fort myers 2015 cafr

City of Fort Myers, Florida Comprehensive Annual Financial Report Fiscal Year Ended September 30, 2015

City of Fort Myers, Florida

Comprehensive Annual Financial Report

For the Fiscal Year Ended September 30, 2015

Prepared by the Financial Services Department Accounting Division

Director of Finance

Maria Joyner

City of Fort Myers, Florida Elected Officials as of March 18, 2016

Randall Henderson Jr., Mayor

Teresa Watkins Brown, Mayor Pro Tem, Ward 1

Johnny W. Streets Jr. Ward 2

Terolyn Watson, Ward 3

Michael A. Flanders, Ward 4

Forrest Banks, Ward 5

Gaile Anthony, Ward 6

CITY OF FORT MYERS Comprehensive Annual Financial Report

For the Fiscal Year Ended September 30, 2015

TABLE OF CONTENTS

I. Introductory Section

Letter of Transmittal .................................................................................................................................... i Certificate of Achievement for Excellence in Financial Reporting ............................................................... vii Organizational Chart ................................................................................................................................... viii

II. Financial Section

Independent Auditors’ Report ..................................................................................................................... 1 Management’s Discussion and Analysis ..................................................................................................... 4

III. Basic Financial Statements

Government-wide Financial Statements Statement of Net Position .................................................................................................................... 17 Statement of Activities ......................................................................................................................... 19

Fund Financial Statements

Governmental Fund Financial Statements: Balance Sheet .............................................................................................................................. 20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net

Position ..................................................................................................................................... 23 Statement of Revenues, Expenditures, and Changes in Fund Balances ..................................... 24 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund

Balances of Governmental Funds to the Statement of Activities ............................................... 26

Proprietary Fund Financial Statements: Statement of Net Position ............................................................................................................. 27 Statement of Revenues, Expenses, and Changes in Net Position ............................................... 28 Statement of Cash Flows ............................................................................................................. 29

Fiduciary Fund Financial Statements:

Statement of Net Position –Trust and Agency Funds ................................................................... 30 Statement of Changes in Net Position – Pension Trust Funds ..................................................... 31

Notes to the Financial Statements .......................................................................................................... 33

Required Supplementary Information

Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual General Fund ................................................................................................................................ 98

Notes to Required Supplementary Information .................................................................................... 99 Employees’ Pension and Other Postemployment Benefits Schedules:

General Employees’ Pension Plan: Schedule of Changes in Net Pension Liability and Related Ratios ........................................ 100 Schedule of Contributions ..................................................................................................... 101

Police Officers’ Retirement System: Schedule of Changes in Net Pension Liability and Related Ratios ........................................ 102 Schedule of Contributions ..................................................................................................... 104

Firefighters’ Retirement System: Schedule of Changes in Net Pension Liability and Related Ratios ........................................ 105 Schedule of Contributions ..................................................................................................... 107

Schedule of Investment Returns ................................................................................................... 108 Schedule of Funding Progress – Other Postemployment Benefits Plan ....................................... 109

IV. Combining and Individual Fund Statements and Schedules

Major Governmental Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual

Revenue Bonds and Notes ........................................................................................................... 113

Nonmajor Governmental Funds Combining Balance Sheet Nonmajor Governmental Funds ................................................................ 116 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ........................... 120 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual

Law Enforcement Trust Fund ....................................................................................................... 124 Federal Forfeiture Fund ................................................................................................................ 125 FEMA Disaster Grant ................................................................................................................... 126 Grants ........................................................................................................................................... 127 Special Assessment Geographical Area Administration ............................................................... 128 Police Training Fund ..................................................................................................................... 129 Street Light Maintenance Fund ..................................................................................................... 130 Street Maintenance Fund ............................................................................................................. 131 Public Art Fund ............................................................................................................................. 132 Law Enforcement Equipment Fund .............................................................................................. 133 Attainable Workforce Housing Fund ............................................................................................. 134 Hurricane Shelter Fund ................................................................................................................ 135 Public-Private Parking Fund ......................................................................................................... 136 East Riverside Community Center Fund ...................................................................................... 137 Para-Transit Fund ......................................................................................................................... 138 Patrons of the Palms Fund ........................................................................................................... 139 State Housing Initiative Partnership Program (SHIP) ................................................................... 140 Community Redevelopment Agency ............................................................................................ 141 Community Development Block Grant .......................................................................................... 142 Crime Prevention Fund ................................................................................................................. 143

Nonmajor Enterprise Funds

Combining Statement of Net Position .................................................................................................. 146 Combining Statement of Revenues, Expenses and Changes in Net Position ..................................... 148 Combining Statement of Cash Flows ................................................................................................... 150

Internal Service Funds

Combining Statement of Net Position .................................................................................................. 154 Combining Statement of Revenues, Expenses and Changes in Net Position ..................................... 155 Combining Statement of Cash Flows ................................................................................................... 156

Fiduciary Funds

Combining Statement of Changes in Assets and Liabilities – Agency Funds ...................................... 158

V. Statistical Section

Financial Trends Schedule 1 – Net Position by Component ........................................................................................... 160 Schedule 2 – Changes in Net Position ................................................................................................ 162 Schedule 3 – Fund Balances of Governmental Funds ......................................................................... 164 Schedule 4 – Changes in Fund Balances of Governmental Funds ..................................................... 166

Revenue Capacity Schedule 5 – Assessed Value and Estimated Actual Value of Taxable Property ................................ 168 Schedule 6 – Property Tax Rates – Direct and Overlapping Governments ......................................... 168 Schedule 7 – Principal Property Taxpayers ......................................................................................... 169 Schedule 8 – Property Tax Levies and Collections.............................................................................. 170 Schedule 9 – Water Sold by Type of Customer and Wastewater Billed by Type of Customer ............ 171

Debt Capacity Schedule 10 – Ratio of Outstanding Debt by Type .............................................................................. 172 Schedule 11 – Direct and Overlapping Governmental Activities Debt ................................................. 172 Schedule 12 – General Revenue Bonds – Pledged Revenue Coverage ............................................. 174 Schedule 13 – Water-Wastewater Utility – Pledged Revenue Coverage ............................................. 176

V. Statistical Section (continued)

Demographic and Economic Information Schedule 14 – Demographic and Economic Statistics ......................................................................... 178 Schedule 15 – Principal Employers ..................................................................................................... 179

Operating Information Schedule 16 – Full-Time Equivalent Government – Employees by Function/Program ........................ 179 Schedule 17 – Operations Indicators by Function/Program ................................................................. 180 Schedule 18 – Capital Assets Statistics by Function ........................................................................... 181

VI. Single Audit Report

Independent Auditors’ 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 ............................................................................................................ 183

Independent Auditors’ Report on Compliance with Requirements that Could Have a Direct and Material Effect on Each Major Federal Program and on Internal Control Over Compliance in Accordance with OMB Circular A-133 ................................................................................................... 184

Schedule of Expenditures of Federal Awards ............................................................................................. 187 Schedule of Expenditures of State Financial Assistance ............................................................................ 188 Schedule of Findings and Questioned Costs .............................................................................................. 189

VII. Management Letter

Independent Auditors’ Management Letter ................................................................................................. 193 Independent Accountants’ Report ............................................................................................................... 199

Introductory Section

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City of Fort Myers, Florida FINANCIAL SERVICES ADMINISTRATION

PO Box 2217 Fort Myers, Florida 33902-2217

(239) 321-7147

March 18, 2016 To the Honorable Mayor, Members of City Council, and Citizens of Fort Myers, Florida We are pleased to present to you the Comprehensive Annual Financial Report (CAFR) of the City of Fort Myers, Florida (City) for the fiscal year ended September 30, 2015. State statutes require that a complete set of financial statements, presented in conformance with accounting principles generally accepted in the United States (GAAP), be audited by licensed, independent certified public accountants in accordance with auditing standards generally accepted in the United States and Government Auditing Standards within nine months after the end of the fiscal year. This report is published to fulfill those statutory requirements. Certain bond covenants require that this report be issued within 180 days of the City’s fiscal year end. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the management of the City. We believe the data, as presented, is accurate in all material aspects and is presented in a manner designed to fairly set forth the financial position and results of operations of the City on a government-wide and fund basis. All disclosures necessary to ensure the reader gains an understanding of the City’s financial activities have been included. Management of the City is responsible for establishing and maintaining internal controls designed to ensure that the assets of the City are protected from loss, theft or misuse and to ensure that sufficient, reliable, adequate accounting data is compiled for the preparation of financial statements in conformity with accounting principles generally accepted in the United States. Internal accounting controls have been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived and (2) the evaluation of costs and benefits requires estimates and judgments by management. We believe that the City’s internal controls adequately safeguard assets and provide reasonable assurance of properly recorded financial transactions. In compliance with the laws of the State of Florida, the City’s financial statements have been audited by CliftonLarsonAllen LLP, a firm of licensed, certified public accountants. The independent auditor issued an unqualified opinion that the City’s financial statements for the fiscal year ended September 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. Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s report and provides a narrative introduction, overview and analysis of the basic financial statements. MD&A complements this letter of transmittal and should be read in conjunction with it. Profile of the City Fort Myers, incorporated in 1886, is the oldest city in Lee County and serves as the county seat. Fort Myers is located on the lower west coast of Florida, midway between Tampa and Miami, and has a

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current population of approximately 72,395 residents. The City encompasses 48.82 total square miles, including waterways, and is bordered to the north and west by the Caloosahatchee River, which is part of the intercoastal waterway connecting the Atlantic Ocean and the Gulf of Mexico. The City operates under a council-manager form of government. Policy-making and legislative authority are vested in the governing council (Council) consisting of the mayor and six other members. The Mayor is elected at large, with one vote and no veto authority, and the six council members are elected by their respective wards. Council members serve four-year terms, with three members elected every two years. The Mayor is elected for a four-year term. The City Council is responsible for all policy-making functions of the government. The City Manager is responsible for the administration of the City. Municipal services provided to the citizens of Fort Myers include law enforcement, fire protection, community planning and development, traffic engineering, road and drainage construction and maintenance, parks and recreational activities/facilities, parking management, code enforcement and inspections, a cemetery, and other general governmental administrative services. The City also operates a utility system (including potable and reuse water and wastewater), solid waste services, building permits and inspections, stormwater management, golf courses, a yacht basin, an event center, parking garages, a skatium, historical homes and museum, and a hands-on children's science center. These additional operations are reported as enterprise funds that are intended to be, in most cases, self-supporting from user charges established by the City Council. The City is also financially accountable for the Community Redevelopment Agency of Fort Myers, which is included in the City’s reporting entity and financial statements. Additional information on this legally separate entity can be found in the notes to the financial statements (see Note 1, 2.) The City Council is required to adopt a final budget no later than the close of the preceding fiscal year to which the budget applies. The annual budget serves as the foundation for the City’s financial planning and control. The budget is prepared by fund, department (e.g. Public Works), and division (e.g. Recreation). In accordance with the City’s Budget Policy, the City Manager, Director of Finance and the Budget Manager have the authority to approve the transfer of funds within a department, within a fund, at will. In most cases, divisions are required to transfer funds only to meet unanticipated needs or to reflect organizational changes. Local Economy The City of Fort Myers is part of the Fort Myers-Cape Coral Metropolitan Statistical Area (MSA). The general concept of a metropolitan statistical area is one of a large population nucleus, together with adjacent communities that have a high degree of economic and social integration within that nucleus. Fort Myers is the cultural and trade center for Lee County and the surrounding area. Commercial fishing in Lee County is a year-round operation with shrimp fleets making their homeports in Fort Myers and Fort Myers Beach. For recreation, the Thomas Edison and Henry Ford Winter Estates offer tours of their exhibits including a museum, botanical gardens and research laboratory. The Barbara B. Mann Performing Arts Hall, located on the campus of Edison State College, operates year round and provides opportunities to see traveling artist and Broadway productions. JetBlue Park, a state-of-the-art training ballpark and player development complex, provides the facilities for spring training for the Boston Red Sox. In June 2015, Bloomberg Business compiled a list of the top 18 cities it predicts will achieve the most economic growth in 2016. For the past few years, oil towns dominated the ranks of fastest growing economies in the U.S. As the energy boom fades, retirement communities that are buoyed by a surge in baby boomers emerge as the leader. Florida dominated the ranks of the 18 metropolitan areas, comprising half of the top performers, and the Fort Myers-Cape Coral MSA ranked fourth, with predicted economic growth of 4.5 percent. Property values play a leading role in determining the strength of the City’s tax base. Certified taxable values increased 9.5%, adding $431,483,984 to the City’s tax base from $4,556,320,495 to

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$4,987,804,479. New construction contributed $202,266,876 to the increase along with existing property values increasing 5.0 percent. The increases are evidence of the continued recovery in the economy and marks the third consecutive year of gains to the City’s tax base following five years of decline. Even with the three years of gains in taxable value, the City’s cumulative change in valuation when the great recession began in December 2007 is still at a loss of 29 percent. Since the great recession and the recovery process that transpired over the past decade, the City experienced stronger but somewhat volatile job growth. The job growth is led by a resurgence in construction, which endured a sharp decline during the economic downturn and gradually turned around as consumer confidence increased, leading to business expansion and population growth. As evidence of the positive shifts, the City’s population continues to increase, from 69,413 in the prior fiscal year to 72,395 in the current fiscal year, a rate of 4.7 percent. Heading into fiscal year 2016, forecasts project stable and consistent growth in the job market, housing market and other facets of the local economy. A key metric of the local job growth and recovery process is the City’s unemployment rate, currently dipping to 5.2 percent as of September 30, 2015, in comparison to a rate of 5.7 percent from the prior fiscal year. The state’s unemployment rate is slightly higher, at a rate of 5.4 percent as of September 30, 2015. However, in October 2015, The Kiplinger Letter’s ranked Florida third among the fifteen fastest-growing states and projected an unemployment rate of 4.7 percent at the end of 2016. Over the past ten plus years, the City experienced rapid growth with strong residential appreciation and commercial construction due to its desirable location near the Gulf of Mexico. In response, the City updated and refined its redevelopment plan, which was undertaken by the Fort Myers Redevelopment Agency and completed in 1986 as part of the City’s aggressive revitalization program to address the decline in its central business district. Despite the effects of the great recession and the crash of the real estate market, the City completed its investment of $60+ million for a 50-block utility replacement and streetscape improvement project; received designation by the State of Florida as a Waterfronts Florida Community, and; restored over 20 historic downtown buildings. Combined with other major accomplishments, the success of the plan’s vision attracted new businesses downtown and invigorated the vibrancy of the riverfront atmosphere for local, regional and seasonal residents. With the continued growth in its tax base, job market and consumer confidence, the City has recovered from the fiscal stress of the recessionary years and expects to maintain financial stability as the economies continue to improve. During the past ten years, the City’s expenditures related to public safety experienced the greatest increase, not only in amount but also as a percentage of total expenditures in governmental funds (currently 52.3 percent, reflecting a ten-year increase of 14.8 percent). A major contributor to this increase is the salaries and benefits for police and firefighters escalating at a faster rate than for the City’s general employees. The City successfully negotiated contract ratifications with the City’s three unions, with an average 3.5 percent increase for police officers in comparison to the City’s contractual obligation for a 3.0 percent increase for general employees and firefighters in fiscal year 2016. During the same ten-year period, taxes related to governmental funds increased not only in amount, but also as a percentage of total revenues in governmental funds (currently 72.7 percent, reflecting a ten-year increase of 25.6 percent). While the City recognized increases in taxable value as a result of expansion and redevelopment efforts within the City, the decline in valuation during the great recession impacted the City’s available resources as the City adjusted its millage rate to supplement decreases in other revenue sources, such as grants and state shared revenues, which declined 10.0 percent over the last ten years as a percentage of total revenues in governmental funds. Long-Term Financial Planning and Major Initiatives In accordance with the City’s fund balance policy, the City will strive to maintain a minimum unassigned fund balance of 10% with an ultimate goal of 10% - 17% of the total General Fund budget. Unrestricted fund balance (the total of the committed, assigned, and unassigned components of fund balance) in the General Fund at year end was 18.2% of total General Fund revenues while unassigned fund balance was

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14.1% of revenues. The unassigned fund balance exceeds the minimum requirement of the goal set by the City Council for budgetary and planning purposes. The fiscal year 2016 budget reflects the improved conditions in the economy as it funds City priorities within the parameters of available revenues and principles of financial management. The budget provides modest increases in services in public safety, public works, information technology and community development. Highlights include a City match of $649,200 for a federal Community Oriented Policing Services grant to add nine new police officers to the City’s force to provide community policing and to address violent crime; funding for two positions in Public Works to enable separate crews for street and sidewalk repair, and; two downtown trolley routes at a total cost of $254,400 to mitigate traffic and enhance economic development. Strategic Plan The purpose of every government is to provide public safety, public services, and an enhanced community environment for its citizens. The City continuously strives to provide the services that citizens, business owners and visitors demand. Therefore, City Council and staff meet periodically to review and improve its Strategic Plan, which ensures the organization’s sustainability for the future and places emphasis on fiscal management. The Mission of the City of Fort Myers is to be financially responsible, and to be a leader in municipal services, with a dedicated City workforce, and an involved community. To support the new Strategic Plan, goals for the next five years comprise a financially sound city that provides exceptional municipal services; safe and livable neighborhoods; economic prosperity and a growing economy, and; a vibrant downtown on the river. The Strategic Plan complements the City’s 2010 Downtown Development Plan, which integrates the existing historic downtown area with a strategy to develop the neighboring riverfront and create a cultural destination. Consistent with the City’s goals for exceptional service and safe neighborhoods, the City invested $2.4 million for the replacement of nine hybrid, fuel efficient trash trucks in fiscal year 2015. Using federal Neighborhood Stabilization Program (NSP) funds, the City is successfully revitalizing neighborhoods by purchasing abandoned/foreclosed homes in target areas, rehabilitating and reselling them, and by building homes on city-acquired vacant lots that meet Florida Green and Energy STAR certification standards. This Program is part of the national effort to restore homes and renew neighborhoods affected the hardest by the housing crisis. In addition, funds for the repairs and rehabilitation of housing are available from both of the Community Development Block Grant and State Housing Initiative Partnership (SHIP) programs. The City’s business base continues to rebound as a result of the recovering economy and restoration of the downtown waterfront. The City works with fledgling businesses by providing a business incubator, the Southwest Florida Enterprise Center. This center provides space at very favorable rates and business classes to assist new entrepreneurs in starting up their businesses. The City partners with Florida Gulf Coast University to provide classes and assistance. Comprehensive Plan The City’s annual budget process includes the preparation of the five year Capital Improvement Program (CIP), which typically includes the construction of infrastructure and municipal facilities as well as the acquisition of large or specialized equipment. The capital planning process is critical to the City’s well-being because it provides the opportunity to take a planned and programmed approach to allocating financial resources in the most responsive and efficient manner necessary to meet Comprehensive Plan Level of Service requirements and general needs of the citizens. Furthermore, the City is required by Chapter 163.3177, Florida Statutes, to annually update the Capital Improvement Element of the City’s Comprehensive Plan.

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The City’s CIP incorporates needs identified in the CIE as required under the Growth Management legislation. The largest category of capital spending is Utilities, which includes improvement and replacement of water/sewer infrastructure and necessary regulatory equipment replacement and maintenance. For fiscal years 2016 through 2020, the City adopted the following five-year program: Utilities 183,670,722$

Transportation 16,871,908

Equipment 9,795,417

Stormwater 5,536,442

Development 4,550,000

Parks and Beautification 3,013,000

Buildings 2,397,250

Total 225,834,739$

The Capital Budget is the first year of the Capital Improvement Program and includes a list of projects to implement in that fiscal year. The fiscal year 2016 Capital Budget anticipates $35.5 million in capital projects, which comprises $23.8 million in Utilities improvements and replacements, $3.3 million for Transportation projects, $2.7 million for Equipment purchases, $1.1 million for Stormwater improvements and maintenance, $0.4 million in Parks and Beautification landscape improvements and enhancements to City recreation facilities, $1.9 million to Buildings purchases and improvements, and $2.3 million to Development for the improvements to neighborhoods and commercial business areas. Major projects included in the Capital Budget for fiscal year 2015 comprise $9.1 million for various neighborhood utility improvements, $4.1 million for equipment replacement and structural rehabilitation at the Central Advanced Wastewater Treatment Plant (CAWWTP) and $3.2 million for trunk sanitary sewer transmission main that travels to the CAWWTP. Funding these projects reflects the City’s commitment to meeting the standards set forth in its Comprehensive Plan and positively impact the quality of life for its residents, businesses and visitors. Relevant Financial Policies The City established guidelines that set forth the basic framework for the overall fiscal management of the City. With the development and implementation of the Strategic Plan, City management follows policies and procedures that further the growth and financial security of the City. Operating independently of changing circumstances and conditions, the financial policies guide the decision-making process of the City Manager, Mayor, City Council and Administration. These policies provide guidelines for evaluating both current activities and future programs. Any downward trends in the State and/or local economy will adversely impact the City’s ability to realize its budgeted revenues in the categories of franchise fees, utility taxes and state-shared revenues. Therefore, with quarterly monitoring and conservatism, the City mitigates any unforeseen circumstances. Complementing this practice is one in which a certain amount of expenses/expenditures are frozen and are not released for use until it is clear that revenues will be at projected levels. The City formally adopted a debt management policy during fiscal year 2008. There are no legal debt limits placed on the City through state law (no such limit exists in Florida), local ordinances or local resolutions. The City continually pursues ways to limit debt and improve its overall financial position by limiting future capital spending projects and minimizing the issuance of additional debt; taking advantage of refunding opportunities, if any arise, to decrease future annual debt service requirements, and restructuring existing debt, where legally possible, to remove the City's backup pledge on debt that benefits specific districts where sufficient revenues are available from those districts to repay the debt. The City does not issue debt, long or short term, to finance operational costs. While the City does not have any general obligation debt, certain underlying and implied ratings have been given to the City by the ratings companies. Fitch Ratings affirmed an A+ rating on September 28,

CITY OF FORT MYERS Organizational Chart As of September 30, 2015

Residents of Fort Myers

City Council as of Board of Commissioners of the

Community Redevelopment Agency

Elected Officials

City Attorney Grant W. Alley

City Manager

William P. Mitchell

Financial Services Maria Joyner

Director

Human Resources Christine McDade

Director

Police Dennis Eads Interim Chief

Fire Trenton Bowen

Chief

Information Technology ServicesJimmy R. Barfield

Director

City Clerk Marie Adams

Downtown Redevelopment Area

Donald Paight Executive Director

Other Redevelopment Areas Cleveland Avenue, Central Fort

Myers, Martin Luther King, Velasco Village, East Fort Myers, Eastwood

Village and Dunbar-Michigan Redevelopment Areas

Interim Assistant City Manager

Matthew Johnson

Community Development Robert Gardner

Director

Public Works Saeed Kazemi

Director

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Financial Section

CliftonLarsonAllen LLPCLAconnect.com

An independent member of Nexia International

INDEPENDENT AUDITORS’ REPORT

Honorable Mayor and City Council City of Fort Myers, Florida Fort Myers, Florida 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 the City of Fort Myers, Florida, (City) as of and for the year ended September 30, 2015, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. We have also audited the balance sheet, statement of revenues and expenditures and changes in financial position of the City of Fort Myers, Florida, Community Redevelopment Agency (CRA) presented in the accompanying combining and individual fund financial statements and schedules as of and for the year ended September 30, 2015. Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors’ Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America 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 auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the 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.

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Honorable Mayor and City Council City of Fort Myers, Florida

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of September 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. In addition, in our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the CRA as of September 30, 2015 and the respective changes in financial position thereof for the year ended in conformity with accounting principles generally accepted in the United States of America. Emphasis of Matter

As described in Note 24 to the financial statements, the City adopted the provisions of Governmental Accounting Standards Board Statement No. 68, Accounting and Financial Reporting for Pensions for the year ended September 30, 2015. Our opinion was not modified with respect to this matter. As described in Note 24 to the financial statements, the City corrected an error in reporting solid waste tipping fees. Our opinion was not modified with respect to this matter. Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 4 - 16, budgetary comparison information for the general fund on pages 98 - 99 and the employees’ pension and other postemployment benefits schedules on pages 100 - 109 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. Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. The schedule of expenditures of federal awards as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations and the schedule of expenditures of state financial assistance are also presented for purposes of additional analysis and are not a required part of the basic financial statements.

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The combining and individual fund statements and schedules and the schedule of expenditures of federal awards and the schedule of expenditures of state financial assistance are the responsibility of management and were derived from and relate 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 information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections 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. Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated March 18, 2016, on our consideration of the City'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 result of that testing, and not to provide an opinion on 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’s internal control over financial reporting and compliance.

CliftonLarsonAllen LLP

Fort Myers, Florida March 18, 2016

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CITY OF FORT MYERS, FLORIDA Management’s Discussion and Analysis

As management of the City of Fort Myers (the City), we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended September 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, which can be found on pages i-vi of this report, and the City’s financial statements beginning on page 17. Financial Highlights:

The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $123,433,353 (net position). Of this amount, $(111,645,901) represents unrestricted net position, which usually may be used to meet the government’s ongoing obligations to citizens and creditors. Due to the City’s adoption of Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, unrestricted net position at the end of the current fiscal year reflects a negative amount as a result of the measurement and recognition of the City’s net pension liabilities for the City’s three defined benefit plans.

The government’s total net position increased by $13,319,253, which comprises a decrease in governmental activities of $3,670,588 offset by an increase in business-type activities of $16,989,841. The overall increase includes adjustments to beginning net position of $144.5 million, which affected both governmental and business-type activities. The adjustments were a result of the provisions of GASB Statement No. 68, and Note 24 provides additional information about these adjustments. The decrease in the governmental activities includes an accrual related to a developer agreement; see Note 15. Business-type activities experienced an increase in net position due to increases in the water and sewer utility rate and capital grants revenue.

At the close of the current fiscal year, the City’s governmental funds reported combined fund balances of $81,868,785, a decrease of $9,789,411 (10.7%) in comparison with the prior year. Approximately 13.5% of this amount ($11,046,731) is available for spending at the government’s discretion (unassigned fund balance).

At the end of the current fiscal year, unrestricted fund balance (the total of the committed, assigned, and unassigned components of fund balance) for the General Fund was $14,239,047, or 18.1% of total General Fund expenditures.

The City’s total outstanding long-term debt decreased by $18,010,831 (4.9%) during the current fiscal year as a result of prevailing debt service payments.

Overview of the Financial Statements The discussion and analysis provided here are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to financial statements. This report also includes supplementary information intended to furnish additional detail to support the basic financial statements themselves. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private sector business. The Statement of Net Position presents information on all of the City’s assets, liabilities, and deferred outflows/inflows of resources, with the difference reported as net 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. The Statement of Activities presents information showing how the 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 for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental activities (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 reflects the City’s basic services, including general government, community and economic development, planning and zoning, police, fire, public works, parks and recreation, and the Community Redevelopment Agency. The business-type activities of the City include a water and wastewater utility, solid waste collection, building permits

4


and inspections, stormwater management, golf courses, a yacht basin, an event center, downtown parking garages, a skatium, historical homes and museum, and a hands-on science education center. The government-wide financial statements include not only the City itself (known as the primary government), but also the Community Redevelopment Agency, a legally separate entity for which the City is financially responsible. Financial information for this component unit is included in the governmental-type funds as a non-major special revenue fund. The government-wide financial statements can be found on pages 17 – 19 of this report. Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental 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 Funds Balance Sheet and the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances provide a reconciliation to the government-wide statements in order to facilitate this comparison between governmental funds and governmental activities. The City maintains twenty-five individual governmental funds. Information is presented separately in the Governmental Funds Balance Sheet and in the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances for the General Fund, the Revenue Bonds and Notes Fund, the Transportation Capital Projects Fund and the General Capital Projects Fund, which are considered to be major funds. Data from the other twenty-one governmental funds are combined into a single, aggregated presentation titled Other Governmental Funds. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements in the Combining Statements and Schedules section of this report. The City adopts an annual appropriated budget for the governmental funds with the exception of the two capital projects funds, which are budgeted on a project length basis. A budgetary comparison schedule has been provided for the General Fund and the Revenue Bonds and Notes Fund to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 20 – 26 of this report. Proprietary funds. The City maintains two different types of proprietary funds: Enterprise Funds and Internal Service Funds. Enterprise Funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its Water and Wastewater Operations, Solid Waste Operations, Building Permits and Inspections, Stormwater Management, Fort Myers Country Club, Eastwood Golf Course, the Yacht Basin, Harborside Event Center, Downtown Parking Garages, Skatium, and the Department of Cultural and Historic Affairs, which comprises the business activities of the Imaginarium Science Center, the Burrough’s Home, and the Southwest Florida Museum of History. Internal Service Funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses separate internal service funds to account for its Central Garage Operations, Information Technology Services, Public Works Warehouse, and Risk Management Program. Because all of these services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Proprietary fund financial statements provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the Water-Wastewater Fund and the Solid Waste Fund, both of which are considered to be major funds of the City. The remaining enterprise funds are combined into a single, aggregated presentation titled “Other Enterprise Funds”. The internal service funds are combined into a single, aggregated presentation in the proprietary fund financial

5


statements. Individual fund data for the nonmajor enterprise funds and the internal service funds are provided in the form of combining statements in the Combining Statements and Schedules section of this report. The basic proprietary fund financial statements can be found on pages 27 – 29 of this report. Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside of the government. Fiduciary funds are not reported in the government-wide financial statements because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The City maintains two different types of fiduciary funds: pension trust funds and agency funds. Pension trust funds are used to report resources held in trust for retirees and beneficiaries covered by each plan. The three pension trust funds are: 1) the General Employees’ Pension Plan, 2) the Police Officers’ Retirement System, and 3) the Firefighters’ Retirement System. Agency funds report resources held by the City in a custodial capacity for individuals, private organizations, and other governments. The five agency funds are: 1) the Regional Park Impact Fee Fund, which accounts for regional park impact fees collected and then sent to Lee County; 2) the Emergency Medical Services (EMS) Impact Fee Fund, which accounts for the EMS impact fees collected and then sent to Lee County; 3) the School Board Impact Fee Fund, which accounts for school impact fees collected and then sent to Lee County; 4) Unclaimed Funds, which accounts for monies that have not been claimed and then sent to the State of Florida according to State Statutes; and 5) the Employee Special Events Fund, which is accounted for and held by the City for a committee that provides special events for employees. The fiduciary fund financial statements can be found on pages 30 and 31 of this report. Notes to the financial statements. The notes provide additional information that is necessary to acquire a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 33 – 95 of this report. Other information. In addition to the basic financial statements and accompanying notes, this report also presents required supplementary information concerning the budget to actual data for the General Fund, certain information for the City’s pension plans, and the City’s progress in funding its obligation to provide other postemployment benefits (OPEB) to its employees. Required supplementary information can be found on pages 98 – 109 of this report. The combining statements referred to earlier in connection with nonmajor governmental funds, nonmajor enterprise funds and internal service funds are presented immediately following the required supplementary information on the budgetary comparison schedule, pensions and OPEB. The combining and individual fund statements and schedules can be found on pages 116 – 156 of this report. Government-wide Overall Financial Analysis As noted earlier, net position over time may serve as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $123,433,353 at the close of the most recent fiscal year. The largest portion of the City’s net position ($136,282,885) reflects its investment in capital assets (e.g., land, buildings, equipment, vehicles and infrastructure), less any related outstanding debt that was used to acquire those assets. The City uses these capital assets to provide a variety of services to its citizens. Accordingly, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources used to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the City’s net position (80%) represents resources that are subject to external restrictions on how they may be used. Restrictions related to capital projects represent 46.2% of the total restricted net position ($98,796,369) and reflects the City’s commitment to providing services and resources to its citizens. The remaining balance of $(111,645,901) is unrestricted and usually may be used to meet the City’s ongoing obligations to its citizens and creditors. As noted in the Financial Highlights, the balance of the unrestricted net position is negative for the current fiscal year due to the City’s adoption of GASB 68. Representation of the City’s net position is on the following page.

6


Current and other assets $ 111,629,848 $ 125,165,953 $ 99,606,402 $ 98,735,636 $ 211,236,250 $ 223,901,589 Capital assets 147,729,277 148,584,267 341,739,187 334,873,448 489,468,464 483,457,715

Total assets 259,359,125 273,750,220 441,345,589 433,609,084 700,704,714 707,359,304

Deferred outflows of

resources 20,032,913 3,670,889 2,768,586 427,020 22,801,499 4,097,909

Long-term liabilities

outstanding 265,956,534 132,583,003 285,157,865 269,710,514 551,114,399 402,293,517

Other liabilities 26,991,228 34,184,754 19,272,688 17,956,098 46,263,916 52,140,852

Total liabilities 292,947,762 166,767,757 304,430,553 287,666,612 597,378,315 454,434,369

Deferred inflows of

resources 293,951 - 2,400,594 2,405,962 2,694,545 2,405,962

Net position:

Net investment in

capital assets 54,323,549 49,609,728 81,959,336 66,890,713 136,282,885 116,500,441

Restricted 58,007,927 61,743,479 40,788,442 35,422,702 98,796,369 97,166,181

Unrestricted (126,181,151) (699,855) 14,535,250 41,650,115 (111,645,901) 40,950,260 Total net position $ (13,849,675) $ 110,653,352 $ 137,283,028 $ 143,963,530 $ 123,433,353 $ 254,616,882

2015 2014

Business-type Activities Total

City of Fort Myers, FloridaNet Position as of September 30, 2015 and 2014

2015 2014

Governmental Activities

2015 2014

At the end of the current fiscal year, the City reported some fund deficits in the unrestricted category of net position, both for the government as a whole as well as for some separate governmental and business-type activities. The adoption of the new GASB statement depleted unrestricted funds in governmental activities. The Grants and Community Development Block Grant special revenue funds had fund deficits resulting from expenditures for which related revenue was not recognized due to the timing of the reimbursements. For business-type activities, enterprise funds with negative unrestricted net position comprised Solid Waste, $(378,258), Fort Myers Country Club, $(309,812), Eastwood Golf Course, $(778,254), Yacht Basin, $(45,985), Harborside Event Center, $(964,100), Skatium, $(538,095), and the Department of Cultural and Historic Affairs, $(763,444). The negative unrestricted net position for each enterprise fund was the result of the adoption of GASB Statement No. 68, Accounting and Financial Reporting for Pensions, which is discussed in Note 24.

-150,000,000 -100,000,000 -50,000,000 0 50,000,000 100,000,000 150,000,000

Net investment in capital assets

Restricted

Unrestricted

City of Fort Myers, Florida Net PositionSeptember 30, 2014 and 2015

2014 2015

7


The City’s overall net position increased $13,319,253 from the prior fiscal year. The reasons for this overall increase are discussed in the following sections for governmental activities and business-type activities.

Revenues:

Program Revenues

Charges for services $ 12,116,186 $ 9,618,819 $ 98,723,327 $ 90,953,023 $ 110,839,513 $ 100,571,842

Operating grants and

contributions 2,908,307 4,082,848 1,646 933 2,909,953 4,083,781

Capital grants and

contributions 1,217,297 2,767,330 6,968,886 8,647,869 8,186,183 11,415,199

General Revenues

Property taxes 39,540,177 36,692,230 - - 39,540,177 36,692,230

Other taxes 23,340,843 22,976,391 - - 23,340,843 22,976,391

Other 10,274,231 10,133,248 315,165 97,115 10,589,396 10,230,363

Total revenues 89,397,041 86,270,866 106,009,024 99,698,940 195,406,065 185,969,806

Expenses:

General government 9,914,148 12,200,476 - - 9,914,148 12,200,476

Police 35,863,633 36,183,148 - - 35,863,633 36,183,148

Fire 19,496,788 20,189,676 - - 19,496,788 20,189,676

Protective inspections 1,546,049 1,448,884 - - 1,546,049 1,448,884

Physical environment 5,882,766 5,754,949 - - 5,882,766 5,754,949

Transportation 17,111,271 19,957,055 - - 17,111,271 19,957,055

Economic environment 4,184,294 6,199,726 - - 4,184,294 6,199,726

Culture and recreation 3,635,056 3,759,704 - - 3,635,056 3,759,704

Interest 4,481,774 5,118,896 - - 4,481,774 5,118,896

Water-Wastewater - - 49,841,779 46,061,313 49,841,779 46,061,313

Solid Waste - - 9,642,121 8,878,238 9,642,121 8,878,238

Permits and Inspections - - 3,129,113 2,836,337 3,129,113 2,836,337

Stormwater - - 3,134,327 2,802,742 3,134,327 2,802,742

Golf Courses - - 4,425,763 3,251,488 4,425,763 3,251,488

Yacht Basin - - 2,587,863 2,816,344 2,587,863 2,816,344

Harborside Event Center - - 3,280,921 2,004,116 3,280,921 2,004,116

Downtown Parking Garages - - 1,049,490 1,039,313 1,049,490 1,039,313

Skatium - - 1,250,814 1,223,048 1,250,814 1,223,048

Cultural and Historic Affairs - - 1,628,842 1,584,912 1,628,842 1,584,912

Total expenses 102,115,779 110,812,514 79,971,033 72,497,851 182,086,812 183,310,365

Increase (decrease) in net

position before transfers (12,718,738) (24,541,648) 26,037,991 27,201,089 13,319,253 2,659,441

Transfers 9,048,150 3,216,328 (9,048,150) (3,216,328) - -

Increase (decrease) in net

position (3,670,588) (21,325,320) 16,989,841 23,984,761 13,319,253 2,659,441

Net position - beginning of year

as previous;y reported 110,653,352 131,978,672 143,963,530 119,978,769 254,616,882 251,957,441

Adjustments (See note 24) (120,832,439) - (23,670,343) - (144,502,782) -

Net position – beginning of year

as restated (10,179,087) 131,978,672 120,293,187 119,978,769 110,114,100 251,957,441 Net position – ending $ (13,849,675) $ 110,653,352 $ 137,283,028 $ 143,963,530 $ 123,433,353 $ 254,616,882

20142015 2014 2015 2014 2015

Governmental Activities Business-type Activities Total

City of Fort Myers, Florida

Changes in Net Position

For the Year Ended September 30, 2015 and 2014

Governmental Activities. During the current fiscal year, net position for governmental activities decreased $3,670,588 from the prior fiscal year for an ending balance of $(13,849,675). While the recovering economy attributed to an increase in revenue collections, the increase was negated by the compliance with a buyback commitment in a developer agreement that resulted in an accrual of $6,000,000. Note 15 provides additional details about this transaction.

8


$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

Expenses and Program Revenues - Governmental Activities

Revenues Expenses

Charges for Services13.55%Operating Grants and

Contributions3.25%

Capital Grants and Contributions

1.36%

Property Taxes44.23%

Public Service Taxes12.45%

Franchise Taxes6.25%

Local Business Taxes2.09%

Fuel Taxes5.32%

Intergovernment9.74%

Interest0.27%

Miscellaneous1.49%

Revenues by Source - Governmental Activities

Business-type Activities. For the City’s business-type activities, the results for the current fiscal year were positive in that overall net position increased to an ending balance of $137,283,028. The total increase in net position for business-type activities was $16,989,841 or 14.1% from the prior fiscal year, which includes an adjustment to beginning net position of $(23,670,343). The growth is attributable to the 4% increase in the water and sewer utility rate that was effective October 1, 2014 and growth in the utility customer base.

9


$0$10,000,000$20,000,000$30,000,000$40,000,000$50,000,000$60,000,000$70,000,000$80,000,000

Expenses and Program Revenues - Business-Type Activities

Revenues Expenses

Water-Wastewater Charges for Services

62.25%Solid Waste Charges for

Services13.90%

Other Charges for Services16.97%

Capital Grants and Contributions

6.57%

Miscellaneous0.15%

Interest0.16%

Revenues by Source - Business-Type Activities

10


Financial Analysis of the City’s Funds As noted earlier, 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, unassigned fund balance may serve as a useful measure of a government’s net resources available for discretionary use as they represent the portion of fund balance that has not yet been limited to use for a particular purpose by either an external party, the City itself, or a group or individual that has been delegated authority to assign resources for use for particular purposes by City Council. At September 30, 2015, the City’s governmental funds reported combined fund balances of $81,868,785, a decrease of $9,789,411 in comparison with the prior year. Approximately 13.5% of this amount, $11,046,731, constitutes unassigned fund balance, which is available for spending at the City’s discretion. The remainder of the fund balance is either nonspendable, restricted, committed or assigned to indicate that it is 1) not in spendable form, ($889,440), 2) legally required to maintain intact, ($2,000), 3) restricted for particular purposes, ($66,686,745), 4) committed for particular purposes, ($66,838), or 5) assigned for particular purposes, ($3,177,031).

$0 $5,000,000 $10,000,000 $15,000,000

Unassigned

Assigned

Nonspendable

General FundComponents of Fund BalanceSeptember 30, 2014 and 2015

2014

2015

($100,000) $19,900,000 $39,900,000 $59,900,000 $79,900,000 $99,900,000

Unassigned

Assigned

Committed

Restricted

Nonspendable

Other Governmental FundsComponents of Fund BalanceSeptember 30, 2014 and 2015

2014

2015

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The General Fund is the primary operating fund of the City. At the end of the current fiscal year, unassigned fund balance of the General Fund was $11,064,377 while total fund balance decreased to $14,869,352. As a measure of the General Fund’s liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 14.1% of total General Fund expenditures, while total fund balance represents 18.9% of that same amount. It should be noted that the budget for fiscal year 2015-2016 provides for using $1,544,078 of the assigned fund balance to support General Fund expenditures in that fiscal year. The fund balance of the City’s General Fund decreased $774,114 during the current fiscal year. The increase in total revenues over prior year of $5,580,547 is an indication of a recovering economy but revenues remained deficient over expenditures by $82,996. Expenditures increased over prior year by $4,238,830, mainly due to Police and Fire pension expenditures along with a 3% wage restoration for employees. In addition, transfers out exceeded contributions from other funds by $691,118. The Revenue Bonds and Notes Fund, a major fund, had a decrease in fund balance during the current year of $379,875 to bring the year end fund balance to $5,241,087. Debt service obligations exceeded transfers from other funds and the budget incorporated the use of prior years’ savings to offset the deficiency. The Transportation Capital Projects Fund, a major fund, had a $3,867,056 decrease in fund balance during the current year. The primary factor for the decrease were expenditures incurred for the Hanson Street Extension, $2,924,388. The General Capital Projects Fund, the remaining major governmental fund, had a $4,754,981 decrease in fund balance during the current fiscal year. Capital outlay for general government included $858,584 for the fiber optic infrastructure project while capital outlay for fire mainly comprised expenditures for the new Fire Station #1 building, $1,300,451. In addition, transfers to other funds included $1,130,730 for street overlay improvements. Proprietary Funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. Unrestricted net position of the Water-Wastewater Fund at the end of the year amounted to $13,071,097, and total growth in net position for the year was $15,157,271. As discussed earlier in connection with business-type activities, the increase primarily results from the increase in the water and sewer activity charges due to customer growth and the 4% rate increase in the current fiscal year. Miscellaneous revenue increased $1,838,341 due to the continued surge in impact fee collections after the water and sewer impact fee waiver program expired on January 1, 2014. Unrestricted net position of the Solid Waste Fund at the end of the year amounted to $(378,258), and total change in net position for the year was $453,769. The increase of $323,901 in revenues occurred primarily in roll-off and commercial pickup revenues, and the auction of some sanitation trucks and roll-off containers added $87,500 to the change in net position. Unrestricted net position of the Other Enterprise Funds at the end of the year amounted to $1,842,411 and total growth in net position for the year was $1,378,801. Charges for services in the Building, Permits and Inspections Fund increased by $935,382, mainly as a result of the ongoing increase in single-family permits issued for new construction. Charges for services for the Fort Myers Country Club replenished $646,227 in comparison to prior year due to the closure in fiscal year 2014 for renovations to the golf course. Rental income for the Harborside Event Center increased $1,257,860 with a parallel increase of $1,202,245 in contractual services due to a change in event processing. Increases in revenues for total nonmajor enterprise funds offset the overall increase of $174,562 in personnel services, which was mainly due to the wage restoration to City employees. General Fund Budgetary Highlights Original budget compared to final budget. During the year, there was no need for any significant amendments to increase either the original estimated revenues or original budgeted appropriations. In accordance with Florida Statute 166.241(4), the City makes any necessary amendments to the current fiscal year budget up to sixty days after the completion of the fiscal year. Year end results generally indicate that some budget adjustments are necessary to be in compliance with the City’s legal level of control, which is the department level within a fund for budget purposes. These adjustments may be administrative, where both revenues received and the related expenditures are recognized, or where some funds/departments experienced unexpected expenditures and/or revenue shortfalls that require either the appropriation of reserves or the transfer of funds within the fund. The most significant adjustments in the fiscal year 2014-2015 budget amendments were as follows:

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An increase of $1,209,465 in General Fund appropriations with funding coming from fund balance or

reserves – Of this amount, $689,589 is attributable to re-appropriated funds to complete capital improvement projects that were approved in prior fiscal years, as the fiscal year 2015 original budget included only new funding for projects. Other re-appropriated funds include $450,376 for purchase order encumbrances and $66,394 for facilities special projects not completed in fiscal year 2014.

An increase of $1,483,769 in General Fund Revenues and Expenditures for the collection of insurance premium taxes – The City receives state contributions for the City’s portion of the Fire and Police Insurance Premium Taxes, in the amounts of $841,430 and $642,339, respectively. The taxes are not budgeted because the amounts cannot be reasonably estimated.

Final budget compared to actual results. The following revenues and expenditures caused the largest variances between estimated amounts and actual results:

Budgeted AmountsOriginal Final

REVENUESTaxes $ 56,534,900 $ 58,018,669 $ 58,571,143 $ 552,474 Permits and fees 4,910,300 5,040,800 4,050,470 (990,330) Intergovernmental revenue 6,900,500 6,900,500 7,355,221 454,721 Fines and forfeitures 656,700 656,700 518,404 (138,296) Miscellaneous 216,200 1,504,090 1,093,237 (410,853)

EXPENDITURESCurrent:

General Government -City Clerk 1,330,800 1,224,230 1,089,622 134,608 Human Resources 1,121,200 1,029,083 916,094 112,989 General Contingencies (1,480,000) (1,402,368) - (1,402,368)

Physical Environment - Public Works 6,014,900 6,239,759 5,968,175 271,584

Culture and Recreation -

OTHER FINANCING SOURCES (USES)Transfers out:

Capital funding transfers out (171,500) (740,304) (320,606) 419,698

Variance withFinal Budget(Budgetary Basis)

Actual Amounts

Taxes came in favorable to the budget by $552,474 due to better than expected collections in Utility Service Taxes, Ad Valorem revenues, Franchise Fees and Business taxes, offset by a decrease in the Communications Service Tax. Permits and fees came in less than budget by $990,330 due to the net effect of better than expected collections in licenses and permits, offset by less than originally planned collections from a newly implemented fire assessment fee. The original budget for the fire assessment fee was based on a 28.0% cost recovery of fire services. However, subsequent to budget adoption during the public hearing process to adopt the fee, the cost recovery % was lowered to 17.5%, generating less revenue. Intergovernmental revenue came in favorable to the budget by $454,721 due to the recovering economy and an increase in population, which improved sales tax collections. Fines and forfeiture revenues came in less than budget by $138,296 as the collections continue to trend downward. Miscellaneous revenues are $410,853 less than budget, which is the net effect of collections coming in more than planned plus a distribution from the State Board of Administration, offset by appropriated reserves of $698,665 used strictly for budgeting purposes. Reserves are budgeted to balance the fiscal year budget and to complete capital improvement projects and professional services that were unable to be completed in the prior year. Savings in General Government – City Clerk result from election and other operating expenditures. Savings in Human Resources result from contract services for the City Manager search and a compensation and job classification study that will not be completed until fiscal year 2016. General contingencies consist of a budgetary account only, the final budget amount of ($1,402,368) representing annual, projected General Fund expenditure savings.

13


Savings in Physical Environment – Public Works result from professional services for various engineering services that were budgeted but not able to start or be completed by the end of the fiscal year. Since the services were planned and encumbered, the budgets were carried over to fiscal year 2016 for completion. Transfers for capital improvement projects were less than budget due to projects that were not completed by the end of the fiscal year. The unspent budget for any project that was incomplete at year end was carried over into fiscal year 2016. A review of actual expenditures compared to the appropriations in the final budget yields no significant variances. As discussed earlier, City divisions spent according to or less than their budgets with the exception of the Police Department due to higher than expected expenditures in overtime, which resulted in a variance of $(27,907). Capital Assets and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of September 30, 2015 amounts to $489,468,464 (net of accumulated depreciation). This investment in capital assets includes land, antiques and exhibits, historical buildings, construction in progress, building, improvements (including utility systems), intangible assets and infrastructure. The total increase in the City’s investment in capital assets for the current fiscal year was 1.2% ($6,010,749).

