place or depository maintained
lawfully by the City; and,
WHEREAS, the City may improve the health and safety of the community by limiting
the number of Junk Vehicles stored on each parcel and requiring that all Junk Vehicles
be stored in a manner that is not visible from the public view; and,
WHEREAS, reasonably restricting the repair of Junk Vehicles to locations outside of
public rights-of-way and front yards as well as limiting the number of vehicles that may
be worked on at one time will help eliminate attractive nuisances and the impact on
neighborhoods of home repairs; and
WHEREAS, eliminating the code provision that prohibits the removal of junk vehicles
from private property will expand and clarify the City’s available enforcement remedies;
and,
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WHEREAS, other minor amendments to Kenai Municipal Code Chapters 12.20 and
12.25 are needed for housekeeping, administrative and enforcement purposes.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA, that
Section 1. Form: That this is a code ordinance.
Section 2. Amendment of Chapter 12.25 of the Kenai Municipal Code: That Kenai
Municipal Code, Chapter 12.25 – Abandoned Vehicles, is hereby amended
as follows:
Chapter 12.25 ABANDONED AND JUNK VEHICLES
12.25.010 Definitions.
The following definitions shall apply in the interpretation and enforcement of this
chapter:
(a) “Abandoned Vehicle” means a vehicle left unattended on a public street, highway
or other public property for a period in excess of seventy-two (72) hours, unless
otherwise specifically permitted by City ordinance or regulation.
(b) “Junk Vehicle” means a vehicle that exhibits at least two (2) of the following
elements:
(1) Is not currently registered,
(2) Is inoperable because it is missing a major component such as the engine,
transmission, axle, differential, transfer case, front driver seat, or steering
wheel,
(3) The cost of repairs required to make the vehicle operable exceeds the fair
market value of the vehicle,
(4) Missing a windshield or window,
(5) Missing two (2) or more wheels or tires, or has two (2) or more flat tires,
(6) Missing a major body part, such as a fender, quarter panel, bumper,
trunk lid, door or hood.
(c)[A] “Person” [SHALL] means any person, firm, partnership, association, corporation,
company, or organization of any kind.
(d)[B] “Vehicle” [SHALL] means a machine propelled by power other than human power
designed to travel along the ground by use of wheels, treads, runners, or slides,
and transport persons or property or pull machinery and shall include, without
limitation, automobile, truck, trailer, motorcycle, tractor, buggy, and wagon.
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(e)[C] “Street or highway” [SHALL] means the entire width between the boundary lines
of every way publicly maintained when any part thereof is open to the use of the
public for the purposes of vehicular travel.
(f)[D] “Property” [SHALL] means any real property within the City which is not a street
or highway.
(g) “Yard, Rear” means a yard extending across the full width of the lot between the
most rear main building and the rear lot line.
(h) “Yard, Side” means a yard on each side of a main building and extending from
the front lot line to the rear lot line. The width of the required side yard shall be
measured horizontally from the nearest point of a side lot line to the nearest part
of the main building.
(i) “Lot Line, Rear” means a line that is opposite and most distant from the front lot
line, and in the case of irregular, triangular, or gore shaped lot, a line not less
than ten fee (10’) in length, within a lot, parallel to and at the maximum distance
from the front lot line.
(j) “Lot Line, Side” means any lot boundary line not a front lot line or a rear lot line.
(k) “Lot” means a parcel of land occupied or to be occupied by a principal use and
having frontage on a public street.
12.25.020 Abandonment of [v ]Vehicles.
No person shall [ABANDON ANY] leave an abandoned vehicle within the City. [AND NO
PERSON SHALL LEAVE ANY VEHICLE AT ANY PLACE WITHIN THE CITY FOR SUCH
TIME AND UNDER SUCH CIRCUMSTANCES AS TO CAUSE SUCH VEHICLE
REASONABLY TO APPEAR TO HAVE BEEN ABANDONED.]
12.25.030 Leaving of [j]Junk or [i]Illegally [p]Parked [v]Vehicles.
(a) No person shall leave any [j]Junk [v]Vehicle on any street, highway, or public
property within the City.
(b) No person shall leave any vehicle remaining on public property designated for
parking in violation of regulations, ordinances, and/or posted times, periods, or
conditions. Any such vehicle shall be subject to emergency impounding
procedures pursuant to Kenai Municipal Code 12.25.040(c).
(c) No person in charge or control of any property within the City, whether as owner,
tenant, occupant, lessee, or otherwise, shall allow any [j[Junk [v]Vehicle to
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remain on such property longer than thirty (30) days[SEVENTY-TWO (72)
HOURS]; and no person shall leave any such vehicle on any property within the
City for a longer time than thirty (30) days[SEVENTY-TWO (72) HOURS]; except
that this Chapter [ORDINANCE] shall not apply with regard to a vehicle in an
enclosed building or completely screened from public view and adjacent
properties in compliance with Kenai Municipal Code 12.25.040; a vehicle on the
premises of a business enterprise operated in a lawful place and manner, when
necessary to the operation of such business enterprise; [OR] a vehicle in an
appropriate storage place or depository maintained in a lawful place and manner
by the City; or Junk Vehicles stored lawfully on parcels zoned: Light Industrial
(IL) or Heavy Industrial (IH).
[(D) NOTWITHSTANDING KMC 12.25.030(C), NO VEHICLE MAY BE REMOVED
FROM PRIVATE PROPERTY WITHOUT THE CONSENT OF THE PROPERTY
OWNER OR OCCUPANT.]
(d)[E] Notwithstanding the provisions of subsection (c) of this section, if the City Manager
or designee has reasonable grounds to believe that repairs can be made to render
a [j]Junk [v]Vehicle operable, that the registered owner or other person entitled
to possession of the vehicle is willing to undertake or have performed such
repairs, that the vehicle does not pose any health or safety hazard, and that there
is no reasonable means for removing the vehicle from public view while repairs
are being performed, the City Manager may authorize a period of no more than
thirty (30) additional days for the performance of such repairs.
In no case, however, may this section be construed as authorizing the operation
of a junkyard or other salvage or repair business where other requirements of the
law have not been met.
[(F) “JUNK VEHICLE” MEANS A MOTOR VEHICLE THAT IS:
(1) IN A CONDITION WHICH EXHIBITS TWO (2) OF THE FOLLOWING
ELEMENTS:
(I) A SUBSTANTIAL AMOUNT OF BROKEN OR MISSING GLASS,
(II) MISSING TWO (2) OR MORE WHEELS OR TIRES,
(III) MISSING A BODY PANEL OR BODY PART, SUCH AS QUARTER
PANELS, BUMPER, TRUNK LID OR HOOD,
(IV) MISSING AN ESSENTIAL COMPONENT SUCH AS THE ENGINE,
TRANSMISSION, CARBURETOR, DISTRIBUTOR, BRAKE OR
WHEEL CYLINDER, BRAKE SHOE, GENERATOR, OR
ALTERNATOR, STARTER, FRONT PASSENGER SEAT, OR DRIVE
SHAFT; OR
(2) STRIPPED, WRECKED OR OTHERWISE INOPERABLE DUE TO
MECHANICAL FAILURE; OR
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(3) HAS NOT BEEN REPAIRED BECAUSE OF MECHANICAL DIFFICULTIES
OR BECAUSE THE COST OF REPAIRS REQUIRED TO MAKE IT
OPERABLE EXCEEDS THE FAIR MARKET VALUE OF THE VEHICLE.]
12.25.040 Storage of Junk Vehicles.
Junk Vehicles must be stored in a back yard or side yard subject to the following
restrictions:
(1) Two-thousand square feet of yard area is required per vehicle, up to a maximum
of four vehicles per parcel stored outside.
(2) Any stored Junk Vehicle must be covered with a car cover designed for covering
vehicles.
(3) Junk Vehicles may only be stored on a property that has an existing structure
consistent with a principal permitted use.
12.25.050 Repair of Junk Vehicles.
Junk vehicles may only be repaired subject to the following restrictions:
(1) Junk Vehicle repair shall take place within an enclosed structure or in a side or
back yard.
(2) Repair work may not be conducted on more than one junk vehicle at a time
unless within an enclosed structure.
(3) Parts, equipment, and supplies must be stored in an area that is screened from
public view.
(4) Junk Vehicle repair is not allowed within the public right-of-way.
12.25.0[4]60 Impounding of Vehicles and Junk and Abandoned Vehicles.
(a) The [CHIEF OF POLICE] City Manager or [ANY MEMBER OF HIS OR HER
DEPARTMENT DESIGNATED BY HIM OR HER] designee is hereby authorized to
remove or have removed any vehicle left at any place within the City which
reasonably appears to be in violation of any regulation or ordinance or lost,
stolen, or unclaimed. Such vehicle shall be impounded until lawfully claimed or
disposed of in accordance with this chapter.
(b) Where an abandoned, junk, wrecked, non-operating, illegally parked or discarded
vehicle presents no obstruction or hazard and is properly registered and licensed,
so that the owner or other interested persons can be notified, the [CHIEF OF
POLICE] City Manager, or designee shall give notice by personal service or
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certified mail with return receipt requested to the owner and/or interested person
stating:
(1) A description of the vehicle;
(2) The violation or reason for police action;
(3) The proposed action to be taken;
(4) The right of the person notified to a hearing with, and an opportunity to
be heard by the [CHIEF OF POLICE] City Manager or designee in order
that the proposed action or amount due may be contested;
(5) That said vehicle will be towed, impounded, and/or disposed of if
unclaimed for a period of thirty (30) days after notice is sent.
(c) Where an abandoned, junk, wrecked, non-operating, illegally parked, or
discarded vehicle presents an obstruction or hazard, or an emergency exists, and
said vehicle is impounded or towed, notice of the type, and to the extent, set forth
in KMC 12.25.0[4]60 shall be given as soon as practical after towing or impound.
(d) Where the owner or other interested person cannot be readily ascertained, notice
by publication shall be given subsequent to towing or impound and prior to sale
or other disposal.
[(E) THE CHIEF OF POLICE SHALL KEEP A RECORD OF ALL VEHICLES
IMPOUNDED, CONTAINING DATE OF IMPOUNDING, DESCRIPTION OF
VEHICLE AND CONTENTS THEREIN, CAUSE FOR WHICH IMPOUNDED, AND
OTHER INFORMATION DEEMED PERTINENT.]
12.25.0[5]70 Redemption of [i]Impounded [v]Vehicles.
(a) After a vehicle has been impounded as provided by regulation or ordinance and
the owner or authorized representative of the owner of the vehicle claims the
same, he or she shall be informed of the nature and circumstances causing the
impoundment of such vehicle. He or she shall [AND TO] obtain a release thereof
and shall pay all towing and storage fees unless pursuant to KMC 12.25.0[4]60
it is administratively determined that the action taken was unwarranted, in
which case the vehicle shall be released immediately to the owner without
collection of fees or other charges.
(b) If the operator or owner of the vehicle, upon hearing before a magistrate and or
judge in a court of law, is found not guilty of the violation of which he or she is
charged, the impounded vehicle shall be released immediately to the owner
without collection of fees or other charges. If the owner or operator of such vehicle
is found guilty by the magistrate and or judge in a court of law, any fine imposed
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under the provisions of the appropriate section of this title shall be in addition to
the towing and storage charges herein prescribed.
(c) A vehicle is declared to be impounded when an authorized person, pursuant to
and under authority of this title, requests dispatch of a tow truck to effect the
impoundment. A person whose vehicle has been impounded may obtain the
release of the impounded vehicle, if towing has not commenced, by paying the
tow contractor the tariff or contract rate as provided for canceled trips, provided
that such impoundment is one where the owner is entitled to release of the
vehicle. This section has no effect on a citation, ticket, or complaint that may be
issued in connection with the impoundment.
12.25.0[6]80 Disposition—Destruction.
(a) If the [CHIEF OF POLICE] City Manager or designee determines that an
abandoned vehicle impounded pursuant to this chapter has been scrapped,
dismantled, or destroyed beyond repair as provided in [AS 28.10.221(A)(2), AND
AS 28.10.051(A)(3)] applicable state law or if he or she determines that because
of the age and condition of the vehicle it is no longer of significant value, he or
she may dispose of it by crushing or other means of destruction upon the
expiration of the thirty (30) day period required by KMC 12.25.0[4]60.
(b) The City may also dispose of [j]Junk [v]Vehicles at the written request of the
registered owner of the vehicle or person in lawful possession or control of the
vehicle. This written request shall be on a form prescribed by the City.
12.25.0[7]90 Sale of [i]Impounded [v]Vehicles.
When a vehicle has been impounded for violations of this title, the [CHIEF OF POLICE]
City Manager or designee or designated agent shall send a notice by certified mail to
both the legal and registered owner of the vehicle, if different persons, when the name
of the owner or owners can be ascertained by checking the records of the Alaska
Department of Public Safety.
The notice shall accurately describe the vehicle and any property therein, give the date
the vehicle was impounded and state that unless the vehicle is reclaimed within thirty
(30) days from the date of the notice, it will be disposed of pursuant to State law.
12.25.[08]100 Waiver of [c]Claims for [d]Damages.
An owner of an abandoned, discarded or illegally parked vehicle, waives any claims he
or she may have for damage to his or her vehicle which may result from actions taken
pursuant to this chapter. Such damage includes, but is not limited to, accidental
damage or destruction occasioned by removal, transport, storage, and acts of third
parties.
12.25.[09]110 Penalty.
A person who violates KMC 12.25.020 or 12.25.030 is subject to a fine as provided for
violations in KMC 13.05.010.
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Section 3. Amendment of Section 12.20.030 of the Kenai Municipal Code: That Kenai
Municipal Code, Chapter 12.20.030 – Debris and Junk Prohibited, is
hereby amended as follows:
12.20.030 Debris and junk prohibited.
(a) The owner and the occupant of any private property in the City shall at all times
maintain the premises free from significant accumulations of junk, garbage or
litter that a reasonable person would find offensive. This section shall not prohibit
the storage of junk or litter in authorized private receptacles for collection. A
significant accumulation of junk or litter on any private property in the City
contrary to this section is deemed to be a public nuisance.
(b) No owner, lessee, agent tenant or occupant shall allow or permit slash to be or
remain upon any lot: (1) for longer than one hundred twenty (120) days within
the RU, RS-1, RS-2, TSH, CC or CG zones; or (2) for longer than one hundred
twenty (120) days on lots smaller than forty thousand (40,000) square feet within
the C, RR, RS, IL, IH, R or ED zones.
(c) Nothing in this chapter shall be construed to limit the lawful operation of a
junkyard or storage yard. This section does not amend, alter or modify the
provisions of KMC 12.25 (Abandoned and Junk Vehicles).
As used in this chapter, the following words are defined in this section:
“Garbage” means all putrescible wastes, except sewage and body waste, including food
wastes resulting from the handling, preparation, cooking, or consumption of food or the
cans, containers, wrappers, or other tangible items wasted or used along with such
materials.
“Junk” means any worn-out, wrecked, scrapped, partially or fully dismantled or
discarded tangible material, combination of materials or items that cannot without
further alteration and reconditioning be used for their original purposes, including but
not limited to appliances, building material, chemicals, equipment, furniture,
machinery, metal, rags, rubber, paper, used tires, plastics and wood. Stacked firewood
or building materials stored for future use shall not constitute “junk.”
“Litter” means all improperly discarded waste material, including, but not limited to,
convenience food, beverage and other product packages or containers constructed of
steel, aluminum, glass, paper, plastic and other natural and synthetic material, thrown
or deposited on the lands and waters within the boundaries of the City.
“Occupant” means the person in possession of the real property on which the junk or
litter is located. “Occupant” includes tenant and lessee.
“Owner” means the owner of the real property on which the junk or litter is located, or
the agent of the owner.
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“Slash” is defined as branches and other residue left after the felling of timber. Tree
trunks trimmed free of roots and branches or cut firewood stacked and separated from
branches and other residue of tree cutting shall not constitute “slash.”
Section 4. Severability: That if any part or provision of this ordinance or application
thereof to any person or circumstances is adjudged invalid by any court of
competent jurisdiction, such judgment shall be confined in its operation
to the part, provision, or application directly involved in all controversy in
which this judgment shall have been rendered, and shall not affect or
impair the validity of the remainder of this title or application thereof to
other persons or circumstances. The City Council hereby declares that it
would have enacted the remainder of this ordinance even without such
part, provision, or application.
Section 5. Effective Date: That pursuant to KMC 1.15.070(f), this ordinance shall
take effect 30 days after adoption.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 2nd day of
December, 2015.
______________________________________
PAT PORTER, MAYOR
ATTEST:
___________________________________
Sandra Modigh, City Clerk
Introduced: November 4, 2015
Adopted: December 2, 2015
Effective: January 2, 2015
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Feasibility Study of Enhanced Transit Options for the
Central Peninsula (Kenai/Soldotna) Area
PROJECT SCOPING ONLY - DRAFT NARRATIVE
PROJECT PURPOSE
Central Area Rural Transit System (CARTS) formally request funding in the amount of $75,000 from the
Alaska Mental Health Trust Fund to obtain professional services for a feasibility analysis of improved
transit alternatives for the central Kenai Peninsula area. The study is intended to build on previous
work done as part of the Public Transit – Human Services Community Coordinated Plan (LSC
Transportation Consultants, 2010), and further explore the feasibility of implementing a fixed-point or
deviated-route system between and within the communities of Kenai and Soldotna. The feasibility
study would update data and assumptions used in the 2010 process, provide an analysis of estimated
costs as part of an updated service plan, and outline implementation actions to guide next steps.
CARTS would be the recipient of the grant funds and lead agency for administering the project,
however this planning effort is intended to be a partnership and joint effort between CARTS, the local
governments, and interested stakeholders in the community.
The estimated project budget to obtain professional services for the transit plan update and associated
public input process is $75,000. Twenty percent of this amount is anticipated as matching requests
from the Cities of Kenai and Soldotna, and from the Kenai Peninsula Borough.
BACKGROUND
The 2010 planning process evaluated transit systems for the entire Kenai Peninsula Borough, and
recommended a gradual transition toward a fixed-point or deviated route system between the cities of
Kenai and Soldotna. The plan notes that this would represent a significant departure from the current
demand-response delivery model, and as such, would require strong partnerships between different
agencies in the area. In the five years since the plan was completed, there has not been a coordinated
effort to move forward on the recommendations. There remains, however, significant interest from
key individuals representing various community organizations to see enhanced transit options in our
area.
A group of community members with interest in local transit have been meeting recently to build
relationships, and coordinate efforts related to furthering the goals of the 2010 plan. So far these
meetings have been informal, but participants share a common vision of working toward enhanced
transit opportunities in our area, and are willing to coordinate resources and talent in order to do so.
Organizations currently represented in the stakeholder group include: the governments of the Kenai
Peninsula Borough, City of Soldotna, City of Kenai, CARTS, Central Peninsula Hospital (Serenity
House), Frontier Community Services, Ninilchik Traditional Council, Peninsula Community Health
Services, [others?].
PROJECT SCOPE
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A significant amount of work has already been done as part of the 2010 public input process, and by a
group of professionals at LSC Transportation Consultants who prepared the final planning document.
This current effort intends to build on that body of work and core recommendations from the 2010
plan, and provide further detail into the feasibility of implementing a new transit plan for our area.
It is anticipated that the consultant selected for this project would include a multi-disciplinary team of
professionals, with expertise in public transit and social services, budgeting and cost estimates for both
start-up and ongoing operations of a modified transit systems, and familiarity with our area’s
demographics and needs. The consultant would also need experience and skill in facilitating public
planning processes with a diverse group of stakeholders.
Key tasks/deliverables include:
- Updating existing conditions data, including: community conditions; existing transportation
resources; and a transit needs assessment;
- Elaborating on the costs and benefits of implementing various service options in our area, and
verify whether a fixed-point or deviated route system in the Kenai/Soldotna area remains the
recommended option to address area needs and gaps in transportation;
- Providing an updated and more specific transit service plan for the central peninsula, to include:
detailed cost estimates (both up-front and ongoing operating costs); estimates of ridership;
locations and timing of routes; fare structure and revenue estimates;
- Identifying possible funding sources to assist with implementation and ongoing operations; and
- Preparing a detailed implementation plan to outline necessary steps in transitioning toward the
new transit service plan;
The Consultant shall gather all necessary data, coordinate and conduct public input process, prepare
draft documents for advisory committee review, and prepare a final report representing the finished
product of the analysis and group input.
PLANNING PROCESS
CARTS would be the lead agency for the grant, and would provide a significant amount of data related
to existing operations and services provided in our area. Matching funds would be requested from the
Cities of Kenai and Soldotna, and from the Kenai Peninsula Borough. These agencies may also provide
in-kind assistance throughout the planning process related to meeting space, public involvement, and
general planning assistance.
A committee comprised of representatives from stakeholder organizations would be formalized and
tasked with overseeing the project and providing input and key decisions as the study progresses. The
intent is that while CARTS is the lead agency and currently the public transit provider for our area, the
issue of transportation is one that affects our community as a whole. Input and buy-in from partner
organizations is crucial to having an area plan that can be implemented.
The project team does not anticipate a significant amount of ‘visioning’ associated with the tasks
outlined above, however public input may be critical at key points throughout the project. The
Consultant shall work to incorporate meaningful public input and opportunities for feedback, in
addition to those provided by the advisory committee, as needed.
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KENAI CITY COUNCIL – REGULAR MEETING
NOVEMBER 4, 2015 – 6:00 P.M.
KENAI CITY COUNCIL CHAMBERS
210 FIDALGO AVE., KENAI, AK 99611
VICE MAYOR BRIAN GABRIEL, PRESIDING
MINUTES
A. CALL TO ORDER
A Regular Meeting of the Kenai City Council was held on November 4, 2015, in City Hall
Council Chambers, Kenai, AK. Vice Mayor Brian Gabriel called the meeting to order at 6:00
p.m.
1. Pledge of Allegiance
Vice Mayor Gabriel led those assembled in the Pledge of Allegiance.
2. Roll Call
There were present:
Pat Porter, Mayor (telephonic) Henry Knackstedt
Robert Molloy Brian Gabriel, Vice Mayor
Terry Bookey (absent) Mike Boyle
Tim Navarre
A quorum was present.
Also in attendance were:
**Hannah Drury, Student Representative
Rick Koch, City Manager
Scott Bloom, City Attorney
Sandra Modigh, City Clerk
Jamie Heinz, Deputy Clerk
3. Agenda Approval
Vice Mayor Gabriel noted the following requested revisions/additions to the agenda/packet:
Add to New G.8
Business Item Action/Approval – Travel on behalf of the City for Vice Mayor
Gabriel and Councilor Navarre to attend the Legends & Medallion
Foundation Banquet in Anchorage on November 6th.
Add to New G.9
Business Item Action/Approval – Travel on behalf of the City for Vice Mayor
Gabriel to attend the Alaska Board of Fisheries meeting in
Anchorage on December 2-8.
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Add to Item D. 2
Ordinance No. 2860-2015
• Substitute Ordinance
MOTION:
Council Member Molloy MOVED to approve the agenda with requested revisions and requested
UNANIMOUS CONSENT. Council Member Knackstedt SECONDED the motion.
VOTE: There being no objections, SO ORDERED.
4. Consent Agenda
MOTION:
Councilor Knackstedt MOVED to approve the consent agenda; Council Member Molloy
SECONDED the motion and requested UNANIMOUS CONSENT.
Mayor Porter opened public comment for items on the consent agenda; there being no one
wishing to be heard, the public comment was closed.
VOTE: There being no objections, SO ORDERED.
*All items listed with an asterisk (*) are considered to be routine and non-
controversial by the council and will be approved by one motion. There will be no
separate discussion of these items unless a council member so requests, in which
case the item will be removed from the consent agenda and considered in its normal
sequence on the agenda as part of the General Orders.
B. SCHEDULED PUBLIC COMMENTS
1. Morgan Merritt, State of Alaska Department of Transportation – Project to Replace
Two Culverts in Kenai.
Morgan Merritt spoke about two culverts that needed replacing. One near Wal-Mart needed
upgraded to provide for better fish habitat. Mr. Merritt noted that the Department of
Transportation (DOT) would be changing the traffic pattern to two lanes through construction
and that they planned on the improvements being completed in one construction season so that
they didn’t have to cut through the pavement at a later time. The other project Mr. Merritt
discussed was near Leif Hansen Park where DOT planned to line & straighten the vault; he
noted that this project was not a fish habitat.
C. UNSCHEDULED PUBLIC COMMENTS - None
D. PUBLIC HEARINGS
1. Ordinance No. 2859-2015 – Increasing Estimated Revenues and Appropriations by
$20,000 in the Senior Center Fund for Remodel of the Facilities Restrooms.
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MOTION:
Councilor Molloy MOVED to enact Ordinance No. 2859-2015; the motion was SECONDED by
Council Member Knackstedt.
Vice Mayor Gabriel opened the public hearing; there being no one wishing to be heard, the
public hearing was closed.
VOTE:
YEA: Porter, Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
2. Ordinance No. 2860-2015 – Increasing Estimated Revenues and Appropriations by
$1,878,800 in the Water and Sewer Capital Project Construction of a New Water
Reservoir and Related Piping/Equipment.
MOTION:
Councilor Navarre MOVED to enact Ordinance No. 2860-2015; the motion was SECONDED by
Council Member Molloy.
Vice Mayor Gabriel opened the public hearing; there being no one wishing to be heard, the
public hearing was closed.
MOTION TO AMEND:
Councilor Molloy MOVED to amend by substitute Ordinance No, 2860-2015; the motion was
SECONDED by Council Member Knackstedt. UNANIMOUS CONSENT was requested.
It was explained that the timeline change required a new grant; it was further explained that the
Beaver Loop project would come later.
VOTE ON THE AMENDMENT: There being no objections, SO ORDERED.
VOTE ON THE MAIN MOTION:
YEA: Porter, Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
3. Ordinance No. 2861-2015 – Accepting and Appropriating a Donation from the Hilcorp
Energy Company to Assist with the Annual Kenai Senior Center Thanksgiving Dinner.
MOTION:
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Councilor Molloy MOVED to enact Ordinance No. 2861-2015; the motion was SECONDED by
Council Member Knackstedt.
Vice Mayor Gabriel opened the public hearing; there being no one wishing to be heard, the
public hearing was closed.
Gratitude was expressed for Hilcorp’s generous donation.
VOTE:
YEA: Porter, Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
4. Ordinance No. 2862-2015 – Accepting and Appropriating a Grant from the Association
for Library Service to Children for a Curiosity Creates Grant.
MOTION:
Councilor Knackstedt MOVED to enact Ordinance No. 2862-2015; the motion was SECONDED
by Council Member Molloy.
Vice Mayor Gabriel opened the public hearing; there being no one wishing to be heard, the
public hearing was closed.
VOTE:
YEA: Porter, Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
E. MINUTES
1.*Regular Meeting of October 21, 2015
Minutes were approved by the consent agenda.
2.*Work Session Summary of October 27, 2015
Minutes were approved by the consent agenda.
F. UNFINISHED BUSINESS
1. Action/Approval – Cancelation of the November 18, 2015, City Council meeting
Pursuant Charter.
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[Clerk’s Note: At its meeting on October 21, 2015, Council postponed this item to the following
meeting. A motion to approve is on the floor.]
It was noted that the meeting could be rescheduled rather than cancelled; Administration
explained that nothing was time sensitive prior to December 2. It was also noted that
cancellation eliminated confusion and hardships to the public.
VOTE:
YEA: Porter, Knackstedt, Navarre, Gabriel
NAY: Boyle, Molloy
**Student Representative Drury: YEA
MOTION PASSED.
G. NEW BUSINESS
1. *Action/Approval – Bills to be Ratified.
Approved by the consent agenda.
2. *Action/Approval – Purchase Orders Exceeding $15,000.
Approved by the consent agenda.
3. *Ordinance No. 2863-2015 – Amending Kenai Municipal Code Chapter 12.25 –
Abandoned Vehicles, to Define Abandoned Vehicles, Amend the Definition of Junk
Vehicles and Make Other Changes Regarding Vehicle Storage, Repair and
Enforcement and Amending Kenai Municipal Code 12.20.030 – Debris and Junk
Prohibited, to Reflect the Title Change to Chapter 12.25.
Introduced on the consent agenda and public hearing set on December 2, 2015.
4. *Ordinance No. 2864-2015 – Increasing Estimated Revenues and Appropriations by
$11,991 in the Airport Fund and by $13,000 in the Airport Improvement Capital
Project Fund for the 2016 Airfield Marking & Signage Project and Authorizing
Reappropriation of Remaining Funds from Completed Projects to the 2016 Airfield
Marking & Signage Project.
Introduced on the consent agenda and public hearing set on December 2, 2015.
5. Action/Approval – Consenting to the Acceptance of Certain Rights-of-Way for
Jaynes Subdivision Big Mikes Addition.
Council Member Molloy noted conflict of interest; business partner was involved in the
transaction.
Vice Mayor Gabriel ruled Molloy was to be excused from voting.
MOTION:
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Councilor Knackstedt MOVED to accept the certain rights-of-way for Jaynes Subdivision Big
Mikes Addition. The motion was SECONDED by Council Member Navarre.
VOTE:
YEA: Porter, Knackstedt, Navarre, Gabriel, Boyle,
NAY:
EXCUSED: Molloy
**Student Representative Drury: YEA
MOTION PASSED.
6. Action/Approval – Providing a Status Report on the Rock Dedication Event Being
Held to Recognize the Charter Commission of 1963.
Administration reviewed the memo provided in the packet explaining the plan to transfer funds
from the Non-Departmental Contingency account to cover the costs unless there was objection.
There was no objection.
MOTION:
Councilor Navarre MOVED that the Council support the Charter Commission Memorial. The
motion was SECONDED by Mayor Porter.
VOTE:
YEA: Porter, Knackstedt, Navarre, Gabriel, Boyle, Molloy
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
7. Discussion – Options to Sell, Lease or Offer for Management Services of the
Bowling Alley.
It was explained that the City’s options were to sell or lease the building and the property.
Administration explained the intent to draft a request for proposals providing for parties to
propose to either lease or purchase, or some combination thereof from the City.
There was general discussion about the condition of the building; specifically the heating
system. It was noted that inspections would likely be done by parties submitting proposals and
would be used as a negotiation point.
