HomeMy WebLinkAbout2016 City of Lansing-CAFR ACFR Comprehensive Annual financial ReportCity of Lansing,
Michigan
Year Ended
June 30, 2016
Comprehensive
Annual Financial
Report
Prepared by: Department of Finance
Finance Director
Angela Bennett
Accounting Manager
Randy Endsley
CITY OF LANSING, MICHIGAN
Table of Contents
Page
INTRODUCTORY SECTION 1
Elected and Appointed Officers 2
Letter of Transmittal 3
Table of Organization 7
GFOA Certificate of Achievement 8
FINANCIAL SECTION 9
Independent Auditors’ Report 11
Management’s Discussion and Analysis 15
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Position 30
Statement of Activities 31
Fund Financial Statements:
Balance Sheet – Governmental Funds 36
Reconciliation of Fund Balances of Governmental Funds
to Net Position of Governmental Activities 37
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds 38
Reconciliation of Net Changes in Fund Balances of Governmental Funds
to Change in Net Position of Governmental Activities 39
Statement of Revenues, Expenditures and Changes in
Fund Balances – Budget and Actual:
General Fund 40
Statement of Net Position – Proprietary Funds 44
Statement of Revenues, Expenses and Changes in Fund Net
Position – Proprietary Funds 45
Statement of Cash Flows – Proprietary Funds 46
Statement of Fiduciary Net Position - Fiduciary Funds 50
Statement of Changes in Fiduciary Net Position - Pension and
Other Postemployment Benefits Trust Funds 51
Combining Statement of Net Position – Discretely Presented Component Units 56
Combining Statement of Activities – Discretely Presented Component Units 57
Notes to Financial Statements 59
CITY OF LANSING, MICHIGAN
Table of Contents
Page
Required Supplementary Information 113
Schedule of Changes in Net Pension Liability and Related Ratios -
Employees' Retirement System 114
Schedule of the Net Pension Liability - Employees' Retirement System 115
Schedule of Contributions - Employees' Retirement System 116
Schedule of Investment Returns - Employees' Retirement System 117
Schedule of Changes in Net Pension Liability and Related Ratios -
Police and Fire Retirement System 118
Schedule of the Net Pension Liability - Police and Fire Retirement System 119
Schedule of Contributions - Police and Fire Retirement System 120
Schedule of Investment Returns - Police and Fire Retirement System 121
Schedule of Funding Progress – Other Postemployment Benefit Plans 122
Schedule of Employer Contributions – Other Postemployment Benefit Plans 122
Combining and Individual Fund Financial Statements and Schedules 123
Nonmajor Governmental Funds:
Combining Balance Sheet – Nonmajor Governmental Funds 124
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Governmental Funds 125
Combining Balance Sheet – Nonmajor Special Revenue Funds 128
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Special Revenue Funds 130
Schedule of Revenues, Expenditures and Changes in Fund
Balances – Budget and Actual – Nonmajor Special Revenue Funds 132
Combining Balance Sheet – Nonmajor Debt Service Funds 140
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Debt Service Funds 141
Combining Balance Sheet – Nonmajor Capital Projects Funds 144
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Capital Projects Funds 145
Combining Balance Sheet – Nonmajor Permanent Funds 148
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Permanent Funds 149
Nonmajor Enterprise Funds:
Combining Statement of Net Position – Nonmajor Enterprise Funds 152
Combining Statement of Revenues, Expenses and Changes in Fund Net
Position - Nonmajor Enterprise Funds 153
Combining Statement of Cash Flows - Nonmajor Enterprise Funds 154
Internal Service Funds:
Combining Statement of Net Position – Internal Service Funds 158
Combining Statement of Revenues, Expenses and Changes in Fund Net
Position - Internal Service Funds 159
Combining Statement of Cash Flows - Internal Service Funds 160
CITY OF LANSING, MICHIGAN
Table of Contents
Page
Agency Funds:
Combining Statement of Fiduciary Assets and Liabilities – Agency Funds 164
Combining Statement of Changes in Fiduciary Assets and Liabilities – Agency Funds 165
STATISTICAL SECTION (UNAUDITED)167
TABLE
1 Net Position by Component 171
2 Change in Net Position 172
3 Fund Balances, Governmental Funds 174
4 Changes in Fund Balances of Governmental Funds 175
5 Assessed and Estimated Actual Value of Taxable Property 176
6 Direct and Overlapping Property Tax Rates 177
7 Profile of Ten Largest Ad Valorem Taxpayers 178
8 Property Tax Levies and Collections 179
9 Ratios of Outstanding Debt by Type 180
10 Ratios of General Bonded Debt Outstanding 181
11 Direct and Overlapping Governmental Activities Debt 182
12 Legal Debt Margin Information 183
13 Pledged-Revenue Coverage 184
14 Demographic and Economic Statistics 185
15 Principal Employers 186
16 Full-Time Equivalent City Governmental Employees by Function/Program 188
17 Operating Indicators by Function/Program 192
18 Capital Asset Statistics by Function/Program 194
INTRODUCTORY SECTION
1
CITY OF LANSING, MICHIGAN
ELECTED AND APPOINTED OFFICERS
AT LARGE BY WARDS
Judi Brown Clarke Jody Washington – 1st Ward
Patricia Spitzley Tina Houghton – 2nd Ward
Kathie Dunbar Adam Hussain – 3rd Ward
Carol Wood Jessica Yorko – 4th Ward
Randy Hannan Executive Assistant/Chief of Staff
Chad Gamble Chief Operating Officer/Public Service Director
Vacant City Attorney
Angela Bennett Finance Director
Mary Riley Human Resources Director
Sharon Frischman City Assessor
Tammy Good City Treasurer
Randy Talifarro Fire Chief
Michael Yankowski Police Chief
Joan Jackson Johnson Human Relations & Community Services Director
Brett Kaschinske Parks & Recreation Director
Robert Johnson Planning & Neighborhood Development Director
Vacant Internal Auditor
For the Year Ended June 30, 2016
Virg Bernero
MAYOR
CLERK
Chris Swope
CITY COUNCIL
OFFICERS
DISTRICT COURT JUDGES
Frank J. Deluca
Hugh B. Clarke, Jr.
Louise Alderson, Chief Judge
Patrick F. Cherry
2
December 22, 2016
Council President Judi Brown Clarke
and Council Members
10th Floor City Hall
Lansing, Michigan 48933-1694
Dear President Houghton and Council Members:
Serving as Michigan’s capital since 1848, the City of Lansing was incorporated in 1859 and operates under
provisions of Public Act 279 of 1909, as amended (the “Home Rule City Act”). The City incorporates 34.7
square miles and is located in the lower middle of Michigan’s Lower Peninsula and operates under a strong
mayor form of government established by 1978 Charter revision.
We are pleased to submit the comprehensive annual financial report of the City of Lansing, Michigan for the
fiscal year ended June 30, 2016.
The City assumes full responsibility for both the accuracy of the data and the completeness and fairness of
the presentation, including all disclosures. To the best of our knowledge and belief, the enclosed data are
accurate in all material respects and are reported in a manner designed to present fairly the financial
position and results of operations government wide and of the various funds of the City. All disclosures
necessary to enable the reader to gain an understanding of the City's financial activities have been included.
The City’s fiscal year 2015/2016 financial statements have been audited by Rehmann Robson, an independent
firm of licensed, certified public accountants. The goal of the independent audit is to provide reasonable
assurance that the financial statements for the City of Lansing for the fiscal year-ended June 30, 2016, are
free of material misstatement. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures contained in the financial statements; assessing the accounting
principles used; and evaluating the overall financial statement presentation. The independent audit
concluded with the rendering of an unmodified opinion on the statements, meaning the financial statements
present, fairly and accurately in all material respects, the financial position of the City in conformity with
Generally Accepted Accounting Principles (“GAAP”). The independent auditors repot is presented as the first
component of the financial section of this report.
This letter of transmittal is designed to complement the Management Discussion and Analysis (MD&A) and
should be read in conjunction with it. The Management Discussion and Analysis can be found immediately
following the Independent Auditor Report.
Profile of the City of Lansing
3
Lansing is a mature core city with a population of 115,056, according to 2015 census estimates, and offers a
full range of services. During the fiscal year ended June 30, 2016, the City operated police headquarters and
a precinct with over 190 sworn police officers; six fire stations with a fire protection force of over 170; over
350 miles of sanitary sewers, 230 miles of storm sewers, and 180 miles of combined sewers; over 400 miles of
roads; 113 parks; a District Court; and support for human services and cultural events. The City’s main
sources of revenue are property taxes, income taxes, State revenue sharing, Federal entitlement grants, and
charges for services, including utility billings.
Reporting Entity
The financial reporting entity (the City) includes all of the funds and of the primary government (i.e., the
City as legally defined), as well as its blended component units. Blended component units, although legally
separate entities, are, in substance, part of the primary government’s operations and are included as part of
the primary government. The Lansing Building Authority is a blended component unit. Discretely presented
component units are reported in a separate column in the combined financial statements to emphasize that
they are legally separate from the primary government and to differentiate their financial position, results of
operations and cash flows from those of the primary government. The Lansing Entertainment & Public
Facilities Authority, Tax Increment Finance Authority, Brownfield Redevelopment Authority, and Smart Zone
are reported as a discretely presented component units.
Financial Management and Control
Management of the City of Lansing is responsible for establishing and maintaining internal controls designed
to ensure that the assets of the government are protected from loss, theft, or misuse and to assure that
adequate accounting data is compiled to allow for the accurate presentation of financial statements in
conformity with generally accepted accounting principles.
To provide a reasonable basis for making these presentations, management has established a comprehensive
system of internal controls designed to reasonably ensure that assets of the City are protected from loss,
theft or misuse and to ensure that adequate accounting data are compiled to allow for the preparation of
these financial statements in conformity with generally accepted accounting principles. Such controls
include appropriate policies and procedures, ongoing risk assessment, and monitoring and review processes
which are communicated throughout City operations. Because the cost of internal controls generally should
not outweigh their benefits, the City’s framework of internal controls has been designed to provide
reasonable, rather than absolute, assurance that these objectives are met.
Because the City is a recipient of federal grant dollars, the independent audit of the financial statements of
the City of Lansing was part of a broader, federally-mandated “single audit” in conformity with the
provisions of the Single Audit Act of 1996 and the U.S. Office of Management and Budget Circular A-133,
Audits of States. Local Governments, and Non-profit Organizations. The standards governing the single audits
require the independent auditor to report not only on the fair presentation of the financial statements, but
also on the audited government’s internal controls and compliance with legal requirements involving the
administration of the federal awards. These reports are available in the City’s separately-issued Single Audit
Report.
Financial results and applicable policies affecting year-end results for the fiscal year-ended June 30, 2015
are discussed in the Management Discussion and Analysis (MD&A), located immediately following the
Independent Auditor Report.
4
The City of Lansing is the seat of Michigan state government and the local economy is comprised of a
diversified mix of business and industries. With Michigan State University, Davenport University, Cooley Law
School and Lansing Community College, the region has a strong higher education presence. The metro
Lansing region is also home to several insurance company headquarters, including Jackson National Life, Auto
Owners, AF Group, and Delta Dental; healthcare services with two major hospitals in the city, Sparrow and
McLaren; and a wide variety of technology firms. Manufacturing also has a strong presence, especially in the
automotive and biotech engineering sectors, with two General Motors assembly plants and related facilities
located in the city, automotive suppliers throughout the region, Niowave's production of particle
accelerators, and Emergent Biosolution's research and vaccine production.
The annual budget serves as the foundation for the City’s financial planning, policy-making, and control. The
City Charter requires that the Mayor submit to the City Council a proposed budget by the fourth Monday in
March. Budgetary controls and limitations are noted in the Note Disclosure Section of the financial
statements.
The City also maintains an encumbrance accounting system, whereby purchase orders amounts are deducted
from the available budget, as one technique of accomplishing budgetary control. Encumbered amounts lapse
at year end and require Council approval to be carried forward to the ensuing fiscal year for amounts greater
than $5,000 or greater than eight months old.
Local Economy
Budgeting Controls
While its presence in the metro Lansing region has decreased over the past two decades, General Motors has
continued to invest in its two state-of-the-art Lansing plants, even during the recent Great Recession. The
plants produce the Buick Enclave, GMC Acadia, Chevrolet Traverse, Cadillac ATS (2013 North American Car of
the Year) and Cadillac CTS (2008 and 2014 Motor Trend Car of the Year). Production of the Chevrolet Camaro
was moved to Lansing from Ontario, Canada in July, 2015 and was subsequently named 2016 Motor Trend Car
of the Year. Over the past three years, General Motors has invested over $277 million in plant expansions
and retooling, $40 million in a new Logistics Center, and $174 million in a new regional stamping plant.
Currently under construction and scheduled for completion in 2022, Michigan State University will be home to
the $174 million Facility for Rare Isotope Beams (FRIB), which will enable scientific discovery of rare isotope
properties, will employ top nuclear physicists, and is expected to create approximately 1,000 jobs. Even
before the plant is completed, Niowave, Inc. established its operations in Lansing as commercial spinoff from
Michigan State University’s nuclear cyclotron facility. MSU has been named #1 in Nuclear Physics, ahead of
MIT, by U.S. News & World Report for four consecutive years.
Lansing serves as the cultural and commercial center for the region, and recent major investments have
revitalized downtown Lansing into an entertainment and residential destination, with renovations to historic
buildings and brand new developments. The former Lansing Board of Water Light downtown plant was
transformed in 2011 into the corporate headquarters for Accident Fund Insurance Company of America (now
AF Group), followed by Blue Cross Blue Shield of Michigan moving into Accident Fund's former downtown
location. Recent renovations of the former downtown Knapp's department store into apartments and
commercial space have attracted Dewpoint, CGI Group, Inc., and TEKsystems technology firms. Highly
successful, recently-completed new developments, including Marketplace, Midtown, and The Outfield
residential developments, and the SkyView on Michigan development currently under construction, have
added significant additional residential units near and within downtown. The Outfield Ballpark Lofts
development was the first in the nation to feature apartments located right in the outfield of a Class-A minor
league baseball stadium and has received national and international awards.
5
Sincerely,
Virg Bernero
Mayor
Angela Bennett
Finance Director
Preparation of this comprehensive annual financial report was made possible by the dedicated service of the
entire staff of the Finance Department, as well as support by other departments. All those who contributed
to this document, especially Accounting Manager Randy Endsley, have our sincere appreciation for their
contributions made in the preparation of this report and in the financial management of the City. The 38th
consecutive GFOA award, recognizing their efforts, is well deserved indeed.
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in
Financial Reporting to the City for its Comprehensive Annual Financial Report for the fiscal year ended June
30, 2015. This was the 38th consecutive year that the City has received this prestigious award. In order to be
awarded a Certificate of Achievement, the City must publish an easily readable and efficiently organized
comprehensive annual financial report. This report satisfied both generally accepted accounting principles
and applicable legal requirements.
In its commitment to regional partnerships, the City of Lansing has contracted with the Lansing Economic
Area Partnership (LEAP) since 2012. This arrangement allows for a cost-effective, regional-based approach
to economic development. As testament to its success, this past year, LEAP received the prestigious
Excellence in Economic Development Award by the International Economic Development Council (IEDC). Over
the past decade, LEAP and the Lansing Economic Development Corporation have attracted more than $2.3
billion in new private investment to the City.
The metro Lansing region is one of growth and opportunities; it was one of only two communities in the State
of Michigan to show population growth in the 2010 Census. The region was ranked the best in the U.S. for
job growth in Goods Produced, Manufacturing and Transportation & Utilities job sectors by Urban Institute’s
Metro Trends, and Lansing was recently named by Kiplinger's Nation’s Top 10 Best Cities for Young Adults,
ranking with cities like Austin, Texas, and Boston, Massachusetts.
Awards and Acknowledgements
The Certificate of Achievement is valid for a period of one year only. We believe that our current
Comprehensive Annual Financial Report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
6
CITY OF LANSING, MICHIGAN
Table of Organization
7
CITY OF LANSING, MICHIGAN
GFOA Certificate of Achievement
Add here
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FINANCIAL SECTION
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INDEPENDENT AUDITORS' REPORT
December 22, 2016
Honorable Mayor and
Members of the City Council
City of Lansing, Michigan
Report on the Financial Statements
Management's Responsibility for the Financial Statements
Independent Auditors' Responsibility
We have audited the accompanying financial statements of the governmental activities, the business-
type activities, the aggregate discretely presented component units, each major fund, and the
aggregate remaining fund information of the City of Lansing, Michigan (the “City”), as of and for the
year ended June 30, 2016, and the related notes to the financial statements, which collectively
comprise the City’s basic financial statements as listed in the table of contents.
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.
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.
Rehmann Robson
2330 East Paris Ave. SE
Grand Rapids, MI 49546
Ph: 616.975.4100
Fx: 616.975.4400
rehmann.com
11
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 financial
statements and schedules, and the introductory section and statistical tables are presented for purposes
of additional analysis and are not a required part of the basic financial statements.
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, the aggregate
discretely presented component units, each major fund, and the aggregate remaining fund information
of the City of Lansing, Michigan, as of June 30, 2016, and the respective changes in financial position
and, where applicable, cash flows thereof and the budgetary comparison for the General Fund for the
year then ended in conformity with accounting principles generally accepted in the United States of
America.
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis and the schedules for the pension and other postemployment
benefits plans, as listed in the table of contents, 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.
Restatement of Beginning Net Position of the Brownfield Redevelopment Authority Component
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Opinions
Required Supplementary Information
As described in Note 19, the beginning net position of the Brownfield Redevelopment Authority
component unit was reduced to reflect the fact that certain outstanding loans receivable are only
collectible from outside parties if future tax captures are insufficient to cover the required payments
(contingent receivables). Our opinion is not modified with respect to this matter.
12
The introductory section and statistical tables 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.
In accordance with Government Auditing Standards,we have also issued, under separate cover, our
report dated December 22, 2016, on our consideration of the City of Lansing, Michigan’s internal control
over financial reporting and our tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements and other matters. The purpose of that report is to describe the scope
of our testing of internal control over financial reporting and compliance and the results of that testing,
and not to provide an opinion on the internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards in
considering the City's internal control over financial reporting and compliance.
Other Reporting Required by Government Auditing Standards
The combining and individual fund financial statements and schedules 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 combining and individual fund financial statements and schedules
are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
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MANAGEMENT'S DISCUSSION AND ANALYSIS
15
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Financial Highlights
·
·
·
·
·
Overview of the Financial Statements
The business-type activities reported net position at year-end of $242.6 million, an increase of $3.7 million during
the year.
As of the close of the 2015/2016 fiscal year, the City’s governmental funds reported combined ending fund
balances of $30.9 million on a modified accrual basis, a $4.1 million increase from fiscal year 2014/2015. Of the
$30.9 million fiscal year 2015/2016 combined ending fund balance, $10.0 million is legally restricted and/or
unavailable to spend (i.e. amounts tied up in inventories), and $8.9 million is committed for designated projects,
leaving $12.0 million unassigned.
The management of the City of Lansing, Michigan (“the City”) provides this narrative overview and analysis of the
financial activities of the City for the fiscal year ended June 30, 2016 for the benefit of the readers of these financial
statements. This management’s discussion and analysis (“MD&A”) is intended to assist the reader in focusing on
significant financial issues and provide an overview of the City’s financial activity. The City encourages the readers to
consider the following information here in conjunction with the financial statements taken as a whole, which follow
this section.
The City’s total bonded and loaned debt was $219.5 million at June 30, 2016, a decrease of $17.6 million (or
7.4%), which represents the net difference between new issuances and payments. More detailed information
regarding these activities and funds can be found in Footnote 9, Long-Term Debt of the Notes to the Financial
Statements section of the CAFR.
Total government-wide assets and deferred outflows of resources of the City exceeded its liabilities and deferred
inflows of resources at the close of the fiscal year by $139.5 million (reported as net position), a decrease of
$12.1 million from fiscal year 2014/2015.
This MD&A is an introduction to the City’s basic financial statements, which comprise three components: 1)
government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This
report also contains other required supplementary information in addition to the basic financial statements.
Government-Wide Financial Statements.These statements include all non-fiduciary assets and liabilities, excluding
assets and liabilities related to pension and OPEB plans. The Statement of Net Position and the Statement of Activities
are two financial statements that report information about the City, as a whole, and about its activities, which
provide measurements of long-term trends that should help answer this question: Is the City, as a whole, better off or
worse off as a result of this year’s activities? Unlike the governmental funds, the current year’s revenues and expenses
are taken into account regardless of when cash is received or paid, known as “full accrual accounting”.
The Statement of Net Position presents all of the City’s assets, deferred outflows of resources, liabilities and deferred
inflows of resources with the difference between the these categories reported as “net position”. Over time,
increases and decreases in net position are an indicator of whether the City’s long-term financial position is improving
or deteriorating, but can also change as a result of governmental accounting standards.
At the end of the fiscal year, unassigned fund balance for the General Fund, (including the amount internally
identified as a Budget Stabilization Fund), was $12.4 million, an increase of $2.6 million from FY 2014/2015.
Please see the “General Fund and Budgetary Highlights” section of this Management Discussion and Analysis for
further detail.
16
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
·
·
·
·
·
·
·
·
·
·
· Bond and note proceeds result in liabilities on the government-wide statements, but are recorded as other
financing sources on the governmental fund statements.
Other long-term assets that are not available to pay for current period expenditures are deferred in governmental
fund statements, but not deferred on the government-wide statements.
Internal service funds are reported as governmental activities, but reported as proprietary funds in the fund
financial statements.
Bond discounts and premiums in the issuance of long-term debt, are reported as expenditures in governmental
fund statements, but are capitalized and amortized in the government-wide statements.
Unless due and payable, long-term liabilities, such as capital lease obligations, compensated absences, and others
only appear as liabilities in the government-wide statements.
Capital outlay spending in excess of capitalization thresholds are recorded as capital assets on the government-
wide statements, but are reported as expenditures on the governmental fund statements.
These financial statements include two schedules that reconcile the amounts reported on the governmental fund
financial statements (modified accrual accounting) with governmental activities (full accrual accounting) on the
appropriate government-wide statements. The following summarizes the impact of transitioning from modified accrual
to full accrual accounting:
Capital assets used in governmental activities are not reported on governmental fund statements.
Certain revenues that are earned, but not available for use within the reporting period, are reported as revenues
for governmental activities, but are reported as deferred inflows of resources on the governmental fund
statements.
Governmental Activities.Most of the City’s basic services are reported under this category. Property taxes,
income taxes, and intergovernmental revenues generally fund these services. The Council (legislative branch), the
District Court (judicial branch), and general operations of the executive branch departments, such as police, fire,
parks, public works, and other general staff departments fall within the governmental activities.
Business-type Activities.The City charges fees to customers to help cover all or most of the costs of certain
services it provides. Sewage collection and treatment and commercial area parking are examples of business-type
activities.
Discretely Presented Component Units.Component units are legally separate organizations for which the elected
officials of the primary government are financially accountable. The City has various discretely presented units:
the Lansing Entertainment and Public Facilities Authority, the Tax Increment Finance Authority, the Brownfield
Redevelopment Authority, and the SmartZone (which was dissolved as of June 30, 2016).
The Statement of Activities presents information showing how the City’s net position changed during the most recent
fiscal year. All changes in net position are reported as soon as the underlying events giving rise to the change occur,
regardless of the timing of related cash flows. Therefore,revenues and expenses are reported in these statements for
some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused
vacation leave).
The Statement of Net Position and the Statement of Activities report three activities, as follows:
17
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
·
·
·
·
·
Required Supplementary Information
Following the basic financial statements is additional Required Supplementary Information that further explains and
supports the information in the financial statements. The Required Supplementary Information includes required
pension and other postemployment benefit supplementary information.
Other Supplementary Information
Other supplementary information includes combining financial statements for nonmajor governmental, proprietary,
and fiduciary funds. These funds are added together, by fund type, and presented in single columns in the basic
financial statements, but are not reported individually, as with major funds, on the governmental fund financial
statements.
Certain other outflows, such as debt service principal payments, represent decreases in liabilities on the
government-wide statements, but are reported as expenditures on the governmental fund statements.
The Notes to the Financial Statements provide additional information that is essential to a full understanding of the
data provided in the government-wide and fund financial statements.
Fund Financial Statements.The City’s major funds are identified as the General Fund, Sewage Disposal System
Fund, and Municipal Parking System Fund. Data for all other funds, termed "nonmajor funds", are combined into a
single, aggregated presentation. A fund is a fiscal and accounting entity with a self-balancing set of accounts that the
City uses to keep track of specific sources of funding and spending for a particular purpose.
Governmental funds.Most of the City’s basic services are reported in the governmental funds, which focus on
how money flows into and out of those funds and the balances left at year-end that are available for future
spending. The governmental fund financial statements provide a detailed short-term view of the City’s general
government operations and the basic services it provides. Governmental fund information helps determine
whether there are greater or fewer financial resources that can be spent in the near future to finance the City’s
programs. These funds are reported using modified accrual accounting, which measures cash and all other
financial assets that can readily be converted to cash. Governmental funds include the General Fund and special
revenue, capital projects, debt service, and permanent funds.
Proprietary funds.When the City charges customers for the services it provides, whether to outside customers or
to other agencies within the City, these services are generally reported in proprietary funds. Proprietary funds
(enterprise and internal service) utilize full accrual accounting; the same method used by private sector
businesses. Enterprise funds report activities that provide supplies and services to the general public. Examples
are the Sewage Disposal Fund and the Municipal Parking Fund. Internal service funds are reported as
governmental activities on the government-wide statements.
Fiduciary Funds.The City acts as a trustee or fiduciary, for its employee pension and other postemployment
benefit plans. It is also responsible for other assets that, because of a trust arrangement, can be used only for the
trust beneficiaries. The City’s fiduciary activities are reported in separate Statements of Fiduciary Net Position
and Changes in Fiduciary Net Position. These funds, which include pension and other postemployment benefit
funds, are reported using full accrual accounting. The government-wide statements exclude fiduciary fund
activities and balances because these assets are restricted in purpose and do not represent spendable assets of
the City to finance its operations.
Pension and other postemployment benefits liabilities and related deferrals relating to governmental funds are
only reported in the government-wide statements.
18
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Net Position
Governmental Activities Business-type Activities Total
2016 2015 2016 2015 2016 2015
Current and other assets 59,967,923$ 55,267,321$ 75,273,478$ 72,710,863$ 135,241,401$ 127,978,184$
Capital assets, net 194,187,285 200,588,271 371,535,963 382,581,922 565,723,248 583,170,193
Total assets 254,155,208 255,855,592 446,809,441 455,292,785 700,964,649 711,148,377
Deferred outflows of
resources 59,465,643 19,319,368 7,190,842 4,220,635 66,656,485 23,540,003
Long-term liabilities 56,959,949 63,089,729 176,980,629 189,410,522 233,940,578 252,500,251
Other liabilities 355,363,179 295,991,635 33,360,540 30,325,950 388,723,719 326,317,585
Total liabilities 412,323,128 359,081,364 210,341,169 219,736,472 622,664,297 578,817,836
Deferred inflows of
resources 4,376,709 3,449,346 1,055,949 832,207 5,432,658 4,281,553
Net position
Net investment in
capital assets 149,676,860 151,785,916 220,436,882 218,813,478 370,113,742 370,599,394
Restricted 12,922,525 12,311,541 2,764,963 2,889,096 15,687,488 15,200,637
Unrestricted (265,678,371) (251,453,207) 19,401,320 17,242,167 (246,277,051) (234,211,040)
Total net position (103,078,986)$ (87,355,750)$ 242,603,165$ 238,944,741$ 139,524,179$ 151,588,991$
The City’s combined net position decreased $12.1 million over the course of this fiscal year’s operations, and came to
a total of $139.5 million. Net position of governmental activities decreased $15.7 million or 18.0%, and business-type
activities increased $3.7 million or 1.5%. Explanations for those changes are described below under the governmental
activities and business-type activities sections of this Management Discussion and Analysis.
Government-Wide Financial Analysis
The largest component of the City’s net position reflects its net investment in capital assets (e.g. land, buildings,
equipment, infrastructure, and others). Restricted net position is the next largest component, which represents
amounts subject to external restrictions such as bond covenants, City Charter, State legislation or Constitutional
provision. The remaining portion, unrestricted net position are resources that may be used at the City’s discretion,
but often have limitations based on policy action.
19
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Governmental Activities Business-type Activities Total
2016 2015 2016 2015 2016 2015
Program revenues
Charges for services 13,941,487$ 12,770,559$ 45,583,654$ 44,787,903$ 59,525,141$ 57,558,462$
Operating grants 24,561,960 24,658,955 1,312,362 1,143,085 25,874,322 25,802,040
Capital grants 904,298 2,910,660 - - 904,298 2,910,660
General revenues
Taxes 73,151,678 71,318,305 - - 73,151,678 71,318,305
State shared revenues 13,911,200 13,919,567 - - 13,911,200 13,919,567
Unrestricted grants
and contributions 22,621,075 22,411,409 - - 22,621,075 22,411,409
Unrestricted investment
earnings 99,058 26,353 - 17,874 99,058 44,227
Gain on sale of
capital assets 63,079 280,280 3,853 - 66,932 280,280
Total revenues 149,253,835 148,296,088 46,899,869 45,948,862 196,153,704 194,244,950
Expenses
General government 27,993,414 25,225,893 - - 27,993,414 25,225,893
Public safety 85,739,408 81,827,437 - - 85,739,408 81,827,437
Public works 28,212,049 27,815,970 - - 28,212,049 27,815,970
Recreation and culture 10,336,168 6,515,590 - - 10,336,168 6,515,590
Community development 10,642,102 10,270,404 - - 10,642,102 10,270,404
Interest on long-term debt 1,424,215 1,291,846 - - 1,424,215 1,291,846
Sewage disposal system - - 28,487,957 27,506,843 28,487,957 27,506,843
Municipal parking system - - 7,651,077 7,605,461 7,651,077 7,605,461
Cemetery - - 708,545 632,485 708,545 632,485
Golf - - 845,575 852,634 845,575 852,634
Garbage and rubbish
collection - - 2,085,728 1,712,671 2,085,728 1,712,671
Recycling - - 4,092,278 3,623,276 4,092,278 3,623,276
Total expenses 164,347,356 152,947,140 43,871,160 41,933,370 208,218,516 194,880,510
Change in net position,
before transfers (15,093,521) (4,651,052) 3,028,709 4,015,492 (12,064,812) (635,560)
Transfers (629,715) (644,485) 629,715 644,485 - -
Change in net position (15,723,236) (5,295,537) 3,658,424 4,659,977 (12,064,812) (635,560)
Net position:
Beginning of year,(87,355,750) 117,764,592 238,944,741 261,095,990 151,588,991 378,860,582
Restatement for
implementation of
GASB 68 - (199,824,805) - (26,811,226) - (226,636,031)
End of year (103,078,986)$ (87,355,750)$ 242,603,165$ 238,944,741$ 139,524,179$ 151,588,991$
Change in Net Position
The following condensed financial information was derived from the government-wide Statement of Activities and
reflects how the City’s net position changed during the fiscal year:
20
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Unrestricted grants and contributions (including state shared sales tax revenue) comprised 24.5%, or $36.5 million, of
revenues, a $201,299 or 0.6% increase from fiscal year 2014/2015. A little more than one-third of this category, $13.9
million, is attributed to State revenue sharing, an amount distributed to municipalities by the State of Michigan by
formula allocation of portions of the State sales tax. Equity payments from the independently-managed-and-operated
Board of Water and Light account for $21.0 million of the category, with the remaining revenue coming from
payments from the State of Michigan for a payment in lieu of tax for its fire protection for its properties, bad driver
revenues, and reimbursement of liquor license enforcement costs. The $201,299 increase from the prior year was
attributable to a reimbursement of State election costs and an increase in the equity payment from the Board of
Water and Light.
Property taxes and special assessments comprised the largest portion of governmental activity revenue at 25.8%, or
$38.6 million, a $1.1 million, or 2.7% decrease from fiscal year 2014/2015. $789,400 of the decrease resulted from a
one-time change in accrual of certain tax-sharing agreement receipts, with remaining decrease resulting from changes
in deferred revenue.
Restricted operating and capital grants and contributions made up $25.5 million, or 17.1% of governmental activity
revenue for fiscal year 2015/2016, a $2.1 million, or 7.6% decrease from fiscal year 2014/2015. In this category, $16.4
are primarily from recurring sources such as State Gas & Weight tax revenues restricted for streets; Community
Development, HOME, and Emergency Shelter entitlement grants; and drug forfeiture funds restricted for drug
enforcement efforts. The remaining $9.1 million is attributable to non-entitlement grants. The decrease from FY
2014/2015 is the result of a reduction in non-entitlement grants with the conclusion of federal ARRA grants.
In total, governmental activity revenues increased $957,747 from FY 2014/2015 to FY 2015/2016, with trends of the
major revenue categories as follows:
Governmental Activities. The following chart depicts revenues of the governmental activities for the fiscal year:
Income taxes comprised 23.2%, or $34.6 million, of governmental activity revenue, the full amount of which is
revenue to the General Fund. This represents a $2.9 million, or 9.2%, increase from fiscal year 2014/2015. Local
income tax rates are prescribed by State law, and limited in Lansing’s case to 1% of resident income and 0.5% of the
income of persons working in the City, but living outside of its corporate boundaries.