Land $ 25,354,441 $ 25,385,341 $ 3,788,143 $ 3,788,143 $ 29,142,584 $ 29,173,484

Antiques and exhibits 251,871 251,871 - - 251,871 251,871

Intangibles-easements 3,561,031 3,560,054 - - 3,561,031 3,560,054 Buildings 11,001,083 11,318,159 31,355,603 34,146,236 42,356,686 45,464,395 Improvements and Infrastructure 95,452,255 100,382,851 20,754,694 21,426,590 116,206,949 121,809,441 Utility Systems - - 269,895,801 267,178,020 269,895,801 267,178,020

Equipment 3,255,463 3,732,048 10,509,184 7,059,886 13,764,647 10,791,934

Intangibles-software 13,407 16,904 281,270 187,410 294,677 204,314 Construction in progress 8,839,726 3,937,039 5,154,492 1,087,163 13,994,218 5,024,202

Total capital assets $ 147,729,277 $ 148,584,267 $ 341,739,187 $ 334,873,448 $ 489,468,464 $ 483,457,715

2015 20142015 2014 2015 2014

Activities TotalActivities

City of Fort Myers, FloridaCapital Assets

Business-typeGovernmental

(net of depreciation)

Major capital asset activity during the current fiscal year included the following:

Various projects related to street overlay improvements and citywide drainage rehabilitation at a cost of $1,185,149.

Additions to construction in progress for a total of $4,902,687 that comprises $1,300,451 in current year expenditures for the Fire Station 1 Building and $2,924,388 for the Hanson Street Extension for Cocos to Ortiz Avenue.

Various neighborhood utility improvements for a total cost of $7,397,758, with significant improvements to the McGregor boulevard area waterline, Cortez Boulevard utility improvements and Barcelona / Alcazar utility infrastructure replacements.

Drainage improvements for Ford Street Canal at a cost of $1,331,418 in current year expenses added to construction in progress.

Dean Park neighborhood improvements at a cost of $953,597 in current year expenses added to construction in progress.

Additional information on the City’s capital assets can be found in Note 8 on pages 61 and 62 of this report.

14


Long-term debt. At the end of the current fiscal year, the City had total bonded debt outstanding of $226,470,001, of which $128,145,000 was related to the Water-Wastewater System. The remaining bonded debt is backed by specified revenue sources. In addition, the City had $124,449,411 of notes and loans outstanding. Of this amount, $120,656,162 relates to the City’s Water-Wastewater System. The remainder of the City’s long-term obligations consists of capital leases.

Revenue Bonds $ 97,757,190 $ 104,570,225 $ 567,811 $ 629,776 $ 98,325,001 $ 105,200,001

Utility Revenue Bonds - - 128,145,000 134,020,000 128,145,000 134,020,000

Capital Lease

Obligations 503,825 701,868 509,060 - 1,012,885 701,868

Notes and Loans 3,793,249 3,994,230 120,656,162 126,027,029 124,449,411 130,021,259Total long-term debt $ 102,054,264 $ 109,266,323 $ 249,878,033 $ 260,676,805 $ 351,932,297 $ 369,943,128

Governmental Activities Business-type Activities

2015 2014 2015 2014

City of Fort Myers, FloridaBonded Debt and Loans Payable

2015 2014

Total

The City’s total debt decreased $18,010,831 or 4.9%. The key factors in this decrease were:

The governmental activities revenue bonds decreased $6,813,035 (6.5%) due to normal amortization of debt service.

Business-type debt decreased $10,798,772 (4.1%) due to normal amortization of debt service. The business-type activities include capital lease obligations, which the City used to finance the acquisition

of certain equipment that was essential to maintain the City’s two golf courses. The lease agreements qualify as capital leases for accounting purposes and therefore, have been recorded at the present value of the future minimum lease payments as of the inception dates.

Additional information on the City’s long-term debt can be found in Note 15 on pages 84 – 89 of this report and in the City’s Annual Report to Bondholders, published separately. Economic Factors and Next Year’s Budgets and Rates The following economic factors currently affect the City and were considered in developing the 2015-2016 fiscal year budget.

The City’s unemployment rate for September 30, 2015 is 5.2%, which is a slight improvement from a rate of 5.7% a year ago and a positive indicator of the continued recovery from the prolonged economic downturn.

The increase of $431.5 million (9.5%) in the City’s certified taxable property values, with $202.3 million in new construction and average increases of 5.0% in existing properties, will provide $3.3 million in additional Ad Valorem revenue.

Revenue in the amount of $2.2 million generated from a fire assessment fee will recover an estimated 16.6% of the cost to provide fire suppression and rescue services.

The City maintained millage rate of 8.7760 to preserve core municipal services and avoid the depletion of City fiscal reserves.

Maintenance of the Water and Sewer rates, Solid Waste rates and Stormwater fees. An increase in Skatium facility recreation and ice program fees, generating additional revenue in the

estimated amount of $43,000. On the expenditure side, a 1 step increase for Fire and Police union employees provides a 3.0% and an

average of 3.5% wage increase, respectively. In addition, General union and non-union employees will receive a 3.0% wage increase. Estimated total cost is $1.4 million.

Health insurance premiums increase 3% and pension contributions for each of the City’s pension plan increase due to the wage increases and reductions in payroll growth assumptions.

Funding of seventeen vacant General Fund positions will remain frozen while twenty-five new positions comprise a Fire inspector, Solid Waste billing specialist, a roll-off operator II, an ITS network security administrator and twenty-one Firefighters, whose positions in the Fire Department are funded by a grant from the US Department of Homeland Security.

15


The addition of $1.2 million to the Police Department budget that includes $550,000 for police cruisers and

$649,200 for a City match for a grant from the US Department of Justice that provides an additional nine Police Officer positions.

Removes $1.5 million of expenditure savings, which was incorporated in prior years in response to budgetary gaps. Stronger revenue streams allow for the discontinuance of this practice.

The City continues to purchase property and casualty insurance to ensure adequate coverage in the event of a natural peril or unforeseen accident claim.

An increase of 4.3% in the City’s population from 69,413 in fiscal year 2014 to 72,395 in the current fiscal year requires the maintenance of service delivery to the citizens of Fort Myers.

Successful contract ratifications with the City’s three unions. During the current fiscal year, the unassigned fund balance in the general fund was $11,064,377. The City appropriated $1,544,078 of this amount for spending in the 2015-2016 fiscal year budget. This action was necessary to complete certain capital projects and provide services that were unable to be completed by the end of fiscal year 2015 while keeping service levels stable for core municipal services, such as police, fire and public works, and accommodating equipment and software purchases in fiscal year 2016. The amount of the appropriation is considerably less than previous years due to City Council adhering to their goal of maintaining reserves in accordance with City Council’s policies and the expectations of municipal credit rating agencies. Requests for information The financial report is designed to provide users with a general overview of the City of Fort Myers’ finances. Questions concerning any of the information provided in this report, or requests for additional financial information, should be addressed to the Director of Finance, PO Box 2217, Fort Myers, Florida 33902-2217 or telephone (239) 321-7147. You can also access our website at www.cityftmyers.com.

16

Basic Financial Statements

ASSETSCash and cash equivalents $ 23,299,934 $ 22,975,509 $ 46,275,443 Investments 11,025,548 10,407,725 21,433,273 Accounts receivable, net 3,094,397 8,122,349 11,216,746 Special assessments receivable 682,689 - 682,689 Interest receivable 153,631 47,238 200,869 Due from other governments 2,415,146 6,752,516 9,167,662 Internal balances 780,061 (780,061) - Inventories 635,861 462,775 1,098,636 Prepaid items 286,815 491,438 778,253 Deferred special assessments receivable 5,450 - 5,450 Notes receivable 6,155,326 - 6,155,326 Allowance for notes receivable (6,155,326) - (6,155,326) Assets held for resale 519,010 - 519,010 Restricted assets:

Cash and cash equivalents 47,105,398 36,932,320 84,037,718 Investments 21,310,092 13,977,523 35,287,615 Interest receivable 1,787 16,080 17,867

Unamortized bond insurance costs 314,029 200,990 515,019 Capital assets, net:

Non-depreciable 38,007,069 9,223,905 47,230,974 Depreciable 109,722,208 332,515,282 442,237,490

Total Assets 259,359,125 441,345,589 700,704,714

DEFERRED OUTFLOWS OF RESOURCESDeferred charge on refunding 3,398,988 404,951 3,803,939 Deferred outflows on pension earnings 16,633,925 2,363,635 18,997,560

Total deferred outflows of resources 20,032,913 2,768,586 22,801,499

LIABILITIESAccounts and contracts payable 4,489,387 7,215,403 11,704,790 Accrued and other liabilities 5,231,123 166,791 5,397,914 Accrued interest payable 1,525,791 4,517,801 6,043,592 Accrued retirement payable 14,096,699 - 14,096,699 Due to other governments 512,458 161,407 673,865 Unearned revenues 761,279 - 761,279 Customer deposits 374,491 7,211,286 7,585,777 Noncurrent liabilities:

Due within one year 15,694,197 11,945,275 27,639,472 Due in more than one year 246,742,725 273,212,590 519,955,315

Accrued contingencies:Claims and judgments 3,519,612 - 3,519,612

Total Liabilities 292,947,762 304,430,553 597,378,315

DEFERRED INFLOWS OF RESOURCESDeferred charge on refunding - 2,202,149 2,202,149 Deferred inflows related to pensions 293,951 198,445 492,396

Total deferred inflows of resources 293,951 2,400,594 2,694,545

NET POSITIONNet investment in capital assets 54,323,549 81,959,336 136,282,885 Restricted for:

Capital projects 31,831,335 13,798,738 45,630,073 Culture and recreation 157,454 2,147 159,601 Debt service 5,241,087 10,125,372 15,366,459 Economic environment 3,384,862 - 3,384,862 Impact fee projects 14,982,630 6,549,995 21,532,625 Public safety:

Nonexpendable 2,000 - 2,000 Expendable 646,857 - 646,857

Renewal and replacement - 10,292,820 10,292,820 Transportation 1,761,702 19,370 1,781,072

Unrestricted (126,181,151) 14,535,250 (111,645,901) Total Net Position $ (13,849,675) $ 137,283,028 $ 123,433,353

The notes to the financial statements are an integral part of this statement.

CITY OF FORT MYERS, FLORIDAStatement of Net Position

September 30, 2015Primary Government

Governmental Business-typeActivities Activities Total

1717

Operating CapitalCharges for Grants and Grants and Governmental Business-type

Functions / Programs Expenses Services Contributions Contributions Activities Activities TotalPrimary government:

Governmental activities:General government 9,914,148$ 1,256,131$ -$ -$ (8,658,017)$ -$ (8,658,017)$ Police 35,863,633 1,063,539 343,469 - (34,456,625) - (34,456,625) Fire 19,496,788 2,507,883 1,128,543 157,115 (15,703,247) - (15,703,247) Protective inspections 1,546,049 1,663,511 - - 117,462 - 117,462 Physical environment 5,882,766 4,083,754 5,000 322,124 (1,471,888) - (1,471,888) Transportation 17,111,271 171,900 553,868 462,408 (15,923,095) - (15,923,095) Economic environment 4,184,294 433,298 876,477 - (2,874,519) - (2,874,519) Culture and recreation 3,635,056 936,170 950 275,650 (2,422,286) - (2,422,286) Interest on long-term debt 4,481,774 - - - (4,481,774) - (4,481,774)

Total governmental activities 102,115,779 12,116,186 2,908,307 1,217,297 (85,873,989) - (85,873,989)

Business-type Activities:Water-Wastewater 49,841,779 65,993,362 - 5,481,241 - 21,632,824 21,632,824 Solid Waste 9,642,121 14,739,561 - - - 5,097,440 5,097,440 Building Permits and Inspections 3,129,113 4,462,337 - - - 1,333,224 1,333,224 Stormwater 3,134,327 2,798,933 - 1,229,433 - 894,039 894,039 Fort Myers Country Club 2,563,311 1,757,788 - 258,212 - (547,311) (547,311) Eastwood Golf Course 1,862,452 1,849,209 - - - (13,243) (13,243) Yacht Basin 2,587,863 2,389,856 - - - (198,007) (198,007) Harborside Event Center 3,280,921 2,026,898 - - - (1,254,023) (1,254,023) Downtown Parking Garages 1,049,490 1,170,576 - - - 121,086 121,086 Skatium 1,250,814 999,622 - - - (251,192) (251,192) Dept of Cultural and Historic Affairs 1,628,842 535,185 1,646 - - (1,092,011) (1,092,011)

Total business-type activities 79,971,033 98,723,327 1,646 6,968,886 - 25,722,826 25,722,826

Total primary government 182,086,812$ 110,839,513$ 2,909,953$ 8,186,183$

General revenues:Taxes:

Property taxes 39,540,177 - 39,540,177 Public service taxes 11,128,791 - 11,128,791 Fuel taxes 4,757,761 - 4,757,761 Local business tax 1,866,306 - 1,866,306 Franchise taxes 5,587,985 - 5,587,985

Intergovernmental, unrestricted 8,707,856 - 8,707,856 Interest and investment income 231,581 166,314 397,895 Miscellaneous 1,334,794 148,851 1,483,645

Net transfers 9,048,150 (9,048,150) - Total general revenues and transfers 82,203,401 (8,732,985) 73,470,416

Change in net position (3,670,588) 16,989,841 13,319,253

Net position - beginning of year as previously reported 110,653,352 143,963,530 254,616,882 Adjustment (See Note 24) (120,832,439) (23,670,343) (144,502,782)

Net position - beginning of year as restated (10,179,087) 120,293,187 110,114,100 Net position - ending (13,849,675)$ 137,283,028$ 123,433,353$


Program RevenuesNet (Expense) Revenue and Changes in Net Position

Primary Government

CITY OF FORT MYERS, FLORIDAStatement of Activities

For the Year Ended September 30, 2015

19

General FundRevenue Bonds

and NotesTransportation Capital Projects

ASSETSCash and cash equivalents $ 11,383,275 $ 5,097,888 $ 30,800,899 Investments 5,162,772 157,962 13,690,400 Accounts receivable, net 2,803,195 - 200,000 Special assessments receivable 682,689 - - Interest receivable 12,454 1,787 88,715 Due from other funds 914,445 - - Due from other governmental agencies 1,342,119 - 400,265 Prepaid items 13,305 - - Deferred special assessments receivable 5,450 - - Notes receivable - - - Allowance for notes receivable - - - Advances to other funds 617,000 - - Assets held for resale - - -

Total assets $ 22,936,704 $ 5,257,637 $ 45,180,279

LIABILITIESAccounts and contracts payable $ 704,668 $ 1,550 $ 1,491,585 Accrued and other liabilities 4,864,072 15,000 - Due to other funds - - - Due to other governmental agencies 82,150 - 169,281 Funds held in escrow 222,981 - - Customer deposits 374,491 - - Unearned revenue - other 529,856 - - Advances from other funds - - -

Total liabilities 6,778,218 16,550 1,660,866

DEFERRED INFLOWS OF RESOURCESUnavailable revenue - code enforcement fees 577,940 - - Unavailable revenue - rental income 103,359 - - Unavailable revenue - special assessments 607,835 - - Unavailable revenue - grants, contributions - - 200,000

Total deferred inflows of resources 1,289,134 - 200,000

FUND BALANCES (DEFICITS)Nonspendable:

Advances to other funds 617,000 - - Prepaid items 13,305 - - Asset held for resale - - - Public safety principal, nonexpendable - - -

Restricted for:Donations received - - - CRA - - - Capital projects - - - Debt service - 5,241,087 - Economic environment - - - Law enforcement programs - - - Physical environment - - - Transportation - - 43,319,413

Committed to:Law enforcement programs - - -

Assigned to:Subsequent year's expenditures 1,544,078 - - Capital projects 402,614 - - Cemetery maintenance 591,699 - - Culture and recreation 46,870 - - Economic environment 117,591 - - Land acquisition 297,677 - - Law enforcement programs 97,690 - - Submerged land lease 76,451 - -

Unassigned 11,064,377 - - Total fund balances (deficits) 14,869,352 5,241,087 43,319,413

Total liabilities, deferred inflows of resources, and fund balances (deficits) $ 22,936,704 $ 5,257,637 $ 45,180,279

The notes to financial statements are an integral part of this statement.

CITY OF FORT MYERS, FLORIDABalance Sheet

Governmental Funds September 30, 2015

20

General Capital Projects

Total Nonmajor Funds

Total Governmental

Funds

$ 6,393,094 $ 4,604,143 $ 58,279,299 7,073,995 2,071,281 28,156,410 - 89,540 3,092,735 - - 682,689 22,620 12,095 137,671 - - 914,445 - 672,379 2,414,763 - 1,125 14,430 - - 5,450 - 6,155,326 6,155,326 - (6,155,326) (6,155,326) - - 617,000 - 519,010 519,010 $ 13,489,709 $ 7,969,573 $ 94,833,902

$ 1,304,605 $ 331,544 $ 3,833,952 7,372 8,981 4,895,425 - 134,384 134,384 - 261,027 512,458 - 408 223,389 - - 374,491 - 231,423 761,279 - 617,000 617,000 1,311,977 1,584,767 11,352,378

- - 577,940 - - 103,359 - - 607,835 - 123,605 323,605 - 123,605 1,612,739

- - 617,000 - 1,125 14,430 - 258,010 258,010 - 2,000 2,000

- 1,684,834 1,684,834 - 2,062,907 2,062,907 12,175,371 - 12,175,371 - - 5,241,087 - 618,899 618,899 - 285,017 285,017 - 202,100 202,100 - 1,097,117 44,416,530

- 66,838 66,838

- - 1,544,078 2,361 - 404,975 - - 591,699 - - 46,870 - - 117,591 - - 297,677 - - 97,690 - - 76,451 - (17,646) 11,046,731 12,177,732 6,261,201 81,868,785

$ 13,489,709 $ 7,969,573 $ 94,833,902

21

Total fund balances - governmental funds 81,868,785$

Capital assets used in governmental activities are not financial resources and, therefore,are not reported in the funds. 146,819,646

Some revenues have been unearned on the balance sheet because they were notmeasurable and available at year end. 1,612,739

Long-term liabilities, including revenue bonds payable, are not due and payable in thecurrent period, and, therefore, are not reported in the funds. (251,096,869)

Internal service funds are used by management to charge the costs of certain activities toindividual funds. The assets and liabilities of the internal service funds are included ingovernmental activities in the statement of net position. 6,946,024

Net position of governmental activities (13,849,675)$


Amounts reported for governmental activities in the statement of net position are differentbecause:

CITY OF FORT MYERS, FLORIDAReconciliation of the Balance Sheet of Governmental Funds

to the Statement of Net PositionSeptember 30, 2015

23

General FundRevenue Bonds

and NotesTransportation Capital Projects

REVENUESTaxes $ 58,571,143 $ - $ 1,986,551 Permits and fees 4,050,470 - 192,776 Intergovernmental revenue 7,355,221 - 100,358 Charges for services 6,666,238 - - Fines and forfeitures 518,404 - - Miscellaneous 1,260,119 235 133,918 Contributions - private source 29,970 - 25,362

Total revenues 78,451,565 235 2,438,965


General government 10,417,815 - - Police 37,483,470 - - Fire 19,389,454 - - Protective inspections 1,625,700 - - Physical environment 5,968,175 - - Transportation 450,450 - 607,466 Economic environment 353,251 - - Culture and recreation 2,846,246 - -

Debt service:Principal - 6,813,035 - Interest - 4,022,422 - Fiscal charges - 11,223 -

Capital outlay:General government - - - Fire - - - Physical environment - - - Transportation - - 5,855,921 Culture and recreation - - -

Total expenditures 78,534,561 10,846,680 6,463,387 Excess (deficiency) of revenues over expenditures (82,996) (10,846,445) (4,024,422)

OTHER FINANCING SOURCES (USES)Transfers in 13,025,600 10,466,570 1,833,166 Transfers out (13,716,718) - (1,675,800)

Total other financing source (uses) (691,118) 10,466,570 157,366

Net change in fund balances (774,114) (379,875) (3,867,056)

Fund balances - beginning 15,643,466 5,620,962 47,186,469 Fund balances - ending $ 14,869,352 $ 5,241,087 $ 43,319,413


CITY OF FORT MYERS, FLORIDAStatement of Revenues, Expenditures and Changes in Fund Balances

Governmental FundsFor the Year Ended September 30, 2015

24

General Capital Projects


Total Governmental

Funds

$ - $ 3,727,424 $ 64,285,118 351,539 - 4,594,785 215,556 2,779,681 10,450,816 - - 6,666,238 - 119,635 638,039 17,576 634,205 2,046,053 - 72,631 127,963 584,671 7,333,576 88,809,012

- - 10,417,815 - 535,751 38,019,221 - 1,104,648 20,494,102 - - 1,625,700 - - 5,968,175 - 3,625,410 4,683,326 - 3,523,515 3,876,766 - 6,156 2,852,402

- 521,154 7,334,189 - 162,999 4,185,421 - - 11,223

1,396,168 - 1,396,168 1,416,924 - 1,416,924 51,477 - 51,477 128,501 - 5,984,422 646,962 - 646,962 3,640,032 9,479,633 108,964,293

(3,055,361) (2,146,057) (20,155,281)

412,656 2,348,132 28,086,124 (2,112,276) (215,460) (17,720,254) (1,699,620) 2,132,672 10,365,870

(4,754,981) (13,385) (9,789,411)

16,932,713 6,274,586 91,658,196 $ 12,177,732 $ 6,261,201 $ 81,868,785

25

Net change in fund balances - total governmental funds (9,789,411)$

Governmental funds report capital outlays as expenditures. However, in the statement ofactivities, the cost of those assets is allocated over their estimated useful lives asdepreciationexpense. This is the amount by which depreciationexpenseexceededcapitaloutlay in the current period. (897,117)

Donations of capital assets increase net position in the statement of activities, but do notappear in the governmental funds because they are not financial resources. 122,390

Revenues in the statement of activities that do not provide current financial resources arenot reported as revenues in the funds. 484,188

The issuance of long-term debt (e.g., bonds, leases) provides current financial resourcesto governmental funds, while the repayment of the principal of long-term debt consumesthe current financial resources of governmental funds. Neither transaction, however, hasany effect on net position. Also, governmental funds report the effect of issuance costs,premiums, discounts, and similar items when debt is first issued, whereas these amountsare deferred and amortized in the statement of activities. This amount is the net effect ofthese differences in the treatment of long-term debt and related items. 1,300,439

Some expenses reported in the statement of activities do not require the use of currentfinancial resources and, therefore, are not reported as expenditures in the governmentalfunds. 3,475,635

Internal service funds are used by management to charge the costs of informationtechnology, fleet management, risk management,and warehousing to individual funds andcustomers. Losses arising from the internal customers are added as expenditureson thestatement of activities as chargebacks. Revenues and expenditures with outsidecustomers are included also, as are nonoperatingrevenues and expenses. This amount isthe effect of reporting internal service funds with governmental activities. 1,633,288

Change in net position of governmental activities (3,670,588)$


Amounts reported for governmental activities in the statement of activities are differentbecause:

CITY OF FORT MYERS, FLORIDAReconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances

of Governmental Funds to the Statement of ActivitiesFor the Year Ended September 30, 2015

26


Water-Wastewater Solid Waste


Total Enterprise Funds


ASSETSCurrent assets:

Cash and cash equivalents $ 12,537,505 $ 2,703,742 $ 7,734,262 $ 22,975,509 $ 8,670,554 Investments 5,545,411 1,200,805 3,661,509 10,407,725 4,179,230 Restricted cash and cash equivalents 36,144,177 313,022 475,121 36,932,320 3,455,479 Restricted investments 13,531,773 125,117 320,633 13,977,523 - Accounts receivable, net 6,750,863 1,065,923 305,563 8,122,349 1,662 Interest receivable 26,452 8,403 12,383 47,238 17,747 Restricted interest receivable 14,706 451 923 16,080 - Due from other governmental agencies 4,464,191 9,475 2,278,850 6,752,516 383 Inventories 331,020 - 131,755 462,775 635,861 Prepaid items - - 491,438 491,438 272,385

Total current assets 79,346,098 5,426,938 15,412,437 100,185,473 17,233,301 Noncurrent assets:

Unamortized bond insurance costs 200,990 - - 200,990 - Intangible assets, net 208,699 - 72,571 281,270 13,406 Land and improvements 954,695 - 2,833,448 3,788,143 - Construction in progress 2,480,258 - 2,674,234 5,154,492 - Buildings, net 23,470,332 307,564 7,577,707 31,355,603 4,267 Improvements other than buildings, net 269,895,800 - 20,754,695 290,650,495 - Equipment, net 3,033,392 6,000,105 1,475,687 10,509,184 891,958

Total noncurrent assets 300,244,166 6,307,669 35,388,342 341,940,177 909,631 Total assets 379,590,264 11,734,607 50,800,779 442,125,650 18,142,932

DEFERRED OUTFLOWS OF RESOURCESDeferred charge on refunding 393,956 5,451 5,544 404,951 - Deferred outflows on pension earnings 1,135,840 386,654 841,141 2,363,635 439,741

Total deferred outflows of resources 1,529,796 392,105 846,685 2,768,586 439,741

LIABILITIESCurrent liabilities:

Accounts and contracts payable 4,255,426 1,034,175 1,925,802 7,215,403 655,435 Accrued and other liabilities 99,896 6,491 60,404 166,791 112,309 Due to other funds - - 780,061 780,061 - Due to other governmental agencies 98,705 - 62,702 161,407 - Customer deposits 7,060,689 - 150,597 7,211,286 - Compensated absences 89,812 20,241 137,010 247,063 23,221 Claims and judgments - - - - 3,166,600 Accrued interest payable 4,494,358 4,837 18,606 4,517,801 - Capital lease payable - - 115,604 115,604 78,200 Loans and notes payable 5,323,319 - 214,219 5,537,538 - Revenue bonds payable 5,980,000 33,258 31,812 6,045,070 -

Total current liabilities 27,402,205 1,099,002 3,496,817 31,998,024 4,035,765 Noncurrent liabilities:

Net pension liability 12,175,861 4,144,816 9,016,771 25,337,448 4,713,903 Compensated absences 293,839 95,860 224,732 614,431 102,290 Other postemployment benefits payable 1,528,071 494,953 1,178,764 3,201,788 497,284 Claims and judgments - - - - 2,250,488 Due to private sources 2,832,963 - - 2,832,963 - Capital lease payable - - 393,456 393,456 - Loans and notes payable 111,584,800 - 3,533,824 115,118,624 - Revenue bonds payable 125,180,025 272,859 260,996 125,713,880 -

Total noncurrent liabilities 253,595,559 5,008,488 14,608,543 273,212,590 7,563,965 Total liabilities 280,997,764 6,107,490 18,105,360 305,210,614 11,599,730

DEFERRED INFLOWS OF RESOURCESDeferred charge on refunding 2,202,149 - - 2,202,149 - Deferred inflows related to pensions 95,362 32,462 70,621 198,445 36,919

Total deferred inflows of resources 2,297,511 32,462 70,621 2,400,594 36,919

NET POSITIONNet investment in capital assets 46,492,386 5,931,265 29,535,685 81,959,336 831,431 Restricted for:

Capital projects 11,830,211 83,384 1,885,143 13,798,738 - Culture and recreation - - 2,147 2,147 - Debt service 10,072,830 26,895 25,647 10,125,372 - Impact fee projects 6,549,995 - - 6,549,995 - Renewal and replacement 9,808,266 323,474 161,080 10,292,820 - Transportation - - 19,370 19,370 -

Unrestricted 13,071,097 (378,258) 1,842,411 14,535,250 6,114,593 Total net position $ 97,824,785 $ 5,986,760 $ 33,471,483 137,283,028 $ 6,946,024



Proprietary Funds September 30, 2015

Business-type Activities

27



Total Nonmajor

FundsTotal Enterprise

FundsInternal Service

FundsOPERATING REVENUES

Charges for services $ 61,088,963 $ 14,696,220 $ 15,731,862 $ 91,517,045 $ 17,137,305 Rent - - 2,159,074 2,159,074 - Miscellaneous 4,904,399 43,341 148,621 5,096,361 428,689

Total operating revenues 65,993,362 14,739,561 18,039,557 98,772,480 17,565,994

OPERATING EXPENSESPersonnel services 8,976,191 3,172,447 6,945,435 19,094,073 3,170,843 Materials and supplies 3,819,638 424,369 2,824,203 7,068,210 3,119,502 Contractual services 2,169,456 2,286,301 3,822,237 8,277,994 726,828 General and administrative 3,683,266 604,646 1,094,577 5,382,489 679,590 Utilities 2,446,399 27,221 1,001,149 3,474,769 607,065 Repairs and maintenance 2,807,298 132,406 426,555 3,366,259 1,130,545 Rentals 1,192,793 1,844,788 1,089,281 4,126,862 383,566 Travel 8,995 1,506 12,380 22,881 19,457 Insurance 723,800 461,500 615,400 1,800,700 1,181,210 Self insurance claims - - - - 3,203,903 Depreciation 14,436,527 673,676 2,281,153 17,391,356 403,303

Total operating expenses 40,264,363 9,628,860 20,112,370 70,005,593 14,625,812

Operating income (loss) 25,728,999 5,110,701 (2,072,813) 28,766,887 2,940,182

NONOPERATING REVENUES (EXPENSES)Operating grants and contributions - - 1,646 1,646 - Interest income 106,147 23,030 37,137 166,314 19,732 Gain (loss) on disposal of capital assets 6,600 87,500 5,597 99,697 (7,366)Interest expense and bond insurance costs (9,577,416) (13,262) (374,761) (9,965,439) (1,540)

Total nonoperating revenues (expenses) (9,464,669) 97,268 (330,381) (9,697,782) 10,826 Income (loss) before contributions and transfers 16,264,330 5,207,969 (2,403,194) 19,069,105 2,951,008

Capital grants and contributions 5,481,241 - 1,487,645 6,968,886 - Transfers in - - 3,230,749 3,230,749 - Transfers out (6,588,300) (4,754,200) (936,399) (12,278,899) (1,317,720)

Change in net position 15,157,271 453,769 1,378,801 16,989,841 1,633,288

Net position - beginning (1) 82,667,514 5,532,991 32,092,682 120,293,187 5,312,736 Net position - ending $ 97,824,785 $ 5,986,760 $ 33,471,483 $ 137,283,028 $ 6,946,024

(1) Restated, as noted in Note 24


CITY OF FORT MYERS, FLORIDAStatement of Revenues, Expenses, and Changes in Net Position

Proprietary FundsFor the Year Ended September 30, 2015


28



Total Nonmajor

Enterprises

Total Enterprise

Funds


CASH FLOWS FROM OPERATING ACTIVITIESReceipts from customers $ 61,212,028 $ 14,652,980 $ 16,478,365 $ 92,343,373 $ 17,137,153 Other operating receipts 4,904,399 43,341 148,621 5,096,361 428,689 Payments to suppliers and service providers (13,787,971) (5,098,603) (10,440,818) (29,327,392) (8,446,525)Payments to employees for services (8,885,952) (3,171,484) (6,872,072) (18,929,508) (5,163,313)Other operating payments (685,012) (175,671) (102,657) (963,340) -

Net cash provided by (used for) operating activities 42,757,492 6,250,563 (788,561) 48,219,494 3,956,004

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIESTransfers in - - 3,230,749 3,230,749 - Transfers out (6,588,300) (4,754,200) (936,399) (12,278,899) (1,317,720)Operating grants and contributions - - 1,646 1,646 - Payments on interfund loans - - 780,061 780,061 -

Net cash provided by (used for) noncapital financing activities (6,588,300) (4,754,200) 3,076,057 (8,266,443) (1,317,720)

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES

Capital grants and contributions 25,451 - 1,399,596 1,425,047 - Acquisition and construction of capital assets (10,322,888) (4,532,699) (5,573,634) (20,429,221) (337,424)Principal paid on notes and bonds (11,040,951) (31,671) (235,210) (11,307,832) - Interest paid on notes and bonds (9,579,026) (15,303) (363,898) (9,958,227) - Principal paid on capital lease - - - - (116,321)Interest paid on capital lease - - - - (1,540)Proceeds from sale of capital assets 6,600 87,500 6,890 100,990 7,017

Net cash (used for) capital and related financing activities (30,910,814) (4,492,173) (4,766,256) (40,169,243) (448,268)

CASH FLOWS FROM INVESTING ACTIVITIESPurchase of investments (2,509,230) - (612,911) (3,122,141) (897,138)Proceeds from sale of investments 1,129,702 785,980 849,017 2,764,699 - Interest on investments 42,794 4,332 6,198 53,324 5,540

Net cash provided by (used for) investing activities (1,336,734) 790,312 242,304 (304,118) (891,598)Net increase in cash and cash equivalents 3,921,644 (2,205,498) (2,236,456) (520,310) 1,298,418

Balances - beginning of year 44,760,038 5,222,262 10,445,839 60,428,139 10,827,615 Balances - end of year $ 48,681,682 $ 3,016,764 $ 8,209,383 $ 59,907,829 $ 12,126,033

Reconciliation of operating income (loss) to net cash provided by operating activities:Operating income (loss) $ 25,728,999 $ 5,110,701 $ (2,072,813) $ 28,766,887 $ 2,940,182 Adjustments to reconcile operating income (loss) to net cash provided by operating activities:

Depreciation 14,436,527 673,676 2,281,153 17,391,356 403,303 Pension expense (101,025) (34,390) (74,814) (210,229) (39,112)Changes in assets and liabilities:

(Increase) in accounts receivable (799,880) (200,045) (1,351,683) (2,351,608) (152)(Increase) decrease in bad debt 922,945 156,805 (71,765) 1,007,985 - (Increase) decrease in inventories (33,307) - (391,342) (424,649) 24,218 (Increase) decrease in prepaid items 4,315 - 45,727 50,042 (122,925)(Decrease) increase in customer deposits payable 373,241 - (13,147) 360,094 - Increase in accounts payable - supplier 2,052,324 508,462 699,327 3,260,113 683,053 (Decrease) increase in accounts payable - other (17,910) - 12,616 (5,294) - (Decrease) increase in compensated absences 10,048 (23,698) 2,411 (11,239) 2,145 Increase in other postemployement benefits 181,215 59,052 145,769 386,036 65,292

Net cash provided by (used for) operating activities $ 42,757,492 $ 6,250,563 $ (788,561) $ 48,219,494 $ 3,956,004

Schedule of non-cash investing, capital, and financing activities:Interest receivable / unrealized gain (loss) 63,353$ 18,698$ 30,939$ 112,990$ 14,192$

Donation of utility improvements 5,455,790 - 88,049 5,543,839 -


CITY OF FORT MYERS, FLORIDAStatement of Cash Flows

For the Year Ended September 30, 2015Proprietary Funds


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ASSETSCash and cash equivalents $ 9,923,570 $ 169,491

ReceivablesEmployer contributions 14,100,443 - Interest and dividends 428,899 52 Prepaid items - benefits 1,081,324 -

Total receivables 15,610,666 52

Investments, at fair valueU.S. government and agency securities 14,630,561 - Municipal bonds 908,526 - Corporate stock 90,897,070 - Corporate stocks - ADR 888,884 - Corporate bonds 12,642,697 - Convertible bonds 6,598,317 - Convertible preferred 2,072,260 - Mortgage backed securities 12,999,645 - Asset backed securities 4,784,944 - Mutual funds:

Fixed income 9,524,497 - Equity 15,911,308 - International equity 18,243,494 -

Commingled funds - Real estate 9,295,805 - Limited partnerships:

Real estate 8,829,697 - International equity 11,091,155 -

Master limited partnerships 1,880,512 - Private placements 90,748 - Real estate investment trusts 10,569,936 - International securities:

Bonds and notes 513,620 - Stocks 3,583,193 - Total investments 235,956,869 -

Total assets 261,491,105 $ 169,543

LIABILITIES Payables

Accounts and contracts payable - $ 59,059 Accrued and other liabilities - 22,484 Benefit payments 4,220 - Investment expenses 302,137 - Administrative expenses 18,673 - Due to other governmental agencies - 88,000

Total liabilities 325,030 $ 169,543

NET POSITIONNet position restricted for pensions $ 261,166,075


FundsPension Trust Agency

Funds


Fiduciary FundsSeptember 30, 2015

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ADDITIONSContributions

Employer $ 21,344,946 State of Florida 1,483,769 Plan members 2,767,780

Total contributions 25,596,495

Investment incomeNet depreciation in fair value

of investments (5,139,770) Interest and dividends 5,560,750

Total investment gains 420,980

Less: investment expenses 1,456,338 Net investment losses (1,035,358)

Total additions 24,561,137

DEDUCTIONSBenefits paid 20,695,878 Administrative expenses 292,605

Total deductions 20,988,483

Change in net position 3,572,654

NET POSITIONNet position - beginning 257,593,421 Net position - ending $ 261,166,075


Pension TrustFunds

CITY OF FORT MYERS, FLORIDAStatement of Changes in Net Position

Fiduciary FundsFor the Year Ended September 30, 2015

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CITY OF FORT MYERS, FLORIDA Notes to the Financial Statements

September 30, 2015

Note 1. Summary of Significant Accounting Policies ......................................................................... 34

Note 2. Reconciliation of Government-wide and Fund Financial Statements.................................... 44

Note 3. Stewardship, Compliance and Accountability ....................................................................... 46

Note 4. Cash Deposits and Investments ............................................................................................ 46

Note 5. Restricted Assets ................................................................................................................... 58

Note 6. Receivables ........................................................................................................................... 59

Note 7. Assets Held for Resale .......................................................................................................... 60

Note 8. Capital Assets ........................................................................................................................ 61

Note 9. Accrued Liabilities and Unearned Revenue .......................................................................... 63

Note 10. Pension Obligations ............................................................................................................... 64

Note 11. Deferred Compensation Plan ................................................................................................ 79

Note 12. Other Postemployment Benefit Obligations .......................................................................... 80

Note 13. Commitments......................................................................................................................... 81

Note 14. Risk Management .................................................................................................................. 83

Note 15. Long-Term Liabilities ............................................................................................................. 84

Note 16. Prior Year Defeased Debt ..................................................................................................... 90

Note 17. Fund Balance ........................................................................................................................ 90

Note 18. Interfund Receivables and Payables ..................................................................................... 91

Note 19. Interfund Transfers ................................................................................................................ 92

Note 20. Redevelopment Trust Fund ................................................................................................... 93

Note 21. Related Organization Transactions ....................................................................................... 93

Note 22. Construction Project Interest Costs ....................................................................................... 94

Note 23. Contingencies ........................................................................................................................ 94

Note 24. Prior Period Adjustments ....................................................................................................... 94

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CITY OF FORT MYERS, FLORIDA Notes to the Financial Statements, continued

September 30, 2015 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. Description of government-wide financial statements The government-wide financial statements (the Statement of Net Position and the Statement of Activities) report information on all of the non-fiduciary activities of the primary government and component units. The City’s fiduciary funds are presented in the fund financial statements by type (pension and agency). Since, by definition, these assets are being held for the benefit of a third party (i.e. pension participants) and cannot be used to address activities or obligations of the government, these funds are not incorporated into the government-wide statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. 2. Reporting Entity The City of Fort Myers, (City) was incorporated in 1886 pursuant to the laws of Florida 3959, and Chapter 165, Florida Statutes. The City operates under a City Council-Manager form of government and consists of six wards, each represented by a council member, and a seventh voting seat, the Mayor elected-at-large. The accompanying financial statements present the City and its component units. Component units are legally separate organizations for which the City, as the primary government, is financially accountable. Financial accountability is defined as the appointment of a voting majority of the component unit’s board, and either (a) the ability to impose will by the primary government, or (b) the potential that the component unit will provide specific financial benefits to, or impose specific financial burdens on, the primary government. As a result, the primary government and its component units combine to form a single financial reporting entity for financial statement purposes. In evaluating the City as a reporting entity, management considered all potential component units in accordance with Governmental Accounting Standards Board (GASB) Statement No. 14, “Defining the Financial Reporting Entity”; GASB Statement No. 39, “Determining Whether Certain Organizations are Component Units – an amendment of GASB Statement No. 14”; and, GASB Statement No. 61, “The Financial Reporting Entity: Omnibus – an amendment of GASB Statements No. 14 and No. 34”. GASB Statement No. 61 further requires that a financial benefit or burden relationship be present, regardless of the election or appointment of the component unit’s governing board. Management reviewed all of the financial accountability concepts and determined the existing blended component units met the criterion for blending. They are included in the City’s reporting entity and are reported as part of the primary government. Blended Component Units: The Community Redevelopment Agency of Fort Myers (CRA) was established November 5, 1984 by the City of Fort Myers under Ordinance 2259 pursuant to Chapter 163, Part III of the Florida Statutes. The mission of the CRA is to redevelop and revitalize the historic downtown as well as the older commercial corridors and residential neighborhoods of the City. The six City Council Members and the Mayor are the governing board of the CRA, sitting as the Board of Governors, which elects a chairperson and vice-chairperson. The CRA is fiscally dependent on the City because it is unable to issue bonded debt without approval by the primary government. The majority of the revenue sources result from tax increment financing, which is a commitment of the City’s taxing power. The CRA includes the Downtown Redevelopment Area, the Velasco Village Redevelopment Area, the Central Fort Myers Redevelopment Area, the Eastwood Village Redevelopment Area, the Dunbar-Michigan Redevelopment Area, the East Fort Myers Redevelopment Area, the Cleveland Avenue Redevelopment Areas and the Martin Luther King Redevelopment Areas. The CRA is presented as a non-major special revenue fund and its financial statements are included in the City’s Comprehensive Annual Financial Report for the year ended September 30, 2015 in the Combining Statements and Schedules section. Separate financial statements for the CRA are not available. Other Related Organizations: The City of Fort Myers Housing Authority is a separate legal entity. Authority commissioners are appointed by the Mayor and approved by the City Council and may be removed for cause. There is no financial benefit or burden to the City and the City has no authority over day-to-day operations. As such, this organization is not included in the accompanying financial statements.

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September 30, 2015 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

3. Basis of presentation – government-wide financial statements While separate government-wide and fund financial statements are presented, they are interrelated. The governmental activities column incorporates data from governmental funds and internal service funds, while business-type activities incorporate data from the City’s enterprise funds. Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds. Fiduciary funds and component units that are fiduciary in nature (i.e. Pension Trust Funds) are excluded from the government-wide financial statements. Generally, interfund activity has been eliminated from the government-wide financial statements. Notable exceptions are other charges of the City’s water and wastewater function. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. 4. Basis of presentation – fund financial statements The fund financial statements provide information about the City’s funds, including its fiduciary funds and blended component units. Separate statements for each category – governmental, proprietary, and fiduciary – are presented. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are aggregated and reported as non-major funds. Major individual governmental and enterprise funds are reported as separate columns in the fund financial statements. The City reports the following major governmental funds:

The General Fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those that are required to be accounted for in another fund. Revenue is derived primarily from property taxes, state and federal distributions, grants and other intergovernmental revenue. The general operating expenditures, fixed charges and capital outlay costs that are not paid through other funds are paid from the General Fund. The Revenue Bonds and Notes Fund accounts for the accumulation of resources to pay outstanding long term debt. It is made up of several sub-funds, one for each bond or other borrowing that is outstanding and for which resources are accumulated to pay the debt service. The Transportation Capital Projects Fund accounts for resources accumulated to provide transportation related capital projects. It includes road impact fees, cash from debt borrowing, the accounting for capital projects and the 5th cent local option gas tax money.

The General Capital Projects Fund is used to account for the financial resources to be used for the acquisition and construction of the City’s general capital facilities, improvements and equipment.

The City reports the following major enterprise funds:

The Water-Wastewater Utility Fund accounts for the activities related to providing water, wastewater and reclaimed water services to the public. The Solid Waste Fund accounts for the revenues and costs associated with providing solid waste services to the residents of the City.

In addition, the City reports the following other fund types:

Internal Service Funds account for services provided to other departments of the City on a cost reimbursement basis. These services include: Information Technology Services, Risk Management Services (workers’ compensation, general liability insurance and property insurance), Central Garage and a Public Works Warehouse that acts as a central store for items needed for all phases of Public Works.

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4. Basis of presentation – fund financial statements (continued)

The Pension Trust Funds account for activities of the City’s General Employee’s Pension Plan, Police Officers’ Retirement System and the Firefighters’ Retirement System (collectively, the Pension Trust Funds). The Pension Trust Funds are separate legal entities, which accumulate resources for the pension benefit payments to virtually all full-time, regular employees, all non-civilian police department employees, and all firefighters and fire department officers, respectively. The Agency Funds are used to account for resources collected by the City for third parties. These agency funds include the Regional Park Impact Fee Fund, the Emergency Medical Services (EMS) Impact Fee Fund, School Board Impact Fee Fund, Unclaimed Funds and the Employees’ Special Events Fund. The Regional Park, EMS and School Impact Fee Funds are impact fees levied by the County. The City collects these impact fees at the time permits are issued and then turns the fees over to the County. The Unclaimed Funds fund accounts for funds that the City has been holding, and if not claimed, will eventually go to the State of Florida. The Employee Special Events Fund is money being held for the group that does special events for the City’s employees. This group raises their own funds and the City provides the tracking and accounting of these funds for the Committee.

During the course of its operations, the City has numerous transactions between funds to provide services, construct assets and service debt. To the extent that certain transactions between funds were not paid or received as of September 30, 2015, balances of interfund receivables and payables expected to be liquidated within one year have been recorded as due from and due to other funds. Balances of interfund receivables and payables not expected to be liquidated within one year are recorded as advances to and advances from other funds. While these balances are reported in the fund financial statements, certain eliminations are made in the preparation of the government-wide financial statements. Balances between the funds included in governmental activities (the governmental and internal service funds) are eliminated so that only the net amount is included as internal balances in the governmental activities column. Similarly, balances between the funds included in business-type activities (the enterprise funds) are eliminated so that only the net amount is included as internal balances in the business-type activities column. Further, certain activity occurs during the year involving transfers of resources between funds. In fund financial statements, these amounts are reported at gross amounts as transfers in/out. While reported in fund financial statements, certain eliminations are made in the preparation of the government-wide financial statements. Transfers between funds included in governmental activities are eliminated so that only the net amount is included as transfers in the governmental activities column. Similarly, balances between the funds included in business-type activities are eliminated so that only the net amount is included as transfers in the business-type activities column. 5. Measurement focus, basis of accounting and financial statement presentation The accounting and financial reporting treatment is determined by the applicable measurement focus and basis of accounting. Measurement focus indicates the type of resources being measured such as current financial resources or economic resources. The basis of accounting indicates the timing of transactions or events for recognition in the financial statements. Government-wide financial statements. The government-wide 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 related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements have been met. Governmental fund financial statements. The governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within 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 generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and

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5. Measurement focus, basis of accounting and financial statement presentation (continued) judgments, are recorded only when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. Issuance of long-term debt is reported as other financing sources. Property taxes, public service taxes, franchise taxes, fuel taxes, and interest associated with the current fiscal period are all considered to be susceptible to accrual. These have been recognized as revenues of the current fiscal period when they also meet the availability criteria (within 60 days of year end). Revenues from Federal and State reimbursement type grants are recognized when the qualifying expenditures have been incurred and all eligibility requirements have been met, and the amount is received during the period or within the availability period for this revenue source (within 60 days of year end). For special assessments, only the portion of the receivable due within the current period is considered to be susceptible to accruals as revenue of the current period. All other revenue items are considered to be measurable and available only when the City receives the cash. Proprietary, fiduciary and agency funds. The proprietary and fiduciary funds are reported using the economic resources measurement focus and the accrual basis of accounting. The agency funds are balance sheet funds only, and therefore have no measurement focus but use the accrual basis of accounting for reporting the assets and liabilities of the agency funds. 6. Budgetary information Budgetary basis of accounting Annual budgets are legally adopted for the General Fund, Debt Service Funds, Enterprise Funds, Internal Service Funds, Trust and Agency Funds and certain Special Revenue Funds. In addition, project budgets are adopted for the Capital Project Funds for the respective year along with approval of the five-year Capital Improvement Program. The City prepares its budget on a basis consistent with generally accepted accounting principles, with a few exceptions. For budget purposes, depreciation is not shown in the annual budgets and debt service is reported as current year expenditures. The appropriated budget is prepared by fund, department, and division. The City Manager, the Director of Finance and the Budget Manager have the authority to approve the transfer of funds within a department, within a fund. Transfers that are greater than $50,000 are presented to Council on a quarterly basis following their implementation. Transfers that are less than $50,000 are not presented to Council unless the cumulative total reaches $50,000 in any department and are then reported on a quarterly basis as well. In most cases, divisions are required to transfer funds only to meet unanticipated needs or to reflect organizational changes. The legal level of budgetary control (i.e., the level at which expenditures may not legally exceed appropriations) is the department level within a fund, except for the Community Redevelopment Agency, which uses the fund level as their budgetary control. Whereas the adopted budget is meant to control and provide for the efficient and economical running of the City, amendments (increases or decreases in appropriations and/or revenue estimates) to a budget may be required during the year to properly account for unanticipated needs or opportunities. Budget amendments in the amount of $50,000 or less (excluding use of reserves and changes to capital projects) require the approval of the City Manager and the Director of Finance, or their designees. All such amendments are provided to City Council on a quarterly basis following their implementation. All amendments to appropriations greater than $50,000, any adjustments to reserves, and/or adjustments to capital projects require City Council approval prior to implementation into the adopted budget. Appropriations in all budgeted funds lapse at the end of the fiscal year even if they have related encumbrances. Encumbrances are commitments related to unperformed contracts for goods or services, such as purchase orders, contracts, and commitments. Encumbrance accounting is used to the extent necessary to assure effective budgetary control and accountability and to facilitate effective cash planning and control. All encumbrances lapse at fiscal year end and valid encumbrances are re-appropriated and become part of the subsequent year’s budget.

