Item 3C: Adoption of Resolution Acknowleding CAFR

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Aa3 for full faith and credit obligations, which includes the Library Obligations, the Atrium Obligations, the Santa Clara Fire Station Obligations, and the Broadway Garages Limited Tax Bonds (October 2003). A3 underlying and Caa2 insured for the pension obligations. The pension obligations are insured by Ambac Assurance and were rated Aaa at issuance. Subsequent to issuance, Ambac Assurance was downgraded by Moody’s Investors Service. Ambac Assurance is currently rated as Caa2. The pension obligations were issued as one offering for certain Oregon cities, counties, and special districts. The City of Eugene’s share of the total pension obligations on which the rating was based is 29.7%. Under Oregon Revised Statutes, general obligation debt issues are limited to 3% of the real market value of all taxable property within the City’s boundaries. The $40.2 million in general obligation debt applicable to this limit, plus a $0.5 million deficit in the General Obligation Debt Service Fund, is well below the $703.4 million ceiling. The City’s net direct general obligation bonded debt per capita is $263. Additional information on the City’s bonded debt can be found in the Notes to Basic Financial Statements (Note 4I). Fund-based Financial Analysis As previously discussed, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. . Governmental funds The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $84.2 million, a decrease of $2.5 million in comparison to the prior year. Approximately 95.6% of this total amount ($80.5 million) constitutes unreserved fund balance, which is available for spending at the government’s discretion, subject to reporting fund-type limitations. The remainder of fund balance is reserved, indicating that it is not available for new spending because it has been reserved for other purposes ($3.7 million). Reservations of fund balance are for the following purposes: 1) prepaid expenditures, 2) debt service, 3) inventories, and 4) assets held for resale. The fund balance of the City’s General Fund increased $2.1 million from $30.4 million to $32.5 million during the current fiscal year. The increase was caused by a $0.8 million increase in revenues over the prior year, most notably a $5.3 million increase in tax revenues that was offset by a $2.8 million decrease in intergovernmental revenues and a $1.0 million decrease in miscellaneous revenues. Expenditures were down $1.2 million compared to the prior year, mostly due to a $1.9 million decrease in central services expenditures and a $1.0 million decrease in police expenditures. These reductions were partially offset by a $1.2 million increase in library, recreation, and cultural services expenditures. The fund balance in the Community Development Fund decreased $0.2 million from $2.0 million to $1.8 million during the current fiscal year. The decrease was primarily due to a $0.6 million decrease in grant revenues which was offset by a $1.1 million decrease in expenditures. The fund balance in the General Capital Projects Fund decreased $1.2 million from $6.5 million to $5.3 million during the current fiscal year. The decrease in the fund balance was caused by current year expenditures of $8.5 million, which were in excess of current year revenues requiring the utilization of $1.2 million in resources accumulated in prior years. The fund balance in the Systems Development Capital Projects Fund decreased $4.8 million from $10.4 million to $5.6 million during the current fiscal year. The decrease was largely due to current year expenditures of $7.6 million, which were in excess of current year revenues requiring the utilization of $4.8 million in resources accumulated in prior years.