Income tax
23.2%
Charges for services
9.3%
Operating grants
16.5%Capital grants
0.6%State shared revenues
9.3%
Unrestricted grants and
contributions
15.2%
Other revenues
0.1%
Property tax and special
assessments
25.8%
Revenues - Governmental Activities
Fiscal Year Ending June 30, 2016
21
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Total expenses for governmental activities increased $11.4 million, 7.5%, from FY 2014/2015 to FY 2015/2016 due to
an increase in legacy cost (retiree healthcare and net pension expense) on a government-wide basis. Excluding the
increase in net pension expense, governmental activity expenses increased by $2.6 million, which was mainly
attributable to infrastructure spending.
The unassigned fund balance for the General Fund, (including the amount internally identified as a Budget
Stabilization Fund), was $12.4 million, an increase of $2.6 million from FY 2014/2015, which is further described in
the next section, General Fund Budgetary Highlights.
Business-type Activities.Net position of the business-type activities increased by $3.7 million, or 1.6%, from FY
2014/2015 to $242.6 million. The increase was mainly attributable to the increase in sewer fund net position for the
fiscal year, which is necessary to fund future debt needs associated with U.S. Environmental Projection Agency and
Michigan Department of Environmental Quality-mandated sewer separation projects.
Financial Analysis of the City’s Funds
As the City completed the fiscal year, its governmental funds reported combined ending fund balances of $30.9 million
on a modified accrual basis, a $4.1 million increase from fiscal year 2014/2015. Of the $30.9 million fiscal year
2015/2016 combined ending fund balance, $10.0 million is legally restricted and/or unavailable to spend (i.e. amounts
tied up in inventories), and $8.9 million is committed for designated projects, leaving $12.0 million unassigned.
The following chart depicts expenses of the governmental activities for the fiscal year:
Charges for services are program-specific revenues generated for services provided. Governmental activity charges
for services increased $1.2 million from FY 2014/2015 to FY 2015/2016. The majority of the increase is attributable to
reimbursement of street cutting costs for accessing underground utilities and an increase in building safety inspections
due to increased development activity in the City.
General government
17.0%
Public safety
52.1%
Public works
17.2%
Recreation and culture
6.3%
Community
development
6.5%
Interest on long-term
debt
0.9%
Expenses - Governmental Activities
Fiscal Year Ending June 30, 2016
22
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Capital Assets (Net of Depreciation)
Governmental Activities Business-type Activities Total
2016 2015 2016 2015 2016 2015
Land 25,838,193$ 25,838,193$ 13,483,910$ 13,483,910$ 39,322,103$ 39,322,103$
Land improvements 10,285,057 11,074,077 11,561,180 11,457,282 21,846,237 22,531,359
Buildings and improvements 58,888,516 49,325,202 92,246,302 96,312,347 151,134,818 145,637,549
Equipment 6,776,694 7,000,277 1,384,910 1,790,500 8,161,604 8,790,777
Infrastructure 91,733,706 92,983,289 240,872,516 247,182,984 332,606,222 340,166,273
Construction in progress 665,119 14,367,233 11,987,145 12,354,899 12,652,264 26,722,132
Total capital assets, net 194,187,285$ 200,588,271$ 371,535,963$ 382,581,922$ 565,723,248$ 583,170,193$
Sewage Disposal Fund
Capital Assets.At the end of the fiscal year 2016, the City had invested $565.7 million, net of accumulated
depreciation, in a broad range of capital assets (see the table below). Additional information regarding the City's
capital assets can be found in Footnote 6 of the of the Notes to the Financial Statements section of the CAFR.
The Municipal Parking Fund net position increased $429,446, from $14.9 million to $15.3 million. Unrestricted net
position remained consistent at $5.3 million.
Net position increased $3.9 million to $232.4 million in FY 2015/2016. Unrestricted net position increased $2.8
million, from $18.8 million to $21.6 million. The increase in total net position was the result of sewer operations for
the year and is necessary to fund future debt needs associated with the U.S. Environmental Projection Agency and
Michigan Department of Environmental Quality-mandated sewer separation projects.
Municipal Parking Fund
General Fund reserves, combined with the Budget Stabilization Fund (combined for financial statement purposes)
increased $2.7 million from FY 2015/2016 from $10.7 million to $13.3 million. Unassigned fund balance increased $2.6
million (slightly less than the total fund balance increase due to changes in fund balance restrictions), or 26.8% from
fiscal year 2014/2015. This $2.6 million increase was attributable to revenues exceeding budgeted amounts by close
to $350,000 as well as expenditures coming in under budget by $2.2 million, largely due to position vacancies during
the year.
The FY 2016/2017 budget, adopted at service levels commensurate with FY 2015/2016 and anticipated revenue, is
budgeted to increase unassigned reserves by $500,000. The City's FY 2016/2017 adopted budget is available on the
City's website at www.lansingmi.gov.
General Fund Budgetary Highlights
The FY 2015/2016 General Fund budget was adopted as a balanced budget, based on projected revenues, with a
$500,000 addition to reserves (fund balance). The City budgeted a vacancy factor in its General Fund to account for
anticipated positions that would become vacant during the course of the year. Because vacancies that will occur
within each department cannot be projected, the vacancy factor is budgeted as a single line item of the General Fund
and allocated to various departments through a budget amendment during the year. During the course of the fiscal
year, the budget was amended to allocate the vacancy factor and to adjust expenditures in response to higher-than-
expected special election, street lighting, and facility maintenance and improvement needs, as well as information
technology upgrades.
23
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
2016 2015
Governmental activities
General obligation bonds 21,900,000$ 25,755,000$
Installment purchase contracts 15,268,317 16,387,327
Loans 7,872,600 7,872,600
Compensated absences 9,552,788 9,568,555
Workers compensation 2,297,914 3,418,805
Tax settlement - 52,161
Deferred amounts:
For issuance discounts (72,988) (79,821)
For issuance premiums 141,318 115,102
Total governmental activities 56,959,949 63,089,729
Business-type activities
General obligation bonds 154,534,187 165,352,984
Revenue bonds 18,725,000 20,275,000
Installment purchase
agreements 1,246,673 1,459,431
Compensated absences 759,258 718,149
Deferred amounts:
For issuance discounts (636,356) (709,367)
For issuance premiums 2,351,867 2,314,325
Total business-type activities 176,980,629 189,410,522
Total outstanding debt 233,940,578$ 252,500,251$
Debt Administration.The City, along with the Lansing Building Authority (LBA), a blended component unit of the
City, is empowered by law to authorize, issue, and sell debt obligations. Limited tax and unlimited tax general
obligation bonds are backed by the full faith and credit of the City. The City also issues revenue-dedicated bonded
debt, whose payment for principal and interest comes solely out of funds that receive legally-restricted revenues. The
Sewage Disposal fund has the City’s only dedicated revenue bonds currently outstanding. LBA’s bonds financed the
construction of parking structures, golf courses, and other related improvements. Revenues derived from user fees
from persons using parking and golf facilities fund the debt service requirements for related improvements, but they
are also backed by a limited tax pledge.
The City, along with the LBA, issued $7,085,000 of general obligation limited tax refunding bonds to advance refund
its 2005 Building Authority refunding bonds and $1,770,000 in Lansing Center refunding bonds for interest savings of
$809,000 and 167,000 over the next six years, respectively. The City also issued $1,977,487 in Limited Tax Sewer
Bonds for Combined Sewer Overflow projects. Reductions in the categories listed above are due debt payments made
during the course of the fiscal year. More detailed information regarding these activities and funds can be found in
Footnote 9 of the of the Notes to the Financial Statements section of the CAFR.
Outstanding Debt
24
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Economic Condition and Outlook
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors with a general
overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. Copies of this
financial report, as well as other financial reports, are available on the City's website, www.lansingmi.gov. If you
have any questions about this report or need additional financial information, please feel free to contact the Finance
Department at (517) 483-4500.
Requests for Information
Strengthening the City's economic base, building back up General Fund reserves to pre-Recession levels, and
addressing long-term pension and retiree healthcare obligations are top priorities. The City continues to work
diligently with its employees and unions to address the ongoing structural imbalance between projected revenues and
long-term pension and retiree health care costs and has been successful in achieving significant agreements over the
past several years on a wide range of cost-saving measures. The City, in conjunction with the Mayor-appointed
Financial Health Team made up of volunteer community leaders, issued a request for proposal and awarded a contract
for recommendations earlier this year for addressing long-term pension and retiree healthcare funding obligations in
context of revenue growth limitations. Recommendations are expected from the study in FY 2016/2017.
The City continues to experience significant economic development and national recognition of its economic
development efforts and accomplishments. For more information, please see the "Local Economy" section of the
Transmittal Letter.
Unemployment levels in the City continued to decline in FY 2015/2016, resulting in increased income tax revenue.
Property values increased; however growth in corresponding property tax revenue is limited by State of Michigan
Statute to the rate of inflation for property that does not change hands. Lansing's financial picture as a whole has
stabilized and continues to improve. The 2015/2016 fiscal year resulted in a $2.6 million addition to General Fund
unassigned reserves and a surplus is again expecting in FY 2016/2017, bringing unassigned General Fund reserves up to
$12.4 million, or 10.3% of General Fund expenditures and transfers out -- closer to the City's 12%-15% fund balance
policy. However, significant challenges remain in the longer-term. Going forward, State-imposed limitations on
municipal revenues, most notably those on property tax growth, will continue to constrain resources, which in context
of projected increases in pension, healthcare, and infrastructure needs, will present significant budgetary challenges.
25
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26
BASIC FINANCIAL STATEMENTS
27
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28
GOVERNMENT-WIDE FINANCIAL STATEMENTS
29
Statement of Net Position
June 30, 2016
Governmental Business-type Component
Activities Activities Totals Units
Assets
Cash and investments 34,384,710$ 42,380,927$ 76,765,637$ 4,600,110$
Receivables, net 23,902,340 28,589,430 52,491,770 1,229,203
Internal balances (359,156) 359,156 - -
Due from primary government - - - 2,119,598
Inventories, prepaids and other assets 2,040,029 375,147 2,415,176 161,064
Restricted assets:
Cash and investments - 3,568,818 3,568,818 1,201,198
Capital assets not being depreciated 26,503,312 25,471,055 51,974,367 -
Capital assets being depreciated, net 167,683,973 346,064,908 513,748,881 4,471
Total assets 254,155,208 446,809,441 700,964,649 9,315,644
Deferred outflows of resources
Deferred charge on refunding 149,549 2,627,629 2,777,178 4,048,435
Deferred pension amounts 59,316,094 4,563,213 63,879,307 -
Total deferred outflows of resources 59,465,643 7,190,842 66,656,485 4,048,435
Liabilities
Accounts payable and
accrued liabilities 15,818,252 1,082,098 16,900,350 2,091,597
Accrued interest payable 335,708 941,571 1,277,279 17,021,031
Unearned revenue 396,652 106,286 502,938 291,419
Due to component units 2,119,598 - 2,119,598 -
Long-term liabilities:
Due within one year 6,725,586 14,161,686 20,887,272 784,570
Due in more than one year 50,234,363 162,818,943 213,053,306 29,633,748
Net pension liability 274,678,085 31,230,585 305,908,670 -
Net other postemployment benefit obligation 62,014,884 - 62,014,884 -
Total liabilities 412,323,128 210,341,169 622,664,297 49,822,365
Deferred inflows of resources
Deferred pension amounts 4,376,709 1,055,949 5,432,658 -
Net position
Net investment in capital assets 149,676,860 220,436,882 370,113,742 4,471
Restricted for:
Public safety 1,466,679 - 1,466,679 -
Public works 5,886,114 - 5,886,114 -
Community development 3,514,745 - 3,514,745 -
Building department 286,633 - 286,633 -
Debt service - 2,424,820 2,424,820 -
Capital projects - 340,143 340,143 -
Endowments (nonexpendable) 1,768,354 - 1,768,354 -
Unrestricted (deficit) (265,678,371) 19,401,320 (246,277,051) (36,462,757)
Total net position (103,078,986)$ 242,603,165$ 139,524,179$ (36,458,286)$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
Primary Government
30
Statement of Activities
For the Year Ended June 30, 2016
Operating Capital Net
Charges Grants and Grants and (Expense)
Functions / Programs Expenses for Services Contributions Contributions Revenues
Primary government
Governmental activities:
General government 27,993,414$ 7,279,427$ 2,191,684$ -$ (18,522,303)$
Public safety 85,739,408 2,909,054 5,213,007 - (77,617,347)
Public works 28,212,049 3,011,894 11,355,455 904,298 (12,940,402)
Recreation and culture 10,336,168 673,840 241,388 - (9,420,940)
Community development 10,642,102 67,272 5,560,426 - (5,014,404)
Interest on long-term debt 1,424,215 - - - (1,424,215)
Total governmental activities 164,347,356 13,941,487 24,561,960 904,298 (124,939,611)
Business-type activities:
Sewage disposal system 28,487,957 32,368,491 306,085 - 4,186,619
Municipal parking system 7,651,077 7,090,335 987,941 - 427,199
Cemetery 708,545 312,929 - - (395,616)
Golf 845,575 313,164 18,336 - (514,075)
Garbage and rubbish collection 2,085,728 1,871,665 - - (214,063)
Recycling 4,092,278 3,627,070 - - (465,208)
Total business-type activities 43,871,160 45,583,654 1,312,362 - 3,024,856
Total primary government 208,218,516$ 59,525,141$ 25,874,322$ 904,298$ (121,914,755)$
Component units
Brownfield redevelopment
authority 1,855,832$ -$ 333,702$ -$ (1,522,130)$
Tax increment finance
authority 3,899,919 - - - (3,899,919)
Lansing entertainment &
public facilities authority 7,429,956 6,075,913 1,206,931 - (147,112)
SmartZone 2,612 - - - (2,612)
Total component units 13,188,319$ 6,075,913$ 1,540,633$ -$ (5,571,773)$
continued…
CITY OF LANSING, MICHIGAN
Program Revenues
31
Statement of Activities
For the Year Ended June 30, 2016
Governmental Business-type Component
Activities Activities Totals Units
Changes in net position
Net (expense) revenues (124,939,611)$ 3,024,856$ (121,914,755)$ (5,571,773)$
General revenues:
Property taxes 38,578,548 - 38,578,548 4,894,303
Income taxes 34,573,130 - 34,573,130 -
Grants and contributions not
restricted to specific programs 36,532,275 - 36,532,275 -
Unrestricted investment earnings 99,058 - 99,058 8,459
Gain on sale of capital assets 63,079 3,853 66,932 -
Transfers - internal activities (629,715) 629,715 - -
Total general revenues and transfers 109,216,375 633,568 109,849,943 4,902,762
Change in net position (15,723,236) 3,658,424 (12,064,812) (669,011)
Net position, beginning of year, as restated (87,355,750) 238,944,741 151,588,991 (35,789,275)
Net position, end of year (103,078,986)$ 242,603,165$ 139,524,179$ (36,458,286)$
concluded
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
Primary Government
32
FUND FINANCIAL STATEMENTS
33
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34
CITY OF LANSING, MICHIGAN
Governmental Fund Financial Statements
Major Fund
General Fund - This is the general operating fund of the City. It is used to account for and report
all financial resources not accounted for and reported in another fund.
Nonmajor Funds
Nonmajor governmental funds are presented, by fund type, are within the Combining and Individual
Fund Financial Statements and Schedules section of this report as noted in the table of contents.
35
CITY OF LANSING, MICHIGAN
Balance Sheet
Governmental Funds
June 30, 2016
Nonmajor
Governmental
General Funds Totals
Assets
Cash and cash equivalents 2,450,450$ 157,846$ 2,608,296$
Equity in pooled cash and investments 7,162,425 16,870,847 24,033,272
Investments - 1,700,000 1,700,000
Accounts receivable, net 8,762,983 1,209,159 9,972,142
Taxes receivable 735,014 - 735,014
Special assessments receivable - 393,563 393,563
Loans receivable - 1,428,378 1,428,378
Accrued interest receivable - 2,293,588 2,293,588
Due from other funds - 1,404,970 1,404,970
Due from other governments 4,888,700 3,610,700 8,499,400
Inventories 29,770 809,977 839,747
Prepaids 462,779 - 462,779
Total assets 24,492,121$ 29,879,028$ 54,371,149$
Liabilities
Accounts payable 4,198,065$ 3,409,311$ 7,607,376$
Deposits payable - 17,662 17,662
Accrued payroll 2,617,707 73,024 2,690,731
Retainage payable 255,174 - 255,174
Indemnity bonds - 16,131 16,131
Due to other funds 2,497 1,520,320 1,522,817
Due to component units - 2,119,598 2,119,598
Advances from other funds - 241,309 241,309
Due to other governments 2,165,648 828,989 2,994,637
Unearned revenue 134,031 262,621 396,652
Other 669,417 - 669,417
Total liabilities 10,042,539 8,488,965 18,531,504
Deferred inflows of resources
Unavailable revenues - fees 1,121,179 - 1,121,179
Unavailable revenues - loans and accrued interest receivable - 3,514,745 3,514,745
Unavailable revenues - special assessments - 345,321 345,321
Total deferred inflows of resources 1,121,179 3,860,066 4,981,245
Fund balances
Nonspendable 492,549 2,578,331 3,070,880
Restricted - 6,934,665 6,934,665
Committed 428,106 8,427,253 8,855,359
Unassigned (deficit) 12,407,748 (410,252) 11,997,496
Total fund balances 13,328,403 17,529,997 30,858,400
Total liabilities, deferred inflows of
resources and fund balances 24,492,121$ 29,879,028$ 54,371,149$
The accompanying notes are an integral part of the financial statements.
36
CITY OF LANSING, MICHIGAN
Reconciliation
Fund Balances of Governmental Funds
to Net Position of Governmental Activities
June 30, 2016
Fund balances - total governmental funds 30,858,400$
Capital assets not being depreciated 26,503,312
Capital assets being depreciated, net 167,683,973
Capital assets accounted for in internal service funds, net (12,293,786)
Deferred ambulance fees receivable 605,208
Deferred nuisance fees receivable 453,317
Deferred loans receivable 1,228,378
Deferred long-term interest receivable 2,286,367
Deferred long-term special assessments receivable 345,321
Deferred long-term taxes and tax settlement receivables 62,654
12,510,762
Bonds, loans and leases payable (40,354,089)
Deferred charge on refunding 149,549
Accrued interest on bonds, loans and leases payable (302,220)
Net other postemployment benefit obligation (62,014,884)
Compensated absences and other long-term liabilities (11,062,548)
Net pension liability (274,678,085)
Deferred outflows related to the net pension liability 59,316,094
Deferred inflows related to the net pension liability (4,376,709)
Net position of governmental activities (103,078,986)$
The accompanying notes are an integral part of the financial statements.
Certain pension-related amounts, such as the net pension liability and deferred amounts, are not due and
payable in the current period or do not represent current financial resources and therefore are not reported
in the funds.
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in
the funds.
Because the focus of governmental funds is on short-term financing, some assets will not be available to pay
for current expenditures. Those assets (i.e., receivables) are offset by deferred inflows of resources in the
governmental funds and, therefore, are not included in fund balance.
Internal service funds are used by management to charge the costs of certain equipment maintenance to
individual funds. The assets and liabilities of the internal service funds are included in governmental
activities in the statement of net position.
Long-term liabilities and related deferred outflows are not due and payable in the current period and
therefore are not reported in the funds.
37
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2016
Nonmajor
Governmental
General Funds Totals
Revenues
Taxes and special assessments 37,712,911$ 1,069,848$ 38,782,759$
Income taxes 34,573,130 - 34,573,130
Licenses and permits 1,559,638 - 1,559,638
Intergovernmental 15,431,325 18,743,787 34,175,112
Charges for services 8,523,221 5,579,226 14,102,447
Fines and forfeits 2,835,155 620,386 3,455,541
Interest and rents 69,939 75,072 145,011
Contributions 21,653,690 10,000 21,663,690
Other revenues 198,729 991,895 1,190,624
Total revenues 122,557,738 27,090,214 149,647,952
Expenditures
Current expenditures:
General government 20,033,578 3,352,867 23,386,445
Public safety 70,443,729 1,820,739 72,264,468
Public works 10,823,830 891,680 11,715,510
Highways and streets - 10,838,473 10,838,473
Recreation and culture 7,719,906 - 7,719,906
Community development - 3,442,110 3,442,110
Other functions 2,927,391 - 2,927,391
Debt service:
Principal 1,182,862 2,710,000 3,892,862
Interest 579,344 696,613 1,275,957
Capital outlay 186,146 7,035,200 7,221,346
Total expenditures 113,896,786 30,787,682 144,684,468
Revenues over (under) expenditures 8,660,952 (3,697,468) 4,963,484
Other financing sources (uses)
Transfers in 387,290 8,820,566 9,207,856
Transfers out (6,395,290) (3,660,056) (10,055,346)
Proceeds on sale of capital assets 268 - 268
Issuance of long-term debt 1,770,000 320,000 2,090,000
Bond premium 68,153 12,022 80,175
Payment to refunded bond escrow agent (1,830,110) (332,053) (2,162,163)
Total other financing sources (uses)(5,999,689) 5,160,479 (839,210)
Net change in fund balances 2,661,263 1,463,011 4,124,274
Fund balances, beginning of year 10,667,140 16,066,986 26,734,126
Fund balances, end of year 13,328,403$ 17,529,997$ 30,858,400$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
38
Reconciliation
Net Changes in Fund Balances of Governmental Funds
to Change in Net Position of Governmental Activities
For the Year Ended June 30, 2016
Net changes in fund balances - total governmental funds 4,124,274$
Capital assets purchased/constructed 3,758,133
Depreciation expense (9,452,903)
Loss on sale of capital assets (125,649)
Proceeds on sale of capital assets (268)
Change in deferred ambulance fees receivable (362,705)
Change in deferred nuisance fees receivable 88,520
Change in deferred loans receivable (1,978)
Change in deferred long-term interest receivable 69,250
Change in deferred special assessments receivable (105,262)
Change in deferred taxes and tax settlement receivables (197,182)
Net operating income from governmental activities in internal service funds 3,235,007
Gain on sale of capital assets from governmental internal service funds 63,079
Interest expense from governmental internal service funds (175,521)
Transfers in from governmental internal service funds 1,000,000
Transfers out of governmental internal service funds (782,225)
Issuance of long-term debt (2,090,000)
Principal payments on long-term liabilities 3,892,862
Premium on bond issuances (80,175)
Payments to refunded bond escrow agent 2,162,163
Change in estimated liability for workers' compensation 1,120,891
Change in accrued interest payable on long-term liabilities 10,306
Amortization of issuance premiums and discounts, and deferred charge on refunding 16,957
Change in net other postemployment benefit obligation (5,030,748)
Change in net pension liability and related deferral amounts (16,908,817)
Change in the accrual for compensated absences (3,406)
Change in the accrual for tax settlement agreement 52,161
Change in net position of governmental activities (15,723,236)$
The accompanying notes are an integral part of the financial statements.
Debt proceeds provide current financial resources to governmental funds in the period issued, but issuing
debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an
expenditure in the funds, but the repayment reduces long-term liabilities in the statement of net position.
Certain expenditures are reported in governmental funds that reduce long-term liabilities for purposes of the
statement of net position.
Some expenses reported in the statement of activates do not require the use of current financial resources
and therefore are not reported as expenditures in the funds.
CITY OF LANSING, MICHIGAN
Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlay as expenditures. However, in the statement of activities, the cost
of those assets is allocated over their estimated useful lives as depreciation expense.
Revenues in the statement of activities that do not provide current financial resources are not reported as
revenues in the funds, but rather are deferred to subsequent fiscal years.
Internal service funds are used by management to charge the costs of certain equipment maintenance to
individual funds. The net increase (decrease) in the net position of the internal service funds is reported
with governmental activities.
39
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - General Fund
For the Year Ended June 30, 2016
Actual Over
Original Final (Under) Final
Budget Budget Actual Budget
Revenues
Property taxes 38,100,000$ 38,100,000$ 37,712,911$ (387,089)$
Income taxes 32,150,000 32,880,000 34,573,130 1,693,130
Licenses and permits 1,574,500 1,562,500 1,559,638 (2,862)
Intergovernmental 15,738,000 15,998,000 15,431,325 (566,675)
Charges for services 8,690,400 9,149,400 8,523,221 (626,179)
Fines and forfeits 2,542,100 2,542,100 2,835,155 293,055
Interest and rents 36,500 36,500 69,939 33,439
Contributions - 21,819,619 21,653,690 (165,929)
Other revenues 21,683,500 121,000 198,729 77,729
Total revenues 120,515,000 122,209,119 122,557,738 348,619
Expenditures
General government:
Attorney's office 1,915,800 1,765,800 1,657,029 (108,771)
City clerk 1,060,000 1,245,000 1,165,243 (79,757)
Council 706,400 701,400 676,750 (24,650)
Courts 6,313,200 6,213,200 6,029,906 (183,294)
Internal audit 209,200 189,200 173,011 (16,189)
Finance 5,092,600 4,969,474 4,652,352 (317,122)
Library rental 165,000 165,000 144,155 (20,845)
LEPFA support 331,400 1,206,930 1,206,930 -
Human resources 2,052,900 2,052,900 1,973,076 (79,824)
Mayor 1,230,100 1,130,100 1,007,050 (123,050)
Office of community media 394,200 394,200 377,189 (17,011)
Office of financial empowerment 60,000 60,000 63,835 3,835
Planning / neighborhood development 910,600 910,600 907,052 (3,548)
Budgetary savings from attrition (800,000) - - -
Total general government 19,641,400 21,003,804 20,033,578 (970,226)
Public safety:
Police 37,801,800 37,644,600 37,298,382 (346,218)
Fire 33,840,200 33,725,200 33,145,347 (579,853)
Total public safety 71,642,000 71,369,800 70,443,729 (926,071)
Public works 10,373,700 10,803,700 10,823,830 20,130
Recreation and culture 7,891,400 7,841,400 7,719,906 (121,494)
continued…
40
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - General Fund
For the Year Ended June 30, 2016
Actual Over
Original Final (Under) Final
Budget Budget Actual Budget
Expenditures (concluded)
Other functions:
Human relations / community services 1,128,200$ 1,098,200$ 1,021,279$ (76,921)$
Human services / community support 1,520,000 2,084,414 1,906,112 (178,302)
Total other functions 2,648,200 3,182,614 2,927,391 (255,223)
Debt service:
Principal 800,000 1,175,100 1,182,862 7,762
Interest 207,100 583,768 579,344 (4,424)
Total debt service 1,007,100 1,758,868 1,762,206 3,338
Capital outlay - 423,871 186,146 (237,725)
Total expenditures 113,203,800 116,384,057 113,896,786 (2,487,271)
Revenues over expenditures 7,311,200 5,825,062 8,660,952 2,835,890
Other financing sources (uses)
Transfers in 85,000 385,000 387,290 2,290
Transfers out (7,396,200) (6,485,956) (6,395,290) (90,666)
Proceeds on sale of capital assets - 10,000 268 (9,732)
Issuance of long-term debt - 1,770,000 1,770,000 -
Bond premium - 68,153 68,153 -
Payment to refunded bond escrow agent - (1,830,110) (1,830,110) -
Total other financing sources (uses)(7,311,200) (6,082,913) (5,999,689) 83,224
Net change in fund balance - (257,851) 2,661,263 2,919,114
Fund balance, beginning of year 10,667,140 10,667,140 10,667,140 -
Fund balance, end of year 10,667,140$ 10,409,289$ 13,328,403$ 2,919,114$
concluded
The accompanying notes are an integral part of the financial statements.
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42
CITY OF LANSING, MICHIGAN
Proprietary Fund Financial Statements
Major Funds
Sewage Disposal System Fund - This fund accounts for the provision of sewage disposal services to the
residents of the City.
Municipal Parking System Fund - This fund accounts for the operation of City-owned parking facilities.
Nonmajor Funds and Internal Service Funds
Nonmajor enterprise funds and internal service funds are presented, by fund type, are within the
Combining and Individual Fund Financial Statements and Schedules section of this report as noted in the
table of contents.
43
Statement of Net Position
Proprietary Funds
June 30, 2016
Governmental
Business-type Activities - Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Assets
Current assets:
Cash and cash equivalents 5,433,665$ 576,965$ 947$ 6,011,577$ 57,842$
Equity in pooled cash and investments 25,392,757 9,164,910 1,811,683 36,369,350 5,985,300
Accounts receivable, net 5,460,023 354,134 84,677 5,898,834 580,255
Accrued interest receivable 46,237 85,850 - 132,087 -
Lease receivable, current 631,084 -- 631,084 -
Loans receivable, current - 63,848 - 63,848 -
Inventories 311,083 - 63,464 374,547 374,891
Prepaids - 600 - 600 362,612
Due from other funds 2,695,492 15,790 - 2,711,282 -
Total current assets 39,970,341 10,262,097 1,960,771 52,193,209 7,360,900
Noncurrent assets:
Restricted cash and cash equivalents 3,228,675 340,143 - 3,568,818 -
Advances to other funds - 241,309 - 241,309 -
Lease receivable, net of current portion 8,155,351 13,708,226 - 21,863,577 -
Capital assets not being depreciated 12,407,894 12,558,920 504,241 25,471,055 92,892
Capital assets being depreciated, net 325,615,803 17,306,891 3,142,214 346,064,908 12,200,894
Total noncurrent assets 349,407,723 44,155,489 3,646,455 397,209,667 12,293,786
Total assets 389,378,064 54,417,586 5,607,226 449,402,876 19,654,686
Deferred outflows of resources
Deferred charge on refunding 1,188,986 1,436,346 2,297 2,627,629 -
Deferred pension amounts 2,304,129 803,066 1,456,018 4,563,213 -
Total deferred outflows of resources 3,493,115 2,239,412 1,458,315 7,190,842 -
Liabilities
Current liabilities:
Accounts payable 708,588 32,465 155,130 896,183 775,848
Deposits payable - 58,375 - 58,375 -
Accrued interest payable 803,855 131,397 6,319 941,571 33,488
Accrued payroll 69,641 33,476 24,423 127,540 135,212
Claims incurred but not reported - - - - 656,064
Due to other funds 2,591,138 -2,297 2,593,435 -
Unearned revenues - - 106,286 106,286 -
Bonds and notes payable, current portion 11,805,073 1,920,000 321,950 14,047,023 893,799
Compensated absences, current portion 94,008 20,655 - 114,663 37,591
Total current liabilities 16,072,303 2,196,368 616,405 18,885,076 2,532,002
Noncurrent liabilities:
Bonds and notes payable, net of current portion 127,793,558 33,351,067 1,029,723 162,174,348 3,861,359
Compensated absences, net of current portion 298,139 94,309 252,147 644,595 750,563
Net pension liability 15,769,435 5,496,177 9,964,973 31,230,585 -
Total noncurrent liabilities 143,861,132 38,941,553 11,246,843 194,049,528 4,611,922
Total liabilities 159,933,435 41,137,921 11,863,248 212,934,604 7,143,924
Deferred inflows of resources
Deferred pension amounts 533,186 185,833 336,930 1,055,949 -
Net position
Net investment in capital assets 208,400,487 9,739,316 2,297,079 220,436,882 7,538,628
Restricted for debt retirement 2,424,820 - - 2,424,820 -
Restricted for capital projects - 340,143 - 340,143 -
Unrestricted (deficit) 21,579,251 5,253,785 (7,431,716) 19,401,320 4,972,134
Total net position 232,404,558$ 15,333,244$ (5,134,637)$ 242,603,165$ 12,510,762$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
44
Statement of Revenues, Expenses and Changes in Fund Net Position
Proprietary Funds
For the Year Ended June 30, 2016
Governmental
Business-type Activities - Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Operating revenues
Charges for services 32,368,491$ 7,090,335$ 6,124,828$ 45,583,654$ 79,047,421$
Operating expenses
Personal services 7,109,786 2,809,797 4,248,079 14,167,662 7,819,105
Purchase of goods and services 7,416,804 1,269,689 2,856,314 11,542,807 65,949,522
Depreciation 10,288,817 2,206,999 379,505 12,875,321 2,043,787
Total operating expenses 24,815,407 6,286,485 7,483,898 38,585,790 75,812,414
Operating income (loss) 7,553,084 803,850 (1,359,070) 6,997,864 3,235,007
Nonoperating revenues (expenses)
Interest revenue 306,085 - 18,336 324,421 -
Gain on sale of capital assets 1,606 2,247 - 3,853 63,079
Interest expense and fees (3,672,550) (1,364,592) (33,742) (5,070,884) (175,521)
Capital contribution to others - - (214,486) (214,486) (181,638)
Other revenues - 987,941 - 987,941 -
Total nonoperating revenue (expenses)(3,364,859) (374,404) (229,892) (3,969,155) (294,080)
Income (loss) before transfers 4,188,225 429,446 (1,588,962) 3,028,709 2,940,927
Transfers
Transfers in - - 951,497 951,497 1,000,000
Transfers out (300,000) - (21,782) (321,782) (782,225)
Total transfers (300,000) - 929,715 629,715 217,775
Change in net position 3,888,225 429,446 (659,247) 3,658,424 3,158,702
Net position, beginning of year 228,516,333 14,903,798 (4,475,390) 238,944,741 9,352,060
Net position, end of year 232,404,558$ 15,333,244$ (5,134,637)$ 242,603,165$ 12,510,762$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
45
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2016
Governmental
Business-type Activities - Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Cash flows from operating activities
Cash received from customers 34,280,583$ 7,071,512$ 6,022,525$ 47,374,620$ -$
Cash received from interfund services - - - - 79,329,036
Cash payments for goods and services (8,092,838) (1,298,557) (2,861,967) (12,253,362) (66,569,019)
Cash payments to employees (6,630,068) (2,638,162) (3,933,138) (13,201,368) (7,857,442)
Net cash provided by (used in) operating activities 19,557,677 3,134,793 (772,580) 21,919,890 4,902,575
Cash flows from noncapital financing activities
Transfers in - - 951,497 951,497 1,000,000
Transfers out (300,000) - (21,782) (321,782) (782,225)
Cash received on interfund advances - 100,781 - 100,781 -
Net cash provided by (used in)
noncapital financing activities (300,000) 100,781 929,715 730,496 217,775
Cash flows from capital and related financing activities
Proceeds from sale of capital assets 1,606 2,247 - 3,853 63,079
Acquisition and construction of capital assets (1,647,945) (181,417) - (1,829,362) (1,463,488)
Capital contributions to others - - (214,486) (214,486) -
Proceeds from issuance of long-term debt 1,977,487 6,765,000 - 8,742,487 -
Principal paid on long-term debt (12,236,284) (1,795,000) (312,758) (14,344,042) (1,026,148)
Interest paid on long-term debt (3,802,710) (1,281,996) (32,487) (5,117,193) (177,632)
Amount paid to refunding bond escrow agent - (7,019,806) - (7,019,806) -
Premium on issuance of long-term debt - 254,156 - 254,156 -
Payments received on capital lease 621,442 - - 621,442 -
Net cash used in capital and related
financing activities (15,086,404) (3,256,816) (559,731) (18,902,951) (2,604,189)
Cash flows from investing activities
Interest and dividends received 309,288 23,746 18,336 351,370 -
Payments received on loans made to others - 331,911 - 331,911 -
Net cash provided by investing activities 309,288 355,657 18,336 683,281 -
Net change in cash and cash equivalents 4,480,561 334,415 (384,260) 4,430,716 2,516,161
Cash and cash equivalents, beginning of year 29,574,536 9,747,603 2,196,890 41,519,029 3,526,981
Cash and cash equivalents, end of year 34,055,097$ 10,082,018$ 1,812,630$ 45,949,745$ 6,043,142$
Reconciliation to statement of net position
Cash and cash equivalents 5,433,665$ 576,965$ 947$ 6,011,577$ 57,842$
Equity in pooled cash and investments 25,392,757 9,164,910 1,811,683 36,369,350 5,985,300
Restricted cash and cash equivalents 3,228,675 340,143 - 3,568,818 -
34,055,097$ 10,082,018$ 1,812,630$ 45,949,745$ 6,043,142$
continued…
CITY OF LANSING, MICHIGAN
46
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2016
Governmental
Business-type Activities - Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
CITY OF LANSING, MICHIGAN
Reconciliation of operating income (loss) to net cash
provided by (used in) operating activities
Operating income (loss)7,553,084$ 803,850$ (1,359,070)$ 6,997,864$ 3,235,007$
Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:
Depreciation expense 10,288,817 2,206,999 379,505 12,875,321 2,043,787
Change in:
Accounts receivable 29,544 (28,213) (18,720) (17,389) 281,615
Inventories (23,609) - 36,583 12,974 52,993
Prepaids - (200) - (200) 43,632
Due from other funds 1,882,548 9,390 - 1,891,938 -
Accounts payable (652,425) (19,278) 60,738 (610,965) (16,122)
Deposits payable - - (4,140) (4,140) -
Accrued payroll 4,599 3,684 5,770 14,053 29,677
Claims incurred but not reported - - - - (48,841)
Due to other funds - (9,390) (102,974) (112,364) (700,000)
Unearned revenues - - (79,443) (79,443) -
Compensated absences 15,056 7,604 18,449 41,109 (19,173)
Net pension liability and related deferred amounts 460,063 160,347 290,722 911,132 -
Net cash provided by (used in) operating activities 19,557,677$ 3,134,793$ (772,580)$ 21,919,890$ 4,902,575$
concluded
The accompanying notes are an integral part of the financial statements.