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6. Budgetary information (continued) Excess of expenditures over appropriations For the year ended September 30, 2015, expenditures did not exceed appropriations with the exception of the Police Department due to higher than expected expenditures in overtime, which resulted in a variance of $(27,907), and the FEMA Disaster Grant due to the addition of repairs to the Fort Myers Country Club, $(6,156). 7. Assets, liabilities, deferred outflows/inflows of resources, and net position/fund balance

a. Cash and cash equivalents The City considers all highly liquid investments with original maturities of three months or less when purchased, as well as investments in the City’s cash and investment pool, to be cash equivalents.

b. Investments Investments for the City are reported at fair value and include obligations of the U.S. Treasury, Government Sponsored Enterprise Securities, corporate bonds, asset backed securities, mortgage backed securities and collateralized mortgage obligations. Money market investments with a remaining maturity at the time of purchase of one year or less are reported at amortized cost. The difference between cost and fair value of investments held is recorded as net unrealized gains or losses and is included in net investment earnings. Purchases and sales of investments are recorded on the trade dates. Net realized gains and losses on sale of investments are reflected in current operating results as investment earnings along with interest and dividends. The City invests surplus funds in an external investment pool, a Local Government Surplus Funds Trust Fund known as “Florida PRIME”. The Local Government Surplus Funds Trust Fund was created by an Act of the Florida Legislature effective October 1, 1977 (Chapter 218, Part IV, of the Florida Statutes). The State Board of Administration (“SBA”) is charged with the powers and duties to administer and invest Florida PRIME, in accordance with the statutory fiduciary standards of care as contained in Section 215.47(9), Florida Statutes. The SBA has contracted with Federated Investment Counseling (the “Investment Manager”) to provide investment advisory services for Florida PRIME. As a Florida PRIME participant, the City invests in a pool of investments whereby the City owns a share of the respective pool, not the underlying securities. The Florida “PRIME” is considered an SEC “2a-7 like” pool, an external investment pool that is not registered with the Securities and Exchange Commission (“SEC”) as an investment company, but nevertheless has a policy that it will, and does, operate in a manner consistent with Rule 2a-7 under the Investment Company Act of 1940. Rule 2a-7 is the rule that permits money market funds to use amortized cost to maintain a constant Net Asset Value (NAV) of $1.00 per share (which approximates fair value), provided that such funds meet certain conditions. Thus, the City’s account balance should also be considered the fair value of its investment.

c. Receivables

All trade, property tax and other receivables on the Statement of Net Position are shown net of allowance for uncollectible amounts. All receivables are reviewed periodically and, when determined to be uncollectible, are turned over to a collection agency. Once turned over to the collection agency, the amount is included in the uncollectible balance.

d. Inventories

Inventories for all funds, except for the enterprise funds, consist primarily of expendable supplies held for consumption and are stated at cost (first-in, first-out method). For the enterprise funds, the City uses the consumption method of accounting, which provides that expenditures are recognized when inventory is

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7. Assets, liabilities, deferred outflows/inflows of resources, and net position/fund balance (continued)

d. Inventories (continued)

used. Inventory in the Yacht Basin Enterprise Fund, Skatium Enterprise Fund and the Department of Cultural and Historic Affairs Enterprise Fund, which includes the Historical Museum and the Imaginarium Science Center, is held primarily for resale and stated at cost. The Department of Cultural and Historic Affairs and the Skatium value inventory at replacement cost. The Yacht Basin values oil and gift shop inventory by the retail method and fuel inventory by the cost inventory method. Both the retail and cost inventory methods use the last-in, first-out method. All inventories, regardless of fund, are counted on a periodic basis.

e. Prepaid items

Prepaid items are items that have been paid in the current accounting period but are proper expenses/expenditures extending over more than one accounting period and are allocated between those accounting periods that receive the benefit of the expense/expenditure.

f. Restricted assets

Proceeds of the City’s enterprise fund revenue bonds, as well as other resources set aside in accordance with bond covenants and local ordinance, are classified as restricted on the fund level Statement of Net Position of the enterprise funds. These include the following: operating accounts for the Water-Wastewater enterprise fund that are used for the accumulation of resources equal to operating costs for specified periods; renewal and replacement accounts used for the accumulation of resources to provide for replacement of existing system assets; debt service accounts used for the accumulation of resources needed to meet debt service requirements as they become due; capital project accounts used for acquisition and construction of assets funded by revenue bond proceeds; the impact fee construction account used for the accumulation and expenditure of amounts restricted by local ordinance for future plant expansion; and customers’ deposits account restricted from use by local ordinance. In addition, certain assets are restricted in the other enterprise funds due to the proper use of the assets. The most notable of these are customer deposit accounts and resources accumulated to repay outstanding debt. Restricted assets are not presented on the balance sheets of the governmental funds under the modified accrual basis of accounting; however, certain assets of these funds are restricted as to use. Such assets, consisting primarily of cash and receivables, include debt proceeds, permit fees, state and federal forfeiture awards, state and federal grants and amounts held for debt service. All applicable assets in the enterprise funds and in the governmental funds have been restricted in amounts sufficient to meet restrictive purposes.

g. Capital assets The City’s capital assets, which include property, plant, equipment, and infrastructure assets (roads, bridges, sidewalks, and similar assets), are reported in the applicable governmental or business-type activities column in the government-wide financial statements. The City defines capital assets, including infrastructure, as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. For the initial capitalization of major general fund infrastructure assets, which are reported by governmental activities, the City included all long-lived assets such as roads, sidewalks, storm drainage systems, bridges, tunnels, traffic lights, etc. The City used actual costs, where available, in assigning historical costs to the infrastructure assets. Otherwise, historical costs were assigned based on a trending analysis using current replacement costs. As the City constructs or acquires additional capital assets, they are capitalized and reported at historical cost.

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g. Capital assets (continued) Interest incurred during the construction phase of capital assets of enterprise funds is included as part of the capitalized value of the assets constructed. Normal maintenance and repairs, which do not increase the capacity or efficiency of the asset or increase its estimated useful life, are expensed. Donated capital assets are recorded at their estimated fair value at the date of donation. The City does not depreciate land, antiques and exhibits, historical buildings, intangible assets with indefinite lives, and construction in progress. Other City property, plant, equipment and infrastructure are depreciated using the straight line method over the following estimated useful lives:

Buildings 20-40 years Other improvements 15-50 years Equipment 3-15 years Infrastructure of enterprise funds 15-50 years Other infrastructure 20-40 years

h. Deferred outflows/inflows of resources

In addition to assets, the City’s statement of financial position reports a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has two types of items that qualify for reporting in this section: deferred charge on refunding and deferred outflows on pension earnings. On the government-wide statement of net position, the proprietary funds’ statement of net position in the City’s basic financial statements, and the nonmajor enterprise funds’ combining statement of net position, the City reports a deferred charge on refunding, which results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. Deferred outflows related to pension earnings are reported on the government-wide financial statements, the proprietary funds’ statement of net position in the City’s basic financial statements, the nonmajor enterprise funds’ combining statement of net position and the internal service funds’ combining statement of net position. Note 10 provides more information on this item. In addition to liabilities, the City’s statement of financial position reports a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has three types of items that qualify for reporting in this section: deferred charges on refunding, deferred inflows related to pensions and unavailable revenue. On the government-wide statement of net position, the proprietary funds’ statement of net position in the City’s basic financial statements, and the nonmajor enterprise funds’ combining statement of net position, the City reports a deferred inflow of resources for deferred charges on debt refunding. Deferred inflows related to pensions are reported on the government-wide statement of net position, the proprietary funds’ statement of net position in the City’s basic financial statements, the nonmajor enterprise funds’ combining statement of net position and the internal service funds’ combining statement of net position. Note 10 provides more information on this item. Unavailable revenue, which arises only under a modified accrual basis of accounting, is reported in the City’s governmental funds balance sheet. The governmental funds report unavailable revenues from occupational licenses and rental income that are revenues of the subsequent year, special assessments, cemetery lot sales, and grant receipts. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available.

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i. Long-term obligations

Long-term obligations, such as bonds and notes, are recorded at the fund level in the proprietary funds and at the government-wide level for the governmental and business-type activities. Amounts payable within one year are classified as current liabilities on the proprietary funds statement of net position and as noncurrent liabilities due within one year on the government-wide statement of net position.

j. Net position

Net position of the government-wide and proprietary funds is categorized as net investment in capital assets, restricted or unrestricted. The first category represents net position related to property, plant, equipment and infrastructure. The restricted category represents the balance of net position restricted by requirements of revenue bonds and other externally imposed constraints or by legislation in excess of the related liabilities payable from restricted assets.

k. Net position flow assumption

Sometimes the City will fund outlays for a particular purpose from both restricted resources, such as bond or grant proceeds, and unrestricted resources. When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, and then unrestricted resources as they are needed.

l. Fund balance flow assumption

In determining the classification of total spendable fund balance remaining at the end of the fiscal year, when an expenditure is incurred for purposes for which both restricted and unrestricted amounts are available, it is the City’s policy that expenditures will be applied first to restricted fund balance and then to unrestricted fund balance (committed, assigned, and unassigned). When unrestricted fund balance (committed, assigned, and unassigned) is available for use, it is the City’s policy to use committed resources first, then assigned, and then unassigned as needed.

m. Fund balance policy

In the fund financial statements, fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the City is bound to honor constraints on the specific purpose for which amounts in the funds can be spent. Fund balance is reported in five components – Nonspendable, restricted, committed, assigned and unassigned.

Nonspendable – This component includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. “Not in spendable form” includes items that are not expected to be converted to cash (such as inventories and prepaid amounts) and items such as the long-term amount of advances to other funds as well as property acquired for resale.

Restricted – This component consists of amounts that are subject to externally enforceable legal restrictions, which are imposed either (a) by third parties, such as creditors (through debt covenants), grantors, contributors, or laws or regulations of other governments or (b) by law through constitutional provisions or enabling legislation. Enabling legislation authorizes the City to assess, levy, charge or otherwise mandate payment of resources (from external resource providers) and includes a legally enforceable requirement (compelled by external parties) that those resources be used only for the specific purposes stipulated in the legislation.

Committed Fund Balance – This component consists of amounts that can only be used for specific purposes imposed by formal action (resolution) of the City Council, the City’s highest level of decision

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m. Fund balance policy (continued) making authority. The committed amounts are not subject to legal enforceability by external parties, as in restricted fund balance; however, these amounts cannot be used for any other purpose unless the City Council removes or changes the limitation by taking the same form of action (resolution) it employed to previously commit those amounts. Assigned Fund Balance – This component consists of amounts that are constrained by the City’s intent to be used for specific purposes but do not meet the criteria to be classified as committed. The City Council has by resolution authorized the following management officials to express intentions for assigned fund balance: (a) City Council, or (b) the City Manager, Director of Finance, or other subordinate high-level body or official possessing the authority to assign amounts to be used for specific purposes. Included in this category is any fund balance carry-forward used to balance the subsequent year’s budget. Unassigned Fund Balance – This classification represents amounts that have not been restricted, committed or assigned to specific purposes within the General Fund. The General Fund is the only fund that reports a positive unassigned fund balance amount. Other governmental funds besides the General Fund can only report a negative unassigned fund balance amount.

8. Revenues and expenditures/expenses

a. Program Revenues 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.

b. Property Taxes

The City levies property taxes each November 1, which become a lien on real and personal property located in the City. Property taxes are based on the assessed values determined by the Lee County Property Appraiser as of the prior January 1. The current year’s levy is based on taxable assessed property values totaling $4,556,320,495. The State of Florida permits the City to levy taxes up to 10 mills of assessed property valuations for the General Fund. For the 2014-2015 fiscal year, the City levied taxes of 8.7760 mills for the General Fund.

All taxes are due from property owners on March 31. However, property owners may pay a discounted tax of 1% beginning November of the taxable year for each month prior to the March 31 due date. Taxes become delinquent on April 1 and are subject to the issuance of tax sale certificates if unpaid by June 1. At September 30, 2015, delinquent property taxes are not material to the basic financial statements of the City and therefore have not been accrued as taxes receivable.

c. Compensated Absences

Employees earn vacation and sick leave in varying amounts based on length of service. Employees may also earn up to 120 hours of compensatory time. Upon termination, employees are paid 100% of the accumulated vacation and compensatory time at current base hourly rates. Vacation accumulation is capped at a maximum number of hours depending on employee category and bargaining unit. Upon termination of employment, if the employee is eligible to receive retirement benefits, either regular or early benefits, whether or not the benefits begin at termination or are deferred, the employee receives 33% of accumulated sick leave paid at the employee’s current base hourly rate. The current portion of compensated absences payable is the amount estimated to be used or paid in the following fiscal year.

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8. Revenues and expenditures/expenses (continued)

c. Compensated Absences (continued)

Liability for accrued compensated absences of the governmental activities is not reported in the balance sheet of the governmental funds and, accordingly, represents a reconciling item between the fund and government-wide presentations. All compensated absences are accrued when incurred in the government-wide, proprietary and fiduciary fund financial statements. All compensated absences are liquidated as part of salary expense in the division and fund that pays the salaries of the employees. These funds include the General Fund, Street Maintenance Special Revenue Fund, State Housing Partnership Special Revenue Fund, Fort Myers Redevelopment Agency Special Revenue Fund, Water–Wastewater Enterprise Fund, Solid Waste Enterprise Fund, the Building, Permits and Inspection Enterprise Fund, Stormwater Enterprise Fund, Fort Myers Country Club Enterprise Fund, Eastwood Golf Course Enterprise Fund, Yacht Basin Enterprise Fund, Harborside Event Center Enterprise Fund, Skatium Enterprise Fund, Department of Cultural and Historic Affairs Enterprise Fund, Central Garage Internal Service Fund, Information Technology Services Internal Service Fund, and the Risk Management Internal Service Fund.

d. Proprietary funds operating and non-operating revenues and expenses

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 proprietary funds and the internal service funds are charges to customers for sales and services. The Water-Wastewater Utility Enterprise Fund also recognizes as operating revenues the portion of tap fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise 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.

9. Other Policies

a. Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from these estimates. Significant estimates used in these financial statements include the amount of insurance claims payable (Note 14).

b. Encumbrances

Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded as a reservation of budget, is employed as an extension of the statutorily required budgetary process. All encumbrances lapse at year end. Contracts that require completion after the fiscal year end must be re-appropriated in the subsequent year. Note 13 provides disclosure on the City’s outstanding encumbrances as of September 30, 2015.

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September 30, 2015

NOTE 2 – RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS

Explanation of certain differences between the governmental fund balance sheet and the government-wide statement of net position The governmental fund balance sheet includes a reconciliation between fund balance – total governmental funds and net position – governmental activities as reported in the government-wide statement of net position. One element of that reconciliation explains that “capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.” The details of this $146,819,646 are as follows:

Land $ 25,354,441 Antiques and Exhibits 251,871 Construction in progress 8,839,726 Intangibles - easements 3,561,031 Buildings 22,795,045

Less: Accumulated depreciation for buildings (11,798,229)Improvements 47,389,284

Less: Accumulated depreciation for improvements (24,350,685)Equipment 14,293,091

Less: Accumulated depreciation for equipment (11,929,585)Intangibles - softwareLess: Accumulated depreciation for intangibles - softwareInfrastructure 268,089,841

Less: Accumulated depreciation for infrastructure (195,676,185)

Net adjustment to increase fund balance - total governmental funds to arriveat net position - governmental activities $ 146,819,646

Another element of that reconciliation explains that “long-term liabilities, including revenue bonds payable, are not due and payable in the current period and, therefore, are not reported in the funds.” The details of this $251,096,869 are as follows:

Revenue bonds payable $ 101,502,491Less: Deferred charge on refunding (to be amortized as interest expense) (3,398,988)Less: Bond insurance costs (to be amortized over life of debt) (314,029)

Loans and notes payable 3,793,249Capital leases payable 425,625Accrued interest payable 1,525,791Accrued retirement payable 14,096,699Net pension liability 129,110,365

Less: Deferred outflows on pension earnings (16,194,184)Plus: Deferred inflows related to pensions 257,032

Due to private sources 6,000,000Claims and judgments 1,473,233Compensated absences 3,483,082Other postemployment benefits payable 9,336,503

Net adjustment to reduce fund balance - total governmental funds to arriveat net position - governmental activities $ 251,096,869

Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes in fund balances – total governmental funds and changes in net position of governmental

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September 30, 2015

NOTE 2 – RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued)

Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities (continued) activities as reported in the government-wide statement of activities. One element of that reconciliation explains that “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 as depreciation expense. This is the amount by which depreciation expense exceeded capital outlay in the current period.” The details of this $(897,117) difference are as follows on the next page: Capital outlay $ 9,495,953 Non-capitalizable expenditures in capital outlay (583,140) Current year depreciation (9,809,930)

Net adjustment to decrease net changes in fund balances-totalgovernmental funds to arrive at changes in net position ofgovernmental activities $ (897,117)

Another element of that reconciliation states that “the issuance of long-term debt, such as bonds and leases, provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and similar terms when debt is first issued, whereas these amounts are deferred and amortized in the statements of activities. This amount is the net effect of these differences in the treatment of long-term debt and related items.” The details of this $(1,300,439) difference are as follows: Debt issued or incurred:Installment agreement $ 320,172Due to private sources 6,000,000

Principal repayments:General revenue bonds (6,813,035)Loans and notes (521,153)Capital lease (84,375)Installment agreement (202,048)

Net adjustment to decrease changes in fund balances - totalgovernmental funds to arrive at changes in net position ofgovernmental activities $ (1,300,439)

Another element of that reconciliation states that “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 the governmental funds.” The details of this $3,475,635 difference are as follows: Amortization of bond premiums $ 298,674

Amortization of bond insurance costs (33,531)Amortization of deferred charge on refunding (271,901)Change in retirement payable 1,085,414Change in other postemployment benefits payable (1,129,678)

Change in accrued interest expense (11,689)Change in net pension liability 3,309,035Change in compensated absences 229,311

Net adjustment to decrease net changes in fund balances - totalgovernmental funds to arrive at changes in net position ofgovernmental activities $ 3,475,635

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September 30, 2015

NOTE 3 – STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY

Deficit fund balance The following governmental funds had a deficit fund balance at September 30, 2015:

Grants Fund $ (16,977) Community Development Block Grant Fund (669)

Total deficit fund balance $ (17,646)

The deficit fund balance for the above funds resulted from expenditures for which related revenue was not recognized because of the timing of the reimbursements. The deficit was eliminated subsequent to year-end upon receipt of reimbursement funding. NOTE 4 – CASH DEPOSITS AND INVESTMENTS

Cash Deposits with Financial Institutions At September 30, 2015, the carrying amount of the City’s deposits was $111,400,627 and the banks’ balances were $112,201,384. The difference was due to checks that had been written but not yet paid by the banks and deposits in transit. Custodial credit risk is the risk that in the event of a bank failure, the City’s deposits may not be returned to the City. These deposits are insured by the Federal Deposit Insurance Corporation or by collateral pursuant to the Florida Security for Public Deposits Act (Florida Statutes Chapter 280). Under this Act, financial institutions that qualify as public depositories pledge securities that have a market value equal to 50% - 125% of the average daily balance for each month of all public deposits in excess of applicable deposit insurance. The Public Deposit Security Trust Fund has a procedure to allocate and recover losses in the event of default or insolvency. When public deposits are made in accordance with Chapter 280, no public depositor shall be liable for any loss thereof. Investments Florida Statutes, the City’s Investment Policy and various bond covenants authorize investments that include money market accounts, savings accounts, interest bearing time deposits, repurchase agreements, the Local Government Surplus Funds Trust Fund administered by the Florida State Board of Administration (SBA) or other local government investment pool authorized by F.S. §163.01, obligations of the U.S. Government, government agencies guaranteed by the U.S. Government and certain bond mutual funds. Derivative products are prohibited unless specifically approved by City Council in advance. 1. City’s Investments

The City’s investment policy applies to the investment of short-term operating funds of the City of Fort Myers and all of its dependent special districts. Longer-term funds, including its employee retirement system funds, funds related to the issuance of debt, and other funds held pursuant to trust agreements administered, are covered by separate policies, contracts or agreements in effect for such funds.

Except for longer-term and restricted funds, all cash balances of all funds, including the General Fund, Special Revenue Funds, Debt Service Funds, Capital Projects Funds, Utility Fund and other proprietary funds that exist or may be created from time to time, shall be consolidated and administered in accordance with the provisions of this policy. The basic goals of Fort Myers’ investment program are, in order of priority:

Safety of investments; Maintenance of sufficient liquidity to meet cash flow needs, and; Attainment of a market average rate of return (yield), taking into account the City’s investment risk

constraints and the cash flow characteristics of the portfolio.

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September 30, 2015

NOTE 4 – CASH DEPOSITS AND INVESTMENTS (continued)

1. City’s Investments (continued)

The City’s cash and investment pool consists of the Local Government Surplus Funds Trust Fund investment account administered by the Florida State Board of Administration (the “Florida PRIME” Pool) and cash. Cash balances and requirements of all funds are considered in determining the amount to be invested. Interest earned on pooled cash and investments is allocated monthly to funds based on their average weekly cash balances. Florida PRIME is governed by Chapters 215 and 218, Florida Statutes, and Chapter 19-7 of the Florida Administrative Code (collectively, “Applicable Florida Law”). The Board of Trustees of the SBA (“Trustees”) consists of the Governor, as Chairman, the Chief Financial Officer, as Treasurer, and the Attorney General, as Secretary. The Trustees will annually certify that Florida PRIME complies with the requirements of Chapter 218, Florida Statutes, and that the management of Florida PRIME is in accord with best investment practices.

The Trustees delegate the administrative and investment authority to manage Florida PRIME to the Executive Director of the SBA, subject to Applicable Florida Law. The Trustees appoint an Investment Advisory Council and a Participant Local Government Advisory Council. Both Councils will, at least annually, review this Policy and any proposed changes prior to its presentation to the Trustees and will undertake other duties set forth in Applicable Florida Law. Pursuant to Florida law, the Auditor General will conduct an annual financial audit of Florida PRIME, which will include testing for compliance with this Policy. The primary investment objectives for Florida PRIME, in priority order, are safety, liquidity, and competitive returns with minimization of risks. Investment performance of Florida PRIME will be evaluated on a monthly basis against the Standard & Poor’s U.S. AAA & AA Rated GIP All 30 Day Net Yield Index. While there is no assurance that Florida PRIME will achieve its investment objectives, it endeavors to do so by following the investment strategies described in its investment policy. See Note 1, 7. b., Investments, for a discussion of how the shares in Florida PRIME are valued.

The following disclosures pertain to Florida PRIME as of September 30, 2015:

Credit Quality Disclosure: Florida PRIME is rated by Standard and Poor’s, and the current rating is “AAAm”.

Interest Rate Risk Disclosure: The dollar weighted average days to maturity (WAM) of the Florida PRIME is 29 days. Next interest rate reset dates for floating rate securities are used in the calculation of the WAM.

Foreign Currency Risk Disclosure: The Florida PRIME was not exposed to any foreign currency risk during the period from October 1, 2014 through September 30, 2015.

At September 30, 2015, the City had the following investments:

Investments Fair Value as of

September 30, 2015 Weighted Average

Maturity (in years) Cash equivalents $ 1,947,982 - Money market funds 14,910,967 -

Fixed Income: Treasury and Agency securities 39,075,446 1.201 Corporate bonds 5,848,139 0.967 Asset backed securities 756,074 3.327

Corporate stocks 78,727 - Florida PRIME Investment Pool 13,133,055 0.080 Total Cash Equivalents and Investments $ 75,750,390

Portfolio weighted average maturity 0.745

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September 30, 2015


1. City’s Investments (continued)

Interest Rate Risk In accordance with its investment policy, the City mitigates its interest rate risk by structuring the City’s portfolio so that the securities mature to meet the City’s cash requirements, thereby avoiding the need to sell securities on the open market prior to their maturation; and investing primarily in shorter-term securities, unless it can be anticipated that long-term securities can be held to maturity without jeopardizing liquidity requirements. Credit Risk Safety of principal is the foremost objective of the City’s investment policy. The City’s policy limits the credit risk by limiting investments to the safest types of securities; pre-qualifying the financial institutions with which it will conduct business; diversifying the investment portfolio so that the failure of any one issuer or backer will not place an undue financial burden upon the City; and monitoring all the City’s investments on a daily basis to anticipate and respond appropriately to a significant reduction of credit worthiness of any of the depositories. As of September 30, 2015, the City’s investments in money market funds were rated AAAm by Standard & Poor (S&P), Aaa-mf by Moody’s Investors Service (Moody’s) and AAAmmf by Fitch Ratings. Treasury and agency securities were rated Aaa by Moody’s and AA+ by S&P. The City’s investments in corporate bonds were rated Aaa by Moody’s and A+ by S&P. One investment in asset backed securities was rated Aaa by Moody’s and AA- by S&P; two investments were not rated.

2. City’s Pension Plan Investments The City reports three pension funds in the accompanying financial statements. Each of the plans has a separate governing board of trustees, a separate investment policy, and differing investment restrictions. Consequently, each plan is disclosed separately below. All investments at the fiscal year end were in compliance with the respective plan investment policies. At September 30, 2015, the City’s three pension plans had the following cash and investments, which are reported at fair value (generally based on quoted market prices):

Description Fair Value Credit Rating:

Standard & Poor’s Credit Rating:

Moody’s General Employees’ Pension Plan: Cash $ 50,404 Money market 5,089,784 A-1 P1 U.S. government and agency securities 1,352,066 AA+ Aaa Municipal bonds 908,526 AAA to A Aaa to A2 Corporate stock 35,681,973 Not rated Not rated Corporate stock – ADR 888,884 Not rated Not rated Corporate bonds 4,075,214 AAA to BB+ Aaa to Ba2 Mortgage backed securities 7,396,726 AAA to A Aaa to A2 Asset backed securities 2,935,067 AAA to AA+ Aaa Mutual funds – Fixed income 7,164,271 Not rated Not rated Limited partnership – International equity 11,091,155 Not rated Not rated Private placements 90,748 AA- to BBB+ A1 to Baa2 Real estate investment trusts 10,569,936 Not rated Not rated International securities: Bonds and notes 513,620 AA+ to BBB- Aaa to Ba1 Stocks 3,583,193 Not rated Not rated Total 91,391,567

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September 30, 2015


2. City’s Pension Plan Investments (continued)

Description Fair Value Credit Rating:

Standard & Poor’s Credit Rating:

Moody’s Firefighters’ Retirement System: Cash 38,551 Money market 2,004,500 AAA m Aaa-mf U.S. government and agency securities 2,489,024 AAA to AA+ Aaa Corporate stock 34,801,116 Not rated Not rated Corporate bonds 6,438,704 AA+ to BBB- Aaa to Baa3 Asset backed securities 1,849,877 AAA Aaa Mutual funds: Fixed income 2,360,226 Not rated Not rated International equity 8,625,305 Not rated Not rated Limited partnerships – Real estate 8,829,697 Not rated Not rated Total 67,437,000 Police Officers’ Retirement System: Cash 1,143,075 Money market 1,597,256 AAA m Aaa-mf U.S. government and agency securities 10,789,471 AA+ Aaa Corporate stock 20,413,981 Not rated Not rated Corporate bonds 2,128,779 AA+ to BBB+ Aa1 to Baa3 Convertible bonds 6,598,317 A- to BBB- A2 to Caa1 Convertible preferred 2,072,260 BBB- to B- Baa1 to Baa3 Mortgage backed securities 5,602,919 AA+ Aaa Mutual funds: Equity 15,911,308 Not rated Not rated International equity 9,618,189 Not rated Not rated Commingled funds – Real estate 9,295,805 Not rated Not rated Master limited partnerships 1,880,512 Not rated Not rated Total 87,051,872 Total Cash and Investments $245,880,439

For the year ended September 30, 2015, the annual money-weighted rate of return on pension plan investments for each Plan was as follows:

General Employees’ Pension Plan 0.36% Police Officers’ Retirement System -0.98% Firefighters’ Retirement System -0.78%

The money-weighted rate of return expresses investment performance, net of pension plan investment expense, adjusted for the changing amounts actually invested. A schedule of each Plan’s investment returns is presented on page 108. a. General Employees’ Pension Plan

Investment Policy

In fulfilling their fiduciary responsibility, the Pension Board of Trustees (the Board) for the General Employees’ Pension Plan (GEPP) established an Investment Policy Statement and directed that it apply to all assets under their control. The general investment objective is to obtain a reasonable total rate of return – defined as interest and dividend income plus realized and unrealized capital gains or losses – commensurate with the Prudent Investor Rule and any other applicable ordinances and statutes. The Board employs investment professionals to oversee and invest the assets of the Plan. The Board, in

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September 30, 2015



a. General Employees’ Pension Plan (continued)

Investment Policy (continued) performing their investment duties, shall comply with the fiduciary standards set forth in the Employee Retirement Income Security Act of 1974 (ERISA) at 29 U.S.C. s. 1104(a) (1) (A) – (C).

It is the Board’s intention to review the Investment Policy Statement at least annually subsequent to the actuarial report and to amend the statement to reflect any changes in philosophy, objectives or guideline. If, at any time, the investment manager feels that the specific objectives defined in the Investment Policy Statement cannot be met, or the guidelines constrict performance, the Board shall be notified in writing.

Investment policy decisions may be recommended by the investment manager, reviewed by the Plan’s legal counsel for compliance with applicable law, and approved by a majority vote of the Board. Upon adoption by the Board, the Investment Policy Statement shall be promptly filed with the Florida Department of Management Services, the City, and the Plan’s actuary. The effective date of the Investment Policy Statement shall be thirty days following the filing date with the City. As of September 30, 2015, the effective Investment Policy Statement was adopted on June 18, 2014 and there were no amendments in the current fiscal year.

Target Allocations

In order to provide for a diversified portfolio, the Board engaged investment professional(s) to manage and administer the fund. The investment managers are responsible for the assets and allocation of their mandate only. They will monitor the aggregate asset allocation of the portfolio and rebalance to the target asset allocation based on market conditions. If at the end of any calendar quarter, the allocation of an asset class falls outside of its allowable range, barring extenuating circumstances, the asset allocation will be rebalanced into the allowable range. The Board does not intend to exercise short-term changes to the target allocation.

The following was the Board’s adopted asset allocation policy as of September 30, 2015:

Asset Class Target Range Benchmark Index

Domestic Equity 45% 40% - 60% Russell 3000

International Equity 15% 5% - 20% MSCI-ACW ex. US

Broad Market Fixed Income 20% 20% - 30% Barclays Capital Intermediate Aggregate

Real Return Assets * 5% 0% - 10% Barclays Capital TIPS 1 - 10 Year

Global Fixed Income * 5% 0% - 10% Citigroup World Government Bond Index

Real Estate * 10% 0% - 15% NCREIF NFI-ODCE

* Benchmark w ill default to "broad market f ixed income" if these portfolios are not funded. Targets andranges above are based on market value of total Plan assets.

Authorized investments comprise domestic securities, domestic fixed income investment grade bonds, treasury inflation protected securities, pooled funds, real estate, and foreign securities. The board may make investments in the money market fund or short-term investment fund options provided by the Plan’s custodian with the provision that those investments have a minimum rating of A1/P1, or its equivalent, by a major credit rating service. Eighty-five (85%) of the fixed income investments shall have a minimum rating of investment grade or higher as reported by a major credit rating service.

No investments shall be permitted in any investment not specifically allowed as part of the policy or illiquid investments, as described in Chapter 215.47, Florida Statutes.

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September 30, 2015




Concentration of Credit Risk

Not more than 5% of the Plan’s assets, at the time of purchase, shall be invested in the common stock, capital stock or convertible stock of any one issuing company, nor shall the aggregate investment in any one issuing company exceed 5% of the outstanding capital stock of the company. For fixed income, the value of bonds issued by any single corporation shall not exceed 3% of the total fund. Investments in corporate common stock and convertible bonds shall not exceed 70% of the market value of the Plan’s assets. Foreign securities, regardless of asset class, shall not exceed 25% of the market value of the Plan’s assets. The following investments represent 5% or more of the Plan’s fiduciary net position and are not issued or explicitly guaranteed by the U.S. government:

Amount of % of

Investment Investment Net Position

Corporate stock 35,681,973$ 39.1%

Mortgage backed securities * 7,396,726 8.1%

Mutual funds - Fixed income ** 7,164,271 7.8%

Limited partnership - International equity 11,091,155 12.1%

Real estate investment trusts 10,569,936 11.6%

Total Plan investments 5% or more of the f iduciary net position 71,904,061$ 78.7%

* Of the 8.1% for the mortgage backed securities, 25.2%, or $1,863,975, of the total investment of $7,396,726 was not backed by the U.S. government. ** Fixed income mutual funds comprise individual investments of 3.8%, or $3,499,664, and 4.0%, or $3,664,607. Custodial Credit Risk

Custodial credit risk is the risk that, in the event of the failure of the counterparty, the General Employees’ Pension Plan will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. Pursuant to Section 112.661 (10), Florida Statutes, the Plan’s investment policy states that securities should be held with a third-party custodian, and all securities purchased by, and all collateral obtained by the pension fund should be designated as an asset of the Plan. As of September 30, 2015, the Plan’s investment portfolio was held with a third-party custodian as required by the statute.

Foreign Currency Risk

Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or a deposit. As noted above, the Plan’s investment policy states that foreign securities, regardless of asset class, shall not exceed 25% of the market value of the Plan’s assets. The Plan’s actual investment in foreign securities at September 30, 2015 was $4,096,813 or 4.5% of the Plan’s total assets at market value. The Plan also held foreign investments that comprised a limited partnership in international equity, which amounted to $11,091,155 or 12.1% of the Plan’s total assets at fair market value as of September 30, 2015.

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September 30, 2015




At September 30, 2015, the General Employees’ Pension Plan investments, other than stocks, stock related funds, mutual funds, limited partnership and real estate investment trusts, were as follows:

Investment Type Fair Value Less than 1 1-5 6-10 More than 10

Money market 5,089,784$ 5,089,784$ -$ -$ -$ U.S. government and agency securities 1,352,066 - 567,525 784,541 - Municipal bonds 908,526 - 392,583 480,449 35,494 Corporate bonds 4,075,214 221,026 1,919,631 1,651,473 283,084 Mortgage backed securities 7,396,726 - 437,463 944,697 6,014,566 Asset backed securities 2,935,067 29 939,548 771,191 1,224,299 Private placements 90,748 - 50,764 39,984 - International securities - bonds and notes 513,620 20,673 110,964 381,983 -

Total Investments 22,361,751$ 5,331,512$ 4,418,478$ 5,054,318$ 7,557,443$

Investment Maturities (in Years)

b. Firefighters’ Retirement System

Investment Policy

In fulfilling their fiduciary responsibility, the Pension Board of Trustees (the Board) for the Firefighters’ Retirement System (FRS) established an Investment Policy Statement and directed that it apply to all assets under their control. The general investment objective is to obtain a reasonable total rate of return – defined as interest and dividend income plus realized and unrealized capital gains or losses – commensurate with the Prudent Investor Rule and any other applicable ordinances and statutes. The Board employs investment professionals to oversee and invest the assets of the Plan. The Board, in performing their investment duties, shall comply with the fiduciary standards set forth in the Employee Retirement Income Security Act of 1974 (ERISA) at 29 U.S.C. s. 1104(a) (1) (A) – (C).

It is the Board’s intention to review the Investment Policy Statement at least annually subsequent to the actuarial report and to amend the statement to reflect any changes in philosophy, objectives or guideline. If, at any time, the investment manager feels that the specific objectives defined in the Investment Policy Statement cannot be met, or the guidelines constrict performance, the Board shall be notified in writing.

Investment policy decisions may be recommended by the investment manager, reviewed by the Plan’s legal counsel for compliance with applicable law, and approved by a majority vote of the Board. Upon adoption by the Board, the Investment Policy Statement shall be promptly filed with the Florida Department of Management Services, the City, and the Plan’s actuary. The effective date of the Investment Policy Statement shall be thirty days following the filing date with the City. As of September 30, 2015, the effective Investment Policy Statement was adopted on June 13, 2013 and there were no amendments in the current fiscal year.

Target Allocations

In order to provide for a diversified portfolio, the Board engaged investment professional(s) to manage and administer the fund. The investment managers are responsible for the assets and allocation of their mandate only. They will monitor the aggregate asset allocation of the portfolio and rebalance to the target asset allocation based on market conditions. If at the end of any calendar quarter, the allocation of an asset class falls outside of its allowable range, barring extenuating circumstances, the asset allocation will be rebalanced into the allowable range. The Board does not intend to exercise short-term changes to the target allocation.

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September 30, 2015



b. Firefighters’ Retirement System (continued)

Target Allocations (continued)


Asset Class Target Range Benchmark Index

Domestic Equity 50% 40% - 65% Russell 3000

International Equity 15% 5% - 20% MSCI-ACW ex. US

Broad Market Fixed Income 17% 20% - 30% Barclays Aggregate

Global Fixed Income * 5% 0% - 10% Citigroup World Government Bond Index

Alternatives * 3% 0% - 5% NCREIF Timber

Real Estate * 10% 0% - 15% NCREIF NFI-ODCE

* Benchmark w ill default to "broad market f ixed income" if these portfolios are not funded. Targets andranges above are based on market value of total Plan assets.

Authorized investments comprise domestic securities, domestic fixed income investment grade bonds, treasury inflation protected securities, pooled funds, real estate, and foreign securities. The board may make investments in the money market fund or short-term investment fund options provided by the Plan’s custodian with the provision that those investments have a minimum rating of A1/P1, or its equivalent, by a major credit rating service. Eighty-five (85%) of the fixed income investments shall have a minimum rating of investment grade or higher as reported by a major credit rating service.

No investments shall be permitted in any investment not specifically allowed as part of the policy or illiquid investments, as described in Chapter 215.47, Florida Statutes. Direct investment in ‘Scrutinized Companies’ identified in the periodic publication by the State Board of Administration is prohibited.


Not more than 5% of the Plan’s assets, at the time of purchase, shall be invested in the common stock, capital stock or convertible stock of any one issuing company, nor shall the aggregate investment in any one issuing company exceed 5% of the outstanding capital stock of the company. For fixed income, the value of bonds issued by any single corporation shall not exceed 3% of the total fund. Investments in corporate common stock and convertible bonds shall not exceed 75% of the fund assets at market value. Foreign securities, regardless of asset class, shall not exceed 25% of the market value of the Plan’s assets. The following investments represent 5% or more of the Plan’s fiduciary net position and are not issued or explicitly guaranteed by the U.S. government:

Amount of % of



Corporate bonds 6,438,704 8.9%

Mutual funds - International equity 8,625,305 11.9%

Limited partnerships - Real estate 8,829,697 12.1%


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September 30, 2015



b. Firefighters’ Retirement System (continued)

Custodial Credit Risk

Custodial credit risk is the risk that, in the event of the failure of the counterparty, the Firefighters’ Retirement System pension plan will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. Pursuant to Section 112.661 (10), Florida Statutes, the Plan’s investment policy states that securities should be held with a third-party custodian, and all securities purchased by, and all collateral obtained by the pension fund should be designated as an asset of the Plan. As of September 30, 2015, the Plan’s investment portfolio was held with a third-party custodian as required by the statute.


Foreign currency risk is the risk that changes in exchange rates that will adversely affect the fair value of an investment or a deposit. As noted above, the Plan’s investment policy states that foreign securities, regardless of asset class, shall not exceed 25% of the market value of the Plan’s assets. The Plan’s foreign investment as of September 30, 2015, comprised mutual funds in international equity, which amounted to $8,625,305 or 11.8% of the Plan’s total assets at fair market value.

At September 30, 2015, the Firefighters’ Retirement System plan investments, other than stocks, mutual funds and limited partnership, were as follows:


Money market 2,004,500$ 2,004,500$ -$ -$ -$ U.S. government and agency securities 2,489,024 80,012 1,872,276 - 536,736 Corporate bonds 6,438,704 239,079 1,353,112 3,556,639 1,289,874 Asset backed securities 1,849,877 - 1,191,402 658,475 -

Total Investments 12,782,105$ 2,323,591$ 4,416,790$ 4,215,114$ 1,826,610$

Investment Maturities (in Years)

c. Police Officers’ Retirement System

Investment Policy

The Board of Trustees (the Board) for the Police Officers’ Retirement System (PORS) established a Statement of Investment Policy that applies to those funds under control of the Board. The investment objective of the Board is to preserve the purchasing power of the Fund’s assets and earn an above average real rate of return (after inflation) over the long term while minimizing, to a reasonable extent, the short term volatility of results. The Board determined that one or more outside investment managers shall be retained to assure that all investments are managed in both a prudent and professional manner and in compliance with the stated investment guidelines. In performing its investment duties, the Board and its investment managers shall comply with the fiduciary standards set forth in the Employee Retirement Income Security Act of 1974 (ERISA) at 29 U.S.C. s. 1104(a) (1) (A) – (C).

It is the intention of the Board to review the Investment Policy Statement and its addenda periodically and to amend it to reflect any changes in philosophy or objectives. However, if at any time the investment managers believe that the specific objectives defined herein cannot be met or that the guidelines unnecessarily constrict performance, the Board shall be so notified in writing.

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September 30, 2015



c. Police Officers’ Retirement System

Investment Policy (continued) As of September 30, 2015, the effective Investment Policy Statement was adopted on June 5, 2014. Changes to the Plan’s investment policy comprised the inclusion of publicly traded master limited partnerships as an authorized investment.

Investment policy decisions may be recommended by the investment manager, reviewed by the Plan’s legal counsel for compliance with applicable law, and approved by a majority vote of the Board.

Target Allocations

To achieve the investment objectives, the Board, as named fiduciary of the PORS Pension Fund, seeks to create a well-diversified and balanced portfolio of equity, fixed income, real estate, convertibles and money market securities. The Board determines that one or more outside investment managers shall be retained to assure that all investments are managed in both a prudent and professional manner and in compliance with the stated investment guidelines. Each investment manager is responsible only for those assets under their management. It may be necessary to rebalance the portfolio periodically in order to maintain policy targets and diversification. The Board monitors each component of the Plan periodically and makes adjustments as necessary.


Asset Class Target Range

Domestic Large Cap Equities 32.5% 30% - 65%

Convertible Securities 10% 0% - 25%

Domestic Small/Mid Cap Equities 7.5% 5% - 20%

Master Limited Partnerships 5% 0% - 15%

Foreign Securities 15% 5% - 25%

Real Estate 5% 0% - 10%

Fixed Income Securities 25% 25% - 60%

Cash 0% 0% - 10%

Authorized investments comprise equities, convertibles, publicly traded master limited partnerships, real estate, fixed income and cash equivalent securities. Investments in equity securities and convertibles shall be limited to easily and readily negotiable securities. All real estate investments shall be made through participation in diversified commingled funds of real properties or real estate securities. Such funds shall be broadly diversified as to property type and location.

The fixed income portfolio shall comply with the following guidelines: Investments in all corporation fixed income securities shall be limited to those securities rated BBB

or higher by Standard & Poor’s or Baa by Moody’s rating services. Investments in securities rated below A will be limited to 20% of the total fixed income portfolio. Fixed income securities that are downgraded below the minimum rating by both entities shall be sold at the earliest beneficial opportunity.

Investments in collateralized mortgage obligations (CMOs) shall be backed by the full faith of the U.S. government, an agency thereof, or that are rated AAA by a major rating service. The CMOs shall be restricted to planned amortization class, non-accelerated securities or very accurately defined maturity securities.

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September 30, 2015



c. Police Officers’ Retirement System (continued) Target Allocations (continued) Investment managers may invest only in the following short-term investment vehicles: The money market fund or short-term investment fund options provided by the Fund’s custodian. Direct obligations of the U.S. government, its agencies or instruments with a maturity of one year or

less. Commercial paper issued by U.S. corporations that has a maturity of 270 days or less and that is

rated A-1 by Standard & Poor’s or P-1 by Moody’s.

Prohibited investments include repurchase agreements, 144A convertible securities, and direct investments in interest only or principal only CMOs, precious metals, limited partnerships of any kind, real estate, venture capital, futures contracts, options contracts, trading on margin and short sales. If an investment becomes illiquid or in the event that the Fund acquires an illiquid investment, the Board shall develop the methodology for valuation as set forth in the criteria in Section 215.47(6), Florida Statutes.


The Board developed a diversified investment program to control the risk of loss resulting from over concentration in a specific maturity, issuer, instrument, dealer or bank through which financial instruments are bought and sold. Measures to control the risk include the following:

Equity securities: Investments in equity securities, including convertibles, shall not exceed 70% (at

cost value) or 75% (at market value) of the Fund’s total portfolio; no more than 25% of the Fund’s total market value may be invested in foreign equity securities; no more than 5% at market value of the total equity portfolio may be invested in the shares of a single corporate issuer; investments in those corporations whose stock has been publicly traded for less than one year is limited to 15% of the equity portfolio; investments issued by corporations with total market capitalization of $3 billion or less shall not exceed 20% of total equity portfolio value (at market).

Convertible securities: All such securities shall be classified as equities and shall be limited to 25% of the Fund’s total portfolio value; no more than 10% at market value of an investment manager’s convertible portfolio may be invested in the shares of a single corporate issuer; investments in foreign convertibles are limited to 25% (at market) of the investment manager’s portfolio.

Corporate fixed income securities: No more than 25% of the Fund’s total market value may be invested in foreign equity securities; no more than 10% at market of an investment manager’s total fixed income portfolio shall be invested in the securities of any single corporate issuer.

Investments in CMOs shall be limited to 15% of the market value of the investment managers’ total portfolio.

Master limited partnerships (MLP): No more than 10% at market value of an investment manager’s MLP may be invested in a single issuer unless the issuer makes up more than 10% of the Alerian MLP Index; no more than 15% of the total fund assets (at market value) may be invested in MLPs.

Investments in real estate shall not exceed 15% at market valuation of the value of total Fund assets.

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September 30, 2015



c. Police Officers’ Retirement System (continued)

Concentration of Credit Risk (continued)

The following investments represent 5% or more of the Plan’s fiduciary net position and are not issued or explicitly guaranteed by the U.S. government:

Amount of % of



Convertible bonds 6,598,317 6.8%

Mortgage backed securities * 5,602,919 5.8%

Mutual funds:

Equity 15,911,308 16.4%

International equity 9,618,189 9.9%

Commingled Funds - Real estate 9,295,805 9.6%


Of the 5.8% for the mortgage backed securities, 16.1%, or $902,070, of the total investment of $5,602,919 was not backed by the U.S. government.

Custodial Credit Risk

Custodial credit risk is the risk that, in the event of the failure of the counterparty, the Police Officers’ Pension Plan will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. Pursuant to Section 112.661 (10), Florida Statutes, the Plan’s investment policy states that securities should be held with a third-party custodian, and all securities purchased by, and all collateral obtained by the pension fund should be designated as an asset of the Plan. As of September 30, 2015, the Plan’s investment portfolio was held with a third-party custodian as required by the statute.


Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or a deposit. As noted above, the Plan’s investment policy states that no more than 25% of the Fund’s total market value may be invested in foreign equity securities and investments in foreign convertibles are limited to 25% (at market) of the investment manager’s portfolio. The Plan’s foreign investment as of September 30, 2015 comprised mutual funds in international equity, which amounted to $9,618,189 or 9.9% of the Plan’s total assets at fair market value.