Administration explained that the lease was expired, proper notices had been given to all
interested parties and the proper documentation would be recorded. It was also explained that
an outstanding issue could be borough taxes, which may prevent a clear title.
It was noted that all proposals could be rejected.
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8. Action/Approval – Travel on behalf of the City for Vice Mayor Gabriel and Councilor
Navarre to attend the Legends & Medallion Foundation Banquet in Anchorage on
November 6th.
[Clerk’s Note: This item was added at approval of the agenda.]
MOTION:
Mayor Porter MOVED to approve the travel. The motion was SECONDED by Council Member
Knackstedt.
It was explained that the costs of airline, banquet and per diem likely amounted to $600 per
person and that funds were available because there was no one attending Newly Elected
Official Training during the Alaska Municipal League Conference. It was pointed out that Kenai
resident Mr. Bielefeld, who had examined over 400 pilots and had been a leaseholder at the
airport since 1961, was being recognized. Explanation was provided that the Mayor asked the
Vice Mayor to attend on her behalf since she is out of town. It was further explained that
Council Member Navarre was Council’s liaison to the Airport Commission. It was noted that
Council Member Navarre was already in Anchorage on other business and his attendance
would not cost the City.
VOTE:
YEA: Porter, Knackstedt, Navarre, Gabriel, Boyle, Molloy
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
9. Action/Approval – Travel on behalf of the City for Vice Mayor Gabriel to attend the
Alaska Board of Fisheries meeting in Anchorage December 2-8.
[Clerk’s Note: This item was added at approval of the agenda.]
It was pointed out that Vice Mayor Gabriel would not be in Anchorage for the whole meeting,
only the time that the Board reconsiders the 2017 finfish meeting location and at most,
expenses would be airfare, two days of hotel and per diem.
MOTION:
Councilor Molloy MOVED to approve Vice Mayor Gabriel’s travel to attend the Alaska Board of
Fisheries meeting in Anchorage sometime between December 2-8. The motion was
SECONDED by Council Member Boyle.
Council thanked Gabriel for attending the meeting on behalf of the City.
It was noted the City needed to be a part of the solution on important issues that involve
revenue sharing and other matters.
VOTE:
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YEA: Porter, Knackstedt, Navarre, Gabriel, Boyle, Molloy
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
H. COMMISSION/COMMITTEE REPORTS
1. Council on Aging – no report; next meeting December 10.
2. Airport Commission – next meeting on November 12.
3. Harbor Commission – no report; next meeting December 9.
4. Parks and Recreation Commission – no report; next meeting November 5.
a. Event Park Sub-Committee – no report; next meeting November 10.
5. Planning and Zoning Commission – It was reported that the Commission had met in
several work sessions regarding commercial legalization of marijuana, a draft
ordinance had been prepared and the Commission would be holding a public
hearing on the draft ordinance on November 10. It was also reported that the
Commission set a work session for December 9 to review the proposed abandoned
mobile home ordinance, and a joint work session of the Airport Commission and the
Planning and Zoning Commission was taking place November 12 to discuss rezone
of airport property.
6. Beautification Committee – no report; next meeting January 12.
7. Mini-Grant Steering Committee – No report.
I. REPORT OF THE MAYOR
Vice Mayor Gabriel reported on the following:
• As acting mayor attended Kenai Visitor Center member appreciation night
• Attended Robin Adams retirement party; expressed gratitude for Robin’s years
of service to City.
• Thanked the Council for approval of upcoming travel.
J. ADMINISTRATION REPORTS
1. City Manager reported on the following:
• The Kenai Peninsula Alaska Department of Fish & Game (ADF&G) Advisory
Committee passed resolution to hold the 2017 Alaska Board of Fisheries
finfish meeting on the Kenai Peninsula.
• Had an opportunity to lobby the Anchorage ADF&G Advisory Committee
which voted in favor of sending a letter of support for the location change to
the Kenai Peninsula for the 2017 Alaska Board of Fisheries meeting
regarding finfish.
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• Would be on the KSRM’s radio program “Sound Off” with Vice Mayor Gabriel
to discuss the importance for residents to send an email to the Board of
Fisheries encouraging the Board to meet on the Peninsula in 2017 when
considering changes to the finfish regulations.
2. City Attorney – none.
3. City Clerk – reported that the Board of Adjustment would meet on December 8 at
6:00 P.M. regarding a Conditional Use Permit for an emotional support horse.
K. ADDITIONAL PUBLIC COMMENT
1. Citizens Comments (Public comment limited to five (5) minutes per speaker)
Charlie Yamada spoke in favor of keeping the former bowling alley an indoor recreation space.
She also noted that she had been approached about keeping a bowling alley in Kenai as it
could be a wintertime destination for bowling tournaments. She explained that she had
researched what it meant to lease an airport property; discovered it meant keeping the airport
self-sustaining.
2. Council Comments
Council Member Molloy spoke in favor of making MP-3’s available of committee and
commission meetings. Also inquired into the management of closing off access at Dunes Road
after the new access road to South Beach was built.
Student Representative Drury reported the Kenai was hosting the region volleyball tournament
starting tomorrow. She noted it was possible the Kardinals could make it to the state
tournament.
Councilor Knackstedt praised administration for the work on the dipnet report; noted it was easy
when good data was available. He also praised the departments and the IT Director for their
work during the dipnet fishery opening.
Vice Chair Gabriel thanked staff for providing the zip code data to the person requesting the
information.
Council Member Navarre wished everyone a Happy Thanksgiving since the November 18
meeting had been cancelled.
L. EXECUTIVE SESSION
1. Discussion of Delinquent Lease Payments for the Bowling Alley, a Matter of which
the Immediate Knowledge would Clearly have an Adverse Effect Upon the Finances
of the City [AS 44.62.310(c)(1)].
MOTION:
Councilor Molloy MOVED to convene into executive session for Discussion of Delinquent Lease
Payments for the Bowling Alley, a Matter of which the Immediate Knowledge would Clearly have
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an Adverse Effect Upon the Finances of the City [AS 44.62.310(c)(1)],; the motion was
SECONDED by Council Member Boyle.
The City Attorney, City Manager, and Finance Director were invited to the Executive Session.
VOTE:
YEA: Porter, Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
**Student Representative Drury: YEA
MOTION PASSED UNANIMOUSLY.
The City Council reconvened in open session.
It was stated that Council met in executive session to discuss delinquent lease payments for the
bowling alley and no direction was given.
2. Discussion of the Grant Aviation Terminal Lease, a Matter of which the Immediate
Knowledge would Clearly have an Adverse Effect Upon the Finances of the City [AS
44.62.310(c)(1)].
MOTION:
Councilor Molloy MOVED to enter into executive session for Discussion of the Grant Aviation
Terminal Lease, a Matter of which the Immediate Knowledge would Clearly have an Adverse
Effect Upon the Finances of the City [AS 44.62.310(c)(1)],; the motion was SECONDED by
Council Member Knackstedt.
The City Attorney, City Manager, and Finance Director were invited to the Executive Session.
VOTE:
YEA: Knackstedt, Molloy, Navarre, Gabriel, Boyle
NAY:
MOTION PASSED UNANIMOUSLY.
The City Council reconvened in open session.
It was stated that Council met in executive session to discuss the terminal lease for Grant
Aviation and no direction was given.
M. PENDING ITEMS – None.
N. ADJOURNMENT
There being no further business before the Council, the meeting was adjourned at 8:45 p.m.
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I certify the above represents accurate minutes of the Kenai City Council meeting of November
4, 2015.
_____________________________
Sandra Modigh, CMC
City Clerk
**The student representative may cast advisory votes on all matters except those subject to
executive session discussion. Advisory votes shall be cast in the rotation of the official council
vote and shall not affect the outcome of the official council vote. Advisory votes shall be
recorded in the minutes. A student representative may not move or second items during a
council meeting.
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KENAI CITY COUNCIL WORK SESSION
2015 DIP NET REPORT
OCTOBER 27, 2015 – 6:00 P.M.
KENAI CITY COUNCIL CHAMBERS
VICE MAYOR GABRIEL, PRESIDING
NOTES
Council present: R. Molloy, M. Boyle, B. Gabriel, H. Knackstedt
Others present: City Manager R. Koch, City Attorney S. Bloom, City Clerk S. Modigh,
Finance Director T. Eubank, Police Chief G. Sandahl, IT Manager D.
Castimore, P&R Director B. Frates, and Public Works Director S.
Wedemeyer
Vice Mayor Gabriel began the work session at approximately 6:00 p.m.
City Manager Koch provided an overview of the 2015 Dip Net Report noting that the only
operational change implemented for 2015 was relocating fee shacks to eliminate issues from
the previous year; the changes were successful. Koch noted that no wake zones implemented
in 2014 have continued to work extremely well.
Koch advised that the entrance to the south shore via Old Cannery Road was again closed
through a temporary section-line access closure permit issued to the City by the Alaska
Department of Natural Resources. It was reported that the intent of Administration was to
eliminate all access at Old Cannery and Dunes Road for the 2016 season through construction
of a new access road to the south shore.
A recap on the purchase of properties and construction of a new access road was provided
advising the Legislature appropriated $1.9 million in 2013 for the project. Its Administrations
intent to construct Phase 1 (gravel surfacing) of the new roadway in the late 2015/early 2016 to
minimize environmental impacts so that the roadway is operational for the 2016 Personal Use
Fishery. Phase II, which includes paved surfaces for the new road, Royal Street, Old Cannery
Road, and other improvements, will occur following sale of the surplus properties.
Administration advised that Council’s adopted budget for the Fishery’s revenues was $573,517,
and expenditures $485,977, or revenues over expenditures of $86,540. Revenues were
projected at $556,593, and projected expenses were $462,913, or revenues over expenditures
of $$93,680. The Fishery Fund began FY2016 with a fund balance of $67,622 and given the
aforementioned numbers, the end fund balance of FY2016 was projected to be $161,342.
Administration recommends continuing to build the fund balance in the Personal Use Fishery
Fund to support capital expenditures, and to protect the City’s General Fund. This year the
City’s expended $65,010 for capital improvements and there have already been a list of
requests from departments for next year.
Koch noted that Administration would be recommending the City institute a $10 daily drop-
off/pick-up fee from 12:00a.m. – 11:59 p.m. which would have the potential of generating
$30,000 to $40,000 in revenue. These revenues would go toward raking fish waste, renting and
serving portable and permanent toilets, solid waste pick-up and disposal, and public safety
which were all services used by those dropped off daily to use the Fishery.
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It was reported that the fee shacks were able to capture the following information:
• Data showed participants with 538 different mailing zip codes
• 11% of the participants had a 99611 zip code
• Participants from the Central Peninsula were 20%
• Entire Kenai Peninsula Borough totaled 25%
• Largest user group was from the Municipality of Anchorage with 54%
Approximately 77% of all fee transactions were for participants who were not residents of the
City of Kenai. It’s estimated that non-city residents would pay $30,800 of the $40,000 in new
fees. In 2015 City of Kenai residents paid approximately $32,000 of fees collected during the
fishery; 6% of total fees collected.
Finance Director Eubank advised that there were small changes to fees including the
elimination of season passes at the dock during the fishery and changes to times related
parking and overnight permits.
Mr. Preston, a Kenai Resident, thanked the City for posting speed limits on the river and no
wake zones during the fishery.
It was requested by a resident to reinstate the season pass, as it is a financial burden for him to
pay daily launch fees during the fishery.
Council Member Boyle noted that he would like to see the season pass reinstate and would like
to see Council revisit this matter. Boyle further noted that he was opposed to implementing fees
for drop-off.
Gabriel noted that for every positive action there’s an unforeseen negative effect; Gabriel noted
that Council has in the past discussed providing City residents a reduced fee, however it was
discovered that there were legal ramifications.
Council Member Molloy agreed that Council should discuss the season pass matter and that he
wasn’t in favor or opposition of the drop-off fee, but maybe the cost of $10 could be reduced.
Molloy further noted that the City should look at discounts on fees for City residents.
Knackstedt agreed that the amount of the drop-off fee could be considered and that he would
like to further research the season pass matter to see if it would be the in the best interest of the
City to be reinstated.
Council thanked Administration for their continued efforts in creating a better Fishery.
The work session adjourned at 7:15 p.m.
Notes prepared by:
_______________________________
Sandra Modigh, CMC
City Clerk
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MEMO:
TO: Mayor and City Council Members
FROM: Sandra Modigh, City Clerk
DATE: November 24, 2015
SUBJECT: Liaison Nominations
Pursuant to KMC 1.90.010, “….At the organizational meeting of Council, or as soon thereafter
as practicable, the Mayor, after consultation with Council, shall nominate Council Members as a
council liaison to any board, commission or committee.”
Mayor Porter requested the following be placed in the packet for nomination as liaisons:
Council on Aging Vice Mayor Brian Gabriel
Airport Commission Council Member Tim Navarre
Harbor Commission Council Member Terry Bookey
Parks and Recreation Commission Council Member Bob Molloy
Planning and Zoning Commission Council Member Henry Knackstedt
Beautification Committee Council Member Mike Boyle
Mini-Grant Steering Committee Mayor Pat Porter
Kenai River Special Management Board
(KRSMA)
Administrative Staff Member
Economic Development District City Manager Rick Koch
Cook Inlet Regional Citizens Advisory Council
(CIRCAC)
John Williams, Citizen
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: 907-283-7535 / FAX: 907-283-3014
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MEMO:
TO: Mayor and City Council Members
FROM: Sandra Modigh, City Clerk
DATE: November 24, 2015
SUBJECT: Planning & Zoning Commission Vacancies
This correspondence is to advise that as of December 31, 2015, there will be two
vacancies on the Planning & Zoning Commission due to two commissioner’s terms
expiring. All requirements pursuant to Code have been met to fill the vacancies.
Applications received for consideration are attached to this correspondence.
Pursuant to KMC 14.05.015 (b),”… the Mayor shall make nominations only from the list
of persons who timely submitted an application…” and, as per 14.15.015 (c), “… The
Kenai City Council shall review the Mayor’s nomination no later than the next regular
Council meeting following the meeting in which the Mayor made the nomination…”
Council shall consider confirmation of the Mayor’s nomination no later than the
December 16 meeting, but may confirm at the December 2 meeting.
Attachments
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: 907-283-7535 / FAX: 907-283-3014
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KENAI PARKS & RECREATION COMMISSION
NOVEMBER 5, 2015
CITY HALL COUNCIL CHAMBERS
7:00 P.M.
CHARIMAN PRO TEMP NOEL WIDMAYER, PRESIDING
MEETING SUMMARY
1. CALL TO ORDER & ROLL CALL
Chairman Pro Temp Widmayer called the meeting to order at 7:10 p.m. Roll was confirmed as
follows:
Commissioners present: E. Castillo, M. Lindeman, N. Widmayer,
Commissioners absent: H. Spann, R. Tunseth, A. Hull, C. Stephens
Staff/Council Liaison present: Parks & Rec Staff Member B. Frates
No quorum was present.
2. AGENDA APPROVAL
3. APPROVAL OF MEETING SUMMARY – October 8, 2015
4. PERSONS SCHEDULED TO BE HEARD – None
5. PERSONS PRESENT NOT SCHEDULED – None
6. UNFINISHED BUSINESS
a. Beaver Creek Park Playground
b. Municipal Park Turf Area
7. NEW BUSINESS – None
8. REPORTS
a. Parks and Recreation Director
b. Commission Chair
c. City Council Liaison
9. NEXT MEETING ATTENDANCE NOTIFICATION – December 3, 2015
10. COMMISSION QUESTIONS & COMMENTS
11. PERSONS PRESENT NOT SCHEDULED TO BE HEARD – None.
12. INFORMATION – None.
13. ADJOURNMENT
Page 115 of 156
Meeting summary prepared and submitted by:
_____________________________________
Jamie Heinz, CMC
Deputy City Clerk
Page 116 of 156
KENAI OUTDOOR OPPORTUNITY LOCATION COMMITTEE MEETING
NOVEMBER 10, 2015
KENAI PUBLIC LIBRARY
6:00 P.M.
CHARIMAN BRIAN GABRIEL, PRESIDING
MEETING SUMMARY
1. CALL TO ORDER & ROLL CALL
Chair Gabriel called the meeting to order at 6:00 p.m.
Roll was confirmed as follows:
Committee Members present: B. Gabriel, B. Shiflea, S. Merry, M. Smith, C. Parker,
Committee Members absent: P. Morin, A. Hull, T. Elder
Staff/Council Liaison present: Parks & Rec Director B. Frates, City Manager R. Koch
A quorum was present.
2. AGENDA APPROVAL
MOTION:
Committee Member Smith MOVED to approve the agenda; Committee Member Parker
SECONDED the motion. There were no objections, SO ORDERED.
3. APPROVAL OF MINUTES
a. September 8, 2015
b. October 13, 2015
MOTION:
Committee Member Shiflea MOVED to approve the meeting minutes and Committee Member
Smith SECONDED the motion. There were no objections, SO ORDERED.
4. UNFINISHED BUSINESS
a. Review Conceptual Site Plans
Committee Member Parker reviewed the four site plan options and explained considerations
given for natural layout of terrain and surrounding land features such as mountain views and the
inlet. Various elevations for the stage were briefly discussed.
It was noted that wind and sound were two factors that would need to be taken into
consideration at some point in the design phase.
Existing utilities, including gravity and pressurized mains were also reviewed.
Page 117 of 156
5. NEW BUSINESS
a. Presentation of Component Cost Estimates
Administration reviewed various cost estimates, explaining that the costs are very preliminary
and may be high. It was also explained that given the size of the project, it provided the
opportunity to be a phased project.
Preliminary costs were reviewed for the event area, spectator area, parking lot, vendor spaces,
restrooms, stage and miscellaneous items such as pathways and picnic tables.
b. Prioritize Event Park Components
It was suggested that individual components be examined and prioritized. It was requested that
consideration be given to phased prioritization.
6. DISCUSS PURPOSE OF NEXT MEETING
It was decided that refining the stage design and prioritizing the event park components would
be discussed at the next meeting.
7. SCHEDULE FOR NEXT AND SUBSEQUENT MEETINGS
It was decided that the next meeting would be held on November 24, 2015 at 6:30 p.m..
8. PUBLIC COMMENT
Bob MacIntosh noted dissatisfaction with the potential high costs of developing an event park,
particularly given the economic climate.
9. COMMITTEE QUESTIONS AND COMMENTS
Committee Member Smith expressed interest in the stage design and location of restroom
facilities in relation to the stage, parking lot, etc.
Committee Member Shiflea thanked Committee Member Merry for his work on the stage, and
also thanked administration for the cost estimates.
Committee Chair Gabriel expressed gratitude for everyone’s work to date and stated he feels
the committee is on track and making good progress
10. ADJOURNMENT
There being no further business before the Commission, the meeting was adjourned at 7:20 p.m.
Meeting summary prepared and submitted by:
_____________________________________
Jamie Heinz, CMC
Deputy City Clerk
Page 118 of 156
CITY OF KENAI
PLANNING & ZONING COMMISSION
CITY COUNCIL CHAMBERS
NOVEMBER 10, 2015 - 7:00 P.M.
CHAIR JEFF TWAIT, PRESIDING
MINUTES
1. CALL TO ORDER:
Commissioner Twait called the meeting to order at 7:00 p.m.
a. Pledge of Allegiance
Twait led those assembled in the Pledge of Allegiance.
b. Roll Call
Commissioners present: G. Pettey, D. Fikes, R. Springer, J. Twait, K. Peterson, J.
Glendening, J. Focose
Staff/Council Liaison present: City Planner M. Kelley, City Attorney S. Bloom, Chief of Police G.
Sandahl, Planning Assistant W. Anderson, Deputy City Clerk J.
Heinz, Council Liaison H. Knackstedt
A quorum was present.
c. *Excused Absences
d. Agenda Approval
Chairman Twait noted the following requested additions to the packet:
Add to Item 6a Memorandum dated July 14, 2015 from Council Member Molloy
Add to Item 6a Questions for Kenai City Council providing direction to the Planning
& Zoning Commission
MOTION:
Commissioner Peterson MOVED to approve the agenda with requested revisions;
Commissioner Fikes SECONDED the motion. There were no objections; SO ORDERED.
e. Consent Agenda
MOTION:
Commissioner Peterson MOVED to approve the consent agenda and Commissioner Fikes
SECONDED the motion. There were no objections; SO ORDERED.
*All items listed with an asterisk (*) are considered to be routine and non-controversial by
Page 119 of 156
the Commission and will be approved by one motion. There will be no separate discussion
of these items unless a Commission Member so requests, in which case the item will be
removed from the Consent Agenda and considered in its normal sequence on the agenda
as part of the General Orders.
2. *APPROVAL OF MINUTES: October 28, 2015
Approved by the consent agenda.
3. SCHEDULED PUBLIC COMMENT: (10 Minutes) – None.
4. PERSONS PRESENT NOT SCHEDULED: (3 Minutes) – None.
5. CONSIDERATION OF PLATS: None.
6. PUBLIC HEARINGS:
a. PZ15-30 – Resolution recommending an Ordinance to the Council of the City of Kenai,
Alaska, Amending Kenai Municipal Code Chapter 14.20.230 – Home Occupations, to
Prohibit Commercial Marijuana Establishments as Allowed Uses, Amending Kenai
Municipal Code Chapter 14.20.320 – Definitions, to Add Marijuana Related Definitions,
Enacting Kenai Municipal Code Chapter 14.20.330 - Standards for Commercial
Marijuana Establishments, Creating Standards for Commercial Marijuana
Establishments and Amending Kenai Municipal Code Chapter 14.22.010 – Land Use
Table, to Add Commercial Marijuana Establishment Uses and Regulations and Make
Other Housekeeping Changes.
City Planner Kelley reviewed his staff report recommending approval of the resolution, which
recommended Council’s adoption of the draft ordinance that was prepared upon several Work
Sessions conducted by the Planning Commission.
MOTION:
Commissioner Peterson MOVED to approve Resolution No. PZ15-30 and Commissioner Pettey
SECONDED the motion.
Chairman Twait opened the public hearing.
Dolly Phelps spoke against prohibiting home occupation for cultivation; explained it would
exacerbate the black market. She explained that people were already growing it in their homes
and the limited cultivation license was created to allow the home growers. She pointed out that
some provisions were in conflict with state regulations and encouraged amending the draft
ordinance after the state’s regulations were set. She also gave an overview of what a home
cultivation facility would look like.
Patricia Patterson spoke in favor of allowing those growing plants in their homes be able to
obtain licensure; noted that the draft ordinance left the limited cultivator out of the market. She
also asked for clarification on the Conditional Use Permit process relevant to state licensure.
Joshua Bird spoke against the Conditional Use Permit process as it made it more difficult for
Page 120 of 156
businesses to be legal and get out of the black market. He encouraged using the states
definitions for buffer zones. He also noted that the Marijuana Control Board might consider
removing the prohibition on marijuana clubs from state regulations.
Michael Reynolds spoke against the draft ordinance pointing out that the black market isn’t
going to go away because the bigger market will come in and there will be no way for there to
be smaller markets. He spoke in favor of someone from community owning and maintaining the
market as opposed to some one else coming in and taking over.
Dolly Phelps, again spoke in favor of the limited cultivation license. She explained that plants
are tracked and there was no way for a licensee to get it out of the tracking system without
destroying the marijuana. She also explained the surveillance requirements and acknowledged
the need for a generator backup to meet the surveillance requirements.
There being no one else wishing to speak, the public hearing was closed.
It was pointed out that licensure as currently written in the draft Marijuana Control Board
regulations would be limited to Alaska residents.
It was clarified that where the word greenhouse was plural in two places could be
administratively fixed to be singular.
VOTE:
YEA: Twait, Focose, Glendening, Fikes, Peterson, Springer
NEA: Pettey
MOTION PASSED.
7. UNFINISHED BUSINESS: None.
8. NEW BUSINESS: None.
9. PENDING ITEMS: None.
10. REPORTS:
a. City Council – Knackstedt reported that two culverts in the Kenai Spur Highway were
slated to be replaced; reviewed the action agenda of the November 4 Council meeting,
which was provided in the packet.
b. Borough Planning – Glendening reported the action taken by the Borough Planning
Commission and Platting Committee at their November 9 meetings; 3 plats approved; 1
postponed. He also reported that the Planning Commissions approved a resolution that
defined the term water dependent.
c. Administration – Kelley reported on the following matters:
• Upcoming joint work session with the Airport Commission regarding rezoning
airport lands on November 12.
• Upcoming APA training and subsequent conference.
Page 121 of 156
11. PERSONS PRESENT NOT SCHEDULED: None.
12. INFORMATIONAL ITEMS: None.
13. NEXT MEETING ATTENDANCE NOTIFICATION: December 9, 2015
Commissioner Fikes noted she would not be present.
COMMISSION COMMENTS & QUESTIONS:
Commissioners Focose and Glendening thanked the Chief of Police for attending.
Commissioner Pettey explained that she voted no on PZ15-30 to give City Council the option to
opt out of commercial legalization of marijuana and represents the portion of the community that
voted against legalization.
Commissioner Twait thanked the City Attorney and Chief of Police for attending.
14. ADJOURNMENT:
There being no further business before the Commission, the meeting was adjourned at
8:21 p.m.
Minutes prepared and submitted by:
_____________________________
Jamie Heinz, CMC
Deputy City Clerk
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Page 156 of 156
This report was issued by BDO USA, LLP, a Delaware limited liability partnership and
the U.S. member of BDO International Limited, a UK company limited by guarantee.
City of Kenai, Alaska
Federal and State Single Audit Reports
Year Ended June 30, 2015
City of Kenai, Alaska
Federal and State Single Audit Reports
Year Ended June 30, 2015
City of Kenai, Alaska
Contents
Page
Single Audit Section
Independent Auditor’s Report on Internal Control Over
Financial Reporting and on Compliance and Other Matters
Based on an Audit of Financial Statements Performed in
Accordance With Government Auditing Standards 1-2
Independent Auditor’s Report on Compliance For Each Major
Federal Program; Report on Internal Control over Compliance;
and Report on Schedule of Expenditures of Federal Awards
Required by OMB Circular A-133 3-5
Independent Auditor’s Report on Compliance For Each Major
State Program; Report on Internal Control over Compliance;
and Report on the Schedule of State Financial Assistance
Required by the State of Alaska Audit Guide and Compliance
Supplement for State Single Audits 6-8
Schedule of Expenditures of Federal Awards 9-10
Schedule of State Financial Assistance 11-12
Notes to Schedules of Expenditures of Federal Awards and
State Financial Assistance 13
Schedule of Findings and Questioned Costs 14-15
Summary Schedule of Prior Audit Findings 16
Corrective Action Plan 17
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
1
3601 C Street, Suite 600
Anchorage, AK 99503
Tel: 907-278-8878
Fax: 907-278-5779
www.bdo.com
Independent Auditor's Report on Internal Control Over Financial Reporting and
on Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance With Government Auditing Standards
Honorable Mayor and City Council
City of Kenai, Alaska
We have audited, in accordance with the auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States, the financial
statements of the governmental activities, the business-type activities, each major fund, and
the aggregate remaining fund information of City of Kenai, Alaska as of and for the year ended
June 30, 2015, and the related notes to the financial statements, which collectively comprise
City of Kenai’s basic financial statements, and have issued our report thereon dated November
30, 2015.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered City of Kenai’s
internal control over financial reporting (internal control) to determine the audit 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
City of Kenai’s internal control. Accordingly, we do not express an opinion on the effectiveness
of City of Kenai’s internal control.
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. A significant deficiency is a
deficiency, or a combination of deficiencies, in internal control that is less severe than a
material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control
that might be material weaknesses or significant deficiencies. Given these limitations, during
our audit we did not identify any deficiencies in internal control that we consider to be material
weaknesses. However, material weaknesses may exist that have not been identified.
2
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City of Kenai’s financial statements
are free from material misstatement, we performed tests of its compliance with certain
provisions of laws, regulations, contracts, and grant agreements, noncompliance with which
could have a direct and material effect on the determination of financial statement amounts.
However, providing an opinion on compliance with those provisions was not an objective of our
audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no
instances of noncompliance or other matters that are required to be reported under
Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of
the entity’s internal control or on compliance. This report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the entity’s
internal control and compliance. Accordingly, this communication is not suitable for any other
purpose.
Anchorage, Alaska
November 30, 2015
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
3
3601 C Street, Suite 600
Anchorage, AK 99503
Tel: 907-278-8878
Fax: 907-278-5779
www.bdo.com
Independent Auditor’s Report on Compliance For Each Major Federal Program;
Report on Internal Control Over Compliance; and Report on the Schedule of
Expenditures of Federal Awards Required by OMB Circular A-133
Honorable Mayor and City Council
City of Kenai, Alaska
Report on Compliance for Each Major Federal Program
We have audited City of Kenai’s compliance with the types of compliance requirements
described in the OMB Circular A-133 Compliance Supplement that could have a direct and
material effect on each of City of Kenai’s major federal programs for the year ended June 30,
2015. City of Kenai’s major federal programs are identified in the summary of auditor’s results
section of the accompanying schedule of findings and questioned costs.
Management’s Responsibility
Management is responsible for compliance with the requirements of laws, regulations,
contracts, and grants applicable to its federal programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of City of Kenai’s major
federal programs based on our audit of the types of compliance requirements referred to above.
We conducted our audit of compliance in accordance with auditing standards generally
accepted in the United States of America; the standards applicable to financial audits contained
in Government Auditing Standards, issued by the Comptroller General of the United States; and
OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those
standards and OMB Circular A-133 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal program
occurred. An audit includes examining, on a test basis, evidence about City of Kenai’s
compliance with those requirements and performing such other procedures as we considered
necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each
major federal program. However, our audit does not provide a legal determination of City of
Kenai’s compliance.
Opinion on Each Major Federal Program
In our opinion, City of Kenai complied, in all material respects, with the types of compliance
requirements referred to above that could have a direct and material effect on each of its
major federal programs for the year ended June 30, 2015.