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CITY OF LANSING, MICHIGAN
Fiduciary Fund Financial Statements
Pension and Other Postemployment Benefit Trust Funds -Employee pension and other postemployment
benefit trust funds accept payments made by the City, invest fund resources, calculate and pay pensions
to retirees (or beneficiaries), and account for postemployment healthcare coverage.
Combining schedules for fiduciary funds are presented in the notes to the financial statements.
Agency Funds - These funds account for resources held in a trustee or agent capacity for the 54-A District
Court.
Combining statements for agency funds are presented, by fund type are within the Combining and
Individual Fund Financial Statements and Schedules section of this report as noted in the table of
contents.
49
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2016
Pension
and Other
Postemployment
Benefits Trust Agency
Funds Funds
Assets
Cash and cash equivalents 2,000$ -$
Equity in pooled cash and investments - 67,738
Investments:
Money market funds 7,099,485
Government obligations 53,946,205 -
Corporate bonds 56,776,959 -
Common stocks 121,639,469 -
Private equity partnerships 17,253,511 -
Mutual funds 260,793,968 -
Contribution receivable 1,312,208 -
Dividends and interest receivable 428,766 -
Total assets 519,252,571 67,738$
Liabilities
Accounts payable 1,440,697 -$
Undistributed receipts - 67,738
Total liabilities 1,440,697 67,738$
Net position restricted for
Pension benefits 439,194,779
Other postemployment benefits 78,617,095
Total net position 517,811,874$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
50
Statement of Changes in Fiduciary Net Position
Pension and Other Postemployment Benefits Trust Funds
For the Year Ended June 30, 2016
Additions
Investment income (loss):
Net depreciation in fair value
of investments (5,678,747)$
Interest income 2,070,006
Dividend income 1,933,620
Investment expenses (6,464)
Net investment income (loss) (1,681,585)
Contributions:
Employer 44,284,624
Plan members 3,746,974
Total contributions 48,031,598
Total additions 46,350,013
Deductions
Participant benefits 72,261,499
Administrative expense 1,942,776
Total deductions 74,204,275
Change in net position (27,854,262)
Net position restricted for pension and other postemployment benefits
Beginning of year 545,666,136
End of year 517,811,874$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
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52
COMPONENT UNITS
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CITY OF LANSING, MICHIGAN
Discretely Presented Component Units
Discretely presented component units are entities that are legally separate from the City but for
which the City is financially accountable, or their relationship with the City is such that exclusion
would cause the City’s financial statements to be misleading or incomplete. The City has four
discretely presented component units:
Brownfield Redevelopment Authority
Tax Increment Finance Authority
Lansing Entertainment and Public Facilities Authority
SmartZone
Complete financial statements for each of the individual component units, excluding SmartZone,
may be obtained from the entity's administrative offices. Separately-issued financial statements
are not prepared for the SmartZone.
55
Combining Statement of Net Position
Discretely Presented Component Units
June 30, 2016
Lansing
Tax Entertainment
Brownfield Increment & Public
Redevelopment Finance Facilities
Authority Authority Authority SmartZone Totals
Assets
Cash and cash equivalents 970,759$ 3,404,813$ 224,538$ -$ 4,600,110$
Receivables, net 410,032 - 819,171 - 1,229,203
Due from primary government 1,150,064 969,534 - - 2,119,598
Inventories, prepaids and other assets - - 161,064 - 161,064
Restricted cash and cash equivalents - 364,246 836,952 - 1,201,198
Capital assets being depreciated, net - - 4,471 - 4,471
Total assets 2,530,855 4,738,593 2,046,196 - 9,315,644
Deferred outflows of resources
Deferred charge on refunding - 4,048,435 - - 4,048,435
Liabilities
Accounts payable and
accrued liabilities 1,445,997 19,082 626,518 - 2,091,597
Accrued interest payable - 17,021,031 - - 17,021,031
Unearned revenues - - 291,419 - 291,419
Long-term debt:
Due within one year 63,849 720,721 - - 784,570
Due in more than one year - 29,633,748 - - 29,633,748
Total liabilities 1,509,846 47,394,582 917,937 - 49,822,365
Net position
Investment in capital assets - - 4,471 - 4,471
Unrestricted (deficit) 1,021,009 (38,607,554) 1,123,788 - (36,462,757)
Total net position 1,021,009$ (38,607,554)$ 1,128,259$ -$ (36,458,286)$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
56
Combining Statement of Activities
Discretely Presented Component Units
For the Year Ended June 30, 2016
Lansing
Tax Entertainment
Brownfield Increment & Public
Redevelopment Finance Facilities
Authority Authority Authority SmartZone Totals
Expenses
Brownfield redevelopment 1,855,832$ -$ -$ -$ 1,855,832$
Community development - 3,899,919 - 2,612 3,902,531
Recreation and culture - - 7,429,956 - 7,429,956
Total expenses 1,855,832 3,899,919 7,429,956 2,612 13,188,319
Program revenues
Charges for services - - 6,075,913 - 6,075,913
Operating grants and contributions 333,702 - 1,206,931 - 1,540,633
Total program revenues 333,702 - 7,282,844 - 7,616,546
Net program expense (1,522,130) (3,899,919) (147,112) (2,612) (5,571,773)
General revenues
Property taxes 1,600,095 2,955,764 338,444 - 4,894,303
Unrestricted investment earnings 1,626 6,646 187 - 8,459
Total general revenues 1,601,721 2,962,410 338,631 - 4,902,762
Changes in net position 79,591 (937,509) 191,519 (2,612) (669,011)
Net position, beginning of year, as restated 941,418 (37,670,045) 936,740 2,612 (35,789,275)
Net position, end of year 1,021,009$ (38,607,554)$ 1,128,259$ -$ (36,458,286)$
The accompanying notes are an integral part of the financial statements.
CITY OF LANSING, MICHIGAN
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58
NOTES TO FINANCIAL STATEMENTS
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60
CITY OF LANSING, MICHIGAN
Index - Notes to Financial Statements
Page
1. Summary of Significant Accounting Policies 62
Reporting Entity
Government-wide and Fund Financial Statements
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Equity
2. Budgetary Information 72
3. Deficit Fund Equity 73
4. Deposits and Investments 74
5. Receivables 80
6. Capital Assets 82
7.Accounts Payable and Accrued Liabilities 84
8. Interfund Receivables, Payables and Transfers 84
9. Long-Term Debt 86
10.Fund Balances - Governmental Funds 90
11.Net Investment in Capital Assets 91
12.Segment Information - Enterprise Funds 91
13.Risk Management 92
14.Property Taxes 93
15.Contingent Liabilities 93
16.Pension Plans 93
17.Other Postemployment Benefits 107
18.Operating Leases 111
19.Restatement 112
61
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Lansing (the “City”) was incorporated in 1859. In 1909, the City came under the provisions of
Act 279, P.A. 1909, as amended (“Home Rule City Act”). The City operates under a strong Mayor form of
government in which the Mayor is responsible for implementation and administration of City policy as
established by City Council.
The accounting and reporting policies of the City conform in all material respects to generally accepted
accounting principles (GAAP) as applicable to governments. The Governmental Accounting Standards Board
(GASB) is the standard setting body for establishing governmental accounting and financial reporting
principles, which are primarily set forth in the GASB’s Codification of Governmental Accounting and
Financial Reporting Standards (GASB Codification). Following is a summary of the significant policies:
Reporting Entity
As required by generally accepted accounting principles, these financial statements present the City and its
component units, entities for which the City is considered to be financially accountable. The financial data
of the component units are included in the City’s reporting entity because of the significance of their
operational or financial relationships with the City.
Blended Component Unit
A blended component unit is a legally separate entity from the City but is so intertwined with the City that
it is, in substance, the same as the City. It is reported as part of the City and its financial data is combined
with data of the appropriate funds. The City has one blended component unit, the Building Authority with a
fiscal June 30 year-end. This component unit provides services primarily to benefit the City. The blended
unit is described as follows:
The Building Authority (the “Authority”) was established by the City under Act 31, Michigan Public Acts of
1948. The Mayor, with the advice and consent of City Council, appoints the Authority's governing body and
designates management. The Authority uses the proceeds of its tax-exempt bonds to finance the
construction or acquisition of capital assets for the City only. The bonds are secured by lease agreements
with the City and will be retired through lease payments from the City. The financial activity, assets,
liabilities and equity of the Authority are incorporated within the City’s Municipal Parking System and Golf
enterprise funds, and the 2015 Refunding Debt Service Fund.
Discretely Presented Component Units
Discretely presented component units are entities that are legally separate from the City but for which the
City is financially accountable, or their relationship with the City is such that exclusion would cause the
City’s financial statements to be misleading or incomplete. The discretely presented component units are
as follows:
62
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Lansing Regional SmartZone (“SmartZone”) was established by the City of Lansing and the City of East
Lansing under the authority contained in Act 281, Public Act of Michigan of 1986 (“Act 281”). Act 281
authorizes the cities to create a multi-jurisdictional local development finance authority. The SmartZone
shall be known and exercise its powers under title of the Local Development Finance Authority of the Cities
of Lansing and East Lansing. The SmartZone is fiscally dependent on the City of Lansing; the City approves
the annual budget and is responsible for managing the SmartZone. The SmartZone was created in order to
eliminate the conditions of unemployment, underemployment and joblessness, and to promote economic
growth in the City. The SmartZone’s Board of Commissioners consists of seven members, three of which are
appointed by the City of Lansing, three are appointed by the City of East Lansing, and one is appointed by
the Ingham County Board of Commissioners. The SmartZone was dissolved as of June 30, 2016.
Tax increment financing permits the LBRA to capture tax revenues which are attributable to increases in
the value of real and personal property located within an approved project area. Current activities of the
LBRA include collections of property tax revenues on project areas for the Rite Aid Pharmacy and the
former Motor Wheel Site Plant.
The Tax Increment Finance Authority (“TIFA”) was established by the City under the authority contained
in Act 450, Michigan Public Acts of 1981 (“Act 450”). Act 450 authorizes the City to designate specific
districts within its corporate limits as TIFA districts. The TIFA presides over such districts, formulating plans
for public improvements, economic development, neighborhood revitalization, and historic preservation
within the districts. Act 450 allows the TIFA to participate in a broad range of improvement activities
intended to contribute to economic growth and prevent property value deterioration. The TIFA’s governing
body is appointed by the Mayor with the advice and consent of the City Council. Bond issuances, to fund the
above activities, are approved by the City Council and the legal liability for the debt remains with the City.
The Lansing Entertainment and Public Facilities Authority (“LEPFA”) was established under the charter of
the City of Lansing, Michigan in February 1996, replacing the former Greater Lansing Convention/Exhibition
Authority, which had been responsible for operating and managing the Lansing Center and the Lansing Civic
Arena (the latter through the fiscal year ended June 30, 1995). LEPFA was established to oversee the
management and operations of the Lansing Center, the City Market and the Cooley Law School stadium.
LEPFA is chartered as a building authority under the provisions of Act 31, Public Acts of Michigan, 1948. In
the event of dissolution or termination of LEPFA, all assets and rights of the Authority shall revert to the
City. LEPFA’s Board of Commissioners consists of thirteen members appointed by the Mayor of the City of
Lansing and approved by the City Council.
The Lansing Brownfield Redevelopment Authority ("LBRA") was established by the City on August 17, 1997,
under the authority contained in Act 381, Michigan Public Acts of 1996 (the “Act”). The Act authorizes the
City to establish and to designate the boundaries of a Brownfield redevelopment zone. The Brownfield
Redevelopment Authority is appointed by City Council to preside over such a zone, and it is authorized to
promote the revitalization of environmentally distressed areas within the City of Lansing. The Act allows
the LBRA to participate in a broad range of improvement activities intended to encourage the reuse of
industrial and commercial property by offering economic incentives for redevelopment to prevent property
value deterioration. Tax increment financing plans must be approved by the City.
63
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Government-wide and Fund Financial Statements
8th Floor
124 West Michigan Avenue
Lansing, Michigan 48933
1000 S Washington Avenue, Suite 201
Lansing, Michigan 48910
333 East Michigan Avenue
Lansing, Michigan 48933
Joint Venture
In 1998, the City entered into an agreement with Ingham County (the "County") to form the City of Lansing
and County of Ingham Joint Building Authority (JBA) for the purpose of constructing and managing a building
in downtown Lansing that houses the courts, prosecuting attorney and other related departments. The JBA
is governed by a three-member board composed of one member each appointed by the City and the County
and one appointed jointly by the two units. Both the County and the City contribute cash and/or property
to the JBA. Bonds were issued in 1999 by the JBA to provide the funding necessary to construct the
building. Because the joint venture agreement does not provide an explicit contractual formula outlining
the City's claim to the JBA's assets, it is considered to be a "joint venture with no equity interest" and
accordingly, no amounts are reported in the accompanying financial statements for an equity interest.
Financial information for the JBA may be obtained by writing the Ingham County Financial Services Division,
P.O. Box 319, Mason, Michigan 48854.
The government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the nonfiduciary activities of the primary government and its
component units. 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. Likewise, the primary government is reported separately from certain component
units for which the primary government is financially accountable.
The statement of activities demonstrates the degree to which the direct expenses of a given function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Program revenues include (1) charges to customers or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided by a given function or
segment and (2) grants and contributions that are restricted to meeting the operational or capital
requirements of a particular function or segment. Taxes and other items not properly included among
program revenues are reported instead as general revenues.
Component Unit Financial Statements
City of Lansing Building Authority
Lansing Entertainment and Public Facilities Authority
Complete financial statements for the individual component units may be obtained from each entity’s
administrative offices. Separate financial statements are not prepared for the SmartZone.
Brownfield Redevelopment Authority / Tax Increment Finance Authority
64
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The City reports the following major enterprise funds:
Sewage Disposal System Fund.This fund accounts for the provision of sewage disposal services to the
residents of the City.
Municipal Parking System Fund. This fund accounts for the operation of City-owned parking facilities.
The City reports the following major governmental fund:
General fund.This fund is the City’s primary operating fund. It accounts for all the financial resources
of the primary government, except those accounted for and reported in another fund.
Property taxes, intergovernmental revenue, licenses, and interest associated with the current fiscal period
are all considered to be susceptible to accrual and as such have been recognized as revenues of the current
fiscal period. Only the portion of special assessments receivable due within the current fiscal period is
considered to be susceptible to accrual as revenue of the current period. All other revenue items are
considered to be measurable and available only when cash is received by the City.
Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds,
even though the latter are excluded from the government-wide financial statements. Major individual
governmental funds and major individual enterprise funds are reported as separate columns in the fund
financial statements.
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements.
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 imposed by
the provider have been met. Agency funds, a type of fiduciary fund, are unlike all other types of funds,
reporting only assets and liabilities. Therefore, agency funds cannot be said to have a measurement focus.
They do, however, use the accrual basis of accounting to recognize receivables and payables.
Governmental funds are reported using the current financial resources measurement focus and the modified
accrual basis of accounting. Under this method, revenues are recognized when 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. The City considers all revenues reported in the
governmental funds to be available if they are collected within three months after year-end, except for
income taxes that use a 45-day collection period, property taxes that use a 60-day collection period, and
reimbursement-based grants that use one year. 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 judgments, are recorded only when payment is due.
65
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Capital Projects Funds are used to account for and report financial resources that are restricted,
committed, or assigned to expenditure for capital outlays, including the acquisition or construction of
capital facilities and other capital assets.
Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that
are restricted or committed to expenditure for specified purposes other than debt service or capital
projects that comprise, or are expected to comprise a substantial portion of the fund's total reported
inflows.
Additionally, the City reports the following fund types:
Debt Service Funds are used to account for and report financial resources that are restricted,
committed, or assigned to expenditure for principal, interest and related costs.
Internal Service Funds account for operations that provide services to other departments or agencies of
the City, or to other governments, on a cost-reimbursement basis. This includes operating a maintenance
facility for trucks and equipment used by the Public Service Department, health care and self-insurance
services, and information technology.
Enterprise Funds account for those operations that are financed and operated in a manner similar to
private business or where the City has decided that the determination of revenues earned, costs incurred
and/or net income is necessary for management accountability.
Permanent Funds account for resources that are legally restricted to the extent that only earnings, and
not principal, may be used for purposes that support the government’s programs.
Pension and Other Postemployment Benefit Trust Funds account for the accumulation of resources to be
used for retirement annuity payments to eligible full-time employees of the City, certain healthcare
costs, and other retirement distributions.
As a general rule the effect of interfund activity has been eliminated from the government-wide financial
statements. Exceptions to this general rule are payments in lieu of taxes and various other functions of the
government. Elimination of these charges would distort the direct costs and program revenues reported for
the various functions concerned.
The Agency Fund account for resources held in a fiduciary capacity for the 54-A District Court.
Proprietary funds distinguish operating revenues and expenses from nonoperating 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
City’s enterprise and internal service funds are charges to customers for sales and services. Operating
expenses for enterprise funds 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 nonoperating revenues and expenses.
66
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Equity
Deposits and Investments
Bankers’ acceptances of United States banks.
External investment pools as authorized by Public Act 20 as amended through December 31, 1997.
Mutual funds registered under the Investment Company Act of 1940 with the authority to purchase only
investment vehicles that are legal for direct investment by a public corporation.
Restricted net position are assets that are subject to restrictions beyond the government’s control. The
restrictions may be externally imposed or imposed by law. When both restricted and unrestricted resources
are available for use, it is the government’s policy to use restricted resources first, then unrestricted
resources as they are needed.
State statutes authorize the City to invest in:
Obligations of the State of Michigan and its political subdivisions, that, at the time of purchase are rated
as investment grade by at least one standard rating service.
Certificates of deposit, savings accounts, deposit accounts or depository receipts of a qualified financial
institution.
Commercial paper rated at the time of purchase within the two highest classifications established by not
less than two standard rating services and that matures not more than 270 days after the date of
purchase.
Bonds, securities, other obligations and repurchase agreements of the United States, or an agency or
instrumentality of the United States.
Restricted cash consists of amounts required to be maintained separately in accordance with bond
covenants.
Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving)
equal value in exchange, include property taxes, grants, entitlements and donations. On an accrual basis,
revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from
grants, entitlements and donations is recognized in the fiscal year in which all eligibility requirements have
been satisfied.
The City maintains an investment pool for all City funds. Each fund’s portion of the investment pool is
displayed on the statement of net position/balance sheet as “equity in pooled cash.” The City’s cash and
cash equivalents are considered to be cash on hand, demand deposits and short-term investments with
original maturities of three months or less from the date of acquisition.
67
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Receivables
Inventories and Prepaids
Investments are stated at fair value. Short-term investments are reported at cost, which approximates fair
value. Securities traded on a national or international exchange are valued at the last reported sales price
at current exchange rates. Mortgages are valued on the basis of future principal and interest payments, and
are discounted at prevailing interest rates for similar instruments. Investments that do not have established
market values are reported at estimated fair value. Cash deposits are reported at carrying amounts, which
reasonably approximates fair value.
All receivables are reported at their gross value and, where appropriate, are reduced by the estimated
portion that is expected to be uncollectible.
Unrealized appreciation or depreciation on pension and other postemployment benefit trust fund
investments due to changes in fair value are recognized each year.
Certain receivables in governmental funds consist of rehabilitation and redevelopment loans that are
generally not expected or scheduled to be collected in the subsequent year.
Leases receivable consist of amounts collectible from local municipalities for which the City has irrevocably
pledged its full faith and credit as collateral for certain construction and improvement bonds. In accordance
with contractual agreements, these entities will provide all future amounts due for bond principal and
accrued interest payable. The receivable has been reported as current based on the amounts to be
collected next year to satisfy obligations.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government-wide and fund financial statements.
Transactions between funds that are representative of lending/borrowing arrangements outstanding at the
end of the fiscal year are referred to as either due to/from other funds (i.e., the current portion of
interfund loans) or advances to/from other funds (i.e., the non-current portion of interfund loans). All other
outstanding balances between funds are reported as due to/from other funds. Any residual balances
outstanding between the governmental activities and business-type activities are reported in the
government-wide financial statements as internal balances.
Amounts due from other governments include amounts due from grantors for specific programs and capital
projects. Program grants and capital grants for capital assets are recorded as receivables and revenues at
the time reimbursable project costs are incurred. Amounts received in advance of project costs being
incurred are reported as unearned revenue.
All inventories are valued at cost using the first-in/first-out method. Inventories of governmental funds are
recorded as expenditures when consumed.
68
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Capital Assets
Years
Buildings 20-50
Improvements 8-50
Equipment 3-15
Sanitary sewers 50
Infrastructure 10-75
Deferred Outflows of Resources
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items acquired or constructed since June 30, 1980), are reported in the applicable
governmental or business-type activities columns in the government-wide financial statements. Capital
assets are defined by the City as assets having a useful life in excess of three years and whose costs exceed
$5,000 ($100,000 for buildings). Capital assets are stated at historical cost or estimated historical cost
where actual cost information is not available. Donated capital assets are recorded at their estimated
acquisition cost as of the donation date.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend
asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects
are constructed. Interest incurred during the construction phase of capital assets of business-type activities,
if any, is included as part of the capitalized value of the asset constructed.
Capital assets are depreciated using the straight-line method over the following estimated useful lives:
In addition to assets, the statement of financial position will sometimes report 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 one or more future periods and so will not be
recognized as an outflow of resources (expense/expenditure) until then. The City reports deferred outflows
of resources for change in expected and actual investment returns, assumptions, and benefits provided in
its pension plans as well as for the deferred charge on refunding. A deferred refunding charge 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.
In addition to land and construction in progress, the amount presented as capital assets not being
depreciated includes intangible assets consisting of land development rights acquired for the purpose of
farmland and ranch preservation. Land development rights are deemed to have an indefinite useful life,
and therefore are not being amortized.
The City reviews long-lived assets for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset exceeds its fair value. If it is determined that an impairment loss has
occurred the asset is written down to its net realizable value and a current charge to income is recognized.
69
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Payables
Compensated Absences
Unearned Revenue
Long-term Obligations
Deferred Inflows of Resources
In addition to liabilities, the statement of financial position will sometimes report 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 one or more future periods and so will not be
recognized as an inflow of resources (revenue) until that time. The governmental funds report unavailable
revenues, which arise only under a modified accrual basis of accounting that are reported as deferred
inflows of resources. These amounts are deferred and recognized as an inflow of resources in the period
that the amounts become available. In addition, the City reports deferred inflows of resources for changes
in expected and actual investment returns, assumptions, and benefits provided in its pension plans.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well
as bond issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
It is the City’s policy to permit employees to accumulate earned but unused vacation and compensatory
time benefits, subject to certain limitations. Certain bargaining unit employees are also permitted to
accumulate earned but unused sick leave. All vacation and compensatory time pay and 50% of sick leave are
accrued when incurred in the government-wide and proprietary fund financial statements. A liability for
these amounts is reported in governmental funds only if they have matured, for example, as a result of
employee resignations or retirements.
In the government-wide financial statements, and proprietary fund types in the fund financial statements,
long-term debt and other long-term obligations are reported as liabilities in the applicable governmental
activities, business-type activities, or proprietary fund statement of net position. Bond premiums and
discounts are deferred and amortized over the life of the bonds using the straight-line basis. Bonds payable
are reported net of the applicable bond premium or discount. Bond issuance costs are reported as expenses
when incurred.
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end
of the fiscal year are referred to as either interfund receivables/payables (i.e., the current portion of
interfund loans) or advances to/from other funds (i.e., the non-current portion of interfund loans). All other
outstanding balances between funds are reported as due to/from other funds. Any residual balances
outstanding between the governmental and business-type activities are reported in the government-wide
financial statements as internal balances.
Unearned revenue consists of amounts received prior to the delivery of goods/service or expenditure on
allowable costs.
70
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Fund Balances
Interfund Transactions
Pensions
Use of Estimates
When the City incurs an expenditure for purposes for which various fund balance classifications can be used,
it is the City’s policy to use restricted fund balance first, then committed, assigned, and finally unassigned.
During the course of normal operations, the City has numerous transactions between funds, including
expenditures and transfers of resources to provide services, construct assets, and service debt. The
accompanying financial statements generally reflect such transactions as transfers. Operating subsidies are
also recorded as transfers. The amounts recorded as subsidies or advances are determined by the City.
Balances outstanding at year-end are reported as due to/from other funds. Transfers between governmental
or proprietary funds are netted as part of the reconciliation to the government-wide financial statements.
Internal service funds are used to record charges for services to all City departments and funds as transfers
or operating revenue. All City funds record these payments to the internal service funds as transfers or
operating expenditures/expenses.
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of
resources related to pensions, and pension expense, information about the fiduciary net position of the plan
and additions to/deductions from the plan fiduciary net position have been determined on the same basis as
they are reported by the plan. For this purpose, benefit payments (including refunds of employee
contributions) are recognized when due and payable in accordance with the benefit terms. Investments are
reported at fair value.
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
The City utilizes various investment instruments which are exposed to various risks, such as interest rate,
credit and overall market volatility. Due to the level of risk associated with certain investment securities, it
is reasonably possible that changes in the values of investment securities will occur in the near-term and
that such changes could materially affect the amounts reported in the financial statements.
Governmental funds report nonspendable fund balance for amounts that cannot be spent because they are
either (a) not in spendable form or (b) legally or contractually required to be maintained intact.Restricted
fund balance is reported when externally imposed constraints are placed on the use of resources by
grantors, contributors, or laws or regulations of other governments.Committed fund balance is reported
for amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of
the government’s highest level of decision-making authority, the City Council. A formal resolution of the
City Council is required to establish, modify, or rescind a fund balance commitment. The City reports
assigned fund balance for amounts that are constrained by the government’s intent to be used for specific
purposes, but are neither restricted nor committed. The City Council has not delegated the authority to
assign fund balance. Unassigned fund balance is the residual classification for the General Fund.
71
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
2. BUDGETARY INFORMATION
·
·
·
·
·
·
·
Total
Appropriations
Amount of
Expenditures
Budget
Variance
General fund:
General government:
Office of financial empowerment 60,000$ 63,835$ 3,835$
Public works 10,803,700 10,823,830 20,130
Debt service:
Principal 1,175,100 1,182,862 7,762
The City formally adopts operating budgets for the General Fund and all special revenue funds.
The City follows these procedures in establishing the budgetary data reflected in the financial statements:
Appropriations lapse at year-end for all annual budgets. Appropriations are automatically carried forward
for project-type budgets.
On or before the fourth Monday in March, the Mayor submits to the City Council a proposed operating
budget for the fiscal year commencing the following July 1.
Public hearings are conducted to obtain taxpayer comments.
Not later than the third Monday in May, the Council adopts a budget through passage of a resolution.
The appropriated budget is prepared by fund, department and the mandatory expenditure accounts as
established by the State of Michigan’s Uniform Chart of Accounts. Within the General Fund, the legal level
of budgetary control is the mandatory expenditure accounts (personal services, supplies and operating
expenses, capital outlay, debt service, transfers, and contingency) within each department. Within other
funds, the legal level of budgetary control is the mandatory expenditure accounts (personal services,
supplies and operating expenses, capital outlay, debt service, transfers, and contingency) within that fund.
Transfers between appropriations (mandatory accounts) require City Council approval. An exception to City
Council approval is allowed by City Charter for transfers between appropriations (mandatory accounts) for
amounts less than five thousand dollars, but not in excess of 15% of the appropriation in cases where five
thousand dollars exceeds 15% of the appropriation.
Copies of the City's separately issued budget report may be obtained from the Finance Department, 124 West
Michigan Avenue, Lansing, Michigan 48933.
Budgetary integration is employed as a management control device during the year for all budgeted funds.
Except for the General Fund, these budgets are adopted on a basis consistent with generally accepted
accounting principles ("GAAP"). In the General Fund, capital lease payments / installment payments are
budgeted, but capital lease acquisitions are not. There were no capital lease acquisitions during the year
ended June 30, 2016.
P.A. 621 of 1978, as amended, provides that a local unit shall not incur expenditures in excess of the amount
appropriated. During the year ended June 30, 2016, the City incurred expenditures in certain budgetary funds
which were in excess of the amounts appropriated, as follows:
72
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Total
Appropriations
Amount of
Expenditures
Budget
Variance
Nonmajor governmental funds:
Downtown Lansing, Inc.:
General government 760,200 760,399 199
State and federal grants fund:
Public works 15,451 891,680 876,229
Transfers out - 2,290 2,290
Tri-County Metro:
Public safety 837,500 840,095 2,595
3. DEFICIT FUND EQUITY
The Community Development Block Grant Program Special Revenue Fund reported a deficit unassigned fund
balance of $200,000. Total fund balance (which included $200,000 classified as committed related to a long-
term advance), was $0.
The above budgeted amounts are presented at the activity level, which is the required minimum level of
control per the Michigan Uniform Budget Manual.
The public works budget variance in the State and Federal Grants fund was caused by recording donated
infrastructure (constructed by the State of Michigan Department of Transportation) in the fund. This
transaction included both intergovernmental revenue and expenditures (and so had no effect on ending
fund balance), but was not reflected in the amended budget, as it was attributable to amounts recorded for
in-kind roadwork performed by the State, and therefore not subject to appropriation.