At September 30, 2015, the Police Officers’ Retirement System pension plan investments, other than stocks, mutual funds, commingled funds and master limited partnership, were as follows:

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September 30, 2015



c. Police Officers’ Retirement System (continued)


Money market 1,597,256$ 1,597,256$ -$ -$ -$ U.S. government and agency securities 10,789,471 - - 10,789,471 - Corporate bonds 2,128,779 - - 2,128,779 - Convertible bonds 6,598,317 263,087 3,591,760 1,227,598 1,515,872 Convertible preferred 2,072,260 2,072,260 - - - Mortgage backed securities 5,602,919 - 175,618 4,403,519 1,023,782

Total investments 28,789,002$ 3,932,603$ 3,767,378$ 18,549,367$ 2,539,654$

Investment Maturities in Years

NOTE 5 – RESTRICTED ASSETS

Certain assets of the proprietary funds at September 30, 2015 are restricted for certain purposes. These assets included cash and cash equivalents, investments and interest receivable.

PurposeCustomer deposits $ 6,875,637 $ - $ 149,977 Revenue bonds debt service accounts 14,567,188 31,732 30,273 Impact fee capital contributions accounts 6,549,995 - - Revenue bond renewal and replacement accounts 9,808,266 323,474 161,080 Revenue bond and note construction accounts 7,634,194 - 226,231 Capital project accounts 4,255,376 83,384 146,887 Other purposes - - 82,229

Total restricted assets $ 49,690,656 $ 438,590 $ 796,677

Solid Waste Business-type

Fund Fund Funds

Water - Nonmajor

Wastewater

Restricted cash and cash equivalents of $3,455,479 in the Risk Management Internal Service Fund relates to the City’s self-insurance activities. Note 14 provides more information about the City’s Risk Management.

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September 30, 2015

NOTE 6 – RECEIVABLES

Amounts are aggregated into a single accounts receivable (net of allowance for uncollectible) line for certain funds and aggregated columns. Receivables as of September 30, 2015 for the City’s governmental activities, individual major governmental funds, nonmajor governmental funds in the aggregate, internal service funds and applicable allowances for uncollectible accounts are as follows:

Receivables:Accounts $ 328,290 $ 200,000 $ 89,540 $ 1,662 $ 619,492 Utility Service Taxes and Franchise Fees 1,951,879 - - - 1,951,879 Code Enforcement 1,355,630 - - - 1,355,630 Accounts, gross 3,635,799 200,000 89,540 1,662 3,927,001

Less: Allowance for uncollectibles (832,604) - - - (832,604) Accounts, net 2,803,195 200,000 89,540 1,662 3,094,397

Notes - - 6,155,326 - 6,155,326 Less: Allowance for uncollectibles - - (6,155,326) - (6,155,326)

Notes, net - - - - -

Total net receivables $ 2,803,195 $ 200,000 $ 89,540 $ 1,662 $ 3,094,397

GeneralFund

TransportationCapital

Projects Total

NonmajorGovernmental

Funds

InternalService

Fund

Significant Uncollectible The allowance for uncollectible accounts receivable in the General Fund consists primarily of $764,071 for code enforcement fees. The amount of $6,155,326 for the allowance for uncollectible notes receivable in the Nonmajor Governmental Funds relates to mortgage assistance provided by the Attainable Workforce Housing Fund, State Housing Initiative Partnership (SHIP) Fund, and Community Development Block Grant Fund. The Attainable Workforce Housing Fund provides loans to eligible residents with income of 150% of the median income for Lee County. The SHIP program provides a deferred payment loan with no interest to eligible recipients to fund the gap between what the financial institution will lend and what the homebuyer can afford to pay for newly constructed single-family homes and existing homes within the City. Receivables for the City’s business-type activities, including individual major funds and allowances for uncollectible accounts, are as follows:

Receivables:Accounts, gross $ 8,534,339 $ 1,372,389 $ 440,446 $ 10,347,174

Less: Allowance for uncollectibles (1,783,476) (306,466) (134,883) (2,224,825) Accounts, net $ 6,750,863 $ 1,065,923 $ 305,563 $ 8,122,349

Fund

Wastewater

Water -

TotalFunds

Business-Type

Other

Fund

Solid Waste

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September 30, 2015

NOTE 7 – ASSETS HELD FOR RESALE

Community Redevelopment Agency The asset held for resale in the Community Redevelopment Agency (CRA) fund consists of the McCollum Hall property acquired by the CRA on May 13, 2008 to preserve the existing historical building and eventually sell the property to a private developer for further restoration and revitalization. The purchase by the CRA consisted of an upfront payment of $217,335 and twenty-four monthly payments totaling $165,165 at an interest rate of 6.000%. The carrying value of property held for resale at September 30, 2015 of $258,010, which approximates net realizable value. This amount reflects the value of the just and assessed property data according to Lee County Property Appraiser 2014 tax roll plus costs incurred for repairs and maintenance. The amount of the asset held for resale is offset by nonspendable fund balance in the CRA fund. After soliciting proposals, the Fort Myers Redevelopment Agency (FMRA) chose Urban Development Solutions, Inc. (UDS) based on the company’s history in Pinellas and Manatee Counties. They are a 501(c) 3 development firm dedicated to helping municipalities, non-profits, and private firms develop and finance commercial projects in underserved and low-income markets. On June 19, 2012, the FMRA and UDS signed a Development Agreement to preserve, renovate and revitalize McCollum Hall. UDS is seeking additional funds to replace the historic preservation tax credits funding portion of the capital stack. In July 2014, the CRA board approved the acceptance of a grant in the amount of $500,000 from the State of Florida, Department of State, Division of Historical Resources to be used exclusively for the exterior restoration of the McCollum Hall. Though the grant agreement was signed in November 2014, the effective date of the agreement began on July 1, 2014 and shall end on June 1, 2016. Community Development Block Grant The U.S. Department of Housing and Urban Development’s (HUD) Neighborhood Stabilization Program (NSP) is part of the national effort to restore homes and renew neighborhoods affected the hardest by the recent housing crisis. The NSP signals opportunity for homebuyers and stronger neighborhoods with reinvestments that go straight to the heart of the communities. In fiscal year 2009, the City was allocated $2,297,318 of Neighborhood Stabilization Program 1 (NSP1) funding, which was provided through HUD’s Community Development Block Grant (CDBG) Program under the Housing and Economic Recovery Act of 2008. In fiscal year 2011, the City received $1,537,642 from an NSP 3 funding allocation, which was released by HUD as authorized in the Dodd Frank Wall Street Reform and Consumer Protection Act to continue to assist state and local governments in the redevelopment of abandoned and foreclosed residential properties. The City is utilizing NSP funds in the following ways:

Purchase foreclosed and vacant single or multi-family residential properties in target areas, Improve property condition via rehabilitation, Incorporate energy saving features, Resell to households with income less than 120% AMI (Area Median Income) Provide housing assistance to households below 50% AMI, which includes affordable rental units, Offer financial aid in the form of a silent second mortgage and help with reasonable closing costs.

With the NSP 1 funds, the City set a benchmark to fund the acquisition and rehabilitation of approximately 25 housing units for households at or below 120 percent of area median income. The expected timeline for the City’s NSP 1 Plan was February 2009 through July 2013, and a rehabilitation project was considered complete upon transfer to an eligible homeowner or when the unit is rented to an eligible tenant. As of September 2015, the City held three rehabilitated single-family homes, which comprise new construction on foreclosed, city-owned property, as assets held for resale for a total of $261,000. Two properties are currently being rented while renters improve their credit scores and attain bank loans, and one is currently vacant, waiting on an approved purchaser.

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September 30, 2015

NOTE 7 – ASSETS HELD FOR RESALE (continued)

Community Development Block Grant (continued) The NSP 3 grant application contained more defined target areas than was required by the NSP1 grant notice. It is expected that the City will acquire, rehab and sell at least twelve housing units with NSP 3 funds. In fiscal year 2012, the City completed construction of five new single-family homes, and sold two of those homes in fiscal year 2013, two homes in fiscal year 2014, and one home in fiscal year 2015. Rehabilitation projects comprised three properties in fiscal year 2012 and three properties in fiscal year 2013. Of the six rehabilitated properties, the City sold one property in fiscal year 2013 and five properties in fiscal year 2014. In fiscal year 2015, the City built a single family home, which will be sold in the beginning of the next fiscal year. The City used program income to fund the construction costs. The City also earmarked $574,329 for the acquisition, rehabilitation, financing, and resale of multi-family rental properties. The rehabilitation of the units was completed in fiscal year 2014 and transferred to a local non-for-profit agency to provide rental assistance to households with incomes less than 50% AMI. During fiscal year 2009, one multi-family rental unit was purchased for $217,872 with NSP 1 funds and rehabilitated with the intent for resale. On September 17, 2012, City Council approved a Community Development Block Grant Neighborhood Stabilization Program Subrecipient Agreement with Goodwill Industries of Southwest Florida, Inc. for the property management of this unit. The agreement provides for Goodwill to receive clear title in 2027 if all obligations are fulfilled. In addition to other requirements, Goodwill must provide quarterly reports to the City through 2017 and yearly reporting for the remaining years of the Subrecipient Agreement. If Goodwill fails to meet the agreement guidelines, the property will revert back to the City. Based on agreement by both parties, a Quit Claim Deed was issued by the City on November 8, 2012 and filed with the Lee County Clerk of Circuit Court. NOTE 8 – CAPITAL ASSETS

Capital assets activity for the year ended September 30, 2015, was as follows:


Capital assets, not being depreciated:Land $ 25,385,341 $ - $ (30,900) $ 25,354,441 Antiques and Exhibits (1) 251,871 - - 251,871 Construction in progress 3,937,039 5,126,988 (224,301) 8,839,726 Intangibles-easements 3,560,054 977 - 3,561,031

Total capital assets, not being depreciated 33,134,305 5,127,965 (255,201) 38,007,069

Capital assets, being depreciated:Buildings 22,509,437 347,053 - 22,856,490Improvements 46,218,055 1,171,229 - 47,389,284Equipment 24,865,811 554,284 (569,538) 24,850,557Intangibles-software 145,587 - - 145,587Infrastructure 265,662,544 2,427,297 - 268,089,841

Total capital assets, being depreciated 359,401,434 4,499,863 (569,538) 363,331,759

Less accumulated depreciation for:Buildings (11,191,278) (664,129) - (11,855,407)Improvements (21,725,885) (2,624,800) - (24,350,685)Equipment (21,133,763) (1,016,485) 555,154 (21,595,094)Intangibles-software (128,683) (3,497) - (132,180)Infrastructure (189,771,863) (5,904,322) - (195,676,185)

Total accumulated depreciation (243,951,472) (10,213,233) 555,154 (253,609,551)

Total capital assets being depreciated, net 115,449,962 (5,713,370) (14,384) 109,722,208

Total governmental activities capital assets, net $ 148,584,267 $ (585,405) $ (269,585) $ 147,729,277

Retirements andTransfers Out

BeginningBalance

EndingBalance

Additions andTransfers In

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September 30, 2015

NOTE 8 – CAPITAL ASSETS (continued)

Depreciation expense was charged to functions/programs of the governmental activities of the primary government as follows: Governmental Activities:

General government $ 1,562,370 Public Safety:

Police 149,218 Fire 323,095 Protective inspections 24,409

Physical environment 874,840 Transportation 6,023,993 Economic environment 238,022 Culture and recreation 1,017,286

Total depreciation expense - governmental activities $ 10,213,233

EndingBalance

Business-Type Activities

Capital assets, not being depreciated:Land $ 3,788,143 $ - $ - $ 3,788,143Intangibles 187,410 93,860 - 281,270Construction in progress 1,087,163 4,263,376 (196,047) 5,154,492

Total capital assets, not being depreciated 5,062,716 4,357,236 (196,047) 9,223,905

Capital assets, being depreciated:Buildings 93,193,617 408,930 - 93,602,547Improvements other than buildings 32,024,613 495,674 (59,742) 32,460,545Equipment 22,131,440 5,701,619 (728,987) 27,104,072Utility Systems 398,360,497 13,550,719 - 411,911,216Antiques and Exhibits (1) 160,500 - - 160,500

Total capital assets, being depreciated 545,870,667 20,156,942 (788,729) 565,238,880

Less accumulated depreciation for:Buildings (59,047,381) (3,199,563) - (62,246,944)Improvements other than buildings (10,598,023) (1,107,828) - (11,705,851)Equipment (15,071,554) (2,251,028) 727,694 (16,594,888)Utility Systems (131,182,477) (10,832,938) - (142,015,415)Antiques and Exhibits (1) (160,500) - - (160,500)

Total accumulated depreciation (216,059,935) (17,391,357) 727,694 (232,723,598)

Total capital assets being depreciated, net 329,810,732 2,765,585 (61,035) 332,515,282

Total business-type activities capital assets, net $ 334,873,448 $ 7,122,821 $ (257,082) $ 341,739,187

(1) The City owns various collections of works of art, historical treasures, educational exhibits and similar assets that are housed in theImaginarium and Edison-Ford Estates. In compliance with the City’s Capital Asset Capitalization Policy, the City capitalizes the collections.

Beginning Additions and Retirements andBalance Transfers In Transfers Out

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September 30, 2015

NOTE 9 – ACCRUED LIABILITIES AND UNEARNED REVENUE

1. Accrued Liabilities Accrued liabilities at September 30, 2015 were as follows:

Governmental Activities:General Fund $ 4,350,202 $ 423,036 $ 313,815 $ 5,087,053 Revenue Bonds and Notes Fund - - 15,000 15,000 General Capital Projects - - 7,372 7,372 Nonmajor Governmental Funds - - 9,389 9,389 Internal Service Fund - - 112,309 112,309

Total Governmental Activities $ 4,350,202 $ 423,036 $ 457,885 $ 5,231,123

Business-type Activities:Water-Wastewater Fund $ - $ - $ 99,896 $ 99,896 Solid Waste Fund - - 6,491 6,491 Nonmajor Business-type Funds - - 60,404 60,404

Total Business-type Activities $ - $ - $ 166,791 $ 166,791

TotalSalaries and Due to Other

Benefits Fiduciary Funds Liabilities

2. Unearned Revenue As a result of implementing Governmental Accounting Standards Board Statement No. 65, Items Previously Reported as Assets and Liabilities, revenues previously recorded as deferred revenue in the governmental funds until both measurable and available are reported as deferred inflows of resources until such time the revenue becomes available. The governmental fund financial statements may also report unearned revenue from receivables for revenues that are not received within the availability period to liquidate liabilities for the current period. The components of unearned revenue as of September 30, 2015 are as follows:

Unearned revenues:Cemetery lots $ 24,731 $ - $ 24,731 Code Enforcement billings 412,468 - 412,468 Rental income 92,115 - 92,115 Special assessment 543 - 543 Grant receipts - 231,423 231,423

Total Unearned revenues $ 529,856 $ 231,423 $ 761,279

Total

NonmajorGeneral Governmental

Fund Funds

63


September 30, 2015 NOTE 10 – PENSION OBLIGATIONS

The City oversees three separate single-employer defined benefit plans: the General Employees’ Pension Plan that covers full-time City employees and civilian police department employees; the Police Officers’ Retirement System for non-civilian Police Department employees, and; the Firefighters’ Retirement System for City firefighters and Fire Department officers. Although an outside firm administers each plan, the plans are sponsored by and fiscally dependent on the City. A board of trustees governs each plan, with each board consisting of seven trustees. These plans are maintained as pension trust funds and included as part of the City’s reporting entity. City ordinance and state law require contributions be determined by actuarial studies at least every three years. Stand-alone financial reports are not issued. 1. General Employees’ Pension Plan Plan Description Plan administration. The General Employees’ Pension Plan (GEPP) provides retirement, termination, disability and death benefits to Plan members and their beneficiaries. Regular full-time employees enter on the first of the month coincident with or next following the date of employment. Certain positions are allowed to opt out of the Plan. The City Council has the authority to establish and amend the benefit provisions of the Plan. The GEPP Board of Trustees comprises the president of the employees’ association; a trustee appointed by the employees’ association; a non-union City employee that is a member of the retirement system, elected by the members of the retirement system that are non-union City employees; a trustee appointed by the City Council; the City Manager or his designee, and; a sixth and seventh trustee appointed by the other trustees. Plan membership. As of October 1, 2014, the GEPP Plan membership consisted of the following: Inactive plan members or beneficiaries currently receiving benefits 497 Inactive plan members entitled to but not yet receiving benefits 254 Active plan members 484 Total plan membership 1,235

Benefits provided. The GEPP provides retirement, termination, disability and death benefits to Plan members and their beneficiaries, as follows:

Normal retirement: Date of retirement is the first of month coincident with or next following the earlier of (1) the attainment of age 62 and the completion of five years of credited service, (2) the age when credited service plus age equals 80, or (3) 30 years of credited service, regardless of age. The benefit amount is 2.1% of the average final compensation multiplied by credited service prior to April 2, 1998 plus 3.0% of the average final compensation multiplied by credited service after April 2, 1998 through September 17, 2012, plus Rate A or B for service after September 17, 2012. Rate A is 1.8% and Rate B is 3.0%.

Early retirement: Date of retirement is the earlier of the attainment of age 55 and the completion of seven years of credited service, or age 60 and five years of credited service. The benefit amount is determined using the same calculations as for normal retirement and reduced by 4.0% for each year prior to normal retirement.

Termination of employment: Vested members (members with seven or more years of credited service) receive their accrued benefit payable at retirement age. Non-vested members (members with less than seven years of credit service) receive a return of their accumulated contributions.

Disability benefits: Total and permanent benefits, as determined by the Board, for eligible members that have at least five years of credited service. The benefit amount is determined using the same calculations as for normal retirement, based on total service and the average final compensation as of the date of disability.

Pre-retirement death benefits: Vested benefits are paid for ten years at the member’s normal (unreduced) or early (reduced) retirement date. Beneficiaries of non-vested members receive a return of their accumulated contributions.

64


September 30, 2015 NOTE 10 – PENSION OBLIGATIONS (continued)

1. General Employees’ Pension Plan (continued) Benefits provided (continued) Benefit terms provide for an annual 2.5% cost of living increase (COLA) for Tier 3 and Tier 4 members with at least three years of increased member contributions. The COLA is payable to normal and early retirees, in addition to disability retirees, vested terminated members, and joint pensioners and beneficiaries. Tier 2 and Tier 4 members receive a supplemental benefit of $200 per month, payable for the retiree’s lifetime only (not subject to the cost of living adjustments). Members must make additional contributions for a minimum of three years for this benefit. Contributions. Member contribution requirements are established by City Code Section 62-185, which may be amended by the City Council. Member contributions vary based on the rate and tier selected by the employee. The City is required to contribute, at an actuarially determined rate, the remaining amount required in order to pay current costs and amortize unfunded past service costs, if any, as provided in Chapter 112, Florida Statutes. Administrative costs of the GEPP are financed through Plan contributions and investment earnings.

Pension Plan Fiscal Year EndingAnnual Pension Cost

(APC)Percentage of APC

ContributedNet Pension Obligation

GEPP 9/30/2015 7,248,247$ 100% -$ 9/30/2014 6,801,604 100% - 9/30/2013 5,427,855 100% -

Three Year Trend Information

Investments. In fulfilling their fiduciary responsibility, the Pension Board of Trustees (the Board) for the GEPP established an Investment Policy Statement and directed that it apply to all assets under their control. Note 4, section 2, provides disclosure about the GEPP’s investment policy and related investments. Deferred Retirement Option Program (DROP). City employees are eligible for the Deferred Retirement Option Program (DROP) upon the satisfaction of normal retirement requirements. Participation in the DROP may not exceed sixty months. At the member’s election, the rate of return may be (1) the actual net rate of investment return (total return net of brokerage commissions, management fees and transaction costs) credited each fiscal quarter, or (2) 3.0% per annum compounded monthly. Members may elect to change the form of return one time. Participating members receive their distribution as a cash lump sum (options available) at the termination of employment. As of September 30, 2015, the balance of the DROP amounts maintained by the GEPP was $2,124,994. Net Pension Liability The GEPP’s net pension liability was measured as of September 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The components of the net pension liability of the GEPP at September 30, 2015 were as follows: Total pension liability 148,851,542$ Plan f iduciary net position (91,362,238) GEPP net pension liability 57,489,304$

Plan f iduciary net position as a percentageof the total pension liability 61.38%

65



1. General Employees’ Pension Plan (continued) Net Pension Liability (continued) Actuarial assumptions. The total pension liability was determined by an actuarial valuation as of October 1, 2014, updated to September 30, 2015, using the following actuarial assumptions applied to all periods included in the measurement: Inflation 3.0 percentSalary increases Service basedDiscount rate 7.75 percentInvestment rate of return 7.75 percent, net of pension plan investment expense,

including inflation Mortality rates were based on the RP-2000 Combined Healthy Table projected to valuation date for healthy lives and the RP-2000 Disabled Table for disabled lives. The actuarial assumptions used in the October 1, 2014 valuation were based on the results of an actuarial experience study for the period 2002 – 2012. The long-term expected rate of return on the GEPP 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 expenses 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. Best estimates of arithmetic real rates of return for each major asset class included in the GEPP’s target asset allocation as of September 30, 2015 are summarized in the following table:

Target Long-Term ExpectedAsset Class Allocation Real Rate of Return

Domestic Equity 45.0% 7.50%International Equity 15.0% 8.50%Broad Market Fixed Income 20.0% 2.50%Real Return Assets 5.0% 2.50%Global Fixed Income 5.0% 3.50%Real Estate 10.0% 4.50%

Total 100.0%

Note 4, section 2, provides further discussion of the GEPP’s asset allocation policy. Discount Rate. The discount rate used to measure the total pension liability was 7.75 percent. The projection of cash flows used to determine the discount rate assumed that Plan member contributions will be made at the current contribution rate and that City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the GEPP’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 the GEPP investments was applied to all periods of projected benefit payments to determine the total pension liability.

66



1. General Employees’ Pension Plan (continued)

Balances at September 30, 2014 $ 143,676,276 $ 90,622,674 $ 53,053,602

Changes for the year:

Service cost 2,461,949 - 2,461,949

Interest 11,016,448 - 11,016,448

Differences between expected and actual experience (675,391) - (675,391)

Contributions - employer - 7,248,247 (7,248,247)

Contributions - members 104,188 1,056,162 (951,974)

Net investment income - 311,772 (311,772)

Benefit payments, including refunds of employee contributions (7,731,928) (7,731,928) -

Administrative expense - (144,689) 144,689

Net changes 5,175,266 739,564 4,435,702


Net Pension

Liability Net Position Liability

(a) (b) (a)-(b)

Changes in Net Pension Liability

Increase (Decrease)

Total Pension Plan Fiduciary

Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability of the GEPP, calculated using the discount rate of 7.75 percent, as well as what the GEPP’s net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (6.75%) or 1 percentage point higher (8.75%) than the current rate:

GEPP net pension liability $ 73,682,729 57,489,304$ $ 43,813,024

1% Decrease Current Discount 1% Increase

(6.75%) Rate (7.75%) (8.75%)

Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended September 30, 2015, the GEPP recognized pension expense of $6,771,250. At September 30, 2015, GEPP reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Differences betw een expected and actual experience $ - $ 450,260

Net difference betw een projected and actual earnings on pension plan investments 5,362,959 -

Total $ 5,362,959 $ 450,260

Deferred Outflows Deferred Inflows

of Resources of Resources

67



1. General Employees’ Pension Plan (continued) Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (continued) Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year ended September 30:

2016 $ 1,340,739 (225,130)$

2017 1,340,740 (225,130)

2018 1,340,740 -

2019 1,340,740 -

2020 - -

Thereafter - -



2. Police Officers’ Retirement System Plan Description Plan administration. The Police Officers’ Retirement System (PORS) provides retirement, disability, death benefits and cost of living adjustments to Plan members and their beneficiaries. Each person employed by the City of Fort Myers Police Department becomes a member of the Plan as a condition of employment. Therefore, all police officers are eligible for all Plan benefits as provided for in the Plan document and by applicable law, except the Chief of Police. The Chief of Police may, within sixty days of becoming the Chief of Police, notify the Board and the City in writing of the election to not be a member of the PORS. The City Council has the authority to establish and amend the benefit provisions of the Plan. The PORS Board of Trustees comprises the City Manager or his designee; the Chief of Police of the City; three members of the retirement system that are elected by a majority of police officers that are members of the retirement system, and; two trustees that are legal residents of the City, appointed by the City Council upon nomination by the other five trustees. Plan membership. As of October 1, 2014, the PORS Plan membership consisted of the following: Inactive plan members or beneficiaries currently receiving benefits 148 Inactive plan members entitled to but not yet receiving benefits 8 Active plan members 167 Total plan membership 323

Benefits provided. The PORS provides retirement, termination, disability, and death benefits to Plan members and their beneficiaries, as follows:

Normal retirement: Date of retirement is the earlier of age 55 or the completion of twenty-five years of credited service, regardless of age. The benefit amount is 3.24% of the average final compensation multiplied by credited service for each year of credited service prior to March 17, 2014, plus 3.0% for each year of credited service for years after March 17, 2014. Supplemental benefits provide $150 per month that is payable for the lifetime of the retiree. Any member that has accrued at least fifteen years of credited service as of March 17, 2014 shall continue to be eligible for the $290 additional monthly benefit.

Early retirement: Date of retirement is the earlier of the attainment of age 45 and the completion of ten years of credited service, or the completion of fifteen years of credited service. The benefit amount is the accrued benefit, reduced 3.0% per year, plus the supplemental benefit.

68



2. Police Officers’ Retirement System (continued) Benefits provided (continued)

Termination of employment: Vested members (members with five or more years of credited service) receive

their accrued benefit payable at the member’s election, on the otherwise early or normal retirement date or refund of member contributions, with 3.75% interest. Non-vested members (members with less than five years of credited service) receive a refund of their member contributions, with 3.75% interest.

Disability benefits: Total and permanent benefits, as determined by the Board. Members are covered from the date of employment for service incurred disabilities and after five years of employment for non-service incurred disabilities. The benefit amount is 3.24% of the average final compensation multiplied by credited service for service earned prior to March 17, 2014, and 3% of the average final compensation multiplied by credited service for service earned on and after March 17, 2014 (but not less than 42% of average monthly earnings), plus the supplemental benefit, offset with workers’ compensation. Benefits commence upon Board approval and are payable until the earlier of recovery or death (120 monthly payments of the accrued benefit, less the supplemental benefit, are guaranteed).

Pre-retirement death benefits: For members with credited service, death benefits for spouse and/or dependent child are paid to the spouse as 1.62% of the average final compensation multiplied by credited service and to each child as 0.324% of the average final compensation multiplied by credited service. The overall maximum benefit to the spouse and children is 70% of the average final compensation. Pre-retirement death benefits for a member with no spouse and no children are paid by a refund of the member contributions, with 3.75% interest. There is an alternative benefit to the beneficiaries of members that decease after completing at least ten years of service. Those beneficiaries may elect to receive the member’s accrued benefit for ten years at the member’s normal (unreduced) or early (reduced) retirement date.

Benefit terms provide for a cost of living increase, as follows:

Members that retired after November 5, 1990 and prior to December 1, 2002 receive 3.0% at age 60 and each October 1 thereafter.

Members that retired after November 30, 2002 receive a 3.0% per year increase on the monthly benefit, beginning at the earlier of 24 months following normal retirement eligibility or age 60.

Members that retired after March 17, 2014 receive a blended rate: 3.0% for benefits accrued before March 17, 2014, and 1.5% per year for benefits accrued beginning March 17, 2014 and after.

Contributions. Member contribution requirements are established by City Code Section 62-75, which may be amended by the City Council. Members of the Plan are required to contribute 10% of their annual covered salary. The City is required to contribute, at an actuarially determined rate, the remaining amount required in order to pay current costs and amortized unfunded past service cost, if any, as provided in Chapter 112, Florida Statutes, less amounts received from the State of Florida for insurance surcharges on policies sold within the City. The State’s contribution to the PORS for fiscal year 2015 was $642,339. The City recognizes these on-behalf payments as revenues and expenditures in the governmental funds financial statements.




PORS (1) 9/30/2015 9,831,335$ 100% - 9/30/2014 10,605,960 100% - 9/30/2013 9,897,942 100% -


(1) The amounts include applicable premium tax refunds from the State of Florida that w ere passed through the City to the respectivetrust fund.

69



2. Police Officers’ Retirement System (continued) Investments. In fulfilling their fiduciary responsibility, the Pension Board of Trustees (the Board) for the PORS established an Investment Policy Statement and directed that it apply to those funds under their control. Note 4, section 2, provides disclosure about the PORS’ investment policy and related investments. Deferred Retirement Option Program (DROP). PORS employees are eligible for the Deferred Retirement Option Program (DROP) upon the satisfaction of normal retirement requirements. Participation in the DROP may not exceed sixty months. At the member’s election, the rate of return may be (1) the actual net rate of investment return (total return net of brokerage commissions, management fees and transaction costs) credited each fiscal quarter, or (2) 3.0% per annum compounded monthly. Members may elect to change the form of return one time. Participating members receive their distribution as a cash lump sum (options available) at the termination of employment. As of September 30, 2015, the balance of the DROP amounts maintained by the PORS was $1,533,476. Net Pension Liability The PORS’ net pension liability was measured as of September 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The components of the net pension liability of the PORS at September 30, 2015 were as follows: Total pension liability 160,318,030$ Plan f iduciary net position (97,064,559) PORS net pension liability 63,253,471$

Plan f iduciary net position as a percentageof the total pension liability 60.55% Actuarial assumptions. The total pension liability was determined by an actuarial valuation as of October 1, 2014, updated to September 30, 2015, using the following actuarial assumptions applied to all periods included in the measurement: Inflation 3.0 percentSalary increases 6.0 percentDiscount rate 8.00 percentInvestment rate of return 8.00 percent, net of pension plan investment expense,

including inflation Mortality rates were based on the RP-2000 Table with no projection. Disabled lives set forward five years. Based on other studies of municipal police officers, the assumption sufficiently accommodates future mortality improvements. The actuarial assumptions used in the October 1, 2014 valuation were based on the results of an actuarial experience study for the period 1987 – 2009. The long-term expected rate of return on the PORS 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 expenses 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. Best estimates of arithmetic real rates of return for each major asset class included in the PORS’ target asset allocation as of September 30, 2015 are summarized in the following table:

70



2. Police Officers’ Retirement System (continued) Net Pension Liability Actuarial assumptions (continued)


Domestic Large Cap Equities 32.5% 8.00%Convertible Securities 10.0% 6.40%Domestic Small / Mid Cap Equities 7.5% 8.00%Master Limited Partnerships 5.0% 5.00%

Foreign Securities 15.0% 3.00%Real Estate 5.0% 3.00%Fixed Income Securities 25.0% 4.40%

Total 100.0%

Note 4, section 2, provides further discussion of the PORS’ asset allocation policy. Discount Rate. The discount rate used to measure the total pension liability was 8.00 percent. The projection of cash flows used to determine the discount rate assumed that Plan member contributions will be made at the current contribution rate and that City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the PORS’ 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 the PORS investments was applied to all periods of projected benefit payments to determine the total pension liability.



Service cost 2,714,290 - 2,714,290

Interest 12,007,018 - 12,007,018

Change in excess state money (58,952) - (58,952)

Differences between expected and actual experience 2,118,502 - 2,118,502


Contributions - state - 642,339 (642,339)

Contributions - members 17,987 1,119,965 (1,101,978)

Net investment income - (861,763) 861,763



Net changes 8,783,673 2,004,264 6,779,409



Total Pension Plan Fiduciary Net Pension

Increase (Decrease)


(a) (b) (a)-(b)

71



2. Police Officers’ Retirement System (continued) Net Pension Liability (continued) Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability of the PORS, calculated using the discount rate of 8.00 percent, as well as what the PORS’ net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (7.00%) or 1 percentage point higher (9.00%) than the current rate:

PORS net pension liability $ 83,753,695 63,253,471$ $ 46,303,670

1% Decrease

(7.00%)

1% Increase

(9.00%)

Current Discount

Rate (8.00%)

Pension Expense and Deferred Outflows of Resources Related to Pensions For the year ended September 30, 2015, PORS recognized pension expense of $7,401,842. At September 30, 2015, PORS reported deferred outflows of resources related to pensions from the following sources:

Differences betw een expected and actual experience $ 1,694,801

Net difference betw een projected and actual earnings on pension plan investments 6,871,761

Total $ 8,566,562

of Resources

Deferred Outflows

Amounts reported as deferred outflows of resources related to pensions will be recognized in pension expense as follows:


2016 $ (2,141,642)

2017 (2,141,640)

2018 (2,141,640)

2019 (2,141,640)

2020 -

Thereafter - 3. Firefighters’ Retirement System Plan Description Plan Administration. The Firefighters’ Retirement System (FRS) provides retirement, termination, disability and death benefits to Plan members and their beneficiaries. The City Council has the authority to establish and amend the benefit provisions of the Plan. The FRS Board of Trustees comprises the City Manager or his designee; the Fire Chief of the City; three members of the retirement system that are elected by a majority of firefighters that are members of the retirement system, and; two trustees that are legal residents of the City, appointed by the City Council upon nomination by the other five trustees. On April 20, 2015, City Council adopted Ordinance No. 3740, which amended the Plan to comply with Senate Bill 1128 and to make benefit changes related to normal retirement dates and benefits; supplemental benefits; disability benefits; cost of living increases; and eligibility. As a result of these changes, the projected additional final year’s salary changed to an individual assumption as opposed to a flat 30%.

72



3. Firefighters’ Retirement System (continued) Plan Description (continued) The payroll growth assumption is limited to the 10 year historical payroll growth. A 1.27% payroll growth was used in calculating the unfunded actuarial accrued liability in the October 1, 2015 actuarial valuation. Plan membership. As of October 1, 2014, the FRS Plan membership consisted of the following: Inactive plan members or beneficiaries currently receiving benefits 94 Inactive plan members entitled to but not yet receiving benefits 13 Active plan members 119 Total plan membership 226

Benefits provided. The Firefighters’ Retirement System (FRS) provides retirement, termination, disability and death benefits to Plan members and their beneficiaries, as follows:

Normal retirement: Date of retirement is the earlier of (1) age 52, or (2) twenty-five years of credited service, regardless of age. The benefit amount is 3.11% of the average monthly earnings multiplied by credited service prior to April 20, 2015, plus 3% of average monthly earnings multiplied by credited service on or after April 20, 2015. Benefits from the FRS are reduced by amounts paid under the terminated Travelers contracts.

Early retirement: Date of retirement is attainable at age 45 and ten years of credited service. The benefit amount is the member’s accrued benefit, reduced 2% for each year prior to the normal retirement date. Benefits from the FRS are reduced by amounts paid under the terminated Travelers contracts.

Termination of employment: Vested members (members with ten years or more of credited service) receive their accrued benefit payable at the member’s election, at age 52 (unreduced) or as early as age 45 (reduced) or refund of their member contributions, with 3.75% interest. Non-vested members (members with less than ten years of credited service) receive a refund of their member contributions, with 3.75% interest.

Disability benefits: Total and permanent benefits, as determined by the Board, for eligible members that have ten years of credited service if the disability is not service-incurred. There is no service requirement for service-incurred disability benefits. The benefit amount for In-Line-of-Duty is the greater of the accrued benefit or 60% of the average monthly earnings. Line-of-duty retirees also receive the supplemental benefit listed above as well as the 3.0% cost of living increase beginning at age 60. The benefit amount for Not-In-Line-Of-Duty is the member’s accrued benefits. Benefits commence upon the Board’s approval and are payable on a ten year certain and life thereafter basis, or until recovery, if such recovery occurs prior to the normal retirement date.

Pre-retirement death benefits: The surviving spouse receives benefits that are the greater of the member’s early retirement benefit or 50% of the projected normal retirement benefit based on the average monthly earnings at the time of death. Each dependent child under the age of 21 receives 5% of the projected normal retirement benefit that was determined for the spouse. The minimum benefit is the member’s accrued benefit payable to the beneficiary for ten years. The spouse’s benefit ceases upon death; children’s benefit ceases on the earlier of death, attainment of age 21 or when no longer a dependent of the spouse. Death benefits are offset by amounts payable under terminated Travelers Contracts.

Benefit terms provide a cost of living increase, as follows:

Members who retire after June 1, 1986 and prior to January 1, 2005 (exclusive of any supplemental benefit) receive an increase of 3.0% in benefits beginning on the October 1 following age 60.

Members who retire on or after January 1, 2005 (exclusive of any supplemental benefit) receive an increase of 3.0% per year beginning on the October 1 that is at least twenty-four months following the retiree’s normal retirement date.

The adjustment for monthly benefits accrued on and after April 20, 2015 is 1.5%.

73



3. Firefighters’ Retirement System (continued) Benefits provided (continued) Service retirees (normal or early) receive a supplemental benefit of an additional $150 per month for life. Members with at least ten years of credited service as of April 20, 2015 shall receive $200 per month for life. Individual participant share accounts were established as of October 1, 2010 for all participants that are actively employed by the City on or after October 1, 2010. The accounts shall be credited with monies received pursuant to Chapter 175, Florida Statutes in excess of the 2009 base amount of $475,448, beginning with the Plan year ending September 30, 2010 (including all remaining funds in the Excess State Monies Reserve). On each valuation date, each account shall be adjusted to reflect the net earnings or losses during the year at the net of fees rate of return for the year unless the Board dedicates a separate investment portfolio for the Share Plan monies. Participating members receive their distribution as a cash lump sum at the termination of employment. Contributions. Member contribution requirements are established by City Code Section 62-135, which may be amended by the City Council. Members of the Plan are required to contribute 8% of their annual covered salary. The City is required to contribute, at actuarially determined rate, the remaining amount required in order to pay current costs and amortize the unfunded past service cost, if any, as provided in Chapter 112, Florida Statutes, less amounts received from the State of Florida for insurance surcharges on policies sold within the City. In no event will the City’s contributions be less than 10% of the payroll of the City of Fort Myers Fire Department for the fiscal year. The State’s contribution to the FRS for fiscal year 2015 was $841,430. The City recognizes these on-behalf payments as revenues and expenditures in the governmental funds financial statements.




FRS (1) 9/30/2015 5,313,630$ 100% - 9/30/2014 5,577,263 100% - 9/30/2013 5,444,898 100% -

(1) The amounts include applicable premium tax refunds from the State of Florida that w ere passed through the City to the respectivetrust fund.


Investments. In fulfilling their fiduciary responsibility, the Pension Board of Trustees (the Board) for the FRS established an Investment Policy Statement and directed that it apply to all assets under their control. Note 4, section 2, provides disclosure about the FRS’ investment policy and related investments. Deferred Retirement Option Program (DROP). FRS employees are eligible for the Deferred Retirement Option Program (DROP) upon the satisfaction of normal retirement requirements. Participation in the DROP may not exceed eighty-four months. At the member’s election, the rate of return may be (1) the actual net rate of investment return (total return net of brokerage commissions, management fees and transaction costs) credited each fiscal quarter, or (2) 3.0% per annum compounded monthly. Members may elect to change the form of return one time. Participating members receive their distribution as a cash lump sum (options available) at the termination of employment. As of September 30, 2015, the balance of the DROP amounts maintained by the FRS was $2,328,577. Net Pension Liability The FRS’ net pension liability was measured as of September 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The components of the net pension liability of the FRS at September 30, 2015 were as follows:

74



3. Firefighters’ Retirement System (continued) Net Pension Liability (continued) Total pension liability 111,158,218$ Plan f iduciary net position (72,739,278) FRS net pension liability 38,418,940$

Plan f iduciary net position as a percentageof the total pension liability 65.44% Actuarial assumptions. The total pension liability was determined by an actuarial valuation as of October 1, 2014, updated to September 30, 2015, using the following actuarial assumptions applied to all periods included in the measurement: Inflation 3.0 percentSalary increases 6.0 percentDiscount rate 8.00 percentInvestment rate of return 8.00 percent, net of pension plan investment expense,

including inflation Mortality rates were based on the RP-2000 Table with no projection. Disable lives set forward five years. Based on other studies of municipal firefighters, the assumption sufficiently accommodates future mortality improvements. The actuarial assumptions used in the October 1, 2014 valuation were based on the results of an actuarial experience study for the period 1987 – 2009. The long-term expected rate of return on the FRS 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 expenses 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. Best estimates of arithmetic real rates of return for each major asset class included in the FRS’ target asset allocation as of September 30, 2015 are summarized in the following table:


Domestic Equity 50.0% 7.50%International Equity 15.0% 8.50%Broad Market Fixed Income 17.0% 2.50%Global Fixed Income 5.0% 3.50%Alternatives 3.0% 2.50%Real Estate 10.0% 4.50%

Total 100.0%

Note 4, section 2, provides for further discussion of the FRS’ asset allocation. Discount Rate. The discount rate used to measure the total pension liability was 8.00 percent. The projection of cash flows used to determine the discount rate assumed that Plan member contributions will be made at the current contribution rate and that City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the FRS’ 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 the FRS’ investments was applied to all periods of projected benefit payments to determine the total pension liability.

75



3. Firefighters’ Retirement System (continued)



Service cost 1,986,264 - 1,986,264

Interest 8,383,338 - 8,383,338

Share plan allocation 435,503 - 435,503

Changes in benefit terms (1,250,890) - (1,250,890)

Differences between expected and actual experience (52,669) - (52,669)


Contributions - state - 841,430 (841,430)

Contributions - members 7,737 591,653 (583,916)

Net investment income - (485,367) 485,367



Net changes 4,560,505 828,826 3,731,679


Net Pension


(a) (b) (a)-(b)


Increase (Decrease)

Total Pension Plan Fiduciary

Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability of the FRS, calculated using the discount rate of 8.00 percent, as well as what the FRS’ net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (7.00%) or 1 percentage point higher (9.00%) than the current rate:

FRS net pension liability $ 51,372,602 38,418,940$ $ 27,671,229

1% Decrease Current Discount 1% Increase

(7.00%) Rate (8.00%) (9.00%)

Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended September 30, 2015, FRS recognized pension expense of $3,613,478. At September 30, 2015, FRS reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Differences betw een expected and actual experience $ - $ 42,136

Net dif ference betw een projected and actual earnings on pension plan investments 5,068,039 -

Total $ 5,068,039 $ 42,136



76



Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (continued) Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:


2016 $ 1,267,009 (21,068)$

2017 1,267,010 (21,068)

2018 1,267,010 -

2019 1,267,010 -

2020 - -

Thereafter - -



Retirement Plan for City Officials Electing Not to Participate in the Current Defined Benefit Plan Plan Description. On May 7, 2007, City Council passed Resolution No. 2007-26, which authorized the establishment of a governmental money purchase plan and trust for City officials, who comprise elected officials, the City Manager, Police Chief, Fire Chief, and City directors. On June 5, 2007, the City adopted the City of Fort Myers 401(a) Plan for City officials that elect not to participate in the City’s defined benefit plans. The deferred compensation amounts are not available for withdrawal by the participants until termination, retirement, death or unforeseeable emergency. The Plan is administered by an unrelated financial institution on behalf of the City. Contributions. For City officials that elect not to participate in the City’s defined benefit plans, the City shall contribute 12% of earnings for the Plan year and the participants are required to contribute 3% of their earnings. Contribution requirements for the City Manager and the Chief of Police are determined by their employment agreements. Currently, the City provides a retirement benefit equal to 15.3% of salary. No employee contribution or vesting period is required. As of September 30, 2015, the City Manager, one City Council member and the Chief of Police were the only participants in the 401(a) Plan and the total fiscal year 2015 contributions were $44,498.

77



ASSETSCash and cash equivalents $ 5,140,188 $ 2,740,331 $ 2,043,051 $ 9,923,570

Receivables

Employer contributions 3,744 9,188,996 4,907,703 14,100,443 Interest and dividends 106,977 222,174 99,748 428,899

Prepaid items - benefits - 683,192 398,132 1,081,324

Total receivables 110,721 10,094,362 5,405,583 15,610,666

Investments, at fair value

U.S. government and agency securities 1,352,066 10,789,471 2,489,024 14,630,561 Municipal bonds 908,526 - - 908,526 Corporate stock 35,681,973 20,413,981 34,801,116 90,897,070 Corporate stocks - ADR 888,884 - - 888,884 Corporate bonds 4,075,214 2,128,779 6,438,704 12,642,697 Convertible bonds - 6,598,317 - 6,598,317 Convertible preferred - 2,072,260 - 2,072,260 Mortgage backed securities 7,396,726 5,602,919 - 12,999,645 Asset backed securities 2,935,067 - 1,849,877 4,784,944 Mutual funds:

Fixed income 7,164,271 - 2,360,226 9,524,497 Equity - 15,911,308 - 15,911,308 International equity - 9,618,189 8,625,305 18,243,494

Commingled funds - Real estate - 9,295,805 - 9,295,805 Limited partnerships:

Real estate - - 8,829,697 8,829,697 International equity 11,091,155 - - 11,091,155

Master limited partnerships - 1,880,512 - 1,880,512 Private placements 90,748 - - 90,748 Real estate investment trusts 10,569,936 - - 10,569,936 International securities:

Bonds and notes 513,620 - - 513,620 Stocks 3,583,193 - - 3,583,193 Total investments 86,251,379 84,311,541 65,393,949 235,956,869

Total assets 91,502,288 97,146,234 72,842,583 261,491,105

LIABILITIES Payables:

Benefit payments 4,220 - - 4,220

Investment expenses 121,341 78,859 101,937 302,137

Administrative expenses 14,489 2,816 1,368 18,673

Total liabilities 140,050 81,675 103,305 325,030

NET POSITIONNet position restricted for pensions $ 91,362,238 $ 97,064,559 $ 72,739,278 $ 261,166,075

Firefighters'

RetirementTotal

Statement of Net Position - Pension Trust Funds

Pension Plan

Police Officers'

RetirementSystem

General

Employees'System

78



ADDITIONS

Contributions

Employer $ 7,248,247 $ 9,188,996 $ 4,907,703 $ 21,344,946

State of Florida - 642,339 841,430 1,483,769

Plan members 1,056,162 1,119,965 591,653 2,767,780

Total contributions 8,304,409 10,951,300 6,340,786 25,596,495

Investment income

Net depreciation in fair value

of investments (983,299) (2,571,249) (1,585,222) (5,139,770)

Interest and dividends 1,807,865 2,145,801 1,607,084 5,560,750

Total investment gains (losses) 824,566 (425,448) 21,862 420,980

Less: investment expenses 512,794 436,315 507,229 1,456,338

Net investment gain (losses) 311,772 (861,763) (485,367) (1,035,358)

Total additions 8,616,181 10,089,537 5,855,419 24,561,137

DEDUCTIONS

Benefits paid 7,731,928 8,015,172 4,948,778 20,695,878

Administrative expenses 144,689 70,101 77,815 292,605

Total deductions 7,876,617 8,085,273 5,026,593 20,988,483

Change in net position 739,564 2,004,264 828,826 3,572,654

NET POSITION

Net position held in trust for pension

benefits

Net position - beginning 90,622,674 95,060,295 71,910,452 257,593,421

Net position - ending $ 91,362,238 $ 97,064,559 $ 72,739,278 $ 261,166,075

Firefighters'

Retirement

System

Statement of Changes in Net Position - Pension Trust Funds

General

Employees'

Pension Plan

Police Officers'

Retirement

System Total

NOTE 11 – DEFERRED COMPENSATION PLAN

The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Service (IRS) Code Section 457. The plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death or the hardship distribution criteria as defined in IRS Code Section 457. Because the assets of the plan are held in trust and are the sole property of the participants, no balances or financial information relative to the plan is reported in the basic financial statements.