4
Report on Internal Control Over Compliance
Management of City of Kenai is responsible for establishing and maintaining effective internal
control over compliance with the types of compliance requirements referred to above. In
planning and performing our audit of compliance, we considered City of Kenai’s internal control
over compliance with the types of requirements that could have a direct and material effect on
each major federal program to determine the auditing procedures that are appropriate in the
circumstances for the purpose of expressing an opinion on compliance for each major federal
program and to test and report on internal control over compliance in accordance with OMB
Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal
control over compliance. Accordingly, we do not express an opinion on the effectiveness of City
of Kenai’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a
control over compliance does not allow management or employees, in the normal course of
performing their assigned functions, to prevent, or detect and correct, noncompliance with a
type of compliance requirement of a federal program on a timely basis. A material weakness in
internal control over compliance is a deficiency, or combination of deficiencies, in internal
control over compliance, such that there is a reasonable possibility that material noncompliance
with a type of compliance requirement of a federal program will not be prevented, or detected
and corrected, on a timely basis. A significant deficiency in internal control over compliance is
a deficiency, or a combination of deficiencies, in internal control over compliance with a type
of compliance requirement of a federal program that is less severe than a material weakness in
internal control over compliance, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control over compliance was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal
control over compliance that might be material weaknesses or significant deficiencies. We did
not identify any deficiencies in internal control over compliance that we consider to be material
weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of
our testing of internal control over compliance and the results of that testing based on the
requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other
purpose.
5
Report on Schedule of Expenditures of Federal Awards Required by OMB Circular A-133
We have audited the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of City of Kenai as of
and for the year ended June 30, 2015, and the related notes to the financial statements, which
collectively comprise City of Kenai’s basic financial statements. We issued our report thereon
dated November 30, 2015, which contained unmodified opinions on those financial statements.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the basic financial statements. The accompanying Schedule of
Expenditures of Federal Awards is presented for purposes of additional analysis as required by
OMB Circular A-133 and is 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
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 Schedule of Expenditures of Federal Awards is fairly stated in all
material respects in relation to the basic financial statements as a whole.
Anchorage, Alaska
November 30, 2015
6
3601 C Street, Suite 600
Anchorage, AK 99503
Tel: 907-278-8878
Fax: 907-278-5779
www.bdo.com
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of
the international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
Independent Auditor’s Report on Compliance for Each Major State Program;
Report on Internal Control Over Compliance; and Report on Schedule of State
Financial Assistance Required by the State of Alaska Audit Guide and Compliance
Supplement for State Single Audits
Honorable Mayor and City Council
City of Kenai, Alaska
Report on Compliance for Each Major State Program
We have audited City of Kenai’s compliance with the types of compliance requirements
described in the State of Alaska Audit Guide and Compliance Supplement for State Single
Audits that could have a direct and material effect on each of City of Kenai’s major state
programs for the year ended June 30, 2015. City of Kenai’s major state programs are identified
in the accompanying Schedule of State Financial Assistance.
Management’s Responsibility
Management is responsible for compliance with the requirements of laws, regulations,
contracts, and grants applicable to its state programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of City of Kenai’s major state
programs based on our audit of the types of compliance requirements referred to above. We
conducted our audit of compliance in accordance with auditing standards generally accepted in
the United States of America; the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States; and
the State of Alaska Audit Guide and Compliance Supplement for State Single Audits. Those
standards and the State of Alaska Audit Guide and Compliance Supplement for State Single
Audits require that we plan and perform the audit to obtain reasonable assurance about
whether noncompliance with the types of compliance requirements referred to above that could
have a direct and material effect on a major state program occurred. An audit includes
examining, on a test basis, evidence about City of Kenai’s compliance with those requirements
and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each
major state program. However, our audit does not provide a legal determination of City of
Kenai’s compliance.
Opinion on Each Major State Program
In our opinion, City of Kenai complied, in all material respects, with the types of compliance
requirements referred to above that could have a direct and material effect on each of its
major state programs for the year ended June 30, 2015.
7
Report on Internal Control Over Compliance
Management of City of Kenai is responsible for establishing and maintaining effective internal
control over compliance with the types of compliance requirements referred to above. In
planning and performing our audit of compliance, we considered City of Kenai’s internal control
over compliance with the types of requirements that could have a direct and material effect on
each major state program to determine the auditing procedures that are appropriate in the
circumstances for the purpose of expressing an opinion on compliance for each major state
program, and to test and report on internal control over compliance in accordance with the
State of Alaska Audit Guide and Compliance Supplement for State Single Audits, but not for the
purpose of expressing an opinion on the effectiveness of internal control over compliance.
Accordingly, we do not express an opinion on the effectiveness of City of Kenai’s internal
control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a
control over compliance does not allow management or employees, in the normal course of
performing their assigned functions, to prevent, or detect and correct, noncompliance with a
type of compliance requirement of a state program on a timely basis. A material weakness in
internal control over compliance is a deficiency, or combination of deficiencies, in internal
control over compliance, such that there is a reasonable possibility that material noncompliance
with a type of compliance requirement of a state program will not be prevented, or detected
and corrected, on a timely basis. A significant deficiency in internal control over compliance is
a deficiency, or a combination of deficiencies, in internal control over compliance with a type
of compliance requirement of a state program that is less severe than a material weakness in
internal control over compliance, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control over compliance was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal
control over compliance that might be material weaknesses or significant deficiencies. We did
not identify any deficiencies in internal control over compliance that we consider to be material
weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of
our testing of internal control over compliance and the results of that testing based on the
requirements of the State of Alaska Audit Guide and Compliance Supplement for State Single
Audits. Accordingly, this report is not suitable for any other purpose.
8
Report on Schedule of State Financial Assistance Required by the State of Alaska Audit
Guide and Compliance Supplement for State Single Audits
We have audited the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of City of Kenai as of
and for the year ended June 30, 2015, and the related notes to the financial statements, which
collectively comprise City of Kenai’s basic financial statements. We issued our report thereon
dated November 30, 2015 which contained unmodified opinions on those financial statements.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the basic financial statements. The accompanying Schedule of State
Financial Assistance is presented for purposes of additional analysis as required by the State of
Alaska Audit Guide and Compliance Supplement for State Single Audits and is 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 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 Schedule of State
Financial Assistance is fairly stated in all material respects, in relation to the basic financial
statements as a whole.
Anchorage, Alaska
November 30, 2015
Catalog of
FederalFederal
DomesticTotalShare of
GrantAssistanceGrantExpend-
Federal Grant TitleNumberNumberAwarditures
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Passed through the State of Alaska Department of Health
and Social Services:
Nutrition, Transportation, and Support607-309-1510 93.04430,000$ 29,776$
Nutrition, Transportation, and Support607-309-1510 93.04592,000 91,189
Passed through the State of Alaska Department of
Administration - NSIP-Kenai Senior Services607-15-PA-10893.05313,949 13,949
Total Department of Health and Human Services 134,914
DEPARTMENT OF JUSTICE
Bulletproof Vest PartnershipKPD-FY1516.6071,220 1,220
DEPARTMENT OF TRANSPORTATION
Conduct Airport Master Plan3-02-0142-045-2010 20.106531,608 119,239
Conduct Airport Master Plan-Phase II3-02-0142-052-201320.106246,177 109,972
Airfield Marking3-02-0142-049-201320.106260,968 96,669
Plow Truck W/Attachments3-02-0142-051-2014 20.106509,724 499,749
Total CFDA 20.106 825,629
Passed through the State of Alaska Department of
Transportation and Public Facilities-
Click It or Ticket402PT150600E70120.6002,498 2,498
Total Department of Transportation 828,127
DEPARTMENT OF AGRICULTURE
Passed through the State of Alaska Department of
Natural Resources -
Card Street FireFY15 Fire10.6648,499 8,499
DEPARTMENT OF HOMELAND SECURITY
Passed through the State of Alaska Department of
Military and Veteran Affairs-
2013 October KPB FloodDR-416197.03688,015 79,386
Schedule of Expenditures of Federal Awards
City of Kenai, Alaska
Year Ended June 30, 2015
9
Catalog of
FederalFederal
DomesticTotalShare of
GrantAssistanceGrantExpend-
Federal Grant TitleNumberNumberAwarditures
INSTITUTE OF MUSEUM AND LIBRARY SERVICES
Passed through the State of Alaska Department of
Education and Early Development:
Continuing Education GrantELM15747945.310909$ 909$
Continuing Education GrantLS-00-14-0002-14 45.3105,000 5,000
Continuing Education Grant2015 ALA Conf 45.3101,500 1,500
Continuing Education Grant2015 ALA Conf 45.310412 412
Total Institute of Museum and Library Services 7,821
Total Expenditures of Federal Awards 1,059,967$
City of Kenai, Alaska
Schedule of Expenditures of Federal Awards, continued
Year Ended June 30, 2015
10
TotalState
GrantShare of
State Grant TitleGrant Number AwardExpenditures
DEPARTMENT OF COMMERCE, COMMUNITY AND
ECONOMIC DEVELOPMENT
Public Improvements09-DC-214 1,000,000$ 20,665$
*Kenai River Bluff Stabilization11-DC-248250,000 227,079
Capital Improvements - Industrial Park 12-RR-022761,650 30,350
City Streets Paving Improvements12-DC-3761,000,000 9,333
Capital Improvements - City Hall12-DC-375200,000 58,341
*Road and Infrastructure Improvements 13-DC-5734,000,000 315,650
*Public Safety Improvements14-DC-064 90,000 90,000
Public Safety Improvements14-DC-065110,000 76
State Personal Use Fishery Improvements14-DC-066150,000 56,105
*Water/Sewer Improvements14-DC-067 2,500,000 178,593
Kenai Recreation Center Improvements15-DC-077 250,000 45,057
*Kenai River South Beach Dip Net Access 15-DC-0781,900,000 75,642
*New City Light/Heavy Equipment Storage Building15-DC-0791,900,000 97,823
*WWTP Upgrades & Renovations Designs15-DC-081200,000 120,858
Shared Fish Business Tax 20153,308 3,308
*Revenue Sharing2015441,046 441,046
Total Department of Commerce, Community and
Economic Development 1,769,926
DEPARTMENT OF ADMINISTRATION
*State PERS Relief 20153,595,447 3,595,447
DEPARTMENT OF ENVIRONMENTAL CONSERVATION
*Water Treatment Main - Phase II475521,557,000 143,151
DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT
Public Library AssistancePLA-15-747-39 6,650 6,650
DEPARTMENT OF HEALTH AND SOCIAL SERVICES
Nutrition, Transportation, and Support 607-309-1510 65,135 65,135
DEPARTMENT OF MILITARY AND VETERANS AFFAIRS
Police TrainingFY152,000 2,000
2013 October KPB Flood/Third Ave DR-416129,338 26,462
Total Department of Military and Veterans Affairs 28,462
DEPARTMENT OF TRANSPORTATION
AND PUBLIC FACILITIES
Airport Master Plan5357113,990 3,138
Conduct Airport Master Plan - Phase II573028,206 3,666
Airfield Marking573099,009 3,222
Airfield Marking5716016,991 16,658
Total Department of Transportation and Public Facilities 26,684
Schedule of State Financial Assistance
City of Kenai, Alaska
Year Ended June 30, 2015
11
TotalState
GrantShare of
State Grant TitleGrant Number AwardExpenditures
DEPARTMENT OF REVENUE
Liquor Licenses201519,350$ 19,350$
Electric and Telephone Shared Revenues201532,038 32,038
*Raw Fish Tax 2015289,411 289,411
Aviation Fuel Tax 20159,567 9,567
Total Department of Revenue 350,366
DEPARTMENT OF PUBLIC SAFETY
Sexual Assault Response Team20152,131 2,131
Total State Financial Assistance 5,987,952$
City of Kenai, Alaska
Schedule of State Financial Assistance, continued
Year Ended June 30, 2015
12
City of Kenai, Alaska
Notes to Schedules of Expenditures of Federal Awards
And State Financial Assistance
Year Ended June 30, 2015
13
1. Basis of Presentation
The accompanying Schedules of Expenditures of Federal Awards and State Financial Assistance
(the “Schedules”) includes the federal and state grant activity of City of Kenai, Alaska under
programs of the federal government and State of Alaska for the year ended June 30, 2015. The
information in the Schedules is presented in accordance with the requirements of OMB Circular
A-133, Audits of States, Local Governments, and Nonprofit Organizations, and the State of
Alaska Audit Guide and Compliance Supplement for State Single Audits. Because the Schedules
present only a selected portion of the operations of City of Kenai, Alaska, they are not intended
to and do not present the financial position, changes in net position or cash flows of City of
Kenai, Alaska.
Except as otherwise noted, expenditures reported on the Schedules are reported on the
modified accrual basis of accounting.
2. Major Program
Federal major programs are identified in the summary of auditor’s results section of the Schedule
of Findings and Questioned Costs. State major programs are identified on the Schedule of State
Financial Assistance with an asterisk (*).
3. PERS On-Behalf
The City has recorded $3,595,447 in PERS On-Behalf payments in the Schedule of State Financial
Assistance. This represents the PERS relief payment appropriated and transferred into the plan
during FY2015.
In the governmental fund financial statements, on-behalf revenue and expenditure has been
recognized in this amount. However, in the full accrual financial statements, GASB 68 provisions
prescribe that on-behalf pension contributions in a special funding situation may only be
recognized during the measurement period in which the plan recognizes the contributions,
effectively creating a one-year timing difference between the cash contribution and revenue and
expense recognition by the City.
As a result of these perspective and timing differences, amounts reported in the financial
statements may not agree to the amounts reported on the Schedule of State Financial Assistance.
City of Kenai, Alaska
Schedule of Findings and Questioned Costs
Year Ended June 30, 2015
14
Section I - Summary of Auditor’s Results
Financial Statements
Type of auditor’s report issued: Unmodified
Internal control over financial reporting:
Material weakness(es) identified? yes X no
Significant deficiency(ies) identified? yes X (none reported)
Noncompliance material to financial statements noted? yes X no
Federal Financial Assistance
Internal control over major programs:
Material weakness(es) identified? yes X no
Significant deficiency(ies) identified? yes X (none reported)
Type of auditor’s report issued on compliance for
major programs: Unmodified
Any audit findings disclosed that are required to be reported
in accordance with Section 510(a) of Circular A-133? yes X no
Identification of major programs:
CFDA Number Name of Federal Program or Cluster Agency
20.106 Airport Improvement Program Department of Transportation
Dollar threshold used to distinguish between a type A and type B
program: $300,000
Auditee qualified as low-risk auditee? X yes no
State Financial Assistance
Internal control over major programs:
Material weakness(es) identified? yes X no
Significant deficiency(ies) identified? Yes X none reported
Type of auditor’s report issued on compliance for
major programs: Unmodified
Dollar threshold used to distinguish a state major program: $75,000
City of Kenai, Alaska
Schedule of Findings and Questioned Costs
Year Ended June 30, 2015
15
Section II - Financial Statement Findings Required to be Reported in Accordance with
Government Auditing Standards
There were no findings related to the financial statements which are required to be reported in
accordance with the standards applicable to financial audits contained in Government Auditing
Standards.
Section III - Federal Award Findings and Questioned Costs
There were no findings and questioned costs for federal awards (as defined in section .510(a) of
the Circular) that are required to be reported.
Section IV – State Award Findings and Questioned Costs
There were no findings and questioned costs for State awards (as defined in the State of Alaska
Audit Guide and Compliance Supplement for State Single Audits) that are required to be reported.
City of Kenai, Alaska
Summary Schedule of Prior Audit Findings
Year Ended June 30, 2015
16
Financial Statement Findings in Accordance with Government Auditing Standars
There were no prior year audit findings.
Federal Award Findings and Questioned Costs
There were no prior year audit findings.
State Award Findings and Questioned Costs
There were no prior year audit findings.
City of Kenai, Alaska
Corrective Action Plan
Year Ended June 30, 2015
17
There are no current year findings; therefore no corrective action plan is required.
CĔĒĕėĊčĊēĘĎěĊ
AēēĚĆđ
FĎēĆēĈĎĆđ RĊĕĔėę
Fiscal Year :
July 1, 2014 – June 30, 2015
CITY OF KENAI, ALASKA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2015
INTRODUCTION SECTION Page
Table of Contents i
Letter of Transmittal 1
GFOA Certificate of Achievement 5
Organization Chart 6
List of Principal Officials 7
FINANCIAL SECTION
Auditor Report - Report of Independent Auditors 9
Management’s Discussion and Analysis 13
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Position 21
Statement of Activities 22
Fund Financial Statements:
Governmental Funds:
Balance Sheet 24
Statement of Revenues, Expenditures, and Changes in Fund Balances 26
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund
Balances of Governmental Funds to the Statement of Activities
28
Proprietary Funds:
Statement of Net Position 29
Statement of Revenues, Expenses, and Changes in Net Position 30
Statement of Cash Flows 31
Kenai Community Foundation Agency Fund - Statement of Fiduciary Assets & Liabilities 32
Notes to Basic Financial Statements 33
Required Supplementary Information
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual:
General Fund 53
Airport Special Revenue Fund 59
Water and Sewer Special Revenue Fund 61
Schedule of the City's Information on the Net Pension Liability - Public Employees
Retirement System 63
Schedule of the City Contributions - Public Employees Retirement System 64
Notes to Required Supplementary Information 65
Other Governmental Funds
Nonmajor Governmental Funds:
Combining Balance Sheet 68
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 70
i
Page
Nonmajor Governmental Funds - Continued:
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual:
Personal Use Fishery Special Revenue Fund 72
Council on Aging Special Revenue Fund 74
2010 Bond Debt Service Fund 76
General Government Land Sales Permanent Fund 77
Airport Land Sales Permanent Fund 78
Internal Service Funds:
Statement of Net Position 79
Combining Statement of Revenues, Expenses and Changes in Net Position 80
Combining Statement of Cash Flows 81
Fiduciary Fund
Kenai Community Foundation Agency Fund - Statement of Changes in Assets and Liabilities 83
Statistical Section
Table I - Net Position by Component 85
Table II - Change in Net Position 86
Table III - Governmental Activities Tax Revenues by Source 88
Table IV - Fund Balances of Governmental Funds 89
Table V - Changes in Fund Balances of Governmental Funds 90
Table VI - General Governmental Tax Revenues by Source 91
Table VII - Taxable Sales by Category 92
Table VIII - Sales Tax Rates – Direct and Overlapping Governments 93
Table IX - Ratios of Outstanding Debt by Type 94
Table X - Computation of Direct and Overlapping Debt 94
Table XI - Legal Debt Margin Information 95
Table XII - Demographic and Economic Statistics 96
Table XIII - Principal Employers 97
Table XIV - Full-time Equivalent City Government Employees by Fund 98
Table XV - Operating Indicators by Function 99
Table XVI - Capital Asset Statistics by Function 100
ii
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
OF THE
CITY OF KENAI, ALASKA
Year Ended June 30, 2015
Pat Porter
Mayor
Rick R. Koch
City Manager
Prepared by
Finance Department
Terry A. Eubank, CPA
Finance Director
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: 907-283-7535 / FAX: 907-283-3014
www.ci.kenai.ak.us
November 30, 2015
Honorable Mayor Pat Porter,
City Council Members and Citizens of
the City of Kenai, Alaska
In accordance with Section 29.35.120 of the Alaska Statutes and the City Charter, we are pleased to submit the
Comprehensive Annual Financial Report for the year ended June 30, 2015. The financial statements were
prepared in conformance with generally accepted accounting principles (GAAP) and audited in accordance with
generally accepted auditing standards by a firm of licensed certified public accountants.
This report consists of management’s representations concerning the finances of the City of Kenai.
Consequently, management assumes full responsibility for the completeness and reliability of the information
presented in this report. To provide a reasonable basis for making these representations, management of the
City has established a comprehensive internal control framework that is designed both to protect the
government’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of
the City’s financial statements in conformity with GAAP. Because the cost of internal controls should not
outweigh their benefits, the City’s comprehensive framework of internal controls has been designed to provide
reasonable rather than absolute assurance that the financial statements will be free from material misstatements.
As management, we assert that, to the best of our knowledge and belief, this financial report is complete and
reliable in all material respects.
The City’s financial statements have been audited by BDO USA, LLP., a firm of independent certified public
accountants. The goal of the independent audit was to provide reasonable assurance that the financial
statements of the City for the fiscal year ended June 30, 2015 are free of material misstatement. The
independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements; assessing the accounting principles used and significant estimates made by management;
and evaluating the overall financial statement presentation. The independent auditor concluded, based upon the
audit, that there was a reasonable basis for rendering an unmodified opinion that the City’s financial statements
for the fiscal year ended June 30, 2015, are fairly presented in conformity with GAAP. The independent auditor’s
report is presented as the first component of the financial section of this report.
The independent audit of the financial statements of the City was part of broader State and federally mandated
"Single Audits" designed to meet the special needs of State and federal grantor agencies. The standards
governing Single Audit engagements require the independent auditor to report not only on the fair presentation of
the financial statements, but also on the audited government's internal controls and compliance with certain legal
requirements, with special emphasis on internal controls and legal requirements involving the administration of
federal and state awards. These reports are available in the City's separately issued Single Audit Reports.
1
GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic
financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is
designed to complement the MD&A and should be read in conjunction with it. The City's MD&A can be found
immediately following the report of the independent auditors.
Profile of the City of Kenai
The City was incorporated in 1960 as a home rule city and its charter was adopted May 20, 1963. The City
occupies a geographic area of approximately 45 square miles located in the south central part of the state of
Alaska. Major city services include police, fire, ambulance, airport, street maintenance, recreation, parks, building
inspection, water and sewer, dock, cemetery and library. Funding for the City’s General Fund, by order of
financial significance, is provided from sales tax, intergovernmental revenue, property tax, charges for services,
other sources and interest earnings. Other funds rely on charges for services, interest earnings, grants and other
sources.
The City operates under a council - manager form of government. Policy-making and legislative authority are
vested in a governing council consisting of six members and the mayor. The city manager, attorney and clerk are
appointed by the council. The council and mayor are elected on a non-partisan basis. Council members serve
three-year staggered terms, with 2 members elected each year and are elected at large. The mayor is elected at
large and serves a three-year term. The city manager is the City's chief executive officer and is responsible for
carrying out the policies and ordinances of the City, for overseeing the day-to-day operations of the government
and for hiring the heads of the various departments.
Budgetary Control
The annual budget serves as the foundation for the City's financial planning and control. All departments submit
budgets to the city manager on or about the last Monday in February. The city manager uses these requests for
developing a proposed budget. The city manager submits the proposed budget to the council at the first regular
council meeting in April. The council is required to hold public hearings on the proposed budget and generally
adopts the budget by ordinance at the first meeting in June. The city manager is authorized to make budget
transfers within a fund for amounts less than $5,000. Council action is required for transfers between funds, for
transfers exceeding $5,000 and for new appropriations. Budget-to-actual comparisons are provided in this report
for each individual governmental fund for which an annual budget has been adopted.
Factors Affecting Financial Condition
Economy
The primary private sector portions of Kenai’s economy are oil and gas, commercial fishing, tourism and retail
sales. The future holds challenges for oil and gas and commercial fishing in the Cook Inlet region. Gas supplies
in quantities needed for liquefied natural gas (LNG), home heating and electrical power generation are projected
to run out in this decade if new supplies are not made available through discovery or pipelines from other
production areas. A gas pipeline from the North Slope to Cook Inlet would greatly enhance the viability of the
industrial complex. The State of Alaska is working with the gas producers and other interested entities to develop
a gas pipeline, but when a gas line will be built is not known at this time. Chevron, Shell and Forest Oil are all
making significant investments in this region. Cook Inlet Natural Gas Storage Alaska operates a natural gas
storage facility within the City. The facility has greatly enhanced the availability of gas within the Cook Inlet Basin
during all seasons of the year and has produce an estimated $565,500 in property tax revenue to the City at its
current 4.35 mill rate.
2
The proposed Pebble Mine, which is across Cook Inlet from Kenai, continues to be in the news for its world class
prospects for copper, gold and molybdenum. Actual production will be years in the future, but Kenai’s airport
could be a much busier place if the project gets all of the permits required for operation.
Commercial fishing has had some good years recently in terms of production. Raw fish prices declined a bit for
the 2015 fishing season but there was a strong return of sockeye salmon to peninsula rivers. Fishing is expected
to continue to be an important component of the Kenai economy.
With the slow recovery of the United States economy, tourism increased this fiscal year. The unique dipnet
fishery at the mouth of the Kenai River, where tens of thousands of Alaskans catch a year’s supply of sockeye
salmon in July, makes Kenai a busy and very popular place. Accessible beaches, beautiful scenery, fishing and
abundant historic sites all make Kenai a great destination for tourists on the Kenai Peninsula. Tourism is
expected to remain a vital component of the Kenai economy.
Sales tax is the largest revenue source for the City. Retail sales businesses generate the largest share of sales
tax revenue. Sales tax revenues for the current fiscal year exceeded projections by over 6%, and unanticipated
yet welcome increase. This sector is vibrant and growing in Kenai with the opening of new businesses in the City.
Overall, the projection for the economy of Kenai is optimistic. Kenai is situated in a beautiful area with abundant
land and natural resources, an accommodative business climate, and a stable population base.
Long term financial planning
General Fund, fund balance increased $0.5 million to $10.3 million in FY 2015. A General Fund, Fund Balance
of $10.3 million represents approximately 63% of one year’s of expenditures. This healthy fund balance provides
options for the City and generates interest income that can be used for operations.
One of the larger financial challenges facing the City is our contribution to the Public Employees Retirement
System ( PERS). Beginning in FY 2008, employers paid a maximum of 22% of payroll and the State is paying the
difference to the actuarially required rate. Employer members of the PERS system worked with the State
legislature for a long term solution to this problem. In April 2008 the Alaska Legislature passed Senate Bill 125
which converts the existing Public Employees Retirement System (PERS) from an agent-multiple employer plan
to a cost-sharing plan. Under the cost-sharing arrangement, the State of Alaska Division of Retirement and
Benefits will no longer track individual employer assets and liabilities. Rather, all plan costs and past service
liabilities will be shared among all participating employers. The cost-sharing plan will require a uniform employer
contribution rate of 22% or less of active member wages, subject to a wage floor. In addition, the legislation
provides for state contributions in the event that the annually calculated and board adopted rate, which includes a
provision to pay down the past-service liability, exceeds 22%. Any such additional contributions would
be recognized by each employer as an on-behalf payment. In FY 2015 the State of Alaska invested an extra
$1.0 billion in PERS to reduce its unfunded liability. With the on-behalf funding arrangement this $1.0 billion
infusion increases the City’s General Fund revenues and expenditures by $1.9 million, an occurrence that is not
expected to repeat itself in coming years.
The City is actively pursuing economic development opportunities and the long-term financial outlook is positive.
Award
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of
Achievement for Excellence in Financial Reporting to the City of Kenai for its comprehensive annual financial
report for the fiscal year ended June 30, 2014. In order to be awarded a Certificate of Achievement, a
government must publish an easily readable and efficiently organized comprehensive annual financial report. This
report must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive
annual financial report continues to meet the Certificate of Achievement Program’s requirements and we are
submitting it to the GFOA to determine its eligibility for another certificate.
3
Acknowledgment
The preparation of this Comprehensive Annual Financial Report in a timely manner was accomplished with the
efficient and dedicated service of the entire staff of the Finance Department. Due credit should also be given to
the City Council for their efforts in planning and conducting the financial operations of the City in a responsible
manner.
Respectfully submitted,
___________________________
Rick Koch, City Manager
___________________________
Terry A. Eubank, CPA
Finance Director
4
5
CITIZENS
COMMISSIONS
Airport
Harbor
Parks and Recreation
Library
Planning and Zoning
CITY COUNCIL BOARDS, COUNCILS
AND COMMITTEES
Council on Aging
Beautification Comm.
Personnel Arbitration
Board
CITY CLERK CITY ATTORNEY
City of Kenai
Organization Chart
CITY MANAGER
FIREFINANCE
POLICE
AIRPORT
SENIOR CENTER
LIBRARY
PARKS,
RECREATION &
BEAUTIFICATION PUBLIC WORKS /
CAPITAL PROJECT
MANAGEMENT
6
CITY OF KENAI, ALASKA
ORGANIZATION AND PRINCIPAL CITY OFFICIALS
Kenai was founded in 1791. It is located south of Anchorage on Cook Inlet in the
Central Kenai Peninsula. The City is 161 highway miles from Anchorage. By air,
Kenai is three hours from Seattle and thirty minutes from Anchorage.
Kenai was the site of the first major oil strike in 1957 and has served as a center
for exploration and production since that time. Commercial fishing and
processing contribute to the economy.
Kenai adopted the Council Manager form of government in 1963 and has been
operating under this form since that time.
The City Council, together with appointed City officials, meets the first and third
Wednesday of each month in the City Administration Building for regular Council
sessions. In addition, numerous special meetings and work sessions are
scheduled throughout the year. The Council, which consists of the Mayor and six
council members, is elected at large and on a non-partisan basis. Annual
elections are held in October. The terms of office are three years but are
overlapping so that the City is provided with a continuity of knowledge in City
business and legislative matters.
City Council Term Ends
Mayor Pat Porter 2016
Council Members Robert Molloy 2015
RyanMarquis 2015
TerryBookey 2016
Brian Gabriel, Sr. 2016
Henry Knackstedt 2017
TimNavarre 2017
City Administration
City Manager Rick R. Koch
Finance Director Terry A. Eubank
City Clerk Sandra Modigh
City Attorney Scott Bloom
Police Chief Gus Sandahl
Fire Chief Jeff Tucker
Public Works Manager Sean Wedemeyer
Librarian Mary Jo Joiner
Parks & Recreation Director Robert Frates
Airport Manager Mary Bondurant
Senior Center Project Director Rachael Craig
7
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8
AUDITOR REPORT
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms
3601 C Street, Suite 600
Anchorage, AK 99503
Tel: 907-278-8878
Fax: 907-278-5779
www.bdo.com
Independent Auditor's Report
Honorable Mayor and City Council
City of Kenai, Alaska
Report on the Financial Statements
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 City of Kenai,
Alaska, as of and for the year ended June 30 , 2015, and the related notes to the financial
statements, which collectively comprise the City of Kenai’s basic financial statements as listed in the
table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this
includes the design, implementation, and maintenance of internal control relevant to the preparation
and fair presentation of financial statements that are free from material misstatement, whether due
to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the financial statements, whether due to
fraud or error. In making those risk assessments, the auditor considers internal control relevant to
the entity’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such
opinion. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of significant accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinions.