Governmental activities reported a deficit in unrestricted net position in the amount of $265,678,371 at
June 30, 2016. Total net position amounted to a deficit of $103,078,986, inclusive of $274,678,085 net
pension liability.
The Special Assessments Capital Projects Fund reported a deficit fund balance of $210,252. The fund
received a long-term advance from the general fund that was used to provide the working capital for the
fund in prior years. The deficit is the result of deferred special assessments receivable. As special
assessments are collected, this deficit will be eliminated, and the advance repaid.
The Cemetery, Golf, Garbage and Rubbish Collection, and Recycling Enterprise Funds reported deficits in
unrestricted fund net position of $754,476, $1,071,989, $2,630,456, and $2,974,795, respectively, as a
result of the net pension liability. Excluding the net pension liability, unrestricted net positions were
$425,588, $173,274, $235,788, and $1,698,607, respectively. Total fund net position amounted to deficits
of $579,163, $2,630,456, and $3,167,925 for the Cemetery, Garbage and Rubbish Collection, and Recycling
funds, respectively. Excluding the net pension liability, total net positions were $600,901 for the Cemetery
fund, $235,788 for the Garbage and Rubbish Collection fund, and $1,505,477 for the Recycling fund. Total
fund net position for the Golf fund was positive at $1,242,907, inclusive of the net pension liability and the
net investment in capital assets.
73
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
4. DEPOSITS AND INVESTMENTS
Primary
Government
Component
Units Totals
Statement of net position
Cash and investments 76,765,637$ 4,600,110$ 81,365,747$
Restricted cash and investments 3,568,818 1,201,198 4,770,016
Statement of fiduciary net position
Pension and OPEB trust funds:
Cash and cash equivalents 2,000 - 2,000
Investments 517,509,597 - 517,509,597
Agency funds:
Equity in pooled cash and investments 67,738 - 67,738
Total 597,913,790$ 5,801,308$ 603,715,098$
Deposits and investments
Bank deposits:
Checking/savings accounts 83,520,021$
Investment in securities and mutual funds:
Pooled investments 2,407,468
Pension and OPEB investments 517,509,597
Total investment in securities and mutual fund 519,917,065
Cash on hand 278,012
Total 603,715,098$
The City’s investment policy does not specifically address this risk, although the City believes that due to
the dollar amounts of cash deposits and the limits of FDIC insurance, it is impractical to insure all bank
deposits. As a result, the City evaluates each financial institution with which it deposits City funds and
assesses the level of risk of each institution; only those institutions with an acceptable estimated risk level
are used as depositories.
Custodial Credit Risk - Deposits.Custodial credit risk is the risk that in the event of a bank failure, the
City’s deposits may not be returned. State law does not require and the City does not have a policy for
deposit custodial credit risk. As of year-end, $82,988,204 of the City’s bank balance of $85,675,798 was
exposed to custodial credit risk because it was uninsured and uncollateralized.
The Tax Increment Finance Authority component unit reported a deficit in unrestricted net position of
$38,607,554 at June 30, 2016. The deficit is a result of full-accrual accounting for long-term debt, without
reflecting a corresponding receivable for tax captures to be received in future periods (which cannot be
accrued in accordance with generally accepted accounting principles).
Following is a reconciliation of deposit and investment balances for the primary government (including both
pooled cash and investments as well as pension and other postemployment benefit (OPEB) trust fund
balances) as of June 30, 2016:
74
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
S&P AAAm 158,524$
S&P A3 993,830
S&P A1 999,940
Unrated 255,174
Total 2,407,468$
Due within 1 year 1,993,770$
No maturity 413,698
Total 2,407,468$
Concentration of Credit Risk.Concentration of credit risk is the risk of loss attributed to the magnitude of
the City’s investment in a single issuer. State law limits allowable investments but does not limit
concentration of credit risk as identified in the list of authorized investments in the summary of significant
accounting policies. The City’s investment policy does not have specific limits in excess of state law on
concentration of credit risk. All investments held at year-end are reported above.
Pension and Other Postemployment Benefit Trust Funds
The deposits and investments of the City’s pension and other postemployment benefit trust funds are
maintained separately from the City’s pooled cash and investments, and are subject to separate investment
policies and State statutes. Accordingly, the required disclosures for the pension and OPEB deposits and
investments are presented separately.
For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the
City will not be able to recover the value of its investments or collateral securities that are in the
possession of an outside party. State law does not require and the City does not have a policy for
investment custodial credit risk. On the investments listed above, there is no custodial credit risk, as these
investments are uncategorized as to credit risk.
Interest Rate Risk.State law limits the allowable investments and the maturities of some of the allowable
investments as identified in the summary of significant accounting policies. The City’s investment policy
does not have specific limits in excess of state law on investment maturities as a means of managing its
exposure to fair value losses arising from increasing interest rates. Maturity dates for investments held at
year-end are summarized as follows:
Credit Risk.State law limits investments to specific government securities, certificates of deposit and
bank accounts with qualified financial institutions, commercial paper with specific maximum maturities and
ratings when purchased, bankers acceptances of specific financial institutions, qualified mutual funds and
qualified external investment pools as identified in the list of authorized investments in the summary of
significant accounting policies. The City’s investment policy does not have specific limits in excess of state
law on investment credit risk. Credit risk ratings, where applicable, are summarized as follows:
Custodial Credit Risk – Investments.As of June 30, 2016, the City's pooled investments consisted entirely of
mutual funds totaling $2,407,468.
75
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Employees' Police and Fire Employees' Retiree
Retirement Retirement Money Purchase Health Care
System System Pension Plan VEBA Totals
Investments at fair value, as
determined by quoted market price
U.S. treasuries:
Not on securities loan 6,332,795$ 9,323,600$ 14,571$ -$ 15,670,966$
On securities loan 611,789 658,640 - - 1,270,429
U.S. agencies:
Not on securities loan 16,325,853 20,458,957 - - 36,784,810
On securities loan 212,787 7,213 - - 220,000
Domestic corporate securities:
Not on securities loan 24,207,773 31,794,917 - - 56,002,690
Domestic equities:
Not on securities loan 16,946,493 44,841,387 - - 61,787,880
On securities loan 18,323,498 22,206,197 - - 40,529,695
International equities:
Not on securities loan 769,376 1,448,649 - - 2,218,025
Emerging markets equities 6,709,430 10,394,439 - 585,795 17,689,664
Collateralized mortgage
obligations 358,046 416,223 - - 774,269
Real estate investment
funds 19,178,655 21,434,902 - - 40,613,557
Equity mutual funds - 28,143,587 - - 28,143,587
International equity
mutual funds 44,163,946 42,615,767 99,233 2,236,046 89,114,992
Domestic equity
mutual funds 16,598,398 37,920,820 1,314,170 8,794,625 64,628,013
Domestic debt securities
mutual funds - - 596,867 9,631,551 10,228,418
International debt securities
mutual funds - 27,479,643 - - 27,479,643
Private equity partnerships 17,253,511 - - - 17,253,511
Money market funds 2,928,230 2,595,437 - 1,575,781 7,099,448
Total investments $ 190,920,580 $ 301,740,378 $ 2,024,841 $ 22,823,798 $ 517,509,597
The pension and OPEB trust funds do not maintain any checking or other demand/time deposit accounts.
Amounts reported as cash and cash equivalents in the statement of plan net position are composed entirely
of short-term investments in money market accounts.
Investments
The Michigan Public Employees Retirement Systems’ Investment Act, Public Act 314 of 1965, as amended,
authorizes the pension trust funds to invest in stocks, government and corporate securities, mortgages, real
estate, and various other investment instruments, subject to certain limitations. The retirement boards
have the responsibility and authority to oversee the investment portfolio. Various professional investment
managers are contracted to assist in managing the pension trust funds’ assets. All investment decisions are
subject to Michigan law and the investment policy established by the retirement boards.
The investments of each pension trust fund are held in a bank administered trust fund. Following is a
summary of pension and other postemployment benefits investments as of June 30, 2016:
Deposits
76
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Employees' Police and Fire Employees' Retiree
Retirement Retirement Money Purchase Health Care
System System Pension Plan VEBA Totals
AAA -$ -$ 113,173$ -$ 113,173$
AA 1,629,887 1,326,733 156,723 - 3,113,343
BBB 19,235,750 27,479,643 - 9,631,551 56,346,944
BB - - 50,419 - 50,419
US government
guaranteed 22,000,486 29,292,864 - - 51,293,350
Not rated 28,214,355 35,177,554 - - 63,391,909
Assets not subject
to credit risk 119,840,102 208,463,584 1,704,526 13,192,247 343,200,459
$ 190,920,580 $ 301,740,378 $ 2,024,841 $ 22,823,798 $ 517,509,597
Employees' Police and Fire
Retirement Retirement
System System
Common stock 8.7%12.6%
Corporate bonds 12.7%10.5%
International equity mutual funds 10.1%9.1%
Domestic equity mutual funds 9.0%9.3%
International equity mutual funds 6.5%0.0%
International equity mutual funds 6.5%0.0%
International equity mutual funds 0.0%7.1%
International equity mutual funds 0.0%7.0%
Northern Trust Bank, N.A.
Legg Mason Fund Advisor, Inc.
Franklin Templeton
Private Advisors
SEI Trust Company
Lazard Asset Management
Mondrian
Artisan
Investment Type Issuer
Concentration of Credit Risk.At June 30, 2016, the pension and other postemployment benefits investment
portfolio was concentrated as follows:
Custodial Credit Risk.For investments, custodial credit risk is the risk that, in the event of the failure of
the counterparty, the City will not be able to recover the value of its investments or collateral securities
that are in the possession of an outside party. The City’s pension investment policies require that
investment securities be held in trust by a third-party institution in the name of the pension trust fund. As
such, although uninsured and unregistered, the City’s pension investments are not exposed to custodial
credit risk since the securities are held by the counterparty’s trust department in the name of the pension
trust fund. Short-term investments in money market funds and open-end mutual funds are not exposed to
custodial credit risk because their existence is not evidenced by securities that exist in physical or book
form.
Credit Risk.The City’s pension investment policies provide that at least 90% of its investments in fixed
income securities be rated BBB- or better by a nationally recognized statistical rating organization and the
remaining 10% be rated at least B- or better. The City’s pension and other postemployment benefits
investments were rated by Standard & Poor’s as follows:
The City’s pension and other postemployment benefits investment policies require diversification of fixed
income securities; however, they do not specify percentages of dollar amounts by industry or issuer.
77
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Employees' Police and Fire Employees' Retiree
Retirement Retirement Money Purchase Health Care
System System Pension Plan VEBA Totals
International equities:
Canada 337,948$ 590,880$ -$ -$ 928,828$
India 96,363 150,363 - - 246,726
The Netherlands 95,180 216,360 - - 311,540
United Kingdom 187,216 371,373 - - 558,589
France 52,669 119,673 - - 172,342
International equity
mutual funds 44,163,946 70,095,410 99,233 2,236,046 116,594,635
Total 44,933,322$ 71,544,059$ 99,233$ 2,236,046$ 118,812,660$
Less than More than
1 year 1-5 years 6-10 years 10 years Total
Employees' Retirement
System
U.S. agencies 1,629,887$ 689,617$ -$ -$ 2,319,504$
U.S. government bonds 2,570,027 1,384,531 2,666,283 323,743 6,944,584
U.S. government mortgage
backed securities 2,321 657,817 1,790,460 9,641,556 12,092,154
U.S. government issued
commercial mortgage
backed securities - 200,985 810,862 485,987 1,497,834
Commercial mortgage
backed securities - - 87,494 270,552 358,046
Total 4,202,235$ 2,932,950$ 5,355,099$ 10,721,838$ 23,212,122$
Investment
Foreign Currency Risk.Foreign currency risk is the risk that changes in exchange rates will adversely affect
the fair value of an investment or deposit. The pension and other postemployment benefits trusts’ exposure
to foreign currency risk is as follows:
Investment Maturities (Fair Value)
(currency in U.S. dollar)
Interest Rate Risk.Interest rate risk is the risk that changes in interest rates will adversely affect the fair
market value of an investment. The City’s pension investment policies provide that the average duration of
fixed income securities shall not deviate from the Lehman Brothers Aggregate Index duration by +/-20%. As
of June 30, 2016, maturities of the City’s pension and other postemployment benefits trust debt securities
and collateralized mortgage obligations were as follows:
78
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Less than More than
1 year 1-5 years 6-10 years 10 years Total
Police and Fire Retirement
System
U.S. agencies 1,326,733$ 953,940$ -$ -$ 2,280,673$
U.S. government bonds 4,025,502 1,637,270 3,939,422 380,046 9,982,240
U.S. government mortgage
backed securities 2,989 993,891 1,558,786 13,279,939 15,835,605
U.S. government issued
commercial mortgage
backed securities - 299,690 901,819 655,342 1,856,851
Commercial mortgage
backed securities - - 112,492 303,731 416,223
Total 5,355,224$ 3,884,791$ 6,512,519$ 14,619,058$ 30,371,592$
Investment Maturities (Fair Value)
Fair Value Measurement
Securities Lending.Under contracts approved by the City, the pension and other postemployment benefits
trust funds are permitted to lend their securities to broker-dealers and banks (borrowers) for collateral that
will be returned for the same securities in the future. The pension trust and other postemployment benefits
funds’ custodial banks manage the securities lending programs and receive cash as collateral. Collateral
cash is initially pledged at 100% of the fair value of the securities lent, and may not fall below 95% of the
market value of the loaned security during the term of the loan. At all times, collateral cannot be more
than $100,000 less than the market value of the loaned security. There are no restrictions on the amount of
securities that can be loaned.
Securities on loan at year-end are classified in the preceding schedule of custodial credit risk according to
the category for the collateral received on the securities lent. At year-end, the pension trust funds have no
credit risk exposure to borrowers because the collateral held by the custodians exceeds the market value of
the related securities lent. At June 30, 2016, the fair value of securities on loan by the Employees’
Retirement System and the Police and Fire Retirement System were $19,148,074 and $22,872,049,
respectively, for which the Plans’ received cash collateral of $19,444,659 and $23,219,203, respectively.
The contract with the pension and other postemployment benefits trust fund custodians require them to
indemnify the City if the borrowers fail to return the securities (and if the collateral is inadequate to
replace the securities lent) or fail to pay the City for income distributions by the securities’ issuers while
the securities are on loan.
The City categorizes its fair value measurements within the fair value hierarchy established by generally
accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair
value of the asset, as determined by the City's investment advisors. Level 1 inputs are quoted prices in
active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are
significant unobservable inputs.
79
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Level 1 Level 2 Level 3 Total
U.S. agencies -$ 37,004,810$ -$ 37,004,810$
U.S. government bonds - 16,941,395 - 16,941,395
Collateralized mortgage
obligations 774,269 - - 774,269
Mutual funds 254,097,059 36,355,433 - 290,452,492
Domestic equities 102,317,575 - - 102,317,575
International equities 2,218,025 - - 2,218,025
Emerging equities 17,689,664 - - 17,689,664
Commercial paper 1,993,770 - - 1,993,770
Money market funds 7,354,622 158,524 - 7,513,146
386,444,984$ 90,460,162$ -$ 476,905,146
Investments carried at net asset value:
Equity funds 25,758,408
Private equity partnerships 17,253,511
Total investments 519,917,065$
5. RECEIVABLES
Governmental Business-type Component
Activities Activities Units
Accounts receivable 10,943,563$ 6,218,353$ 831,399$
Taxes receivable 888,017 - -
Special assessments receivable 393,563 - -
Loans receivable 1,428,378 63,848 279,495
Accrued interest receivable 2,293,588 132,087 -
Due from other governments 8,683,766 - 119,292
Lease receivable - 22,494,661 -
Allowance for uncollectible accounts (728,535) (319,519) (983)
23,902,340$ 28,589,430$ 1,229,203$
Amount not expected to be
collected within one year 3,858,185$ 21,863,577$ 279,495$
Net Asset Value Investments.Certain investments noted above are carried at net asset value as these are
not actively traded. The fair value is estimated based on the dollar value per share as of June 30, 2016.
These investments are able to be liquidated as needed, to the extent there is a willing buyer in the market.
There are not any restrictions related to the sale of these investments. At June 30, 2016, the City had
$1,382,103 outstanding on initial commitments of $8,600,000 with the Invesco Mortgage Recovery Fund (the
"Fund"). The Fund has a seven year life, and the intent is to sell all of the investments prior to the Fund's
maturity. The other investments at net asset value do not contain required redemption periods.
Receivables are comprised of the following:
The City has the following recurring fair value measurements as of June 30, 2016:
80
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
79,554$
250,000
115,157
82,111
409,096
400,000
1,335,918$
Brownfield Revolving Loan Fund loan to the High Grade Material Company for demolition and
cleanup related to a single parcel of property in the City. Interest is accreted at 5.0% per
annum.
Brownfield Cleanup Revolving Loan Fund loan to the City of Lansing Economic Development
Corporation related to property formerly owned by the City of Lansing Board of Water and
Light. Interest is stated at 0%.
Brownfield Revolving Loan Fund loan receivable to the City for cleanup related to a single
parcel to be converted into a City parking lot. Interest is stated at 0%.
The Brownfield Redevelopment Authority component is also party to loan agreements in which the associated
loans are expected to be repaid by future collections of tax increment revenues related to the properties being
cleaned up. The liability of the local corporations is limited to any shortfalls in future collection of tax
increment revenues. Because these balances are not expected to be collected from outside parties, no balance
is reported in the Brownfield Redevelopment Authority statements. The outstanding balance of such loans at
June 30, 2016 consisted of the following:
Brownfield Revolving Loan Fund loan to Michigan Avenue Investors, LLC for cleanup related to
a former gas station. Interest is accreted at 2.0% per annum.
Brownfield Revolving Loan Fund loan to Brownfield Development Specialists, LLC for cleanup
related to the "Dard Building" in the City. Interest is stated at 0%.
Brownfield Revolving Loan Fund loan to Y Site, LLC for cleanup related to the former YMCA
building. Interest is accreted at 3.0% per annum.
81
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
6. CAPITAL ASSETS
Beginning Ending
Balance Additions Disposals Transfers Balance
Governmental activities
Capital assets, not being depreciated:
Land 25,838,193$ -$ -$ -$ 25,838,193$
Construction in progress 14,367,233 346,563 - (14,048,677) 665,119
40,205,426 346,563 - (14,048,677) 26,503,312
Capital assets, being depreciated:
Land improvements 19,945,351 - - - 19,945,351
Equipment and vehicles 36,065,775 1,653,432 (506,158) 383,818 37,596,867
Buildings 123,353,011 - (742,083) 13,664,859 136,275,787
Infrastructure 303,307,990 3,221,626 (4,533,169) - 301,996,447
482,672,127 4,875,058 (5,781,410) 14,048,677 495,814,452
Less accumulated depreciation for:
Land improvements (8,871,274) (789,020) - - (9,660,294)
Equipment and vehicles (29,065,498) (2,260,833) 506,158 - (30,820,173)
Buildings (74,027,809) (4,057,877) 698,415 - (77,387,271)
Infrastructure (210,324,701) (4,388,960) 4,450,920 - (210,262,741)
(322,289,282) (11,496,690) 5,655,493 - (328,130,479)
Total capital assets
being depreciated, net 160,382,845 (6,621,632) (125,917) 14,048,677 167,683,973
Governmental activities
capital assets, net 200,588,271$ (6,275,069)$ (125,917)$ -$ 194,187,285$
At June 30, 2016, the City’s governmental activities had outstanding commitments through construction
contracts of approximately $2,150,000.
Capital asset activity for the year ended June 30, 2016 was as follows:
82
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Beginning Ending
Balance Additions Disposals Transfers Balance
Business-type activities
Capital assets, not being depreciated:
Land 13,483,910$ -$ -$ -$ 13,483,910$
Construction in progress 12,354,899 1,098,618 - (1,466,372) 11,987,145
25,838,809 1,098,618 - (1,466,372) 25,471,055
Capital assets, being depreciated:
Land improvements 24,585,130 - (94,248) 845,344 25,336,226
Equipment and vehicles 7,144,619 - (20,552) - 7,124,067
Buildings 216,145,477 181,417 - 621,028 216,947,922
Sewers 335,569,192 549,327 - - 336,118,519
583,444,418 730,744 (114,800) 1,466,372 585,526,734
Less accumulated depreciation for:
Land improvements (13,127,848) (741,446) 94,248 - (13,775,046)
Equipment and vehicles (5,354,119) (405,590) 20,552 - (5,739,157)
Buildings (119,833,130) (4,868,490) - - (124,701,620)
Sewers (88,386,208) (6,859,795) - - (95,246,003)
(226,701,305) (12,875,321) 114,800 - (239,461,826)
Total capital assets
being depreciated, net 356,743,113 (12,144,577) - 1,466,372 346,064,908
Business-type activities
capital assets, net 382,581,922$ (11,045,959)$ -$ -$ 371,535,963$
Depreciation of governmental activities by function
General government 455,334$
Public safety 505,720
Public works 4,388,961
Recreation and culture 2,290,536
Community development 1,812,352
Internal service funds 2,043,787
Total depreciation expense - governmental activities 11,496,690$
Depreciation of business-type activities by function
Sewage disposal system 10,288,817$
Municipal parking system 2,206,999
Cemetery 12,408
Golf 66,085
Recycling 301,012
Total depreciation expense - business-type activities 12,875,321$
At June 30, 2016, the City’s business-type activities had outstanding commitments through construction
contracts of approximately $2,730,000.
Depreciation expense was charged to functions/programs of the primary government as follows:
83
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Governmental Business-type Component
Activities Activities Units
Accounts payable 8,383,224$ 896,183$ 1,957,711$
Deposits payable 17,662 58,375 -
Accrued payroll 2,825,943 127,540 133,886
Contract retainage payable 255,174 - -
Due to other governments 2,994,637 - -
Other 1,341,612 - -
$ 15,818,252 $ 1,082,098 $ 2,091,597
8. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS
Due from
Other Funds
Due to Other
Funds
General fund -$ 2,497$
Nonmajor governmental funds 1,404,970 1,520,320
Sewage disposal system 2,695,492 2,591,138
Municipal parking system 15,790 -
Nonmajor enterprise funds - 2,297
Total 4,116,252$ 4,116,252$
Advances to Advances from
Other Funds Other Funds
Nonmajor governmental funds -$ 241,309$
Municipal parking system 241,309 -
Total $ 241,309 $ 241,309
Accounts payable and accrued liabilities are comprised of the following:
The composition of interfund balances as of June 30, 2016, was as follows:
The above balances generally resulted from a time lag between the dates that interfund goods and services
are provided or reimbursable expenditures occur, transactions are recorded in the accounting system, and
payments between funds are made.
Due to and from primary government funds
Advances to and from primary government funds
84
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Due from
primary
government
Due to
component
unit
Nonmajor governmental funds -$ 2,119,598$
Brownfield Redevelopment Authority 1,150,064 -
Tax Increment Finance Authority 969,534 -
Total 2,119,598$ 2,119,598$
Nonmajor Nonmajor Internal
governmental enterprise service
General fund funds funds funds Total
General fund -$ 5,395,290$ -$ 1,000,000$ 6,395,290$
Nonmajor governmental funds 87,290 2,621,269 951,497 - 3,660,056
Sewage disposal system 300,000 - - - 300,000
Nonmajor enterprise funds - 21,782 - - 21,782
Internal service funds - 782,225 - - 782,225
Total 387,290$ 8,820,566$ 951,497$ 1,000,000$ 11,159,353$
Transfers In
Transfers are used to: (1) move revenues from the fund that is required to collect them to the fund that is
required or allowed to expend them; (2) move receipts restricted to or allowed for debt service from the
funds collecting the receipts to the debt service fund as debt service payments become due; and (3) use
unrestricted revenues collected in the General Fund to finance various programs accounted for in other
funds in accordance with budgetary authorizations.
Due to and from component units
For the year ended June 30, 2016, interfund transfers consisted of the following:
Transfers Out
85
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
9. LONG-TERM DEBT
Interest Original
Rate Amount Amount
General obligation bonds
Governmental activities:
2007 Michigan Transportation Fund Limited Tax Bonds 3.625-5.00% 1,137,600$ 138,000$
2007 Michigan Transportation Fund Limited Tax Bonds 3.625-5.00%3,602,400 437,000
2007 Fire Station Refunding Bonds 3.625-5.00%1,780,000 595,000
2008 Michigan Transportation Fund Limited Tax Bonds 3.00-4.00%3,500,000 995,000
2009 Capital Improvement Bonds - Limited Tax General 3.15-6.85%10,197,000 8,825,000
2010 Refunding Bonds - Limited Tax General Obligation 2.60-2.65%2,470,000 920,000
2013 Refunding Bonds - Limited Tax General Obligation
Energy Efficiency Refunding Bonds 2.40%5,645,000 4,435,000
2013 Refunding Bonds - Limited Tax General Obligation
Phone System Refunding Bonds 2.40%240,000 60,000
2010 Recovery Zone Economic Development Bonds
2014 Capital Improvement Bonds - Limited Tax General
Obligation 1.25-2.00%2,275,000 770,000
2010 Recovery Zone Economic Development Bonds 3.40-7.25%3,200,000 2,635,000
2015 Building Authority Refunding 2.00%320,000 320,000
2015 Lansing Center Refunding 2.00-3.00%1,770,000 1,770,000
36,137,000$ 21,900,000$
Business-type activities:
2009 Building Authority Refunding Bonds 6.014-6.584% 8,161,691$ 8,161,691$
2012 Building Authority Refunding Bonds 0.55-3.70%7,200,000 6,005,000
2007 Building Authority Refunding Bonds 3.625-5.00%7,965,000 7,325,000
2013 Building Authority Golf Course Refunding Bonds 2.40%405,000 105,000
2014 Building Authority Refunding Bonds 4.75%7,965,000 7,245,000
1996 Limited Tax Sewer Bond - 5005-07 2.25%3,365,073 200,073
1996 Limited Tax Sewer Bond - 5005-08 2.25%3,995,000 485,000
1997 Limited Tax Sewer Bond - 5005-09 2.25%4,746,780 836,780
1998 Limited Tax Sewer Bond - 5005-10 2.25%10,539,950 2,454,950
1999 Limited Tax Sewer Bond - 5005-11 2.50%10,120,000 2,450,000
2000 Limited Tax Sewer Bond - 5005-12 2.50%9,447,830 2,777,830
2001 Limited Tax Sewer Bond - 5005-13 2.50%10,573,046 3,703,046
2002 Limited Tax Sewer Bond - 5005-14 2.50%12,381,131 5,586,131
2003 Limited Tax Sewer Bond - 5005-15 2.50%10,259,826 5,165,688
2004 Limited Tax Sewer Bond - 5005-16 2.13%3,070,277 2,082,649
2005 Limited Tax Sewer Bond - 5005-17 2.13%8,003,778 4,293,778
2005 Limited Tax Sewer Bond - 5005-18 1.63%13,389,371 7,469,371
2006 Limited Tax Sewer Bond - 5005-19 1.63%18,216,346 11,411,346
General obligation bonds.The government issues general obligation bonds to provide funds for the
acquisition and construction of major capital facilities. General obligation bonds are direct obligations and
pledge the full faith and credit of the government. These bonds are issued as 10 to 30-year serial bonds
with varying amounts of principal maturing each year. General obligation bonds currently outstanding are as
follows:
86
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Interest Original
Rate Amount Amount
Business-type activities (concluded):
2007 Limited Tax Sewer Bond - 5005-20 1.63%24,244,726$ 16,144,726$
2008 Limited Tax Sewer Bond - 5005-21 2.50%27,494,933 20,525,453
2008 Limited Tax Sewer Bond - 5005-22 2.50%15,615,000 12,025,604
2009 Capital Improvement Bonds 4.10-7.05%9,803,000 9,165,000
2010 Limited Tax Sewer Bond - 5411-01 2.50%8,548,000 7,478,000
2015 Limited Tax Sewer Bond - 5211-01 2.50%2,914,584 2,784,584
2015 Limited Tax Sewer Bond - 5211-02 2.40%1,977,487 1,887,487
2015 Building Authority Refunding 2.00-3.00%6,765,000 6,765,000
247,167,829$ 154,534,187$
Advance Refunding.In December 2015, the City issued $7,085,000 of General Obligation Limited Tax
Refunding Bonds to partially advance refund the City’s 2005 Building Authority Refunding Bonds of $325,000
and $6,980,000 reported in its governmental activities and business-type activities, respectively. The
proceeds of the bonds were used to purchase U.S. government securities that were placed in an escrow
fund for the purpose of generating resources for all future debt service payments on the refunded debt. As
a result, the bonds are considered defeased and the liability has been removed from the statement of net
position. The bonds are to be called on June 1, 2017 through 2022. Accordingly, $7,305,000 of defeased
debt remains outstanding at year-end. The refunding resulted in a cash savings of $808,750 and an
economic gain of $763,178.
As of June 30, 2016, the Tax Increment Financing Authority component unit had defeased bonds outstanding
consisting of $8,420,000 related to the 1990 Tax Increment Finance Authority Bonds. This amount is
scheduled to be paid by the escrow agent in installments on May 1 of years 2017 through 2020.
In December 2015, the City issued $1,770,000 of General Obligation Limited Tax Refunding Bonds to
partially advance refund the City’s 2006 Lansing Center Limited Tax Bonds of $1,820,000. The proceeds of
the bonds were used to purchase U.S. government securities that were placed in an escrow fund for the
purpose of generating resources for all future debt service payments on the refunded debt. As a result, the
bonds are considered defeased and the liability has been removed from the statement of net position. The
bonds are to be called on June 1, 2017 through 2022. Accordingly, $1,820,000 of defeased debt remains
outstanding at year-end. The refunding resulted in a cash savings of $166,645 and an economic gain of
$157,462.
On April 11, 2016, the City issued $3,335,000 of Limited Tax General Obligation bonds under the wet
weather control program. Payments of amounts drawn are to be made semi-annually over a 20-year period,
beginning on October 1, 2018. Interest is charged on the outstanding balance at 2.50%. As of June 30, 2016,
no amounts had been drawn on this loan.
87
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Interest Original
Rate Amount Amount
Revenue bonds - business type activities
2013 Sewer Revenue and Refunding Bond 2.40%
21,765,000$ 18,725,000$
Interest Original
Rate Amount Amount
Installment purchase agreements
Governmental activities:
2013 Lease Purchase Agreement - Garage 2.40%1,892,332$ 782,442$
2014 Lease Purchase Agreement - Recycling Trucks 1.96%1,550,855 1,112,625
2015 Ballpark Improvements Installment Purchase 3.00%13,500,000 13,124,986
2014 Installment Purchase Agreement - Police Cars 1.44%491,241 248,264
$ 17,434,428 $ 15,268,317
Business-type activities:
2014 Lease Purchase Agreement - Recycling Carts 1.96%
1,737,000$ 1,246,673$
Interest Original
Rate Amount Amount
Loans payable
Governmental activities:
HUD Section 108 Loan 1.52%5,900,000$ 5,900,000$
2014 SIB Loan 3.00%1,972,600 1,972,600
$ 7,872,600 $ 7,872,600
Loans payable.The government has entered into loan agreements with the certain State agencies for
program purposes. Loans payable at year-end are as follows:
Revenue bonds.TheCityalsoissuesbondswheretheincomederivedfromtheacquiredorconstructed
assets is pledged to pay debt service. Revenue bonds outstanding at year-end are as follows:
Installment purchase agreements.The government enters into installment purchase agreements for
equipment and related capital assets. Installment purchase agreements outstanding at year-end are as
follows:
Pledged revenues.The City has pledged future sewer customer revenues, net of specified operating
expenses, to repay $21,765,000 in sewer revenue and refunding bonds issued in 2013. Proceeds from the
bonds provided financing for the construction for various sewer infrastructure projects. The bonds are
payable solely from sewer customer net revenues and are payable through 2028. Annual principal and
interest payments on the bonds are expected to require less than 14% of net revenues. The total principal
and interest paid for the current year and total customer net revenues were $2,411,188 and $17,841,901
respectively.
88
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental activities
General obligation bonds 25,755,000$ 2,090,000$ 5,945,000$ 21,900,000$ 3,835,000$
Installment purchase
agreements 16,387,327 - 1,119,010 15,268,317 1,510,786
Loans payable 7,872,600 - - 7,872,600 -
Total installment debt 50,014,927 2,090,000 7,064,010 45,040,917 5,345,786
Deferred amounts:
For issuance discounts (79,821) - (6,833) (72,988) -
For issuance premiums 115,102 80,175 53,959 141,318 -
Compensated absences 9,568,555 9,552,788 9,568,555 9,552,788 885,338
Accrued workers
compensation 3,418,805 184,364 1,305,255 2,297,914 494,462
Accrued tax settlement 52,161 - 52,161 - -
$ 63,089,729 $ 11,907,327 $ 18,037,107 $ 56,959,949 $ 6,725,586
Business-type activities
General obligation bonds 165,352,984$ 8,742,487$ 19,561,284$ 154,534,187$ 12,280,073$
Revenue bonds 20,275,000 - 1,550,000 18,725,000 1,550,000
Installment purchase
agreements 1,459,431 - 212,758 1,246,673 216,950
Total installment debt 187,087,415 8,742,487 21,324,042 174,505,860 14,047,023
Deferred amounts:
For issuance discounts (709,367) - (73,011) (636,356) -
For issuance premiums 2,314,325 254,156 216,614 2,351,867 -
Compensated absences 718,149 759,258 718,149 759,258 114,663
189,410,522$ 9,755,901$ 22,185,794$ 176,980,629$ 14,161,686$
For the governmental activities, compensated absences and other long-term debt are generally liquidated
by the General Fund.