79


September 30, 2015

NOTE 12 – OTHER POSTEMPLOYMENT BENEFIT OBLIGATIONS

In addition to providing pension benefits, the City has a single-employer healthcare plan that allows retirees to purchase health, life, vision and dental benefits at the same rate as active employees, in accordance with state statutes. To be eligible for this benefit, the employee must retire from the City, have no break between his/her active employment and retirement, and be collecting pension benefits from one of the City’s three pension plans. The retirees pay all premiums for the coverage elected. In order to comply with the requirements of Governmental Accounting Standards Board Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other than Pensions, the City contracted with a certified actuarial firm to provide an actuarial valuation of postemployment benefits. The postemployment health insurance benefits will continue to be offered on a pay-as-you-go basis with the same premium subsidy rates that active employees receive. As required by the State of Florida Statute 112.0801(1), the claims experience of the retirees is co-mingled with that of active employees in determining the health plan cost. In accordance with GASB Statement No. 45, the co-mingling of claims requirement equates to an implicit subsidy to retirees that creates an OPEB liability on the part of the City. Therefore, the City has incurred a liability for the implicit rate subsidy as the City implemented GASB Statement No. 45. The City does not intend to fund the actuarial accrued liability. The City’s annual other postemployment benefit (OPEB) cost is calculated based on the annual required contribution (ARC) of the employer, an amount actuarially determined in accordance with the parameters of GASB 45. The calculation produced an unfunded obligation of $13,035,575 and an ARC as 6.1% of average projected payroll. The following table shows the components of the City’s OPEB cost for the year, the amount contributed to the plan, and changes in the City’s net OPEB obligation:

Annual required contribution (ARC) $ 2,218,108 Interest on net OPEB obligation 400,910 Adjustment to ARC (477,274 ) Annual OPEB cost 2,141,744 Contributions made (560,742) Increase in net OPEB obligation 1,581,002 Net OPEB obligation-beginning of year 11,454,573 Net OPEB obligation-end of year $ 13,035,575

The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for fiscal year 2015 and the two preceding years are as follows:

Year Ended

Annual

OPEB Cost

Percentage of OPEB Cost Contributed

Net OPEB Obligation

9/30/13 $ 2,023,299 29.18% $ 9,941,419 9/30/14 2,123,018 28.73% 11,454,573 9/30/15 2,141,744 26.18% 13,035,575

As of October 1, 2014, the most recent actuarial valuation date, the plan was zero percent funded. The actuarial accrued liability for benefits was $22,233,948, and the actuarial value of assets was zero, resulting in an unfunded actuarial accrued liability (UAAL) of $22,233,948. The covered payroll (annual payroll of active employees) was $36,489,021, and the ratio of the UAAL to the covered payroll was 60.93 percent. The schedule of funding progress, presented as Required Supplementary Information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets are increasing or decreasing over time relative to the actuarial accrued liability for benefits. A separate, publicly available postemployment benefit plan report is not prepared for the defined benefit plans.

80


September 30, 2015

NOTE 12 – OTHER POSTEMPLOYMENT BENEFIT OBLIGATIONS (continued)

Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. The information presented in the required supplementary schedule was determined as a part of the actuarial valuation at the date indicated: Valuation date 10/1/2014 Actuarial cost method Entry Age Amortization method Level percent, closed Remaining amortization period 24 years Asset valuation method Unfunded

Actuarial assumptions: Investment rate of return* 3.5% per year, compounded annually Projected salary increase* 6%-7% per year

Healthcare cost trend 0.0% initially 4.7% ultimately, in 2040 * Includes general price inflation at 2.5% NOTE 13 – COMMITMENTS

Construction Contracts The Water–Wastewater Fund had outstanding commitments of uncompleted construction contracts totaling $10,638,285. These projects relate primarily to neighborhood utility improvements, the lift station 44 rehabilitation, and electrical upgrades for the Central and South Advanced Wastewater Treatment Plants, and funding for these projects is pay-as-you-go. Other non-major enterprise funds had construction contract commitments totaling $1,200,919, primarily for a stormwater vactor truck, the Dean Park neighborhood Improvements, and Ford Street and Winkler canal improvements. The funding for these projects is provided by pay-as-you-go, federal grants and the Utility System Refunding Revenue Bonds, Series 2006. The Transportation Capital Projects Fund had outstanding commitments of $1,818,025, primarily for construction costs for the Hanson Street Extension – Cocos to Ortiz Avenue and citywide bridge repairs. The funding for these projects is provided by pay-as-you-go, road impact fees, the Utility System Refunding Revenue Bonds, Series 2006, and the Capital Improvement and Refunding Revenue Bonds, Series 2014A. The General Capital Projects Fund had commitments outstanding of $5,153,337, mainly for the construction of the new Fire Station 1 and administration building, and ADA compliance improvements. Funding for these projects is provided by fire impact fees, the Improvement and Refunding Revenue Bonds, Series 2006, and the Capital Improvement and Refunding Revenue Bonds, Series 2014A.

81


September 30, 2015

NOTE 13 – COMMITMENTS (continued)

Construction Contracts (continued) The remaining commitment amounts were encumbered at fiscal year end. As discussed in Note 1, 6., Budgetary information, Budgetary basis of accounting, the encumbrances and related appropriations lapse at the end of the fiscal year, but are re-appropriated and become part of the subsequent year’s budget because performance under the contract is expected in the next year. Encumbrances As discussed in Note 1, 6., Budgetary information, Budgetary basis of accounting, encumbrance accounting is used to the extent necessary to assure effective budgetary control and accountability and to facilitate effective cash planning and control. At year end, the amount of encumbrances expected to be honored upon performance by the vendor in the next year were as follows:

Transportation General OtherGeneral Capital Projects Capital Projects Governmental

Fund Fund Fund Funds Total

Encumbrances Outstanding 502,410$ 1,818,025$ 5,153,337$ 565,462$ 8,039,234$


General Capital Projects Fund – of this amount, $4,286,593 is restricted for the construction of the new Fire Station 1 and administration building. Road, Water, Wastewater and Fire Impact Fees Credits The City offers road, water and wastewater and fire impact fee credits to developers who construct or provide certain infrastructure improvements. Credits may be earned in special assessment districts, which are financed by the City, and residential and commercial projects. The credits may be used to offset future impact fees and have a standard life of twenty years for road and fire credits and ten years for water and wastewater from date of issuance, unless a longer period is specifically authorized by City Council. The developer who earned them may use the credits or the credits may be transferred to another party under certain circumstances. If the credits are not used within the authorized timeframe, they will expire. Chapter 122, Land Development Code allows the City to create water and sewer impact fee credits for capital improvements of utility mains. The credits are created when the construction is completed and accepted by the City for maintenance. The road impact fee credits include credits for land dedicated to the City. The City also participates with the Lee County Road Impact Fee Ordinance through an interlocal agreement. The Lee County Road Impact Fee Ordinance allows for the issuance of impact fee credits for land dedication for approved roads shown on the City’s transportation element of the Capital Improvement Program. As of September 30, 2015, there was approximately $16 million of total potential impact fee credits earned and outstanding.

Available Earned Water $ 70,319 $ 70,319 Sewer 21,517 21,517 Road 14,441,114 14,441,114 Fire 1,694,362 1,694,362 Total $ 16,227,312 $ 16,227,312

82


September 30, 2015 NOTE 14 – RISK MANAGEMENT

The City, including its component units, uses the Risk Management Internal Service Fund to account for and finance risks for workers’ compensation, general liability and property damage. The City self-insures its workers’ compensation exposure and purchases commercial excess coverage for workers’ compensation, which covers claims greater than $500,000. The City is self-insured for general liability risk in the amount of $200,000 per claim, which is in accordance with Florida Statute 768.28. The City purchased commercial excess coverage for general liability up to $2,000,000 per occurrence for claims that may exceed statutory limits. Commercial insurance is purchased to cover property damage and the coverage provides a loss limit of $20,000,000 all risk property coverage, with a $10,000,000 Named Windstorm sub-limit. Flood insurance through National Flood Insurance Program provides $8,989,200 in building coverage with $3,103,700 in coverage for personal property on scheduled structures. Settlements have not exceeded insurance coverage for the past twenty years. Additional coverage includes EMT Liability, Law Enforcement Liability, Public Officials’ Liability, Excess Auto Liability, Crime/Employee Dishonesty, and Statutory Death. The City of Fort Myers provides all eligible employees a group medical plan and group term life coverage equal to one times the annual salary rounded to the next higher thousand. In addition, the City makes a defined contribution of $200 per month per employee or pays 70% of the dependent medical coverage. The defined contribution may be applied to the cost of dependent medical, or; applied to the cost of any optional employee benefit, or; taken as taxable income. Premiums are charged by the City’s Risk Management Internal Service Fund to City departments and are available to pay claims, claim reserves and administrative costs of the program. Liabilities of the Risk Management fund are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported (IBNR). Claim liabilities are actuarially calculated considering the effects of inflation, recent claim settlement trends, including frequency and amount of payouts, and other economic and social factors, utilizing a 2% discount. The unpaid claim estimates and funding recommendations were developed by the actuary using the following methodology:

1. Estimate ultimate losses for all past fiscal accident periods and prospective fiscal accident periods by coverage, net of specific excess reinsurance, based on various actuarial projection methods.

2. Subtract cumulative paid losses from the ultimate loss estimates by accident period to determine the estimated reserves, net of specific excess coverage, as of September 30, 2015.

3. Determine funding indications by discounting both the estimated reserve by accident period and the prospective year estimated ultimate loss estimates to reflect investment income, and then adding a margin for adverse deviation.

The liability for the claims and judgments is reported as self-insurance claims payable in the Risk Management Internal Service Fund. Activity in the balances of claims liabilities for the years ending September 30, 2015 and 2014 is as follows:

2015 2014

Workers Compensation and General Liability:

Unpaid claims, beginning of the fiscal year 6,798,126$ 5,453,373$

Claims incurred, including IBNRs 3,296,098 3,596,915

Claim payments (3,203,903) (2,252,162) Unpaid claims, end of the fiscal year 6,890,321$ 6,798,126$

83


September 30, 2015

NOTE 15 – LONG-TERM LIABILITIES

Arbitrage The bonds and notes in Governmental and Business-type Activities are subject to arbitrage. The arbitrage rebate requirement requires issuers of tax exempt debt to rebate to the U.S. Treasury investment income arising from proceeds of tax exempt debt to the extent that such income results from an investment yield in excess of the bond yield. There is no arbitrage liability as of September 30, 2015. Bonds and notes outstanding at September 30, 2015 consist of the following for governmental activities:

Governmental Activities Sale DateOriginal

Borrowing

Interest Rates to Maturity

Final Maturity

Outstanding September 30,

2015

Maximum Annual Debt

Service

Revenue BondsCity of Gulf Breeze, Florida Local Governmental Loan Program 10/1/1999 10,420,000$ 5.56% 12/1/2015 1,700,000$ 1,747,175$ Improvement and Refunding Revenue Bonds 12/21/2006 58,195,000 4.00% - 5.00% 12/1/2036 37,580,000 4,722,506 Improvement Refunding Revenue Bonds 9/14/2007 33,743,640 5.00% 12/1/2022 20,462,190 3,315,741 Capital Improvement and Refunding Revenue Bonds 6/19/2014 37,120,000 2.00% - 5.00% 12/1/2034 35,275,000 3,771,138 Taxable Capital Improvement Refunding Revenue Bonds 6/19/2014 2,790,000 2.00% - 5.00% 12/1/2019 2,740,000 578,984

Total Revenue Bonds 97,757,190 14,135,544

Revenue NoteCommunity Redevelopment Revenue Note 1/6/2005 7,450,000 4.01% 1/1/2022 3,473,077 637,359

Total Revenue Note 3,473,077 637,359

Installment Note 6/15/2015 320,172 1.02% 1/30/2019 320,172 105,000

Total for Governmental Activities 101,550,439$ 14,877,903$

(1) Interest is set on an index of 3 month LIBOR plus 20 basis points as published in the Wall Street Journal. As of September 30, 2015, the 3 month LIBOR w as 0.32500. Pledged Revenues The City pledged revenues, which comprise the Utilities Tax, Franchise Taxes, Communications Services Tax, Guaranteed Entitlement Funds, Occupational License Tax, Sales Tax, Five Cents Local Gas Tax, Six Cents Local Gas Tax and tax increment financing revenues as the sources of repayment for the following debt issues. Pledged revenues received in 2015 totaled $32,741,039. Governmental Unit Note (Gulf Breeze Loan Pool) refunded the outstanding Taxable Improvement Revenue Bonds, Series 1992B; Taxable Capital Improvement Revenue Bonds, Series 1998A; Taxable Capital Improvement Revenue Bonds, Series 1998B. The note is payable through December 1, 2015, with total principal and interest remaining to be paid of $1,747,175. Principal and interest paid for the current fiscal year totaled $1,753,763, which is 5.36% of total fiscal year 2015 pledged revenues. Community Redevelopment Revenue Note, Series 2005, was issued to finance the cost of community redevelopment projects and to refund certain outstanding obligations of the City. The note is payable through January 1, 2022, with total principal and interest remaining to be paid of $4,038,338. Principal and interest paid for the current fiscal year totaled $657,531, which is 2.01% of total fiscal year 2015 pledged revenues. Improvement and Refunding Revenue Bonds, Series 2006, were issued to provide funds to finance various capital improvements within the City and advance refund a portion of the outstanding Improvement Revenue Bonds, Series 2001A. Proceeds from the Capital Improvement and Refunding Revenue Bonds, Series 2014A, refunded $18,320,000 of the outstanding principal balance. The bonds are payable through December 1, 2036, with total principal and interest remaining to be paid of $63,175,381. Principal and interest paid for the current fiscal year totaled $2,267,669, which is 6.93% of total 2015 pledged revenues.

84


September 30, 2015

NOTE 15 – LONG-TERM LIABILITIES (continued)

Pledged Revenues (continued) Improvement Revenue Refunding Bonds, Series 2007, refunded a portion of the outstanding Improvement Refunding Revenue Bonds, Series 1997A. The bonds are payable through December 1, 2022, with total principal and interest remaining to be paid of $25,178,750. Principal and interest paid for the current fiscal year totaled $3,403,875, which is 10.40% of total fiscal year 2015 pledged revenues. Bonds and notes outstanding at September 30, 2015 consist of the following for business-type activities:

Business-type Activities Sale DateOriginal

Borrowing

Interest Rates to Maturity

Final Maturity

Outstanding September 30,

2015

Maximum Annual Debt

Service

Water-Wastewater:

Revenue BondsUtility System Refunding Revenue Bonds - includes a 8/1/1993 48,920,000$ 3.75% - 5.85% 10/1/2019 11,620,000$ 3,081,889$

capital appreciation seriesUtility System Refunding Revenue Bonds 4/10/2006 38,925,000 4.00% - 5.75% 10/1/2036 37,310,000 5,229,975 Utility System Refunding and Revenue Bonds 12/29/2011 68,605,000 2.00% - 5.00% 10/1/2041 64,990,000 6,993,513 Utility System Refunding Revenue Bonds 9/12/2012 17,025,000 2.00% - 4.00% 10/1/2033 14,225,000 2,257,649

Total Revenue Bonds 128,145,000 17,563,026

Loans and Revenue NoteState of Florida Revolving Fund Loans 100,684,185 2.31% - 3.16% 68,580,908 919,452 Utility System Revenue Note 11/5/2008 50,000,000 5.06% 10/1/2028 48,327,211 6,585,477

Total Loans and Revenue Note 116,908,119 7,504,929

Total for Water-Wastewater 245,053,119 25,067,955

Solid Waste:

Revenue BondsImprovement Refunding Revenue Bonds 9/4/2007 478,584$ 5.00% 12/1/2022 290,215$ 47,027$

Total for Solid Waste 290,215 47,027

Fort Myers Country Club:

Revenue BondsImprovement Refunding Revenue Bonds 9/4/2007 457,776$ 5.00% 12/1/2022 277,596$ 44,982$

Total for Fort Myers Country Club 277,596 44,982

Yacht Basin:

Revenue NoteCapital Improvement Revenue Note 10/4/2005 5,000,000$ 4.63% 9/1/2028 3,748,043$ 386,877$

Total for Yacht Basin 3,748,043 386,877

Total for Business-type Activities 249,368,973$ 25,546,841$

The business-type outstanding debt consists of Revenue Bonds and Notes for the Water-Wastewater Fund, the Solid Waste Fund, and for the non-major funds for the Fort Myers Country Club and Yacht Basin. These Revenue Bonds and Notes are obligations of the City and are payable solely from the operations of the Utility System, net of specified operating expenses.

85


September 30, 2015


Changes in governmental long term debt for the year ended September 30, 2015 are summarized as follows:

Revenue bonds payable $ 104,570,225 $ - $ 6,813,035 $ 97,757,190 $ 7,029,930

Unamortized premium 4,043,975 - 298,674 3,745,301 -

Net revenue bonds payable 108,614,200 - 7,111,709 101,502,491 7,029,930

Notes payable 3,994,230 320,172 521,153 3,793,249 517,788

Capital leases 701,868 - 198,043 503,825 164,541

Net pension liability 120,832,439 (1) 12,991,829 - 133,824,268 -

Due to private sources - 6,000,000 - 6,000,000 3,000,000

Compensated absences 3,835,758 225,220 452,385 3,608,593 1,611,229

Other postemployment benefits 8,638,821 1,194,966 - 9,833,787 -

Claims and judgments 6,798,126 294,243 202,048 6,890,321 3,370,709 Governmental-type Totals $ 253,415,442 (1) $ 21,026,430 $ 8,485,338 $ 265,956,534 $ 15,694,197

Due Within

One Year

Beginning

Balances Additions Reductions

Ending

Balances

(1) Restated, as noted in Note 24 The amount that is due to private sources relates to certain buyback provisions in two Developer Agreements that became effective on January 10, 2014. Certain events transpired that reduced the Developer’s value of total impact fee credits and the City must buy back 70% of those credits. The maximum annual buyback amount is $3.0 million and the remaining annual payments are due from the City to the Developer on the anniversary date of the first payment, July 9, 2014. Insufficient information existed in prior fiscal years to reasonably determine the exact amount due to the Developer. Analysis of the remaining impact fee credits at the end of the current fiscal year determined it is reasonable to accrue the next two annual buyback amounts of $3.0 million each. As a result, the City recorded a liability of $6.0 million in the government-wide financial statements as of September 30, 2015 to recognize the liability for the third annual payment due in July 2016 and the fourth annual payment due in July 2017. The City continues to monitor the balance of the Developer’s impact fee credits as certain economic conditions, such as increasing development within the City, will affect the final payment due in July 2018. Changes in business-type long term debt for the year ended September 30, 2015 are summarized as follows:

Water-Wastewater Utility FundRevenue bonds payable $ 132,164,287 $ - $ 5,256,555 $ 126,907,732 (1) $ 5,980,000

Unamortized premium and

defeasance costs 4,332,568 - 80,275 4,252,293 -

Net revenue bonds payable 136,496,855 - 5,336,830 131,160,025 5,980,000

State Revolving Loan 73,161,811 - 4,580,903 68,580,908 4,700,971

Revenue Note, Series 2008A 48,912,259 - 585,048 48,327,211 622,348

Net pension liability 11,236,408 (2) 939,453 - 12,175,861 -

Due to private sources 2,832,963 - - 2,832,963 -

Compensated absences 373,603 47,278 37,230 383,651 89,812

Other postemployment benefits 1,346,856 181,215 - 1,528,071 -

Fund totals 274,360,755 (2) 1,167,946 10,540,011 264,988,690 11,393,131

Beginning Ending Due Within

One YearBalances Additions Reductions Balances

(1) Difference betw een the $126,907,732 and $128,145,000 show n on the "Amount Outstanding" schedule is due to the 1993A capital appreciationbonds. The difference of $1,237,268 is compounded interest on those bonds.(2) Restated, as noted in Note 24 The amount that is due to private sources relates to the City’s formation of a public/private partnership for the permitting, design and development of a mixed-use development project within city limits. The City selected a local private entity to participate in the public/private partnership and the purchase agreement became effective May 18,

86


September 30, 2015


Business-type long term debt (continued) 2004. Phase Two of the purchase agreement pertains to land to be purchased by the private entity to be developed as a mixed use commercial/residential development. An amendment to the agreement provided for the design and management of the construction of a new clubhouse for Eastwood Golf Course, with the total cost to be used as a credit toward the future land purchases for development. The private entity completed the construction of the clubhouse in fiscal year 2009. The land related to the agreement is an asset in the Water-Wastewater Utility Fund. Due to the collapse of the local real estate market, the land purchases have not taken place.

Solid Waste FundRevenue bonds payable 321,886 - 31,671 290,215 33,258

Unamortized premium 18,096 - 2,194 15,902 -

Net revenue bonds payable 339,982 - 33,865 306,117 33,258



Other postemployment benefits 435,901 59,052 - 494,953 -

Fund totals 4,740,696 (1) 384,079 62,788 5,061,987 53,499

Other Enterprise FundsRevenue bonds payable 307,890 - 30,294 277,596 31,812

Unamortized premium 17,310 - 2,098 15,212 -

Net revenue bonds payable 325,200 - 32,392 292,808 31,812

Note payable 3,952,959 - 204,916 3,748,043 214,219

Capital leases - 585,515 76,455 509,060 115,604



Other postemployment benefits 1,032,995 145,769 - 1,178,764 -

Fund totals 13,991,549 (1) 1,469,791 354,152 15,107,188 498,645

Business-type totals $ 293,093,000 (1) $ 3,021,816 $ 10,956,951 $ 285,157,865 $ 11,945,275

Beginning Ending Due Within

One Year


Balances Additions Reductions Balances

Annual debt service requirements to maturity for general revenue bonds and notes are as follows:

Fiscal Year

2016 $ 7,029,930 $ 3,966,114 $ 517,788 $ 144,571 $ 7,547,718 $ 4,110,685

2017 5,501,825 3,725,594 593,009 124,510 6,094,834 3,850,104

2018 5,733,180 3,502,330 593,996 103,018 6,327,176 3,605,348

2019 5,979,535 3,253,045 599,994 81,848 6,579,529 3,334,893

2020 4,650,755 3,021,706 496,154 60,516 5,146,909 3,082,222

2021-2025 18,811,965 12,288,971 992,308 60,627 19,804,273 12,349,598

2026-2030 18,445,000 8,473,884 - - 18,445,000 8,473,884

2031-2035 22,570,000 4,506,117 - - 22,570,000 4,506,117

2036 and thereafter 9,035,000 392,551 - - 9,035,000 392,551

Total 97,757,190 $ 43,130,312 3,793,249 $ 575,090 $ 101,550,439 $ 43,705,402

Current portion (7,029,930) (517,788) (7,547,718)

Unamortized premium 3,745,301 - 3,745,301

Long term portion $ 94,472,561 $ 3,275,461 $ 97,748,022


Revenue Bonds Notes Total Governmental Activities

InterestInterestPrincipalInterestPrincipal Principal

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September 30, 2015


Annual debt service requirements to maturity for business-type revenue bonds, loans and notes are as follows:

Fiscal Year

2016 $ 5,980,000 $ 5,628,634 $ 5,323,319 $ 4,181,454 $ 33,258 $ 13,679

2017 7,865,000 5,354,373 5,478,321 4,025,931 34,845 11,977

2018 8,045,000 5,040,782 5,633,900 3,865,624 36,708 10,188

2019 8,230,000 4,688,810 5,801,988 3,700,282 38,571 8,306

2020 7,190,000 4,346,489 5,964,319 3,529,818 40,503 6,329

2021-2025 30,005,000 17,829,053 52,625,805 12,459,235 106,330 6,774

2026-2030 12,350,000 12,503,819 36,080,467 2,564,160 - -

2031-2035 27,040,000 8,208,400 - - - -

2036 and thereafter 21,440,000 2,347,200 - - - -

Total 128,145,000 $ 65,947,560 116,908,119 $ 34,326,504 290,215 $ 57,253

(5,980,000) (5,323,319) (33,258)

Unamortized premium and

defeasance costs 4,252,293 - 15,902

Long-term portion $ 126,417,293 $ 111,584,800 $ 272,859

InterestPrincipal InterestPrincipal

Current portion

Interest


Water-Wastewater Revenue Bonds Water-Wastewater Loans and Notes Solid Waste Revenue Bonds

Principal

Fiscal Year2016 $ 31,812 $ 13,085 $ 214,219 $ 172,657 $ 11,582,608 $ 10,009,509 2017 33,330 11,456 224,940 161,936 13,636,436 9,565,673 2018 35,112 9,745 235,687 151,190 13,986,407 9,077,529 2019 36,894 7,945 246,947 139,929 14,354,400 8,545,272 2020 38,742 6,054 258,382 128,495 13,491,946 8,017,185 2021-2025 101,706 6,480 1,491,076 443,308 84,329,917 30,744,850 2026-2030 - - 1,076,792 83,839 49,507,259 15,151,818 2031-2035 - - - - 27,040,000 8,208,400 2036 and thereafter - - - - 21,440,000 2,347,200 Total 277,596 $ 54,765 3,748,043 $ 1,281,354 249,368,973 $ 101,667,436

Current portion (31,812) (214,219) (11,582,608) Unamortized premium and

defeasance costs 15,212 - 4,283,407 Long-term portion $ 260,996 $ 3,533,824 $ 242,069,772

Principal Interest

Nonmajor Enterprise Fund Nonmajor Enterprise Fund

InterestPrincipalPrincipal Interest

Revenue Bonds Revenue Note Total Business-Type Activities

Capital Lease Obligations In fiscal year 2013, the City entered into two lease agreements as a lessee for financing the acquisition of certain capital assets for the City’s Fire Department valued at a total of $588,572. The lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the inception dates. In fiscal year 2014, the City entered into a lease agreement to finance the purchase of an upgrade to the Police Department’s information management software system. The lease agreement qualifies as a capital lease for accounting purposes, and therefore, was recorded at the present value of the future minimum lease payments as of the inception date. The City’s Information Technology Services Department in the Internal Services Fund provides the funding for the software installment payments and annual maintenance while the Police Department in the City’s General Fund receives the benefit of the software asset. Therefore, the asset acquired through the capital lease is reported in governmental-wide activities and the capital lease liability is reported in the Internal Services Funds’ activities.

88


September 30, 2015


Capital Lease Obligations (continued) This fiscal year, the City entered into three lease agreements to finance the purchases of mowing equipment that was essential to maintain the City’s two golf courses. All of the equipment has an estimated lifespan of 6 to 8 years and this year, $78,068 was included in depreciation expense. The lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the inception dates. The future minimum lease obligation and the net present value of these minimum lease payments, as reported in the respective activities, are as follows:

Internal Service FundYear ending September 30 Fire Engine Software - Fire Software - Police Total Required

2016 86,417$ 10,050$ 78,574$ 175,041$

2017 86,417 10,050 - 96,467

2018 86,417 - - 86,417

2019 86,417 - - 86,417

2020 86,417 - - 86,417

Total minimum lease payments 432,085 20,100 78,574 530,759

Less: amount representing interest (30,028) (415) (374) (30,817) Present value of minimum lease payments 402,057$ 19,685$ 78,200$ 499,942$


Eastwood Golf CourseYear ending September 30 Sprayers, mowers Mowers Sprayer, mowers Total Required

2016 71,351$ 28,715$ 34,924$ 134,990$

2017 71,351 28,715 34,924 134,990

2018 71,351 28,715 34,924 134,990

2019 71,351 9,572 34,924 115,847

2020 23,781 - 11,642 35,423

Total minimum lease payments 309,185 95,717 151,338 556,240

Less: amount representing interest (27,611) (6,614) (12,955) (47,180) Present value of minimum lease payments 281,574$ 89,103$ 138,383$ 509,060$

Depreciation expense for fiscal year 2015 42,876 14,111 21,081

Fort Myers Country Club


89


September 30, 2015

NOTE 16 – PRIOR YEAR DEFEASED DEBT AND ADVANCE / CURRENT REFUNDING

Prior year defeasance of debt In prior years, the City defeased certain general obligation revenue bonds by placing the proceeds of the new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liabilities for the defeased bonds are not included in the City’s financial statements. On September 30, 2015, $27,110,000 of the defeased bonds remained outstanding.


Florida Municipal Loan Council Governmental Note, Series 2005C 2,660,000$

Gas Tax Revenue Bonds, Series 2004 6,130,000

Improvement and Refunding Revenue Bonds, Series 2006 18,320,000

Total for Governmental Activities 27,110,000$

NOTE 17 – FUND BALANCE

Minimum Fund Balance/Net Position Policy The City adopted a fund balance policy on September 26, 2011 to ensure the maintenance of adequate fund balance / net position and reserves in the City’s various operating funds to provide the capacity to: 1) provide sufficient cash flow for daily financial needs, 2) secure and maintain investment grade bond ratings, 3) offset significant economic downturns and revenue shortfalls, and 4) provide funds for unforeseen expenditures related to emergencies. General Fund – The City will strive to maintain a minimum unassigned fund balance of 10% with a target of 10% - 17% of the total general fund budget. For the purposes of the calculation, the current fiscal year budget shall be the budget as originally adopted by resolution on or before September 30th for the subsequent fiscal year. The drawdown of unassigned fund balance may be utilized to respond and provide relief and recovery to emergencies which include, but are not limited to:

Hurricanes or tropical storms Flooding Wildfires Terrorist activity

Replenishment of Deficiencies – In the event that unassigned fund balance in the General Fund is used for unanticipated expenditures or emergencies, and subsequently causes the balance to fall below the minimum of 10%, the fund balance should be replenished in order to prepare for future events. The City will strive to replenish the fund balance within a one year period from the time the event occurs or as quickly as economic conditions allow. Other Governmental Funds – The various other governmental funds of the City have vastly differing objectives, cash flows and revenue patterns. As a result, no one level of reserves is appropriate for them all. Therefore, the appropriate level of fund balance in the other governmental funds will be determined on a case-by-case basis due to the specific needs of the fund. The City Manager, Director of Finance, or other designee shall determine this level. Enterprise Funds – The City will strive to maintain unrestricted net position equal to 20% of the budgeted annual operating expenditures for the current year in the Water-Wastewater Operating Fund and Solid Waste Fund to provide approximately a two month cushion for operating expenses. For the purposes of the calculation, the current fiscal year budget shall be the budget as originally adopted by resolution on or before September 30th for the subsequent fiscal year. The reserve is needed to cover short-term cash flow variations, economic downturns and emergencies. Unrestricted net position under the 20% goal should be used only for unanticipated expenditures. The various other enterprise and internal service funds of the City have vastly differing objectives, cash flows and revenue

90


September 30, 2015

NOTE 17 – FUND BALANCE

Minimum Fund Balance/Net Position Policy (continued) patterns. As a result, no one level of reserves is appropriate for them all. Therefore, the appropriate level of net position in all enterprise and internal service funds, other than the Water-Wastewater Operating Fund and the Solid Waste Fund, will be determined on a case-by-case basis due to the specific needs of the fund. The City Manager, Director of Finance, or other designee shall determine this level. NOTE 18 – INTERFUND RECEIVABLES AND PAYABLES

The composition of interfund balances as of September 30, 2015 is as follows: Due to/from other funds

Receivable Fund Payable Fund Amount

General Fund Nonmajor Governmental Funds $ 134,384

Nonmajor Enterprise Funds 780,061

Total due to General Fund $ 914,445

The receivable amount in the General Fund from nonmajor governmental funds and nonmajor enterprise funds relates to interim end of year funding. The General Fund expects to collect the balances in the subsequent year. Advances to/from other funds

Receivable Fund Payable Fund Amount

General Fund Nonmajor Governmental Funds $ 617,000

The amount payable to the General Fund by the Nonmajor Governmental Funds comprises advances to the Dr. Martin Luther King, Jr. Boulevard Redevelopment and Cleveland Avenue Redevelopment TIF Districts. None of the balance is scheduled to be collected in the subsequent year.

91


September 30, 2015

NOTE 19 – INTERFUND TRANSFERS

Transfers Out:

General Fund (1) $ - $ 8,529,807 $ 95,673 $ 224,933

Transportation Capital Projects (2) - 1,675,800 - -

General Capital Projects Funds (2) - - 1,667,067 -

Nonmajor Governmental Funds (3) 10,000 - 70,426 135,034

Water-Wastewater Fund (4) 6,588,300 - - -

Solid Waste Fund (4) 4,754,200 - - -

Internal Service Fund (5) 1,158,600 82,353 - -

Nonmajor Business-type Funds (6) 514,500 178,610 - 52,689

Total Transfers $ 13,025,600 $ 10,466,570 $ 1,833,166 $ 412,656

Transfers Out:

General Fund (1) $ 2,348,132 $ 2,518,173 $ 13,716,718

Transportation Capital Projects (2) - - 1,675,800

General Capital Projects Funds (2) - 445,209 2,112,276

Nonmajor Governmental Funds (3) - - 215,460

Water-Wastewater Fund (4) - - 6,588,300

Solid Waste Fund (4) - - 4,754,200

Internal Service Fund (5) - 76,767 1,317,720

Nonmajor Business-type Funds (6) - 190,600 936,399 Total Transfers $ 2,348,132 $ 3,230,749 $ 31,316,873

Transfers In:

Transfers In:

Total TransfersFunds Funds

Capital Projects Capital Projects

Nonmajor Nonmajor

General Fund and Notes Fund Fund Fund

Governmental Business-type

Transportation GeneralRevenue Bonds

(1) Transfers from the General Fund were used to fund debt service needs, capital improvements and grant matching. The transfers to Revenue Bonds and Notes include $7,172,276 for General Parity sinking fund deposits. The transfers to the Nonmajor Governmental Funds include $2,190,268 for tax increment funding. Transfers to the Nonmajor Business-type Funds relate to subsidies for the Yacht Basin, Harborside Event Center, Skatium and Department of Cultural and Historic Affairs enterprise funds.

(2) Transfers from the two major Capital Projects Funds were used for funding debt service and capital projects, respectively. Transfers to the Nonmajor Business-type Funds relate to Stormwater and Department of Cultural and Historic Affairs capital projects.

(3) Transfers from Nonmajor Governmental Funds funded capital project needs. (4) Transfers from the Water-Wastewater Utility Fund and Solid Waste Fund were used to contribute to General Fund

operations. (5) Transfers from the Internal Service Fund were used to contribute to operations of the General Fund, to fund debt

service needs, and to transfer an insurance reimbursement to the Imaginarium for capital expenses. (6) Transfers from the Nonmajor Business-type funds were used to contribute to General Fund operations, to fund debt

service needs and to fund the Parking Garage and Downtown Detention Basin repairs capital projects. The transfer between the Nonmajor Business-type funds relates to funding from the Eastwood Golf Course operations to the Fort Myers Country Club operations.

92


September 30, 2015 NOTE 20 – REDEVELOPMENT TRUST FUND

Pursuant to Florida Statute 163.387, the schedule below provides a summary of the sources and amounts of deposits into, and the amount and purpose of withdrawals from, the Redevelopment Trust Fund (Community Redevelopment Agency Fund) for the fiscal year ended September 30, 2015.

Deposits Withdrawals

Sources of deposits:

Tax increment revenue $ 3,226,153 $ -

Charges for services 8,039 -

Interest and Investment Income 9,548 -

Reimbursement of legal retainer fees 5,119

Purpose of w ithdraw als:

Personnel services - 674,442

Professional services - 292,199

Contract services - 62,145

Utilities - 75,559

Rentals and leases - 155,287

ITS service charges and capital recovery - 40,900

Insurance - 29,000

Repairs and maintenance - 47,353

Printing and binding - 4,791

Advertising - 28,219

Public relations - 2,020

Public relations, special events - 253,100

Tax increment rebates - 981,858

Taxes and assessments - 487

General administrative expense - 135,300

Office supplies - 6,898

Travel and transportation - 4,159

Communication 100

Freight and postage - 1,091

Equipment - 24,360

Dues and subscriptions - 8,289

Debt service, principal payments - 496,154

Debt service, interest payments - 161,377

Funding for capital projects and equipment - 138,245

Totals $ 3,248,859 $ 3,623,334

NOTE 21 – RELATED ORGANIZATION TRANSACTIONS

The Housing Authority of the City of Fort Myers is considered a related organization. A related organization is one for which the primary government (The City of Fort Myers appoints a voting majority of the board but does not exercise financial control) is not financially accountable. During the fiscal year that ended September 30, 2015, the City received $81,478 from the Housing Authority for providing additional police protection.

93


September 30, 2015 NOTE 22 – CONSTRUCTION PROJECT INTEREST COSTS

In accordance with Statement of Financial Accounting Standards (SFAS) No. 34, Capitalization of Interest Cost, and No. 62, Capitalization of Interest Costs in Situations Involving Certain Tax-Exempt Borrowings and Certain Gifts and Grants, the City capitalizes construction in progress interest costs in the Water-Wastewater Utility, Solid Waste, and Yacht Basin funds. For fiscal year ended September 30, 2015, total interest expense was $9,838,580, of which $259,574 was capitalized in the Water-Wastewater Utility fund. NOTE 23 – CONTINGENCIES

Grants The City participates in various federal and state grant programs, the principal of which are subject to program compliance audits pursuant to the Single Audit Act as amended. Accordingly, the City’s compliance with applicable grant requirements will be established at a future date. The amount of expenditures that may be disallowed by the granting agencies cannot be determined at this time. City management anticipates such amounts, if any, will be immaterial. Litigation, Claims and Assessments There are several pending claims and lawsuits arising from the normal course of business in which the City is involved. Estimated liabilities related to most unsettled claims have been accrued under the City’s self-insurance program, and management believes the self-insurance reserves recorded in the Risk Management Fund are adequate to cover losses for which the City may be liable. Although the outcome of these lawsuits and pending claims are not presently determinable, the City’s attorneys are not aware of any such claims against the City that would have a material effect on the basic financial statements or the adequacy of the appropriate reserves on deposit in the Risk Management Fund. NOTE 24 – PRIOR PERIOD ADJUSTMENTS

New Accounting Pronouncement For fiscal year ended September 30, 2015, the City implemented Governmental Accounting Standards Board Statement No. 68, Accounting and Financial Reporting for Pensions. The scope of this Statement addresses accounting and financial reporting for pensions that are provided to the employees of state and local governmental employers through pension plans that are administered through trusts that have the following characteristics:

Contributions from employers and nonemployer contributing entities to the pension plan and earnings on those contributions are irrevocable.

Pension plan assets are dedicated to providing pensions to plan members in accordance with the benefit terms.

Pension plan assets are legally protected from the creditors of employers, nonemployer contributing entities, and the pension plan administrator. If the plan is a defined benefit pension plan, plan assets also are legally protected from creditors of the plan members.

The new pronouncement required the restatement of the September 30, 2014 net position in governmental activities, business-type activities, enterprise and internal service funds. Due to the absence of personnel expenses, exceptions to the restatement comprise the Downtown Parking Garages enterprise fund and the Public Works Warehouse Operations internal service fund. The following tables present the details of the restatements:

94


September 30, 2015 NOTE 24 – PRIOR PERIOD ADJUSTMENTS (continued)

New Accounting Pronouncement (continued)

Governmental Business-type

Activities Activities Total

Net position, September 30, 2014 as previously reported 110,653,352$ 143,963,530$ 254,616,882$

Cumulative effect of the implementation of GASB 68 (120,832,439) (23,382,486) (144,214,925)

Adjustment to accrue customer reimbursements - (287,857) (287,857)

Net position, September 30, 2014 as restated (10,179,087)$ 120,293,187$ 110,114,100$

Primary Government

Water-Wastewater Solid Waste Total

Net position, September 30, 2014 as previously reported 93,903,922$ 9,645,862$ 103,549,784$

Cumulative effect of the implementation of GASB 68 (11,236,408) (3,825,014) (15,061,422)

Adjustment to accrue customer reimbursements - (287,857) (287,857) Net position, September 30, 2014 as restated 82,667,514$ 5,532,991$ 88,200,505$

Building Permits and Inspections Stormwater


Eastwood Golf Course Yacht Basin

Net position, September 30, 2014 as previously reported 5,783,353$ 14,789,425$ 5,645,788$ 3,955,326$ 1,484,168$

Cumulative effect of the implementation of GASB 68 (2,916,675) (1,660,529) (285,958) (731,585) (555,585) Net position, September 30, 2014 as restated 2,866,678$ 13,128,896$ 5,359,830$ 3,223,741$ 928,583$

Harborside Event Center Skatium

Dept of Cultural and Historic

Affairs TotalNet position, September 30, 2014 as previously reported 3,231,209$ (83,496)$ 1,547,639$ 36,353,412$

Cumulative effect of the implementation of GASB 68 (1,020,430) (440,338) (709,964) (8,321,064) Net position, September 30, 2014 as restated 2,210,779$ (523,834)$ 837,675$ 28,032,348$

Information

Central Technology Risk

Garage Services Management TotalNet position, September 30, 2014 as previously reported 1,224,659$ 468,956$ 7,515,763$ 9,209,378$

Cumulative effect of the implementation of GASB 68 (1,469,707) (2,665,792) (214,694) (4,350,193) Net position, September 30, 2014 as restated (245,048)$ (2,196,836)$ 7,301,069$ 4,859,185$


Nonmajor Enterprise Funds

Nonmajor Enterprise Funds (continued)

Major Enterprise Funds

Solid Waste Accrual During the current year, the Solid Waste division of Public Works recorded an accrual related to an overcharge of tipping fees passed through to the City’s customers. The accrual represented an accumulation of revenues related to the past two fiscal years. As a result, it was necessary to restate the Solid Waste net position in the business-type funds. The schedule below presents the impact of the restatement. Net position, September 30, 2014, as previously reported $ 9,645,862 Cumulative effect of the implementation of GASB 68 ( 3,825,014) Adjustment to accrue customer reimbursements ( 287,857) Restated as of September 30, 2014 $ 5,532,991

95

Required Supplementary Information Other than Management’s Discussion & Analysis

97

Budgeted AmountsOriginal Final

REVENUESTaxes $ 56,534,900 $ 58,018,669 $ 58,571,143 $ 552,474 Permits and fees 4,910,300 5,040,800 4,050,470 (990,330) Intergovernmental revenue 6,900,500 6,900,500 7,355,221 454,721 Charges for services 6,044,900 6,048,175 6,004,477 (43,698) Fines and forfeitures 656,700 656,700 518,404 (138,296) Miscellaneous 216,200 1,504,090 1,093,237 (410,853) Contributions - private source 2,500 24,220 29,970 5,750

Total revenues 75,266,000 78,193,154 77,622,922 (570,232)


General Government -Council - Mayor Pro Tem 7,200 7,700 7,681 19 Council - Ward I 83,700 83,700 82,431 1,269 Council - Ward 2 91,200 91,200 87,960 3,240 Council - Ward 3 83,200 83,200 64,941 18,259 Council - Ward 4 81,100 81,100 73,639 7,461 Council - Ward 5 82,800 82,800 76,156 6,644 Council - Ward 6 86,500 86,500 77,772 8,728 Council - Mayor 130,900 130,900 124,202 6,698 City Manager 720,800 668,942 668,816 126 Legal 1,010,300 1,010,300 983,650 26,650 City Clerk 1,330,800 1,224,230 1,089,622 134,608 Facilities Management 1,750,800 1,728,002 1,643,471 84,531 Financial Services 2,903,200 2,685,000 2,634,769 50,231 Human Resources 1,121,200 1,029,083 916,094 112,989 Real Estate 424,400 429,975 429,907 68 Community Development 858,400 892,037 812,003 80,034 Contributions 351,700 313,500 313,500 - General Contingencies (1,480,000) (1,402,368) - (1,402,368) Insurance 260,100 263,500 263,363 137

Total General Government 9,898,300 9,489,301 10,349,977 (860,676)

Public Safety -Police 35,368,469 36,791,599 36,819,506 (27,907) Fire 18,131,400 19,389,509 19,389,454 55 Protective Inspections 1,590,100 1,716,625 1,625,700 90,925

Total Public Safety 55,089,969 57,897,733 57,834,660 63,073

Transportation -Public Works 476,800 475,070 441,450 33,620 Insurance 9,000 9,000 9,000 -

Total Transportation 485,800 484,070 450,450 33,620

Physical Environment - Public Works 6,014,900 6,239,759 5,968,175 271,584

Culture and Recreation -Public Works 2,451,200 2,441,200 2,417,021 24,179 Contributions 153,000 153,000 153,000 - Special Events 141,500 141,500 131,315 10,185 Arts and Culture 145,000 145,000 144,910 90

Total Culture and Recreation 2,890,700 2,880,700 2,846,246 34,454

Total Current 74,379,669 76,991,563 77,449,508 (457,945)

Total expenditures 74,379,669 76,991,563 77,449,508 (457,945)

Excess of revenues over expenditures 886,331 1,201,591 173,414 (1,028,177)

OTHER FINANCING SOURCES (USES)Transfers in 13,015,600 13,015,600 13,015,600 - Transfers out:

Debt service transfers out (8,912,100) (8,549,915) (8,529,807) 20,108 Capital funding transfers out (171,500) (740,304) (320,606) 419,698 General transfers out (4,818,331) (4,926,972) (4,897,905) 29,067

Total transfers out (13,901,931) (14,217,191) (13,748,318) 468,873

Total other financing sources and uses (886,331) (1,201,591) (732,718) 468,873

Net change in fund balances - - (559,304) (559,304) Fund balances - beginning 13,977,578 13,977,578 13,977,578 - Fund balances - ending $ 13,977,578 $ 13,977,578 $ 13,418,274 $ (559,304)

Variance withFinal Budget(Budgetary Basis)

Actual Amounts

CITY OF FORT MYERS, FLORIDASchedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual

General FundFor the Year Ended September 30, 2015

98

Note 1 - BUDGETARY REPORTING

A. Reconciliation of Budgetary Basis Reporting Differences

Fund Balance - actual on a budgetary basis $ 13,418,274

Perspective Differences:Beautification 46,870Business Development Center 117,591Cemetery Maintenance 722,199Land Acquisition 372,677Off Duty Pay 115,290Submerged Land Lease 76,451

Fund balance - actual on a GAAP basis on governmental fund financial statements $ 14,869,352

GeneralFund

The following table presents a reconciliation of General Fund fund balance perspective differences on a budgetarybasis to the fund balances shown on a GAAP basis on the governmental fund financial statements at September 30,2015.

The Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual (Budgetary Basis) -General Fund presents comparisons of the legally adopted budget with actual data on a budgetary basis.Governmental funds applied to develop data on a budgetary basis differ from those presented in the governmentalfund financial statement due to the implementation of GASB 54. The following describes the major differencesbetween budgetary financial data and the governmental fund financials.

Perspective differences - Certain funds not included in the General Fund's annual budget but which are presentedin the General Fund for purposes of the governmental financial statements.

CITY OF FORT MYERS, FLORIDANotes to Required Supplementary Information


99

9/30/2015 9/30/2014

Total pension liability

Service cost 2,461,949$ 2,711,680$

Interest 11,016,448 10,590,158

Differences between expected and actual experience (675,391) -

Contributions - members 104,188 -

Benefit payments, including refunds of member contributions (7,731,928) (7,122,160)

Net change in total pension liability 5,175,266 6,179,678

Total pension liability - beginning 143,676,276 137,496,598

Total pension liability - ending (a) 148,851,542$ 143,676,276$

Plan fiduciary net position

Contributions - employer 7,248,247$ 6,801,604$

Contributions - members 1,056,162 966,498

Net investment income 311,772 6,801,741


Administrative expense (144,689) (147,068)

Net change in plan fiduciary net position 739,564 7,300,615

Plan fiduciary net position - beginning 90,622,674 83,322,059

Plan fiduciary net position - ending (b) 91,362,238$ 90,622,674$

Net pension liability - ending (a) - (b) 57,489,304$ 53,053,602$

Plan fiduciary net position as a percentage of the total pension liability 61.38% 63.07%

Covered employee payroll (1)22,278,817$ 20,480,978$

Net pension liability as a percentage of covered employee payroll 258.04% 259.04%

Notes to schedule

Changes in assumptions.

General Employees' Pension Plan

Note: The City of Fort Myers implemented GASB Statement 67 in fiscal year 2014. Therefore, information is presented for the years for whichinformation is available.

CITY OF FORT MYERS, FLORIDAEmployees' Pension Plans

Schedule of Changes in Net Pension Liability and Related Ratios

Last Two Fiscal Years

In the October 1, 2014 valuation, the Board adopted a change in the investment return assumption from 7.9% to 7.75% net of fees. In addition,the payroll growth assumption utilized in amortizing the Unfunded Actuarial Accrued Liability changed from 1.4% for fiscal year 2013 to 0.0% forfiscal year 2014.

(1) For fiscal year 2014, the covered employee payroll was based on pensionable salary.

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9/30/2015 9/30/2014

Actuarially determined contribution 7,248,247$ 6,801,604$

Contributions in relation to the actuarially determined contributions 7,248,247 6,801,604

Contribution deficiency (excess) -$ -$


Contributions as a percentage of covered employee payroll 32.53% 33.21%

Actuarial cost method Entry age normal

Amortization method Level percentage of payroll, closed

Remaining amortization period 30 Years (as of 10/1/2013 valuation)

Asset valuation method

Inflation 3.0% per year

Salary increases Credited Service: Increase:

0 - 2 Years 10.0%

3 - 5 Years 5.0%

6 - 15 Years 4.5%

More than 15 Years 5.0%

Prior fiscal year: flat 6.0% per year assumption.

Investment rate of return

Payroll growth Up to 5% per year; 1.4% used for 10/1/2013 valuation.

Cost of living adjustment (COLA)

Retirement age

Early retirement

Mortality

Termination and Disability Rate Tables % Terminating % Becoming disabled

Age during the year during the year

20 27.8% 0.07%

30 24.2% 0.11%

40 13.2% 0.19%

50 6.0% 0.51%

60 6.0% 1.66%

RP-2000 Combined Healthy Table with no projection. Disabled lives set forward 5years.