9
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 City of Kenai as of June 30, 2015, and the
respective changes in financial position and, where applicable, cash flows thereof for the year then
ended in accordance with accounting principles generally accepted in the United States of America.
Change in Accounting Principle
As discussed in Note I to the financial statements, in 2015 City of Kenai adopted the provisions of
Governmental Accounting Standards Board (GASB) Statement Number 68, Accounting and Financial
Reporting for Pensions. 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 Management’s
Discussion and Analysis on pages 13 through 19, the budgetary comparison information on pages 53
through 62, and the Schedules of Net Pension Liability and Pension Contributions on pages 63 and 64
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 City of Kenai’s basic financial statements. The accompanying combining and
individual fund financial statements and schedules listed in the table of contents are presented for
purposes of additional analysis and are not a required part of the basic financial statements.
The supplementary 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. Such information has been subjected to the auditing procedures applied in the audit of
the basic financial statements and certain additional procedures, including comparing and reconciling
such information directly to the underlying accounting and other records used to prepare the basic
financial statements or to the basic financial statements themselves, and other additional procedures
in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the supplementary information is fairly stated, in all material respects, in relation to the
basic financial statements as a whole.
The accompanying introductory and statistical sections, as listed in the table of contents, have not
been subjected to the auditing procedures applied in the audit of the basic financial statements, and
accordingly, we do not express an opinion or provide any assurance on them.
10
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated November
30, 2015, on our consideration of City of Kenai’s internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements
and other matters. The purpose of that report is to describe the scope of our testing of internal
control over financial reporting and compliance and the results of that testing, and not to provide an
opinion on the internal control over financial reporting or on compliance. That report is an integral
part of an audit performed in accordance with Government Auditing Standards in considering City of
Kenai’s internal control over financial reporting and compliance.
Anchorage, Alaska
November 30, 2015
11
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12
MANAGEMENT’S DISCUSSION AND ANALYSIS
Management’s Discussion and Analysis
As management of the City of Kenai, we offer readers of our financial statements this narrative overview and
analysis of the financial activities of the City of Kenai for the fiscal year ended June 30, 2015. We encourage
readers to consider the information presented here in conjunction with additional information that we have
furnished in our letter of transmittal.
Financial Highlights
The assets of the City of Kenai exceeded its liabilities at June 30, 2015 by $176,721,771. Of this amount,
unrestricted net position of $9,228,578, may be used to meet the government’s ongoing obligations to
citizens and creditors. A significant portion of this legally unrestricted amount has been designated for
specific purposes.
The City’s total net position decreased by $904,833. Beginning net position was restated (see Note I) for
the implementation of GASB Pronouncement 68. For the fiscal year ended June 30, 2015, governmental
type activities decreased by $834,869 and business type activities decreased by $69,964.
As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund
balances of $43,540,284, an increase of $310,456 from the prior year. The fund balances of the two
permanent funds, which cannot be spent, account for $26.6 million of total fund balance. About $9.0
million of the remaining fund balance is restricted, committed, or assigned. The remaining $7.9 million is
unassigned and available for spending.
At the end of the current fiscal year, fund balance for the General Fund was $10,391,233. Of this amount
$7,937,025 was unassigned and available for spending.
The City has a long-term liability for compensated absences, general obligation debt, and net pension of
$831,813, $1,615,000, and $8,631,519 respectively. The general obligation bonds were issued on March
11, 2010 for an addition to the City’s library.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City of Kenai’s basic financial
statements. The City of Kenai’s basic financial statements are comprised of 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. The basic
financial statements include two kinds of statements that present different views of the City’s activities:
Government-wide financial statements provide both short-term and long-term information about
the City’s overall financial condition in a summary format.
Fund financial statements focus on individual parts of the City, reporting the City’s operations in
more detail than the government-wide statements.
Government-wide financial statements.
The government-wide financial statements are designed to provide readers with a broad overview of the City of
Kenai’s finances in a manner similar to a business enterprise. The statement of net position presents information
on all of the City’s assets and liabilities. Net position – the difference between the City’s assets and deferred
outflows and its liabilities and deferred inflows - is one way to measure the City’s financial position. Over time,
increases or decreases in net position may serve as a useful indicator of whether the financial position of the City
is improving or deteriorating. There are other non-financial factors, such as the condition of facilities, roads and
other infrastructure that should be considered in the evaluation of overall financial condition.
The statement of activities presents information showing how a government’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.
13
Both of the government-wide financial statements distinguish functions of the City 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 Kenai include general government, public safety, public works, parks,
recreation and cultural, airport, water and sewer, and social services. The business-type activities of the City
include the congregate housing facility.
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, 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 of Kenai 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 fund financial statements focus on 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 the two. Five of the City’s governmental funds are considered major 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 major funds including: the General Fund; the Airport Special
Revenue Fund; the Water & Sewer Special Revenue Fund, the Airport Land Sales Permanent Fund; and the
Airport Improvements Capital Project Fund. Individual fund data for each of the non-major governmental funds is
provided in the form of combining statements elsewhere in this report.
A budgetary comparison statement has been provided for the General Fund, Airport Special Revenue Fund and
Water & Sewer Special Revenue Fund to demonstrate compliance with the Fiscal Year (FY) 2015 budget.
Proprietary funds.
The City of Kenai maintains two different types of proprietary funds: enterprise and internal service. Enterprise
funds are used to report the same functions presented as business-type activities in the government-wide
financial statements. The City uses an enterprise fund to account for the Congregate Housing Facility.
Information for this fund is presented in the proprietary statement of net position and the proprietary statement of
revenues, expenses and changes in fund net position. Internal service funds are used to accumulate and allocate
costs internally among the City’s various functions. The City of Kenai uses an internal service fund to account for
the purchase of heavy equipment that is primarily used by the General Fund and for the cost in managing major
capital projects of the City. Because these services predominantly benefit governmental rather than business type
functions, they have been included within governmental activities in the government-wide financial statements but
are presented separately in the proprietary fund financial statements.
Fiduciary funds.
Through a management agreement, the City manages the donations of the Kenai Community Foundation, a
501(c)(3) not-for-profit entity, whose purpose is to support museums, parks and recreation, music, fine arts,
library, and historic purposes within Kenai’s city limits. The City’s sole purpose is management of the
Foundation’s donations; all decisions regarding Foundation awards are made by the Foundation and not the City.
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.
14
Required supplementary information.
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information. Budgetary comparison schedules for the City’s major funds and schedules on the
City’s net pension obligation information and contributions can be found on pages 53-64 of this report.
Other information.
In addition to the basic financial statements and accompanying notes and required supplementary information
and accompanying notes, this report also presents certain other supplementary information. The combining
statements referred to earlier in connection with non-major funds are presented immediately after the required
supplementary information. Also included are budget comparisons for governmental funds other than the General
Fund, Airport Special Revenue Fund and Water & Sewer Special Revenue Fund.
Government-wide Financial Analysis.
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. At
June 30, 2015, the City’s position exceeded liabilities by $176,721,771. By far the largest portion of the City’s net
position reflects its investment in capital assets.
The following table provides a summary of the City’s net position:
Net Position
(in thousands)
Governmental Activities
Business-Type
Activities Total
2015 2014 2015 2014 2015 2014
Current and other assets $ 47,964 $ 46,863 $ 485 $ 608 $ 48,449 $ 47,471
Capital assets 138,911 140,028 3,051 3,071 141,962 143,099
Total assets 186,875 186,891 3,536 3,679 190,411 190,570
Deferred outflows of resources 957 - - - 957 -
Long-term liabilities outstanding 11,075 2,5153211,078 2,517
Other liabilities 2,354 1,345 63 137 2,417 1,482
Total liabilities 13,429 3,860 66 139 13,495 3,999
Deferred inflows of resources 1,151 248 - - 1,151 248
Net position:
Net investment in capital assets 137,296138,3343,0513,071140,347 141,405
Nonspendable 26,599 27,135--26,599 27,135
Restricted 547 480--547 480
Unrestricted 8,810 16,834 419 469 9,229 17,303
Total net position $173,252 $182,783 $3,470 $3,540 $176,722 $186,323
Minor arithmetic differences are due to rounding.
15
Governmental activities.
Governmental activities decreased the City’s net position by $834,869. The key element of this decrease is the
difference between capital expenditures by governmental funds and depreciation expense recorded but not
budgeted in the governmental funds.
Business-type activities.
Business-type activities decreased the net position of the City by $69,964. Rental rates of the Congregate
Housing Facility are insufficient to cover depreciation on the facility which was built primarily with grant funds.
Absent a rate increase, future declines in net position are expected.
Changes in Net Position.
The City’s total revenues and expenses for governmental and business-type activities are reflected in the
following table:
Changes in Net Position
(in thousands)
Governmental
Activities
Business-Type
Activities Total
2015 20142015 2014 2015 2014
Revenues:
Program revenues:
Charges for services $ 6,085 $ 5,867 $ 365$ 346 $ 6,450$ 6,213
Operating grants and contributions 2,1752,817 175 2,1922,822
Capital grants and contributions 2,4254,799 - - 2,425 4,799
General revenues:
Property taxes 3,6573,156 - - 3,6573,156
Sales taxes 7,2576,669 - - 7,2576,669
Other 790 3,495 2 5 792 3,500
Total revenues 22,389 26,803 384 356 22,773 27,159
Expenses:
General government 4,0972,277 - - 4,0972,277
Public safety 5,9007,291 - - 5,9007,291
Public works 3,6673,393 - - 3,6673,393
Parks, recreation, and cultural 2,3552,631 - - 2,3552,631
Water and sewer services 2,2372,711 - - 2,2372,711
Airport 4,1894,126 - - 4,1894,126
Interest on long-term debt 9698 - - 9698
Social welfare services 683765 - - 683765
Senior Housing - - 454 436 454 436
Total expenses 23,224 23,292 454 436 23,678 24,159
Increase (decrease) in net position
before transfers (835)3,511 (70) (80) (905) 3,431
Transfers - (112) - 112 - -
Increase (decrease) in net position (835)3,399(70)32 (905)3,431
Net position beginning as restated
(Note I) 174,087 179,384 3,540 3,508 177,627 182,892
Net position ending $173,252 $182,783 $3,470 $3,540 $176,722 $186,323
Minor arithmetic differences are due to rounding.
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Financial Analysis of the City’s Funds
The City of Kenai uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental Funds.
The purpose 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, 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.
The total fund balance of governmental funds is $43,540,284, which is up $310,456 from last year. About $7.9
million of fund balance is unassigned fund balance, which is available for spending at the City Council’s
discretion. The remainder of fund balance, $35.6 million, is nonspendable, restricted, committed or assigned
to indicate that it is not available for new spending. Nonspendable is the largest portion of this; $26.6 million is in
the two permanent funds, which do not allow spending of fund balance.
The General Fund is the chief operating fund of the City of Kenai. At the end of the current fiscal year,
unassigned fund balance of the General Fund was $7,937,025, and total fund balance was $10,391,233. Fund
balance increased $489,207 in the current year. The City’s reserves remain healthy and stable. As a measure of
liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund
expenditures and transfers out. Unassigned fund balance represents 46% of total expenditures and transfers,
while total fund balance represents 61% of that same amount.
General Fund expenditures are up $2,279,801 or 16.13% over last year. Public Employees Retirement System
(PERS) on-behalf funding from the State of Alaska increased $2,063,291 in the current year. PERS on-behalf
funding is recorded as both revenue and expenditure in the General Fund, accounting for nearly all of the
increase in expenditures. General Fund revenues increased $3,135,998 from last year. The primary revenue
sources of the General Fund include property tax of $3,647,001, sales tax of $7,257,451, intergovernmental
revenues of $3,844,226, and charges to other funds of $1,542,786. Sales tax revenue increased $588,025
(8.82%) an amount greater than inflation and a reflection of the overall condition of the City’s economy. Property
taxes increased by $497,977 (15.81%). Current year property values increased 3.5% but a 0.50 mill increase in
the tax levy is predominately responsible for this increase. Intergovernmental revenues increased $2,049,308
from last year with a notable increase in State of Alaska Public Employees Retirement System (PERS) on-behalf
funding described above.
Property Tax,
$3,647,001
Sales Tax,
$7,257,451
Intergovernmental,
$3,844,226
Charges for
Service,
$2,249,873
Interest,
$56,992 Miscellaneous,
$371,934
General Fund Revenues
17
Tax revenues support General Fund operations exclusively and represent 40.41% of all governmental funds
revenue. Other funds rely heavily on charges for services and investment earnings. Investment earnings in
governmental funds is down $2,710,049, (76.75%) from the prior year. The continuation of historic low interest
rates, volatility and negative returns of equity markets, which approximately 45% of the City’s permanent funds
are invested in, led to the significant decrease in investment earnings. Capital projects funds and the senior
services related funds are largely financed by grants from the federal, state and borough governments.
The Airport Special Revenue Fund accounts for the operation of the airport. Fund balance increased by
$223,731. Total revenues increased $260,788 with the single largest increase being intergovernmental from
State of Alaska Public Employees Retirement System (PERS) on-behalf funding, $156,663. Transfer to the
Airport Improvements Capital Project Fund decreased by $188,458 this fiscal year enhancing the funds financial
performance.
The Water & Sewer Special Revenue Fund accounts for the operations of the water and sewer utility of the City.
Fund balance increased $40,024. Water rates increased 10% and sewer rates were raised 3% during the year.
The combination of these rate increases resulted in charges for services increasing $187,764 this year. The
financial performance of this fund continues to improve with the implementation of rate increases suggested by
the utilities FY2011 rate study.
The Airport Land Sales Permanent Fund accounts for the investment of proceeds from the sale of airport lands
originally deeded to the City by the federal government for operations of the airport. City code calls for the
transfer of 5% of the funds five year average balance at December 31st to the Airport Special Revenue Fund to
fund airport operations. The continuation of historic low interest rates, volatility and negative returns of equity
markets resulted in a decrease in fund balance after the FY15 transfer of $1,135,313 to the Airport Special
Revenue Fund.
The Airport Improvements Capital Project Fund accounts for capital improvement projects of the Kenai Municipal
Airport. Projects are largely financed by grants from the Federal Aviation Administration and the State of Alaska
Department of Transportation. Current projects include completion of a new Airport Master Plan, purchase of
snow removal equipment, airfield marking improvements and improvements to airport facilities.
Proprietary Funds.
The City of Kenai maintains two different types of proprietary funds. Enterprise funds are used to report the same
functions presented as business-type activities in the government-wide financial statements. The Congregate
Housing Fund is the only enterprise fund. It is reported in the proprietary fund financial statements and as a
business type activity in the government-wide financial statements. Internal service funds are used to accumulate
and allocate costs among the City’s various functions. The City of Kenai has two internal service funds, the
Equipment Replacement Fund and the Capital Project Management Fund. The Equipment Replacement Fund is
used to account for the purchase of equipment costing more than $50,000. The Equipment Replacement Fund
charges the primary user department in the General Fund such that the General Fund reimburses the Equipment
Replacement Fund over the useful life of the asset. The Capital Project Management Fund was closed during the
year. Prior to its closure, the Capital Project Management Funds was used to account for the management of the
City’s major capital projects. The General Fund provided a one-time transfer of $97,004 to facilitate the closure of
the fund and future personnel costs for management of capital projects will be directly charged to the project.
Because the services of both the Equipment Replacement Fund and the Capital Project Management Fund
predominantly benefit governmental rather than business type functions, they have been included within
governmental activities in the government-wide financial statements but are presented in single columns in the
proprietary fund financial statements.
At year-end, Congregate Housing Fund net position totaled $3,470,130 and unrestricted net position was
$418,765. Net position decreased $69,964 for the year. Current revenues are simply insufficient to cover
expenses – especially considering depreciation. It is anticipated that net position will decline in future years
without an increase in tenant rents.
18
General Fund Budgetary Highlights
The General Fund appropriations budget was amended by the City Council during the year by $2,008,931.
Significant amendments included $1,762,437 was for State of Alaska Public Employees Retirement System
(PERS) on-behalf funding received in excess of what was originally budgeted and the one time operating transfer
to the Capital Project Management Fund to facilitate the fund’s closure during the fiscal year. Actual revenues
were $208,087 more than the final budget, with general sales tax $426,089 more than projected.
The actual expenditures and transfers out were $1,345,950 less than budgeted. The City typically does not
spend the entire authorized appropriation. The variance this year was about 7.3% of final budget compared to
8.6% last year. $752,092, (55.9%) of the lapse, occurred in personal services. Position vacancies, the
replacement of retiring employees with those lower on the City’s pay scale, and health insurance costs less than
projected contributed to these savings.
Capital Assets and Debt Administration
Capital assets.
At June 30, 2015 the City’s capital assets had a total net book value of $141,962,014. Governmental activities
totaled $138,910,649 and business-type activities totaled $3,051,365. Additional information on the City’s capital
assets can be found in the notes to the basic financial statements on pages 41-42 Section III. Detailed Notes on
All Funds’ D. Capital Assets. Major capital additions for FY15 included:
New Facilities and Facility Improvements:
City Hall $ 177,367
New City Shop 4,479,113
Senior Center 405,641
Congregate Housing 370,885
Water Treatment/Well House 4 893,737
Equipment:
Airport Snow Removal Equipment 533,066
Vehicles 150,693
Fire/Rescue Boat 105,837
Loader and attachments 320,100
Infrastructure:
Road improvements 885,270
Water & Sewer Mains 633,711
Other Additions 144,647
Total Additions $9,100,067
Debt administration.
No new debt was issued by the City in FY15. At June 30, 2015 $1,615,000 of Library Expansion bonds remain
outstanding and $2,000,000 of Bluff Erosion Control bonds remain authorized but unissued. There are long-term
liabilities for compensated absences totaling $831,813. With the implementation of GASB Statement 68, Net
Pension Liability of $8,631,519 is included for the first time and beginning net position was restated by $8,696,825
for its implementation. Additional information regarding this restatement can be found in Note I on page 50 of the
report. Additional information on the City’s long-term liabilities can be found in the notes to the basic financial
statements on page 48.
Requests for information.
This financial report is designed to provide a general overview of the City of Kenai’s finances for all those with an
interest in the government's finances. Questions concerning any of the information provided in this report or
requests for additional information should be addressed to the Finance Director, City of Kenai, 210 Fidalgo
Avenue, Kenai, Alaska 99611.
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BASIC FINANCIAL STATEMENTS
CITY OF KENAI, ALASKA
STATEMENT OF NET POSITION
JUNE 30, 2015
GovernmentalBusiness-type
Activities Activities Total
ASSETS
Equity in central treasury (cash and investments)44,413,569$ 481,253$ 44,894,822$
Receivables (net of allowances for
uncollectibles)3,549,300 3,195 3,552,495
Other assets 1,525 - 1,525
Land 6,001,559 274,500 6,276,059
Property and equipment in service 208,702,350 5,663,553 214,365,903
Accumulated depreciation (78,144,409) (2,886,688) (81,031,097)
Construction in progress 2,351,149 -2,351,149
Total assets 186,875,043 3,535,813 190,410,856
DEFERRED OUTFLOWS
Pension related 957,327 -957,327
Total assets and deferred outflows 187,832,370$ 3,535,813$ 191,368,183$
LIABILITIES
Accounts payable1,656,136$ 26,359$ 1,682,495$
Accrued payroll and payroll liabilities406,173 1,104 407,277
Unearned revenue 139,065 1,464 140,529
Other liabilities 138,331 33,908 172,239
Accrued interest 14,068 - 14,068
Long-term liabilities:
Due within one year 292,241 712 292,953
Due in more than one year 10,783,243 2,136 10,785,379
Total liabilities 13,429,257 65,683 13,494,940
DEFERRED INFLOWS
Prepaid licenses and fees2,500 - 2,500
Prepaid property taxes 151,738 - 151,738
Pension related 997,234 -997,234
Total deferred inflows 1,151,472 -1,151,472
NET POSITION
Net investment in capital assets137,295,649 3,051,365 140,347,014
Nonexpendable:
Airport Land Sale Permanent Fund23,711,029 - 23,711,029
General Government Land Sale Permanent Fund2,888,444 - 2,888,444
Restricted - youth athletics 546,706 - 546,706
Unrestricted 8,809,813 418,765 9,228,578
Total net position 173,251,641 3,470,130 176,721,771
Total liabilities, deferred inflows and net position 187,832,370$ 3,535,813$ 191,368,183$
See accompanying notes to basic financial statements.
21
OperatingCapital
Charges forGrants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Governmental activities:
General government4,097,380$ 421,241$ 924,254$ -$
Public safety 5,899,643 360,893 319,137 5,849
Public works 3,666,985 75,585 68,406 322,000
Parks, recreation, and cultural 2,355,007 670,565 109,369 142,089
Water and sewer services 2,237,426 2,485,588 44,206 630,250
Airport 4,188,728 1,977,259 46,814 852,315
Social welfare services 683,025 93,728 663,164 472,311
Interest on long-term debt 95,599 - --
Total governmental activities 23,223,793 6,084,859 2,175,350 2,424,814
Business-type activities:
Senior Housing454,429 365,450 16,482 -
Total Government 23,678,222$ 6,450,309$ 2,191,832$ 2,424,814$
General revenues:
Property taxes
Sales taxes
Unrestricted investment earnings
Total general revenues
Change in net position
Beginning net position - as restated (Note I)
Net position - ending
See accompanying notes to basic financial statements.
Program Revenues
CITY OF KENAI, ALASKA
STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2015
22
GovernmentalBusiness-type
Activities Activities Total
(2,751,885)$ -$ (2,751,885)$
(5,213,764) - (5,213,764)
(3,200,994) - (3,200,994)
(1,432,984) - (1,432,984)
922,618 - 922,618
(1,312,340) - (1,312,340)
546,178 - 546,178
(95,599) -(95,599)
(12,538,770) - (12,538,770)
-(72,497) (72,497)
(12,538,770) (72,497) (12,611,267)
3,656,927 - 3,656,927
7,257,451 - 7,257,451
789,523 2,533 792,056
11,703,901 2,533 11,706,434
(834,869) (69,964) (904,833)
174,086,510 3,540,094 177,626,604
173,251,641$ 3,470,130$ 176,721,771$
Net (Expenses) Revenues and
Changes in Net Position
23
Airport
Special
GeneralRevenue
ASSETS
Equity in central treasury
(cash and investments)9,623,477$ 4,311,639$
Receivables
(net of allowances for uncollectibles)2,096,698 88,206
Other assets1,525 -
Due from other funds30,630 -
Total assets 11,752,330$ 4,399,845$
LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES
Liabilities:
Accounts payable294,745$ 79,898$
Accrued payroll and payroll liabilities370,944 9,423
Due to other funds- -
Unearned revenue25,929 66,216
Other liabilities27,744 9,769
Total liabilities719,362 165,306
Deferred Inflows of resources:
Special assessments receivable - unavailable372,751 -
Ambulance billing receivable - unavailable95,349 -
Land sales - unavailable19,397 -
Prepaid licenses and fees2,500 -
Prepaid property taxes151,738 -
Total deferred inflows of resources641,735 -
Fund balances:
Nonspendable- -
Restricted546,706 -
Committed409,746 -
Assigned1,497,756 4,234,539
Unassigned7,937,025 -
Total fund balances10,391,233 4,234,539
Total liabilities, deferred inflows and fund balances11,752,330$ 4,399,845$
See accompanying notes to basic financial statements.
CITY OF KENAI, ALASKA
BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2015
24
Water & Sewer Airport Airport Total
Special Land SalesImprovements Other Governmental
Revenue PermanentCapital ProjectGovernmental Funds
1,248,699$ 23,568,024$ 485,646$ 3,921,665$ 43,159,150$
213,750 341,735 178,909 630,002 3,549,300
- - - - 1,525
- - - - 30,630
1,462,449$ 23,909,759$ 664,555$ 4,551,667$ 46,740,605$
173,863$ 10,479$ 551,824$ 545,327$ 1,656,136$
15,871 - - 9,935 406,173
- - - 30,630 30,630
- - 3,718 43,202 139,065
83,702 - - 17,116 138,331
273,436 10,479 555,542 646,210 2,370,335
- - - - 372,751
- - - - 95,349
- 188,251 - - 207,648
- - - - 2,500
- - - - 151,738
- 188,251 - - 829,986
- 23,711,029 - 2,888,444 26,599,473
- - - - 546,706
- - 109,013 792,285 1,311,044
1,189,013 - - 224,728 7,146,036
- - - - 7,937,025
1,189,013 23,711,029 109,013 3,905,457 43,540,284
1,462,449$ 23,909,759$ 664,555$ 4,551,667$
137,361,670
675,748
Bonds payable $ (1,615,000)
Net pension liability (8,631,519)
Compensated absences (828,965)
Accrued interest (net of related interest subsidy) (14,068)(11,089,552)
Deferred outflows for pensions 957,327
Deferred inflows for pensions (997,234)(39,907)
2,803,398
Net position of governmental activities173,251,641$
Capital assets used in governmental activities are not financial
resources and are not reported in the funds.
Other long-term assets are not available to pay for current period
expenditures and, therefore, are deferred in the funds.
Some liabilities, including bonds payable, interest payable on
bonds (net of related interest subsidy), and compensated
absences are not payable in the current period so they are not
reported in the funds.
Certain changes in net pension liabilities are deferred rather than
recognized immediately. These items are amortized over time:
Internal Service Funds are used by management to charge the
cost of certain activities to individual funds. The assets and
liabilities of the Internal Service Funds are included in
governmental activities in the statement of net position.
Amounts reported for governmental activities in the statement of
net position are different because:
25
AirportWater & SewerAirport
SpecialSpecialLand Sales
GeneralRevenueRevenuePermanent
Revenues:
Taxes10,914,378$ -$ -$ -$
Intergovernmental revenues3,844,226 225,082 255,777 -
Charges for services2,249,873 369,824 2,483,381 -
Investment earnings56,992 22,445 8,391 615,189
Miscellaneous revenues362,008 1,571,830 2,207 8,084
Total revenues 17,427,477 2,189,181 2,749,756 623,273
Expenditures:
Current:
General government 5,178,312 - - -
Public safety 6,876,330 - - -
Public works 2,331,233 - - -
Parks, recreation, and cultural 2,006,407 - - -
Water and sewer services - - 2,458,500 -
Airport - 2,885,425 - -
Social welfare services - - - -
Debt service:
Principal - - - -
Interest - - - -
Capital outlay 22,698 - - -
Total expenditures16,414,980 2,885,425 2,458,500 -
Excess of revenues
over (under) expenditures1,012,497 (696,244) 291,256 623,273
Other financing sources (uses):
Transfers in147,104 1,135,313 - -
Transfers out(670,394) (215,338) (251,232) (1,135,313)
Net other financing sources (uses)(523,290) 919,975 (251,232) (1,135,313)
Net changes in fund balances489,207 223,731 40,024 (512,040)
Fund balances - July 19,902,026 4,010,808 1,148,989 24,223,069
Fund balances - June 3010,391,233$ 4,234,539$ 1,189,013$ 23,711,029$
See accompanying notes to basic financial statements.
CITY OF KENAI, ALASKA
STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2015
26
Airport Total
ImprovementsOther Governmental
Capital ProjectGovernmentalFunds
-$ -$ 10,914,378$
852,315 2,062,744 7,240,144
- 532,511 5,635,589
- 118,107 821,124
- 452,189 2,396,318
852,315 3,165,551 27,007,553
- - 5,178,312
- 122,473 6,998,803
- 145,042 2,476,275
- 244,514 2,250,921
- - 2,458,500
- - 2,885,425
- 952,239 952,239
- 80,000 80,000
- 96,198 96,198
1,122,511 2,078,211 3,223,420
1,122,511 3,718,677 26,600,093
(270,196) (553,126) 407,460
215,338 824,622 2,322,377
- (147,104) (2,419,381)
215,338 677,518 (97,004)
(54,858) 124,392 310,456
163,871 3,781,065 43,229,828
109,013$ 3,905,457$ 43,540,284$
27
Net changes in fund balances - total governmental funds 310,456$
Expenditures for capital assets 2,988,725$
Current year depreciation (4,260,182) (1,271,457)
(205,071)
Accrued leave(13,592)$
Bond interest payable599
(12,993)
80,000
25,399
238,797
Change in net position of governmental activities (834,869)$
CITY OF KENAI, ALASKA
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2015
Amounts reported for governmental activities in the statement of activities are
different because:
Internal Service Funds are used by management to charge the cost of certain
activities to individual funds. The net revenue of Internal Service Fund
activities is reported with governmental activities.
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their
estimated useful lives.
Special assessments, taxes, land sales and ambulance services receivable
reported in the governmental activities are not revenues of the current period
using the flow of current financial resources basis. This is the decrease in
other long-term assets.
Some expenses reported in the statement of activities do not require the use
of current financial resources and, therefore, are not reported as expenditures
in governmental funds. This is the amount of the (increase) decrease in:
Repayment of the principal of long-term debt consumes current financial
resources of governmental funds but does not have any effect on net
position.
Changes related to net pension liability and related accounts can increase or
decrease net position. This is the net decrease in equity due to changes in
net pension liability and the related deferred inflows and outflows.
See accompanying notes to basic financial statements.
28
Business-type
Activities -
Enterprise Fund
Governmental
Activities -
Internal Service
Funds
Congregate
Housing
ASSETS
Current assets:
Equity in central treasury (cash and investments)481,253$ 1,254,419$
Accounts receivable3,195 -
Total current assets484,448 1,254,419
Noncurrent assets:
Land 274,500 -
Property and equipment in service, at cost:
Buildings 5,663,553 -
Equipment - 2,590,989
Total property and equipment in service5,663,553 2,590,989
Less accumulated depreciation(2,886,688) (1,042,010)
Net property and equipment in service2,776,865 1,548,979
Total assets 3,535,813$ 2,803,398$
LIABILITIES
Current liabilities:
Accounts payable26,359$ -$
Accrued payroll and payroll liabilities1,104 -
Unearned revenue1,464 -
Other liabilities 33,908 -
Total current liabilities62,835 -
Noncurrent liabilities - compensated absences2,848 -
Total liabilities 65,683 -
NET POSITION
Investment in capital assets 3,051,365 1,548,979
Unrestricted 418,765 1,254,419
Total net position3,470,130 2,803,398
Total liabilities and net position3,535,813$ 2,803,398$
CITY OF KENAI, ALASKA
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2015
See accompanying notes to basic financial statements.