Changes in long-term debt. Long-term liability activity for the year ended June 30, 2016, was as follows:
89
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Principal Interest Total Principal Interest Total
5,345,786$ 1,503,403$ 6,849,189$ 14,047,023$ 7,534,838$ 21,581,861$
4,425,796 1,340,744 5,766,540 14,016,223 7,160,579 21,176,802
3,539,718 1,210,063 4,749,781 14,007,360 6,814,301 20,821,661
3,240,169 1,102,649 4,342,818 14,004,973 6,424,295 20,429,268
3,756,647 1,001,025 4,757,672 15,065,326 6,035,709 21,101,035
13,474,579 3,460,283 16,934,862 60,418,384 23,074,663 83,493,047
10,188,221 1,090,497 11,278,718 31,005,896 10,116,419 41,122,315
1,070,001 38,749 1,108,750 8,905,675 6,462,599 15,368,274
- - - 3,035,000 3,474,257 6,509,257
45,040,917$ 10,747,413$ 55,788,330$ 174,505,860$ 77,097,660$ 251,603,520$
10. FUND BALANCES - GOVERNMENTAL FUNDS
Nonmajor
General Governmental
Fund Funds Totals
Nonspendable
Inventories 29,770$ 809,977$ 839,747$
Prepaids 462,779 - 462,779
Corpus of permanent fund - 1,768,354 1,768,354
492,549 2,578,331 3,070,880
Restricted
Major and local streets - 4,730,816 4,730,816
Drug law and narcotics
enforcement - 1,466,679 1,466,679
Building permit activity - 286,633 286,633
Capital improvements (unexpended
bond proceeds)- 449,273 449,273
- 6,934,665 6,934,665
2022-2026
2020
Governmental Activities Business-type Activities
In accordance with GASB Statement No. 54,Fund Balance Reporting and Governmental Fund Type
Definitions,the City classifies fund balances based primarily on the extent to which it is bound to observe
constraints imposed upon the use of the resources reported in governmental funds. Detailed information on
fund balances of governmental funds is as follows:
2019
2032-2036
Debt service requirements to maturity for all installment debt of the City are as follows:
Year
Ending
2021
2027-2031
June 30
2018
2017
2037-2040
90
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Nonmajor
General Governmental
Fund Funds Totals
Committed
Police and fire services 328,111$ -$ 328,111$
By ordinance (budget carryforwards) - 3,011,081 3,011,081
Stadium events 99,995 - 99,995
Community development - 200,000 200,000
Shopping district events and maintenance - 17,712 17,712
City parks - 469,114 469,114
Capital improvements - 4,729,346 4,729,346
428,106 8,427,253 8,855,359
Unassigned (deficit)12,407,748 (410,252) 11,997,496
Total fund balances -
governmental funds 13,328,403$ 17,529,997$ 30,858,400$
11. NET INVESTMENT IN CAPITAL ASSETS
Governmental Business-type Component
Activities Activities Units
Capital assets:
Capital assets not being depreciated 26,503,312$ 25,471,055$ -$
Capital assets being depreciated, net 167,683,973 346,064,908 4,471
Total capital assets 194,187,285 371,535,963 4,471
Related debt:
General obligation bonds 21,900,000 154,534,187 -
Revenue bonds - 18,725,000 -
Installment purchase agreements 15,268,317 1,246,673 -
Loans payable 7,872,600 - -
Unamortized bond discounts (72,988) (636,356) -
Unamortized bond premiums 141,318 2,351,867 -
Deferred loss on bond refunding (149,549) (2,627,629) -
Amounts under leases receivable - (22,494,661) -
Unexpended bond proceeds (449,273) - -
Total related debt 44,510,425 151,099,081 -
Net investment in capital assets 149,676,860$ 220,436,882$ 4,471$
12. SEGMENT INFORMATION - ENTERPRISE FUNDS
The composition of net investment in capital assets as of June 30, 2016, was as follows:
The government issued revenue bonds to finance certain improvements to its sewage disposal system.
Because the Sewage Disposal System, an individual fund that accounts entirely for the government’s sewage
activities, is a segment and is reported as a major fund in the fund financial statements, separate segment
disclosures herein are not required.
91
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
13. RISK MANAGEMENT
2016 2015
Estimated liability, beginning of year 704,905$ 831,808$
Estimated claims incurred,
including changes in estimates 9,812,124 10,048,116
Claim payments (9,860,965) (10,175,019)
Estimated liability, end of year 656,064$ 704,905$
2016 2015
Estimated liability, beginning of year 3,418,805$ 5,967,593$
Estimated claims incurred,
including changes in estimates 184,364 1,328,263
Claim payments (1,305,255) (3,877,051)
Estimated liability, end of year 2,297,914$ 3,418,805$
The City of Lansing, Michigan is exposed to various risks of loss related to property loss, torts, errors and
omissions and employee injuries.
Fiscal Year Ended June 30,
Fiscal Year Ended June 30,
The City is self-funded for Blue Cross Blue Shield healthcare coverage for employees and retirees. The City
maintains stop/loss coverage that limits its per-case exposure to $250,000. The City estimates healthcare
claims that are incurred but not reported as of year-end, which is accounted for in the City's Fringe Benefits
Internal Service Fund. Changes in the estimated liability were as follows:
The City is self-insured for workers’ compensation costs. The City estimates the liability for workers’
compensation claims that have been incurred through the end of the fiscal year, including those claims that
have been reported as well as those that have not yet been reported to the City. The current liability is
accounted for in the General Fund, with long-term liabilities accounted for in the Statement of Net
Position. The City has liability insurance coverage up to a maximum amount of $16,000,000 per occurrence
with a $350,000 deductible. Changes in the estimated long-term liability as well as the total estimated cost
of claims for the past two fiscal years were as follows:
The City carries commercial insurance for claims relating to general liability, property, electronic data
processing, boiler and machinery, police professional and errors and omissions. The City has not
experienced settlements in excess of insurance coverage during the past three years. The City is uninsured
for acts of nature and environmental clean-up costs.
92
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
14. PROPERTY TAXES
15. CONTINGENT LIABILITIES
16. PENSION PLANS
Employees' Retirement System
Risk Management.The government is a defendant in various lawsuits. Although the outcome of these
lawsuits is not presently determinable, it is the opinion of the government’s counsel that resolution of these
matters will not have a material adverse effect on the financial condition of the government.
Property taxes attach as an enforceable lien on property as of the date they are levied. City, community
college, and 50% of school taxes are levied and due July 1 and become delinquent after August 31. County
taxes and the balance of school taxes are levied and due December 1 and become delinquent after February
14. In March, taxes on real property still delinquent are purchased by the County's tax revolving funds.
Collections of community college, school, and county taxes and remittances are accounted for in the
general fund. City property tax revenues are recognized in the fiscal year for which the taxes are levied to
the extent that they result in current receivables (i.e., are collected within 60 days after fiscal year-end).
The City is permitted by charter and state law to levy taxes up to $20.00 per $1,000 of assessed valuation
for general operations other than the payment of principal and interest on long-term debt. The tax rate to
finance general governmental services other than the payment of principal and interest on long-term debt
for the year ended June 30, 2016 was $19.44 per $1,000 of taxable value.
Plan Description.The City sponsors and administers the Employees’ Retirement System (the “Plan”), a
single-employer, defined benefit pension plan that covers general full-time employees of the City of
Lansing, Michigan and employees of the 54-A District Court. It does not include elected officials, who are
members of the Employees’ Money Purchase Pension Plan, nor does it include police officers and
firefighters, who are members of a separate City defined benefit pension plan. The Plan was established
and may be amended by the City Council and is administered by a nine member Board of Trustees. The
Board is comprised of the Mayor of the City, one member of the City Council appointed by the City Council,
the City Treasurer, the City Human Resources Director, three members of the retirement system to be
elected by the members of the system under rules adopted by the board, two residents of the State of
Michigan appointed by the Mayor, by and with the consent of the City Council, one of which is a retiree of
the retirement system. It is accounted for as a separate pension trust fund. Separate financial statements
are not issued for the Plan.
Federal Grant Programs.Amounts received or receivable from grantor agencies are subject to audit and
potential adjustment by grantor agencies, principally the federal government. Any disallowed claims,
including amounts already collected, may constitute a liability of the applicable funds. The amount, if any,
of expenditures which may be disallowed by the grantor cannot be determined at this time although the
government expects such amounts, if any, to be immaterial.
93
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Retirees and beneficiaries currently receiving benefits 909
Terminated employees entitled to but not yet receiving benefits 72
Vested and non-vested active participants 371
Total membership 1,352
Multiplier
Percentage
United Auto Workers (UAW):
Hired after October 18, 2013 1.70%
All others 2.75%
Teamsters Local 214:
Hired after September 2012 1.25%
All others 1.80%
Teamsters Local 580:
Hired after May 19, 2014 1.25%
All others 1.80%
Non-bargaining and all others
Hired after April 1, 2014 1.25%
All others 1.60%
Plan Membership. At December 31, 2015, plan membership consisted of the following:
Benefits Provided.Employees who retire with minimum age and years of service requirements are entitled
to annual retirement benefits, payable in monthly installments for life, in an amount equal to a percentage
of their final average compensation times years of credited service. Final average compensation is defined
as the average of the highest annual compensation paid over 2 consecutive years of credited service within
the last 10 years of credited service immediately preceding a member's termination of employment. The
benefit payments are calculated using the following rates for the various groups of general employees:
Bargaining Unit/Employee
Group
Summary of Significant Accounting Policies.The financial statements of the Plan are prepared using the
accrual basis of accounting. Plan member contributions are recognized in the period which the contributions
are due. The City’s contributions are recognized when due and a formal commitment to provide the
contribution has been made. Benefits and refunds are recognized when due and payable in accordance with
the terms of the Plan. Administration of the Plan is funded through the Plan’s investment earnings.
Method Used to Value Investments.Plan investments are reported at fair value. Short-term investments are
reported at cost, which approximates fair value. Securities traded on a national or international exchange
are valued at the last reported sales price at current exchange rates. Investments for which market
quotations are not readily available are valued at their fair values as determined by the custodian under the
direction of the Plan Board of Trustees, with the assistance of a valuation service.
All members may retire at age 50 with 25 or more years of credited service, or age 58 with 8 or more years
of credited service. Members are vested after completing 8 years of credited service. Retirement options
that provide for survivor benefits are available to members. The plan also provides death and disability
benefits. If a member leaves employment or dies before vesting, accumulated member contributions plus
interest are refunded to the member or designated beneficiary. Members who are vested and terminate
their employment prior to retirement will receive their benefit as a life annuity beginning at age 58.
94
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Contribution
Percentage
United Auto Workers (UAW) 3.00%
Teamsters Local 214:
Hired after September 2012 5.00%
All others 6.50%
Teamsters Local 580:
Hired after May 9, 2014 5.00%
All others 6.35%
District court Teamsters:
Hired after April 2014 5.00%
All others 5.50%
District court exempt 5.50%
All others 6.50%
Bargaining Unit/Employee
Group
Concentrations.At June 30, 2016, the Plan held certain investments (other than those issued or explicitly
guaranteed by the U.S. government, mutual funds, external investment pools, or other pooled investments)
in certain organizations that represent 5% or more of the Plan's fiduciary net position. Please see Footnote
4 for the details of these concentrations.
Rate of Return.For the year ended June 30, 2016, the annual money-weighted rate of return on pension
plan investments, net of pension plan investment expense, was (1.60%). The money-weighted rate of return
expresses investment performance, net of investment expense, adjusted for the changing amounts actually
invested.
Contributions.The contribution requirements of Plan members are established and may be amended by the
City Council in accordance with City policies, union contracts, and Plan provisions. Employees are required
to make contributions to the Plan in rates from 3.00 to 6.50% depending on bargaining unit and hire date.
The City is required to contribute at actuarially determined rates expressed as a percentage of covered
payroll. The City’s contribution rate for the plan for the year ended June 30, 2016 was 44.1% of projected
valuation payroll.
Investment Policy.The plan's policy in regard to the allocation of invested assets is established and may be
amended by the Board of Trustees. The investment policy has been formulated based on consideration of a
wide range of policies and describes the prudent investment process that the Board deems appropriate. The
Plan's asset allocation policy is shown on the following pages.
95
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Balance
Employee savings fund 16,067,427$
Retirement reserve fund 134,629,178
Pension accumulation fund (2,814,285)
Members benefit fund 16,167,592
Health insurance fund 25,843,649
Total pension liability 324,725,530$
Plan fiduciary net position 164,049,912
Net pension liability 160,675,618$
Plan fiduciary net position as
percentage of total pension
liability 50.52%
Inflation 3.10%
Salary increases 3.10%, plus service based increases
Investment rate of return 7.60%, net of investment expense and including
inflation
Mortality is based on the RP-2000 tables (with Blue Collar adjustments for Police and Fire) for males and
females. For Disabled members, the disabled versions of these tables are used with a 5 year age setback for
males. Each of these tables is projected to 2008 using Scale BB. Future improvements in mortality for non-
disabled members are anticipated by projecting these tables an additional 15 years using 50% of Scale BB.
The actuarial assumptions used in the December 31, 2015 valuation were based on the results of actuarial
experience analysis conducted in 2012. An assumption review was conducted 2016, the pending results of
which will be applicable in fiscal year 2017.
Actuarial Assumptions.The total pension liability was determined by an actuarial valuation as of December
31, 2015, rolled forward to June 30, 2016, using the following actuarial assumptions, applied to all periods
included in the measurement:
Reserves.In accordance with the Plan policy, the City establishes reserves for various purposes. The
reserves are adjusted annually based on recommendations from the City's actuaries. The policy for creating
and adjusting reserves was established and can be amended by the Plan Board of Trustees. A summary of
the Plan reserves at June 30, 2016 is as follows:
Reserve/Group
Net Pension Liability.The components of the net pension liability for the employees' retirement system at
June 30, 2016 were as follows:
96
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Target
Allocation
Long-term
Expected Real
Rate of Return
Money-
Weighted Rate
of Return
Domestic equity 29.30% 5.74% 1.69%
International equity - developed 13.80% 5.71% 0.79%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income 21.90% 3.01% 0.66%
Real estate 10.00% 4.81% 0.48%
Global opportunistic fixed income 10.00% 4.12% 0.41%
Global equity long/short 10.00% 4.51% 0.45%
Opportunistic strategy 1.00% 4.41% 0.04%
100.00% 4.79%
Inflation 3.10%
Risk adjustments -0.29%
Investment rate of return 7.60%
Asset Class
Discount Rate.The discount rate used to measure the total pension liability was 7.09%. 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
pension plan’s fiduciary net position was projected to be exhausted in the year 2056. Therefore, the
discount rate represents the single equivalent rate resulting from discounting at the long-term expected
rate of return until 2056, and discounting with the 20-year AA municipal bond index rate of 2.59%
thereafter. This projection is done on a closed group basis, per GASB requirements. On an ongoing, open-
group basis, it is unlikely that the funds will be depleted because funding progress is frequently reviewed
and adjustments are made to contribution levels.
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each 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. This is then modified through a Monte-
Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline expected
return. Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan’s target asset allocation as of June 30, 2016, and the final investment return assumption, are
summarized in the following table:
97
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Total Pension
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability
(a) - (b)
Balances at June 30, 2015 319,702,427$ 178,556,474$ 141,145,953$
Changes for the year:
Service cost 2,977,084 - 2,977,084
Interest 22,268,516 - 22,268,516
Differences between expected and
actual experience (4,937,823) - (4,937,823)
Changes in assumptions 7,575,775 - 7,575,775
Employer contributions - 10,181,620 (10,181,620)
Employee contributions - 1,088,943 (1,088,943)
Net investment income (loss) - (2,790,190) 2,790,190
Benefit payments, including refunds of
employee contributions (22,860,449) (22,860,449) -
Administrative expense - (126,486) 126,486
Net changes 5,023,103 (14,506,562) 19,529,665
Balances at June 30, 2016 324,725,530$ 164,049,912$ 160,675,618$
One Percent
Decrease
(6.09%)
Current
Discount Rate
(7.09%)
One Percent
Increase
(8.09%)
Net pension liability $ 191,228,508 $ 160,675,618 $ 134,454,989
ChangesintheNetPensionLiability.The components of the change in the net pension liability are
summarized as follows:
Sensitivity of the Net Pension Liability to Changes in the Discount Rate.The following presents the net
pension liability of the City, calculated using the discount rate of 7.09%, as well as what the City’s net
pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.09%) or 1-percentage-point higher (8.09%) than the current rate:
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CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Net Deferred
Outflows
(Inflows) of
Resources
Changes in benefit terms -$ -$ -$
Difference between expected and actual experience - 5,432,658 (5,432,658)
Changes in assumptions 5,050,517 - 5,050,517
Net difference between projected and actual earnings
on pension plan investments 18,426,381 - 18,426,381
23,476,898 5,432,658 18,044,240
Contributions subsequent to measurement date - - -
Total 23,476,898$ 5,432,658$ 18,044,240$
Year Ended
June 30, Amount
2017 3,812,870$
2018 5,953,647
2019 5,074,329
2020 3,203,394
Total 18,044,240$
Police and Fire Retirement System
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions.For the year ended June 30, 2016, the City recognized pension expense of $14,869,224. At June
30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Plan Description.The City sponsors and administers the Police and Fire Retirement System (the “Plan”), a
single-employer, defined benefit pension plan that covers all police officers and fire fighters who are full-
time employees of the City. The Plan was established and may be amended by the City Council and is
administered by an eight member Board of Trustees. The Board is comprised of the Mayor of the City, one
member of the City Council appointed by the City Council, the City Treasurer, a resident of the City who
shall be appointed by the Mayor, by and with the consent of Council, two members each of the police and
fire departments, to be elected by all the members of their respective departments. It is accounted for as
a separate pension trust fund. Separate financial statements are not issued for the Plan.
Payable to the Pension Plan.At June 30, 2016, the City did not have any outstanding amount of
contributions to the pension plan required for the year ended June 30, 2016.
Amounts reported as deferred outflows of resources and deferred inflows of resources related to pension
will be recognized in pension expense as follows:
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CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Retirees and beneficiaries currently receiving benefits 723
Terminated employees entitled to but not yet receiving benefits 38
Vested and non-vested active participants 349
Total membership 1,110
Method Used to Value Investments.Plan investments are reported at fair value. Short-term investments are
reported at cost, which approximates fair value. Securities traded on a national or international exchange
are valued at the last reported sales price at current exchange rates. Investments for which market
quotations are not readily available are valued at their fair values as determined by the custodian under the
direction of the Plan Board of Trustees, with the assistance of a valuation service.
Plan Membership. At December 31, 2015, plan membership consisted of the following:
Investment Policy.The plan's policy in regard to the allocation of invested assets is established and may be
amended by the Board of Trustees. The investment policy has been formulated based on consideration of a
wide range of policies and describes the prudent investment process that the Board deems appropriate. The
Plan's asset allocation policy is shown on the following pages.
Contributions.The contribution requirements of Plan members are established and may be amended by the
City Council in accordance with City policies, union contracts, and Plan provisions. Fire members are
required to contribute 10.0% of their annual wages to the plan. Police supervisors are required to
contribute 9.52% and police non-supervisors, 9.0%. Chapter 294 of the City of Lansing's Ordinance
establishes benefit provisions and requires that the portion of the annuity and pension reserves (which are
determined annually by the City’s actuary) not financed by member contributions shall be financed by
annual appropriations. The City’s contribution rate for the plan for the year ended June 30, 2016 was
40.2% of projected valuation payroll.
Benefits Provided.Annual retirement allowances are determined by multiplying final average compensation
by 3.2% for the first 25 years of credited service. The maximum allowance is 80% of final average
compensation. Final average compensation is the member's highest wages for 2 consecutive years.
Summary of Significant Accounting Policies.The financial statements of the Plan are prepared using the
accrual basis of accounting. Plan member contributions are recognized in the period which the contributions
are due. The City’s contributions are recognized when due and a formal commitment to provide the
contribution has been made. Benefits and refunds are recognized when due and payable in accordance with
the terms of the Plan. Administration of the Plan is funded through the Plan’s investment earnings.
Members may retire at age 55, or at any age with 25 or more years of credited service. Members are vested
after completing 10 years of credited service. Members are required to retire at age 60 (Police) or 70
(Fire). When an employee who had retired subsequent to August 31, 1966, dies, the plan provides for an
automatic pension to the retiree's spouse. This automatic pension is equal to 50% of the regular retirement
benefit the employee had been receiving at time of death. Effective July 30, 1990, members may elect a
reduced benefit, either 93% or 86% of the regular benefit, thereby increasing the spouse pension to 75% or
86% of the regular benefit, respectively. Alternately, members may elect a non-spousal beneficiary option.
The plan provides death and disability benefits. If a member leaves employment or dies before vesting,
accumulated member contributions plus interest are refunded to the member or designated beneficiary.
Members who are vested and terminate their employment have the option of deferred retirement benefits
until age 55 or withdrawing their contribution, thereby forfeiting any future benefits.
100
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Balance
Retirement reserve fund 273,115,398$
Health insurance fund 29,946,038
Total pension liability 418,348,450$
Plan fiduciary net position 273,115,398
Net pension liability 145,233,052$
Plan fiduciary net position as
percentage of total pension
liability 65.28%
Inflation 3.10%
Salary increases 3.10%, plus service based increases
Investment rate of return
Actuarial Assumptions.The total pension liability was determined by an actuarial valuation as of December
31, 2015, rolled forward to June 30, 2016, using the following actuarial assumptions, applied to all periods
included in the measurement:
Net Pension Liability.The components of the net pension liability for the police and fire retirement system
at June 30, 2016, were as follows:
7.60%, net of investment expense and including
inflation
Mortality is based on the RP-2000 tables (with Blue Collar adjustments for Police and Fire) for males and
females. For Disabled members, the disabled versions of these tables are used with a 5 year age setback for
males. Each of these tables is projected to 2008 using Scale BB. Future improvements in mortality for non-
disabled members are anticipated by projecting these tables an additional 15 years using 50% of Scale BB.
Rate of Return.For the year ended June 30, 2016, the annual money-weighted rate of return on pension
plan investments, net of pension plan investment expense, was (2.09%). The money-weighted rate of return
expresses investment performance, net of investment expense, adjusted for the changing amounts actually
invested.
Concentrations.At June 30, 2016, the Plan held certain investments (other than those issued or explicitly
guaranteed by the U.S. government, mutual funds, external investment pools, or other pooled investments)
in certain organizations that represent 5% or more of the Plan's fiduciary net position. Please see Footnote
4 for the details of these concentrations.
Reserves.In accordance with the Plan policy, the City establishes reserves for various purposes. The
reserves are adjusted annually based on recommendations from the City's actuaries. The policy for creating
and adjusting reserves was established and can be amended by the Plan Board of Trustees. A summary of
the Plan reserves at June 30, 2016 is as follows:
Reserve/Group
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CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Target
Allocation
Long-term
Expected Real
Rate of Return
Money-
Weighted Rate
of Return
Domestic equity 29.30% 5.74% 1.69%
International equity - developed 13.80% 5.71% 0.79%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income 21.90% 3.01% 0.66%
Real estate 10.00% 4.81% 0.48%
Global opportunistic fixed income 10.00% 4.12% 0.41%
Global equity long/short 10.00% 4.51% 0.45%
Opportunistic strategy 1.00% 4.41% 0.04%
100.00% 4.79%
Inflation 3.10%
Risk adjustments -0.29%
Investment rate of return 7.60%
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each 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. This is then modified through a Monte-
Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline expected
return. Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan’s target asset allocation as of June 30, 2016, and the final investment return assumption, are
summarized in the following table:
Asset Class
Discount Rate.The discount rate used to measure the total pension liability was 7.49%. 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
pension plan’s fiduciary net position was projected to be exhausted in the year 2070. Therefore, the
discount rate represents the single equivalent rate resulting from discounting at the long-term expected
rate of return until 2070, and discounting with the 20-year AA municipal bond index rate of 2.59%
thereafter. This projection is done on a closed group basis, per GASB requirements. On an ongoing, open-
group basis, it is unlikely that the funds will be depleted because funding progress is frequently reviewed
and adjustments are made to contribution levels.
The actuarial assumptions used in the December 31, 2015 valuation were based on the results of actuarial
experience analysis conducted in 2012. An assumption review was conducted 2016, the pending results of
which will be applicable in fiscal year 2017.
102
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Total Pension
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability
(a) - (b)
Balances at June 30, 2015 400,117,548$ 295,296,649$ 104,820,899$
Changes for the year:
Service cost 6,371,845 - 6,371,845
Interest 30,197,513 - 30,197,513
Differences between expected and
actual experience 7,884,167 - 7,884,167
Changes in assumptions 3,281,341 - 3,281,341
Employer contributions - 10,884,312 (10,884,312)
Employee contributions - 2,608,214 (2,608,214)
Net investment loss - (6,040,910) 6,040,910
Benefit payments, including refunds of
employee contributions (29,503,964) (29,503,964) -
Administrative expense - (128,903) 128,903
Net changes 18,230,902 (22,181,251) 40,412,153
Balances at June 30, 2016 418,348,450$ 273,115,398$ 145,233,052$
One Percent
Decrease
(6.49%)
Current
Discount Rate
(7.49%)
One Percent
Increase
(8.49%)
Net pension liability $ 188,703,501 $ 145,233,052 $ 108,359,537
ChangesintheNetPensionLiability.The components of the change in the net pension liability are
summarized as follows:
Sensitivity of the Net Pension Liability to Changes in the Discount Rate.The following presents the net
pension liability of the City, calculated using the discount rate of 7.49%, as well as what the City’s net
pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.49%) or 1-percentage-point higher (8.49%) than the current rate:
103
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Net Deferred
Outflows
(Inflows) of
Resources
Changes in benefit terms -$ -$ -$
Difference between expected and actual experience 7,493,123 - 7,493,123
Changes in assumptions 2,461,006 - 2,461,006
Net difference between projected and actual earnings
on pension plan investments 30,448,280 - 30,448,280
40,402,409 - 40,402,409
Contributions subsequent to measurement date - - -
Total 40,402,409$ -$ 40,402,409$
Year Ended
June 30, Amount
2017 11,865,484$
2018 11,865,484
2019 11,075,485
2020 5,595,956
Total 40,402,409$
Payable to the Pension Plan.At June 30, 2016, the City did not have any outstanding amount of
contributions to the pension plan required for the year ended June 30, 2016.
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions.For the year ended June 30, 2016, the City recognized pension expense of $24,016,657. At June
30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Amounts reported as deferred outflows of resources and deferred inflows of resources related to pension
will be recognized in pension expense as follows:
104
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Employees' Employees' Police Police Employees'
Retirement Retirement and Fire and Fire Money Retiree
System System Retirement Retirement Purchase Health Care
Pension OPEB System System OPEB Pension Plan VEBA Totals
Assets
Cash and cash equivalents 1,000$ -$ 1,000$ -$ -$ -$ 2,000$
Investments:
Money market funds 2,531,855 396,375 2,337,854 257,583 - 1,575,818 7,099,485
Government obligations 20,304,455 3,178,768 27,426,577 3,021,834 14,571 - 53,946,205
Corporate bonds 21,240,507 3,325,312 29,014,365 3,196,775 - - 56,776,959
Common stocks 36,962,177 5,786,620 71,061,216 7,829,456 - - 121,639,469
Private equity partnerships 14,918,018 2,335,493 - - - - 17,253,511
Mutual funds 69,119,918 10,821,081 141,954,329 15,640,390 2,010,270 21,247,980 260,793,968
Contribution receivable 1,855 - 1,302,152 - 4,628 3,573 1,312,208
Dividends and interest receivable 174,277 - 254,452 - - 37 428,766
Total assets 165,254,062 25,843,649 273,351,945 29,946,038 2,029,469 22,827,408 519,252,571
Liabilities
Accounts payable 1,204,150 - 236,547 - - - 1,440,697
Net position restricted for
Pension benefits 164,049,912 - 273,115,398 - 2,029,469 - 439,194,779
Other postemployment benefits - 25,843,649 - 29,946,038 - 22,827,408 78,617,095
Total net position 164,049,912$ 25,843,649$ 273,115,398$ 29,946,038$ 2,029,469$ 22,827,408$ 517,811,874$
Pension and Other Postemployment Benefits Net Position
Financial statements for individual pension and employee benefit plans:
105
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Employees' Employees' Police Police Employees'
Retirement Retirement and Fire and Fire Money Retiree
System System Retirement Retirement Purchase Health Care
Pension OPEB System System OPEB Pension Plan VEBA Totals
Additions
Investment income (loss):
Net appreciation (depreciation)
in fair value of investments (6,698,095)$ 5,214,104$ (8,968,428)$ 4,907,324$ -$ (133,652)$ (5,678,747)$
Interest income 855,670 - 1,194,152 - 19,731 453 2,070,006
Dividend income 523,380 - 1,008,773 - - 401,467 1,933,620
Investment expenses - - - - (6,464) - (6,464)
Net investment income (loss)(5,319,045) 5,214,104 (6,765,503) 4,907,324 13,267 268,268 (1,681,585)
Contributions:
Employer 10,181,620 8,814,471 10,884,312 12,879,016 66,905 1,458,300 44,284,624
Plan members 1,088,943 - 2,608,214 - 49,817 - 3,746,974
Total contributions 11,270,563 8,814,471 13,492,526 12,879,016 116,722 1,458,300 48,031,598
Total additions 5,951,518 14,028,575 6,727,023 17,786,340 129,989 1,726,568 46,350,013
Deductions
Participant benefits 22,860,449 8,599,473 29,503,964 11,277,516 20,097 - 72,261,499
Administrative expense 768,033 - 1,118,632 - - 56,111 1,942,776
Total deductions 23,628,482 8,599,473 30,622,596 11,277,516 20,097 56,111 74,204,275
Change in net position (17,676,964) 5,429,102 (23,895,573) 6,508,824 109,892 1,670,457 (27,854,262)
Net position restricted
for pension and other
postemployment benefits:
Beginning of year 181,726,876 20,414,547 297,010,971 23,437,214 1,919,577 21,156,951 545,666,136
End of year 164,049,912$ 25,843,649$ 273,115,398$ 29,946,038$ 2,029,469$ 22,827,408$ 517,811,874$
Changes in Pension and Other Postemployment Benefits Net Position
106
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
17. OTHER POSTEMPLOYMENT BENEFITS
Voluntary Employees Beneficiary Association (VEBA)
Employees' Retirement System
Method Used to Value Investments.Plan investments are reported at fair value. Securities traded on a
national or international exchange are valued at the last reported sales price at current exchange rates.
Investments for which market quotations are not readily available are valued at their fair values as
determined by the custodian under the direction of each plans’ board of trustees, with the assistance of a
valuation service.
Primary Government
Plan Description.The City of Lansing contributes to the Employees’ Retirement System, the Police and
Fire Retirement System, and the Voluntary Employees Beneficiary Association amounts to pre-fund
postemployment healthcare. In the Employees’ Retirement System and the Police and Fire Retirement
System, these other postemployment benefits (OPEB) are set up as reserves in the pension plans, and their
investments are commingled with the investments of the pension plan. Portfolio makeup is reported as a
percentage of total pension plan assets. Earnings are calculated based on a seven year smoothed rate of
return of the retirement systems. Eligible participants include any retirees who receive pension benefits
under their respective pension plans, with the exception of Teamster 580 employees hired after May 2014.
OPEB plan provisions are established and may be amended by the City Council, subject to the City’s
various collective bargaining agreements. Separate financial statements are not prepared for the plans.
The City of Lansing Voluntary Employees Beneficiary Association (the “Plan”) is a single-employer defined
benefit postemployment healthcare plan established by the City to provide medical and healthcare
benefits for retirees and their beneficiaries. Eligible participants include any retirees who receive pension
benefits under one of the City’s pension plans. The Plan is funded by a trust agreement established
pursuant to Section 501(c)(9) of the Internal Revenue Code that allows for the formation of a VEBA. During
the year, the City contributed $1,458,300 to the Plan.
The City provides postemployment health care benefits, in accordance with labor agreements, to full-time
employees of the City and employees of the 54-A District Court (not including police officers and
firefighters who are members of the Police and Fire Retirement System). Members eligible for pension
benefits under the Employees’ Retirement System are also eligible to receive health care benefits, with
the exception of Teamster 580 employees hired after May, 2014. The City provides the full cost of health
benefits to retirees, payable to health care vendors,and also reimburses retirees eligible for Medicare
benefits of $121.80 per month for each covered retiree and eligible dependent(s) eligible for retiree
healthcare. The payments are charged to the fringe benefit internal service fund of the City and are
recognized as expenses as payments are made.
