Comprehensive Annual Financial Report - City of Santa Monica

CITY OF SANTA MONICA, CALIFORNIA
Management’s Discussion and Analysis
Year ended June 30, 2009
As management of the City of Santa Monica, California (City), we offer readers of the City’s
Comprehensive Annual Financial Report (CAFR) this narrative overview and analysis of the financial
activities of the City for the fiscal year ended June 30, 2009. We encourage readers to consider the
information presented here in conjunction with additional information that we have furnished in the City’s
basic financial statements, which immediately follow this section, and the CAFR transmittal letter in the
preceding Introductory Section.
FINANCIAL HIGHLIGHTS
The total assets of the City for its governmental and business-type activities exceeded its liabilities
as of June 30, 2009 by $1.5 billion. Of this amount, $997.5 million are capital assets, net of related
debt, $188.8 million is for restricted uses as specified by entities outside of the City government,
and $354.6 million is for unrestricted uses in accordance with finance-related legal requirements
reflected in the City’s fund structure.
The City’s total net assets increased $29.2 million during the current fiscal year.
At the end of the current fiscal year, the City’s governmental funds reported total ending fund
balances of $440.6 million, an increase of $14.5 million compared with the prior fiscal year. Of this
amount, $176.2 million was reserved for uses set by various legal requirements and $264.4 million
was unreserved. Of the unreserved amount, $256.1 million was designated for various specific uses
by the City Council, and $8.3 million was unreserved and undesignated.
At the end of the current fiscal year, the General Fund fund balance was $197.0 million, an increase
of $48.2 million from the previous fiscal year, which consisted of a decrease of $39.6 million of
reserved fund balance and an increase of $87.8 million of unreserved fund balance. Of the $155.5
million unreserved fund balance, $147.9 is designated and $7.6 million is undesignated.
The City’s investment in capital assets increased by $34.1 million or 3.5%. Please see further detail
of capital assets in note 7.
The City’s long-term debt increased by $5.8 million or 2.9% during the current fiscal year. Please
see the table on page 13 and for further detail of long-term debt see note 9.
OVERVIEW OF THE BASIC FINANCIAL STATEMENTS
Management’s Discussion and Analysis is intended to serve as an introduction to the City’s basic
financial statements. The City’s basic financial statements include three components: government-wide
financial statements, fund financial statements, and notes to the basic financial statements. The major
features of these financial statements, including the portion of the city government they cover and the
types of information they contain, are summarized on the following page. The remainder of this overview
section of management’s discussion and analysis explains the structure and contents of each of the
statements.
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