29
Business-type
Activities -
Enterprise Fund
Governmental
Activities -
Internal Service
Funds
Congregate
Housing
Operating revenues:
Rents and leases365,430$ -$
Charges for services - 48,239
Other revenue 20 310,571
Total operating revenues 365,450 358,810
Operating expenses:
Personal services 68,746 64,386
Supplies 14,922 761
Utilities 83,881 465
Repair and maintenance 65,053 -
Insurance 8,807 1,186
Depreciation 136,137 154,700
Manager's fee 36,678 -
Miscellaneous 3,305 376
Expenses chargeable from other funds 36,900 4,786
Total operating expenses 454,429 226,660
Operating income (loss)(88,979) 132,150
Nonoperating revenues:
Intergovernmental grants16,482 -
Investment earnings 2,533 6,508
Gain on sale of capital assets -3,135
Total nonoperating revenues 19,015 9,643
Income (loss) before transfers (69,964) 141,793
Transfers in -97,004
Changes in net position (69,964) 238,797
Net position - July 1 3,540,094 2,564,601
Net position - June 30 3,470,130$ 2,803,398$
CITY OF KENAI, ALASKA
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET POSITION
PROPRIETARY FUNDS
YEAR ENDED JUNE 30, 2015
See accompanying notes to basic financial statements.
30
Business-type
Activities -
Enterprise Fund
Governmental
Activities - Internal
Service Funds
Congregate
Housing
Cash flows from operating activities:
Receipts from customers 359,972$ 48,239$
Payments to suppliers (284,440) (7,647)
Payments to employees (68,145) (71,485)
Receipts (payments) for interfund services (36,900) 310,571
Net cash provided (used) by operating activities (29,513) 279,678
Cash flows from noncapital financing activities:
- (81,111)
- 97,004
Decrease in Due to General Fund
Transfer in
State grant 16,482 -
Net cash provided by noncapital
financing activities 16,482 15,893
Cash flows from capital and related financing activities:
Acquisition and construction of capital assets (116,826) (320,100) Proceeds from sales of capital assets -15,000
Net cash used by capital and related financing activities (116,826) (305,100)
Cash flows from investing activities -Investment earnings received 2,533 6,508
Net decrease in cash and cash equivalents(127,324) (3,021)
Cash and cash equivalents, beginning608,577 1,257,440
Cash and cash equivalents, ending 481,253$ 1,254,419$
Operating income (loss)(88,979)$ 132,150$
Depreciation 136,137 154,700
Accounts receivable (3,164) -
Accounts payable (73,100) (73)
Accrued payroll and payroll liabilities 208 (2,187)
Compensated absences 393 (4,912)
Unearned revenue (2,314) - Other liabilities 1,306 -
Net cash provided (used) by operating activities (29,513)$ 279,678$
Reconciliation of operating income (loss) to net cash provided
(used) by operating activities:
Adjustments to reconcile operating income (loss) to net cash
provided (used) by operating activities:
CITY OF KENAI, ALASKA
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
YEAR ENDED JUNE 30, 2015
See accompanying notes to basic financial statements.
31
ASSETS
Equity in central treasury (cash and investments)66,143$
LIABILITIES
Due to Kenai Community Foundation66,143$
CITY OF KENAI, ALASKA
STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES
KENAI COMMUNITY FOUNDATION AGENCY FUND
JUNE 30, 2015
See accompanying notes to basic financial statements.
32
FOOTNOTES TO BASIC FINANCIAL STATEMENTS
CITY OF KENAI, ALASKA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2015
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting entity
The City of Kenai (City) was formed by a Home Rule Charter on May 20, 1963 under the provisions of
Alaska Statute, Title 29, as amended. The City operates under a council-manager form of government and
provides the following services: public safety (police, fire, animal control, and 911 communications), public
improvements, airport, dock facility, water and sewer, library, senior citizen, recreation, parks, planning and
general administrative services.
The financial statements of the City have been prepared in conformity with accounting principles generally
accepted in the United States of America (GAAP) as applied to government units. The Governmental
Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental
accounting and financial reporting principles. The more significant accounting principles of the government
are described below.
B. Government-wide and fund financial statements
The Government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all activities of the City. Governmental activities, which normally are
supported by taxes and intergovernmental revenues along with user fees, are reported separately from the
business-type activities, which rely to a significant extent on fees and charges for support. The effect of
any interfund activity, for the most part, has been removed from these statements. The statement of
activities demonstrates the degree to which the direct expenses of a given function or segment are offset
by program revenues. Direct expenses are those that are clearly identifiable with a specific function or
segment. Program revenues include charges to customers or applicants who use, purchase, or directly
benefit from the goods, services or privileges provided by a given segment or function and includes
restricted grants and contributions that are restricted to meeting the operations or capital requirements of a
particular function or segment. Taxes and other items not properly included in program revenues are
reported as general revenues. Major individual governmental and proprietary funds are reported as
separate columns in the fund financial statements.
C. Measurement focus and basis of accounting and financial statement presentation
The Government-wide and proprietary fund financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting. Revenues are recorded when earned and
expenses are recorded when a liability is incurred, regardless of the timing of cash flows. Grants and similar
programs are recognized as revenue as soon as all eligibility requirements imposed by the provider have
been met. Net position is reported as restricted when constraints placed on the net position is either
externally imposed by creditors, grantors, contributors, or laws or regulations of other governments or
imposed by law through constitutional provisions or enabling legislation.
Governmental fund type financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as
they are both measurable and available. Revenues are considered to be available when they are collectible
in the current period or soon enough thereafter 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 generally recorded when a liability is incurred, as under accrual accounting.
However, debt service expenditures, as well as expenditures related to claims and judgments and
compensated absences, are recorded only when payment is due.
33
Taxes, charge for services, and interest associated with the current fiscal period are all considered to be
susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the
portion of special assessment receivables due within the current fiscal period is considered to be
susceptible to accrual as revenue of the current period. All other revenue items are considered to be
measurable and available only when received by the government.
The City reports the following major governmental funds based on the quantitative criteria:
The General Fund is the City’s primary operating fund. It accounts for all financial resources of the
general government, except those required to be accounted for in another fund.
The Airport Special Revenue Fund accounts for activities of the airport except for land sales. It
relies on user fees and investment earnings to finance operations.
The Water & Sewer Special Revenue Fund accounts for activities of the City’s water and sewer
service. It relies on user fees to finance operations.
The Airport Land Sales Permanent Fund accounts for sales of airport land. All proceeds from
airport land sales are deposited into this account and invested with up to 5% of the fund’s balance
at December 31st of each year being available for transfer to the Airport Special Revenue Fund for
operations.
The Congregate Housing Enterprise Fund accounts for the activities of the senior housing project.
Primary funding source is rents from its tenants.
Additionally the City reports the following fund types:
Internal Service Funds – the Equipment Replacement Fund is an internal service fund. It accounts for the
purchase of equipment costing more than $50,000 that will be used by General Fund departments on a
cost-reimbursement basis. The Capital Project Management Fund is an internal service fund that accounts
for the management of the City’s capital projects on a cost-reimbursement basis. The Capital Project
Management Fund was closed during fiscal year 2015.
Agency Fund – the City utilizes this fund to account for the resources invested by the City, under a
management agreement, for the Kenai Community Foundation, a not-for-profit organization devoted to
supporting museums, parks and recreation, music, fine arts, library, and historic purposes within Kenai’s
city limits.
As a general rule the effect of interfund activity has been eliminated from the Government-wide financial
statements. Exceptions to this general rule are charges between the City’s enterprise functions and various
other functions of the City. Elimination of these charges would distort the direct costs and program
revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods, services,
or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions,
including special assessments. Internally dedicated resources are reported as general revenues rather
than as program revenues. Likewise, general revenues include all taxes.
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
enterprise fund and of the City’s internal service funds are charges to customers for sales and services.
Operating expenses for the enterprise fund and internal service 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.
34
Use of accounting estimates: The preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported revenues and expenses during the
reporting period. Actual results could differ from those estimates.
D. Assets, liabilities and net position or equity
1. Cash and cash equivalents
The City maintains a central treasury for most of its cash and cash equivalents, which is utilized by all funds.
For the purposes of these financial statements, the City of Kenai considers highly liquid investments that
are readily convertible to cash, with an original maturity of three months or less, to be cash equivalents.
Investment income is recorded in the General Fund, except that interest earned on cash held in the Water
and Sewer Special Revenue Fund (including cash in water and sewer related capital project funds), the
Airport Special Revenue Fund (including cash in the Airport Land Sales Permanent Fund and airport related
capital project funds), the Congregate Housing Enterprise Fund, and the Equipment Replacement Internal
Service Fund is recorded in these funds.
2. Receivables and payables
Activities between funds that are representative of lending/borrowing arrangements outstanding at the end
of the fiscal year are referred to as either “due to other funds” or “due from other funds” (i.e., the current
portion of interfund loans).
3. Restricted assets
Monies or other resources, the use of which is restricted by legal or contractual requirements are recorded
as restricted assets.
4. Capital assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items), are reported in the applicable governmental or business type activities
columns in the Government-wide financial statements. Capital assets are defined by the City as assets
with an initial, individual cost of more than $5,000. All infrastructure assets, including those acquired prior
to June 30, 1980, are reported. Such assets are recorded at historical cost or estimated historical cost if
purchased or constructed. Donated capital assets are recorded at estimated fair value at the date of
donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend
assets lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Property,
plant, and equipment of the City, is depreciated using the straight line method over the following estimated
useful lives:
Assets Years
Buildings costing more than $50,000 50
Buildings costing less than $50,000 25
Building improvements 25
Water and sewer infrastructure 50
Street infrastructure 30
Heavy equipment 20
Other equipment 10
Office equipment 5
35
5. Compensated absences
It is the City’s policy to permit employees to accumulate earned but unused vacation benefits. The City
makes annual appropriations for the amount of leave expected to be used, which is available to employees
at essentially their discretion. Each employee is allowed to accumulate up to 80 days of annual leave at
the end of a calendar year, with any excess accumulation paid in cash in the following January. All vacation
pay is accrued when incurred in the Government-wide and proprietary fund financial statements. A liability
for these amounts is reported in governmental funds only if they have matured, for example, as a result of
employee terminations or in situations where the leave is used but not yet paid. Most funds, except the
capital project funds, will be utilized to liquidate the liability for compensated absences. The most
significant, due to the fact that it has the largest payroll, is the General Fund.
6. Long-term obligations
In the Government-wide financial statements and proprietary fund type financial statements, long-term debt
and other long-term obligations are reported as liabilities in the applicable governmental activities, business-
type activities, or proprietary fund type statement of net position. In the fund financial statements,
governmental fund types recognize long-term debt obligations only when due.
7. Fund balances
In the fund financial statements, governmental funds report aggregate amounts for five classifications of
fund balances based on the constraints imposed on the use of these resources. The nonspendable fund
balance classification includes amounts that cannot be spent because they are either (a) not in spendable
form—prepaid items or inventories; or (b) legally or contractually required to be maintained intact.
The spendable portion of fund balances comprises the remaining four classifications: restricted, committed,
assigned, and unassigned.
Restricted fund balance. This classification reflects the constraints imposed on resources either (a)
externally by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed
by law through constitutional provisions or enabling legislation.
Committed fund balance. These amounts can only be used for specific purposes pursuant to constraints
imposed by formal ordinances of the City Council—the government’s highest level of decision making
authority. Those committed amounts cannot be used for any other purpose unless the City Council removes
the specified use by taking the same type of action imposing the commitment. This classification also
includes contractual obligations to the extent that existing resources in the fund have been specifically
committed for use in satisfying those contractual requirements.
Assigned fund balance. This classification reflects the amounts constrained by the City’s “intent” to be used
for specific purposes, but are neither restricted nor committed. The City Council has the authority to assign
amounts to be used for specific purposes by resolution. Assigned fund balances include all remaining
amounts (except negative balances) that are reported in governmental funds, other than the General Fund,
that are not classified as nonspendable and are neither restricted nor committed.
Unassigned fund balance. This fund balance is the residual classification for the General Fund. It is also
used to report negative fund balances in other governmental funds.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use externally
restricted resources first, then unrestricted resources—committed, assigned, and unassigned—in order as
needed.
36
8.Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of
resources related to pensions, and pension expense, information about the fiduciary net position of the
Public Employees’ Retirement System (PERS) and additions to/from PERS’s fiduciary net position have
been determined on the same basis as they are reported by PERS. For this purpose, benefit payments
(including refunds of employee contributions) are recognized when due and payable in accordance with the
benefit terms. Investments are reported at fair value.
II.STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Budgetary information
Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the
United States of America for all governmental fund types, except the Capital Project Funds which adopt
project-length budgets. All annual appropriations lapse at a fiscal year end.
Budgets for the general fund, special revenue funds, debt service funds, permanent funds and enterprise
funds are annual budgets. Capital project fund budgets are project-length budgets. The Equipment
Replacement Fund, which is an internal service fund, is not required to have a budget. The City Council
approves all asset acquisitions from this fund by resolution.
Annual budgets must be submitted to the City Council by the City Manager during or prior to the sixth week
preceding the first day of each fiscal year. The City Council must adopt an annual budget and set the tax
rates not later than the tenth day of June for the following fiscal year.
Budgetary control (the level at which expenditures may not exceed budget) is maintained at the object class
level by the encumbrance of estimated purchase amounts prior to the release of purchase orders to
vendors. Purchase orders which would result in an overrun of object class balances are not released until
additional appropriations are made available.
Amendments to appropriations may be made by the city administration by transfers within a fund in amounts
less than $5,000. Other amendments, including supplemental appropriations, may be made by the City
Council. The City Council authorized supplemental appropriations during the year in capital projects funds,
special revenue funds and the general fund. General fund supplemental appropriations were $2,008,931.
The majority of this was for additional Public Employee Retirement System on-behalf funding provided by
the State of Alaska, ($1,762,437) and for transfers to the Capital Project Management Fund in order to
close the fund during the fiscal year, ($97,004.)
Encumbrance accounting is employed in governmental funds. Encumbrances (e.g., purchase orders,
contracts) outstanding at year-end are reported as appropriate constraints of fund balances if they meet
the definitions and criteria as outlined above. These commitments will be reappropriated and honored
during the subsequent year.
Significant encumbrances exceeding $75,000 as of June 30, 2015 were:
Major Fund – Nonmajor
General Fund Gov’t Funds
Equipment purchase $168,249 $ -
Equipment Warm Storage Building Project - 1,739,775
Magic Ave. Construction Project - 202,647
VIP Drive Paving Project - 109,935
$168,249$2,052,357
37
III.DETAILED NOTES ON ALL FUNDS
A. Deposits and Investments
The City maintains a central treasury that is available for use by all funds. Each fund type's portion of the
central treasury is displayed on the balance sheet or statement of net position as "Equity in Central
Treasury" unless there is a deficit which is then shown as “Due to Other Funds”.
At year-end, all of the City's bank deposits were either insured or collateralized with securities held by the
City's agent in the City's name.
The City's general investment policy authorizes investment in: (a) obligations of the United States or an
agency or instrumentality of the United States; (b) certificates of deposit with banks and savings and loan
associations; (c) repurchase agreements; (d) money market mutual funds consisting primarily of obligations
of the United States or an agency or instrumentality of the United States, or repurchase agreements
collateralized with such obligations; and (e) the Alaska Municipal League Investment Pool (AMLIP).
Generally, investment maturities cannot exceed five years from the date of purchase. Repurchase
agreements must be collateralized with United States government obligations. Certificates of deposit must
be insured or collateralized with obligations of the United States or its agencies or instrumentalities.
Collateral must be held by a third party trustee. The City complied with its investment policy throughout the
year.
The City’s Airport Land Sales Permanent Fund investment policy authorizes investment in: (a) Corporate
obligations of investment grade quality as recognized by a nationally recognized rating organization; (b)
Domestic Equities, which taken as a whole, attempt to mirror the characteristics or replicate the Standard
& Poor's 500 Index, including both mutual funds and exchange traded funds (ETF’s); (c) Domestic Equities,
which taken as a whole, attempt to replicate the Standard & Poor's 400 Mid-Cap Index, including both
mutual funds and exchange traded funds; (d) Domestic Equities, which taken as a whole, attempt to
replicate the Standard & Poor's 600 Small-Cap Index, including both mutual funds and exchange traded
funds; (e) International Equities, which taken as a whole, attempt to replicate the Financial Times Stock
Exchange Developed ex North America Index, including both mutual funds and exchange traded funds; (f)
Equities, which taken as a whole, attempt to replicate the universe of domestic real-estate investment trusts
as represented by the Standard & Poor's REIT composite index, including both mutual funds and exchange
traded funds; and (g) Emerging Market Equities, which taken as a whole, attempt to replicate the Financial
Times Stock Exchange Emerging Index including both mutual funds and exchange traded funds.
Repurchase agreements must be collateralized with United States government obligations. Certificates of
deposit must be insured or collateralized with obligations of the United States or its agencies or
instrumentalities. The City complied with its investment policy throughout the year.
The Alaska Municipal League Investment Pool (AMLIP) is an external investment pool which is rated AAAm
for credit risk purposes. Alaska Statute 37.23 establishes regulatory oversight of the pool. The law sets
forth numerous requirements regarding authorized investments and reporting. On a monthly basis the
investments in the pool are reviewed for fair value by an independent pricing service. The values of
investments in the AML pool are approximately equal to fair value.
The fair value of the City's investments at year-end are shown below. All of the City’s remaining investments
are in the category of least risk and include investments that are insured or registered in the City’s name,
or securities that are held by the City or its agent in the City’s name. All of the United States treasury bills,
treasury notes, and United States agency securities are held in a custodial account in the Wells Fargo Trust
Department, and are recorded in its internal records in the City's name in accordance with a safekeeping
agreement. Wells Fargo is not a counter party to security transactions.
The City maintains an interest bearing checking account, which had a bank balance of $1,973,555 and a
carrying value of $1,948,028 at year-end. The City also holds a $20,000 certificate of deposit and cash on
hand of $2,280. These deposits are insured for the first $250,000 and the balance is collateralized by
securities held by a third party custodian in the City’s name.
38
As of June 30, 2015, the City had the following investments and maturities.
General City investments:
Investment Fair Value Less than 1 year 1 to 2 years 2 to 5 years
U.S. Agencies $ 3,999,005$ -$1,999,640$1,999,365
Wells Fargo Money Market 3,904,3843,904,384 --
Certificates of Deposit 8,414,4006,425,481993,672995,247
AMLIP 408,964 408,964 - -
Total $16,726,753 $10,738,829 $2,993,312 $2,994,612
General and Airport Land Sales Permanent Funds’ investments:
Investment Fair Value % of Portfolio
U.S. Treasury/Agencies $ 5,081,151 19.35%
Corporate Bonds 4,699,170 17.89
Wells Fargo Money Market 1,673,584 6.37
U.S. equity securities 9,704,852 36.95
International securities 3,848,787 14.66
Real estate equities 1,256,360 4.78
Total $26,263,904 100.00%
The following is a reconciliation of the City’s deposit and investment balances to the financial statements
at June 30, 2015.
Pooled CashKenai
and Community
Investments Foundation Totals
Bank deposits and cash on hand $ 1,970,308 $ - $ 1,970,308
Investments 42,924,514 66,143 42,990,657
$44,894,822 $66,143 $44,960,965
Interest Rate Risk. The fair values of the City’s general fixed-income investments fluctuate in response to
changes in market interest rates. Increases in prevailing interest rates generally translate into decreases
in fair values of those instruments. Fair values of interest rate sensitive instruments may be affected by the
creditworthiness of the issuer, prepayment options, relative values of alternative investments, the liquidity
of the instrument, and other general market conditions. The City manages interest rate risk by requiring
specific percentages of the portfolio to be invested within certain time periods and the policy limits the
longest maturity to five years. The policy requires 20% of the portfolio to be invested for less than one year
and no more than 30% of the portfolio can be invested longer than two years.
The fair values of the City’s Airport Land Sales Permanent Fund fixed income investments fluctuate in
response to changes in market interest rates. Increases in prevailing interest rates generally translate into
decreases in fair values of those instruments. Fair values of interest rate sensitive instruments may be
affected by the creditworthiness of the issuer, prepayment options, relative values of alternative
investments, the liquidity of the instrument, and other general market conditions. Duration of a financial
asset measures the sensitivity of the asset’s price to changes in interest rates. The benchmark index for
the fixed income component of the fund is the Barclays Intermediate Government/Credit Index. The index
allows for maturities of 1 to 10 years. At June 30, 2015 the index had an average duration of 3.94 while
the fund’s fixed income component had an average duration of 3.874.
Concentration Risk. The City’s general investment policy places no limit on the amount that can be invested
in any one issuer. More than 5% of the total portfolio is invested in securities issued by the Federal Farm
Credit Bureau – 10.70% and Federal Home Loan Mortgage Corporation – 8.03%.
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The City’s Permanent Fund investment policy places no limits on the amount that can be invested in any
one issuer but rather establishes limits by asset class. The following is a list of asset classes allowed, their
benchmark index, their appropriate target weighting, and the actual weighting at June 30, 2015.
Asset Class Benchmark Index
Target %
Weighting
Actual %
Weighting
Fixed income Barclays Intermediate Government/Credit
Index 45-65% 43.61%
Large-Cap domestic equities Standard & Poor’s 500 Index 20-25 20.03
International equities Vanguard Europe Pacific ETF 10-15 9.94
Mid-Cap equities Standard & Poor’s 400 Mid-Cap Index 10-15 11.09
Small-Cap equities Standard & Poor’s 600 Small-Cap Index 5-10 5.84
International emerging markets Vanguard Emerging Market ETF 5-10 4.71
Real-estate equities Vanguard REIT ETF 5-10 4.78
Total 100.00%
Credit Risk. The City’s general investment policy specifies the types of investments that can be purchased.
The intent of this is to limit the credit risk, or the risk that the issuer of the investment securities purchased
will default at maturity of the investment. The City may invest only in obligations of the United States
government, its instrumentalities and agencies; insured or collateralized certificates of deposit, savings
accounts; collateralized repurchase agreements; money market funds and the State investment pool.
Credit risk is effectively limited by limiting the eligible investment options. All of the U.S. Agency securities
in the portfolio at year-end are rated Aaa by Moody’s Investors Service and AAA by Standard and Poor’s.
The Barclays Intermediate Government/Credit Index is utilized as the benchmark by the City’s Permanent
Fund investment policy, which requires investment in securities of investment grade or higher (rated Baa
or higher by Moody’s Investor Service or rated BBB or higher by Standard and Poor’s. At June 30, 2015
all fixed income investments were rated BBB or better by Standard and Poor’s.
B. Receivables
Receivables at June 30, 2015, for the City’s individual major funds and the nonmajor and other
governmental funds in the aggregate are as follows:
Water &Airport
Airport Sewer Airport Improvements Nonmajor
Special Special Land Sales Capital and Other
General Revenue Revenue Permanent Project Funds
Taxes $1,524,532 $ - $ - $ - $ - $ -
Intergovernmental 15,728 9,567 - - 178,909 512,090
Customer and other 568,050 151,740 240,194 - - 99,425
Special assessments 372,751 -----
Land contracts 19,397 -- 188,251 --
Accrued interest 10,794 - - 153,484 - 18,487
Total receivables 2,511,252 161,307 240,194 341,735 178,909 630,002
Less allowance for
uncollectible (414,554) (73,101) (26,444) - - -
Net receivables $2,096,698 $ 88,206 $213,750 $341,735 $178,909 $630,002
C. Deferred Inflows, Outflows and Unearned Revenues
Governmental funds report deferred inflows in connection with receivables for revenue that are not
considered to be available 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.
Governmental funds report acquisitions of net position by the governmental funds that are applicable to a
future reporting period as deferred inflows of resources and consumption of net position that are applicable
to a future period as deferred outflows. At June 30, 2015, the various components of unearned revenue,
40
deferred inflows of resources, and deferred outflows of resources reported at the fund level and the
government-wide level were as follows:
Fund Level Government Wide
Deferred Deferred Deferred Deferred
Outflows Inflows Unearned Outflows Inflows Unearned
Pension related $ - $ - $ - $957,327 $ - $ -
Special assessments receivable
(General Fund)- 372,751 ----
Ambulance billing receivable
(General Fund)- 95,349 ----
Land sales receivable (General Fund) - 19,397 - - - -
Land sales receivable (Airport
Land Sales Permanent Fund) - 188,251 - - - -
Prepaid property tax (General Fund) - 151,738 - - 151,738 -
Prepaid licenses (General Fund) - 2,500 - - 2,500 -
Pension related - - - - 997,234
Prepaid rents & leases (General Fund) - - 17,430 - - 17,430
Prepaid rents & leases (Airport Fund) - - 66,216 - - 66,216
Grant funds received prior to
meeting all eligibility requirements
(General Fund)-- 8,499 -- 8,499
Grant funds received prior to meeting
all eligibility requirements (Airport
Improvements Capital Project Fund) - - 3,718 - - 3,718
Grant funds received prior to
meeting all eligibility requirements
(nonmajor governmental funds) - - 43,202 - - 43,202
$ - $829,986 $139,065 $957,327 $1,151,472 $139,065
D. Capital Assets
Capital asset activity for the year ended June 30, 2015 was as follows:
Balance Balance
July 1, 2014 Increases Decreases June 30, 2015
Governmental Activities:
Capital assets not being depreciated:
Land $ 6,001,559 $ -$ - $ 6,001,559
Construction in progress 7,771,506 3,223,420 (8,643,777) 2,351,149
Total capital assets not being depreciated 13,773,065 3,223,420 (8,643,777) 8,352,708
Capital assets being depreciated:
Buildings 59,415,6005,978,009 - 65,393,609
Improvements other than buildings 54,146,730 24,187 - 54,170,917
Machinery and equipment 19,303,8571,213,292 (120,151) 20,396,998
Infrastructure 67,227,132 1,513,694 - 68,740,826
Total capital assets being depreciated 200,093,319 8,729,182 (120,151) 208,702,350
Less accumulated depreciation for:
Buildings (18,162,188) (1,137,608) - (19,299,796)
Improvements other than buildings (18,706,701) (1,456,760) - (20,163,461)
Machinery and equipment (11,180,786) (994,189) 108,286 (12,066,689)
Infrastructure (25,788,138) (826,325) - (26,614,463)
Total accumulated depreciation (73,837,813)(4,414,882) 108,286 (78,144,409)
Total capital assets being depreciated, net 126,255,506 4,314,300 (11,865) 130,557,941
Governmental activities capital assets, net$140,028,571 $ 7,537,720 $(8,655,642)$138,910,649
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The Internal Service Funds serve the governmental funds; therefore, their capital assets are included as
part of the above totals for governmental activities.
Balance Balance
July 1, 2014 Increases Decreases June 30, 2015
Business-type Activities:
Capital assets not being depreciated:
Land $ 274,500 $ -$ -$ 274,500
Construction in progress 254,059 116,826 (370,885) -
Total capital assets not being depreciated 528,559 116,826 (370,885) 274,500
Capital assets being depreciated –
Buildings 5,292,668370,885 -5,663,553
Less accumulated depreciation for –
Buildings (2,750,551) (136,137) -(2,886,688)
Total capital assets being
depreciated, net 2,542,117 234,748 - 2,776,865
Business-type activities capital assets,
net $ 3,070,676 $ 351,574 $(370,885)$ 3,051,365
Depreciation expense charged to each governmental function is as follows:
General government $ 85,157
Public safety 226,890
Public works 954,441
Park, recreation and cultural 275,866
Water and sewer services 911,146
Airport 1,908,440
Social welfare services 52,942
$4,414,882
E. Pension Plans
1.Defined Benefit Pension Plan
The City participates in the Alaska Public Employees’ Retirement System (PERS). PERS is a cost-sharing
multiple employer plan which covers eligible State and local government employees, other than teachers.
The Plan was established and is administered by the State of Alaska Department of Administration. Benefit
and contribution provisions are established by State law and may be amended only by the State Legislature.
The Plan is included in a comprehensive annual financial report that includes financial statements and other
required supplemental information. That report is available via the internet at
http://doa.alaska.gov/drb/pers. Actuarial valuation reports, audited financial statements, and other detailed
plan information are also available on this website.
The Plan provides for retirement, death and disability, and post-employment health care benefits. There
are three tiers of employees, based on entry date. For all tiers within the Defined Benefit (DB) plan, full
retirement benefits are generally calculated using a formula comprised of a multiplier times the average
monthly salary (AMS) times the number of years of service. The multiplier is increased at longevity
milestone markers for most employees. Police/Fire employees accrue benefits at an accelerated rate. The
tiers within the Plan establish differing criteria regarding normal retirement age, early retirement age, and
the criteria for calculation of AMS, COLA adjustments, and other OPEB benefits. A complete benefit
comparison chart is available at the website noted above.
42
The PERS DB Plan was closed to new entrants effective June 30, 2006. New employees hired after that
date participate in the PERS Defined Contribution (DC) Plan described later in these notes.
Historical Context and Special Funding Situation
In April 2008, the Alaska Legislature passed legislation converting the previously existing PERS plan from
an agent-multiple employer plan to a cost-sharing plan with an effective date of July 1, 2008. In connection
with this conversion, the State of Alaska passed additional legislation which statutorily capped the employer
contribution rate, established a state funded “on-behalf” contribution (subject to funding availability), and
required that employer contributions be calculated against all PERS eligible wages, including wages paid
to participants of the PERS Tier IV defined contribution plan described later in these footnotes.
Alaska Statute 39.35.255 requires the State of Alaska to contribute to the Plan an amount such that, when
combined with the employer contribution, is sufficient to pay the Plan’s past service liability contribution rate
as adopted by the Alaska Management Retirement Board.
Although current statutes call for the State of Alaska to contribute to the Plan, the Alaska Department of
Law has determined that the statute does not create a legal obligation to assume the liabilities of the Plan;
rather it establishes a contribution mechanism to provide employer relief against the rising contribution
rates. This relief payment is subject to funding availability, and therefore not legally mandated. As a result,
the State has determined that the Plan is not in a special funding situation.