107
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Retirees and beneficiaries receiving benefits 865
Terminated plan members entitled to but
not yet receiving benefits 52
Active plan members 374
Total 1,291
Annual required contribution $ 11,342,560
Interest on net OPEB obligation 838,452
Adjustment to annual required contribution (733,678)
Net OPEB cost (expense)11,447,334
Contributions made (8,814,471)
Increase in net OPEB obligation 2,632,863
Net OPEB obligation, beginning of year 11,032,264
Net OPEB obligation, end of year 13,665,127$
Percentage
of Annual
Annual OPEB OPEB Cost Net OPEB
Year Ended Cost Contributed Obligation
2014 14,057,619$ 78.6%6,973,885$
2015 13,270,701 69.4% 11,032,264
2016 11,447,334 77.0% 13,665,127
Three-Year Trend Information
The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan, and the net
OPEB obligation for the current year and the two preceding years were as follows:
Membership of the Plan consisted of the following at December 31, 2015, the date of the most recent
actuarial valuation:
During the year, the City contributed $8,814,471 (direct benefit payments of $8,599,471 and City
contributions of $215,000) to the Plan.
The schedule of employer contributions, presented as required supplementary information (RSI) following
the notes to the financial statements, presents trend information about the amounts contributed to the
plan by employers in comparison to the ARC, an amount that is actuarially determined in accordance with
the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing
basis, is projected to cover normal cost for each year and amortize any unfunded actuarial liabilities (or
funding excess) over a period not to exceed thirty years.
108
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Retirees and beneficiaries receiving benefits 663
Terminated plan members entitled to but
not yet receiving benefits 23
Active plan members 346
Total 1,032
Funded Status and Funding Progress.As of December 31, 2015, the most recent actuarial valuation date,
the Plan was 26.0% funded. The actuarial accrued liability for benefits was $175,482,584, and the actuarial
value of assets was $45,570,448, resulting in an unfunded actuarial accrued liability (UAAL) of
$129,912,136. The covered payroll (annual payroll of active employees covered by the Plan) was
$20,583,058, and the ratio of the UAAL to the covered payroll was 630.8%. The Employees’ Retirement
System and VEBA were combined in the actuarial valuation.
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. 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 is increasing or decreasing over time relative to the actuarial accrued
liabilities for benefits.
Actuarial Methods and Assumptions.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.
In the December 31, 2015 actuarial valuation, the entry age actuarial cost method was used. The actuarial
assumptions included a 7.6 percent investment rate of return (net of administrative expenses), which
includes a 3.1 percent inflation assumption. The actuarial value of assets was determined using techniques
that spread the effects of short-term volatility in the market value of investments over a five-year period.
The UAAL is being amortized as a level percentage of projected payroll on an open basis. The remaining
amortization period at December 31, 2015, was 26 years.
Police and Fire Retirement System
The City also provides postemployment health care benefits, in accordance with labor agreements, to
members who are eligible to receive pension benefits under the Police and Fire Retirement System. The
City provides the full cost of health benefits to retirees, payable to health care vendors, and also
reimburses retirees eligible for Medicare benefits of $121.80 per month for each covered retiree and
dependent(s). The payments are charged to the fringe benefit internal service fund of the City and are
recognized as expenses as payments are made.
Membership of the Plan consisted of the following at December 31, 2015, the date of the most recent
actuarial valuation:
109
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Annual required contribution 14,840,496$
Interest on net OPEB obligation 3,492,342
Adjustment to annual required contribution (3,055,937)
Net OPEB cost (expense)15,276,901
Contributions made (12,879,016)
Increase in net OPEB obligation 2,397,885
Net OPEB obligation, beginning of year 45,951,872
Net OPEB obligation, end of year 48,349,757$
Percentage
of Annual
Annual OPEB OPEB Cost Net OPEB
Year Ended Cost Contributed Obligation
2014 17,489,692$ 63.9% 39,589,912$
2015 17,923,366 64.5% 45,951,872
2016 15,276,901 84.3% 48,349,757
Funded Status and Funding Progress.As of December 31, 2015, the most recent actuarial valuation date,
the Plan was 8.8% funded. The actuarial accrued liability for benefits was $327,413,936, and the actuarial
value of assets was $28,895,679, resulting in an unfunded actuarial accrued liability (UAAL) of
$298,518,257. The covered payroll (annual payroll of active employees covered by the Plan) was
$25,533,302, and the ratio of the UAAL to the covered payroll was 1,169.1%.
Three-Year Trend Information
The schedule of employer contributions, presented as required supplementary information (RSI) following
the notes to the financial statements, presents trend information about the amounts contributed to the
plan by employers in comparison to the ARC, an amount that is actuarially determined in accordance with
the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing
basis, is projected to cover normal cost for each year and amortize any unfunded actuarial liabilities (or
funding excess) over a period not to exceed thirty years.
The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan, and the net
OPEB obligation for the current year and the two preceding years were as follows:
During the year, the City contributed $12,879,016 (direct benefit payments of $11,277,516 and City
contributions of $1,601,500) to the Plan.
110
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
18. OPERATING LEASES
Year Ending
June 30 Amount
2017 572,644$
2018 570,913
2019 573,367
2020 571,900
Actuarial Methods and Assumptions.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.
In the December 31, 2015 actuarial valuation, the entry age actuarial cost method was used. The actuarial
assumptions included a 7.6 percent investment rate of return (net of administrative expenses), which
includes a 3.1 percent inflation assumption. The actuarial value of assets was determined using techniques
that spread the effects of short-term volatility in the market value of investments over a five-year period.
The UAAL is being amortized as a level percentage of projected payroll on an open basis. The remaining
amortization period at December 31, 2015, was 26 years.
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. 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 is increasing or decreasing over time relative to the actuarial accrued
liabilities for benefits.
During fiscal year 2014, the City entered into an operating lease with the Lansing School District (the
"District"), for approximately 86,900 square feet of the Hill Center for Academics and Technology for the
purpose of operating a police precinct. The term of the lease runs through June 30, 2018. The City is
required to make approximately $800,000 worth of improvements to the leased space, the cost of which
will be capitalized by the District. In addition, beginning July 1, 2016, rent payments will be made to the
District by the City in monthly installments of $2,083 ($25,000 annually) and $10,417 ($125,000 annually)
for the year ended June 30, 2018, respectively.
The Tax Increment Finance Authority (TIFA) component unit has entered into an operating lease with the
City of Lansing and County of Ingham Joint Building Authority (the "Joint Authority") related to the City's
use of a building constructed by the Joint Authority. The payments related to this lease are paid by the
TIFA, pursuant to a payment agreement between the City and the TIFA. The total of such payments
amounted to $573,237 for the year ended June 30 2016. Future minimum lease payments for this lease are
as follows:
111
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
19. RESTATEMENT
Net position of the Brownfield Redevelopment Authority component unit was decreased on July 1, 2015 by
$457,816 to reflect the fact that certain outstanding loans receivable reported in prior years are only
collectible from outside parties if future tax captures are insufficient to cover the required payments
(contingent receivables). Accordingly, these receivables have been removed from the face of the financial
statements, and disclosed in Note 5, instead.
112
REQUIRED SUPPLEMENTARY INFORMATION
113
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
2016 2015 2014
Total pension liability
Service cost 2,977,084$ 2,857,948$ 2,982,624$
Interest on total pension liability 22,268,516 22,671,909 22,722,630
Difference between expected and actual experience (4,937,823) (6,422,330) -
Assumption changes 7,575,775 - -
Benefit payments, including refunds (22,860,449) (22,462,587) (22,790,522)
Net change in total pension liability 5,023,103 (3,355,060) 2,914,732
Total pension liability, beginning of year 319,702,427 323,057,487 320,142,755
Total pension liability, end of year 324,725,530 319,702,427 323,057,487
Plan fiduciary net position
Employer contributions 10,181,620 10,547,556 9,361,009
Employee contributions 1,088,943 1,128,120 1,290,678
Pension plan net investment income (loss)(2,790,190) 4,399,543 17,887,635
Benefit payments (including refunds)(22,860,449) (22,462,587) (22,957,379)
Pension plan administrative expense (126,486) (174,818) (741,037)
Net change in plan fiduciary net position (14,506,562) (6,562,186) 4,840,906
Plan fiduciary net position, beginning of year 178,556,474 185,118,660 180,277,754
Plan fiduciary net position, end of year 164,049,912 178,556,474 185,118,660
Net pension liability 160,675,618$ 141,145,953$ 137,938,827$
Plan fiduciary net position as a percentage
of total pension liability 50.5% 55.9% 57.3%
Covered payroll 23,085,894$ 19,769,460$ 20,874,143$
Net pension liability as a percentage
of covered payroll 696.0% 714.0% 660.8%
Fiscal Year Ending June 30,
Schedules of Changes in Net Pension Liability and Related Ratios
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10
years of data will be presented.
114
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Schedule of the Net Pension Liability
Fiscal Year
Ending
June 30,
Total Pension
Liability
Plan Net
Position
Net Pension
Liability
Plan Net
Position as
Percentage of
Total Pension
Liability
Covered
Payroll
Net Pension
Liability as
Percentage of
Covered
Payroll
2014 323,057,487$ 185,118,660$ 137,938,827$ 57.3% 20,874,143$ 660.8%
2015 319,702,427 178,556,474 141,145,953 55.9% 19,769,460 714.0%
2016 324,725,530 164,049,912 160,675,618 50.5% 23,085,894 696.0%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10
years of data will be presented.
115
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Fiscal Year
Ending
June 30,
Actuarially
Determined
Contribution*
Actual
Contribution
Contribution
Deficiency
(Excess)*
Covered
Payroll
Actual
Contribution
as Percentage
of Covered
Payroll
2007 5,231,000$ 5,231,000$ -$ 31,797,000$ 16.5%
2008 6,022,000 6,022,000 - 29,688,000 20.3%
2009 6,048,000 6,477,000 429,000 30,602,000 21.2%
2010 6,472,349 6,043,861 (428,488) 27,766,628 21.8%
2011 7,297,083 7,297,083 - 26,068,735 28.0%
2012 7,596,879 7,523,534 (73,345) 22,838,598 32.9%
2013 8,586,536 8,586,536 - 20,874,143 41.1%
2014 9,361,009 9,361,009 - 21,521,242 43.5%
2015 10,547,556 10,547,556 - 19,769,460 53.4%
2016 10,181,620 10,181,620 - 23,085,894 44.1%
*
Notes to Schedule of Contributions
Valuation Date December 31, 2015 (rolled forward to June 30, 2016)
Notes
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percent of payroll, closed
Remaining amortization
period 26 years
Asset valuation method Closed; 5-year smooth market
Inflation 3.10%
Salary increases 3.10% plus service based increases
Investment rate of return 7.60%, net of investment expense and including inflation
Retirement age
Mortality RP-2000 Combined Healthy Tables for males and females. For disabled members,
the disabled version of these tables are used with a 5 year age setback for males.
Schedule of Contributions
The City contributed in excess of its FY 2009 Actuarially Determined Employer Contribution (ADEC). The City's FY
2010 contribution was reduced by the dollar amount of the FY 2009 overpayment. The FY 2012 City contribution
was reduced by $73,345 in recognition of additional contributions by United Auto Workers (UAW) employees,
which were negotiated and contributed after the establishment of the June 30, 2012 ADEC from the December
31, 2010 valuation.
The actuarially determined contribution was based on projected covered payroll. Employer contributions were
made in full based on actual covered payroll. Accordingly, the actuarially-determined contribution has been
expressed above as a percentage of actual payroll.
Actuarially determined contribution rates are calculated as of the June 30 that is
12 months prior to the beginning of the fiscal year in which contributions are
reported.
Age-based table of rates that are specific to the type of eligibility condition. Last
updated for the December 31, 2015 valuation. This was based on an actuarial
experience analysis conducted in 2012. An assumption review was conducted 2016,
the pending results of which will be applicable in fiscal year 2017.
116
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Fiscal Year
Ending
June 30,
Annual
Return
2014 13.67%
2015 2.43%
2016 -1.60%
(1)Annual money-weighted rate of return, net of investment expenses
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10
years of data will be presented.
Schedule of Investment Returns
(1)
117
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
2016 2015 2014
Total pension liability
Service cost 6,371,845$ 6,350,378$ 6,614,784$
Interest on total pension liability 30,197,513 29,159,382 27,896,927
Difference between expected and actual experience 7,884,167 3,159,996 -
Assumption changes 3,281,341 - -
Benefit payments, including refunds (29,503,964) (27,969,021) (26,270,724)
Net change in total pension liability 18,230,902 10,700,735 8,240,987
Total pension liability, beginning of year 400,117,548 389,416,813 381,175,826
Total pension liability, end of year 418,348,450 400,117,548 389,416,813
Plan fiduciary net position
Employer contributions 10,884,312 11,050,091 11,248,857
Employee contributions 2,608,214 2,950,832 2,911,896
Pension plan net investment income (loss)(6,040,910) 8,965,080 34,016,621
Benefit payments (including refunds)(29,503,964) (27,969,021) (26,852,038)
Pension plan administrative expense (128,903) (173,849) (1,141,506)
Net change in plan fiduciary net position (22,181,251) (5,176,867) 20,183,830
Plan fiduciary net position, beginning of year 295,296,649 300,473,516 280,289,686
Plan fiduciary net position, end of year 273,115,398 295,296,649 300,473,516
Net pension liability 145,233,052$ 104,820,899$ 88,943,297$
Plan fiduciary net position as a percentage
of total pension liability 65.3% 73.8% 77.2%
Covered payroll 27,078,405$ 24,407,740$ 25,611,974$
Net pension liability as a percentage
of covered payroll 536.3% 429.5% 347.3%
Fiscal Year Ending June 30,
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10
years of data will be presented.
Schedules of Changes in Net Pension Liability and Related Ratios
118
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedule of the Net Pension Liability
Fiscal Year
Ending
June 30,
Total Pension
Liability
Plan Net
Position
Net Pension
Liability
Plan Net
Position as
Percentage of
Total Pension
Liability
Covered
Payroll
Net Pension
Liability as
Percentage of
Covered Payroll
2014 389,416,813$ 300,473,516$ 88,943,297$ 77.2% 25,611,974$ 347.3%
2015 400,117,548 295,296,649 104,820,899 73.8% 24,407,740 429.5%
2016 418,348,450 273,115,398 145,233,052 65.3% 27,078,405 536.3%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years
of data will be presented.
119
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedule of Contributions
Fiscal Year
Ending
June 30,
Actuarially
Determined
Contribution*
Actual
Contribution
Contribution
Deficiency
(Excess)*
Covered
Payroll
Actual
Contribution
as Percentage
of Covered
Payroll
2007 5,385,960$ 5,385,960$ -$ 29,600,000$ 18.2%
2008 6,520,974 6,520,974 - 30,161,000 21.6%
2009 6,094,397 6,483,000 388,603 30,443,000 21.3%
2010 7,179,360 6,790,757 (388,603) 28,536,056 23.8%
2011 8,240,688 8,240,688 - 25,128,835 32.8%
2012 9,242,173 9,057,080 (185,093) 26,121,411 34.7%
2013 10,133,599 10,133,599 - 25,636,626 39.5%
2014 11,248,857 11,248,857 - 26,405,725 42.6%
2015 11,050,091 11,050,091 - 24,407,740 45.3%
2016 10,884,312 10,884,312 - 27,078,405 40.2%
*
Notes to Schedule of Contributions
Valuation Date December 31, 2015 (rolled forward to June 30, 2016)
Notes
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percent of payroll, closed
Remaining amortization
period 26 years
Asset valuation method Closed; 5-year smooth market
Inflation 3.10%
Salary increases 3.10% plus service based increases
Investment rate of return 7.60%, net of investment expense and including inflation
Retirement age
Mortality RP-2000 Combined Healthy Tables for males and females. For disabled members, the
disabled version of these tables are used with a 5 year age setback for males.
The City contributed in excess of its FY 2009 Actuarially Determined Employer Contribution (ADEC). The City's FY
2010 contribution was reduced by the dollar amount of the FY 2009 overpayment. The FY 2012 City contribution was
reduced by $185,093 in recognition of additional contributions by International Association of Firefighters (IAFF)
employees, which were negotiated and contributed after the establishment of the June 30, 2012 ADEC from the
December 31, 2010 valuation.
The actuarially determined contribution was based on projected covered payroll. Employer contributions were made
in full based on actual covered payroll. Accordingly, the actuarially-determined contribution has been expressed
above as a percentage of actual payroll.
Actuarially determined contribution rates are calculated as of the June 30 that is 12
months prior to the beginning of the fiscal year in which contributions are reported.
Age-based table of rates that are specific to the type of eligibility condition. Last
updated for the December 31, 2015 valuation. This was based on an actuarial
experience analysis conducted in 2012. An assumption review was conducted 2016,
the pending results of which will be applicable in fiscal year 2017.
120
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Fiscal Year
Ending
June 30,
Annual
Return
2014 17.28%
2015 3.04%
2016 -2.09%
(1)Annual money-weighted rate of return, net of investment expenses
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years
of data will be presented.
Schedule of Investment Returns
(1)
121
Required Supplementary Information
Other Postemployment Benefit Plans
(amounts in thousands)
Employees' Retirement System and VEBA - Schedule of Funding Progress
Actuarial Actuarial UAAL as a
Actuarial Value of Accrued Underfunded Funded Covered % of Covered
Valuation Assets Liability AAL (UAAL) Ratio Payroll Payroll
Date (A)(B)(B-A)(A/B)(C)((B-A)/C)
12/31/2011 28,690$ 349,080$ 320,390$ 8.2%24,813$ 1291.2%
12/31/2013 37,629 248,376 210,747 15.2%20,874 1009.6%
12/31/2015 45,570 175,482 129,912 26.0%20,583 631.2%
Police and Fire Retirement System - Schedule of Funding Progress
Actuarial Actuarial Underfunded UAAL as a
Actuarial Value of Accrued (Overfunded) Funded Covered % of Covered
Valuation Assets Liability AAL (UAAL) Ratio Payroll Payroll
Date (A)(B)(B-A)(A/B)(C)((B-A)/C)
12/31/2011 18,679$ 421,353$ 402,674$ 4.4%25,129$ 1602.4%
12/31/2013 23,197 364,905 341,708 6.4%25,637 1332.9%
12/31/2015 28,896 327,414 298,518 8.8%25,533 1169.1%
Employees' Retirement System and VEBA - Schedule of Employer Contributions
Annual
Required Percentage
Year Ended Contribution of ARC
June 30, (ARC) Contributed
2014 14,040$ 78.7%
2015 13,195 69.8%
2016 11,343 77.7%
Police and Fire Retirement System - Schedule of Employer Contributions
Annual
Required Percentage
Year Ended Contribution of ARC
June 30, (ARC) Contributed
2014 16,852$ 66.5%
2015 17,491 66.1%
2016 14,840 86.8%
CITY OF LANSING, MICHIGAN
122
COMBINING AND INDIVIDUAL FUND FINANCIAL
STATEMENTS AND SCHEDULES
123
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2016
Special Debt Capital
Revenue Service Projects Permanent Totals
Assets
Cash and cash equivalents 157,846$ -$ -$ -$ 157,846$
Equity in pooled cash and investments 10,360,313 1,264 6,448,137 61,133 16,870,847
Investments - - - 1,700,000 1,700,000
Accounts receivable, net 6,125 176 1,202,858 - 1,209,159
Special assessments receivable - - 393,563 - 393,563
Loans receivable 1,428,378 - - - 1,428,378
Accrued interest receivable 2,286,367 - - 7,221 2,293,588
Due from other funds - - 1,404,970 - 1,404,970
Due from other governments 3,610,700 - - - 3,610,700
Inventories 809,977 - - - 809,977
Total assets 18,659,706$ 1,440$ 9,449,528$ 1,768,354$ 29,879,028$
Liabilities
Accounts payable 1,754,522$ -$ 1,654,789$ -$ 3,409,311$
Deposits payable 17,662 - - - 17,662
Accrued payroll 73,024 - - - 73,024
Indemnity bonds 16,131 - - - 16,131
Due to other funds 1,400,000 176 120,144 - 1,520,320
Due to component units - - 2,119,598 - 2,119,598
Advances from other funds - - 241,309 - 241,309
Due to other governments 828,989 - - - 828,989
Unearned revenue 262,621 - - - 262,621
Total liabilities 4,352,949 176 4,135,840 - 8,488,965
Deferred inflows of resources
Unavailable revenues - loans and
accrued interest receivable 3,514,745 - - - 3,514,745
Unavailable revenues - special
assessments - - 345,321 - 345,321
Total deferred inflows of resources 3,514,745 - 345,321 - 3,860,066
Fund balances
Nonspendable 809,977 - - 1,768,354 2,578,331
Restricted 6,484,128 1,264 449,273 - 6,934,665
Committed 3,697,907 - 4,729,346 - 8,427,253
Unassigned (deficit)(200,000) - (210,252) - (410,252)
Total fund balances 10,792,012 1,264 4,968,367 1,768,354 17,529,997
Total liabilities, deferred inflows of
resources and fund balances 18,659,706$ 1,440$ 9,449,528$ 1,768,354$ 29,879,028$
CITY OF LANSING, MICHIGAN
124
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2016
Special Debt Capital
Revenue Service Projects Permanent Totals
Revenues
Taxes and special assessments 507,581$ 503,077$ 59,190$ -$ 1,069,848$
Intergovernmental 18,743,787 - - - 18,743,787
Charges for services 4,598,231 - 980,995 - 5,579,226
Fines and forfeits 620,386 - - - 620,386
Interest and rents 59,849 264 7,522 7,437 75,072
Contributions 10,000 - - - 10,000
Other revenues 991,895 - - - 991,895
Total revenues 25,531,729 503,341 1,047,707 7,437 27,090,214
Expenditures
Current expenditures:
General government 3,352,867 - - - 3,352,867
Public safety 1,820,739 - - - 1,820,739
Public works 891,680 - - - 891,680
Highways and streets 10,838,473 - - - 10,838,473
Community development 3,442,110 - - - 3,442,110
Debt service:
Principal 1,295,000 1,415,000 - - 2,710,000
Interest 575,750 120,863 - - 696,613
Capital outlay 4,577,038 - 2,458,162 - 7,035,200
Total expenditures 26,793,657 1,535,863 2,458,162 - 30,787,682
Revenues over (under)
expenditures (1,261,928) (1,032,522) (1,410,455) 7,437 (3,697,468)
Other financing sources (uses)
Transfers in 4,983,670 1,032,817 2,782,297 21,782 8,820,566
Transfers out (2,549,240) - (1,103,469) (7,347) (3,660,056)
Issuance of long-term debt - 320,000 - - 320,000
Bond premium - 12,022 - - 12,022
Payment to refunded bond escrow agent - (332,053) - - (332,053)
Total other financing sources (uses)2,434,430 1,032,786 1,678,828 14,435 5,160,479
Net change in fund balances 1,172,502 264 268,373 21,872 1,463,011
Fund balances, beginning of year 9,619,510 1,000 4,699,994 1,746,482 16,066,986
Fund balances, end of year 10,792,012$ 1,264$ 4,968,367$ 1,768,354$ 17,529,997$
CITY OF LANSING, MICHIGAN
125
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126
CITY OF LANSING, MICHIGAN
Nonmajor Special Revenue Funds
Major Streets Fund – This fund accounts for revenues received from the State of Michigan for the
City's share of state gasoline and weight taxes, which is used for maintenance of major streets.
Local Streets Fund – This fund accounts for revenues received from the State of Michigan for the
City's share of state gasoline and weight taxes, which is used for maintenance of local streets.
Drug Law Enforcement Federal Fund – This fund accounts for federal revenues, from the
Departmens of Justice and Treasury, set aside for drug law enforcement under the provisions of
Federal Grant Agreements.
Drug Law Enforcement State and Local Fund – This fund accounts for state and local revenues,
from the Departmens of Justice and Treasury, set aside for drug law enforcement under the
provisions of State of Michigan Public Act 135 of 1985, as amended.
Community Development Block Grant Program Fund – This fund accounts for revenues received
from the Department of Housing and Urban Development. These revenues are restricted to
accomplishing the various objectives of Community Development Block Grant Programs, within
specific target areas.
Downtown Lansing, Inc. Fund – This fund accounts for assessments received from businesses
located in the district. The revenues are used for special events and maintenance of the district.
Building Department Fund – This fund accounts for revenues and expenditures resulting from the
enforcement of the State Construction Code Act of 1999 (PA 245 of 1999).
Parks Department Fund – This fund accounts for contributions and transfers which are restricted
for park expenditures.
State and Federal Grants Fund - This fund accounts for all revenues received from miscellaneous
grants and contributions. These revenues are used for projects as detailed in individual grant
applications.
Tri-County Metro Fund – This fund accounts for the operations of the Tri-County Metro Narcotics
Squad.
127
Combining Balance Sheet
Nonmajor Special Revenue Funds
June 30, 2016
Drug Law Community
Drug Law Enforcement Development
Major Local Enforcement State and Block Grant
Streets Streets Federal Local Program
Assets
Cash and cash equivalents -$ -$ -$ 23,000$ -$
Equity in pooled cash and investments 4,538,575 2,289,868 355,887 492,469 152,154
Accounts receivable, net - - - - -
Loans receivable - - - - 1,385,000
Accrued interest receivable - - - - 2,286,367
Due from other governments 1,620,097 337,135 - - 133,042
Inventories 809,977 - - - -
Total assets 6,968,649$ 2,627,003$ 355,887$ 515,469$ 3,956,563$
Liabilities
Accounts payable 611,387$ 416,260$ -$ 51,383$ 59,196$
Deposits payable - - - - -
Accrued payroll - - - - 26,000
Indemnity bonds 16,131 - - - -
Due to other funds - - - - 400,000
Due to other governments - - - - -
Unearned revenue - - - - -
Total liabilities 627,518 416,260 - 51,383 485,196
Deferred inflows of resources
Unavailable revenues - loans and
accrued interest receivable - - - - 3,471,367
Fund balances
Nonspendable 809,977 - - - -
Restricted 3,725,000 1,005,816 355,887 464,086 -
Committed 1,806,154 1,204,927 - - 200,000
Unassigned (deficit)- - - - (200,000)
Total fund balances 6,341,131 2,210,743 355,887 464,086 -
Total liabilities, deferred inflows of
resources and fund balances 6,968,649$ 2,627,003$ 355,887$ 515,469$ 3,956,563$
CITY OF LANSING, MICHIGAN
128
State and
Downtown Building Parks Federal Tri-County
Lansing, Inc. Department Department Grants Metro Totals
-$ -$ -$ -$ 134,846$ 157,846$
40,376 311,188 469,114 683,737 1,026,945 10,360,313
- 6,125 - - - 6,125
- - - 43,378 - 1,428,378
- - - - - 2,286,367
- - - 1,504,218 16,208 3,610,700
- - - - - 809,977
40,376$ 317,313$ 469,114$ 2,231,333$ 1,177,999$ 18,659,706$
17,490$ 651$ -$ 509,396$ 88,759$ 1,754,522$
- - - - 17,662 17,662
5,174 27,114 - 12,160 2,576 73,024
- - - - - 16,131
- - - 1,000,000 - 1,400,000
- - - 406,693 422,296 828,989
- 2,915 - 259,706 - 262,621
22,664 30,680 - 2,187,955 531,293 4,352,949
- - - 43,378 - 3,514,745
- - - - - 809,977
- 286,633 - - 646,706 6,484,128
17,712 - 469,114 - - 3,697,907
- - - - - (200,000)
17,712 286,633 469,114 - 646,706 10,792,012
40,376$ 317,313$ 469,114$ 2,231,333$ 1,177,999$ 18,659,706$
129
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended June 30, 2016
Drug Law Community
Drug Law Enforcement Development
Major Local Enforcement State and Block Grant
Streets Streets Federal Local Program
Revenues
Taxes and special assessments 111,283$ -$ -$ -$ -$
Intergovernmental 9,482,007 2,050,012 47,419 - 1,573,946
Charges for services 947,738 1,008,645 - - -
Fines and forfeits - - - 377,904 -
Interest and rents 26,710 21,343 1,657 2,409 -
Contributions - - - - -
Other revenues 175,892 - - - 383,894
Total revenues 10,743,630 3,080,000 49,076 380,313 1,957,840
Expenditures
Current expenditures:
General government - - - - -
Public safety - - - 139,216 -
Public works - - - - -
Highways and streets 5,917,314 4,921,159 - - -
Community development - - - - -
Debt service:
Principal 310,800 984,200 - - -
Interest 194,455 381,295 - - -
Capital outlay 1,193,940 1,065,796 - 178,159 2,028,374
Total expenditures 7,616,509 7,352,450 - 317,375 2,028,374
Revenues over (under)
expenditures 3,127,121 (4,272,450) 49,076 62,938 (70,534)
Other financing sources (uses)
Transfers in 72,940 4,456,950 - - 70,534
Transfers out (2,546,950) - - - -
Total other financing
sources (uses)(2,474,010) 4,456,950 - - 70,534
Net change in fund balances 653,111 184,500 49,076 62,938 -
Fund balances, beginning of year 5,688,020 2,026,243 306,811 401,148 -
Fund balances, end of year 6,341,131$ 2,210,743$ 355,887$ 464,086$ -$
CITY OF LANSING, MICHIGAN
130
State and
Downtown Building Parks Federal Tri-County
Lansing, Inc. Department Department Grants Metro Totals
396,298$ -$ -$ -$ -$ 507,581$
- - - 5,045,846 544,557 18,743,787
5,250 2,636,598 - - - 4,598,231
- - - - 242,482 620,386
405 - 2,226 - 5,099 59,849
10,000 - - - - 10,000
275,395 - - 156,714 - 991,895
687,348 2,636,598 2,226 5,202,560 792,138 25,531,729
760,399 2,359,966 - 232,502 - 3,352,867
- - - 841,428 840,095 1,820,739
- - - 891,680 - 891,680
- - - - - 10,838,473
- - - 3,442,110 - 3,442,110
- - - - - 1,295,000
- - - - - 575,750
- - - 110,769 - 4,577,038
760,399 2,359,966 - 5,518,489 840,095 26,793,657
(73,051) 276,632 2,226 (315,929) (47,957) (1,261,928)
69,380 - - 313,866 - 4,983,670
- - - (2,290) - (2,549,240)
69,380 - - 311,576 - 2,434,430
(3,671) 276,632 2,226 (4,353) (47,957) 1,172,502
21,383 10,001 466,888 4,353 694,663 9,619,510
17,712$ 286,633$ 469,114$ -$ 646,706$ 10,792,012$
131
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2016
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments 27,000$ 111,283$ 84,283$
Intergovernmental 7,472,035 9,482,007 2,009,972
Charges for services 850,000 947,738 97,738
Fines and forfeits - - -
Interest and rents - 26,710 26,710
Contributions - - -
Other revenues 92,925 175,892 82,967
Total revenues 8,441,960 10,743,630 2,301,670
Expenditures
Current expenditures:
General government - - -
Public safety - - -
Public works - - -
Highways and streets 6,302,850 5,917,314 (385,536)
Community development - - -
Debt service:
Principal 310,800 310,800 -
Interest 195,000 194,455 (545)
Capital outlay 3,294,560 1,193,940 (2,100,620)
Total expenditures 10,103,210 7,616,509 (2,486,701)
Revenues over (under) expenditures (1,661,250) 3,127,121 4,788,371
Other financing sources (uses)
Transfers in 187,977 72,940 (115,037)
Transfers out (2,546,950) (2,546,950) -
Total other financing sources (uses)(2,358,973) (2,474,010) (115,037)
Net change in fund balances (4,020,223) 653,111 4,673,334
Fund balances, beginning of year 5,688,020 5,688,020 -
Fund balances, end of year 1,667,797$ 6,341,131$ 4,673,334$
CITY OF LANSING, MICHIGAN
Major Streets
132
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
-$ -$ -$ -$ -$ -$
1,800,000 2,050,012 250,012 - 47,419 47,419
750,000 1,008,645 258,645 - - -
- - -- - -
- 21,343 21,343 - 1,657 1,657
- - - - - -
- - - - - -
2,550,000 3,080,000 530,000 -49,076 49,076
- - -- - -
- - -- - -
- - -- - -
5,020,000 4,921,159 (98,841)- - -
- - -- - -
984,200 984,200 -- - -
382,100 381,295 (805)- - -
2,294,898 1,065,796 (1,229,102)- - -
8,681,198 7,352,450 (1,328,748)---
(6,131,198) (4,272,450) 1,858,748 -49,076 49,076
4,456,950 4,456,950 -- - -
- - -- - -
4,456,950 4,456,950 ----
(1,674,248) 184,500 1,858,748 -49,076 49,076
2,026,243 2,026,243 - 306,811 306,811 -
351,995$ 2,210,743$ 1,858,748$ 306,811$ 355,887$ 49,076$
continued…
Drug Law Enforcement FederalLocal Streets
133
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2016
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments -$ -$ -$
Intergovernmental - - -
Charges for services - - -
Fines and forfeits - 377,904 377,904
Interest and rents - 2,409 2,409
Contributions - - -
Other revenues - - -
Total revenues - 380,313 380,313
Expenditures
Current expenditures:
General government - - -
Public safety 172,650 139,216 (33,434)
Public works - - -
Highways and streets - - -
Community development - - -
Debt service:
Principal - - -
Interest - - -
Capital outlay 218,000 178,159 (39,841)
Total expenditures 390,650 317,375 (73,275)
Revenues over (under) expenditures (390,650) 62,938 453,588
Other financing sources (uses)
Transfers in - - -
Transfers out - - -
Total other financing sources (uses)---
Net change in fund balances (390,650) 62,938 453,588
Fund balances, beginning of year 401,148 401,148 -
Fund balances, end of year 10,498$ 464,086$ 453,588$
CITY OF LANSING, MICHIGAN
Drug Law Enforcement State and Local
134
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
-$ -$ -$ 409,000$ 396,298$ (12,702)$
1,864,490 1,573,946 (290,544)- - -
- - -4,800 5,250 450
- - -- - -
- - -- 405 405
- - -10,000 10,000 -
550,000 383,894 (166,106) 271,610 275,395 3,785
2,414,490 1,957,840 (456,650) 695,410 687,348 (8,062)
- - - 760,200 760,399 199
- - -- - -
- - -- - -
- - -- - -
- - -- - -
- - -- - -
- - -- - -
2,414,490 2,028,374 (386,116)- - -
2,414,490 2,028,374 (386,116) 760,200 760,399 199
- (70,534) (70,534) (64,790) (73,051) (8,261)
- 70,534 70,534 69,380 69,380 -
- - - - - -
- 70,534 70,534 69,380 69,380 -
---4,590 (3,671) (8,261)
-- -21,383 21,383 -
-$ -$ -$ 25,973$ 17,712$ (8,261)$
continued…
Community Development Block Grant Program Downtown Lansing, Inc.