Projected salary at retirement is increased by expected lump sum sick and vacationpayouts for each member to account for non-regular compensation.

7.9% (previously 8.0%) per year, compounded annually, net of investment relatedexpenses.

2.5% per year for normal and early retirees, beginning one year after retirement. COLAis for Tier 3 and Tier 4 members only.

Earlier of age 62 with five years of service, or thirty years of service, regardless of age,or the age when service plus age equals 82, but no earlier than one year after thevaluation date.

Commencing with the earliest early retirement age (age 55 with seven years of service,or age 60 with five years of service), members are assumed to retire with an immediatesubsidized benefit at the rate of 5% per year.

Methods and assumptions used in calculations of actuarially determined contributions. The actuarially determined contributionrates in the schedule of the City's contributions are calculated as of October 1, two years prior to the end of the fiscal year in whichcontributions are reported. The following actuarial methods and assumptions were used to determine contribution rates reported in theschedule:

Notes to Required Supplementary Information for the Year Ended September 30, 2015

(1) For fiscal year 2014, Covered employee payroll was based on pensionable salary.

Each year, the prior Actuarial Value of Assets is brought forward utilizing the historicalgeometric 4-year average market value return. It is possible that, over time, thistechnique will produce an insignificant bias above or below market value.

CITY OF FORT MYERS, FLORIDAEmployees' Pension PlansSchedule of Contributions

General Employees' Pension Plan

Note: The City of Fort Myers implemented GASB Statement 67 in fiscal year 2014. Therefore, information is presented for the years forwhich information is available.


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9/30/2015 9/30/2014


Service cost 2,714,290$ 2,525,438$

Interest 12,007,018 11,505,764

Change in excess state money (58,952) -

Differences between expected and actual experience 2,118,502 -








Contributions - state 642,339 595,183

Contributions - members 1,119,965 1,135,542

Net investment income (loss) (861,763) 7,615,309



Net change in plan fiduciary net position 2,004,264 11,436,366







Notes to schedule

Benefit changes.

In fiscal year 2014, benefit terms were changed in the adoption of Ordinance 3701, as follows:

1). Benefit changes required by Senate Bill 1128:a.Salary is limited to 300 hours of overtime per calendar year, beginning with the effective date of the ordinance.

b.

2). Benefit changes not related to Senate Bill 1128:a.The multiplier for service on and after the effective date shall be 3.0% for each year of the credited service.

b.

Police Officers' Retirement System

For members with less than fifteen years of credited service as of the effective date and all future hires, the monthly supplemental benefit shall be$150. Members with fifteen years or more of credited service will retain the $290 monthly supplement.

(1) The covered employee payroll figures were not available. For fiscal year 2015, pensionable salary, including DROP, is reported.




Salary shall exclude payments for accrued unused sick or annual leave, provided, however, accrued leave as of the effective date and attributableto service earned prior to the effective date may still be included in salary for pension purposes. At retirement, salary will include the lesser of theamount of sick or annual leave accrued on the effective date or the actual amount for which the retiree receives payment , regardless of whetherthe amount of sick or annual leave was, at some point, prior to retirement reduced below the amount on the effective date.

102

Notes to schedule (continued)

Benefit changes (continued)

2). Benefit changes not related to Senate Bill 1128 (continued)c.


ii. The future accrual is based on the average final compensation at retirement multiplied by the service after the effective date multiplied by the3.0% benefit multiplier.

In the October 1, 2014 valuation, the final salary load assumption was changed from a flat 30% to one determined individually based on the hoursaccrued to date provided by the City. This change accounts for the change in definition of Salary. Additionally, the payroll growth assumption waslowered from 4.08% to 3.71%, as required by Florida Statutes.




Schedule of Changes in Net Pension Liability and Related Ratios (continued)


The annual cost-of-living increase to the monthly benefits for benefits accrued prior to the effective date will remain at 3.0% and the cost-of-livingincrease for benefits accrued after the effective date is 1.5%. For actuarial calculations, a blended rate was computed by using the ratio of thecurrent accrual (through the effective date) to the total accrual at retirement for the 3.0% cost-of-living adjustment and future accruals (after theeffective date) to total accrual at retirement for the 1.5% cost-of-living adjustment.

i. The current actuarial is based on average final compensation at retirement multiplied by the service through the effective date multiplied by the3.24 benefit multiplier.

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Contribution deficiency (excess) -$ -$








Salary increases




Retirement age

Early retirement

Mortality



20 11.3% 0.05%

30 8.7% 0.06%

40 5.6% 0.12%

50 1.3% 0.43%





Each year, the prior Actuarial Value of Assets is brought forward utilizing thehistorical geometric 4-year average market value return. It is possible that,over time, this technique will produce an insignificant bias above or belowmarket value.

6.0% per year until the assumed retirement age. Projected salary atretirement is increased to account for non-regular compensation. Thisincrease is based on each individual's hours accrued to date, as provided bythe City.


Methods and assumptions used in calculations of actuarially determined contributions. The actuarially determined contributionrates in the schedule of the City's contributions are calculated as of October 1, one year prior to the end of the fiscal year in whichcontributions are reported. The following actuarial methods and assumptions were used to determine contribution rates reported in theschedule:


Payments on the cost-of-living increase vary, based on retirement date. SeeNote 10 for specific disclosure.

Commencing with attainment of early retirement status, members areassumed to retire with an immediate subsidized benefit at the rate of 5% peryear.

RP-2000 Table with no projection. Based on a study of other public safetyfunds, this table reflects a 10% margin for future mortality improvements.Disable lives set forward five years.

Earlier of age 55 or the completion of twenty-five years of credited service,regardless of age. Also, any member that has reached normal retirement ageis assumed to continue employment for one additional year.

8.0% per year, compounded annually, net of investment-related expenses.

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Service cost 1,986,264$ 2,070,654$

Interest 8,383,338 8,024,792

Share plan allocation 435,503 417,144

Changes of benefit terms (1,250,890) -

Differences between expected and actual experience (52,669) -


Benefit payments, including refunds of members contributions (4,948,778) (4,331,258)






Contributions - state 841,430 823,071

Contributions - members 591,653 624,354

Net investment income (loss) (485,367) 6,281,680

Benefit payments, including refunds of members contributions (4,948,778) (4,331,258)


Net change in plan fiduciary net position 828,826 8,480,414







Notes to schedule

Benefit changes.

In fiscal year 2015, benefit terms were changed in the adoption of Ordinance 3740 on April 20, 2015, as follows:

1). Benefit changes required by Senate Bill 1128:a.Salary is limited to 300 hours of overtime per calendar year, beginning with the effective date of the ordinance.

b.

2). Benefit changes not related to Senate Bill 1128:a.The Fire Chief may opt out of the Plan within 60 days of appointment as Fire Chief.

b.




Salary shall exclude payments for accrued unused sick or annual leave, provided, however, accrued leave as of the effective date and attributableto service earned prior to the effective date may still be included in salary for pension purposes. At retirement, salary will include the lesser of theamount of sick or annual leave accrued on the effective date or the actual amount for which the retiree receives payment, regardless of whetherthe amount of sick or annual leave was, at some point, prior to retirement reduced below the amount on the effective date.


Firefighters' Retirement System

Members hired after the effective date shall have a normal retirement date of the earlier of 1) age 55 with 10 years of credited service, or 2) 25years of credited service.

105

Notes to schedule (continued)

Benefit changes. (continued)

2). Benefit changes not related to Senate Bill 1128 (continued)c.

d.

e.


As a result of the benefit changes in fiscal year 2015, the projected additional final years' salary changed from a flat 30% to an individual assumption.


For members with less than ten years of credited service as of the effective date and all future hires, the monthly supplemental benefit shall be$150. Members with ten years or more of credited service will retain the $200 monthly supplement.

The payroll growth assumption is limited to the 10 year historical payroll growth. In the October 1, 2014 valuation, a 4.42% payroll growth was used incalculating the unfunded actuarial accrued liability. A 1.27% payroll growth was used in the October 1, 2015 valuation.


Schedule of Changes in Net Pension Liability and Related Ratios (continued)Firefighters' Retirement System

The annual cost-of-living increase to the monthly benefits for benefits accrued prior to the effective date will remain at 3.0% and the cost-of-livingincrease for benefits accrued after the effective date is 1.5%. For actuarial calculations, a blended rate was computed by using the ratio of thecurrent accrual (through the effective date) to the total accrual at retirement for the 3.0% cost-of-living adjustment and future accruals (after theeffective date) to total accrual at retirement for the 1.5% cost-of-living adjustment.


The multiplier for service on and after the effective date shall be 3.0% for each year of the credited service. Members who reach normalretirement on the effective date are not subject to the reduction.

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Contribution deficiency (excess) (435,503)$ (2) -$








Salary increases




Retirement age

Early retirement

Mortality



20 9.3% 0.14%

30 7.9% 0.18%

40 4.3% 0.30%

50 1.1% 1.00%

(2) The excess contributions result from the fiscal year 2015 Share Plan allocation.

Earlier of age 52 or the completion of twenty-five years of credited service,regardless of age. Also, any member that has reached normal retirement ageis assumed to continue employment for one additional year.

Commencing with attainment of early retirement status, members areassumed to retire with an immediate subsidized benefit at the rate of 5% peryear.

RP-2000 Table with no projection. Based on a study of other public safetyfunds, this table reflects a 10% margin for future mortality improvements.Disable lives set forward five years.


Methods and assumptions used in calculations of actuarially determined contributions. The actuarially determined contributionrates in the schedule of the City's contributions are calculated as of October 1, one year prior to the end of the fiscal year in whichcontributions are reported. The following actuarial methods and assumptions were used to determine contribution rates reported in theschedule:

Each year, the prior Actuarial Value of Assets is brought forward utilizing thehistorical geometric 4-year average market value return. It is possible that,over time, this technique will produce an insignificant bias above or belowmarket value.

6.0% per year until the assumed retirement age. Projected salary atretirement is increased individually to account for non-regular compensation(previously 30%.)

8.0% per year, compounded annually, net of investment-related expenses.

Payments on the cost-of-living increase vary, based on retirement date. SeeNote 10 for specific disclosure.




Firefighter' Retirement SystemLast Two Fiscal Years

107

Annual money-weighted rate of return, net of investment expense for the pension plans:

General Employees' Police Officers' Firefighters'

For the year ended September 30, Pension Plan Retirement System Retirement System

2015 0.36% -0.98% -0.78%

2014 8.22% 9.75% 10.36%

2013 13.09% 11.52% 13.70%

2012 16.23% 16.70% 17.70%

2011 -1.23% -2.26% 1.17%

2010 8.84% 7.59% 8.44%

2009 0.12% 1.48% -1.25%

2008 -15.90% -15.90% -14.96%

2007 15.53% 14.26% 12.63%

2006 7.85% 6.55% 7.27%


Schedule of Investment ReturnsLast 10 Fiscal Years

108

Actuarial Accrued Unfunded Actuarial UAAL

Actuarial Liability Accrued Liability Funded Annual Covered as a % of

Valuation (Entry Age) (UAAL) Ratio Payroll Covered Payroll

Date (b) (b-a) (a/b) (c) ((b-a)/c)

10/01/14 $ - 22,233,948$ 22,233,948$ 0.00% 36,489,021$ 60.9%

10/01/12 - 20,978,235 20,978,235 0.00% 35,623,010 58.9%

10/01/10 - 21,285,518 21,285,518 0.00% 39,836,951 53.4%

10/01/08 - 16,271,673 16,271,673 0.00% 40,053,162 40.6%

10/01/07 - 22,351,815 22,351,815 0.00% 49,879,048 44.8%

of Assets

(a)

CITY OF FORT MYERS, FLORIDAOther Postemployment Benefits Plan


Schedule of Funding Progress

Actuarial Value

109

Combining Statements

and Schedules

CITY OF FORT MYERS

Major Governmental Funds

Debt Service Fund Revenue Bonds and Notes – To account for the accumulation of resources and the payment of principal and interest related to the City’s Governmental Unit Note (Loan from the City of Gulf Breeze, Florida Local Government Loan Program, Series 1985B); Improvement and Refunding Revenue Bonds, Series 2006; Improvement Refunding Revenue Bonds, Series 2007; Capital Improvement and Refunding Revenue Bonds, Series 2014A, and; Taxable Capital Improvement Refunding Revenue Bonds, Series 2014B.

111

Variance withOriginal Final Actual Amounts Final Budget

REVENUESMiscellaneous 83,200$ 470,870$ 235$ (470,635)$

Total revenues 83,200 470,870 235 (470,635)

EXPENDITURESDebt service:

Principal retirement 6,923,100 6,923,100 6,813,035 110,065 Interest 3,999,600 4,020,348 4,022,422 (2,074) Fiscal charges 9,800 14,537 11,223 3,314

Total expenditures 10,932,500 10,957,985 10,846,680 111,305 Excess (deficiency) of revenuesover (under) expenditures (10,849,300) (10,487,115) (10,846,445) (359,330)

OTHER FINANCING SOURCES (USES)Transfers in 10,849,300 10,487,115 10,466,570 (20,545)

Total other financing sources and uses 10,849,300 10,487,115 10,466,570 (20,545)

Net change in fund balances - - (379,875) (379,875)

Fund balances - beginning 7,262,753 7,262,753 5,620,962 (1,641,791) Fund balances - ending 7,262,753$ 7,262,753$ 5,241,087$ (2,021,666)$


Budgeted Amounts

CITY OF FORT MYERS, FLORIDASchedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual

Revenue Bonds and NotesFor the Year Ended September 30, 2015

113

CITY OF FORT MYERS

Nonmajor Governmental Funds

Special Revenue Funds Special revenue funds are used to account for specific revenue sources that are restricted, committed, or assigned to expenditures for particular purposes. Law Enforcement Trust – To account for the proceeds collected under the Florida Contraband Forfeiture Act to be used for school resource officers, crime prevention, safe neighborhoods, drug abuse education and prevention programs, and for other law enforcement purposes and providing matching funds to obtain federal grants.

Federal Forfeiture – To account for federal forfeiture proceeds, which can be expended for any activity calculated to enhance future investigations, support investigations and operations that may result in further seizures and forfeitures.

FEMA Disaster Grant – To account for the expenditures related to the damage caused by Hurricane Charley and the associated cleanup cost to be reimbursed by the Federal government.

Grants – To account for monies, received from various Federal, State and local agencies or private foundations, which must be expended according to the terms of grant requirements.

Special Assessment Geographical Area Administration (SAGA) – To account for Special Assessment District administration fees.

Police Training – To account for the $2 assessment paid by persons convicted for violation of city ordinances. This assessment may be used for criminal justice education and training for the local government unit’s officers and support personnel.

Street Light Maintenance – To account for the accumulation of funds to provide repairs and maintenance for certain street light poles and ballasts.

Street Maintenance – To account for funds received from the State for traffic light and street maintenance.

Public Art Fund – To account for proceeds from in-lieu contributions and all other revenue to support Public Art.

Law Enforcement Equipment Fund – To account for donations required of developers for law enforcement equipment purchases necessitated by commercial and residential development.

Attainable Workforce Housing Fund – To account for resources from developer contributions to provide loans to eligible residents with income of 150% of the median income for Lee County.

Hurricane Shelter – To account for developer contributions made to rehabilitate downtown buildings for use as hurricane shelters.

Public-Private Parking – To account for developer fees paid in lieu of the provision for parking.

East Riverside Community Center – To account for operations and maintenance of the community center, built for the citizens and visitors of Fort Myers and Lee County. Para-Transit Fund – To account for developer contributions made annually for a downtown trolley system.

114

CITY OF FORT MYERS

Nonmajor Governmental Funds (continued)

Special Revenue Funds (continued) Patrons of the Palms – To account for operations and resources related to maintaining palm trees, to enhance the City’s identity as the “City of Palms”.

State Housing Initiative Partnership Program – To account for funds received from the State of Florida to assist very low, low, and moderate income persons or families in becoming single-family homeowners.

Community Redevelopment Agency:

Downtown Redevelopment Area – To account for the operations and resources related to the Downtown Redevelopment Area.

Other Redevelopment Areas – To account for the administration and resources related to implementing the Cleveland Avenue Redevelopment Areas, the Central Fort Myers Redevelopment Area, the Martin Luther King Redevelopment Areas, Velasco Village Redevelopment Area, the East Fort Myers Redevelopment Area, the Eastwood Village Redevelopment Area, and the Dunbar-Michigan Redevelopment Area.

Community Development Block Grant Program – To account for monies received from the U.S. Department of Housing and Urban Development for community redevelopment. Crime Prevention Fund – To account for monies received from fines, which are used to advance the crime prevention program.

Permanent Fund The permanent fund is used to report resources that are legally restricted to the extent that only earnings, not principal, may be used for purposes that support the government’s programs. Ned Fould’s Police Award Fund – To account for a donation to the City to provide an award to the City’s Police Officer of the Year. The interest is awarded to the Officer of the Year with the principal being retained in the fund.

115

Law Enforcement

TrustFederal

ForfeitureFEMA Disaster

Grant GrantsSAGA

AdministrationASSETS

Cash and cash equivalents $ 74,925 $ 62,952 $ 13,292 $ - $ 126,424 Investments 33,281 27,963 5,943 - 56,156 Accounts receivable, net - - - - - Interest receivable 163 155 30 - 255 Due from other governmental agencies - - - 148,285 - Prepaid items - - - - - Notes receivable - - - - - Allowance for notes receivable - - - - - Assets held for resale - - - - -

Total assets $ 108,369 $ 91,070 $ 19,265 $ 148,285 $ 182,835

LIABILITIESAccounts and contracts payable $ 410 $ - $ - $ 9,366 $ - Accrued and other liabilities - - - 834 - Due to other funds - - - 134,384 - Due to other governmental agencies - - - - - Funds held in escrow - - - - - Unearned revenue - other - - - 3,700 - Advances from other funds - - - - -

Total liabilities 410 - - 148,284 -

DEFERRED INFLOWS OF RESOURCESUnavailable revenue - grants, contribution - - - 16,978 -

Total deferred inflows of resources - - - 16,978 -


Prepaid items - - - - - Asset held for resale - - - - - Public safety principal, nonexpendable - - - - -

Restricted for:Donations received - - - - - CRA - - - - - Economic environment - - - - - Law enforcement programs 107,959 91,070 - - - Physical environment - - 19,265 - 182,835 Transportation - - - - -

Committed to:Law enforcement programs - - - - -

Unassigned - - - (16,977) - Total fund balances (deficits) 107,959 91,070 19,265 (16,977) 182,835

Total liabilities, deferred inflows of resources, and fund balances (deficits) $ 108,369 $ 91,070 $ 19,265 $ 148,285 $ 182,835


Special Revenue Funds

CITY OF FORT MYERS, FLORIDACombining Balance Sheet

Nonmajor Governmental FundsSeptember 30, 2015

116

Police TrainingStreet Light Maintenance

Street Maintenance Public Art

Law Enforcement Equipment

Attainable Workforce Housing

Hurricane Shelter

$ 57,125 $ 56,840 $ 517,709 $ 80,101 $ 1,541 $ 485,828 $ 236,878 25,374 25,415 229,962 35,580 684 215,800 105,219 - - - - - - - 151 190 1,003 207 3 1,440 478 1,898 - 408,624 - - - - - - - - - - - - - - - - 132,330 - - - - - - (132,330) - - - - - - - - $ 84,548 $ 82,445 $ 1,157,298 $ 115,888 $ 2,228 $ 703,068 $ 342,575

$ 203 $ - $ 136,498 $ - $ - $ 12 $ - 585 - 6,128 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 788 - 142,626 - - 12 -

- - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - -

- - - 115,888 - 703,056 342,575 - - - - - - - - - - - - - - 83,760 - - - 2,228 - - - - - - - - - - 82,445 1,014,672 - - - -

- - - - - - - - - - - - - - 83,760 82,445 1,014,672 115,888 2,228 703,056 342,575

$ 84,548 $ 82,445 $ 1,157,298 $ 115,888 $ 2,228 $ 703,068 $ 342,575

(continued)


117

Public-Private Parking

East Riverside Community

Center Para-TransitPatrons of the

Palms

State Housing Initiative

PartnershipASSETS

Cash and cash equivalents $ 255,987 $ 15,943 $ 69,060 $ 12,799 $ 438,950 Investments 113,707 7,082 30,676 5,685 200,095 Accounts receivable, net - - 11,490 - - Interest receivable 517 32 311 26 537 Due from other governmental agencies - - - - - Prepaid items - - - - - Notes receivable - - - - 2,508,164 Allowance for notes receivable - - - - (2,508,164)Assets held for resale - - - - -

Total assets $ 370,211 $ 23,057 $ 111,537 $ 18,510 $ 639,582

LIABILITIESAccounts and contracts payable $ - $ - $ - $ - $ 20,520 Accrued and other liabilities - - - - 163 Due to other funds - - - - - Due to other governmental agencies - - - - - Funds held in escrow - - - - - Unearned revenue - other - - - - - Advances from other funds - - - - -

Total liabilities - - - - 20,683

DEFERRED INFLOWS OF RESOURCESUnavailable revenue - grants, contribution - - - - -

Total deferred inflows of resources - - - - -


Prepaid items - - - - - Asset held for resale - - - - - Public safety principal, nonexpendable - - - - -

Restricted for:Donations received 370,211 23,057 111,537 18,510 - CRA - - - - - Economic environment - - - - 618,899 Law enforcement programs - - - - - Physical environment - - - - - Transportation - - - - -

Committed to:Law enforcement programs - - - - -

Unassigned - - - - - Total fund balances (deficits) 370,211 23,057 111,537 18,510 618,899

Total liabilities, deferred inflows of resources, and fund balances (deficits) $ 370,211 $ 23,057 $ 111,537 $ 18,510 $ 639,582



CITY OF FORT MYERS, FLORIDACombining Balance Sheet

Nonmajor Governmental FundsSeptember 30, 2015

118

Community Redevelopment

Agency

Community Development Block Grant

Crime Prevention

Ned Fould's Police Award

Fund

Total Nonmajor Governmental

Funds

$ 1,943,599 $ 106,422 $ 46,106 $ 1,662 $ 4,604,143 884,165 47,271 20,480 743 2,071,281 78,050 - - - 89,540 6,520 - 74 3 12,095 28,577 84,817 178 - 672,379 1,125 - - - 1,125 - 3,514,832 - - 6,155,326 - (3,514,832) - - (6,155,326) 258,010 261,000 - - 519,010 $ 3,200,046 $ 499,510 $ 66,838 $ 2,408 $ 7,969,573

$ 138,925 $ 25,610 $ - $ - 331,544 674 597 - - 8,981 - - - - 134,384 27 261,000 - - 261,027 - - - 408 408 14,751 212,972 - - 231,423 617,000 - - - 617,000 771,377 500,179 - 408 1,584,767

106,627 - - - 123,605 106,627 - - - 123,605

1,125 - - - 1,125 258,010 - - - 258,010 - - - 2,000 2,000

- - - - 1,684,834 2,062,907 - - - 2,062,907 - - - - 618,899 - - - - 285,017 - - - - 202,100 - - - - 1,097,117

- - 66,838 - 66,838 - (669) - - (17,646) 2,322,042 (669) 66,838 2,000 6,261,201

$ 3,200,046 $ 499,510 $ 66,838 $ 2,408 $ 7,969,573

Permanent FundSpecial Revenue Funds

119

Law Enforcement

TrustFederal

ForfeitureFEMA Disaster

Grant GrantsSAGA

AdministrationREVENUES

Taxes $ - $ - $ - $ - $ - Intergovernmental revenue - - 6,255 1,433,412 - Fines and forfeitures 84,715 29,870 - - - Miscellaneous 9,239 12,225 6 - 396 Contributions - private source - - - - -

Total revenues 93,954 42,095 6,261 1,433,412 396


Public Safety:Police 84,067 51,448 - 351,545 - Fire - - - 1,104,648 -

Transportation - - - - - Economic environment - - - - - Culture and recreation - - 6,156 - -

Debt service:Principal retirement - - - - - Interest - - - - -

Total expenditures 84,067 51,448 6,156 1,456,193 - Excess (deficiency) of revenues over (under) expenditures 9,887 (9,353) 105 (22,781) 396

OTHER FINANCING SOURCES (USES)Transfers in - - - 16,964 - Transfers out - - - - -

Total other financing sources (uses) - - - 16,964 -

Net change in fund balances 9,887 (9,353) 105 (5,817) 396

Fund balances - beginning 98,072 100,423 19,160 (11,160) 182,439 Fund balances - ending $ 107,959 $ 91,070 $ 19,265 $ (16,977) $ 182,835


CITY OF FORT MYERS, FLORIDACombining Statement of Revenues, Expenditures and Changes in Fund Balances


Nonmajor Governmental FundsFor the Year Ended September 30, 2015

120

Police TrainingStreet Light Maintenance

Street Maintenance Public Art

Law Enforcement Equipment

Attainable Workforce Housing

$ - $ - $ 2,691,539 $ - $ - $ - - - 481,298 - - - - - - - - - 24,254 10 427,700 276 (4) (1,313) - - - 70 - - 24,254 10 3,600,537 346 (4) (1,313)

48,691 - - - - - - - - - - - - 16,377 3,493,602 - - - - - - - - 15,157 - - - - - -

- - - - - - - - - - - - 48,691 16,377 3,493,602 - - 15,157

(24,437) (16,367) 106,935 346 (4) (16,470)

- - 140,900 - - - - - (70,426) (6,789) - - - - 70,474 (6,789) - -

(24,437) (16,367) 177,409 (6,443) (4) (16,470)

108,197 98,812 837,263 122,331 2,232 719,526 $ 83,760 $ 82,445 $ 1,014,672 $ 115,888 $ 2,228 $ 703,056

(continued)


121

Hurricane Shelter

Public-Private Parking

East Riverside Community

Center Para-TransitPatrons of the

PalmsREVENUES

Taxes $ - $ - $ - $ - $ - Intergovernmental revenue - - - - - Fines and forfeitures - - - - - Miscellaneous (609) 803 51 423 40 Contributions - private source - - - 72,561 -

Total revenues (609) 803 51 72,984 40


Public Safety:Police - - - - - Fire - - - - -

Transportation - - - 115,431 - Economic environment - - - - -

- - - - - Debt service:

Principal retirement - - - - - Interest - - - - -

Total expenditures - - - 115,431 - Excess (deficiency) of revenues over (under) expenditures (609) 803 51 (42,447) 40

OTHER FINANCING SOURCES (USES)Transfers in - - - - - Transfers out - - - - -

Total other financing sources (uses) - - - - -

Net change in fund balances (609) 803 51 (42,447) 40

Fund balances - beginning 343,184 369,408 23,006 153,984 18,470 Fund balances - ending $ 342,575 $ 370,211 $ 23,057 $ 111,537 $ 18,510



CITY OF FORT MYERS, FLORIDACombining Statement of Revenues, Expenditures and Changes in Fund Balances

Nonmajor Governmental FundsFor the Year Ended September 30, 2015

122

PermanentFund

State Housing Initiative

Partnership

Community Redevelopment

Agency

Community Development Block Grant

Crime Prevention

Ned Fould's Police Award

Fund

Total Nonmajor Governmental

Funds

$ - $ 1,035,885 $ - $ - $ - $ 3,727,424 327,782 - 530,934 - - 2,779,681 - - - 5,050 - 119,635 42,059 22,706 95,817 126 - 634,205 - - - - - 72,631 369,841 1,058,591 626,751 5,176 - 7,333,576

- - - - - 535,751 - - - - - 1,104,648 - - - - - 3,625,410 110,473 2,827,558 570,327 - - 3,523,515 - - - - - 6,156

- 496,154 25,000 - - 521,154 - 161,377 1,622 - - 162,999 110,473 3,485,089 596,949 - - 9,479,633

259,368 (2,426,498) 29,802 5,176 - (2,146,057)

- 2,190,268 - - - 2,348,132 - (138,245) - - - (215,460) - 2,052,023 - - - 2,132,672

259,368 (374,475) 29,802 5,176 - (13,385)

359,531 2,696,517 (30,471) 61,662 2,000 6,274,586 $ 618,899 $ 2,322,042 $ (669) $ 66,838 $ 2,000 $ 6,261,201


123

Actual Variance withOriginal Final Amounts Final Budget

REVENUESFines and forfeitures $ 5,000 $ 5,000 $ 84,715 $ 79,715 Miscellaneous 100,000 100,000 9,239 (90,761)

Total revenues 105,000 105,000 93,954 (11,046)


Police 105,000 105,000 84,067 20,933 Total expenditures 105,000 105,000 84,067 20,933

Excess (deficiency) of revenues over expenditures - - 9,887 9,887

Net change in fund balances - - 9,887 9,887

Fund balances - beginning 98,072 98,072 98,072 - Fund balances - ending $ 98,072 $ 98,072 $ 107,959 $ 9,887

Budgeted Amounts


CITY OF FORT MYERS, FLORIDA

Law Enforcement Trust FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


124


REVENUESFines and forfeitures $ 40,000 $ 40,000 $ 29,870 $ (10,130)Miscellaneous 65,500 65,500 12,225 (53,275)

Total revenues 105,500 105,500 42,095 (63,405)



Excess (deficiency) of revenues over expenditures - - (9,353) (9,353)


Fund balances - beginning 100,423 100,423 100,423 - Fund balances - ending $ 100,423 $ 100,423 $ 91,070 $ (9,353)

Budgeted Amounts



Federal Forfeiture FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


125


REVENUESIntergovernmental revenue $ - $ - $ 6,255 $ 6,255 Miscellaneous - - 6 6

Total revenues - - 6,261 6,261


Culture and recreation - - 6,156 (6,156)Total expenditures - - 6,156 (6,156)

Excess (deficiency) of revenues over expenditures - - 105 105

Net change in fund balances - - 105 105

Fund balances - beginning 19,160 19,160 19,160 - Fund balances - ending $ 19,160 $ 19,160 $ 19,265 $ 105

Budgeted Amounts



FEMA Disaster GrantStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


126


REVENUESIntergovernmental revenue $ 821,408 $ 1,587,139 $ 1,433,412 $ (153,727)

Total revenues 821,408 1,587,139 1,433,412 (153,727)


Police 358,011 518,776 351,545 167,231 Fire 509,428 1,114,394 1,104,648 9,746

Total expenditures 867,439 1,633,170 1,456,193 176,977 Excess (deficiency) of revenues over expenditures (46,031) (46,031) (22,781) 23,250

OTHER FINANCING SOURCES (USES)Transfers in 46,031 46,031 16,964 (29,067)

Total other financing source (uses) 46,031 46,031 16,964 (29,067)


Fund balances - beginning (11,160) (11,160) (11,160) - Fund balances - ending $ (11,160) $ (11,160) $ (16,977) $ (5,817)

Budgeted Amounts



GrantsStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


127


REVENUESMiscellaneous $ - $ - $ 396 $ 396

Total revenues - - 396 396




Budgeted Amounts



Special Assessment Geographical Area AdministrationStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


128


REVENUESMiscellaneous $ 61,300 $ 61,300 $ 24,254 $ (37,046)

Total revenues 61,300 61,300 24,254 (37,046)






Budgeted Amounts



Police Training FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


129


REVENUESMiscellaneous $ 23,600 $ 23,600 $ 10 $ (23,590)

Total revenues 23,600 23,600 10 (23,590)


Transportation 23,600 23,600 16,377 7,223 Total expenditures 23,600 23,600 16,377 7,223




Budgeted Amounts



Street Light Maintenance FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


130


REVENUESTaxes $ 2,350,000 $ 2,350,000 $ 2,691,539 $ 341,539 Intergovernmental revenue 515,000 515,000 481,298 (33,702)Miscellaneous 731,000 794,550 427,700 (366,850)

Total revenues 3,596,000 3,659,550 3,600,537 (59,013)


Transportation 3,686,900 3,686,900 3,493,602 193,298 Total expenditures 3,686,900 3,686,900 3,493,602 193,298

Excess (deficiency) of revenues over expenditures (90,900) (27,350) 106,935 134,285

OTHER FINANCING SOURCES (USES)Transfers in 140,900 140,900 140,900 - Transfers out (50,000) (113,550) (70,426) 43,124

Total other financing source (uses) 90,900 27,350 70,474 43,124


Fund balances - beginning 837,263 837,263 837,263 - Fund balances - ending $ 837,263 $ 837,263 $ 1,014,672 $ 177,409

Budgeted Amounts



Street Maintenance FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


131


REVENUESMiscellaneous $ - $ 97,670 $ 276 $ (97,394)Contributions - private source - - 70 70

Total revenues - 97,670 346 (97,324)

Excess (deficiency) of revenues over expenditures - 97,670 346 (97,324)

OTHER FINANCING SOURCES (USES)Transfers out - (97,670) (6,789) 90,881

Total other financing source (uses) - (97,670) (6,789) 90,881



Budgeted Amounts



Public Art FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


132


REVENUESMiscellaneous $ - $ - $ (4) $ (4)

Total revenues - - (4) (4)

Excess (deficiency) of revenues over expenditures - - (4) (4)

Net change in fund balances - - (4) (4)

Fund balances - beginning 2,232 2,232 2,232 - Fund balances - ending $ 2,232 $ 2,232 $ 2,228 $ (4)

Budgeted Amounts



Law Enforcement Equipment FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


133


REVENUESMiscellaneous $ - $ 176,662 $ (1,313) $ (177,975)

Total revenues - 176,662 (1,313) (177,975)


Economic environment - 176,662 15,157 161,505 Total expenditures - 176,662 15,157 161,505


Net change in fund balances - - (16,470) (16,470)Fund balances - beginning 719,526 719,526 719,526 - Fund balances - ending $ 719,526 $ 719,526 $ 703,056 $ (16,470)

Budgeted Amounts



Attainable Workforce Housing FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


134


REVENUESMiscellaneous $ - $ - $ (609) $ (609)

Total revenues - - (609) (609)

Excess (deficiency) of revenues over expenditures - - (609) (609)

Net change in fund balances - - (609) (609)

Fund balances - beginning 343,184 343,184 343,184 - Fund balances - ending $ 343,184 $ 343,184 $ 342,575 $ (609)

Budgeted Amounts



Hurricane Shelter FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


135







Budgeted Amounts



Public-Private Parking FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


136







Budgeted Amounts



East Riverside Community Center FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


137


REVENUESMiscellaneous $ 69,200 $ 69,200 $ 423 $ (68,777)Contributions - private source 58,000 58,000 72,561 14,561

Total revenues 127,200 127,200 72,984 (54,216)


Transportation 127,200 127,200 115,431 11,769 Total expenditures 127,200 127,200 115,431 11,769




Budgeted Amounts



Para-Transit FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


138







Budgeted Amounts



Patrons of the Palms FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


139


REVENUESIntergovernmental revenue $ 222,935 $ 482,874 $ 327,782 $ (155,092)Miscellaneous - 72,381 42,059 (30,322)

Total revenues 222,935 555,255 369,841 (185,414)


Economic environment 222,935 555,255 110,473 444,782 Total expenditures 222,935 555,255 110,473 444,782




Budgeted Amounts



State Housing Initiative Partnership Program (SHIP)Statement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


140


REVENUESTaxes $ 913,000 $ 1,035,885 $ 1,035,885 $ - Intergovernmental revenue - 500,000 - (500,000)Miscellaneous 439,800 801,814 22,706 (779,108)

Total revenues 1,352,800 2,337,699 1,058,591 (1,279,108)


Economic environment 2,890,200 3,645,984 2,827,558 818,426 Total current 2,890,200 3,645,984 2,827,558 818,426

Debt service:Principal retirement 546,100 546,100 496,154 49,946 Interest 161,400 161,400 161,377 23

Total debt service 707,500 707,500 657,531 49,969 Total expenditures 3,597,700 4,353,484 3,485,089 868,395

Excess (deficiency) of revenues over expenditures (2,244,900) (2,015,785) (2,426,498) (410,713)

OTHER FINANCING SOURCES (USES)Transfers in 2,194,900 2,190,268 2,190,268 - Transfers out - (224,483) (138,245) 86,238

Total other financing source (uses) 2,244,900 2,015,785 2,052,023 36,238


Fund balances - beginning 2,696,517 2,696,517 2,696,517 - Fund balances - ending $ 2,696,517 $ 2,696,517 $ 2,322,042 $ (374,475)


Budgeted Amounts


Community Redevelopment AgencyStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


141


REVENUESIntergovernmental revenue $ 651,709 $ 1,821,752 $ 530,934 $ (1,290,818)Miscellaneous - 121,164 95,817 (25,347)

Total revenues 651,709 1,942,916 626,751 (1,316,165)


Economic environment 625,086 1,916,293 570,327 1,345,966 Total current 625,086 1,916,293 570,327 1,345,966

Debt service:Principal retirement 25,000 25,000 25,000 - Interest 1,623 1,623 1,622 1

Total debt service 26,623 26,623 26,622 1 Total expenditures 651,709 1,942,916 596,949 1,345,967



Fund balances - beginning (30,471) (30,471) (30,471) - Fund balances - ending $ (30,471) $ (30,471) $ (669) $ 29,802

Budgeted Amounts



Community Development Block Grant ProgramStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


142


REVENUESFines and forfeitures $ 5,000 $ 5,000 $ 5,050 $ 50 Miscellaneous 20,000 20,000 126 (19,874)

Total revenues 25,000 25,000 5,176 (19,824)


Police 25,000 25,000 - 25,000 Total expenditures 25,000 25,000 - 25,000




Budgeted Amounts



Crime Prevention FundStatement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual


143

CITY OF FORT MYERS

Nonmajor Enterprise Funds The City’s nonmajor enterprise funds report activities for which fees are charged to external users for goods or services. Building Permits and Inspections – To account for operations and maintenance related to the City’s issuance of building permits and the subsequent inspections. Stormwater – To account for the operations and maintenance of stormwater run-off mechanisms throughout the City. Fort Myers Country Club – To account for the operations and maintenance related to the City-owned Fort Myers Country Club. Eastwood Golf Course – To account for the operations and maintenance related to the City-owned Eastwood Golf Course. Yacht Basin – To account for the operations and maintenance of the City-owned yacht basin and dock facilities. Harborside Event Center – To account for the operations and maintenance of the Harborside Convention Center and Exhibition Hall. These facilities are available to the public on a rental basis or for City-sponsored functions. Downtown Parking Garages – To account for the operations and maintenance related to the City-owned Main Street Parking Garage and City of Palms Parking Garage. Skatium – To account for the operations and maintenance related to the City-owned skating and recreation center. Department of Cultural and Historic Affairs – To consolidate and account for the operations and maintenance of the Imaginarium Science Center, the Burrough’s Home, and Southwest Florida Museum of History.

145



Eastwood Golf Course


Cash and cash equivalents $ 4,918,708 $ 1,502,132 $ - $ 34,975 Investments 2,054,481 830,290 195,602 14,905 Restricted cash and cash equivalents 31,048 - 32,784 1,788 Restricted investments 144,410 - 1,123 799 Accounts receivable, net - 1,026 - - Interest receivable 6,927 3,709 111 304 Restricted interest receivable - - - - Due from other governmental agencies - 1,557,099 721,751 - Inventories - - - - Prepaid items 422,316 - 34,561 34,561

Total current assets 7,577,890 3,894,256 985,932 87,332

Noncurrent assets:Intangible assets, net - 72,571 - - Land and improvements - - 168,966 729,261 Construction in progress - 2,652,240 - - Buildings, net - - 184,947 1,598,303 Improvements other than buildings, net - 9,680,403 5,306,137 1,377,328 Equipment, net 59,379 865,010 389,848 155,988

Total noncurrent assets 59,379 13,270,224 6,049,898 3,860,880 Total assets 7,637,269 17,164,480 7,035,830 3,948,212

DEFERRED OUTFLOWS OF RESOURCESDeferred charge on refunding - - 5,544 - Deferred outflows on pension earnings 294,834 167,856 28,906 73,953

Total deferred outflows of resources 294,834 167,856 34,450 73,953


Accounts and contracts payable 5,270 1,348,005 117,107 9,424 Accrued and other liabilities 4,027 5,028 9,871 6,805 Due to other funds - - 748,978 - Due to other governmental agencies 39,525 - 3,632 2,665 Customer deposits 5,400 - - - Compensated absences 42,352 22,798 - 23,955 Accrued interest payable - - 4,627 - Leases payable - - 85,822 29,782 Notes payable - - - - Revenue bonds payable - - 31,812 -

Total current liabilities 96,574 1,375,831 1,001,849 72,631

Noncurrent liabilities:Net pension liability 3,160,532 1,799,362 309,866 792,752 Compensated absences 46,567 40,867 28,691 9,445 Other postemployment benefits payable 391,750 143,152 73,804 88,283 Leases payable - - 284,855 108,601 Notes payable - - - - Revenue bonds payable - - 260,996 -

Total noncurrent liabilities 3,598,849 1,983,381 958,212 999,081 Total liabilities 3,695,423 3,359,212 1,960,061 1,071,712

DEFERRED INFLOWS OF RESOURCESDeferred inflows related to pensions 24,753 14,094 2,427 6,210

Total deferred inflows of resources 24,753 14,094 2,427 6,210

NET POSITIONNet investment in capital assets 59,379 12,030,187 5,336,959 3,722,497 Restricted for:

Capital projects 422,438 1,179,095 54,998 - Culture and recreation - - - - Debt service - - 25,647 - Renewal and replacement - - - - Transportation - - - -

Unrestricted 3,730,110 749,748 (309,812) (778,254)Total net position $ 4,211,927 $ 13,959,030 $ 5,107,792 $ 2,944,243


CITY OF FORT MYERS, FLORIDACombining Statement of Net Position

Nonmajor Enterprise Funds September 30, 2015

146

Yacht BasinHarborside

Event Center

Downtown Parking Garages Skatium


Affairs

Total Nonmajor Enterprise

Funds

$ 354,380 $ 256,087 $ 562,818 $ - $ 105,162 $ 7,734,262 156,504 113,548 250,050 2 46,127 3,661,509 258,670 73,632 23,898 808 52,493 475,121 115,496 32,910 2,209 361 23,325 320,633 21,636 216,207 - 65,831 863 305,563 209 570 255 - 298 12,383 716 37 - - 170 923 - - - - - 2,278,850 102,134 - - 6,426 23,195 131,755 - - - - - 491,438 1,009,745 692,991 839,230 73,428 251,633 15,412,437

- - - - - 72,571 195,315 399,327 551,713 - 788,866 2,833,448 21,994 - - - - 2,674,234 2,820 2,338,932 2,745,518 20,024 687,163 7,577,707 4,342,610 31,442 - - 16,775 20,754,695 464 - - 4,998 - 1,475,687 4,563,203 2,769,701 3,297,231 25,022 1,492,804 35,388,342 5,572,948 3,462,692 4,136,461 98,450 1,744,437 50,800,779

- - - - - 5,544 56,162 103,151 - 44,512 71,767 841,141 56,162 103,151 - 44,512 71,767 846,685

29,539 317,272 48,944 23,202 27,039 1,925,802 6,102 15,703 1,539 3,358 7,971 60,404 - - - 31,083 - 780,061 6,458 2,926 4,180 1,169 2,147 62,702 44,009 96,584 2,950 - 1,654 150,597 9,074 15,334 - 4,276 19,221 137,010 13,979 - - - - 18,606 - - - - - 115,604 214,219 - - - - 214,219 - - - - - 31,812 323,380 447,819 57,613 63,088 58,032 3,496,817

602,036 1,105,746 - 477,154 769,323 9,016,771 15,495 27,979 - 14,937 40,751 224,732 83,305 162,968 4 97,119 138,379 1,178,764 - - - - - 393,456 3,533,824 - - - - 3,533,824 - - - - - 260,996 4,234,660 1,296,693 4 589,210 948,453 14,608,543 4,558,040 1,744,512 57,617 652,298 1,006,485 18,105,360

4,715 8,660 - 3,737 6,025 70,621 4,715 8,660 - 3,737 6,025 70,621

801,905 2,769,701 3,297,231 25,022 1,492,804 29,535,685

228,421 173 - - 18 1,885,143 - - - - 2,147 2,147 - - - - - 25,647 82,014 6,897 - - 72,169 161,080 - - 19,370 - - 19,370

(45,985) (964,100) 762,243 (538,095) (763,444) 1,842,411 $ 1,066,355 $ 1,812,671 $ 4,078,844 $ (513,073) $ 803,694 $ 33,471,483

147




OPERATING REVENUESCharges for services $ 4,462,205 $ 2,766,537 $ 1,742,313 $ 1,821,028 Rent - - 14,875 27,581 Miscellaneous 132 32,396 901 1,851

Total operating revenues 4,462,337 2,798,933 1,758,089 1,850,460

OPERATING EXPENSESPersonnel services 2,360,235 1,246,381 241,023 569,185 Materials and supplies 85,814 431,613 582,303 106,636 Contractual services 54,048 465,369 766,470 460,372 General and administrative 214,718 29,596 130,346 113,579 Utilities 12,200 255 79,479 174,847 Repairs and maintenance 1,774 35,374 26,474 42,159 Rentals 342,417 161,500 106,440 124,043 Travel 4,975 664 - - Insurance 36,200 54,300 72,400 72,400 Depreciation 16,733 709,274 368,369 195,675

Total operating expenses 3,129,114 3,134,326 2,373,304 1,858,896 Operating income (loss) 1,333,223 (335,393) (615,215) (8,436)

NONOPERATING REVENUES (EXPENSES)Operating grants and contributions - - - - Interest income 12,026 13,446 8,199 380 Gain on disposal of capital assets - 4,707 - - Interest expense and bond insurance costs - - (190,007) (3,557)

Total nonoperating revenues (expenses) 12,026 18,153 (181,808) (3,177)Income (loss) before contributions and transfers 1,345,249 (317,240) (797,023) (11,613)

Capital grants and contributions - 1,229,433 258,212 - Transfers in - 382,441 286,773 - Transfers out - (464,500) - (267,885)

Change in net position 1,345,249 830,134 (252,038) (279,498)

Net position - beginning 2,866,678 (1)

13,128,896 (1)

5,359,830 (1)

3,223,741 (1)

Net position - ending $ 4,211,927 $ 13,959,030 $ 5,107,792 $ 2,944,243



CITY OF FORT MYERS, FLORIDACombining Statement of Revenues, Expenditures, and Changes in Net Position

Nonmajor Enterprise FundsFor the Year Ended September 30, 2015

148


Event Center



Affairs


Funds

$ 2,292,461 $ - $ 1,112,511 $ 999,622 $ 535,185 $ 15,731,862 31,655 2,026,898 58,065 - - 2,159,074 65,740 46,900 - - 701 148,621 2,389,856 2,073,798 1,170,576 999,622 535,886 18,039,557

489,054 861,679 - 464,923 712,955 6,945,435 1,234,974 37,415 3,199 170,269 171,980 2,824,203 10,721 1,252,198 612,990 113,451 86,618 3,822,237 117,024 240,676 32,246 66,117 150,275 1,094,577 172,045 197,598 3,136 230,144 131,445 1,001,149 44,186 45,208 90,682 52,765 87,933 426,555 50,581 102,283 - 77,789 124,228 1,089,281 806 - - - 5,935 12,380 72,400 144,800 - 72,400 90,500 615,400 214,874 399,063 307,236 2,956 66,973 2,281,153 2,406,665 3,280,920 1,049,489 1,250,814 1,628,842 20,112,370

(16,809) (1,207,122) 121,087 (251,192) (1,092,956) (2,072,813)

- - - - 1,646 1,646 1,363 557 111 61 994 37,137 890 - - - - 5,597

(181,197) - - - - (374,761) (178,944) 557 111 61 2,640 (330,381)

(195,753) (1,206,565) 121,198 (251,131) (1,090,316) (2,403,194)

- - - - - 1,487,645 367,100 849,000 - 289,100 1,056,335 3,230,749

(33,575) (40,543) (102,688) (27,208) - (936,399)

137,772 (398,108) 18,510 10,761 (33,981) 1,378,801

928,583 (1)

2,210,779 (1)

4,060,334 (523,834)(1)

837,675 (1)

32,092,682 (1)

$ 1,066,355 $ 1,812,671 $ 4,078,844 $ (513,073) $ 803,694 $ 33,471,483

149




CASH FLOWS FROM OPERATING ACTIVITIESReceipts from customers $ 4,462,205 $ 1,803,576 $ 1,498,976 $ 1,848,609 Other operating receipts 132 32,396 901 1,851 Payments to suppliers and service providers (1,215,010) (652,653) (1,710,081) (1,088,126)Payments to employees for services (2,331,091) (1,234,999) (237,498) (571,273)Other operating payments (18,227) (28,987) (4,255) (12,771)

Net cash provided by (used for) operating activities 898,009 (80,667) (451,957) 178,290

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIESTransfers in - 382,441 286,773 - Transfers out - (464,500) - (267,885)Operating grants and private contributions - - - - Receipts on interfund loans - - 748,978 -

Net cash provided by (used for) noncapital financing activities - (82,059) 1,035,751 (267,885)

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIESCapital grants and private contributions - 1,141,384 258,212 - Acquisition and construction of capital assets (12,236) (2,857,133) (2,536,479) (23,282)Principal paid on notes and bonds - - (30,294) - Interest paid on notes and bonds - - (181,937) - Proceeds from sale of capital assets - 6,000 - -

Net cash (used for) capital and related financing activities (12,236) (1,709,749) (2,490,498) (23,282)

CASH FLOWS FROM INVESTING ACTIVITIESPurchase of investments (393,824) - (160) (123)Proceeds from sale of investments - 385,128 414,376 32,214 Interest on investments 2,948 2,289 - -

Net cash provided by (used for) investing activities (390,876) 387,417 414,216 32,091 Net increase (decrease) in cash and cash equivalents 494,897 (1,485,058) (1,492,488) (80,786)

Balances - beginning of year 4,454,859 2,987,190 1,525,272 117,549 Balances - end of the year $ 4,949,756 $ 1,502,132 $ 32,784 $ 36,763

Reconciliation of operating income (loss) to net cash provided by (used for) operating activities:Operating income (loss) $ 1,333,223 $ (335,393) $ (615,215) $ (8,436)Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities:

Depreciation 16,733 709,274 368,369 195,675 Pension expense (26,223) (14,930) (2,571) (6,578)Changes in assets and liabilities:

(Increase) decrease in accounts receivable - (868,042) (258,212) - (Increase) decrease in bad debt - (94,919) - - (Increase) decrease in inventories (422,316) - - - (Increase) decrease in prepaid items - - (678) (678)(Decrease) increase in customer deposits payable (26,100) - - - (Decrease) increase in accounts payable - supplier (40,402) 497,032 46,698 (4,373)(Decrease) increase in accounts payable - other 7,727 - 3,555 (1,809)(Decrease) increase in compensated absences 4,507 2,482 1,163 (5,840)Increase in other postemployement benefits 50,860 23,829 4,934 10,329

Net cash provided (used) by operating activities $ 898,009 $ (80,667) $ (451,957) $ 178,290

Schedule of non-cash investing, capital, and financing activities:Interest receivable / unrealized gain (loss) 9,078$ 11,157$ 8,199$ 380$

Donation of utility improvements - 88,049 - -


CITY OF FORT MYERS, FLORIDACombining Statement of Cash Flows

Nonmajor Enterprise FundsFor the Year Ended September 30, 2015

150


Event Center



Affairs


Funds

$ 2,344,341 $ 1,856,628 $ 1,170,576 $ 959,131 $ 534,323 $ 16,478,365 65,740 46,900 - - 701 148,621 (1,694,083) (1,766,652) (646,836) (792,216) (875,161) (10,440,818) (483,545) (845,468) - (473,610) (694,588) (6,872,072) (333) (6,869) (8,641) (4,020) (18,554) (102,657) 232,120 (715,461) 515,099 (310,715) (1,053,279) (788,561)

367,100 849,000 - 289,100 1,056,335 3,230,749 (33,575) (40,543) (102,688) (27,208) - (936,399) - - - - 1,646 1,646 - - - 31,083 - 780,061

333,525 808,457 (102,688) 292,975 1,057,981 3,076,057

- - - - - 1,399,596 (81,736) - - - (62,768) (5,573,634) (204,916) - - - - (235,210) (181,961) - - - - (363,898) 890 - - - - 6,890

(467,723) - - - (62,768) (4,766,256)

(45,255) (36,047) (137,491) (11) - (612,911) - - - 4,778 12,521 849,017 203 108 245 - 405 6,198 (45,052) (35,939) (137,246) 4,767 12,926 242,304 52,870 57,057 275,165 (12,973) (45,140) (2,236,456) 560,180 272,662 311,551 13,781 202,795 10,445,839 $ 613,050 $ 329,719 $ 586,716 $ 808 $ 157,655 $ 8,209,383

$ (16,809) $ (1,207,122) $ 121,087 $ (251,192) $ (1,092,956) $ (2,072,813)

214,874 399,063 307,236 2,956 66,973 2,281,153 (4,995) (9,175) - (3,959) (6,383) (74,814)

10,926 (195,001) - (40,491) (863) (1,351,683) (1,576) 24,730 - - - (71,765) 26,659 - - (1,058) 5,373 (391,342) - - 47,083 - - 45,727 10,475 19,512 283 (1,040) (16,277) (13,147) (18,281) 225,613 38,919 (10,968) (34,911) 699,327 342 1,533 491 (237) 1,014 12,616 522 6,522 - (16,010) 9,065 2,411 9,983 18,864 - 11,284 15,686 145,769

$ 232,120 $ (715,461) $ 515,099 $ (310,715) $ (1,053,279) $ (788,561)

1,160$ 449$ (134)$ 61$ 589$ $ 30,939

- - - - - 88,049

151

CITY OF FORT MYERS

Internal Service Funds Internal service funds are used to account for services provided to other departments or agencies of the government, or to other governments on a cost-reimbursement basis. Central Garage – To account for repair operations and maintenance related to City-owned vehicles. Information Technology Services – To account for the City’s information systems, hardware, software and maintenance. Public Works Warehouse Operations – To account for all inventory received into the warehouse along with the issues out to user departments. Risk Management – To account for the activities related to general liability, auto liability and physical damage, police and firefighters’ professional liability and workers’ compensation provided to other departments of the City.