Management of the City strongly disagrees with the State’s position and believes that AS 39.35.255
constitutes a special funding situation under GASB 68 rules and has recorded all pension related liabilities,
deferred inflows/outflows, and disclosures on this basis, pending a final legal determination, as may be
required to settle the matter.
The City records the on-behalf contributions as revenue and expense/expenditures in the fund financial
statements. However, the expenditures are adjusted to deferred outflows in the enterprise funds and
government-wide financial statements.
Employee Contribution Rates
Regular employees are required to contribute 6.75% of their annual covered salary (Police and firefighters
are required to contribute 7.5% of their annual covered salary.) Non-Teacher School District employees
are required to contribute 9.6% of their annual covered salary.
Employer and Other Contribution Rates
There are several contribution rates associated with the pension and healthcare contributions and related
liabilities. These amounts are calculated on an annual basis.
Employer Effective Rate: This is the contractual employer pay-in rate. Under current legislation, this rate
is statutorily capped at 22% of eligible wages, subject to a wage floor, and other termination events. This
22% rate is calculated on all PERS participating wages, including those wages attributable to employees
in the defined contribution plan. Contributions derived from the defined contribution employees are referred
to as the Defined Benefit Unfunded Liability or DBUL contribution.
ARM Board Adopted Rate: This is the rate formally adopted by the Alaska Retirement Management Board.
This rate is actuarially determined and used to calculate annual Plan funding requirements, without regard
to the statutory rate cap or the GASB accounting rate. Prior to July 1, 2015, there were no constraints or
restrictions on the actuarial cost method or other assumptions used in the ARM Board valuation. Effective
July 1, 2015, the Legislature requires the ARM Board to adopt employer contribution rates for past service
liabilities using a level percent of pay method over a closed 25 year term which ends in 2039. This will
result in lower ARM Board Rates in future years.
On-behalf Contribution Rate: This is the rate paid in by the State as an on-behalf payment under the current
statute. The statute requires the State to contribute, based on funding availability, an on-behalf amount
equal to the difference between the ARM Board Rate and the Employer Effective Rate. However, in 2015,
the State Legislature appropriated a one-time contribution to the Plan in the amount of $1 billion. As a
43
result, the On-behalf Contribution Rate for 2015 significantly exceeds the statutory amount. In the
governmental fund financial statements, on-behalf contribution amounts have been recognized as
additional revenues and expenditures. On the enterprise fund and government-wide financial statements,
the on-behalf amounts are included in revenue, but are recorded as deferred outflows, rather than pension
expense.
GASB Rate: This is the rate used to determine the long-term pension and healthcare liability for plan
accounting purposes in accordance with generally accepted accounting principles as established by GASB.
Certain actuarial methods and assumptions for this rate calculation are mandated by GASB. Additionally,
the GASB rate disregards all future Medicare Part D payments. For FY15, the rate uses an 8.00% pension
discount rate and a 4.90% healthcare discount rate.
The GASB Rate and the ARM Board Adopted Rate differ significantly as a direct result of variances in the
actuarial methods and assumptions used.
Contribution rates for the year ended June 30, 2015 were determined in the June 30, 2012 actuarial
valuation.
Employer ARM Board State
Effective Adopted ContributionGASB
Rate Rate Rate Rate
Pension 12.54% 25.09% 42.41% 33.05%
Postemployment healthcare (See
Note E-3) 9.46% 18.94% - % 55.07%
Total Contribution Rate 22.00% 44.03% 42.41% 88.12%
In 2015, the City was credited with the following contributions into the pension plan.
Measurement
Period
City FY14 City FY15
Employer contributions (including DBUL) $ 709,405 $ 780,934
Nonemployer contributions (on-behalf) 620,881 3,592,447
Total Contributions $1,330,286 $4,373,381
In addition, employee contributions to the plan totaled $311,978 during the City fiscal year.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows
of Resources Related to Pensions
At June 30, 2015, the City reported a liability for its proportionate share of the net pension liability (NPL)
that reflected a reduction for State pension support provided to the City. The amount recognized by the
City for its proportional share, the related State proportion, and the total were as follows:
2015
City proportionate share of NPL $ 8,631,519
State’s proportionate share of the City’s NPL 7,550,147
Total Net Pension Liability $16,181,666
The net pension liability was measured as of June 30, 2014, and the total pension liability used to calculate
the net pension liability was determined by an actuarial valuation as of that date. The City’s proportion of
the net pension liability was based on a projection of the City’s long-term share of contributions to the
pension plan relative to the projected contributions of all participating entities, including the State, actuarially
determined. At June 30, 2014, the City’s proportion was 0.185061380 percent, which was an increase of
0.005942800 from its proportion measured as of June 30, 2013.
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For the year ended June 30, 2015, the City recognized pension expense of $1,375,793 and on-behalf
revenue of $620,881 for support provided by the State. At June 30, 2015, the City reported deferred
outflows of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Difference between expected and actual experience $ - $ -
Changes in assumptions - -
Net difference between projected and actual earnings
on pension plan investments - 997,234
Changes in proportion and differences between City of Kenai
contributions and proportionate share of contributions 176,393 -
City contributions subsequent to the measurement
date 780,934 -
Total Deferred Outflows and Deferred Inflows
Related to pensions $957,327 $997,234
The $780,934 reported as deferred outflows of resources related to pensions resulting from contributions
subsequent to the measurement date will be recognized as a reduction in the net pension liability in the
year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows
of resources related to pensions will be recognized in pension expense as follows:
Year Ending June 30,
2016 $113,622
2017 208,603
2018 249,309
2019 249,307
Actuarial Assumptions
The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following
actuarial assumptions, applied to all periods included in the measurement, and rolled forward to the
measurement date of June 30, 2014. The actuarial valuation for the year ended June 30, 2014 (latest
available) was prepared by Buck Consultants. The actuarial assumptions used in the June 30, 2013
valuation were based on the results of an actuarial experience study for the period from July 1, 2005 to
June 30, 2009, resulting in changes in actuarial assumptions adopted by the Alaska Retirement
Management Board to better reflect expected future experience.
Inflation 3.12%
Salary Increase Graded by service, from 6.36% to 4.12% for Peace
Officers/Firefighters. Graded by age and service,
from 9.6% to 3.62% for all others.
Investment Return / Discount Rate 8.00% net of pension plan investment expenses.
This is based on an average inflation rate of 3.12%
and real rate of return over 4.88%.
Mortality Rates based on the 1994 Group Annuity Mortality
Table, sex distinct, 1994 Base year without margin
projected to 2013 using Projection Scale AA, 80% of
the male table and 60% of the female table for pre-
termination mortality for Peace officers/fire fighters.
75% for male and 55% for female for pre-termination
for all others; and 100% for males and 1-year set-
forward for females for post-termination.
45
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimate ranges of expected future real rates of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class. These ranges
are combined to produce the long-term expected rate of return by weighting the expected future real rates
of return by the target asset allocation percentage and by adding expected inflation. The best estimates of
arithmetic real rates of return for each major asset class are summarized in the following table (note that
the rates shown below exclude the inflation component:)
Long-Term
Expected Real
Asset Class Rate of Return
Domestic equity 6.77%
International equity 7.50%
Private equity 10.86%
Fixed income 2.05%
Real estate 3.63%
Absolute return 4.80%
Discount Rate
The discount rate used to measure the total pension liability was 8.00%. The projection of cash flows used
to determine the discount rate assumed that Employer and State contributions will continue to follow the
current funding policy which meets State statutes. Based on those assumptions, the pension plan's fiduciary
net position was projected to be available to make all projected future benefit payments of current plan
members. Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the total pension liability.
Discount Rate Sensitivity
The following presents the Retirement System’s net pension liability and the City’s proportionate share of
the net pension liability calculated using the discount rate of 8.00 percent, as well as what the City’s
proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-
percentage-point lower (7.00 percent) or 1-percentage-point higher (9.00 percent) than the current rate:
Current
1% Discount
Proportional Decrease Rate 1%Increase
Share (7.00%) (8.00%)(9.00%)
Systems Net Pension Liability 100.00% $6,115,581,980 $4,664,148,458 $3,441,888,494
City’s proportionate share of
the net pension liability 0.185061380% 11,317,580 8,631,519 6,369,606
Pension Plan Fiduciary Net Position
Detailed information about the pension plan’s fiduciary net position is available in the separately issued
PERS financial report.
2.Defined Contribution Pension Plan
Employees hired after July 1, 2006 participate in PERS Tier IV, a defined contribution plan. This Plan is
administered by the State of Alaska, Department of Administration in conjunction with the defined benefit plan
noted above. Benefit and contribution provisions are established by State law and may be amended only by
the State Legislature. The Alaska Retirement Management Board may also amend contribution requirements.
Included in the Plan are individual pension accounts, retiree medical insurance plan and a separate Health
Reimbursement Arrangement account that will help retired members pay medical premiums and other eligible
medical expenses not covered by the medical plan. This Plan is included in the comprehensive annual
financial report for PERS, and at the following website, as noted above. http://doa.alaska.gov/drb/pers.
46
Contributions to the DC plan consist solely of employer and employee contributions with no special funding
or other nonemployer contributions. In addition, actual remittances to the PERS system require that the
City contribute at 22%. After deducting the DC plan contributions (and related OPEB contributions), the
remaining remittance (the DBUL) is deposited into the DB plan as noted earlier.
Benefit Terms
Employees are immediately vested in their own contributions and vest 25% with two years of service, plus an
additional 25% per year thereafter for full vesting at five years of service.
Employee Contribution Rate
Employees are required to contribute 8.0% of their annual covered salary. This amount goes directly to the
individual’s account.
Employer Contribution Rate
For the year ended June 30, 2015, the City was required to contribute 5% of covered salary into the Plan.
The City and employee contributions to PERS for pensions for the year ended June 30, 2015 were $169,496
and $271,193, respectively. The City contribution amount was recognized as pension expense/expenditures.
3.Other Post Employment Benefit (OPEB) Plans
As part of its participation in the PERS DB Plan (Tiers I, II, III), the City participates in the Alaska Retiree
Healthcare Trust (ARHCT). The ARHCT is self-funded and provides major medical coverage to retirees of
the System. Benefits vary by Tier level. The Plan is administered by the State of Alaska, Department of
Administration. Employer contribution rates are established in concert with the Defined Benefit Pension
Plan described earlier in these notes.
Employer Contribution Rate
The City is required to contribute 9.46% of covered payroll into the OPEB plan. Employees do not
contribute.
Annual Postemployment Healthcare Cost
Actual contributions into the Plan for the last three years were as follows. The amounts reported here
include only the employer required contributions and do not include any amounts attributed to the on-behalf
contributions by the State. In 2015, there were no on-behalf contributions into the OPEB Plan; however,
on-behalf contributions to the OPEB Plan in 2014 and 2013 were $476,474 and $501,889, respectively.
Annual
OPEB City % of Costs
Year Ended June 30, Costs Contributions Contributed
2015 $589,138 $589,138 100%
2014 696,036 696,036 100%
2013 787,559 787,559 100%
Defined Contribution OPEB
Defined Contribution Pension Plan participants (PERS Tier IV) participate in the Occupational Death and
Disability Plan (ODD), and the Retiree Medical Plan. Information on these plans is included in the
comprehensive annual financial report for the PERS Plan noted above. These plans provide for death,
disability, and post-employment health care benefits.
Employer Contribution Rates
Employees do not contribute to the DC OPEB plans. Employer contribution rates for the year ended June
30, 2015 were as follows:
Other Police/Fire
Tier IV Tier IV
Retiree medical plan 1.66% 1.66%
Occupational death and disability benefits 0.22% 1.06%
1.88%2.72%
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In addition, PERS defined contribution members also participate in the Health Reimbursement Arrangement.
AS 39.30.370 establishes this contribution amount as “three percent of the average annual employee
compensation of all employees of all employers in the plan”. As of July 1, 2014, for actual remittance, this
amount is calculated as a flat rate for each full time or part-time employee per pay period and approximates
$1,961 per year for each full-time employee, and $1.26 per hour for part-time employees.
Annual Postemployment Healthcare Cost
In 2015, the City contributed $177,763 in DC OPEB costs. These amounts have been recognized as
expense/expenditures.
F. Changes in Long-Term Obligations
Activity in long-term liabilities in governmental activities is as follows:
Balance Balance Due within
July 1, 2014 Additions Reductions June 30, 2015 one year
Compensated absences $ 820,285 $892,716 $ 884,036 $ 828,965 $207,241
Pension liability 9,406,230 - 774,711 8,631,519 -
Library expansion bonds 1,695,000 - 80,000 1,615,000 85,000
Total governmental activities $11,921,515 $892,716 $1,738,747 $11,075,484 $292,241
Activity in long-term liabilities in business-type activities is as follows:
Balance Balance Due within
July 1, 2014 Additions Reductions June 30, 2015 one year
Compensated absences $2,455 $4,300 $3,907 $2,848 $712
The City of Kenai has issued general obligation bonds for the expansion of the Kenai Community Library.
The general obligation bonds pledge the full faith and credit of the City. Bonds in the amount of $2,000,000
were issued on March 11, 2010. $1,355,000 of the total was issued under the American Recovery and
Reinvestment Act (ARRA) Recovery Zone Economic Development Bond Program and the remaining
$645,000 were issued utilizing traditional tax exempt bonds.
A summary of bonds payable (in thousands) at June 30, 2015, is as follows:
Federal Federal
Date of Interest Interest Maturity Annual Interest Net Outstanding
Issue Issued Rate Subsidy Dates Installments Subsidy Installments June 30, 2015
3/11/10 $1,355 5.99 - 6.34 2.70 - 2.85 2019 - 2030 $81 - $175 $4 - $38 $77 - $137 $1,355
3/11/10 645 2.00 - 5.00 - 2012 - 2018 92 - 95 - 92 - 95 260
$2,000 $1,615
Debt service requirements (not including compensated absences) at June 30, 2015 are as follows:
Governmental Activities
Interest Net
Fiscal Year Principal Interest Subsidy Interest
2016 $ 85,000 $ 93,798 $ 37,529 $ 56,269
2017 85,000 90,398 37,529 52,869
2018 90,000 86,998 37,529 49,469
2019 95,000 83,398 37,529 45,869
2020 95,000 77,704 34,967 42,737
2021-2025 535,000 298,027 134,112 163,915
2026-2030 630,000 122,381 55,072 67,309
Total $1,615,000 $852,704 $374,267 $478,437
48
Remaining unissued are $2,000,000 in general obligation bonds authorized by City voters for the City’s
Kenai River Bluff Erosion Project.
The City has a legal debt limit equal to twenty percent of the assessed value of all real and personal property
in the City. The 2014 Certified Main and Supplemental Tax Roles for the City showed total taxable
assessed for real and personal property of $828,384,580, making the legal debt limit $165,676,916 for the
City.
G. Interfund Receivables, Payables and Transfers
Amounts due from other funds are as follows:
Due to General Fund from:
Streets Capital Project Fund for short-term capital advances $10,630
Kenai Industrial Park Capital Project Fund for short-term capital advances 20,000
Total amounts due from other funds $30,630
Transfers between funds were as follows:
From General Fund to:
Nonmajor governmental funds for capital costs $ 432,000
Nonmajor governmental funds for debt service 141,390
Internal service fund to close fund 97,004
From Airport Special Revenue Fund to:
Airport Improvements Capital Project Fund for capital costs 215,338
From Water & Sewer Special Revenue Fund to:
Nonmajor governmental funds for capital costs 251,232
From Airport Land Sales Permanent Fund to:
Airport Special Revenue Fund for operating costs 1,135,313
From nonmajor governmental funds to:
General Fund to close fund 11
General Fund for operating costs 147,093
Total transfers to other funds $2,419,381
H. Fund Balance Designations
Pursuant to GASB Statement Number 54, fund balances reported for the major funds and the nonmajor
funds in the aggregate on the governmental funds balance sheet are subject to the following constraints:
Airport Water & Airport Airport Nonmajor
Special Sewer Land Sales Improvements and
General Revenue Special Rev. Permanent Capital Proj. Other Funds Totals
Nonspendable –
Permanent funds $ - $- $- $23,711,029 $ - $2,888,444 $26,599,473
Restricted –Athletics 546,706 - - - - - 546,706
Committed:
Capital Imp. 9,746 - - - 109,013 792,285 911,044
Working capital 400,000 - - - - - 400,000
Total committed 409,746 - - - 109,013 792,285 1,311,044
Assigned:
Self-Insurance 103,475 - ---- 103,475
Compensated abs. 717,316 49,592 35,127 - - 26,930 828,965
Subsequent years
expenditures 676,965 - - - - 70,146 747,111
Airport operations - 4,184,947 ---- 4,184,947
Water & sewer
operations - - 1,153,886 - - - 1,153,886
Personal use fishery
operations - - - - - 63,948 63,948
49
Assigned continued:
Senior programs - - - - - 63,704 63,704
Total assigned 1,497,756 4,234,539 1,189,013 - - 224,728 7,146,036
Unassigned 7,937,025 - - - - - 7,937,025
Total fund balances $10,391,233 $4,234,539 $1,189,013 $23,711,029 $109,013 $3,905,457 $43,540,284
I. Change in Accounting Principle
As discussed in Note E to the financial statements, the City participates in the Alaska Public Employees
Retirement System (PERS) plan. In 2015 the City adopted the provisions of GASB Statement No. 68
Accounting and Financial Reporting for Pensions, which, among other accounting and reporting criteria,
requires the City to recognize its proportional share of the Net Pension Liability (and related deferred
inflow/outflow accounts), as of the beginning of the City’s fiscal year. As a result of the implementation of
this statement, the City has recorded an opening balance adjustment to reflect opening balance pension
liabilities and related accounts and to decrease opening net position as follows:
Opening Change in
net position accounting Opening
as originally principle net position
presented adjustment as restated
Governmental Activities $182,783,335 $(8,696,825) $174,086,510
J. Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; environmental contamination; and natural disasters. Risk
financing activities are accounted for in various operating funds, with unallocated or Citywide activities being
accounted for in the General Fund. The City purchases commercial insurance to transfer a substantial
portion of the above risks of loss. Property insurance is purchased to provide coverage for buildings and
heavy equipment, generally with deductibles of $25,000. Various liability insurance policies are purchased
to provide protection against torts, injuries, and errors and omissions. Most liability policies are written with
low or zero deductibles. In addition to the deductibles on insurance policies, the City retains risk of loss
related to certain potential liabilities and property damages. These include environmental liabilities,
employment discrimination, and vehicle property losses. Settled claims have not exceeded commercial
coverage in any of the past three fiscal years. The City analyzes potential losses on a case-by-case basis
to determine amounts that should be accrued or disclosed in the financial statements.
K. Contingencies
The City is involved in several lawsuits arising in the ordinary course of operations, including actions
commenced and claims asserted against it. Management of the City does not believe that the ultimate
resolution of these lawsuits and claims will have any material effect on its financial position or results of
operations, and therefore, no provision has been made in the accompanying financial statements.
L. New Accounting Pronouncements
The Governmental Accounting Standards Board has passed several new accounting standards with
upcoming implementation dates as follows. The statements are being reviewed by management for
potential financial reporting impacts.
GASB 72 – Fair Value Measurement and Application – Effective for year-end June 30, 2016 – This
statement addresses accounting and financial reporting issues related to fair value measurements. The
definition of fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date. This Statement provides
guidance for determining a fair value measurement for financial reporting purposes. This Statement also
provides guidance for applying fair value to certain investments and disclosures related to all fair value
measurements.
50
GASB 73 – Accounting and Financial Reporting for Pension and Related Assets That Are Not within the
Scope of GASB Statement 68, and Amendments to Certain Provisions of GASB Statement 67 and 68 –
Effective for year-end June 30, 2016 – The objective of this Statement is to improve the usefulness of
information about pensions included in the general purpose external financial reports of state and local
governments for making decisions and assessing accountability.
GASB 74 – Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans – Effective
for year-end June 30, 2017 - The objective of this Statement is to improve the usefulness of information
about postemployment benefits other than pensions (other postemployment benefits or OPEB) included in
the general purpose external financial reports of state and local governmental OPEB plans for making
decisions and assessing accountability.
GASB 75 – Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions
– Effective for year-end June 30, 2018 - The primary objective of this Statement is to improve accounting
and financial reporting by state and local governments for postemployment benefits other than pensions
(other postemployment benefits or OPEB). It also improves information provided by state and local
governmental employers about financial support for OPEB that is provided by other entities.
GASB 76 – The Hierarchy of Generally Accepted Accounting Principles for State and Local Governments
–Effective for year ended June 30, 2016 - The objective of this Statement is to identify—in the context of
the current governmental financial reporting environment—the hierarchy of generally accepted accounting
principles (GAAP). The “GAAP hierarchy” consists of the sources of accounting principles used to prepare
financial statements of state and local governmental entities in conformity with GAAP and the framework
for selecting those principles. This Statement reduces the GAAP hierarchy to two categories of authoritative
GAAP and addresses the use of authoritative and nonauthoritative literature in the event that the accounting
treatment for a transaction or other event is not specified within a source of authoritative GAAP.
This Statement supersedes Statement No. 55, The Hierarchy of Generally Accepted Accounting Principles
for State and Local Governments.
GASB 77 – Tax Abatement Disclosures – Effective for year ended June 30, 2017 – The objective of this
Statement is to provide the financial statement users needed information about certain limitations on a
government’s ability to raise resources. This includes limitations on revenue-raising capacity resulting from
government programs that use tax abatements to induce behavior by individuals and entities that is
beneficial to the government or its citizens. Tax abatements are widely used by state and local
governments, particularly to encourage economic development. For financial reporting purposes, this
Statement defines a tax abatement as resulting from an agreement between a government and an
individual or entity in which the government promises to forgo tax revenues and the individual or entity
promises to subsequently take a specific action that contributes to economic development or otherwise
benefits the government or its citizens.
51
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52
REQUIRED SUPPLEMENTARY INFORMATION
OriginalFinal Variance With
Budget Budget Actual Final Budget
Revenues:
Taxes:
General property3,654,586$ 3,654,586$ 3,647,001$ (7,585)$
General sales6,831,362 6,831,362 7,257,451 426,089
Penalty and interest on taxes10,000 10,000 9,926 (74)
Total taxes10,495,948 10,495,948 10,914,378 418,430
Intergovernmental revenues:
Federal grants-8,732 12,349 3,617
Kenai Peninsula Borough 51,360 51,360 51,840 480
State of Alaska shared revenues:
Electric utility tax 33,000 33,000 32,038 (962)
Fish tax 200,000 200,000 292,718 92,718
Liquor licenses 25,000 25,000 26,950 1,950
Revenue sharing 433,538 433,538 441,046 7,508
State of Alaska grants:
Library grants -7,971 7,971 -
Fire grants -1,750 1,750 -
PERS relief 1,457,847 3,225,203 2,977,564 (247,639)
Total intergovernmental revenues2,200,745 3,986,554 3,844,226 (142,328)
Charges for services:
Fees and charges:
Ambulance fees400,000 400,000 412,509 12,509
Multipurpose facility charges105,000 105,000 104,417 (583)
Administrative and service fees 1,548,800 1,548,800 1,542,786 (6,014)
Other 15,500 15,500 11,419 (4,081)
Total fees and charges2,069,300 2,069,300 2,071,131 1,831
Licenses and permits:
Building permits65,000 65,000 62,283 (2,717)
Animal control licenses and fees29,500 29,500 24,346 (5,154)
Other6,000 6,000 6,166 166
Total licenses and permits100,500 100,500 92,795 (7,705)
Fines and forfeits:
Court fines60,000 60,000 51,959 (8,041)
Library fines15,000 15,000 10,671 (4,329)
Other forfeitures26,000 27,585 23,317 (4,268)
Total fines and forfeits101,000 102,585 85,947 (16,638)
Total charges for services2,270,800 2,272,385 2,249,873 (22,512)
CITY OF KENAI, ALASKA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015
See accompanying independent auditor's report and notes to required supplementary information.
53
OriginalFinal Variance With
Budget Budget Actual Final Budget
Revenues, continued:
Interest earnings75,000$ 75,000$ 56,992$ (18,008)$
Miscellaneous revenues:
Rents and leases127,290 127,290 129,199 1,909
Oil and gas royalties65,000 65,000 63,692 (1,308)
Special assessments66,000 66,000 59,468 (6,532)
Other95,285 131,213 109,649 (21,564)
Total miscellaneous revenues353,575 389,503 362,008 (27,495)
Total revenues15,396,068 17,219,390 17,427,477 208,087
Expenditures:
General government:
Legislative:
Personal services51,814 51,814 52,096 (282)
Supplies5,798 6,140 3,315 2,825
Other services and charges117,528 108,786 95,902 12,884
Total legislative175,140 166,740 151,313 15,427
City clerk:
Personal services179,224 167,917 154,611 13,306
Supplies23,425 27,459 24,734 2,725
Other services and charges57,820 57,593 38,128 19,465
Total city clerk260,469 252,969 217,473 35,496
City attorney:
Personal services267,622 267,622 265,004 2,618
Supplies2,930 2,930 2,202 728
Other services and charges105,255 105,255 92,558 12,697
Total city attorney375,807 375,807 359,764 16,043
City manager:
Personal services303,947 303,947 294,950 8,997
Supplies3,510 3,510 2,369 1,141
Other services and charges66,029 119,209 62,864 56,345
Total city manager373,486 426,666 360,183 66,483
CITY OF KENAI, ALASKA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
See accompanying independent auditor's report and notes to required supplementary information.
54
OriginalFinal Variance With
Budget Budget Actual Final Budget
Expenditures, continued:
General government, continued:
Finance:
Personal services564,364$ 560,864$ 550,966$ 9,898$
Supplies37,690 34,490 26,177 8,313
Other services and charges31,335 31,235 19,940 11,295
Total finance633,389 626,589 597,083 29,506
Non-departmental:
Personal services1,457,847 3,225,203 2,977,563 247,640
Supplies9,500 12,700 10,880 1,820
Other services and charges399,919 346,739 260,990 85,749
Total non-departmental1,867,266 3,584,642 3,249,433 335,209
Planning and zoning:
Personal services184,224 186,824 172,615 14,209
Supplies8,150 8,150 5,701 2,449
Other services and charges41,585 40,585 27,527 13,058
Total planning and zoning233,959 235,559 205,843 29,716
Safety:
Supplies1,250 2,250 997 1,253
Other services and charges31,350 31,350 14,325 17,025
Total safety32,600 33,600 15,322 18,278
Land administration:
Supplies1,020 1,020 455 565
Other services and charges25,460 24,760 6,389 18,371
Capital outlays- 32,485 15,054 17,431
Total land administration26,480 58,265 21,898 36,367
Total general government 3,978,596 5,760,837 5,178,312 582,525
Public safety:
Police:
Personal services2,606,299 2,597,799 2,459,996 137,803
Supplies109,837 109,370 95,906 13,464
Other services and charges167,609 171,499 156,211 15,288
Capital outlays80,520 78,770 78,688 82
Total police2,964,265 2,957,438 2,790,801 166,637
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
CITY OF KENAI, ALASKA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES,
See accompanying independent auditor's report and notes to required supplementary information.
55
OriginalFinal Variance With
Budget Budget Actual Final Budget
Expenditures, continued:
Public safety, continued:
Fire:
Personal services2,581,608$ 2,603,938$ 2,536,410$ 67,528$
Supplies121,840 120,959 112,877 8,082
Other services and charges289,817 291,569 262,042 29,527
Capital outlays101,096 104,066 103,716 350
Total fire3,094,361 3,120,532 3,015,045 105,487
Communications:
Personal services764,430 750,430 689,694 60,736
Supplies15,020 15,134 12,834 2,300
Other services and charges42,397 42,183 32,109 10,074
Total communications821,847 807,747 734,637 73,110
Animal control:
Personal services243,822 243,822 234,339 9,483
Supplies27,355 27,280 19,941 7,339
Other services and charges85,047 85,447 81,567 3,880
Total animal control356,224 356,549 335,847 20,702
Total public safety 7,236,697 7,242,266 6,876,330 365,936
Public works:
Public works administration:
Personal services171,352 171,352 170,219 1,133
Supplies4,050 4,050 2,688 1,362
Other services and charges4,550 4,550 2,812 1,738
Total public works administration179,952 179,952 175,719 4,233
Shop:
Personal services363,366 363,366 313,619 49,747
Supplies226,922 212,222 177,751 34,471
Other services and charges119,003 147,503 133,989 13,514
Capital outlays- 10,500 10,496 4
Total shop709,291 733,591 635,855 97,736
Streets:
Personal services576,822 576,422 526,106 50,316
Supplies166,530 165,877 148,155 17,722
Other services and charges231,587 232,240 217,514 14,726
Capital outlays13,600 13,600 9,768 3,832
Total streets988,539 988,139 901,543 86,596
BUDGET AND ACTUAL, continued
CITY OF KENAI, ALASKA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
See accompanying independent auditor's report and notes to required supplementary information.
56
OriginalFinal Variance With
Budget Budget Actual Final Budget
Expenditures, continued:
Public works, continued:
Dock:
Personal services43,915$ 43,915$ 45,031$ (1,116)$
Supplies20,200 24,950 16,087 8,863
Other services and charges39,749 39,749 23,297 16,452
Total dock103,864 108,614 84,415 24,199
Buildings:
Personal services243,215 251,215 238,880 12,335
Supplies45,010 45,021 37,958 7,063
Other services and charges56,700 56,550 39,622 16,928
Capital outlays218,898 110,398 94,849 15,549
Total buildings 563,823 463,184 411,309 51,875
Street lighting:
Supplies5,000 5,000 3,778 1,222
Other services and charges148,386 148,386 141,312 7,074
Total street lighting153,386 153,386 145,090 8,296
Total public works 2,698,855 2,626,866 2,353,931 272,935
Parks, recreation, and cultural:
Library:
Personal services602,084 629,084 589,562 39,522
Supplies26,223 27,132 24,138 2,994
Other services and charges228,365 241,827 230,052 11,775
Total library856,672 898,043 843,752 54,291
Visitors center:
Supplies1,500 1,500 586 914
Other services and charges 182,113 182,713 178,444 4,269
Total visitors center183,613 184,213 179,030 5,183
Parks, recreation & beautification:
Personal services436,021 460,021 431,802 28,219
Supplies116,659 118,244 103,863 14,381
Other services and charges427,046 433,596 429,060 4,536
Capital outlays33,900 33,900 18,900 15,000
Total parks, recreation & beautification1,013,626 1,045,761 983,625 62,136
Total parks, recreation, and cultural 2,053,911 2,128,017 2,006,407 121,610
Total expenditures15,968,059 17,757,986 16,414,980 1,343,006
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
CITY OF KENAI, ALASKA
See accompanying independent auditor's report and notes to required supplementary information.