135
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2016
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments -$ -$ -$
Intergovernmental - - -
Charges for services 2,252,860 2,636,598 383,738
Fines and forfeits - - -
Interest and rents - - -
Contributions - - -
Other revenues - - -
Total revenues 2,252,860 2,636,598 383,738
Expenditures
Current expenditures:
General government 2,444,000 2,359,966 (84,034)
Public safety - - -
Public works - - -
Highways and streets - - -
Community development - - -
Debt service:
Principal - - -
Interest - - -
Capital outlay - - -
Total expenditures 2,444,000 2,359,966 (84,034)
Revenues over (under) expenditures (191,140) 276,632 467,772
Other financing sources (uses)
Transfers in 191,140 - (191,140)
Transfers out - - -
Total other financing sources (uses)191,140 - (191,140)
Net change in fund balances - 276,632 276,632
Fund balances, beginning of year 10,001 10,001 -
Fund balances, end of year 10,001$ 286,633$ 276,632$
CITY OF LANSING, MICHIGAN
Building Department
136
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
-$ -$ -$ -$ -$ -$
- - - 6,790,567 5,045,846 (1,744,721)
- - -- - -
- - -- - -
- 2,226 2,226 - - -
- - -- - -
- - -- 156,714 156,714
-2,226 2,226 6,790,567 5,202,560 (1,588,007)
- - - 261,815 232,502 (29,313)
- - - 961,567 841,428 (120,139)
- - -15,451 891,680 876,229
- - -- - -
- - - 4,954,478 3,442,110 (1,512,368)
- - -- - -
- - -- - -
- - - 220,814 110,769 (110,045)
41,175 - (41,175) 6,471,118 5,518,489 (952,629)
(41,175)2,226 43,401 319,448 (315,929) (635,377)
- - - 173,793 313,866 140,073
- - -- (2,290) (2,290)
--- 173,793 311,576 137,783
(41,175)2,226 43,401 493,242 (4,353) (497,595)
466,888 466,888 -4,353 4,353 -
425,713$ 469,114$ 43,401$ 497,595$ -$ (497,595)
continued…
Parks Department State and Federal Grants
137
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2016
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments -$ -$ -$
Intergovernmental 424,780 544,557 119,777
Charges for services - - -
Fines and forfeits 424,720 242,482 (182,238)
Interest and rents - 5,099 5,099
Contributions - - -
Other revenues - - -
Total revenues 849,500 792,138 (57,362)
Expenditures
Current expenditures:
General government - - -
Public safety 837,500 840,095 2,595
Public works - - -
Highways and streets - - -
Community development - - -
Debt service:
Principal - - -
Interest - - -
Capital outlay - - -
Total expenditures 837,500 840,095 2,595
Revenues over (under) expenditures 12,000 (47,957) (59,957)
Other financing sources (uses)
Transfers in - - -
Transfers out (12,000) - 12,000
Total other financing sources (uses)(12,000)-12,000
Net change in fund balances - (47,957) (47,957)
Fund balances, beginning of year 694,663 694,663 -
Fund balances, end of year 694,663$ 646,706$ (47,957)$
concluded
CITY OF LANSING, MICHIGAN
Tri-County Metro
138
CITY OF LANSING, MICHIGAN
Nonmajor Debt Service Funds
2015 Refunding Debt Service Fund – This fund accounts for the accumulation of resources for
payment of the 2015 $320,000 Refunding Building Authority Bonds.
1999 Fire Station Fund – This fund accounts for the accumulation of resources for payment of the
1999 $3,000,000 Unlimited Tax General Obligation Bonds (which was refunding in 2007 in the amont
of $1,780,000).
2001 Fire Station Fund – This fund accounts for the accumulation of resources for the payment of
the 2001 $4,000,000 Unlimited Tax General Obligation Bonds (which was refunding in 2010 in the
amont of $2,470,000).
2014 Technology Bond Fund – This fund accounts for the accumulation of resources for payment of
the 2014 $2,275,000 Limited Tax Capital Improvement Bonds issued for technology improvements.
139
Combining Balance Sheet
Nonmajor Debt Service Funds
June 30, 2016
2015
Refunding 1999 2001 2014
Debt Fire Fire Technology
Service Station Station Bond Totals
Assets
Equity in pooled cash and investments -$ 103$ 1,161$ -$ 1,264$
Accounts receivable, net 176 - - - 176
Special assessments receivable - - - - -
Due from other funds - - - - -
Total assets 176$ 103$ 1,161$ -$ 1,440$
Liabilities
Due to other funds 176$ -$ -$ -$ 176$
Fund balances
Restricted - 103 1,161 - 1,264
Total liabilities
and fund balances 176$ 103$ 1,161$ -$ 1,440$
CITY OF LANSING, MICHIGAN
140
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Debt Service Funds
For the Year Ended June 30, 2016
2015
Refunding 1999 2001 2014
Debt Fire Fire Technology
Service Station Station Bond Totals
Revenues
Taxes and special assessments -$ 235,800$ 267,277$ -$ 503,077$
Interest and rents - 103 161 - 264
Total revenues - 235,903 267,438 - 503,341
Expenditures
Debt service:
Principal 150,000 200,000 310,000 755,000 1,415,000
Interest 23,543 35,800 34,295 27,225 120,863
Total expenditures 173,543 235,800 344,295 782,225 1,535,863
Revenues over (under)
expenditures (173,543) 103 (76,857) (782,225) (1,032,522)
Other financing sources (uses)
Transfers in 173,574 - 77,018 782,225 1,032,817
Issuance of long-term debt 320,000 - - - 320,000
Bond premium 12,022 - - - 12,022
Payment to refunded bond escrow agent (332,053) - - - (332,053)
Total other financing sources (uses)173,543 - 77,018 782,225 1,032,786
Net change in fund balances - 103 161 - 264
Fund balances, beginning of year - - 1,000 - 1,000
Fund balances, end of year -$ 103$ 1,161$ -$ 1,264$
CITY OF LANSING, MICHIGAN
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142
CITY OF LANSING, MICHIGAN
Nonmajor Capital Projects Funds
1990 Environmental II Fund – This fund accounts for the proceeds of the 1990 $6,300,000
environmental bonds.
Special Assessments Fund – This fund is used to account for the financing of public improvements
deemed to benefit the properties against which special assessments are levied.
Lansing Center Improvements Fund – This fund accounts for the proceeds of the 2006 $4,000,000
Lansing Center limited tax bonds.
Other Capital Projects Fund – This fund accounts for accounts for miscellaneous capital projects.
143
Combining Balance Sheet
Nonmajor Capital Projects Funds
June 30, 2016
1990 Lansing Other
Environ- Special Center Capital
mental II Assessments Improvements Projects Totals
Assets
Equity in pooled cash and
investments 26,137$ -$ 6$ 6,421,994$ 6,448,137$
Accounts receivable, net - - - 1,202,858 1,202,858
Special assessments receivable:
Current - 48,242 - - 48,242
Deferred - 345,321 - - 345,321
Due from other funds - - - 1,404,970 1,404,970
Total assets 26,137$ 393,563$ 6$ 9,029,822$ 9,449,528$
Liabilities
Accounts payable -$ 17,185$ 6$ 1,637,598$ 1,654,789$
Due to other funds - - - 120,144 120,144
Due to component units - - - 2,119,598 2,119,598
Advance from other funds - 241,309 - - 241,309
Total liabilities - 258,494 6 3,877,340 4,135,840
Deferred inflows of resources
Unavailable revenues -
special assessments - 345,321 - - 345,321
Fund balances
Restricted 26,137 - - 423,136 449,273
Committed - - - 4,729,346 4,729,346
Unassigned (deficit) - (210,252) - - (210,252)
Total fund balances (deficit)26,137 (210,252) - 5,152,482 4,968,367
Total liabilities, deferred inflows of
resources and fund balances 26,137$ 393,563$ 6$ 9,029,822$ 9,449,528$
CITY OF LANSING, MICHIGAN
144
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Capital Projects Funds
For the Year Ended June 30, 2016
1990 Lansing Other
Environ- Special Center Capital
mental II Assessments Improvements Projects Totals
Revenues
Special assessments -$ 59,190$ -$ -$ 59,190$
Charges for services - - - 980,995 980,995
Interest and rents 132 - 13 7,377 7,522
Total revenues 132 59,190 13 988,372 1,047,707
Expenditures
Capital outlay 25,312 27,945 3,230 2,401,675 2,458,162
Revenues over
(under) expenditures (25,180) 31,245 (3,217) (1,413,303) (1,410,455)
Other financing sources (uses)
Transfers in - 86,647 - 2,695,650 2,782,297
Transfers out - - - (1,103,469) (1,103,469)
Total other financing
sources (uses)- 86,647 - 1,592,181 1,678,828
Net change in fund balances (25,180) 117,892 (3,217) 178,878 268,373
Fund balances (deficit),
beginning of year 51,317 (328,144) 3,217 4,973,604 4,699,994
Fund balances (deficit),
end of year 26,137$ (210,252)$ -$ 5,152,482$ 4,968,367$
CITY OF LANSING, MICHIGAN
145
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146
CITY OF LANSING, MICHIGAN
Nonmajor Permanent Funds
Cemetery Perpetual Care Fund – This fund accounts for transfers from the Cemetery Fund,
representing 15% of lot sales. These funds are invested, and all investment earnings are transferred
to the Cemetery Fund for lot maintenance.
Parks Trust Fund – This fund accounts for contributions made for City parks, the principal of which
must be preserved in accordance with the trust indentures. Income derived from these
contributions is transferred to the Parks Department special revenue fund.
147
Combining Balance Sheet
Nonmajor Permanent Funds
June 30, 2016
Cemetery
Perpetual Parks
Care Trust Totals
Assets
Equity in pooled cash and investments 59,880$ 1,253$ 61,133$
Investments 1,700,000 - 1,700,000
Accrued interest receivable 7,221 - 7,221
Total assets 1,767,101$ 1,253$ 1,768,354$
Fund balances
Nonspendable 1,767,101$ 1,253$ 1,768,354$
CITY OF LANSING, MICHIGAN
148
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Permanent Funds
For the Year Ended June 30, 2016
Cemetery
Perpetual Parks
Care Trust Totals
Revenues
Interest and rents 7,435$ 2$ 7,437$
Other financing sources (uses)
Transfers in 21,782 - 21,782
Transfers out (7,347) - (7,347)
Total other financing sources (uses)14,435 - 14,435
Net change in fund balances 21,870 2 21,872
Fund balances, beginning of year 1,745,231 1,251 1,746,482
Fund balances, end of year 1,767,101$ 1,253$ 1,768,354$
CITY OF LANSING, MICHIGAN
149
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150
CITY OF LANSING, MICHIGAN
Nonmajor Enterprise Funds
Cemetery Fund – This fund accounts for the operation of City-owned cemeteries.
Golf Fund – This fund accounts for the operation of the City-owned golf courses.
Garbage and Rubbish Collection Fund – This fund accounts for the provision of household solid
waste disposal services to participating residents of the City.
Recycling Fund – This fund accounts for the provision of recycling services to participating residents
of the City.
151
Combining Statement of Net Position
Nonmajor Enterprise Funds
June 30, 2016
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Assets
Current assets:
Cash and cash equivalents 200$ 747$ -$ -$ 947$
Equity in pooled cash and investments 316,300 116,782 36,112 1,342,489 1,811,683
Accounts receivable, net - 912 74,675 9,090 84,677
Inventories 48,862 4,023 10,579 - 63,464
Total current assets 365,362 122,464 121,366 1,351,579 1,960,771
Noncurrent assets:
Capital assets not being depreciated 57,740 446,501 - - 504,241
Capital assets being depreciated, net 117,573 1,971,098 - 1,053,543 3,142,214
Total noncurrent assets 175,313 2,417,599 - 1,053,543 3,646,455
Total assets 540,675 2,540,063 121,366 2,405,122 5,607,226
Deferred outflows of resources
Deferred charge on refunding - 2,297 - - 2,297
Deferred pension amounts 172,423 181,950 418,797 682,848 1,456,018
Total deferred outflows of resources 172,423 184,247 418,797 682,848 1,458,315
Liabilities
Current liabilities:
Accounts payable 48,515 12,914 46,254 47,447 155,130
Accrued interest payable - 210 - 6,109 6,319
Accrued payroll 3,099 21,324 - - 24,423
Due to other funds - 2,297 - - 2,297
Unearned revenues - 21,554 84,732 - 106,286
Current portion of:
Bonds and notes payable - 105,000 - 216,950 321,950
Total current liabilities 51,614 163,299 130,986 270,506 616,405
Noncurrent liabilities:
Bonds and notes payable, net
of current portion - - - 1,029,723 1,029,723
Compensated absences, net
of current portion 20,683 30,737 76,477 124,250 252,147
Net pension liability 1,180,064 1,245,263 2,866,244 4,673,402 9,964,973
Total noncurrent liabilities 1,200,747 1,276,000 2,942,721 5,827,375 11,246,843
Total liabilities 1,252,361 1,439,299 3,073,707 6,097,881 11,863,248
Deferred inflows of resources
Deferred pension amounts 39,900 42,104 96,912 158,014 336,930
Net position
Net investment in capital assets 175,313 2,314,896 - (193,130) 2,297,079
Unrestricted (deficit) (754,476) (1,071,989) (2,630,456) (2,974,795) (7,431,716)
Total net position (579,163)$ 1,242,907$ (2,630,456)$ (3,167,925)$ (5,134,637)$
CITY OF LANSING, MICHIGAN
152
Combining Statement of Revenues, Expenses and Changes in Fund Net Position
Nonmajor Enterprise Funds
For the Year Ended June 30, 2016
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Operating revenues
Charges for services 312,929$ 313,164$ 1,871,665$ 3,627,070$ 6,124,828$
Operating expenses
Personal services 407,255 516,021 1,098,242 2,226,561 4,248,079
Purchase of goods and services 288,882 256,252 987,486 1,323,694 2,856,314
Depreciation 12,408 66,085 - 301,012 379,505
Total operating expenses 708,545 838,358 2,085,728 3,851,267 7,483,898
Operating loss (395,616) (525,194) (214,063) (224,197) (1,359,070)
Nonoperating revenues (expenses)
Interest revenue - - 4,016 14,320 18,336
Interest expense and fees - (7,217) - (26,525) (33,742)
Capital contribution to others - - - (214,486) (214,486)
Total nonoperating revenues
(expenses)- (7,217) 4,016 (226,691) (229,892)
Loss before transfers (395,616) (532,411) (210,047) (450,888) (1,588,962)
Transfers in 433,147 518,350 - - 951,497
Transfers out (21,782) - - - (21,782)
Change in net position 15,749 (14,061) (210,047) (450,888) (659,247)
Net position, beginning of year (594,912) 1,256,968 (2,420,409) (2,717,037) (4,475,390)
Net position, end of year (579,163)$ 1,242,907$ (2,630,456)$ (3,167,925)$ (5,134,637)$
CITY OF LANSING, MICHIGAN
153
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended June 30, 2016
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Cash flows from operating activities
Cash received from customers 312,929$ 300,303$ 1,789,848$ 3,619,445$ 6,022,525$
Cash payments for goods and services (259,153) (255,863) (1,015,449) (1,331,502) (2,861,967)
Cash payments to employees (369,394) (473,746) (1,008,967) (2,081,031) (3,933,138)
Net cash provided by
(used in) operating activities (315,618) (429,306) (234,568) 206,912 (772,580)
Cash flows from noncapital
financing activities
Transfers in 433,147 518,350 - - 951,497
Transfers out (21,782) - - - (21,782)
Net cash provided by
noncapital financing activities 411,365 518,350 - - 929,715
Cash flows from capital and related
financing activities
Capital contributions to others - - - (214,486) (214,486)
Principal paid on long-term debt - (100,000) - (212,758) (312,758)
Interest paid on long-term debt - (4,920) - (27,567) (32,487)
Net cash used in capital and related
financing activities - (104,920) - (454,811) (559,731)
Cash flows from investing activities
Interest and dividends received - - 4,016 14,320 18,336
Net change in cash and cash equivalents 95,747 (15,876) (230,552) (233,579) (384,260)
Cash and cash equivalents,
beginning of year 220,753 133,405 266,664 1,576,068 2,196,890
Cash and cash equivalents,
end of year 316,500$ 117,529$ 36,112$ 1,342,489$ 1,812,630$
Reconciliation to statement of net position
Cash and cash equivalents 200$ 747$ -$ -$ 947$
Equity in pooled cash and investments 316,300 116,782 36,112 1,342,489 1,811,683
316,500$ 117,529$ 36,112$ 1,342,489$ 1,812,630$
continued…
CITY OF LANSING, MICHIGAN
154
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended June 30, 2016
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
CITY OF LANSING, MICHIGAN
Reconciliation of operating loss
to net cash provided by (used in)
operating activities
Operating loss (395,616)$ (525,194)$ (214,063)$ (224,197)$ (1,359,070)$
Adjustments to reconcile operating
loss to net cash provided by (used in)
operating activities:
Depreciation expense 12,408 66,085 - 301,012 379,505
Changes in:
Accounts receivable - 1,415 (12,510) (7,625) (18,720)
Inventories 6,411 179 29,993 - 36,583
Accounts payable 23,318 3,184 42,044 (7,808) 60,738
Deposits payable - - (4,140) - (4,140)
Accrued payroll 1,903 3,867 - - 5,770
Due to other funds - (2,974) (100,000) - (102,974)
Unearned revenues - (14,276) (65,167) - (79,443)
Compensated absences 1,529 2,079 5,654 9,187 18,449
Net pension liability and related
deferred amounts 34,429 36,329 83,621 136,343 290,722
Net cash provided by
(used in) operating activities (315,618)$ (429,306)$ (234,568)$ 206,912$ (772,580)$
concluded
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156
CITY OF LANSING, MICHIGAN
Internal Service Funds
Fleet Maintenance Fund – This fund accounts for the costs of maintaining the City’s fleet of
vehicles and heavy equipment.
Fringe Benefits Fund – This fund accounts for the costs of the City’s fringe benefits.
Engineering Fund – This fund accounts for the operations of the City’s engineering department.
Information Technology Fund – This fund accounts for the operations of the City’s information
technology department.
157
Combining Statement of Net Position
Internal Service Funds
June 30, 2016
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Assets
Current assets:
Cash and cash equivalents 57,842$ -$ -$ -$ 57,842$
Equity in pooled cash and investments 2,463,949 1,871,604 594,560 1,055,187 5,985,300
Accounts receivable, net - 580,255 -- 580,255
Inventories 374,891 --- 374,891
Prepaids - 356,370 -6,242 362,612
Total current assets 2,896,682 2,808,229 594,560 1,061,429 7,360,900
Noncurrent assets:
Capital assets not being
depreciated 92,892 ---92,892
Capital assets being depreciated,
net 10,594,558 - 1,606,336 - 12,200,894
Total noncurrent assets 10,687,450 - 1,606,336 - 12,293,786
Total assets 13,584,132 2,808,229 2,200,896 1,061,429 19,654,686
Liabilities
Current liabilities:
Accounts payable 301,983 402,535 36,113 35,217 775,848
Accrued interest payable 33,488 ---33,488
Accrued payroll 60,233 7,232 47,539 20,208 135,212
Claims incurred but not reported - 656,064 -- 656,064
Current portion of:
Bonds and notes payable 893,799 --- 893,799
Compensated absences 37,591 ---37,591
Total current liabilities 1,327,094 1,065,831 83,652 55,425 2,532,002
Noncurrent liabilities:
Bonds and notes payable,
net of current portion 3,861,359 --- 3,861,359
Compensated absences,
net of current portion 169,822 46,693 421,593 112,455 750,563
Total noncurrent liabilities 4,031,181 46,693 421,593 112,455 4,611,922
Total liabilities 5,358,275 1,112,524 505,245 167,880 7,143,924
Net position
Net investment in capital assets 5,932,292 - 1,606,336 - 7,538,628
Unrestricted 2,293,565 1,695,705 89,315 893,549 4,972,134
Total net position 8,225,857$ 1,695,705$ 1,695,651$ 893,549$ 12,510,762$
CITY OF LANSING, MICHIGAN
158
Combining Statement of Revenues, Expenses and Changes in Fund Net Position
Internal Service Funds
For the Year Ended June 30, 2016
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Operating revenues
Charges for services 9,746,085$ 60,804,769$ 4,136,645$ 4,359,922$ 79,047,421$
Operating expenses
Personal services 3,314,682 270,451 3,019,391 1,214,581 7,819,105
Purchase of goods and services 3,520,367 59,673,534 903,022 1,852,599 65,949,522
Depreciation 1,998,357 - 45,430 - 2,043,787
Total operating expenses 8,833,406 59,943,985 3,967,843 3,067,180 75,812,414
Operating income 912,679 860,784 168,802 1,292,742 3,235,007
Nonoperating revenues (expenses)
Gain on sale of capital assets 63,079 - - - 63,079
Interest expense and fees (168,672) - (6,849) - (175,521)
Capital contribution to others - - (181,638) - (181,638)
Total nonoperating revenues
(expenses)(105,593) - (188,487) - (294,080)
Income (loss) before transfers 807,086 860,784 (19,685) 1,292,742 2,940,927
Transfers
Transfers in 1,000,000 - - - 1,000,000
Transfers out - - - (782,225) (782,225)
Total transfers 1,000,000 - - (782,225) 217,775
Change in net position 1,807,086 860,784 (19,685) 510,517 3,158,702
Net position, beginning of year 6,418,771 834,921 1,715,336 383,032 9,352,060
Net position, end of year 8,225,857$ 1,695,705$ 1,695,651$ 893,549$ 12,510,762$
CITY OF LANSING, MICHIGAN
159
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2016
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Cash flows from operating activities
Cash received from interfund
services 9,746,085$ 61,086,384$ 4,136,645$ 4,359,922$ 79,329,036$
Cash payments for goods
and services (3,773,980) (59,550,269) (869,766) (2,375,004) (66,569,019)
Cash payments to employees (3,284,713) (315,812) (3,015,516) (1,241,401) (7,857,442)
Net cash provided by operating activities 2,687,392 1,220,303 251,363 743,517 4,902,575
Cash flows from noncapital
financing activities
Transfers in 1,000,000 - - - 1,000,000
Transfers out - - - (782,225) (782,225)
Net cash provided by (used in)
noncapital financing activities 1,000,000 - - (782,225) 217,775
Cash flows from capital and related
financing activities
Proceeds on sale of capital assets 63,079 - - - 63,079
Acquisition and construction of
capital assets (1,281,850) - (181,638) - (1,463,488)
Principal paid on long-term debt (871,148) - (155,000) - (1,026,148)
Interest paid on long-term debt (173,912) - (3,720) - (177,632)
Net cash used in capital and related
financing activities (2,263,831) - (340,358) - (2,604,189)
Net change in cash and cash equivalents 1,423,561 1,220,303 (88,995) (38,708) 2,516,161
Cash and cash equivalents,
beginning of year 1,098,230 651,301 683,555 1,093,895 3,526,981
Cash and cash equivalents,
end of year 2,521,791$ 1,871,604$ 594,560$ 1,055,187$ 6,043,142$
Reconciliation to statement of net position
Cash and cash equivalents 57,842$ -$ -$ -$ 57,842$
Equity in pooled cash and investments 2,463,949 1,871,604 594,560 1,055,187 5,985,300
2,521,791$ 1,871,604$ 594,560$ 1,055,187$ 6,043,142$
continued…
CITY OF LANSING, MICHIGAN
160
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2016
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
CITY OF LANSING, MICHIGAN
Reconciliation of operating income to net
cash provided by operating activities
Operating income 912,679$ 860,784$ 168,802$ 1,292,742$ 3,235,007$
Adjustments to reconcile operating
income to net cash provided
by operating activities:
Depreciation expense 1,998,357 - 45,430 - 2,043,787
Change in:
Accounts receivable - 281,615 - - 281,615
Inventories 52,993 - - - 52,993
Prepaids - 49,874 - (6,242) 43,632
Accounts payable 193,394 73,391 33,256 (316,163) (16,122)
Accrued payroll 11,051 1,526 11,260 5,840 29,677
Claims incurred but not reported
reported - (48,841) - - (48,841)
Due to other funds (500,000) - - (200,000) (700,000)
Compensated absences 18,918 1,954 (7,385) (32,660) (19,173)
Net cash provided by operating activities 2,687,392$ 1,220,303$ 251,363$ 743,517$ 4,902,575$
concluded
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162
CITY OF LANSING, MICHIGAN
Agency Funds
Bail Bonds Fund – This fund is used to hold cash received by the District Court for bail bonds.
Garnishment, Indemnity Bond and Restitution Fund – This fund is used to hold cash received by the
District Court for garnishment payments until claimed, and to hold indemnity bonds deposited
relating to civil disputes until the Court rules on the case.
163
Combining Statement of Fiduciary Assets and Liabilities
Agency Funds
June 30, 2016
Garnishment,
Bail Indemnity Bond
Bonds and Restitution Totals
Assets
Equity in pooled cash and investments 63,498$ 4,240$ 67,738$
Liabilities
Undistributed receipts 63,498$ 4,240$ 67,738$
CITY OF LANSING, MICHIGAN
54-A District Court
164
Combining Statement of Changes in Fiduciary Assets and Liabilities
Agency Funds
For the Year Ended June 30, 2016
Beginning Ending
Balance Additions Deletions Balance
54-A District Court - Bail Bonds
Assets
Equity in pooled cash and investments 58,364$ 498,111$ 492,977$ 63,498$
Liabilities
Undistributed receipts 58,364$ 498,111$ 492,977$ 63,498$
54-A District Court - Garnishment,
Indemnity Bond and Restitution
Assets
Equity in pooled cash and investments 10,943$ 206,457$ 213,160$ 4,240$
Liabilities
Undistributed receipts 10,943$ 206,457$ 213,160$ 4,240$
Total - all agency funds
Assets
Equity in pooled cash and investments 69,307$ 704,568$ 706,137$ 67,738$
Liabilities
Undistributed receipts 69,307$ 704,568$ 706,137$ 67,738$
CITY OF LANSING, MICHIGAN
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166
STATISTICAL SECTION
167
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168
CITY OF LANSING, MICHIGAN
Statistical Section Table of Contents
Page
Financial Trends
(Tables 1-4)
These schedules contain trend information to help the reader
understand how the City’s financial performance and well-being
have changed over time.171
Revenue Capacity
(Tables 5-8)
These schedules contain information to help the reader assess
the factors affecting the City’s ability to generate its property
taxes.176
Debt Capacity
(Tables 9-13)
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.180
Demographic and
Economic Information
(Tables 14-15)
These schedules offer demographic and economic indicators to
help the reader understand the environment within which the
City’s financial activities take place and to help make
comparisons over time and with other governments.185
Operating Information
(Tables 16-18)
These schedules contain information about the City’s operations
and resources to help the reader understand how the City’s
financial information relates to the services the City provides and
the activities it performs.188
This part of the City of Lansing, Michigan’s (the "City") comprehensive annual financial report presents
detailed information as a context for understanding what the information in the financial statements,
note disclosures, and required supplementary information says about the City’s overall financial health.
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year.
169
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170
Table 1 - Unaudited
Net Position by Component
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Governmental activities
Net investment in capital assets 149,676,860$ 151,785,916$ 150,976,010$ 154,372,604$ 163,723,249$ 180,571,237$ 186,536,428$ 191,516,475$ 187,054,852$ 184,150,439$
Restricted 12,922,525 12,311,541 13,133,137 12,552,011 14,524,584 14,777,571 14,304,689 17,139,090 34,554,539 37,642,784
Unrestricted (deficit) (265,678,371) (251,453,207) (46,344,555) (39,467,672) (34,371,855) (18,840,717) (7,649,432) 6,589,790 (3,124,027) 2,776,006
Total governmental activities net position (103,078,986)$ (87,355,750)$ 117,764,592$ 127,456,943$ 143,875,978$ 176,508,091$ 193,191,685$ 215,245,355$ 218,485,364$ 224,569,229$
Business-type activities
Net investment in capital assets 220,436,882$ 218,813,478$ 214,458,841$ 212,682,278$ 209,584,457$ 204,149,751$ 194,854,140$ 185,430,669$ 178,526,049$ 166,320,408$
Restricted 2,764,963 2,889,096 8,746,096 11,077,134 12,382,060 13,080,302 19,917,341 19,454,812 30,892,739 35,777,715
Unrestricted 19,401,320 17,242,167 37,891,053 31,943,581 32,196,598 34,177,453 30,193,568 23,730,694 16,330,517 28,929,677
Total business-type activities net position 242,603,165$ 238,944,741$ 261,095,990$ 255,702,993$ 254,163,115$ 251,407,506$ 244,965,049$ 228,616,175$ 225,749,305$ 231,027,800$
Primary government
Net investment in capital assets 370,113,742$ 370,599,394$ 365,434,851$ 367,054,882$ 373,307,706$ 384,720,988$ 381,390,568$ 376,947,144$ 365,580,901$ 350,470,847$
Restricted 15,687,488 15,200,637 21,879,233 23,629,145 26,906,644 27,857,873 34,222,030 36,593,902 65,447,278 73,420,499
Unrestricted (deficit) (246,277,051) (234,211,040) (8,453,502) (7,524,091) (2,175,257) 15,336,736 22,544,136 30,320,484 13,206,490 31,705,683
Total primary government net position 139,524,179$ 151,588,991$ 378,860,582$ 383,159,936$ 398,039,093$ 427,915,597$ 438,156,734$ 443,861,530$ 444,234,669$ 455,597,029$
Note: No discretely presented component units shown
(1) GASB Statement No. 68 was implemented for the fiscal year ended June 30, 2015. This resulted in presentation of the City's net pension liability on the statement of net position. Prior years were not restated.