153

Central Garage

Information Technology

Services

Public Works Warehouse Operations

Risk Management

Total Internal Service Funds


Cash and cash equivalents $ 800,633 $ 606,893 $ 97,376 $ 7,165,652 $ 8,670,554 Investments 355,633 269,576 43,253 3,510,768 4,179,230 Restricted cash and cash equivalents - - - 3,455,479 3,455,479 Accounts receivable, net - - - 1,662 1,662 Interest receivable 1,019 1,529 - 15,199 17,747 Due from other governmental agencies - - - 383 383 Inventories 227,172 - 408,689 - 635,861 Prepaid items - 156,155 - 116,230 272,385

Total current assets 1,384,457 1,034,153 549,318 14,265,373 17,233,301 Noncurrent assets:

Intangible assets, net - 13,406 - - 13,406 Buildings, net 4,267 - - - 4,267 Equipment, net 747,379 144,579 - - 891,958

Total noncurrent assets 751,646 157,985 - - 909,631 Total assets 2,136,103 1,192,138 549,318 14,265,373 18,142,932

DEFERRED OUTFLOWS OF RESOURCESDeferred outflows on pension earnings 148,566 269,473 - 21,702 439,741

Total deferred outflows of resources 148,566 269,473 - 21,702 439,741


Accounts and contracts payable 162,219 31,652 23,738 437,826 655,435 Accrued and other liabilities 7,541 99,452 892 4,424 112,309 Compensated absences 16,067 7,154 - - 23,221 Claims and judgments - - - 3,166,600 3,166,600 Capital leases payable - 78,200 - - 78,200

Total current liabilities 185,827 216,458 24,630 3,608,850 4,035,765 Noncurrent liabilities:

Net pension liability 1,592,586 2,888,673 - 232,644 4,713,903 Compensated absences 38,420 61,155 - 2,715 102,290 Other postemployment benefits payable 186,262 273,570 - 37,452 497,284 Claims and judgments - - - 2,250,488 2,250,488

Total noncurrent liabilities 1,817,268 3,223,398 - 2,523,299 7,563,965 Total liabilities 2,003,095 3,439,856 24,630 6,132,149 11,599,730

DEFERRED INFLOWS OF RESOURCESDeferred inflows related to pensions 12,473 22,624 - 1,822 36,919

Total deferred inflows of resources 12,473 22,624 - 1,822 36,919

NET POSITIONNet investment in capital assets 751,646 79,785 - - 831,431 Unrestricted (482,545) (2,080,654) 524,688 8,153,104 6,114,593

Total net position $ 269,101 $ (2,000,869) $ 524,688 $ 8,153,104 $ 6,946,024


CITY OF FORT MYERS, FLORIDACombining Statement of Net Position

Nonmajor Internal Service Funds September 30, 2015

154

Central Garage


Services


Risk Management


OPERATING REVENUESCharges for services $ 5,538,000 $ 5,273,000 $ 542,422 $ 5,783,883 $ 17,137,305 Miscellaneous 2,521 7,118 - 419,050 428,689

Total operating revenues 5,540,521 5,280,118 542,422 6,202,933 17,565,994

OPERATING EXPENSESPersonnel services 1,143,651 1,813,645 - 213,547 3,170,843 Materials and supplies 2,374,776 290,566 447,672 6,488 3,119,502 Contractual services 410,666 44,994 200 270,968 726,828 General and administrative 256,012 196,806 23,413 203,359 679,590 Utilities 74,478 532,587 - - 607,065 Repairs and maintenance 7,000 1,123,545 - - 1,130,545 Rentals 134,100 230,866 - 18,600 383,566 Travel 3,399 16,058 - - 19,457 Insurance 36,200 5,400 - 1,139,610 1,181,210 Self insurance claims - - - 3,203,903 3,203,903 Depreciation 302,211 101,092 - - 403,303

Total operating expenses 4,742,493 4,355,559 471,285 5,056,475 14,625,812 Operating income 798,028 924,559 71,137 1,146,458 2,940,182

NONOPERATING REVENUES (EXPENSES)Interest income 4 584 - 19,144 19,732 Gain (loss) on disposal of capital assets (7,383) 17 - - (7,366)Interest expense - (1,540) - - (1,540)

Total nonoperating revenues (expenses) (7,379) (939) - 19,144 10,826 Income (loss) before contributions and transfers 790,649 923,620 71,137 1,165,602 2,951,008

Transfers out (276,500) (727,653) - (313,567) (1,317,720)Change in net position 514,149 195,967 71,137 852,035 1,633,288

Net position - beginning (245,048) (1) (2,196,836) (1) 453,551 7,301,069 (1) 5,312,736 (1)

Net position - ending $ 269,101 $ (2,000,869) $ 524,688 $ 8,153,104 $ 6,946,024



CITY OF FORT MYERS, FLORIDACombining Statement of Revenues, Expenditures, and Changes in Net Position

Internal Service FundsFor the Year Ended September 30, 2015

155

Central Garage


Services


Risk Management


CASH FLOWS FROM OPERATING ACTIVITIESReceipts from customers $ 5,538,000 $ 5,273,000 $ 542,422 $ 5,783,731 $ 17,137,153 Other operating receipts 2,521 7,118 - 419,050 428,689 Payments to suppliers and service providers (3,212,025) (2,468,172) (472,619) (2,293,709) (8,446,525)Payments to employees for services (1,130,109) (1,802,869) - (2,230,335) (5,163,313)

Net cash provided by operating activities 1,198,387 1,009,077 69,803 1,678,737 3,956,004

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES

Transfers out (276,500) (727,653) - (313,567) (1,317,720)Net cash (used for) noncapital financing activities (276,500) (727,653) - (313,567) (1,317,720)

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES

Acquisition and construction of capital assets (298,845) (38,579) - - (337,424)Principal paid on capital lease - (116,321) - - (116,321)Interest paid on capital lease - (1,540) - - (1,540)Proceeds from sale of capital assets 7,000 17 - - 7,017

Net cash (used for) capital and related financing activities (291,845) (156,423) - - (448,268)

CASH FLOWS FROM INVESTING ACTIVITIESPurchase of investments (204,822) (53,160) (22,920) (616,236) (897,138)Interest on investments 441 - - 5,099 5,540

Net cash (used for) investing activities (204,381) (53,160) (22,920) (611,137) (891,598)Net increase in cash and cash equivalents 425,661 71,841 46,883 754,033 1,298,418

Balances - beginning of year 374,972 535,052 50,493 9,867,098 10,827,615 Balances - end of the year $ 800,633 $ 606,893 $ 97,376 $ 10,621,131 $ 12,126,033

Reconciliation of operating income to net cash provided by operating activities:Operating income $ 798,028 $ 924,559 $ 71,137 $ 1,146,458 $ 2,940,182 Adjustments to reconcile operating income to net cash provided by operating activities:

Depreciation 302,211 101,092 - - 403,303 Pension expense (13,214) (23,968) - (1,930) (39,112)Changes in assets and liabilities:

(Increase) in accounts receivable - - - (152) (152)(Increase) decrease in inventories 32,944 - (8,726) - 24,218 (Increase) in prepaid items - (35,136) - (87,789) (122,925)Increase in accounts payable - supplier 51,663 7,787 7,392 616,211 683,053 (Decrease) increase in compensated absences 3,834 (2,780) - 1,091 2,145 Increase in other postemployment benefits 22,921 37,523 - 4,848 65,292

Net cash provided (used) by operating activities $ 1,198,387 $ 1,009,077 $ 69,803 $ 1,678,737 $ 3,956,004

Noncash investing, capital, and financing activities:Interest receivable / unrealized gain (loss) (437)$ 584$ -$ 14,045$ $ 14,192


CITY OF FORT MYERS, FLORIDACombining Statement of Cash Flows

Internal Service FundsFor the Year Ended September 30, 2015

156

CITY OF FORT MYERS

Fiduciary Funds

Agency Funds Agency funds are used to account for monies that are collected by the City and held in a custodial capacity until remitted to the proper authority. Regional Park Impact Fees Fund – To account for the City’s collection of regional park fees. The fees are remitted to the County. Emergency Medical Services (EMS) Impact Fees Fund – To account for the City’s collection of impact fees for EMS services. The fees are remitted to the County. School Board Impact Fees Fund – To account for the City’s collection of impact fees for the School Board. The fees are remitted to the County. Unclaimed Funds Fund – To account for funds that the City has been holding, and if not claimed, will eventually be remitted to the State of Florida. Employees’ Special Events Fund – To account for money held for special events for the City’s employees. The Special Events Committee raises its own funds and the City provides the tracking and accounting of those funds.

157

Additions DeductionsRegional Park Impact Fees

ASSETSCash and short-term investments $ 17,989 $ 213,065 $ (169,118) $ 61,936

Total assets $ 17,989 $ 213,065 $ (169,118) $ 61,936

LIABILITIES Accounts and contracts payable $ 8,699 $ 159,683 $ (144,510) $ 23,872 Due to other governmental agencies 9,290 188,538 (159,764) 38,064

Total liabilities $ 17,989 $ 348,221 $ (304,274) $ 61,936

Emergency Medical Services Impact FeesASSETS

Cash and short-term investments $ 6,429 $ 55,134 $ (49,545) $ 12,018 Interest receivable 6 - (1) 5

Total assets $ 6,435 $ 55,134 $ (49,546) $ 12,023



School Board Impact FeesASSETS

Cash and short-term investments $ 40,577 $ 248,854 $ (217,449) $ 71,982 Total assets $ 40,577 $ 248,854 $ (217,449) $ 71,982



Unclaimed FundsASSETS

Cash and short-term investments $ - $ 28,440 $ (28,440) $ - Total assets $ - $ 28,440 $ (28,440) $ -

LIABILITIESAccounts and contracts payable $ - $ 28,391 $ (28,391) $ - Accrued and other liabilities - 28,391 (28,391) -

Total liabilities $ - $ 56,782 $ (56,782) $ -

Employees' Special EventsASSETS


Total assets $ 21,081 $ 61,491 $ (58,970) $ 23,602

LIABILITIESAccounts and contracts payable $ 1,362 $ 32,985 $ (33,229) $ 1,118 Accrued and other liabilities 19,719 48,006 (45,241) 22,484


Total - All Agency FundsASSETS


Total assets $ 86,082 $ 606,984 $ (523,523) $ 169,543

LIABILITIESAccounts and contracts payable $ 25,503 $ 466,671 $ (433,115) $ 59,059 Accrued and other liabilities 19,719 76,397 (73,632) 22,484 Due to other governmental agencies 40,860 452,647 (405,507) 88,000



Combining Statement of Changes in Assets and Liabilities

Balance September 30,

2014

Balance September 30,

2015


Agency FundsFor the Year Ended September 30, 2015

158

Statistical Section

CITY OF FORT MYERS

Statistical Section This part of the City of Fort Myers’s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, notes disclosures and required supplementary information says about the City’s overall financial health. Contents Page Financial Trends 160

These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time.

Revenue Capacity 168

These schedules contain information to help the reader assess the City’s most significant revenue sources, the property tax and water and wastewater sales.

Debt Capacity 172

These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future.

Note: The Constitution of the State of Florida (FS200.181) and the City

of Fort Myers set no legal debt limit. Demographic and Economic Information 178

These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place.

Operating Information 179

These schedules contain service data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs.

159

2006 2007 2008 2009Governmental activities

Net investment in capital assets $ 20,470,042 (1) $ 34,487,088 $ 43,367,922 $ 40,276,557Restricted

Capital projects 25,862,555 22,751,244 42,577,813 46,286,423

Culture and recreation - 260,789 276,244 280,019Debt service 4,555,317 6,119,514 6,662,297 6,991,217Economic environment - 5,860,914 (2) 7,509,337 9,267,781General government - 1,314,159 1,276,433 1,255,036Impact fee projects - 34,824,240 22,540,220 21,822,142Public safety: Expendable - 3,646,476 2,193,757 2,121,578 Nonexpendable - 2,000 2,000 2,000Renewal and replacement - 560,448 640,338 688,227Transportation - 1,902,651 1,097,513 1,347,675Community development projects 1,347,833 - - - Other purposes 3,820,055 - - -

Unrestricted 37,033,475 (1) 26,720,050 27,802,898 29,110,288Total governmental activities net position $ 93,089,277 (1) $ 138,449,573 (2) $ 155,946,772 $ 159,448,943

Business-type activitiesNet investment in capital assets $ 30,338,162 $ 54,548,382 (2) $ 53,546,225 $ 73,491,549 (3)

RestrictedCapital projects 14,891,747 141,342 12,071,684 6,075,450Culture and recreation - 192,390 - - Debt service 10,641,510 7,106,456 5,335,395 9,552,634Impact fee projects 3,785,913 4,469,102 5,788,394 2,839,477Physical environment - 4,708,732 20,814 201,877Public safety - 101,230 - - Renewal and replacement 4,096,616 3,616,097 5,425,078 6,074,195Transportation - 28,601 17,430 12,005Operations and maintenance 11,660,878 - - -

Unrestricted 12,352,612 (1) 31,211,703 28,307,366 23,926,440Total business-type activities net position $ 87,767,438 (1) $ 106,124,035 (2) $ 110,512,386 (3) $ 122,173,627

Primary governmentNet investment in capital assets $ 50,808,204 (1) $ 89,035,470 $ 96,914,147 $ 113,768,106 (3)

RestrictedCapital projects 40,754,302 22,892,586 54,649,497 52,361,873Culture and recreation - 453,179 276,244 280,019Debt service 15,196,827 13,225,970 11,997,692 16,543,851Economic environment - 5,358,507 7,509,337 9,267,781General government - 1,314,159 1,276,433 1,255,036Impact fee projects 3,785,913 39,293,342 28,328,614 24,661,619Physical environment - 4,708,732 20,814 201,877Public safety: Expendable - 3,747,706 2,193,757 2,121,578 Nonexpendable - 2,000 2,000 2,000Renewal and replacement 4,096,616 4,176,545 6,065,416 6,762,422Transportation - 1,931,252 1,114,943 1,359,680Community development projects 1,347,833 - - - Operations and maintenance 11,660,878 - - - Other purposes 3,820,055 - - -

Unrestricted 49,386,087 58,434,160 (2) 56,110,264 53,036,728Total primary government net position $ 180,856,715 (1) $ 244,573,608 (2) $ 266,459,158 (3) $ 281,622,570

(1) Restated per Note 8 in fiscal year 2007.(2) Restated per Note 8 in fiscal year 2008.(3) Restated per Note 6 in fiscal year 2010.(4) Restated per Note 25 in fiscal year 2013.(5) Restated per Note 24 in fiscal year 2015.

CITY OF FORT MYERS, FLORIDASchedule 1 - Net Position by Component

Last Ten Fiscal Years(accrual basis of accounting)

160

2010 2011 2012 2013 2014 2015

$ 46,344,509 $ 51,407,651 $ 59,741,815 (4) $ 58,088,422 (4) $ 49,609,728 $ 54,323,549

51,823,762 41,275,888 43,801,907 40,910,394 34,732,077 31,831,335

255,071 63,445 64,156 168,328 163,808 157,4547,135,436 7,289,473 7,262,753 7,265,355 5,620,962 5,241,0878,305,107 4,047,022 4,185,328 5,292,390 3,517,564 3,384,8621,271,958 - - - - -

19,039,083 2,956,361 2,367,429 14,019,479 15,393,894 14,982,630

1,862,166 1,004,294 838,983 839,717 671,268 646,8572,000 2,000 2,000 2,000 2,000 2,000

619,991 391,971 2,229 3,661 - - 2,000,218 1,840,923 1,214,186 2,036,261 1,641,906 1,761,702

- - - - - - - - - - - -

19,333,583 43,311,168 31,608,418 3,352,665 (121,532,294) (5) (126,181,151)$ 157,992,884 $ 153,590,196 $ 151,089,204 (4) $ 131,978,672 (4) $ (10,179,087) (5) $ (13,849,675)

$ 80,328,915 $ 77,483,278 $ 46,140,478 (4) $ 54,346,522 (4) $ 66,890,713 $ 81,959,336

1,198,244 2,663,957 13,767,152 12,784,220 12,973,297 13,798,73828 7,299 - - - 2,147

11,400,208 10,527,927 7,853,276 7,933,788 9,940,611 10,125,372972,235 862,413 797,517 798,720 3,144,674 6,549,995142,889 - - - - -

- - - - - - 6,121,090 6,108,968 6,661,111 7,766,842 9,337,620 10,292,820

7,347 8,827 5,899 15,305 26,500 19,370- - - - - -

21,024,664 27,827,659 38,251,249 36,333,372 17,979,772 (5) 14,535,250$ 121,195,620 $ 125,490,328 $ 113,476,682 (4) $ 119,978,769 (4) $ 120,293,187 (5) $ 137,283,028

$ 126,673,424 $ 128,890,929 $ 105,882,293 (4) $ 112,434,944 (4) $ 116,500,441 $ 136,282,885

53,022,006 43,939,845 57,569,059 53,694,614 47,705,374 45,630,073255,099 70,744 64,156 168,328 163,808 159,601

18,535,644 17,817,400 15,116,029 15,199,143 15,561,573 15,366,4598,305,107 4,047,022 4,185,328 5,292,390 3,517,564 3,384,8621,271,958 - - - - -

20,011,318 3,818,774 3,164,946 14,818,199 18,538,568 21,532,625142,889 - - - - -

1,862,166 1,004,294 838,983 839,717 671,268 646,8572,000 2,000 2,000 2,000 2,000 2,000

6,741,081 6,500,939 6,663,340 7,770,503 9,337,620 10,292,8202,007,565 1,849,750 1,220,085 2,051,566 1,668,406 1,781,072

- - - - - - - - - - - - - - - - - -

40,358,247 71,138,827 69,859,667 39,686,037 (103,552,522) (5) (111,645,901)$ 279,188,504 $ 279,080,524 $ 264,565,886 (4) $ 251,957,441 (4) $ 110,114,100 (5) $ 123,433,353

CITY OF FORT MYERS, FLORIDASchedule 1 - Net Position by Component (continued)


161

2006 2007 2008 2009ExpensesGovernmental Activities:

General government $ 11,150,038 $ 18,412,703 $ 16,492,461 $ 17,629,323Police 22,782,979 27,757,527 31,773,124 29,213,985Fire 14,307,615 17,417,874 20,194,245 17,983,913Protective inspections 2,331,605 2,641,533 2,778,609 2,402,582Other 69,939 - 16,738 - Physical environment 7,608,612 6,866,875 7,621,568 3,248,941Transportation 6,844,796 12,558,630 12,777,745 13,144,626Economic environment 11,070,787 4,413,260 4,984,291 7,131,285Culture and recreation 3,367,159 2,289,921 4,195,004 4,158,147Interest on long-term debt 4,890,033 5,880,340 5,455,071 5,314,097

Total Governmental Activities 84,423,563 98,238,663 106,288,856 100,226,899

Business-type Activities:Water-Wastewater 32,752,832 36,136,629 39,689,601 36,707,074Solid Waste 10,134,684 11,221,911 12,242,537 11,069,317Building Permits and Inspections 3,785,956 4,543,886 4,895,643 3,913,932Stormwater - - - 1,640,896Golf Courses 2,893,019 3,038,786 3,690,953 3,321,542Yacht Basin 2,459,101 2,271,326 2,236,830 2,100,472Harborside Event Center 2,065,603 2,173,280 2,184,100 2,156,990Downtown Parking Garages - 995,977 979,551 1,028,549Skatium - 869,171 1,140,585 1,252,056Historical Homes 6,606,002 1,923,733 1,962,904 1,703,697Department of Cultural and Historic Affairs (2) - - - -

Total Business-type Activities 60,697,197 63,174,699 69,022,704 64,894,525

Total Expenses $ 145,120,760 $ 161,413,362 $ 175,311,560 $ 165,121,424

Program RevenuesGovernmental Activities:

Charges for servicesGeneral government $ 860,044 $ 1,219,844 $ 1,201,287 $ 597,963Police 1,624,696 1,846,531 2,506,830 2,077,930Fire 2,238,483 2,040,100 1,369,961 661,709Protective inspections (3) 3,766,564 3,408,549 1,142,996 898,571Physical environment 5,018,116 4,034,897 3,403,086 460,202Transportation 881,853 314,907 393,104 650Economic environment 96,948 190,179 195,428 95,203Culture and recreation 1,161,852 1,108,748 925,664 528,214

Operating grants and contributions 11,591,841 3,211,837 2,909,707 3,233,726Capital grants and contributions 10,132,435 33,886,717 18,611,350 7,754,113

Total Governmental Activities 37,372,832 51,262,309 32,659,413 16,308,281

Business-type Activities:Charges for services

Water-Wastewater 44,690,090 42,791,290 43,495,343 45,692,290Solid Waste 13,982,379 15,032,009 15,829,218 13,973,878Building Permits and Inspections 7,133,301 5,189,047 3,181,581 1,581,669Stormwater - - - 1,703,563Golf Courses 3,154,236 2,988,967 2,861,898 3,132,618Yacht Basin 2,291,421 1,943,558 1,882,893 1,771,060Harborside Event Center 1,255,948 1,211,109 1,009,546 822,205Downtown Parking Garages - 896,431 926,002 794,992Skatium - 649,017 819,592 868,286Historical Homes 3,889,273 583,770 530,150 492,281Department of Cultural and Historic Affairs (2) - - - -

Operating grants and contributions 73,706 34,627 20,318 21,339Capital grants and contributions 1,777,206 13,743,922 8,159,203 10,022,669

Total Business-type Activities 78,247,560 85,063,747 78,715,744 80,876,850

Total Program Revenues $ 115,620,392 $ 136,326,056 $ 111,375,157 $ 97,185,131

Net (Expense)/RevenueGovernmental Activities $ (47,050,731) $ (46,976,354) $ (73,629,443) $ (83,918,618)Business-type Activities 17,550,363 21,889,048 9,693,040 15,982,325

Total Net Expense $ (29,500,368) $ (25,087,306) $ (63,936,403) $ (67,936,293)

CITY OF FORT MYERS, FLORIDASchedule 2 - Changes in Net Position


162

2010 2011 2012 2013 2014 2015

$ 16,675,130 $ 13,184,596 $ 14,026,296 (4) $ 12,167,626 $ 12,200,476 $ 9,914,14831,887,208 32,408,078 33,417,494 35,492,533 36,183,148 35,863,63316,722,815 18,614,040 20,056,573 21,255,783 20,189,676 19,496,7881,555,000 1,470,340 1,627,330 1,428,519 1,448,884 1,546,049

- - - - - - 2,357,311 2,260,742 4,879,919 5,094,677 5,754,949 5,882,766

11,558,730 14,306,220 10,505,928 19,528,061 19,957,055 17,111,2717,830,674 5,269,595 4,515,627 4,183,689 6,199,726 4,184,2943,781,245 3,453,021 3,628,966 3,501,196 3,759,704 3,635,0563,658,929 4,060,650 5,328,432 4,981,829 5,118,896 4,481,774

96,027,042 95,027,282 97,986,565 (4) 107,633,913 110,812,514 102,115,779

45,914,665 44,539,869 65,678,945 (4) 45,188,740 46,061,313 49,841,77910,541,992 9,413,560 8,754,026 (4) 8,668,898 8,878,238 9,642,1212,688,251 2,308,477 2,470,171 2,339,039 2,836,337 3,129,1132,053,906 2,928,303 2,768,189 2,676,947 2,802,742 3,134,3273,273,457 3,086,750 3,258,666 (4) 3,192,083 3,251,488 4,425,7632,399,954 2,447,680 2,378,769 (4) 2,625,787 2,816,344 2,587,8632,215,480 2,113,002 2,029,197 2,026,123 2,004,116 3,280,9211,026,229 1,003,244 984,598 1,067,213 1,039,313 1,049,4901,174,152 1,185,626 1,219,049 1,218,220 1,223,048 1,250,814

- - - - - - 1,757,457 1,772,490 1,629,333 1,684,157 1,584,912 1,628,842

73,045,543 70,799,001 91,170,943 (4) 70,687,207 72,497,851 79,971,033

$ 169,072,585 $ 165,826,283 $ 189,157,508 (4) $ 178,321,120 $ 183,310,365 $ 182,086,812

$ 520,803 $ 559,612 $ 1,168,929 $ 1,200,252 $ 1,216,087 $ 1,256,131 1,875,559 1,392,569 1,212,211 1,201,938 1,050,970 1,063,539

556,050 708,595 698,198 656,235 864,235 2,507,883 1,101,054 942,495 1,163,024 232,286 1,345,184 1,663,511

405,602 644,802 3,651,110 3,164,986 3,607,380 4,083,754 - - 188,600 193,000 173,700 171,900

115,648 103,525 280,363 501,107 421,141 433,298 446,435 421,326 868,451 877,758 940,122 936,170

4,881,791 5,060,601 5,440,465 5,096,197 4,082,848 2,908,307 7,261,760 9,183,542 9,290,417 1,279,111 2,767,330 1,217,297

17,164,702 19,017,067 23,961,768 14,402,870 16,468,997 16,241,790

48,300,544 51,136,818 51,977,981 52,961,034 60,923,685 65,993,36214,123,999 14,068,617 13,969,091 14,109,921 14,415,660 14,739,5611,707,358 2,087,911 2,542,854 2,824,537 3,527,224 4,462,3372,848,845 2,894,957 2,899,935 2,894,352 3,453,789 2,798,9333,006,715 3,078,401 3,120,235 3,034,718 2,970,250 3,606,9971,949,748 2,032,894 1,986,434 2,243,510 2,368,389 2,389,856

796,651 864,245 791,462 875,557 769,038 2,026,898743,828 742,936 803,829 865,519 946,170 1,170,576967,376 1,023,102 1,031,456 994,840 1,000,120 999,622

- - - - - - 698,065 562,710 587,833 524,235 578,698 535,18517,725 95,147 884 886 933 1,646

1,021,427 1,227,391 2,363,621 3,383,428 8,647,869 6,968,88676,182,281 79,815,129 82,075,615 84,712,537 99,601,825 105,693,859

$ 93,346,983 $ 98,832,196 $ 106,037,383 $ 99,115,407 $ 116,070,822 $ 121,935,649

$ (78,862,340) $ (76,010,215) $ (74,024,797) (4) $ (93,231,043) $ (94,343,517) $ (85,873,989)3,136,738 9,016,128 (9,095,328) (4) 14,025,330 27,103,974 25,722,826

$ (75,725,602) $ (66,994,087) $ (83,120,125) (4) $ (79,205,713) $ (67,239,543) $ (60,151,163)

CITY OF FORT MYERS, FLORIDASchedule 2 - Changes in Net Position (continued)


163

2006 2007 2008 2009General RevenuesGovernmental activities:

TaxesProperty taxes $ 30,911,466 $ 42,003,527 $ 45,442,009 $ 50,344,893Public service taxes 9,695,679 10,079,097 10,409,177 10,457,952Fuel taxes 4,673,335 4,628,004 4,310,420 4,213,436Local business tax (3) - - 1,600,055 1,553,880 Franchise taxes 5,142,126 5,639,004 5,848,743 6,003,066

Intergovernmental, unrestricted 12,675,556 9,489,130 8,765,202 8,321,085Interest and investment income 3,525,314 7,290,750 6,315,299 3,942,860Miscellaneous 2,897,638 2,050,485 1,226,523 1,077,076Special Item - loss on disposal of capital assets - - 1,044,902 (2,329,858)Transfers 3,490,982 10,654,246 6,164,312 3,836,399

Total general revenues, transfers, and special item 73,012,096 91,834,243 91,126,642 87,420,789

Business-type Activities:Intergovernmental, unrestricted - 3,420 1,566 - Interest and investment income 1,381,079 1,722,726 1,266,242 1,469,320Miscellaneous 488,161 154,688 84,861 55,927Special Item - loss on disposal of capital assets - - (493,046) - Extraordinary item - loss on disposal of capital assets - (516,073) (1) - - Transfers (3,490,982) (10,654,246) (6,164,312) (3,836,399)

Total Business-type Activities (1,621,742) (9,289,485) (5,304,689) (2,311,152)

Total primary government $ 71,390,354 $ 82,544,758 $ 85,821,953 $ 85,109,637

Change in Net PositionGovernmental activities $ 25,961,365 $ 44,857,889 $ 17,497,199 $ 3,502,171Business-type activities 15,928,621 12,599,563 4,388,351 13,671,173

Total Change in Net Position $ 41,889,986 $ 57,457,452 $ 21,885,550 $ 17,173,344

(1)

(2)

2006 2007 2008 2009General Fund

Nonspendable $ 1,317,460 $ 1,314,159 $ 1,276,433 $ 1,255,036Assigned 8,485,383 8,928,426 11,136,740 13,127,595Unassigned 18,782,480 16,790,623 13,386,387 12,010,174

Total General Fund $ 28,585,323 $ 27,033,208 $ 25,799,560 $ 26,392,805

All other governmental fundsNonspendable $ 190,575 $ 460,480 $ 384,500 $ 514,102Restricted 47,662,688 115,618,756 106,438,932 98,018,804Committed - 4,609 20,755 32,209Assigned 374,998 5,103,243 10,931,232 16,840,047Unassigned - - - -

Total all other governmental funds $ 48,228,261 $ 121,187,088 $ 117,775,419 $ 115,405,162

Total Fund Balance, All Governmental Funds $ 76,813,584 $ 148,220,296 $ 143,574,979 $ 141,797,967

The City of Fort Myers implemented GASB Statement 54 in fiscal year 2011 and applied the statement retroactively to Schedule 3.

CITY OF FORT MYERS, FLORIDASchedule 3 - Fund Balances of Governmental Funds

Last Ten Fiscal Years(modified accrual basis of accounting)

Department of Cultural and Historic Affairs was created in fiscal year 2010 by transfers of Historical Homes. Note 22 in the CAFR for fiscal year ended September 30, 2007, provides an explanation on the loss on disposal of capital assets in 2007.



164

2010 2011 2012 2013 2014 2015

$ 40,719,474 $ 35,438,308 $ 34,770,474 $ 34,988,658 $ 36,692,230 $ 39,540,1779,241,071 10,141,215 10,610,314 11,043,981 11,390,495 11,128,7914,096,370 3,985,344 4,173,345 4,141,260 4,372,936 4,757,7611,509,930 1,421,050 1,611,733 2,656,676 1,566,244 1,866,3065,276,818 5,301,624 5,121,334 5,086,525 5,646,716 5,587,9856,957,210 7,079,177 7,040,744 7,483,242 8,358,062 8,707,8561,828,164 556,731 283,168 214,613 227,329 231,581

864,496 1,977,477 1,634,139 859,424 1,547,857 1,334,794- - - - - -

6,912,748 5,706,601 6,278,554 7,646,132 3,216,328 9,048,15077,406,281 71,607,527 71,523,805 74,120,511 73,018,197 82,203,401

- - - - - - 820,299 479,956 191,203 61,974 66,895 166,314

1,977,704 505,225 3,169,033 60,915 30,220 148,851- - - - - - - - - - - -

(6,912,748) (5,706,601) (6,278,554) (7,646,132) (3,216,328) (9,048,150)(4,114,745) (4,721,420) (2,918,318) (7,523,243) (3,119,213) (8,732,985)

$ 73,291,536 $ 66,886,107 $ 68,605,487 $ 66,597,268 $ 69,898,984 $ 73,470,416

$ (1,456,059) $ (4,402,688) $ (2,500,992) (4) $ (19,110,532) $ (21,325,320) $ (3,670,588)(978,007) 4,294,708 (12,013,646) (4) 6,502,087 23,984,761 16,989,841

$ (2,434,066) $ (107,980) $ (14,514,638) (4) $ (12,608,445) $ 2,659,441 $ 13,319,253

(3)

(4)

2010 2011 2012 2013 2014 2015

$ 1,271,958 $ 1,245,428 $ 663,230 $ 630,175 $ 634,617 $ 630,30512,740,333 11,382,758 10,244,081 10,068,201 2,354,553 3,174,67012,148,678 11,285,161 11,401,537 8,146,193 12,654,296 11,064,377

$ 26,160,969 $ 23,913,347 $ 22,308,848 $ 18,844,569 $ 15,643,466 $ 14,869,352

$ 514,102 $ 278,955 $ 421,457 $ 421,457 $ 273,004 $ 261,135 92,355,223 76,378,558 71,797,817 80,733,854 75,719,336 66,686,745

40,255 46,564 52,945 56,991 61,662 66,83818,442,576 19,582,124 19,598,082 4,778 2,359 2,361

(357,948) (457,579) (285,666) (145,663) (41,631) (17,646)$ 110,994,208 $ 95,828,622 $ 91,584,635 $ 81,071,417 $ 76,014,730 $ 66,999,433

$ 137,155,177 $ 119,741,969 $ 113,893,483 $ 99,915,986 $ 91,658,196 $ 81,868,785

(modified accrual basis of accounting)

CITY OF FORT MYERS, FLORIDASchedule 3 - Fund Balances of Governmental Funds (continued)

Restated per Note 25 in fiscal year 2013.

In fiscal year 2011, Local Business Tax was moved from Charges for Services-Protective Inspections to conform to the change in the StateUniform Chart of Accounts in fiscal year 2008.

Last Ten Fiscal Years



165

2006 2007 2008 2009

Revenues

Taxes $ 50,355,834 $ 63,744,859 $ 67,214,000 $ 72,460,443

Permits and fees 7,119,353 5,800,522 3,945,544 2,653,764

Intergovernmental revenue 22,971,635 12,128,101 15,152,934 14,436,061

Charges for services 3,051,386 2,463,448 2,338,282 2,049,235

Fines and forfeitures 1,564,364 1,336,678 1,746,548 1,710,236

Miscellaneous 20,814,296 42,903,188 23,565,634 11,252,513

Contributions-private source 1,042,629 1,772,843 495,302 84,019

Total Revenues 106,919,497 130,149,639 114,458,244 104,646,271

Expenditures

Current:

General government 10,002,264 12,005,049 12,899,973 12,403,450

Police 22,932,514 29,803,835 30,804,324 31,121,908

Fire 13,354,210 17,290,483 18,849,554 18,354,021

Protective inspections 2,370,527 2,891,600 2,686,967 2,736,868

Other 69,939 - 16,738 -

Physical environment 7,864,910 8,271,487 7,771,282 6,487,206

Transportation 4,337,370 3,754,163 4,044,298 4,016,411

Economic environment 10,860,506 4,198,947 4,851,521 6,548,851

Culture and recreation 2,914,911 3,392,226 3,779,986 3,984,351

Debt service:

Principal retirement 5,915,268 8,944,701 5,864,143 8,008,654

Interest and fiscal charges 4,964,219 7,198,993 6,226,430 6,413,745

Capital outlay 11,332,507 14,626,593 29,261,241 14,973,154

Total Expenditures 96,919,145 112,378,077 127,056,457 115,048,619

Excess (Deficiency) of Revenues over Expenditures 10,000,352 17,771,562 (12,598,213) (10,402,348)

Other Financing Sources (Uses)

Transfers in 29,971,744 85,420,893 42,781,199 37,706,723

Transfers out (26,480,760) (83,997,941) (35,970,875) (30,265,369)

Refunding bonds issued - 91,938,640 - -

Premiums on bonds issued - 3,624,802 - -

Payments to bond escrow agent - (44,084,776) - -

Proceeds from capital lease - - - -

Loan issuance 350,728 698,122 475,000 1,183,982

Installment purchase proceeds - - 165,165 -

Total Other Financing Sources (Uses) 3,841,712 53,599,740 7,450,489 8,625,336

Net change in fund balances $ 13,842,064 $ 71,371,302 $ (5,147,724) $ (1,777,012)

Debt service as a percentage of

noncapital expenditures 12.7% 16.5% 12.4% 14.4%

CITY OF FORT MYERS, FLORIDASchedule 4 - Changes in Fund Balances of Governmental Funds


166

2010 2011 2012 2013 2014 2015

$ 56,023,267 $ 52,034,109 $ 52,478,122 $ 53,145,080 $ 61,016,850 $ 64,285,118

7,769,030 6,715,722 6,755,761 7,313,589 3,149,666 4,594,785

15,200,316 12,780,655 24,354,437 14,800,700 12,672,281 10,450,816

1,904,872 1,978,054 6,488,602 6,371,315 6,323,264 6,666,238

1,627,787 935,618 951,174 883,510 655,683 638,039

8,967,946 8,539,044 1,751,368 1,935,388 1,961,842 2,046,053

109,246 77,893 73,892 104,916 60,419 127,963

91,602,464 83,061,095 92,853,356 84,554,498 85,840,005 88,809,012

11,127,904 9,955,159 10,762,378 9,517,063 9,926,424 10,417,815

31,927,083 31,982,530 33,177,103 35,095,897 35,933,246 38,019,221

16,175,874 18,220,477 19,397,852 20,414,983 20,157,916 20,494,102

1,805,083 1,609,798 1,614,959 1,473,063 1,455,396 1,625,700

- - - - - -

5,384,552 5,107,151 5,381,518 5,157,049 5,530,652 5,968,175

3,556,950 3,700,760 3,854,550 12,753,774 12,049,594 4,683,326

7,402,593 5,337,223 4,252,182 3,940,848 4,270,410 3,876,766

3,646,629 2,922,878 2,743,359 2,553,649 2,931,606 2,852,402

7,725,115 6,762,529 7,077,669 7,473,199 7,783,154 7,334,189

6,305,523 5,753,630 5,436,958 5,100,001 5,073,238 4,196,644

12,251,087 16,031,705 16,558,859 6,180,523 4,361,479 9,495,953

107,308,393 107,383,840 110,257,387 109,660,049 109,473,115 108,964,293

(15,705,929) (24,322,745) (17,404,031) (25,105,551) (23,633,110) (20,155,281)

35,596,761 25,864,588 31,451,250 29,111,268 37,207,922 28,086,124

(24,533,622) (18,955,051) (19,895,705) (18,581,835) (32,794,548) (17,720,254)

- - - - 39,910,000 -

- - - - 1,778,586 -

- - - - (30,726,640) -

- - - 598,621 - -

- - - - - -

- - - - - -

11,063,139 6,909,537 11,555,545 11,128,054 15,375,320 10,365,870

$ (4,642,790) $ (17,413,208) $ (5,848,486) $ (13,977,497) $ (8,257,790) $ (9,789,411)

14.8% 13.7% 13.4% 12.2% 12.2% 11.6%

CITY OF FORT MYERS, FLORIDASchedule 4 - Changes in Fund Balances of Governmental Funds (continued)


167

Assessed

Value as a Total

Tax Percentage of Direct

Year (1) Actual Value (4) Tax Rate

2005 $ 5,298,629 $ 679,982 $ 5,978,611 $ 1,877,768 $ 4,100,843 68.59% $ 5,978,777 7.2100

2006 7,457,263 751,407 8,208,670 2,272,274 5,936,396 72.32% 8,208,512 6.8000

2007 8,718,202 800,698 9,518,900 2,474,874 7,044,026 74.00% 9,518,954 6.2560

2008 8,552,631 824,237 9,376,868 2,530,069 6,846,799 73.02% 9,376,608 7.1634

2009 6,418,351 802,995 7,221,346 1,837,252 5,384,094 74.56% 7,221,156 7.4000

2010 5,052,642 765,227 5,817,869 1,477,179 4,340,690 74.61% 5,817,839 8.4000

2011 4,808,666 731,437 5,540,103 1,463,061 4,077,042 73.59% 5,540,212 8.4000

2012 5,033,514 653,918 5,687,432 1,621,546 4,065,886 71.49% 5,687,349 8.7760

2013 5,316,312 640,310 5,956,622 1,756,364 4,200,258 70.51% 5,956,968 8.7760

2014 5,978,526 606,789 6,585,315 2,028,995 4,556,320 69.19% 6,585,229 8.7760

Source: Lee County Property Appraiser

(1) Calendar year basis.(2) Allowable exemptions include the assessment differential value of capped parcels, which is more commonly known as the "Save Our Homes"

constitutional amendment.(3) Estimated actual value is calculated by dividing total taxable assessed value by assessed value as a percentage of actual value.(4) Florida Statutes require assessments at just valuation.

GO Debt Total Lee School Total Direct &

Tax Fiscal Operating Service Direct County District Overlapping

Year (1) Year Millage (2) Millage Tax Rate General Other (3) Millage Rates (4)

2005 2005/06 7.2100 0.0000 7.2100 3.9332 2.6091 7.882 21.6343

2006 2006/07 6.8000 0.0000 6.8000 3.5216 2.2909 7.012 19.6245

2007 2007/08 6.2560 0.0000 6.2560 3.6506 1.7276 6.960 18.5942

2008 2008/09 7.1634 0.0000 7.1634 3.6506 1.6328 6.868 19.3148

2009 2009/10 7.4000 0.0000 7.4000 3.6506 1.6887 7.508 20.2473

2010 2010/11 8.4000 0.0000 8.4000 3.6506 1.7715 8.015 21.8371

2011 2011/12 8.4000 0.0000 8.4000 3.6506 1.5996 7.854 21.5042

2012 2012/13 8.7760 0.0000 8.7760 3.6506 1.5822 7.584 21.5928

2013 2013/14 8.7760 0.0000 8.7760 4.1506 1.3271 7.598 21.8517

2014 2014/15 8.7760 0.0000 8.7760 4.1506 1.2866 7.416 21.6292

Source: Lee County Tax Collector

(1) Calendar year basis.(2) The City's operating millage tax rate may be increased only by a majority vote of the City Council.(3) 'Other' consists of Lee County Capital Improvement, Lee County Library Fund, Lee County All Hazards, and other Special Districts.(4) Total Direct and Overlapping Rates changed in fiscal year 2010 due to the addition of other overlapping rates.

Actual

Assessed

Value

City of Fort Myers Direct Rates Overlapping Rates

Exemptions (2)

Schedule 6 - Property Tax Rates - Direct and Overlapping GovernmentsLast Ten Fiscal Years

(per $1,000 of assessed value)

Value (3)

CITY OF FORT MYERS, FLORIDASchedule 5 - Assessed Value and Estimated Actual Value of Taxable Property

Last Ten Fiscal Years($ in thousands)


Total

Real Personal Assessed Allowable

Property Property Value

Estimated

Assessed

Total Taxable

168

Percentage of Percentage of

Taxable Total Taxable Taxable Total Taxable

Assessed Assessed Assessed Assessed

Taxpayer Valuation Rank Value Valuation Rank Value

Edison Mall Business Trust 74,166$ 1 1.63% 88,742$ 1 2.16%

Gulf Stream Isles Apartments 20,401 2 0.45%

Inland Diversified 17,302 3 0.38%

Cole Mt Fort Myers FL, LLC 15,377 4 0.34%

Deancurt Fort Myers 14,479 5 0.32%

Cypress Legends, LLC 13,056 6 0.29%

Fort Myers Imports LLC 12,841 7 0.28%

Discovery Village at the Forum 11,494 8 0.25%

SPTMRT Proerties Trust 11,447 9 0.25%

Cypress Woods Associated 10,321 10 0.23%

TGM Gulfstream 43,366 2 1.06%

Centex Homes 35,348 3 0.86%

F M Properties II LTD 31,665 4 0.77%

Stock Development 26,711 5 0.65%

KCS Plantation, LLC 26,036 6 0.63%

Treeline Preserve Developers 21,759 7 0.53%

Wal-Mart Stores East, LP 21,028 8 0.51%

Lee Memorial Health Systems 18,010 9 0.44%

City National Bank of FL TR 15,389 10 0.38% Total 200,884$ 4.42% 328,054$ 7.99%

Source: (1)Lee County Property Appraiser - 2014 Tax Roll

City of Fort Myers Budget Office - FY 2014-15 Budget Book(2) Lee County Property Appraiser - 2005 Tax Roll

City of Fort Myers CAFR, September 30, 2006

Notes: 2014 Total Taxable Assessed Value for Fiscal Year 2015 is $4,556,320.