57
OriginalFinal Variance With
Budget Budget Actual Final Budget
Excess of revenues over (under)
expenditures (571,991)$ (538,596)$ 1,012,497$ 1,551,093$
Other financing sources (uses):
Transfers in140,134 140,134 147,104 6,970
Transfers out(454,334) (673,338) (670,394) 2,944
Net other financing sources (uses)(314,200) (533,204) (523,290) 9,914
Net changes in fund balance(886,191)$ (1,071,800)$ 489,207 1,561,007$
Fund balance - July 1 9,902,026
Fund balance - June 3010,391,233$
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
CITY OF KENAI, ALASKA
GENERAL FUND
See accompanying independent auditor's report and notes to required supplementary information.
58
OriginalFinal Variance With
Budget Budget Actual Final Budget
Revenues:
Intergovernmental revenues - State grant 121,567$ 206,739$ 225,082$ 18,343$
Charge for services - landing fees346,427 346,427 369,824 23,397
Investment earnings29,266 29,266 22,445 (6,821)
Miscellaneous revenues:
Rents and leases, including
penalty and interest1,042,623 1,042,623 1,010,913 (31,710)
Parking fees 336,000 336,000 272,698 (63,302)
Car rental commissions 195,000 195,000 193,011 (1,989)
Advertising commissions 3,500 3,500 4,852 1,352
Fuel flowage 30,000 30,000 37,546 7,546
Other 36,500 36,500 52,810 16,310
Total miscellaneous revenues 1,643,623 1,643,623 1,571,830 (71,793)
Total revenues2,140,883 2,226,055 2,189,181 (36,874)
Expenditures:
Maintenance and operation:
Personal services376,226 409,563 394,897 14,666
Supplies 181,605 183,238 145,248 37,990
Other services and charges 328,594 330,651 316,822 13,829
Capital outlays 65,000 61,800 3,247 58,553
951,425 985,252 860,214 125,038
Expenditures chargeable from
other funds 845,600 845,600 845,600 -
Total maintenance and operation 1,797,025 1,830,852 1,705,814 125,038
Administration:
Personal services236,658 270,128 268,914 1,214
Supplies 3,900 3,900 3,129 771
Other services and charges 38,416 30,926 22,498 8,428
278,974 304,954 294,541 10,413
Expenditures chargeable from
other funds 54,300 54,300 54,300 -
Total administration 333,274 359,254 348,841 10,413
YEAR ENDED JUNE 30, 2015
CITY OF KENAI, ALASKA
AIRPORT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
See accompanying independent auditor's report and notes to required supplementary information.
59
OriginalFinal Variance With
Expenditures, continued:Budget Budget Actual Final Budget
Land:
Personal services78,646$ 86,467$ 81,990$ 4,477$
Supplies19,940 19,940 13,977 5,963
Other services and charges 98,382 97,882 77,472 20,410
Total land 196,968 204,289 173,439 30,850
Training facility -
Other services and charges38,450 38,450 34,011 4,439
Capital outlays 16,000 16,000 -16,000
Total training facility 54,450 54,450 34,011 20,439
Terminal:
Personal services183,616 202,160 194,144 8,016
Supplies 28,500 28,500 23,084 5,416
Other services and charges 378,418 373,268 310,042 63,226
Capital outlays 17,500 22,150 22,150 -
608,034 626,078 549,420 76,658
Expenditures chargeable from
other funds 73,900 73,900 73,900 -
Total terminal 681,934 699,978 623,320 76,658
Total expenditures3,063,651 3,148,823 2,885,425 263,398
Excess of revenues over (under)
expenditures (922,768) (922,768) (696,244) 226,524
Other financing sources (uses):
Transfers in1,147,095 1,147,095 1,135,313 (11,782)
Transfers out (125,000) (215,338) (215,338) -
Net other financing sources (uses)1,022,095 931,757 919,975 (11,782)
Net changes in fund balance99,327$ 8,989$ 223,731 214,742$
Fund balance - July 1 4,010,808
Fund balance - June 304,234,539$
CITY OF KENAI, ALASKA
AIRPORT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
See accompanying independent auditor's report and notes to required supplementary information.
60
CITY OF KENAI, ALASKA
WATER AND SEWER SPECIAL REVENUE FUND
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015
OriginalFinal Variance With
Budget Budget Actual Final Budget
Revenues:
Intergovernmental revenues -
State grant124,642$ 229,933$ 255,777$ 25,844$
Charges for services:
Residential water643,906$ 643,906 654,383 10,477
Commercial water 282,362 282,362 256,492 (25,870)
Residential sewer 1,108,529 1,108,529 1,109,172 643
Commercial sewer 473,595 473,595 411,520 (62,075)
Hook-up fees 8,000 8,000 9,827 1,827
Other 40,000 40,000 41,987 1,987
Total charges for services2,556,392 2,556,392 2,483,381 (73,011)
Investment earnings11,159 11,159 8,391 (2,768)
Miscellaneous revenues 3,000 3,000 2,207 (793)
Total revenues2,695,193 2,800,484 2,749,756 (50,728)
Expenditures - water and sewer services:
Water:
Personal services283,290 315,419 320,543 (5,124)
Supplies 181,020 181,020 157,205 23,815
Other services and charges 304,998 303,966 321,880 (17,914)
Capital outlays 11,325 11,325 11,225 100
780,633 811,730 810,853 877
Expenditures chargeable from
other funds 95,600 95,600 95,600 -
Total water876,233 907,330 906,453 877
Sewer:
Personal services280,647 313,171 312,354 817
Supplies 31,880 31,880 26,163 5,717
Other services and charges 97,468 97,468 59,979 37,489
Capital outlays 23,625 23,625 23,335 290
433,620 466,144 421,831 44,313
Expenditures chargeable from
other funds 56,200 56,200 56,200 -
Total sewer489,820 522,344 478,031 44,313
SCHEDULE OF REVENUES, EXPENDITURES,
See accompanying independent auditor's report and notes to required supplementary information.
61
CITY OF KENAI, ALASKA
WATER AND SEWER SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
OriginalFinalVariance With
Expenditures - continued:Budget Budget Actual Final Budget
Sewer treatment plant:
Personal services412,132$ 456,270$ 443,947$ 12,323$
Supplies132,490 130,160 93,954 36,206
Other services and charges 439,946 439,076 419,715 19,361
Capital outlays 6,500 6,500 4,300 2,200
991,068 1,032,006 961,916 70,090
Expenditures chargeable from
other funds 112,100 112,100 112,100 -
Total sewer treatment plant1,103,168 1,144,106 1,074,016 70,090
Total expenditures2,469,221 2,573,780 2,458,500 115,280
Excess of revenues over expenditures225,972 226,704 291,256 64,552
Other financing uses -
Transfers out(250,500) (251,232) (251,232) -
Net changes in fund balance(24,528)$ (24,528)$ 40,024 64,552$
Fund balance - July 11,148,989
Fund balance - June 301,189,013$
See accompanying independent auditor's report and notes to required supplementary information.
62
City's proportion of the net pension liability 0.18506138%
City's proportionate share of the net pension liability 8,631,519$
State of Alaska proportionate share of the net pension liability 7,550,147
Total net pension liability 16,181,666$
City's covered-employee payroll 4,739,928$
City’s proportionate share of the net pension liability as a percentage
of covered-employee payroll 182.00%
Plan fiduciary net position as a percentage of the total pension liability62.37%
CITY OF KENAI, ALASKA
SCHEDULE OF THE CITY'S INFORMATION ON THE NET PENSION LIABILITY
PUBLIC EMPLOYEES RETIREMENT SYSTEM
Year Ended June 30, 2015
See accompanying independent auditor's report and notes to required supplementary information.
63
Contractually required contributions 780,934$
Contributions in relation to the contractually required contributions780,934
Contribution deficiency (excess)-$
City's covered-employee payroll 4,415,909$
Contributions as a percentage of covered-employee payroll 17.685%
CITY OF KENAI, ALASKA
SCHEDULE OF THE CITY CONTRIBUTIONS
PUBLIC EMPLOYEES RETIREMENT SYSTEM
Year Ended June 30, 2015
See accompanying independent auditor's report and notes to required supplementary information.
64
FOOTNOTES TO REQUIRED SUPPLEMENTARY INFORMATION
CITY OF KENAI, ALASKA
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
JUNE 30, 2015
I. BUDGETARY COMPARISON SCHEDULES
Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the
United States of America for all governmental fund types, except the Capital Project Funds which adopt
project-length budgets. All annual appropriations lapse at a fiscal year end.
Budgets for the general fund, special revenue funds, debt service funds, permanent funds and enterprise
funds are annual budgets. Capital project fund budgets are project-length budgets. The Equipment
Replacement Fund, which is an internal service fund, is not required to have a budget. The City Council
approves all asset acquisitions from this fund by resolution.
Annual budgets must be submitted to the City Council by the City Manager during or prior to the sixth week
preceding the first day of each fiscal year. The City Council must adopt an annual budget and set the tax
rates not later than the tenth day of June for the following fiscal year.
Budgetary control (the level at which expenditures may not exceed budget) is maintained at the object class
level by the encumbrance of estimated purchase amounts prior to the release of purchase orders to
vendors. Purchase orders which would result in an overrun of object class balances are not released until
additional appropriations are made available.
Amendments to appropriations may be made by the city administration by transfers within a fund in amounts
less than $5,000. Amendments within a fund in excess of $5,000 may be made by the City Council with
the passage of a resolution. All new appropriations are authorized by an appropriating ordinance that
amends the annual budget.
Encumbrance accounting is employed in governmental funds. Encumbrances (e.g., purchase orders,
contracts) outstanding at year-end are reported as appropriate constraints of fund balances if they meet
the definitions and criteria as outlined in Note I-7. These commitments will be reappropriated and honored
during the subsequent year.
II.SCHEDULE OF THE CITY’S INFORMATION ON THE NET PENSION LIABILITY
This table is presented based on the Plan measurement date. For June 30, 2015, the Plan measurement
date is June 30, 2014.
III.SCHEDULE OF CITY CONTRIBUTIONS – PUBLIC EMPLOYEES RETIREMENT SYSTEM
This table is based on the City’s contributions during fiscal year 2015. These contributions are reported as
a deferred outflow on the June 30, 2015 basic financial statements.
Both pension tables are intended to present 10 years of information. Additional years’ information will be
added to the schedules as it becomes available.
There were no benefit changes in benefit terms from the prior measurement period.
There were no changes in assumptions from the prior measurement period.
65
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66
Other Governmental Funds
This section includes the Schedule of Revenues, Expenditures, and Changes in Fund Balance, Budget and Actual, for
the Airport Land Sales Permanent Fund, which is a major fund, as well as the Nonmajor Governmental Funds Combining
Balance Sheet and Combining Statement of Revenues, Expenditures, and Changes in Fund Balances. It also includes
a Schedule of Revenues, Expenditures, and Changes in Fund Balance, Budget and Actual for each nonmajor
governmental fund that adopted an annual budget.
Special Revenue Funds
Special Revenue funds are used for specific revenues that are legally restricted to expenditures for a specific purpose.
Personal Use Fishery Fund – This fund accounts for the activities responding to the State of Alaska Personal Use
Fishery where thousands of Alaskans harvest salmon at the mouth of the Kenai River. The primary source of revenue is
from user fees. Activities include public safety, parks, recreation and culture, and public works.
Council On Aging Fund - This fund accounts for the activities of the Senior Citizen Title III Grant Program which is
substantially financed by intergovernmental revenues. Activities include social services and a nutrition program.
Capital Project Funds
Capital Project Funds are established to account for the resources expended to acquire assets of a relatively permanent
nature. These funds evolved from the need for special accounting for bond proceeds, grants and contributions for the
acquisition of capital assets. Capital Project Funds provide a formal mechanism which enables administrators to ensure
that revenues dedicated to a certain purpose are used only for that purpose and further enables them to report to creditors
and other grantors of capital projects fund revenue, that their requirements regarding the use of the revenue were fully
satisfied.
Parks and Recreation - to account for capital improvements to City parks and recreation facilities. Financing is primarily
from General Fund transfers and State grants.
Streets – to account for capital improvements to City streets, sidewalks, curbs and gutters, or street lighting
systems. Financing is primarily by State grants and transfers from the General Fund.
New City Shop Construction – to account for the project to construct a new heavy equipment warm storage facility.
Financing is by State grants.
Water & Sewer – to account for capital improvements to the City’s water and sewer system. Financing is primarily by
Federal and State grants and transfers from the Water and Sewer Special Revenue Fund.
Miscellaneous - to account for capital projects which do not fit in one of the other fund categories. These projects are
generally smaller projects, which may be funded through transfers from other funds or by State or Federal grants.
Kenai Industrial Park – to account for the project to construct the Kenai Industrial Park. Primary funding sources are
state grants.
Library Expansion – to account for the project to expand the Kenai Community Library.
Debt Service Fund
The Debt Service Fund is used to accumulate monies for payment of general obligation bonds issued for construction,
improvements, and equipping public facilities throughout the City.
Permanent Funds
Permanent Funds are used to report resources that are legally restricted to the extent that only earnings, and not principal,
may be used.
General Government Land Sales - to account for the proceeds of general government land sales, including principal
and interest on long-term notes. By City Charter, the principal cannot be spent. Interest revenue is transferred to the
General Fund in the amount of 5% of the funds balance or calendar year actual earnings as measured at December 31st
of each year.
Airport Land Sales - to account for the proceeds of airport land sales, including principal and interest on long-term notes.
By ordinance, 5% of the calendar year end five year average balance is transferred to the Airport Special Revenue Fund
for operations. Note that this is a major fund and is therefore not included in the NonMajor Governmental Funds
Combining Statements.
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67
PersonalCouncil
UseonParks and
ASSETSFisheryAgingRecreationStreets
Equity in central treasury (cash and investments)71,980$ 94,672$ 307,517$ -$
Intergovernmental receivables - 11,741 44,766 118,626
Other accounts receivable, net - 99,425 --
Total assets71,980$ 205,838$ 352,283$ 118,626$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable4,318$ 21,721$ 188,639$ 106,496$
Accrued payroll and payroll liabilities- 9,935 - -
Other liabilities - 17,116 - -
Due to General Fund - - - 10,630
Unearned revenue ----
Total liabilities4,318 48,772 188,639 117,126
Fund balances:
Nonspendable- - - -
Committed - - 163,644 1,500
Assigned 67,662 157,066 --
Total fund balances67,662 157,066 163,644 1,500
Total liabilities and fund balances71,980$ 205,838$ 352,283$ 118,626$
CITY OF KENAI, ALASKA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
June 30, 2015
Special RevenueCapital Project
68
Debt ServicePermanent
Total
WaterGeneralNonmajor
New City Shopand Industrial2010 BondGovernmentGovernmental
ConstructionSewerMiscellaneousParkDebt ServiceLand SalesFunds
30,041$ 428,285$ 117,918$ -$ -$ 2,871,252$ 3,921,665$
4,113 298,705 14,139 20,000 - - 512,090
--- - -18,487 117,912
34,154$ 726,990$ 132,057$ 20,000$ -$ 2,889,739$ 4,551,667$
28,200$ 185,398$ 9,260$ -$ -$ 1,295$ 545,327$
- - - - - - 9,935
- - - - - - 17,116
- - - 20,000 - - 30,630
-43,202 - - - -43,202
28,200 228,600 9,260 20,000 -1,295 646,210
- - - - - 2,888,444 2,888,444
5,954 498,390 122,797 - - - 792,285
--- - - -224,728
5,954 498,390 122,797 - - 2,888,444 3,905,457
34,154$ 726,990$ 132,057$ 20,000$ -$ 2,889,739$ 4,551,667$
Capital Project
69
PersonalCouncil
UseonParks andNew City Shop
FisheryAgingRecreationStreetsConstruction
Revenues:
Intergovernmental revenues17,437$ 435,929$ 150,009$ 193,827$ 97,823$
Charges for services 532,511 - - - -
Investment earnings 680 - - - -
Miscellaneous revenues - 425,315 20,875 - -
Total revenues550,628 861,244 170,884 193,827 97,823
Expenditures:
General government- - - - -
Public safety 122,473 - - - -
Water and sewer services - - - - -
Airport - - - - -
Social welfare services - 964,287 - - -
Parks, recreation and cultural 244,514 - 432,170 - -
Public works 145,042 - - 252,327 196,888
Debt service:
Principal - - - - -
Interest - - - - -
Total expenditures512,029 964,287 432,170 252,327 196,888
Excess of revenues over (under) expenditures 38,599 (103,043) (261,286) (58,500) (99,065)
Other financing sources (uses):
Transfers in - - 250,000 60,000 -
Transfers out - - - - -
Net other financing sources (uses)- - 250,000 60,000 -
Net changes in fund balances38,599 (103,043) (11,286) 1,500 (99,065)
Fund balances - July 1 29,063 260,109 174,930 -105,019
Fund balances - June 3067,662$ 157,066$ 163,644$ 1,500$ 5,954$
YEAR ENDED JUNE 30, 2015
COMBINING STATEMENT OF REVENUES, EXPENDITURES
Special RevenueCapital Project
CITY OF KENAI, ALASKA
NONMAJOR GOVERNMENTAL FUNDS
AND CHANGES IN FUND BALANCES
70
Debt ServicePermanent
Total
Water GeneralNonmajor
andIndustrialLibrary2010 BondGovernmentGovernmental
SewerMiscellaneousParkExpansionDebt ServiceLand SalesFunds
630,250$ 472,311$ 30,350$ -$ 34,808$ -$ 2,062,744$
- - - - - - 532,511
- - - - - 117,427 118,107
- - - - -5,999 452,189
630,250 472,311 30,350 -34,808 123,426 3,165,551
- 60,607 30,350 - - - 90,957
- 103,576 - - - - 226,049
667,808 - - - - - 667,808
- - - - - - -
- 95,357 - - - - 1,059,644
- - - - - - 676,684
- 227,080 - - - - 821,337
- - - - 80,000 - 80,000
- - - -96,198 -96,198
667,808 486,620 30,350 -176,198 - 3,718,677
(37,558) (14,309) - - (141,390) 123,426 (553,126)
251,232 122,000 - - 141,390 - 824,622
- - -(11) - (147,093) (147,104)
251,232 122,000 -(11) 141,390 (147,093) 677,518
213,674 107,691 - (11) - (23,667) 124,392
284,716 15,106 -11 - 2,912,111 3,781,065
498,390$ 122,797$ -$ -$ -$ 2,888,444$ 3,905,457$
Capital Project
71
Final Variance With
Budget Actual Final Budget
Revenues:
Intergovernmental revenues - State grant12,965$ 17,437$ 4,472$
Charge for services - Parking, camping, and
boat launch 532,867 532,511 (356)
Investment earnings -680 680
Total revenues545,832 550,628 4,796
Expenditures:
Public Safety:
Personal services31,901 31,754 147
Supplies 10,485 10,429 56
Other services and charges 314 290 24
42,700 42,473 227
Expenditures chargeable from
other funds 80,000 80,000 -
Total public safety 122,700 122,473 227
Public Works - Streets:
Personal services24,066 22,095 1,971
Supplies 9,346 6,752 2,594
Other services and charges 28,744 18,585 10,159
62,156 47,432 14,724
Expenditures chargeable from
other funds 7,200 7,200 -
Total public works - streets 69,356 54,632 14,724
YEAR ENDED JUNE 30, 2015
CITY OF KENAI, ALASKA
PERSONAL USE FISHERY SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
72
Final Variance With
Expenditures, continued:Budget Actual Final Budget
Parks, Recreation & Cultural
Personal services67,677$ 56,864$ 10,813$
Supplies9,882 9,733 149
Other services and charges 148,876 123,532 25,344
Capital outlays 26,685 26,685 -
253,120 216,814 36,306
Expenditures chargeable from
other funds 27,700 27,700 -
Total parks, recreation & cultural 280,820 244,514 36,306
Public Works - Dock
Personal services54,423 58,184 (3,761)
Supplies 6,089 5,260 829 Other services and charges 16,155 16,066 89
76,667 79,510 (2,843)
Expenditures chargeable from
other funds 10,900 10,900 -
Total public works - dock 87,567 90,410 (2,843)
Total expenditures560,443 512,029 48,414
Net changes in fund balance(14,611)$ 38,599 53,210$
Fund balance - July 129,063
Fund balance - June 3067,662$
CITY OF KENAI, ALASKA
PERSONAL USE FISHERY SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
73
CITY OF KENAI, ALASKA
COUNCIL ON AGING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015
Final Variance With
Budget Actual Final Budget
Revenues:
Intergovernmental revenues:
State grants284,692$ 295,773$ 11,081$
Federal grants10,000 13,949 3,949
Kenai Peninsula Borough grant 126,207 126,207 -
Total intergovernmental revenues420,899 435,929 15,030
Miscellaneous revenues:
Choice Waiver reimbursement 400,000 322,826 (77,174)
United Way grants 12,655 8,762 (3,893)
Rents and leases 13,000 5,660 (7,340)
Donations 89,800 87,751 (2,049)
Other -316 316
Total miscellaneous revenues515,455 425,315 (90,140)
Total revenues 936,354 861,244 (75,110)
Expenditures - social welfare services:
Social services:
Personal services155,435 153,465 1,970
Supplies 8,100 6,630 1,470
Other services and charges 17,616 16,180 1,436
181,151 176,275 4,876
Expenditures chargeable from
other funds 31,700 31,700 -
Total social services212,851 207,975 4,876
Congregate meals:
Personal services83,467 80,180 3,287
Supplies 54,166 52,573 1,593
Other services and charges 25,791 14,433 11,358
Capital outlays 19,854 18,679 1,175
183,278 165,865 17,413
Expenditures chargeable from
other funds 26,400 26,400 -
Total congregate meals209,678 192,265 17,413
Home delivered meals:
Personal services65,954 63,009 2,945
Supplies 59,905 60,402 (497)
Other services and charges 15,093 11,403 3,690
140,952 134,814 6,138
Expenditures chargeable from
other funds 28,500 28,500 -
Total home delivered meals169,452 163,314 6,138
74
CITY OF KENAI, ALASKA
COUNCIL ON AGING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL, continued
FinalVariance With
Expenditures - continued:Budget Actual Final Budget
Transportation:
Personal services38,645$ 37,950$ 695$
Supplies 8,515 7,679 836
Other services and charges 8,797 4,560 4,237
Capital outlays 55,000 -55,000
110,957 50,189 60,768
Expenditures chargeable from
other funds 14,100 14,100 -
Total transportation125,057 64,289 60,768
Choice Waiver:
Personal services211,051 206,078 4,973
Supplies 60,180 58,191 1,989
Other services and charges 39,564 35,275 4,289
Capital outlays 1,693 -1,693
312,488 299,544 12,944
Expenditures chargeable from
other funds 36,900 36,900 -
Total Choice Waiver349,388 336,444 12,944
Total expenditures1,066,426 964,287 102,139
Net changes in fund balance(130,072)$ (103,043) 27,029$
Fund balance - July 1260,109
Fund balance - June 30157,066$
75
CITY OF KENAI, ALASKA
2010 BOND DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015
Final Variance With
Budget Actual Final Budget
Revenues - intergovernmental 34,264$ 34,808$ 544$
Expenditures - debt service:
Principal 80,000 80,000 -
Interest 98,598 96,198 2,400
Total expenditures178,598 176,198 2,400
Excess of revenues over (under)
expenditures (144,334) (141,390) 2,944
Other financing sources -
Transfers in 144,334 141,390 (2,944)
Net changes in fund balance-$ - -$
Fund balance - July 1-
Fund balance - June 30-$
76
Final Variance With
Budget Actual Final Budget
Revenues -
172,863$ 117,427$ (55,436)$ Investment earnings
Land sales -5,999 5,999
Total revenues 172,863 123,426 (49,437)
Other financing uses -
Transfers out(147,093) (147,093) -
Net changes in fund balance25,770$ (23,667) (49,437)$
Fund balance - July 12,912,111
Fund balance - June 302,888,444$
YEAR ENDED JUNE 30, 2015
CITY OF KENAI, ALASKA
GENERAL GOVERNMENT LAND SALES PERMANENT FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
77
CITY OF KENAI, ALASKA
AIRPORT LAND SALES PERMANENT FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015
Final Variance With
Budget Actual Final Budget
Revenues:
1,391,472$ 615,189$ (776,283)$ Investment earnings
Land sales -8,084 8,084
Total revenues1,391,472 623,273 (768,199)
Excess of revenues
over expenditures1,391,472 623,273 (768,199)
Other financing uses -
Transfers out(1,147,095) (1,135,313) 11,782
Net changes in fund balance 244,377$ (512,040) (756,417)$
Fund balance - July 1 24,223,069
Fund balance - June 30 23,711,029$
78
Internal Service Funds
This section includes the Statement of Net Position – Internal Service Funds, Combining Statement of Revenues,
Expenses, and Changes in Net Position – Internal Service Funds, and Combining Statement of Cash Flows – Internal
Service Funds.
Internal service funds are used to account for the financing of goods or services provided by one department or agency
to other departments or agencies of the City, on a cost reimbursement basis.
Equipment Replacement Fund – This fund accounts for the purchase of equipment costing more than $50,000 that will
be used by the General Fund departments on a cost-reimbursement basis.
Capital Project Management Fund – This fund provided concept evaluation, cost estimation, direct project
administration, engineering criteria review, grant writing, and project reporting. This fund was closed during the current
fiscal year and future project management costs will be directly charged staff time and actual out of pocket costs. Many
of the City’s capital projects are grant funded and grant provisions precluded the charging of time and materials as was
being done by this fund.
Governmental
Activities -
Internal
Service Funds
Equipment
Replacement
ASSETS
Current assets -
Equity in central treasury (cash and investments)1,254,419$
Noncurrent assets -
Property and equipment in service, at cost -
Equipment 2,590,989
Less accumulated depreciation (1,042,010)
Net property and equipment in service1,548,979
Total assets 2,803,398$
NET POSITION
Investment in capital assets 1,548,979
Unrestricted 1,254,419
Total net position 2,803,398$
CITY OF KENAI, ALASKA
STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
JUNE 30, 2015
79
Total
Equipment Capital ProjectInternal Service
Replacement Management Funds
Operating revenues:
Charges for services-$ 48,239$ 48,239$
Other revenue310,571 -310,571
Total operating revenues 310,571 48,239 358,810
Operating expenses:
Personal services- 64,386 64,386
Supplies - 761 761
Utilities - 465 465
Insurance - 1,186 1,186
Depreciation 154,700 - 154,700
Miscellaneous - 376 376
Expenses chargeable from other funds -4,786 4,786
Total operating expenses 154,700 71,960 226,660
Operating income (loss)155,871 (23,721) 132,150
Nonoperating revenues:
Gain on sale of capital assets- 3,135 3,135
Investment earnings 6,508 -6,508
Total nonoperating revenues 6,508 3,135 9,643
Transfers in -97,004 97,004
Changes in net position162,379 76,418 238,797
Net position (deficit) - July 1 2,641,019 (76,418) 2,564,601
Net position - June 30 2,803,398$ -$ 2,803,398$
Governmental Activities - Internal
Service Funds
CITY OF KENAI, ALASKA
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET POSITION
INTERNAL SERVICE FUNDS
YEAR ENDED JUNE 30, 2015
80
Total
Equipment Capital ProjectInternal Service
Replacement Management Funds
Cash flows from operating activities:
Receipts from customers-$ 48,239$ 48,239$
Payments to suppliers - (7,647) (7,647)
Payments to employees - (71,485) (71,485)
Receipts for interfund services 310,571 -310,571
Net cash provided (used) by operating activities 310,571 (30,893) 279,678
Cash flows from noncapital financing activities:
Decrease in Due to General Fund - (81,111) (81,111)
Operating transfer from General Fund -97,004 97,004
Net cash provided by noncapital financing activities-15,893 15,893
Acquisition of capital assets(320,100) - (320,100)
Proceeds from sales of capital assets -15,000 15,000
(320,100) 15,000 (305,100)
Cash flows from investing activities -
Investment earnings6,508 -6,508
Net increase (decrease) in cash and cash equivalents(3,021) - (3,021)
Cash and cash equivalents, beginning 1,257,440 - 1,257,440
Cash and cash equivalents, ending 1,254,419$ -$ 1,254,419$
Operating income (loss)155,871$ (23,721)$ 132,150$
Depreciation154,700 - 154,700
Accounts payable - (73) (73)
Compensated absences - (4,912) (4,912)
Accrued payroll and payroll liabilities -(2,187) (2,187)
Net cash provided (used) by operating activities310,571$ (30,893)$ 279,678$
Adjustments to reconcile operating income (loss) to net cash
provided (used) by operating activities:
Reconciliation of operating income (loss) to net cash
provided (used) by operating activities:
Cash flows from capital and related financing activities:
Net cash provided (used) by capital and related financing
activities
Governmental Activities - Internal
Service Funds
CITY OF KENAI, ALASKA
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
YEAR ENDED JUNE 30, 2015
81
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82
Fiduciary Fund
Through a management agreement, the City manages the donations of the Kenai Community Foundation, a
501(c)(3) not-for-profit entity, whose purpose is to support museums, parks and recreation, music, fine arts, library,
and historic purposes within Kenai’s city limits. The City’s sole purpose is management of the Foundation’s
donations; all decisions regarding Foundation awards are made by the Foundation and not the City.
Balance Balance
July 1, 2014 Additions Deductions June 30, 2015
Assets
65,781$ 5,462$ 5,100$ 66,143$
Liabilities
Due to Kenai Community Foundation65,781$ 5,462$ 5,100$ 66,143$
CITY OF KENAI, ALASKA
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
Year Ended June 30, 2015
KENAI COMMUNITY FOUNDATION AGENCY FUND
Equity in central treasury (cash and
investments)
83
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84
City of Kenai, Alaska
Statistical Section
This part of the City of Kenai’s comprehensive annual financial report presents detailed information as a
context for understanding what the information in the financial statements, note disclosures, and required
supplementary information says about the City’s overall financial health.
Contents:
Financial Trends
These schedules contain trend information to help the reader understand how the City’s financial
performance and well-being have changed over time.
Table I Net Position by Component
Table II Change in Net Position
Table III Governmental Activities Tax Revenues by Source
Table IV Fund Balances of Governmental Funds
Table V Changes in Fund Balances of Governmental Funds
Table VI General Governmental Tax Revenues by Source
Revenue Capacity
These schedules contain information to help the reader assess the City’s most significant local
revenue source, the sales tax.
Table VII Taxable Sales by Category
Table VIII Sales Tax Rates – Direct and Overlapping Governments
Debt Capacity
These schedules present information to help the reader assess the affordability of the City’s current
level of outstanding debt and the City’s ability to issue additional debt in the future.
Table IX Ratio of Outstanding Debt by Type
Table X Computation of Direct and Overlapping Debt
Table XI Legal Debt Margin Information
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the City’s financial activities take place.
Table XII Demographic and Economic Statistics
Table XIII Principal Employers
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the
information in the City’s financial report relates to the services the government provides and the
activities it performs.
Table XIV Full-time Equivalent City Government Employees by Fund
Table XV Operating Indicators by Function
Table XVI Capital Asset Statistics by Function
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year.
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3
3
5
2,
7
1
5
,
6
4
7
3,
0
1
8
,
4
8
0
2,816,810 2,175,350
Ca
p
i
t
a
l
g
r
a
n
t
s
a
n
d
c
o
n
t
r
i
b
u
t
i
o
n
s
2,
4
4
2
,
6
0
1
8,
0
6
4
,
4
2
6
7,
5
4
5
,
1
1
9
4,
7
8
1
,
1
6
1
9,
8
9
2
,
1
4
8
8,
6
0
4
,
8
8
6
4,
9
8
6
,
6
0
6
3,
5
4
9
,
9
7
3
4,799,694 2,424,814
To
t
a
l
g
o
v
e
r
n
m
e
n
t
a
l
a
c
t
i
v
i
t
i
e
s
p
r
o
g
r
a
m
r
e
v
e
n
u
e
s
7
,
3
5
0
,
7
5
3
13
,
5
0
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,
0
8
5
14
,
1
2
6
,
6
9
4
11
,
6
1
4
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1
2
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,
5
1
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3
6
2
15
,
4
2
9
,
5
3
0
12
,
7
0
7
,
0
5
6
12
,
3
9
3
,
8
4
6
13,483,720 10,685,023
CI
T
Y
O
F
K
E
N
A
I
,
A
L
A
S
K
A
TABLE II
CH
A
N
G
E
I
N
N
E
T
P
O
S
I
T
I
O
N
LA
S
T
T
E
N
F
I
S
C
A
L
Y
E
A
R
S
(A
C
C
R
U
A
L
B
A
S
I
S
O
F
A
C
C
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N
T
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N
G
)
86
Bu
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
:
Ch
a
r
g
e
s
f
o
r
s
e
r
v
i
c
e
s
:
Ai
r
p
o
r
t
t
e
r
m
i
n
a
l
3
6
7
,
9
1
1
-
-
-
-
-
-
-
-
-
Se
n
i
o
r
h
o
u
s
i
n
g
2
7
5
,
1
8
5
2
7
9
,
1
0
2
2
9
9
,
5
6
3
3
2
1
,
0
4
5
3
2
3
,
1
0
5
2
8
9
,
3
3
6
3
2
2
,
3
5
5
3
2
6
,
9
4
0
3
4
6
,
4
3
5
365,450
Op
e
r
a
t
i
n
g
g
r
a
n
t
s
a
n
d
c
o
n
t
r
i
b
u
t
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o
n
s
8
0
0
7
1
4
2
,
3
4
2
3
,
0
0
4
1
,
3
3
5
2
,
0
8
7
2
3
,
1
8
9
7
,
9
0
0
4
,
9
4
0
16,482
Ca
p
i
t
a
l
g
r
a
n
t
s
a
n
d
c
o
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t
r
i
b
u
t
i
o
n
s
2
,
7
3
7
-
-
-
-
-
-
-
-
-
To
t
a
l
b
u
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
p
r
o
g
r
a
m
r
e
v
e
n
u
e
s
6
4
6
,
6
3
3
2
7
9
,
8
1
6
3
0
1
,
9
0
5
3
2
4
,
0
4
9
3
2
4
,
4
4
0
2
9
1
,
4
2
3
3
4
5
,
5
4
4
3
3
4
,
8
4
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3
5
1
,
3
7
5
381,932
To
t
a
l
p
r
i
m
a
r
y
g
o
v
e
r
n
m
e
n
t
p
r
o
g
r
a
m
r
e
v
e
n
u
e
s
7
,
9
9
7
,
3
8
6
$
1
3
,
7
8
0
,
9
0
1
$
1
4
,
4
2
8
,
5
9
9
$
1
1
,
9
3
8
,
1
7
8
$
1
6
,
8
3
5
,
8
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2
$
1
5
,
7
2
0
,
9
5
3
$
1
3
,
0
5
2
,
6
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0
$
1
2
,
7
2
8
,
6
8
6
$
1
3
,
8
3
5
,
0
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5
$ 11,066,955$
Ne
t
(
e
x
p
e
n
s
e
s
)
/
r
e
v
e
n
u
e
:
Go
v
e
r
n
m
e
n
t
a
l
a
c
t
i
v
i
t
i
e
s
(
7
,
4
0
8
,
6
6
3
)
$
(
2
,
9
8
4
,
3
9
3
)
$
(
2
,
6
8
8
,
5
3
7
)
$
(
6
,
4
5
7
,
7
5
5
)
$
(
1
,
7
9
1
,
4
2
9
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$
(
4
,
1
2
6
,
6
1
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(
8
,
2
8
3
,
3
5
6
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$
(
1
1
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3
4
7
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6
6
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$
(
9
,
8
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9
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$ (12,538,770)$
Bu
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
(
2
1
3
,
8
8
7
)
(
8
4
,
8
7
2
)
(
6
7
,
6
6
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(
9
0
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8
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(
5
9
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(
1
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9
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8
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8
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To
t
a
l
p
r
i
m
a
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y
g
o
v
e
r
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e
x
p
e
n
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e
(
7
,
6
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2
,
5
5
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(
3
,
0
6
9
,
2
6
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(
2
,
7
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6
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9
7
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(
6
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5
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(
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(
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(
8
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3
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7
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5
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(
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4
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$
(
9
,
8
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$ (12,611,267)$
Ge
n
e
r
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l
R
e
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a
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t
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e
s
:
Ta
x
e
s
:
Pr
o
p
e
r
t
y
t
a
x
e
s
2,
0
2
4
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5
0
2
$
2,
1
5
6
,
3
7
3
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2,
3
4
7
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0
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3
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2,
6
9
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6
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4
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8
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2,
6
1
3
,
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6
5
7
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8
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$
3,155,662$ 3,656,927$
Sa
l
e
s
t
a
x
e
s
4,
4
0
4
,
1
5
8
4,
6
3
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8
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1
9
6
,
0
4
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3
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5
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5
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5
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6,669,426 7,257,451
Sa
l
e
s
o
f
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a
p
i
t
a
l
a
s
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e
t
s
45
2
,
7
6
6
10
5
,
3
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0
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4
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6
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In
v
e
s
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r
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n
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s
88
0
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3
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8
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9
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1
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6
6
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4
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8
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8
9
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0
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4
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3,494,763 789,523
Ot
h
e
r
-
-
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6,
0
5
4
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Tr
a
n
s
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0
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8
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5
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8
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4
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-
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-
(
1
1
2
,
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4
4
)
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Fu
n
d
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o
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o
n
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Wr
i
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-
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To
t
a
l
g
o
v
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r
n
m
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n
t
a
l
a
c
t
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e
s
7
,
7
6
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7
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3
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2
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3
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3
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4
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9
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8
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5
6
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1
2
,
1
4
6
,
6
5
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1
0
,
8
6
0
,
3
9
2
1
2
,
7
6
4
,
0
5
8
9
,
4
8
5
,
2
4
7
1
1
,
9
0
8
,
5
8
3
1
3
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2
0
7
,
8
0
7
11,703,901
Bu
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
:
In
v
e
s
t
m
e
n
t
e
a
r
n
i
n
g
s
(
l
o
s
s
)
6
8
,
4
1
1
2
9
,
3
1
2
3
0
,
3
7
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2
4
,
6
7
2
4
,
8
9
6
3
,
6
4
2
2
,
4
3
6
(
1
,
8
2
6
)
5
,
0
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2
2,533
In
s
u
r
a
n
c
e
s
e
t
t
l
e
m
e
n
t
-
-
-
-
-
1
7
5
,
0
0
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4
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2
-
-
-
Tr
a
n
s
f
e
r
s
-
(2
,
0
6
2
,
8
7
0
)
(3
1
,
5
0
0
)
(8
8
,
0
4
4
)
-
-
-
-
112,044 -
Fu
n
d
c
o
n
v
e
r
s
i
o
n
-
(1
,
5
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2
,
5
1
3
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-
-
-
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Wr
i
t
e
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o
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-
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6
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4
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To
t
a
l
b
u
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
68
,
4
1
1
(3
,
5
3
6
,
0
7
1
)
(1
,
1
2
9
)
(5
9
,
7
3
8
)
4,
8
9
6
17
8
,
6
4
2
26
,
4
4
8
(1,826)
117,106 2,533
To
t
a
l
p
r
i
m
a
r
y
g
o
v
e
r
n
m
e
n
t
7,
8
3
0
,
1
4
4
$
8,
7
8
4
,
2
8
9
$
14
,
9
5
7
,
4
3
1
$
12
,
0
8
6
,
9
2
0
$
10
,
8
6
5
,
2
8
8
$
12
,
9
4
2
,
7
0
0
$
9,
5
1
1
,
6
9
5
$
11
,
9
0
6
,
7
5
7
$
13,324,913$ 11,706,434$
Ch
a
n
g
e
s
i
n
N
e
t
P
o
s
i
t
i
o
n
Go
v
e
r
n
m
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t
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l
a
c
t
i
v
i
t
i
e
s
35
3
,
0
7
0
$
9,
3
3
5
,
9
6
7
$
12
,
2
7
0
,
0
2
3
$
5,
6
8
8
,
9
0
3
$
9,
0
6
8
,
9
6
3
$
8,
6
3
7
,
4
4
6
$
1,
2
0
1
,
8
9
1
$
560,923
$
3,399,816$ (834,869)$
Bu
s
i
n
e
s
s
-
t
y
p
e
a
c
t
i
v
i
t
i
e
s
(1
4
5
,
4
7
6
)
(3
,
6
2
0
,
9
4
3
)
(6
8
,
7
8
9
)
(1
5
0
,
5
5
8
)
(5
4
,
2
4
9
)
63
,
1
1
5
(6
5
,
9
5
1
)
(84,354)
31,846 (69,964)
To
t
a
l
p
r
i
m
a
r
y
g
o
v
e
r
n
m
e
n
t
20
7
,
5
9
4
$
5,
7
1
5
,
0
2
4
$
12
,
2
0
1
,
2
3
4
$
5,
5
3
8
,
3
4
5
$
9,
0
1
4
,
7
1
4
$
8,
7
0
0
,
5
6
1
$
1,
1
3
5
,
9
4
0
$
476,569
$
3,431,662$ (904,833)$
87
Fiscal Year Property Tax Sales Tax Total
2006 $2,024,502 $4,404,158 $ 6,428,660
2007 2,156,373 4,631,812 6,788,185
2008 2,347,063 5,196,046 7,543,109
2009 2,694,872 5,372,499 8,067,371
2010 2,614,768 5,561,970 8,176,738
2011 2,613,756 6,260,403 8,874,159
2012 2,657,670 6,576,657 9,234,327
2013 2,898,103 6,587,575 9,485,678
2014 3,155,662 6,669,426 9,825,088
2015 3,656,927 7,257,451 10,914,378
(ACCRUAL BASIS OF ACCOUNTING)
CITY OF KENAI, ALASKA
Table III
GOVERNMENTAL ACTIVITIES TAX REVENUES BY SOURCE
LAST TEN FISCAL YEARS
88
20
0
6
20
0
7
20
0
8
20
0
9
20
1
0
20
1
1
20
1
2
20
1
3
20142015
Ge
n
e
r
a
l
Fun
d
:
Re
s
e
r
v
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27,630,052 26,600,093
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$
(2
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1,605,746
$
585,211$ 310,456$
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$ 23,611,368$
CI
T
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F
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,
A
L
A
S
K
A
Table V
CH
A
N
G
E
S
I
N
F
U
N
D
B
A
L
A
N
C
E
S
O
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T
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F
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D
S
LA
S
T
T
E
N
F
I
S
C
A
L
Y
E
A
R
S
(M
O
D
I
F
I
E
D
A
C
C
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A
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B
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S
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C
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)
90
Fiscal Year
EndedTotalPropertySales
June 30 Taxes Taxes Tax
2006 $6,423,361 $2,019,203 $4,404,158
2007 6,792,499 2,160,687 4,631,812
2008 7,527,758 2,331,712 5,196,046
2009 8,101,263 2,728,764 5,372,499
2010 8,163,558 2,601,588 5,561,970
2011 8,889,727 2,629,324 6,260,403
2012 9,215,440 2,638,783 6,576,657
2013 9,501,209 2,913,634 6,587,575
2014 9,831,956 3,162,530 6,669,426
2015 10,914,378 3,656,927 7,257,451
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
CITY OF KENAI, ALASKA
TABLE VI
GENERAL GOVERNMENTAL TAX REVENUES BY SOURCE
LAST TEN FISCAL YEARS
91
Administrative, Waste Management,1,176,435$
Agriculture, Forestry, Fishing & Hunting 213,765
Arts and Entertainment 518,745
Construction Contracting 1,366,341
Educational Services 226,100
Finance and Insurance 555,980
Guiding Land 4,400
Guiding Water 321,732
Health Care and Social Assistance 73,510
Hotel/Motel/Bed & Breakfast 10,443,325
Information 9,475,629
Manufacturing 1,332,518
Mining/Quarrying 118,952
Professional, Scientific and Technical Services 3,396,344
Public Administration 3,304,716
Remediation Services 12,000
Rental Commercial Property 430,127
Rental Non-Residental Propery 2,510,639
Rental of Self-storage & Miniwarehouses 16,280
Rental Personal Property 264,719
Rental Residental Property 5,102,726
Restaurant/Bar 14,055,651
Retail Trade 162,134,036
Services 4,929,136
Telecommunications 2,526,507
Transportation and Warehousing 373,378
Utilities 10,261,338
Wholesale Trade 3,471,361
Total 238,616,390$
City direct sales tax rate 3.00%
Source: The Kenai Peninsula Borough Sales Tax Department.
CITY OF KENAI, ALASKA
Table VII
TAXABLE SALES BY CATEGORY
CURRENT FISCAL YEAR
92
Overlapping Rates
Kenai
Fiscal Year City of KenaiPeninsula BoroughTotal
20063.002.005.00
20073.002.005.00
20083.003.006.00
20093.003.006.00
20103.003.006.00
20113.003.006.00
20123.003.006.00
20133.003.006.00
20143.003.006.00
20153.003.006.00
Source: The Kenai Peninsula Borough Sales Tax Department.
LAST TEN FISCAL YEARS
TABLE VIII
CITY OF KENAI, ALASKA
SALES TAX RATES
DIRECT AND OVERLAPPING GOVERNMENTS
93
TABLE IX
Governmental
Activities
Fiscal Year
General Obligation
Bonds
Estimated
Percentage of
Personal Income
*
Percentage of
Estimated Actual
Taxable Value of
Property
Debt Per
Capita **
2006 -$ 0.00%0.00%-$
2007 - 0.00%0.00%-
2008 - 0.00%0.00%-
2009 - 0.00%0.00%-
2010 2,000,000 0.64%0.32%281.69
2011 1,925,000 0.69%0.29%271.13
2012 1,850,000 0.64%0.28%256.30
2013 1,775,000 0.49%0.21%238.19
2014 1,695,000 0.47%0.21%227.46
2015 1,615,000 0.47%0.19%213.40
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
*Personal income is estimated by using Kenai Peninsula Borough income to calculate per capita
income and total income for City of Kenai.
** Population data can be found on Table XII.
TABLE X
Percentage Cityof
Applicable to this Kenai's
Net Debt Governmental Share
Name of Governmental Unit Outstanding Unit (1)of Debt
Direct debt -
City of Kenai, Alaska1,615,000$ 100.00%1,615,000$
Overlapping debt:
Kenai Peninsula Borough41,820,000 11.95%4,997,490
Central Peninsula Hospital59,560,000 16.63%9,904,828
Total overlapping debt101,380,000 14,902,318
Total Direct and Overlapping 102,995,000$ 16,517,318$
Source: The Kenai Peninsula Borough.
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City.
This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by
the residents and businesses of the City of Kenai.
(1) The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable
percentages were estimated by dividing the City's taxable assessed property values by those of the Borough.
JUNE 30, 2015
CITY OF KENAI, ALASKA
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
CITY OF KENAI, ALASKA
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
94
20
0
6
20
0
7
20
0
8
20
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9
20
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20
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20142015
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85
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1
2
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91
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98
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$ 159,196$ 164,062$
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TABLE XI
LE
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95
TABLE XII
Fi
s
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8
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1
2
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40
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6
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20
1
3
7,
4
5
2
1,
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7
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57
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1
4
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7
7
0
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7
9
6
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4
8
5
41
.
4
9,
0
6
5
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20
1
4
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5
6
8
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8
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0
8
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5
8,
9
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20
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5
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6
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5
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9
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T
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F
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N
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t
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(
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S
T
T
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F
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E
A
R
S
96
CITY OF KENAI, ALASKA
TABLE XIII
KENAI AREA PRINCIPAL EMPLOYERS
With a 2009 change in Alaska Statute, specific employer information is no longer available.
97
20
0
6
20
0
7
20
0
8
20
0
9
20
1
0
20
1
1
20
1
2
20
1
3
20
1
4
2015
Ge
n
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r
a
l
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n
d
Ci
t
y
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k
1
.
0
0
1
.
5
0
1
.
5
0
1
.
5
0
1
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5
0
1
.
5
0
1
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5
0
1
.
5
0
1
.
5
0
1
.
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0
Ci
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r
1
.
5
0
1
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5
0
1
.
5
0
1
.
5
0
1
.
5
0
1
.
5
0
1
.
5
0
1
.
6
7
1
.
6
7
1
.
6
7
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g
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l
2
.
0
0
2
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0
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2
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0
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2
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0
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2
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2
5
2
.
0
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2
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0
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2
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0
0
2
.
0
0
2
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0
0
Fi
n
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e
4
.
6
3
3
.
7
5
3
.
7
5
3
.
7
5
3
.
7
5
3
.
7
5
4
.
7
5
4
.
7
5
4
.
7
5
4
.
7
5
Po
l
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e
1
8
.
4
5
1
8
.
4
5
1
8
.
6
2
1
9
.
8
3
2
0
.
8
3
2
0
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8
8
2
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8
8
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8
8
2
0
.
6
5
1
9
.
6
0
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e
1
6
.
0
0
1
6
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0
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1
6
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1
6
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0
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1
6
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0
0
1
9
.
0
0
1
9
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1
9
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0
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1
9
.
0
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9
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0
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s
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8
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8
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0
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8
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0
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8
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8
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0
0
8
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0
0
8
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0
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0
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2
.
1
2
2
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6
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6
0
2
.
6
0
2
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6
0
2
.
8
0
2
.
8
0
2
.
9
0
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9
0
2
.
9
0
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3
.
0
0
3
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0
0
2
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0
0
2
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0
0
2
.
0
0
2
.
0
0
1
.
5
0
1
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5
0
1
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5
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5
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Pl
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2
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0
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2
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0
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0
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0
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8
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1
2
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0
6
1
1
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6
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1
1
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6
4
1
1
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6
4
1
1
.
6
4
1
1
.
6
4
1
1
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6
4
1
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6
4
1
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.
7
0
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.
7
9
Li
b
r
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6
.
6
4
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1
4
6
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3
4
6
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5
5
6
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6
8
6
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6
8
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8
8
8
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5
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7
7
6.
5
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5
1
6.
9
9
6.
9
9
6.
9
9
7.
6
1
9.
6
0
8.
0
4
8.06
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r
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F
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d
T
o
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l
83
.
1
7
8
3
.
0
9
8
2
.
4
6
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4
.
3
6
8
5
.
7
4
8
8
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7
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9
1
.
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6
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9
7
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6
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6
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7
6
6
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7
6
6
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7
6
6
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7
6
6
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7
6
6
.
7
6
6
.
7
6
7
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7
6
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7
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1
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5
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1
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5
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1
8
5
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5
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4
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6
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Se
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6
8.
0
6
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6
8.
1
9
8.
1
9
6.
6
9
6.
8
5
6.
9
7
7.
4
3
7.35
S
p
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1
9
.
5
6
20
.
0
0
20
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0
0
20
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1
3
20
.
1
3
18
.
6
3
18
.
7
9
19
.
1
6
23
.
4
9
24.52
En
t
e
r
p
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e
F
u
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d
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n
g
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0.
3
5
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3
5
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3
5
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3
5
0.
3
5
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3
5
0.
3
5
0.
3
5
0.
4
5
0.45
In
t
e
r
n
a
l
S
e
r
v
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F
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d
Ca
p
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0.
0
0
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0
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5
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5
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5
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0.50
T
o
t
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s
1
0
3
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8
10
3
.
4
4
10
2
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1
10
4
.
8
4
10
6
.
2
2
10
7
.
7
2
11
0
.
7
0
11
3
.
9
8
11
5
.
2
5
115.34
So
u
r
c
e
:
T
h
e
C
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t
y
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f
K
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n
a
i
F
i
n
a
n
c
e
D
e
p
a
r
t
m
e
n
t
.
CI
T
Y
O
F
K
E
N
A
I
,
A
L
A
S
K
A
TABLE XIV
FU
L
L
-
T
I
M
E
E
Q
U
I
V
A
L
E
N
T
E
M
P
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E
S
B
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F
U
N
D
LA
S
T
T
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N
F
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C
A
L
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A
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S
98
20
0
5
20
0
6
20
0
7
20
0
8
20
0
9
20
1
0
20
1
1
20
1
2
20132014
Fu
n
c
t
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o
n
Pu
b
l
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c
S
a
f
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t
y
Po
l
i
c
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S
e
r
v
i
c
e
s
:
Po
l
i
c
e
r
e
q
u
e
s
t
s
f
o
r
s
e
r
v
i
c
e
7,
3
6
4
7
,
7
8
9
7
,
5
9
3
7
,
1
2
0
7
,
6
2
6
7
,
3
8
5
7
,
6
6
5
8
,
2
9
7
8
,
3
1
4
8
,
1
9
7
Cr
i
m
i
n
a
l
a
r
r
e
s
t
s
1,
0
6
3
9
9
1
7
1
6
9
7
0
1
,
1
0
3
92
6
8
9
4
1
,
1
3
8
1
,
0
4
1
924
Fi
r
e
a
n
d
E
m
e
r
g
e
n
c
y
S
e
r
v
i
c
e
s
:
Nu
m
b
e
r
o
f
c
a
l
l
s
r
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s
p
o
n
d
e
d
t
o
1,
2
1
2
1
,
2
9
7
1
,
3
8
2
1
,
4
6
9
1
,
5
9
9
1
,
2
3
0
1
,
3
2
8
1
,
2
1
2
1
,
1
5
3
1
,
2
2
6
In
s
p
e
c
t
i
o
n
s
15
6
1
0
4
2
0
0
2
5
6
2
8
9
2
3
2
3
1
9
2
3
9
2
6
8
1
5
7
An
i
m
a
l
C
o
n
t
r
o
l
:
To
t
a
l
C
a
l
l
s
7,
5
1
5
8
,
2
5
8
9
,
1
8
0
1
0
,
6
9
7
7,
8
1
1
6
,
6
1
9
6
,
6
9
5
6
,
5
4
9
7
,
1
9
7
N/A
To
t
a
l
r
e
q
u
e
s
t
s
f
o
r
s
e
r
v
i
c
e
N/
A
N
/
A
N
/
A
N
/
A
N
/
A
N
/
A
N
/
A
N
/
A
N
/
A
5
6
4
An
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m
a
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s
H
a
n
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d
1,
7
6
7
1
,
8
2
8
1
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8
3
7
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,
5
7
1
1
,
4
1
7
1
,
4
7
6
1
,
6
7
3
1
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6
3
1
1
,
4
2
9
1
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1
8
8
Wa
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r
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1,
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8
4
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0
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1
,
0
6
9
,
2
9
9
9
6
4
,
3
7
3
9
3
9
,
1
0
7
1
,
0
1
6
,
6
0
8
9
1
8
,
3
4
5
9
6
1
,
5
6
4
9
4
3
,
7
6
4
8
7
5
,
4
2
7
8
1
2
,
7
5
6
Wa
s
t
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w
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r
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g
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s
p
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r
d
a
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59
1
,
0
0
0
5
7
9
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0
0
0
5
7
3
,
0
0
0
5
7
5
,
5
0
0
5
6
9
,
9
1
6
5
2
8
,
6
6
7
4
7
0
,
4
1
7
5
4
0
,
5
8
3
5
6
6
,
4
1
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5
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5
0
Ai
r
p
o
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t
P
a
s
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n
p
l
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n
t
s
83
,
5
2
3
9
4
,
1
6
3
9
4
,
7
2
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9
9
,
8
8
4
8
4
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3
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7
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4
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9
9
5
1
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2
9
***So
u
r
c
e
:
V
a
r
i
o
u
s
C
i
t
y
D
e
p
a
r
t
m
e
n
t
s
.
Du
r
i
n
g
20
1
4
th
e
sh
e
l
t
e
r
lo
s
t
th
e
ab
i
l
i
t
y
to
tr
a
c
k
to
t
a
l
ca
l
l
s
bu
t
be
g
a
n
tr
a
c
k
i
n
g
ca
l
l
s
fo
r
se
r
v
i
c
e
.
Ca
l
l
s
fo
r
se
r
v
i
c
e
wi
l
l
be
re
p
o
r
t
e
d
in
fu
t
u
r
e
years.
Du
r
i
n
g
ca
l
e
n
d
a
r
ye
a
r
20
1
0
th
e
fi
r
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de
p
a
r
t
m
e
n
t
tr
a
n
s
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t
i
o
n
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d
to
a ne
w
re
p
o
r
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n
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s
t
e
m
th
a
t
no
lo
n
g
e
r
co
u
n
t
s
re
s
p
o
n
s
e
s
to
th
e
sa
m
e
in
c
i
d
e
n
t
from both fire
st
a
t
i
o
n
s
as
mu
l
t
i
p
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ca
l
l
s
.
El
i
m
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a
t
i
o
n
of
th
i
s
du
p
l
i
c
a
t
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gi
v
e
s
th
e
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p
r
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s
s
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vo
l
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m
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ha
v
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d
u
c
e
d
wh
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n
in
fa
c
t
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l
l
vo
l
u
m
e
s
co
n
t
i
n
u
e
to increase at 8‐
10
%
an
n
u
a
l
l
y
.
CI
T
Y
O
F
K
E
N
A
I
,
A
L
A
S
K
A
OP
E
R
A
T
I
N
G
I
N
D
I
C
A
T
O
R
S
B
Y
F
U
N
C
T
I
O
N
LA
S
T
T
E
N
C
A
L
E
N
D
A
R
Y
E
A
R
S
TABLE XV
99
20
0
6
20
0
7
20
0
8
20
0
9
20
1
0
20
1
1
20
1
2
201320142015
Mi
l
e
s
o
f
S
t
r
e
e
t
s
62
6
2
6
2
6
2
6
2
6
2
6
2
6
2
6
2
6
2
Mi
l
e
s
o
f
S
e
w
e
r
:
St
o
r
m
1
0
1
0
1
0
1
0
1
0
1
0
1
0
1
0
1
0
1
0
Sa
n
i
t
a
r
y
6
8
6
8
6
8
6
8
6
8
6
8
6
8
6
8
6
8
6
8
Fi
r
e
P
r
o
t
e
c
t
i
o
n
:
Nu
m
b
e
r
o
f
S
t
a
t
i
o
n
s
22
2
2
2
2
2
2
2
2
Po
l
i
c
e
P
r
o
t
e
c
t
i
o
n
:
Nu
m
b
e
r
o
f
S
t
a
t
i
o
n
s
11
1
1
1
1
1
1
1
1
Re
c
r
e
a
t
i
o
n
:
Nu
m
b
e
r
o
f
F
a
c
i
l
i
t
i
e
s
:
Pa
r
k
s
99
9
9
9
9
9
9
9
9
Ba
s
e
b
a
l
l
a
n
d
S
o
f
t
b
a
l
l
F
i
e
l
d
s
11
1
1
1
1
88
8
8
8
8
8
So
c
c
e
r
F
i
e
l
d
s
00
2
6
6
6
6
6
6
6
Re
c
r
e
a
t
i
o
n
C
e
n
t
e
r
11
1
1
1
1
1
1
1
1
Pe
d
e
s
t
r
i
a
n
T
r
a
i
l
s
22
2
2
2
2
6
6
6
6
Cr
o
s
s
C
o
u
n
t
r
y
S
k
i
T
r
a
i
l
s
11
1
1
1
1
1
1
1
1
Ic
e
R
i
n
k
11
1
1
1
1
1
1
1
1
So
u
r
c
e
:
V
a
r
i
o
u
s
C
i
t
y
D
e
p
a
r
t
m
e
n
t
s
.
CI
T
Y
O
F
K
E
N
A
I
,
A
L
A
S
K
A
TABLE XVI
CA
P
I
T
A
L
A
S
S
E
T
S
T
A
T
I
S
T
I
C
S
B
Y
F
U
N
C
T
I
O
N
LA
S
T
T
E
N
F
I
S
C
A
L
Y
E
A
R
S
100