2005 Total Taxable Assessed Value for Fiscal Year 2006 is $4,100,843.

2015 (1) 2006 (2)

CITY OF FORT MYERS, FLORIDASchedule 7 - Principal Property Taxpayers

September 30, 2015Current Year and Nine Years Ago

($ in thousands)

169

Tax Total Tax Amount Percentage Prior Years Tax Amount Percent of

Year (1) Levy Collected of Levy Collections (2) Collected Levy

2005 29,306$ 28,988$ 98.9% 325$ 29,313$ 100.0%

2006 40,352 39,816 98.7% 60 39,876 98.8%

2007 43,837 43,286 98.7% 61 43,347 98.9%

2008 48,693 47,918 98.4% (24) 47,894 98.4%

2009 39,015 38,637 99.0% 395 39,032 100.0%

2010 35,959 35,680 99.2% (77) 35,603 99.0%

2011 33,676 33,572 99.7% 1,349 34,921 103.7%

2012 35,586 35,454 99.6% (141) 35,313 99.2%

2013 36,761 36,717 99.9% 233 36,950 100.5%

2014 39,701 39,634 99.8% 158 39,792 100.2%

Source: Lee County Tax Collector

(1) Calendar year basis.(2) The Lee County Tax Collector auctions current year delinquent tax certificates in June of each year.

The County cannot reasonably provide us with delinquent taxes by year.

Collected within the Year of the Levy

CITY OF FORT MYERS, FLORIDASchedule 8 - Property Tax Levies and Collections

Last Ten Tax Years($ in thousands)

Total Collections to Date

170

Water:

Type of Customer 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Residential 1,477.5 1,312.1 1,248.3 1,231.7 1,208.9 1,186.6 1,198.4 1,188.8 1,308.0 1,303.2

Commercial 977.9 1,165.7 2,305.1 2,778.0 2,630.9 2,979.4 3,024.1 2,773.1 2,899.0 2,863.8Total 2,455.4 2,477.8 3,553.4 4,009.7 3,839.8 4,166.0 4,222.5 3,961.9 4,207.0 4,167.0

Total direct rate

per 1,000 gallons 3.42$ 3.59$ 3.31$ 3.61$ 3.93$ 4.28$ 4.28$ (1) 4.49$ 4.67$ 4.65$

Wastewater:

Type of Customer 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Residential 1,407.3 1,254.8 1,198.0 1,183.6 1,159.6 1,139.8 1,156.5 1,146.7 1,266.2 1,261.4

Commercial 681.2 643.4 645.7 670.4 669.3 668.7 665.7 671.7 677.4 707.0Total 2,088.5 1,898.2 1,843.7 1,854.0 1,828.9 1,808.5 1,822.2 1,818.4 1,943.6 1,968.4

Total direct rate

per 1,000 gallons 7.36$ 7.73$ 8.06$ 8.79$ 9.58$ 10.44$ 10.44$ (1) 10.96$ 11.40$ 13.25$

Source: City of Fort Myers Utility Billing Department

Note: The City of Fort Myers' rates change incrementally with increases in usage of volume.

(1) Fiscal year 2012 direct rates were corrected in fiscal year 2013 to reflect no rate increase from fiscal year 2011 to fiscal year 2012.

CITY OF FORT MYERS, FLORIDASchedule 9 - Water Sold by Type of Customer and Wastewater Billed by Type of Customer

Last Ten Fiscal Years(in millions of gallons)

171

Fiscal Year

2006 93,521$ 48$ 12,369$ 136,276$ 30,711$

2007 141,762 - 8,348 132,247 50,939

2008 135,459 - 8,937 127,871 74,014

2009 129,500 - 7,841 124,445 71,552

2010 123,307 - 6,079 119,005 70,144

2011 116,835 - 5,558 114,452 80,750

2012 110,062 - 5,037 136,974 82,018

2013 102,908 589 4,515 139,749 77,626

2014 108,614 702 3,994 136,497 73,162

2015 101,502 504 3,793 131,160 68,581

Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.

PercentageApplicable to

Fort Myers (1)

City of Fort Myers $ 105,799,565 100.00% $ 105,799,565

Overlapping Bonded Debt:

Lee County 233,295,000 6.57% 15,319,240

School Board 418,627,691 6.25% 26,143,319

Total Overlapping Bonded Debt 651,922,691 41,462,559

Total net direct and net overlapping bonded debt $ 757,722,256 $ 147,262,124

Sources: Lee County, Finance Division

Lee County Clerk of Court

Lee County School Board, Finance Division

City of Fort Myers Annual Budget Book

Note:

(1) See Schedule 14 for personal income and population data. Percentage of Personal Income changed in fiscal year

(2) Debt Per Capita changed in fiscal year 2010 for fiscal years 2006 to 2009 to use City data.(3) Corrected fiscal years 2006 to 2012 to report outstanding debt net of related premiums, discounts, and adjustments.(4) Calculation changed for fiscal years 2006 to 2012 due to reporting change in net outstanding debt amounts.

2010 for fiscal years 2006 to 2009 to use City data. Prior ratios were calculated with Lee County data.

(1) Calculated as a ratio of taxable valuation of property in the City of Fort Myers ($4,982,427,000) to total taxable valuation ofproperty in Lee County ($75,876,824,000).

Fort MyersNet Debt

Outstanding

Governmental Activities (3)

Utility

Bonds (3)

AmountApplicable to

Fund LoansRevenue Revolving

State

Jurisdiction

Overlapping governments are those that coincide, at least in part, with geographic boundaries of the City. Thisschedule estimates the portion of the outstanding debt of those overlapping governments that is borne by theproperty taxpayers of the City of Fort Myers. This process recognizes that, when considering the government'sability to issue and repay long-term debt, the entire burden borne by the property taxpayers should be taken intoaccount. However, this does not imply that every taxpayer is a resident, and therefore responsible for repayingthe debt, of each overlapping government.

BondsRevenue Capital

LeasesNotes

CITY OF FORT MYERS, FLORIDASchedule 11 - Direct and Overlapping Governmental Activities Debt

September 30, 2015

CITY OF FORT MYERS, FLORIDASchedule 10 - Ratio of Outstanding Debt by Type


Payable


172

Percentageof PersonalIncome (1)(4)

550$ 1,847$ -$ 5,760$ 281,082$ 12.08% 4,276$

11,219 1,024 - 5,150 350,689 13.11% 5,169

49,202 953 - 5,000 401,436 13.96% 5,844

126,395 931 - 4,845 465,509 16.86% 6,764

83,845 907 - 4,683 407,970 15.25% 5,983

60,823 882 - 4,513 383,813 19.86% 6,029

50,000 853 - 4,335 389,279 13.68% 5,824

49,472 777 - 4,149 379,785 14.18% 5,662

48,912 665 - 3,953 376,499 12.76% 5,424

48,327 599 509 3,748 358,723 11.49% 4,955

DebtPer

Capita (2)(4)

OtherProprietary


Government (1)(3)

Primary TotalOther

Revenue Bonds (3)

CapitalDebtLeases

OtherUtilityDebt (3)

CITY OF FORT MYERS, FLORIDASchedule 10 - Ratio of Outstanding Debt by Type (continued)


173

Excess GuaranteedFiscal Utilities Communications Entitlement Franchise Local BusinessYear Tax Tax Funds Taxes Tax

2006 5,507$ 4,189$ 893$ 5,088$ 1,755$

2007 5,765 4,314 893 5,585 1,825

2008 5,727 4,682 893 5,794 1,642

2009 5,923 4,378 893 5,949 1,616

2010 6,338 3,571 893 5,223 1,568

2011 6,471 3,557 893 5,248 1,465

2012 6,694 4,064 893 5,072 1,651

2013 7,261 3,913 893 5,028 1,693

2014 8,048 3,342 893 5,433 1,745

2015 8,285 2,844 893 5,521 1,909

Note: Debt service coverage is based on pledged revenues and annual debt service. (1) Added Interest to the Debt Service requirements in fiscal year 2010 for fiscal years 2006 to 2009.

Excess GuaranteedFiscal Utilities Communications Entitlement Franchise Local Business

Year Tax Tax Funds Taxes Tax

2006 5,507$ 4,189$ 893$ 5,088$ 1,755$

2007 5,765 4,314 893 5,585 1,825

2008 5,727 4,682 893 5,794 1,642

2009 5,923 4,378 893 5,949 1,616

2010 6,338 3,571 893 5,223 1,568 2011 6,471 3,557 893 5,248 1,465

2012 6,694 4,064 893 5,072 1,651

2013 7,261 3,913 893 5,028 1,693

2014 8,048 3,342 893 5,433 1,745

2015 8,285 2,844 893 5,521 1,909

Note: Bond coverage is based on the bond document calculation.

Tax Increment Maximum

Fiscal Financing Principal and Bond

Year Revenues Interest Coverage

2006 3,261$ 4,556$ 0.72

2007 4,912 4,556 1.08

2008 5,457 4,556 1.20

2009 7,633 4,556 1.68

2010 5,117 735 6.96

2011 2,899 718 4.04

2012 2,496 698 3.58

2013 2,780 678 4.10

2014 2,942 658 4.47

2015 3,226 637 5.06

(1) Recalculated Maximum Principal and Interest, based on maximum per fiscal year, in fiscal year 2010 for fiscal years 2006 to2008. Prior calculations were based on maximum per bond year.(2) Recalculated Bond Coverages in fiscal year 2010 due to the change in Maximum Principal and Interest for fiscal years 2006 to2008.

General Revenue Bonds

General Revenue Bonds

(2) Recalculated Bond Coverage for fiscal years 2006 to 2009 due to the addition of Interest to the Debt Service requirements infiscal year 2010.

Community Redevelopment Revenue Note, Series 2005

CITY OF FORT MYERS, FLORIDASchedule 12 - General Revenue Bonds - Pledged Revenue Coverage

Last Ten Fiscal Years ($ in thousands)

174

TotalHalf-Cent Pledged BondSales Tax Revenues Principal Coverage (2)

5,924$ 23,356$ 4,475$ 3,604$ 2.89

5,531 23,913 4,395 4,564 2.67

4,802 23,540 4,445 4,964 2.50

4,169 22,928 4,310 5,242 2.40

4,184 21,777 5,674 5,032 2.03

4,404 22,038 4,686 4,810 2.32

4,282 22,656 4,965 4,575 2.37

4,660 23,448 5,370 4,320 2.42

5,217 24,678 5,630 4,047 2.55

5,613 25,065 6,415 4,197 2.36

Total MaximumHalf-Cent Pledged Principal and Bond

Sales Tax Revenues Interest (1) Coverage (2)

5,924$ 23,356$ 8,079$ 2.89

5,531 23,913 9,690 2.47

4,802 23,540 9,690 2.43

4,169 22,928 10,706 2.14

4,184 21,777 10,706 2.034,404 22,038 9,690 2.27

4,282 22,656 9,690 2.34

4,660 23,448 9,677 2.42

5,217 24,678 11,147 2.21

5,613 25,065 11,088 2.26

Debt Service

Schedule 12 - General Revenue Bonds - Pledged Revenue Coverage (continued)

General Revenue Bonds (continued)

General Revenue Bonds (continued)

Interest (1)


($ in thousands)Last Ten Fiscal Years

175

Coverage based on current year results and not calculated according to the bond documents.

Fiscal

Year

2006 $ 44,728 $ 27,071 $ 17,657 $ 1,267 $ 18,924

2007 42,899 29,723 13,176 1,761 14,937

2008 43,579 32,232 11,347 1,228 12,575

2009 45,692 33,194 12,498 52 12,550

2010 48,301 32,822 15,479 - 15,479

2011 51,137 32,594 18,543 - 18,543

2012 51,978 34,034 17,944 - 17,944

2013 52,961 34,941 18,020 - 18,020

2014 60,924 36,010 24,914 - 24,914

2015 65,993 40,264 25,729 - 25,729

Coverage calculated according to the bond documents for coverage and additional bonds test.

Fiscal

Year

2006 $ 44,056 $ 26,291 $ 17,765 $ 5,746 $ 23,511

2007 41,588 26,536 15,052 5,038 20,090

2008 43,548 30,371 13,177 5,980 19,157

2009 46,069 30,262 15,807 9,453 25,260

2010 48,752 26,203 22,549 8,647 31,196

2011 51,433 25,862 25,571 9,380 34,951

2012 52,008 26,891 25,117 9,410 34,527

2013 53,039 27,320 25,719 9,389 35,108

2014 58,558 28,381 30,177 9,923 40,100

2015 62,555 32,339 30,216 10,643 40,859

(1) In fiscal year 2010, the basis for Maximum Debt Service changed from bond year to fiscal year for fiscal years 2006 to 2009.

Note: Corrected prior years for consistency in interpretation of bond documents.

Revenues

Operating

Total

Documents

Per Bond

Adjustments

Revenues

Operating

Expenses Debt Service

Operating

Total Revenues

Available for

Net

Net Operating

AvailableRevenues

Operating

Revenues

Impact FeesUtility

Revenues

Note: Corrected prior years for consistency in interpretation of bond documents.

Expenses

Pledged TotalAvailable

Net Operating

Gross Direct

Schedule 13 - Water-Wastewater Utility - Pledged Revenue Coverage Last Ten Fiscal Years

($ in thousands)


176

Utility Bonds

and Notes

Coverage

$ 6,040 $ 5,948 1.58 $ 649 1.50

5,105 6,747 1.26 1,436 1.12

5,340 6,560 1.06 2,177 0.89

5,405 8,647 0.89 5,174 0.65

4,050 8,344 1.25 5,971 0.84

5,600 8,362 1.33 6,335 0.91

5,865 7,184 1.38 6,450 0.92

2,738 7,651 1.73 6,451 1.07

4,459 7,822 2.03 6,453 1.33

6,460 7,633 1.83 6,453 1.25

Coverage Coverage

Total Total

Revenues Revenues

Available Debt Service

$ 1,267 $ 24,778 $ 12,842 1.83 1.93 $ 3,978 3.00

1,761 21,851 12,842 1.56 1.70 5,409 1.67

1,228 20,385 12,842 1.49 1.59 5,602 1.35

52 25,312 15,875 1.59 1.59 5,694 1.66

- 31,196 15,781 1.98 1.98 7,004 2.20

- 34,951 16,083 2.17 2.17 6,815 2.77

- 34,527 16,271 2.12 2.12 6,453 2.83

- 35,108 16,499 2.13 2.13 6,453 2.88

- 40,100 16,271 2.46 2.46 6,453 3.69

- 40,859 16,271 2.51 2.51 6,453 3.81

Debt

Service (1) Debt ServiceDebt Service

Available for

Debt Service

Available for

Debt Service

Total

RevenuesImpact Fees

State

Loan Maximum

Revolving

Available for

NOR

Coverage

Maximum

Debt Service

Interest Coverage Debt Service

Revolving Loan State

Bonded

Principal

CITY OF FORT MYERS, FLORIDASchedule 13 - Water-Wastewater Utility - Pledged Revenue Coverage (continued)

Last Ten Fiscal Years ($ in thousands)

177

Total Personal

City of Lee Income Per Capita Labor Unemployment

Year Fort Myers (2) County (3) (in thousands) (4) Income (5) Force (6) Unemployed (6) Rate (6)

2006 65,729 585,608 20,736,965$ 33,073$ 278,098 6,823 2.5%

2007 67,851 615,741 24,266,353 39,410 295,730 15,344 5.2%

2008 68,689 623,725 26,111,623 41,864 284,605 26,200 9.2%

2009 68,819 615,124 24,674,348 41,954 272,069 37,789 13.9%

2010 62,298 618,754 1,422,762 22,838 30,049 3,378 11.2%

2011 63,662 625,310 1,465,062 23,517 29,786 3,034 10.2%

2012 66,835 638,029 1,570,288 23,495 28,211 2,436 8.6%

2013 67,081 643,367 1,579,154 23,541 28,885 1,928 6.7%

2014 69,413 653,485 1,569,566 22,612 30,728 1,746 5.7%

2015 72,395 665,845 1,645,104 22,724 30,300 1,574 5.2%

2020 79,435 666,270

Sources: (1) City of Fort Myers statistics not available until 2010.(2) Lee County Economic Development (2006).

Office of Economic and Demographic Research - Edr.state.fl (2007-2009). Population is projected.

US Census Bureau (2010).

Bureau of Economic and Business Research, University of Florida (2011-2015). Population is projected.(3) Lee County Planning Department (2006).

Office of Economic and Demographic Research - Edr.state.fl (2007-2009). Population is projected.

US Census Bureau (2010).

Bureau of Economic and Business Research, University of Florida (2011-2015). Population is projected.(4) Bureau of Economic and Business Research Population for Counties and Municipalities Revenue (2006).

Lee County, Florida, Comprehensive Annual Financial Report, Demographic Statistics (2007-2009).

City of Fort Myers, Geographic Information Systems (2010-2015). Total personal income is estimated.(5) Bureau of Economic and Business Research, Woods & Poole MSA Profile; Sales and Marketing (2006).

Lee County, Florida, Comprehensive Annual Financial Report, Demographic Statistics (2007-2009).

City of Fort Myers, Geographic Information Systems (2010-2015). Per capita income is estimated.(6) Florida Department of Labor and Employment, Division of Labor, Employment and Training (2006).

Florida Agency for Workforce Innovation, Labor Market Statistics Center (2007-2009).

Florida Department of Economic Opportunity (2010-2015).(7) City of Fort Myers, Geographic Information Systems

Lee County (1)Population

As Projected (7)

City of Fort Myers (1)

CITY OF FORT MYERS, FLORIDASchedule 14 - Demographic and Economic Statistics


178

Percentage of Percentage of

Total County Total County

Employer Employees Rank Employment Employees Rank Employment

Lee Memorial Health System 10,900 1 3.52% 8,000 2 3.45%

Lee County School District 10,600 2 3.43% 10,930 1 4.72%

Publix Super Markets 5,007 3 1.62% 4,153 3 1.79%

Lee County Administration 2,584 4 0.84% 2,481 4 1.07%

Wal-Mart Corporation 2,507 5 0.81% 2,189 5 0.94%

Home Depot 1,783 6 0.58%

City of Cape Coral 1,654 7 0.53% 1,948 6 0.84%

Chico's FAS, Inc. 1,642 8 0.53%

Lee County Sheriff's Office 1,585 9 0.51% 1,422 7 0.61%

U.S. Postal Service 1,477 10 0.48% 1,397 9 0.60%

Bonita Bay Group 1,400 8 0.60%

Florid Gulf Coast University 1,040 10 0.45%

Total 39,739 12.85% 34,960 15.07%

Source: Lee County Office of Economic Development, Florida Research and Economic Database, and U.S. Bureau of Labor Statistics.

(1) The information provides Lee County statistics since statistics for the City of Fort Myers are not available. (2) As of July 2015.

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Function

General Government 132.0 145.0 145.9 143.6 119.6 114.0 114.0 114.0 117.0 116.5

Public Safety 494.1 529.3 530.1 511.7 412.5 427.4 427.4 426.9 436.8 436.6

Physical Environment 274.9 298.4 302.1 295.9 259.7 253.8 253.8 253.8 252.5 254.9

Transportation 24.5 24.5 24.60 22.6 18.6 19.0 19.0 19.0 19.0 19.0

Culture/Recreation 160.8 111.8 123.3 122.4 103.6 100.3 103.4 104.9 103.4 103.0

Community Development 13.1 20.6 17.50 17.4 14.0 13.4 13.4 13.9 13.9 13.9Total 1,099.4 1,129.6 1,143.5 1,113.6 928.0 927.9 931.0 932.5 942.6 943.9

Source: City of Fort Myers Budget Office.

Note: In fiscal year 2011, the data was expanded to reflect the accurate ratio of full-time positions.

2015 (2) 2006

CITY OF FORT MYERS, FLORIDASchedule 16 - Full-Time Equivalent Government - Employees by Function/Program


LEE COUNTY, FLORIDASchedule 15 - Principal Employers (1)

September 30, 2015Current Year and Nine Years Ago

179

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Function/Program

Police

Number of police personnel and officers 193 203 244 257 268 264 250 250 251 262

Physical arrests 7,288 6,561 6,920 5,398 5,697 5,498 5,844 5,829 5,381 3,424 (8)

Traffic violations 17,921 17,991 15,655 10,213 20,964 18,463 24,602 20,623 19,253 14,587 (9)

Parking violations 8,455 6,861 5,974 7,616 6,976 7,400 8,232 7,373 7,000 (4) 15,238 (10)

Fire

Number of fire personnel and officers 115 126 126 121 120 149 142 140 140 121

Number of calls answered 16,071 14,957 13,983 14,690 14,725 15,793 15,933 15,592 14,250 10,847 (7)

Number of inspections conducted 5,446 4,609 6,102 5,405 3,452 3,429 2,943 3,375 3,969 3,366

Solid Waste

Commercial MSW (tonnage) 37,092 33,606 31,733 29,607 28,325 30,997 31,802 29,742 28,946 32,735

Residential MSW (tonnage) 17,219 15,705 12,060 8,488 7,952 5,588 5,359 8,442 9,916 8,781

Roll-Off Debris (tonnage) 5,583 6,891 14,245 14,949 15,307 15,075 14,945 16,398 16,748 17,639

Recycling (tonnage) - - - - - - - 4,014 4,300 4,699

Culture and RecreationCity Recreation Venues (3)

337,801 573,023 663,430 555,145 990,185 1,056,291 1,188,389 1,073,336 900,826 579,642

Water system

Number of service connections 18,598 18,893 20,194 20,576 21,010 21,365 22,193 22,919 23,132 23,692

Daily average finished flow in gallons 6,878,000 7,524,000 6,601,376 6,129,000 6,020,000 6,024,910 6,042,200 6,326,401 6,820,250 6,880,750

Maximum daily capacity of plants, in

gallons 9,404,000 9,438,000 12,000,000 (2) 12,000,000 12,000,000 12,000,000 12,000,000 12,000,000 12,000,000 12,000,000

Wastewater system

Number of service connections 16,627 16,949 16,394 16,552 16,690 16,859 17,530 18,680 21,058 21,351

Daily average treatment in gallons 17,532,500 14,610,000 15,544,000 14,230,000 14,857,000 13,710,000 14,540,000 14,890,000 11,648,000 (5) 14,810,000

Maximum daily capacity of treatment

plants, in gallons 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000 23,000,000

Building, Permits, and Inspection

Building permits issued 8,085 7,705 5,358 4,122 4,941 5,323 5,836 6,548 7,465 8,916

Golf Courses

Number of rounds per year, Eastwood 58,929 39,279 (1) 48,048 (1) 56,399 55,327 56,117 52,196 54,920 59,741 56,466

Number of rounds per year, Fort Myers 65,434 76,828 67,169 57,905 55,625 55,444 52,335 53,565 38,930 (6) 58,756

Sources: Various city departments

(1) In fiscal years 2007 and 2008, Eastwood Golf Course was closed due to renovations, which led to a temporary increase at the Fort Myers Country Club.(2) Water Plant enhancement(3) Includes City community centers, athletics and aquatics venues, and special events.(4) Reporting period January 2014 to September 2014.(5) Less influent from Lee County to South Plant, also lower rainfall than normal in 2014.(6) Fort Myers Country Club closed five months for renovations, which led to a temporary increase at the Eastwood Golf Course.(7) Decrease due to low acuity call types dispatched by 911 as an EMS only response, not requiring the additional response by Firefighters.(8) Decline due to change in reporting software.

Schedule 17 - Operations Indicators by Function/ProgramCITY OF FORT MYERS, FLORIDA


Note: In fiscal year 2013, the City changed this schedule to enhance the reporting of Operating Indicators. Therefore, the Capital Assets Statistics reported in previous fiscal years'Schedule 17 transferred to Schedule 18.

180

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Function/programGeneral Government

Number of Enterprise Center buildings 2 2 2 2 2 2 2 2 2 2Number of Facility Management vehicles 13 13 14 14 14 14 14 13 12 14

PoliceNumber of stations 4 2 2 2 2 2 2 2 2 2Number of patrol vehicles 91 100 113 120 120 120 114 111 109 111Number of unmarked vehicles 43 43 43 43 43 43 43 43 43 43Number of pickup trucks 4 4 4 4 4 4 4 4 4 4Number of vans 6 6 6 6 6 6 6 6 6 6Number of motorcycles 0 0 0 2 2 2 2 2 2 2Number of boats 1 1 1 1 1 1 1 1 1 1Number of boat trailers 1 1 1 1 1 1 1 1 1 1Number of VIP units 3 3 3 3 3 3 3 3 3 3Mobile command post 1 1 1 1 1 1 1 1 1 1ERV (MCOPS vehicle) 1 1 1 1 1 1 1 1 1 1Hostage negotiator truck 1 1 1 1 1 1 1 1 1 1

FireNumber of stations 5 6 6 6 6 6 6 6 6 6Number of fire fighting units 9 10 10 10 10 10 10 10 11 11Number of rescue units 2 2 2 2 2 2 2 2 2 2Number of marine units 2 2 2 2 2 2 2 2 2 2Number of support/specialty units 5 5 5 5 5 5 5 5 5 5

Culture and RecreationNumber of community centers 5 5 5 3 3 3 3 3 3 3Number of parks 28 29 30 34 35 35 35 35 35 35Park acreage (including golf courses) 504 505 507 451 451 537 (2) 537 (2) 537 (2) 537 537Number of swimming pools 4 4 4 4 4 4 4 4 4 4Number of tennis courts 16 16 16 16 16 16 16 16 16 16Number of skate parks 1 1 1 1 1 1 1 1 1 1

Public WorksNumber of Public Works buildings n/a n/a n/a n/a n/a n/a n/a 132 132 132Miles of City maintained streets 260 272 240 (1) 240 240 240 240 240 240 240Number of street lights 9,500 9,850 10,346 10,346 10,346 10,346 10,346 10,346 10,346 10,346Number of bridges n/a n/a n/a n/a n/a n/a n/a 16 27 (5) 27Number of culverts n/a n/a n/a n/a n/a n/a n/a 12 12 12

Sewer systemMiles of sanitary sewers 328 337 372 388 400 406 410 410 422 422Number of sewer treatment plants 2 2 2 2 2 2 2 2 2 2

Water systemNumber of water treatment plants 1 1 1 1 1 1 1 1 1 1Miles of water mains 344 378 383 397 413 441 453 458 469 469Number of fire hydrants 1,500 3,483 3,644 4,600 4,600 3,185 (3) 3,188 (3) 3,188 (3) 3,231 3,231

Stormwater Miles of storm drainage pipes n/a n/a n/a n/a n/a n/a n/a 139 139 139Number of catch basins n/a n/a n/a n/a n/a n/a n/a 831 844 844

Solid WasteNumber of refuse collection vehicles 42 43 39 39 38 37 38 41 44 46

Golf CoursesNumber of golf courses 2 2 2 2 2 2 2 2 2 2Number of holes 36 36 36 36 36 36 36 36 36 36

Yacht Basin/MarinaNumber of slips 296 296 296 296 296 295 295 284 284 284Number of non-transient boats docked (4 145 145 140 135 130 130 130 147 140 145

CITY OF FORT MYERS, FLORIDASchedule 18 - Capital Asset Statistics by Function


(continued)

181

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Function/programDowntown Parking Garages

Number of parking garages 2 2 2 2 2 2 2 2 2 2

Harborside Event CenterNumber of event center buildings 1 1 1 1 1 1 1 1 1 1

Cultural and Historic AffairsNumber of buildings 4 4 4 4 4 4 4 4 4 4

Sources: Various city departments

(1)

(2)Fluctuation from fiscal year 2010 to 2011 based on GPS enhancements available in fiscal year 2011.In fiscal year 2014, acreage corrected for fiscal years 2011 - 2013 to remove the inclusion of wellfield acres for the golf courses.

(3)

(4)Description updated for non-transient boats (leases longer than thiry days)

(5)Updated in fiscal year 2014, based on current GIS data.

Corrected to report only City maintained roads. Previous data included all roads, some of which were federal and state roads.

In fiscal year 2014, hydrants corrected for fiscal years 2011 - 2013 to remove the inclusion of hydrants owned and maintained privately or by Lee County.

Note: In fiscal year 2013, the City changed this schedule to provide more details on Capital Assets Statistics. Previous fiscal years' Schedule 18 reported number ofassets by function.

CITY OF FORT MYERS, FLORIDASchedule 18 - Capital Asset Statistics by Function

Last Ten Fiscal Years (continued)

182

Single Audit Report



INDEPENDENT AUDITORS’ 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 Fort Myers, Florida Fort Myers, Florida 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 Fort Myers, Florida (City), as of and for the year ended September 30, 2015, and the related notes to the financial statements, which collectively comprise City’s basic financial statements, and have issued our report thereon dated March 18, 2016. Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered City'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’s internal control. Accordingly, we do not express an opinion on the effectiveness of City’s internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as described in the accompanying schedule of findings and questioned costs, we identified certain deficiencies in internal control that we consider to be material weaknesses. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies described as item 2015-001 in the accompanying schedule of findings and questioned costs to be material weaknesses.

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Compliance and Other Matters

As part of obtaining reasonable assurance about whether City'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. City’s Response to Findings

The City’s response to the findings identified in our audit are described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. 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 result 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.



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INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133

Honorable Mayor and City Council City of Fort Myers, Florida Fort Myers, Florida Report on Compliance for Each Major Federal Program

We have audited the City of Fort Myers, Florida’s (City) 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 the City’s major federal programs for the year ended September 30, 2015. The City’s major federal programs are identified in the summary of auditors’ 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. Auditors’ Responsibility

Our responsibility is to express an opinion on compliance for each of the City’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 the City’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 the City’s compliance. Opinion on Each Major Federal Program

In our opinion, the City 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 September 30, 2015.

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Report on Internal Control Over Compliance

Management of the City 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 the City’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 the City’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 and therefore, material weaknesses or significant deficiencies may exist that were not identified. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, we identified certain deficiencies in internal control over compliance, as described in the accompanying schedule of findings and quested costs as item 2015-002, that we consider to be a significant deficiency. The City’s response to the internal control over compliance finding identified in our audit is described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the auditing procedures applied in the audit of compliance, and accordingly, we express no opinion to the response. 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 result of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose.



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CITY OF FORT MYERS, FLORIDASchedule of Expenditures of Federal AwardsFor the Year Ended September 30, 2015

FEDERAL FEDERAL ORCFDA Passed through TOTAL TRANSFER TO

FUNDING AGENCY / GRANT NAME NUMBER GRANT NUMBER EXPENDITURES SUBRECIPIENTS

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENTCommunity Development Block Grant / Entitlement Grant Cluster

Community Development Block Grant (CDBG) 14.218 B-13-MC-12-0006 494,375$ 88,349$ Neighborhood Stabilization Program 1 (NSP1) 14.218 B-08-MN-12-0008 6,599 3,900 Neighborhood Stabilization Program 1 (NSP1) 14.218 Program Income 17,761 - Neighborhood Stabilization Program 3 (NSP3) 14.218 B-11-MN-12-0008 - 4,300 Neighborhood Stabilization Program 3 (NSP3) 14.218 Program Income 77,860 -

Total Community Development Block Grant / Entitlement Grant Cluster 14.218 Total 596,595 96,549

Total U.S. Department of Housing and Urban Development 596,595 96,549

U.S. DEPARTMENT OF THE INTERIORPassed through Florida Department of Environmental Protection

Land and Water Conservation Fund Grant Ford Street Preserve at Shady Oaks Park 15.916 LW580 103,889

Total U.S. Department of the Interior 103,889

U.S. DEPARTMENT OF JUSTICENational Institute of Justice Research, Evaluation,

and Development Project Grants 16.560 2014-DN-BX-K068 100,755

Bulletproof Vest Partnership Grant FY 2015 16.607 None 9,300

Edward Byrne Memorial Justice Assistance Grant ProgramEdward Byrne Memorial Justice Assistance Grant Program FY 2014-2017 16.738 2014-DJ-BX-0306 55,689

Passed through Florida Department of Law Enforcement

Edward Byrne Memorial Justice Assistance Grant - Countywide 16.738 2015-JAGC-LEE-6-R3-108 22,290

16.738 Total 77,979 Total U.S. Department of Justice 188,034

U.S. DEPARTMENT OF TRANSPORTATIONNational Highway Traffic Safety Administration (NHTSA)Passed through State of Florida, Department of Transportation (FDOT)

State and Community Highway Safety Aggressive Driving Enforcement & Education Program 20.600 SC-15-13-06 60,730

Total U.S. Department of Transportation 60,730

U.S. ENVIRONMENTAL PROTECTION AGENCYPassed through Florida Department of Environmental Protection

Nonpoint Source Implementation Grant - 319 Program Ford Street Preserve at Shady Oaks Park 66.460 G0345 600,465

Total U.S. Environmental Protection Agency 600,465

U.S. DEPARTMENT OF HOMELAND SECURITYPassed through Florida Division of Emergency Management

Disaster Grants - Public Assistance (Presidentially Declared Disasters) 97.036 FEMA-4068-DR-FL 6,156

Hazard Mitigation Grant - HMGP Dean Park Neighborhood Improvements 97.039 14HM-2V-09-46-02-425 515,737

State Homeland Security Grant Program 97.067 14DS-L5-09-46-01-399 2,397 State Homeland Security Grant Program 97.067 15-DS-P4-09-46-02-403 12,597

97.067 Total 14,994

Staffing for Adequate Fire and Emergency Response - Hiring Program - FEMA 2012 97.083 EMW-2012-FH-00249 1,089,655

Total U.S. Department of Homeland Security 1,626,542

TOTAL EXPENDITURES OF FEDERAL AWARDS 3,176,255$ 96,549$

Note: The Schedule of Expenditures of Federal Awards is prepared on the modified accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

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CITY OF FORT MYERS, FLORIDASchedule of Expenditures of State Financial AssistanceFor the Year Ended September 30, 2015

STATECSFA STATE TOTAL TRANSFER TO

FUNDING AGENCY / GRANT NAME NUMBER GRANT NUMBER EXPENDITURES SUBRECIPIENTS

FLORIDA DEPARTMENT ENVIRONMENTAL PROTECTION

Statewide Surface Water Restoration and Wastewater

Projects - Carrell Canal Water Quality Retrofit 37.039 S0713 258,212$ -$ Total Florida Department of Environmental Protection 258,212

FLORIDA DEPARTMENT OF STATE AND SECRETARY OF STATE

Division of Historical Resources -

Acquisition, Restoration of Historic Properties -

McCollum Hall 45.032 MP507 28,577

Total Florida Department of State and Secretary of State 28,577

FLORIDA HOUSING FINANCE CORPORATION

State Housing Initiatives Partnership Program 52.901 None 110,473

Total Florida Housing Finance Corporation 110,473

FLORIDA DEPARTMENT OF TRANSPORTATION

Florida Highway Beautification Council - SR 80 (Palm Beach Boulevard) from Seaboard Street 55.003 433827-1-74-01 71,000

Total Florida Department of Transportation 71,000

FLORIDA DEPARTMENT OF JUVENILE JUSTICE

Delinquency Prevention - Truancy Assistance Program 80.029 10021 17,138 15,979

Total Florida Department of Juvenile Justice 17,138 15,979

TOTAL EXPENDITURES OF STATE FINANCIAL ASSISTANCE 485,400$ 15,979$

Note: The Schedule of Expenditures of Federal Awards is prepared on the modified accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

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CITY OF FORT MYERS, FLORIDA SCHEDULE OF FINDINGS AND QUESTIONED COSTS

YEAR ENDED SEPTEMBER 30, 2015

Section I – Summary of Auditors’ Results

Financial Statements

1. Type of auditors’ report issued: Unmodified

2. Internal control over financial reporting:

Material weakness(es) identified? X yes no

Significant deficiency(ies) identified that are not considered to be material weakness(es)? yes X none reported

3. Noncompliance material to financial

statements noted? yes X no Federal Awards

1. Internal control over major federal programs:

Material weakness(es) identified? yes X no

Significant deficiency(ies) identified that are not considered to be material weakness(es)? X yes no

2. Type of auditors’ report issued on compliance for major federal programs: Unmodified

3. Any audit findings disclosed that are required

to be reported in accordance with section 510(a) of OMB Circular A-133? X yes no

Identification of Major Federal Programs CFDA Number(s) Name of Federal Program or Cluster 14.218 Community Development Block Grant/Entitlement

Grant Cluster 66.460 Nonpoint Source Implementation Grant 97.039 Hazard Mitigation Grant - HMGP Dollar threshold used to distinguish between Type A and Type B programs: $ 300,000 Auditee qualified as low-risk auditee pursuant to OMB Circular A-133? X yes no

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Section II – Financial Statement Findings

2015-001 Type of Finding:

Material Weakness in Internal Control over Financial Reporting

Criteria: The City’s solid waste tipping fee is comprised of the tipping fee charged by Lee County plus a surcharge. Management is responsible for updating the City’s solid waste tipping fee upon changes in tipping fees made by Lee County. Condition: Lee County decreased its solid waste tipping fees in fiscal years 2013 and 2014. The City did not update the rates in their billing system resulting in overcharging customers for the fiscal years ending September 30, 2013 and 2014. Context: A sample of eight manual journal entries were selected for testing from a population of 1,408 that were recorded for the year ended September 30, 2015. One entry selected was deemed to have been recorded incorrectly. Effect: At September 30, 2015, the City recorded an accrued liability of $287,857 and a prior period adjustment for the amount of solid waste tipping fee overcharges owed to customers for the fiscal years ending September 30, 2013 and 2014. Cause: During the fiscal year ending September 30, 2013, the City segregated the Solid Waste and Utility departments and experienced management turnover. Recommendation: We recommend that management implement written policies and procedures to review and ensure authorized rates are entered into the billing system annually. Views of responsible officials and planned corrective actions: Management concurs with the description of prior period adjustment and the auditors’ recommendation. Public Works will implement a written policy to formalize the timing of the entry of authorized rates into the billing system and ensure a tiered review of the rate changes, to include final approval by the Public Works Director. In addition, Utility Billing supervisors will perform an audit after the first billing with new rates to ensure accuracy of the billings to customers.

Section III – Findings and Questioned Costs – Major Federal Programs 2015-002 Federal agency: U.S. Department of Homeland Security

Federal program: Hazard Mitigation Grant - HMGP

CFDA Number: 97.039

Florida Division of Emergency Management

14HM-2V-09-46-02-425

Award Period: 2014/2015

Type of Finding: Significant Deficiency in Internal Control over Compliance

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Criteria or specific requirement: If the grantee subcontracts any work required under this grant agreement, a copy of the unsigned contract must be forwarded to the grantor for review and approval before it is executed by the grantee. The City is required to include certain terms within the contract as defined by the grant agreement and ensure the subcontractor is not suspended or debarred. Condition: The City did not obtain prior approval of the subcontractor as required by the grant agreement. Questioned costs: Unknown Context: The auditors selected one of two subcontractors awarded under the grant and noted for the selection tested, prior approval was not obtained. Cause: The City did not comply with the terms of the grant agreement. Effect: The prior approval of the subcontractor agreement would reduce the chance of not being in compliance with the grant agreement. Recommendation: The City should implement procedures to ensure that all individuals responsible for the administration of the grants are trained to identify and monitor compliance with all grant requirements. Views of responsible officials and planned corrective actions:

Explanation of disagreement with audit finding: There is no disagreement with the audit finding.

Actions planned in response to finding: All Public Works project managers will be trained in grant compliance. This training will include procedures that must be adhered to complete a project that has any type of grant or external agency funding. A project cannot be assigned to a project manager who has not been trained in grant compliance. The training will be based on the City of Fort Myers Grants Guidebook, which is a compilation of coursework, webinars, and conferences attended by the Contracts and Grants Specialist of the Public Works Department.

Responsible party: Amber Smith, City of Fort Myers Contracts and Grants Specialist

Planned completion date for corrective action plan: Training of current employees for grant compliance will begin on March 30, 2016. There will be an annual refresher course given during the 2nd quarter of each year.

Plan to monitor completion of corrective action plan: Each participant of the training will receive a certificate of completion. The Public Works Director will not assign a project to any project manager who has not completed the training.

Section IV – Prior Year Major Federal Program Findings There were no findings in the prior year that were required to be reported in accordance with Section 510(a) of OMB Circular A-133.

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Management Letter



MANAGEMENT LETTER Honorable Mayor and City Council City of Fort Myers, Florida Fort Myers, Florida Report on the Financial Statements

We have audited the financial statements of the City of Fort Myers, Florida (City), as of and for the fiscal year ended September 30, 2015, and have issued our report thereon dated March 18, 2016. Auditors’ Responsibility

We conducted our audit 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; OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations; and Chapter 10.550, Rules of the Auditor General. Other Reports and Schedule

We have issued our Independent Auditors’ Report on Internal Control over Financial Reporting and Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; Independent Auditors’ Report on Compliance for Each Major Federal Program and Report on Internal Control over Compliance; Schedule of Findings and Questioned Costs; and Independent Accountants’ Report on an examination conducted in accordance with AICPA Professional Standards, Section 601, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports and schedule, which are dated March 18, 2016, should be considered in conjunction with this management letter. Prior Audit Findings

Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Official Title and Legal Authority

Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. The City discloses this information in the notes to the financial statements.

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Financial Condition

Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require that we apply appropriate procedures and report the results of our determination as to whether or not the City has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and identification of the specific condition(s) met. In connection with our audit, we determined that the City did not meet any of the conditions described in Section 218.503(1), Florida Statutes.

Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures. It is management’s responsibility to monitor the City’s financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same.

Annual Financial Report

Section 10.554(1)(i)5.b. and 10.556(7), Rules of the Auditor General, require that we apply appropriate procedures and report the results of our determination as to whether the annual financial report for the City for the fiscal year ended September 30, 2015, filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal year ended September 30, 2015. In connection with our audit, we determined that these two reports were in agreement.

Special District Component Units

Section 10.554(1)(i)5.d., Rules of the Auditor General, requires that we determine whether or not a special district that is a component unit of a county, municipality, or special district, provided the financial information necessary for proper reporting of the component unit, within the audited financial statements of the county, municipality, or special district in accordance with Section 218.39(3)(b), Florida Statutes. The City does not have any special district component units.

Other Matters

Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. Our current year recommendations are listed in Appendix A to this Management Letter.

Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings.

Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, federal and other granting agencies, the City Council, and applicable management, and is not intended to be, and should not be, used by anyone other than these specified parties.

CliftonLarsonAllen LLP Fort Myers, Florida March 18, 2016

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CITY OF FORT MYERS, FLORIDA MANAGEMENT LETTER SEPTEMBER 30, 2015

APPENDIX A – CURRENT YEAR FINDINGS AND RECOMMENDATIONS

2015-003 Purchase Cards (Pcards) – Signed Authorization Forms Criteria

As per the City’s purchase card policy, the department head will sign the Purchase Card authorization form.

Condition

Of the sample of 27 purchase cards selected for testing, the files for six employees issued a purchase card were missing the signed authorization form.

Cause

The purchasing department did not properly obtain or retain the required authorization form in employee files.

Effect

Employees may be issued purchase cards without the proper authorization.

Recommendation

Purchasing personnel should ensure compliance with the City’s policy. It is recommended that the purchasing manager perform a review of each employee’s purchase card file and obtain signed authorizations where they are missing. We also recommend adding a checklist to each file indicating all required forms are current and present in the file.

Views of Management

Management concurs with the auditors’ recommendation and has implemented corrective actions. In December 2015, the Purchasing Coordinator completed a review of active cardholder files to document signed authorization forms. In the next fiscal year, the division will obtain signed documents for the list of cardholders with missing authorization forms. During the review, staff compiled items for the creation of a purchasing card form checklist. In January 2016, the Purchasing Coordinator reviewed and modified the Purchasing Card Request Form to add a signature line for the Purchasing and Contracts Administration Division Manager, who will also periodically review cardholder files to ensure compliance.

2015-004 Purchase Cards (Pcards) – Signed Employee Statements Criteria

As per the City’s purchase card policy, the employee will sign an Employee Statement or agreement indicating they have been provided a purchase card and agree to comply with the City’s purchase card policies.

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APPENDIX B – CURRENT YEAR FINDINGS AND RECOMMENDATIONS

Condition

Of the sample of 27 purchase cards selected for testing, four purchase card files were missing the signed employee statements.

Cause

The purchasing department did not properly obtain or retain the required employee statements/agreements in employee files.

Effect

Improper or unauthorized purchases may be made. It is difficult to hold the employee accountable to the policy when there is no evidence that they received and reviewed the policy as a requirement of taking possession and using the purchase card.

Recommendation

Purchasing personnel should ensure compliance with the City’s policy. It is recommended that the purchasing manager perform a review of each employee’s purchase card file and obtain signed employee statement or agreement where they are missing. We also recommend adding a checklist to each file indicating all required forms are current and present in the file.

Views of Management

Management concurs with the auditors’ recommendation and has implemented corrective actions. In December 2015, the Purchasing Coordinator completed a review of active cardholder files to document signed Cardholder Agreement Forms. In the next fiscal year, the division will obtain signed documents for the list of cardholders with missing Cardholder Agreement Forms. During the review, staff compiled items for the creation of a purchasing card form checklist. In January 2016, the Purchasing Coordinator reviewed and modified the Cardholder Agreement Form to add a signature line for the Coordinator. The Purchasing and Contracts Administration Division Manager will periodically review cardholder files to ensure compliance.

2015-005 Purchase Cards (Pcards) – Approved Spending Limits Criteria

As per the City’s purchase card policy, the department head authorizes the cardholders spending limits on the Purchase Card Authorization form, or Purchase Card Maintenance Form if it is a change of spending limit.

Condition

Of the sample of 27 purchase cards selected for testing, 20 purchase cards were missing supporting signed authorization forms that supported the spending limits downloaded from credit card Company’s website BOFA Works.

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Cause

The purchasing department did not properly obtain or retain the required authorizations forms indicating current authorized spending limits.

Effect

Employee purchases could exceed the level authorized by the employee’s department head.

Recommendation

Purchasing personnel should ensure compliance with the City’s policy. It is recommended that the purchasing manager perform a review of each employee’s purchase card file and obtain signed spending limit authorization forms where they are missing. We also recommend adding a checklist to each file indicating all required forms are current and present in the file.

Views of Management

Management concurs with the auditors’ recommendation and will implement the following corrective actions in the next fiscal year. The Purchasing Coordinator will review and modify, if necessary, the Procurement Card Change Form to include a signature line for the Purchasing and Contracts Administration Division Manager. The Purchasing Coordinator will also review the Purchasing Card Request Form, the Procurement Card Change Form and the purchasing card company website to verify that transactional limits match. Matching limits will be noted, signed and dated; differences will be rectified with a Procurement Card Change Form completed by the department. The Purchasing and Contracts Administration Division Manager will periodically review cardholder files to ensure compliance.

2015-006 Payroll User Access Rights Criteria

The City should monitor the payroll user access rights assigned for payroll to ensure proper segregation of duties is maintained for updating employees’ personnel and payroll records.

Condition

During our walkthroughs and documentation of internal controls, it was noted that certain user access rights were incompatible for achieving proper segregation of duties or lacked a mitigating control where overrides to the system were necessary.

Cause

User access rights assigned were not carefully reviewed to make sure incompatible functions could not be performed.

Effect

Unauthorized changes could be made to employee payroll records.

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Recommendation

It is recommended that the City review the user access rights for payroll positions, update user rights as necessary to ensure proper segregation of duties and implement mitigating controls where it would be impractical to limit user access based on staff size or duties. User access rights should be reassessed upon promotions, transfers or other changes in employment status.

Views of Management

Management concurs with the auditor’s recommendation and is currently reviewing system reports to implement consistent monitoring of user access rights for payroll functions. In addition, Finance management will implement mitigating controls to ensure proper segregation of duties for updating employees’ personnel and payroll records.

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INDEPENDENT ACCOUNTANTS’ REPORT Honorable Mayor and City Council City of Fort Myers, Florida Fort Myers, Florida We have examined the City of Fort Myers, Florida's (City) compliance with Section 218.415, Florida Statutes, regarding the investment of public funds during the year ended September 30, 2015. Management is responsible for the City's compliance with those requirements. Our responsibility is to express an opinion on the City’s compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the City’s compliance with specified requirements. In our opinion, the City complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2015. This report is intended solely for the information and use of the City and the Auditor General, State of Florida, and is not intended to be, and should not be, used by anyone other than these specified parties.



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