CITY OF LANSING, MICHIGAN
(1
171
Table 2 - Unaudited
Change in Net Position
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Expenses
Governmental activities:
General government 27,993,414$ 25,225,893$ 24,771,054$ 27,438,065$ 30,841,776$ 25,665,269$ 30,326,671$ 26,426,242$ 28,901,548$ 22,043,283$
Public safety 85,739,408 81,827,437 78,142,897 77,133,469 82,369,004 83,546,997 84,566,215 71,236,947 76,211,756 62,570,888
Public works 28,212,049 27,815,970 37,243,516 29,984,955 33,144,303 26,355,375 29,252,516 37,588,680 40,032,746 40,517,063
Recreation and culture 10,336,168 6,515,590 8,670,918 7,713,098 8,889,142 8,245,451 7,312,480 7,298,385 7,677,083 6,198,462
Community development 10,642,102 10,270,404 7,602,229 16,939,572 13,623,946 12,825,028 9,715,087 6,378,286 6,382,336 6,232,406
Interest on long-term debt 1,424,215 1,291,846 1,340,818 1,475,051 1,949,825 2,116,535 2,229,288 1,803,125 1,481,658 1,658,708
Total governmental activities expenses 164,347,356 152,947,140 157,771,432 160,684,210 170,817,996 158,754,655 163,402,257 150,731,665 160,687,127 139,220,810
Business-type activities:
Sewage disposal system 28,487,957 27,506,843 28,682,809 26,298,964 26,836,597 26,444,741 24,931,075 26,247,188 27,382,736 24,725,229
Municipal parking system 7,651,077 7,605,461 7,851,702 8,108,373 9,491,376 9,896,498 8,305,095 8,353,063 10,188,065 10,275,379
Cemetery 708,545 632,485 722,270 633,050 639,000 755,766 659,584 689,979 675,672 692,510
Golf 845,575 852,634 935,671 892,117 810,372 846,817 869,003 927,200 1,072,505 1,358,008
Garbage and rubbish collection 2,085,728 1,712,671 1,722,843 1,557,708 1,558,024 1,515,600 1,451,059 1,547,372 1,436,642 1,372,266
Recycling 4,092,278 3,623,276 3,263,553 3,650,292 3,041,328 2,809,353 2,804,047 3,008,750 2,940,366 2,777,068
Potter Park Zoo - - - - - - - - (156,270) 2,968,236
Total business-type activities expenses 43,871,160 41,933,370 43,178,848 41,140,504 42,376,697 42,268,775 39,019,863 40,773,552 43,539,716 44,168,696
Total primary government expenses 208,218,516 194,880,510 200,950,280 201,824,714 213,194,693 201,023,430 202,422,120 191,505,217 204,226,843 183,389,506
Program revenues
Governmental activities:
Charges for services:
General government 7,279,427 6,815,975 6,820,261 6,162,713 6,428,110 6,742,306 6,565,263 5,188,510 5,938,911 6,251,032
Public safety 2,909,054 3,344,183 2,122,023 4,083,222 8,525,524 8,975,173 8,589,146 9,817,421 12,705,181 13,014,934
Public works 3,011,894 1,923,303 2,129,126 1,622,738 2,797,443 2,449,606 2,788,112 4,565,013 4,364,525 3,805,739
Recreation and culture 673,840 619,834 800,293 594,349 557,609 685,120 587,906 1,217,445 1,556,260 1,259,373
Community development 67,272 67,264 67,323 67,349 67,344 122,326 69,250 50,132 66,308 66,161
Operating grants and contributions 24,561,960 24,658,955 28,234,803 29,322,435 31,928,983 30,154,681 27,515,892 26,462,211 20,356,292 16,524,178
Capital grants and contributions 904,298 2,910,660 3,365,682 3,124,288 260,656 189,414 3,109,410 2,571,741 2,531,974 2,179,870
Total governmental activities program revenues 39,407,745 40,340,174 43,539,511 44,977,094 50,565,669 49,318,626 49,224,979 49,872,473 47,519,451 43,101,287
Business-type activities:
Charges for services:
Sewage disposal system 32,368,491 31,730,416 31,759,698 30,825,174 29,915,799 29,205,945 28,907,772 27,446,304 28,023,322 26,926,202
Municipal parking system 7,090,335 6,988,879 7,453,476 5,267,627 6,858,606 7,539,179 7,396,219 7,539,611 10,090,566 10,838,270
Cemetery 312,929 335,379 289,565 314,913 240,394 225,947 226,973 248,314 218,688 264,255
Golf 313,164 363,559 366,567 373,000 390,134 382,546 438,315 448,067 607,922 754,995
Garbage and rubbish collection 1,871,665 1,744,999 1,664,201 1,131,659 1,459,101 1,507,577 1,677,428 1,486,531 1,617,717 1,378,562
Recycling 3,627,070 3,624,671 3,508,536 3,434,622 2,818,364 2,609,423 2,651,309 2,945,061 3,039,089 2,903,092
Potter Park Zoo - - - - - - - - (115) 553,999
Operating grants and contributions 1,312,362 1,143,085 2,574,949 1,193,571 1,331,737 4,456,708 1,535,907 1,541,913 - -
Capital grants and contributions - - - - 2,683,657 1,439,044 11,928,108 60,318 196,317 183,012
Total business-type activities program revenues 46,896,016 45,930,988 47,616,992 42,540,566 45,697,792 47,366,369 54,762,031 41,716,119 43,793,506 43,802,387
Total primary government program revenues 86,303,761 86,271,162 91,156,503 87,517,660 96,263,461 96,684,995 103,987,010 91,588,592 91,312,957 86,903,674
Net (expenses) revenues
Governmental activities (124,939,611) (112,606,966) (114,231,921) (115,707,116) (120,252,327) (109,436,029) (114,177,278) (100,859,192) (113,167,676) (96,119,523)
Business-type activities 3,024,856 3,997,618 4,438,144 1,400,062 3,321,095 5,097,594 15,742,168 942,567 253,790 (366,309)
Total primary government net expense (121,914,755) (108,609,348) (109,793,777) (114,307,054) (116,931,232) (104,338,435) (98,435,110) (99,916,625) (112,913,886) (96,485,832)
CITY OF LANSING, MICHIGAN
172
Change in Net Position
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
General revenues and other changes in net position
Governmental activities:
Taxes:
Property taxes 38,578,548$ 39,657,382$ 38,079,548$ 38,668,837$ 33,506,860$ 37,233,590$ 39,010,960$ 39,141,928$ 38,607,761$ 38,371,105$
Income taxes 34,573,130 31,660,923 31,450,913 29,850,755 27,943,070 28,699,749 27,408,443 29,312,762 31,168,012 28,209,913
Unrestricted grants and contributions 36,532,275 36,330,976 35,677,910 31,425,718 26,441,961 27,254,574 25,847,423 27,318,313 28,180,799 27,258,536
Investment earnings 99,058 26,353 36,836 58,588 69,265 89,735 246,495 978,034 1,706,572 2,483,162
Miscellaneous 63,079 280,280 - - 123,066 108,601 75,094 32,310 - -
Transfers (629,715) (644,485) (705,637) (583,117) (464,008) (633,814) (464,807) (509,728) 7,420,667 (3,098,357)
Total governmental activities 109,216,375 107,311,429 104,539,570 99,420,781 87,620,214 92,752,435 92,123,608 96,273,619 107,083,811 93,224,359
Business-type activities:
Investment earnings - 17,874 246,616 356,467 271,067 689,883 141,899 413,850 1,883,034 2,815,480
Miscellaneous 3,853 - 2,600 - (1,300,561) 21,166 - 725 5,348 2,160
Transfers 629,715 644,485 705,637 583,117 464,008 633,814 464,807 509,728 (7,420,667) 3,098,357
Total business-type activities 633,568 662,359 954,853 939,584 (565,486) 1,344,863 606,706 924,303 (5,532,285) 5,915,997
Total primary government 109,849,943 107,973,788 105,494,423 100,360,365 87,054,728 94,097,298 92,730,314 97,197,922 101,551,526 99,140,356
Changes in net position
Governmental activities (15,723,236)$ (5,295,537)$ (9,692,351)$ (16,286,335)$ (32,632,113)$ (16,683,594)$ (22,053,670)$ (4,585,573)$ (6,083,865)$ (2,895,164)$
Business-type activities 3,658,424 4,659,977 5,392,997 2,339,646 2,755,609 6,442,457 16,348,874 1,866,870 (5,278,495) 5,549,688
Total primary government (12,064,812)$ (635,560)$ (4,299,354)$ (13,946,689)$ (29,876,504)$ (10,241,137)$ (5,704,796)$ (2,718,703)$ (11,362,360)$ 2,654,524$
Note: No discretely presented component units shown
CITY OF LANSING, MICHIGAN
173
CITY OF LANSING, MICHIGAN Table 3 - Unaudited
Fund Balances, Governmental Funds
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
General fund
Nonspendable 492,549$ 35,424$ 75,738$ 75,738$ 92,538$ 171,586$ -$ -$ -$ -$
Restricted - 10,044 9,400 9,400 16,256 41,129
Committed 428,106 837,761 2,976,408 2,976,408 65,373 178,081
Unassigned 12,407,748 9,783,911 5,633,528 5,633,528 5,198,032 4,939,691 - - - -
Reserved - - - - - - 102,732 1,320,375 1,765,288 1,848,021
Unreserved - - - - - - 389,061 3,755,862 5,465,164 5,036,129
Total general fund 13,328,403 10,667,140 8,695,074 8,695,074 5,372,199 5,330,487 491,793 5,076,237 7,230,452 6,884,150
All other governmental funds
Nonspendable 2,578,331 2,619,065 2,671,151 2,671,151 2,852,004 3,006,507 - - - -
Restricted 6,934,665 6,865,580 4,368,983 4,368,983 5,566,421 7,412,008 - - - -
Committed 8,427,253 7,110,485 4,035,145 4,035,145 4,109,131 4,908,740 - - - -
Unassigned (deficit) (410,252) (528,144) (619,931) (619,931) (543,774) (371,285) - - - -
Reserved - - - - - - 1,177,998 324,366 365,351 2,544,339
Unreserved, reported in:
Special revenue funds - - - - - - 12,029,680 13,394,485 14,716,755 14,523,146
Capital projects funds - - - - - - 11,614,644 12,010,219 17,862,441 18,978,360
Debt service funds - - - - - - 126,434 186,636 256,144 144,518
Permanent funds - - - - - - 1,649,550 1,630,098 1,609,992 1,596,939
Total all other governmental funds 17,529,997 16,066,986 10,455,348 10,455,348 11,983,782 14,955,970 26,598,306 27,545,804 34,810,683 37,787,302
Total all governmental funds 30,858,400$ 26,734,126$ 19,150,422$ 19,150,422$ 17,355,981$ 20,286,457$ 27,090,099$ 32,622,041$ 42,041,135$ 44,671,452$
(1) The City implemented GASB 54 for the Fiscal Year Ended June 30, 2011. Prior years were not restated retroactively.
(1
174
Table 4 - Unaudited
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Revenues
Taxes and special assessments 38,782,759$ 39,470,249$ 38,717,552$ 38,717,552$ 33,583,448$ 37,371,885$ 39,279,343$ 39,258,893$ 38,775,722$ 38,681,928$
Income taxes 34,573,130 31,660,923 29,850,755 29,850,755 27,943,070 28,699,749 27,408,443 29,312,762 31,168,012 28,209,913
Licenses and permits 1,559,638 1,551,125 1,509,402 1,509,402 1,538,325 1,598,804 1,414,906 1,325,119 1,429,075 1,101,550
Intergovernmental 34,175,112 36,042,377 40,639,183 40,639,183 41,431,793 40,304,785 39,137,217 38,998,039 38,556,616 34,699,908
Charges for services 14,102,447 12,900,490 11,754,381 11,754,381 18,676,398 18,606,304 18,323,158 20,355,642 19,116,593 18,415,612
Fines and forfeits 3,455,541 3,075,427 3,694,351 3,694,351 2,884,328 3,325,728 4,579,175 4,143,000 4,090,397 4,349,642
Interest and rents 145,011 87,035 53,179 53,179 63,571 88,516 249,464 1,196,559 1,836,485 2,607,388
Contributions 21,663,690 21,561,449 16,247,403 16,247,403 12,369,733 11,821,388 10,606,368 10,372,056 10,894,573 9,980,854
Donations from private sources - - - - 5,000 - 9,000 44,000 326,768 114,954
Other revenue 1,190,624 1,601,497 510,515 510,515 400,074 504,856 473,123 1,054,209 331,248 1,019,476
Total revenues 149,647,952 147,950,572 142,976,721 142,976,721 138,895,740 142,322,015 141,480,197 146,060,279 146,525,489 139,181,225
Expenditures
General government 23,386,445 21,720,206 23,595,321 23,595,321 25,038,589 26,396,516 27,839,564 28,951,805 29,209,458 28,905,058
Public safety 72,264,468 75,510,743 63,943,082 63,943,082 66,161,872 70,397,235 70,820,184 70,082,462 67,715,160 65,218,515
Public works 11,715,510 13,273,332 8,908,673 8,908,673 6,225,177 6,002,823
Highways and streets 10,838,473 10,357,488 9,937,423 9,937,423 8,589,298 8,494,233 14,506,982 14,723,311 14,860,390 13,501,747
Recreation and culture 7,719,906 7,583,085 6,629,453 6,629,453 6,996,562 7,464,193 8,127,700 8,452,768 8,038,290 7,676,600
Community development 3,442,110 3,910,924 - - - - - - - -
Other functions 2,927,391 2,704,982 23,699,202 23,699,202 17,999,264 15,675,003 15,182,675 12,599,072 11,805,843 9,847,925
Capital outlay 7,221,346 21,016,808 5,489,617 5,489,617 6,466,084 9,956,103 14,781,728 14,855,863 16,228,127 20,001,659
Debt service:
Interest 1,275,957 931,079 1,378,856 1,378,856 1,836,218 3,210,220 3,270,068 1,801,394 1,607,703 1,285,436
Principal 3,892,862 3,616,297 3,137,159 3,137,159 3,448,080 2,070,552 2,165,237 4,743,146 4,721,581 3,875,909
Issuance costs - - 42,744 42,744 - 48,804 - - - -
Total expenditures 144,684,468 160,624,944 146,761,530 146,761,530 142,761,144 149,715,682 156,694,138 156,209,821 154,186,552 150,312,849
Excess of revenues over (under) expenditures 4,963,484 (12,674,372) (3,784,809) (3,784,809) (3,865,404) (7,393,667) (15,213,941) (10,149,542) (7,661,063) (11,131,624)
Other financing sources (uses)
Proceeds from borrowing 2,090,000 16,761,300 11,932,046 11,932,046 - 2,470,000 10,146,117 - 4,052,979 15,190,077
Proceeds from sale of capital assets 268 110,533 497,833 497,833 1,398,936 1,210,046 689 1,587,216 - -
Payment to escrow agent (2,162,163) - (6,015,112) (6,015,112) - (2,456,207) - - - -
Insurance proceeds - - - - - - - 120,960 - -
Transfers in 9,207,856 9,734,572 7,056,932 7,056,932 7,893,879 9,602,095 16,181,590 11,601,871 13,507,521 6,908,259
Transfers out (10,055,346) (10,002,772) (1,892,449) (1,892,449) (8,357,887) (10,235,909) (16,646,397) (12,579,599) (12,529,754) (10,168,616)
Bond premium 80,175 40,945 - - - - - - - -
Total other financing sources (uses)(839,210) 16,644,578 11,579,250 11,579,250 934,928 590,025 9,681,999 730,448 5,030,746 11,929,720
Net change in fund balance 4,124,274$ 3,970,206$ 7,794,441$ 7,794,441$ (2,930,476)$ (6,803,642)$ (5,531,942)$ (9,419,094)$ (2,630,317)$ 798,096$
Debt service as a percentage of
noncapital expenditures 3.7%3.2%3.2%3.2%3.8%3.7%3.9%4.5%4.6%4.0%
CITY OF LANSING, MICHIGAN
175
Table 5 - Unaudited
Assessed and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
Total Assessed
Personal Total Taxable Direct Estimated Value as a
Residential Commercial Industrial Agricultural Developmental Property Assessed Tax Actual Percentage of
Property Property Property Property Property Valuation Valuation Rate Value Actual Value
2007 1,354,989,247$ 728,343,561$ 195,703,073$ -$ -$ 221,858,408$ 2,500,894,289$ 15.88 5,001,788,578$ 50.0%
2008 1,437,051,392 765,233,437 192,915,386 - - 223,995,750 2,619,195,965 15.83 5,238,391,930 50.0%
2009 1,479,089,611 719,463,319 254,539,254 - - 205,034,000 2,658,126,184 15.83 5,316,252,368 50.0%
2010 1,480,467,389 713,807,797 248,288,931 - - 220,228,175 2,662,792,292 15.70 5,325,584,584 50.0%
2011 1,407,920,589 624,406,132 215,099,428 - - 199,543,400 2,446,969,549 15.70 4,893,939,098 50.0%
2012 1,387,390,250 639,535,400 87,432,000 - - 183,233,681 2,297,591,331 15.70 4,595,182,662 50.0%
2013 1,232,109,181 587,002,900 86,884,400 151,900 - 182,543,900 2,088,692,281 19.70 4,177,384,562 50.0%
2014 1,152,931,800 580,539,700 85,938,200 151,900 2,900 182,024,000 2,001,588,500 19.70 4,002,817,000 50.0%
2015 1,144,848,592 602,472,030 155,934,800 158,100 2,900 183,420,400 2,086,836,822 19.70 4,173,673,644 50.0%
2016 1,162,708,909 643,816,600 162,544,200 175,600 2,900 196,143,891 2,165,392,100 19.70 4,330,784,200 50.0%
Source: Lansing City Assessor
CITY OF LANSING, MICHIGAN
Fiscal
Year
Ended
June 30,
176
Table 6 - Unaudited
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
Tax Operating Service City County School State College Other
Year Millage Millage Millage Millage Millage Education Millage Millage Total
2006 14.95 .93 15.88 8.72 20.32 6.00 3.81 9.15 63.87
2007 14.95 .88 15.83 8.73 20.18 6.00 3.81 8.15 62.70
2008 15.01 .82 15.83 8.87 20.15 6.00 3.81 9.04 63.70
2009 15.44 .26 15.70 8.85 19.95 6.00 3.81 9.93 64.24
2010 15.44 .26 15.70 8.84 19.95 6.00 3.81 9.93 64.23
2011 15.44 .26 15.70 8.85 21.44 6.00 3.81 9.96 65.76
2012 19.44 .26 19.70 9.49 21.73 6.00 3.81 9.96 70.68
2013 19.44 .26 19.70 9.50 21.91 6.00 3.81 9.96 70.88
2014 19.44 .26 19.70 10.20 21.77 6.00 3.81 9.96 71.44
2015 19.44 .26 19.70 9.83 21.83 6.00 3.81 9.96 71.12
(1) rates for Lansing School District only
(2) includes Intermediate School, Airport Authority, Capital
Area Transit Authority and Capital Area District Library.
Source: Lansing City Treasurer
June 30,
CITY OF LANSING, MICHIGAN
Fiscal City Direct Rates Overlapping Rates
Year
Ended
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
(1)(2)
177
Table 7 - Unaudited
Profile of Ten Largest Ad Valorem Taxpayers
Current Year and Nine Years Ago
Percentage Percentage
Taxable of Total Total of Total
Assessed Assessed Assessed Assessed
Taxpayer Valuation Rank Valuation Valuation Rank Valuation
General Motors Corp.59,302,202$ 1 2.74% 133,897,648$ 1 5.11%
Consumers Energy 29,103,567 2 1.34% 21,628,281 4 0.83%
Jackson National Life Insurance Company 27,829,926 3 1.29% 33,130,261 2 1.26%
Sprint Spectrum L.P.19,326,303 4 0.89% 14,526,841 6 0.55%
Phoenix Development Part I LLC 17,022,933 5 0.79%
Emergent Biodefense Operations 13,360,674 6 0.62%
Demmer Corporation 12,287,800 7 0.57%
Lansing Retail Center LLC 11,863,110 8 0.55% 13,139,375 8 0.50%
Phoenix Development Part II LLC 8,133,041 9 0.38%
Eyde Knapp Development LLC 7,940,150 10 0.37%
Delta Township Utilities 25,381,733 3 0.97%
Capitol Outlook LLC 18,764,936 5 0.72%
Accident Fund Company 13,202,404 7 0.50%
Trappers Cove LTD Partners 12,565,459 9 0.48%
Heart of the City Association 10,290,786 10 0.39%
Data furnished from City of Lansing Assessor
2007
CITY OF LANSING, MICHIGAN
2016
178
Table 8 - Unaudited
Property Tax Levies and Collections
Last Ten Fiscal Years
Taxes Levied Current Percent of Delinquent Total Collections
for the Tax Levy Tax Tax as a Percent
Fiscal Year Collection Collected Collection Collection of Levy
2007 42,627,042$ 42,516,696$ 99.74% 107,322$ 42,624,018$ 99.99%
2008 44,286,657 44,125,517 99.64% 144,587 44,270,104 99.96%
2009 45,567,556 45,468,639 99.78% 72,779 45,541,418 99.94%
2010 44,997,919 44,844,495 99.66% 33,012 44,877,507 99.73%
2011 41,460,916 41,375,354 99.79% 24,416 41,399,770 99.85%
2012 39,948,762 39,863,393 99.79% 19,647 39,883,040 99.84%
2013 40,450,767 39,716,932 98.19% 55,532 39,772,464 98.32%
2014 39,336,952 39,238,902 99.75% 20,866 39,259,768 99.80%
2015 38,329,032 38,258,272 99.82% 49,590 38,307,862 99.94%
2016 38,538,226 38,461,152 99.80% 52,758 38,513,910 99.94%
Note: Amounts are net of chargebacks from the County Tax Revolving Funds for taxes still delinquent after three years.
Note: Delinquent Tax Collection represents amounts received in the indicated fiscal year.
Source: City of Lansing Treasurer
June 30,
CITY OF LANSING, MICHIGAN
Collected within the
Fiscal Year of the Levy Total Collections to Date
Fiscal Year
Ended
179
Table 9 - Unaudited
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
General Special Installment General Total
Obligation Assessment Purchase Obligation Revenue Lease Primary Per
Bonds Debt Agreements Loans Bonds Bonds Purchases Loans Government Capita Population
20,128,052$ 10,000$ 15,721,844$ 1,772,049$ 156,536,857$ 44,787,045$ -$ 4,180,000$ 243,135,847$ 11.42%(2)2,041$ 119,100
20,914,466 - 14,037,885 1,534,822 175,578,524 41,921,307 - 4,180,000 258,167,004 12.13%(2)2,168 119,100
17,899,203 - 12,394,082 1,290,479 189,210,199 39,045,570 - 4,180,000 264,019,533 12.41%(2)2,217 119,100
26,329,157 - 10,925,689 1,038,804 199,063,758 36,122,872 - 4,180,000 277,660,280 13.05%(2)2,331 119,100
27,804,224 - 9,564,693 779,580 197,000,901 33,209,092 - 1,574,209 269,932,699 12.17%(3)2,362 114,297
25,816,914 - 8,193,615 512,577 189,536,530 30,135,311 - 1,637,177 255,832,124 11.32%(3)2,238 114,297
29,994,604 - 2,807,838 6,246,743 180,359,931 27,528,327 - 1,702,664 248,640,107 11.01%(3)2,175 114,298
27,180,294 - 3,100,563 7,062,234 174,471,861 24,055,438 1,668,081 - 237,538,471 10.69%(3)2,078 114,298
25,790,281 - 16,387,327 7,872,600 167,787,460 19,445,482 1,459,431 - 238,742,581 10.74%(3)2,089 114,297
21,968,330 - 15,268,317 7,872,600 154,303,563 20,671,135 1,246,673 - 221,330,618 9.88%(3)1,924 115,056
(1) population per decennial census by the U.S. Census Bureau
(2) personal income data comes from U.S. Census Bureau, American Community Survey 2005
(3) personal income data comes from U.S. Census Bureau, American Community Survey 2009
2016
2011
2012
2013
2014
2015
2007
2008
2009
2010
Year Income
CITY OF LANSING, MICHIGAN
Governmental Activities Business-Type Activities
Percentage
Fiscal of Personal
(1)
180
CITY OF LANSING, MICHIGAN Table 10 - Unaudited
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Ratio of
Debt Net Bonded Net
Service Debt Payable Debt to Bonded
Taxable Gross Bonded Monies From Restricted Net Bonded Taxable Debt per
Population(1)Value(3)Debt(2)Available Revenues Debt Value Capita
2007 119,100 2,500,894,289$ 176,674,909$ 309,363$ 162,596,857$ 13,768,689$ 0.0055 116
2008 119,100 2,619,195,965 196,492,990 256,144 184,442,624 11,794,222 0.0045 99
2009 119,100 2,658,126,184 207,109,402 186,636 197,225,199 9,697,567 0.0036 81
2010 119,100 2,662,792,292 225,392,915 126,434 206,198,758 19,067,723 0.0072 160
2011 114,297 2,446,969,549 224,805,125 46,029 203,225,901 21,533,195 0.0088 188
2012 114,297 2,297,591,331 215,353,444 - 194,911,530 20,441,914 0.0089 179
2013 114,298 2,088,692,281 210,354,535 178 184,849,931 25,504,427 0.0122 223
2014 114,298 2,001,588,500 201,652,155 - 178,031,861 23,620,294 0.0118 207
2015 114,297 2,086,836,822 193,577,741 1,000 170,372,460 23,204,281 0.0111 203
2016 115,056 2,165,392,100 176,271,893 1,000 155,873,563 20,397,330 0.0094 177
(1) Source: 2000 and 2010 Census by the U.S. Census Bureau
(2) includes all general obligation debt and special assessment debt with governmental obligation
(3) the tax assessment day is December 31 prior to beginning of fiscal year
Fiscal
Year
Ended
June 30,
181
CITY OF LANSING, MICHIGAN Table 11 - Unaudited
Direct and Overlapping Governmental Activities Debt
As of June 30, 2016
Net General
Obligation Amount
Debt % Applicable Applicable
Outstanding to City to City
Net direct - City 45,109,247$ 100.00% 45,109,247$
Share of County-issued bonds
Joint Building Authority 1,612,808 100.00% 1,612,808
Drain Commission 1,283,146 100.00% 1,283,146
2,895,954$
Overlapping debt
Eaton Intermediate School District 740,000$ 0.58% 4,292$
Ingham Intermediate School District 1,836,000 22.81% 418,792
Waverly School District 29,760,000 0.22% 65,472
Lansing School District 39,930,000 81.04% 32,359,272
East Lansing School District 41,068,377 3.74% 1,535,957
Holt School District 70,412,946 2.38% 1,675,828
Ingham County 30,064,178 26.07% 7,837,731
Eaton County 30,395,466 1.60% 486,327
Clinton County 2,053,375 0.28% 5,749
Lansing Community College 72,720,000 18.82% 13,685,904
Okemos School District 17,629,329 2.76% 486,569
Mason School District 13,365,000 0.35% 46,778
Grand Ledge School District 51,650,000 1.22% 630,130
Total overlapping debt 59,238,801
Total direct and overlapping debt 107,244,002$
Source: Municipal Advisory Council of Michigan
Note: Overlapping debt percentages are apportioned based upon relative assessed values.
Name of
Governmental Unit
182
Table 12 - Unaudited
Legal Debt Margin Information
Last Ten Fiscal Years
Legal Debt Margin Calculation for Fiscal Year 2016
Assessed value, real and personal property 2,165,392,100$
Legal debt margin
Debt limitation - 10 percent of total valuation 216,539,210
Debt applicable to limit
Total City Bonded Debt 196,943,028
City Share:
Drain Commission-County Issued 1,283,146
Joint Building Authority-County Issued 1,612,808
TIF Supported Bonds 16,650,973
216,489,955
Less:
Michigan Transportation (MTF) Bonds (1,570,000)
Sewage Disposal Revenue Bonds (18,725,000)
Pollution Abatement (CSO Project) Bonds (109,762,496) (130,057,496)
Total net debt applicable to limit 86,432,459
Legal debt margin 130,106,751$
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Debt limit
216,539,210$ 208,683,682$ 205,138,999$ 208,869,228$ 233,669,637$ 268,975,768$ 298,052,683$ 298,581,799$ 318,810,868$ 324,987,531$
Total net debt applicable to limit
86,432,459 91,352,614 93,062,835 91,833,157 92,357,575 100,923,863 98,368,804 79,513,756 87,966,365 84,276,312
Legal debt margin
130,106,751$ 117,331,068$ 112,076,164$ 117,036,071$ 141,312,062$ 168,051,905$ 199,683,880$ 219,068,043$ 230,844,503$ 240,711,219$
Total net debt applicable to the limit
as a percentage of debt limit
39.92% 43.78% 45.37% 43.97% 39.52% 37.52% 33.00% 26.63% 27.59% 25.93%
CITY OF LANSING, MICHIGAN
183
Table 13 - Unaudited
Pledged-Revenue Coverage
Last Ten Fiscal Years
Direct Net Revenue
Gross Operating Available for
Revenue Expenses(1)Debt Service Principal Interest Total Coverage(2)
2007 29,292,698$ 13,494,658$ 15,798,040$ 3,950,000$ 2,152,990$ 6,102,990$ 2.59
2008 29,356,299 15,997,449 13,358,850 2,830,000 2,002,400 4,832,400 2.76
2009 27,759,684 14,206,961 13,552,723 2,840,000 1,900,000 4,740,000 2.86
2010 28,613,004 12,358,472 16,254,532 2,840,000 1,803,425 4,643,425 3.50
2011 29,865,648 12,616,100 17,249,548 2,925,000 1,621,221 4,546,221 3.79
2012 30,178,511 12,562,663 17,615,848 3,040,000 1,448,856 4,488,856 3.92
2013 31,169,428 12,112,994 19,056,434 3,160,000 1,111,390 4,271,390 4.46
2014 31,996,794 13,424,901 18,571,893 3,265,000 1,054,878 4,319,878 4.30
2015 31,945,082 13,295,574 18,649,508 1,490,000 920,788 2,410,788 7.74
2016 32,368,491 14,526,590 17,841,901 1,550,000 861,188 2,411,188 7.40
(1) Operating expenses less depreciation
(2) Coverage is defined as net revenue available for debt service divided by
debt service requirements
CITY OF LANSING, MICHIGAN
Sewage Disposal Bonds
Debt Service Requirements
184
Table 14 - Unaudited
Demographic and Economic Statistics
Last Ten Fiscal Years
Per capita Lansing School
Personal Personal Median District Unemployment Labor
Population(1)Income Income(1)Age(1)Enrollment(2)% Rate(3)Force(3)
2007 119,100 2,129,750,646$ 17,882$ 32.52 15,178 8.9% 66,224
2008 119,100 2,129,040,730 17,876 32.68 14,475 10.2% 65,833
2009 119,100 2,128,331,049 17,870 32.84 14,482 16.2% 66,822
2010 119,100 2,127,621,606 17,864 32.92 14,098 15.0% 64,074
2011 114,297 2,218,237,360 19,408 30.40 13,465 13.1% 63,130
2012 114,297 2,259,194,502 19,766 32.40 13,236 11.3% 63,374
2013 114,298 2,259,194,502 19,766 32.20 12,544 11.9% 63,181
2014 114,298 2,221,933,680 19,440 32.00 12,088 9.1% 63,102
2015 114,297 2,221,933,600 19,440 32.10 11,587 7.4% 57,432
2016 115,056 2,240,255,376 19,471 32.10 11,112 6.0% 57,633
(1) Source: U.S. Census Bureau
(2) Source: Lansing School District
(3) Source: Michigan Bureau of Labor Market Information and Strategic Initiatives
CITY OF LANSING, MICHIGAN
Year
185
Table 15 - Unaudited
Principal Employers
Current Year and Nine Years Ago
Percentage Percentage
of Total City of Total City
Employees (1)Rank Employment (2)Employees (1)Rank Employment
State of Michigan 13,700 1 5.97%13,000 1 5.65%
Michigan State University 10,725 2 4.67%10,500 2 4.56%
Sparrow Health System 5,735 3 2.50%6,000 4 2.61%
General Motors 5,222 4 2.28%6,000 3 2.61%
Lansing Community College 2,990 5 1.30%3,800 5 1.65%
McClaren Greater Lansing 2,400 6 1.05%2,500 7 1.09%
Lansing School District 1,613 7 0.70%3,000 6 1.30%
Meijer 1,500 8 0.65%2,000 8 0.87%
Auto Owners Insurance 1,400 9 0.61%1,500 9 0.65%
Jackson National Life Insurance 1,400 10 0.61%
U.S. Post Office 1,200 10 0.52%
Greater Lansing metropolitan area employment 229,466 230,075
(1) Data is representative of the Greater Lansing Region
(2) Source: Michigan Department of Career Development: Employment Service Agency - Labor Market Information
2007
Employer
CITY OF LANSING, MICHIGAN
2016
186
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187
CITY OF LANSING, MICHIGAN
Full-time Equivalent City Governmental Employees by Function/Program
Last Ten Fiscal Years
General government
City council 10 10 10 10 10 11
Mayor's office 6 5 5 5 5 5
City clerk 5 5 5 5 5 6
54-A district court 45 46 43 43 48 50
City attorney's office 11 11 10 10 10 11
City TV 2 2 2 2 2 2
Internal auditor 1 1 1 1 1 1
Human resources 12 10 10 9 9 11
Information technology 11 11 11 10 10 14
Finance
Accounting/budget/purchasing 8 (9)9 10 10 13 14
Treasury/income tax 10 9 9 20 10 11
Assessing 11 11 11 11 11
Property management - - - - (6)18 20
Fleet management - - - - (6)27 29
29 29 30 30 79 85
Planning & neighborhood development
Administration 2 2 2 2 2 2
Code compliance - - - (8)15 15 16
Building safety 13 13 13 12 13 15
Planning 4 4 4 4 4 5
Development 10 10 11 9 9 9
Parking & transportation 14 14 15 20 20 20 (5)
43 43 45 62 63 66
Police 234 234 234 (8)229 (7)260 327
Fire 181 181 188 180 179 207
Code compliance 14 14 14 (8)
195 195 202 180 179 207
Public services -
Administration & engineering 20 19 19 19 21 21
Operations & maintenance 117 117 117 (8)120 121 135 (5)
Service garage - - - - - -
Wastewater 41 41 41 41 41 41
Property Management 18 18 18 18 (6)
Fleet Management 26 27 27 27 (6)
222 222 222 225 183 197
Human relations & community services 7 7 6 5 5 5
Function/Program 20112014 2013 201220152016
188
Table 16 - Unaudited
11 11 11 11
5 5 5 5
7 7 7 7
53 53 53 55
12 12 12 12
2 2 2 2
1 1 1 1
12 13 14 14 (1)
15 17 18 18
16 17 16 18 (1)
12 13 13 15
12 12 13 14
21 23 24 26 (3)
30 31 33 37 (2)
91 96 99 110
2 2 2 2
16 16 17 19
15 15 15 16
5 4 5 7
9 10 10 10
40 41 41 43
87 88 90 97
344 342 341 338
218 219 219 219
218 219 219 219
17 18 18 18
110 113 113 119
- - - (2)
44 50 50 51
171 181 181 188
5 6 8 9
continued…
2010 2009 2008 2007
189
CITY OF LANSING, MICHIGAN
Full-time Equivalent City Governmental Employees by Function/Program
Last Ten Fiscal Years
Parks & recreation
Administration & design 6 6 6 5 5 5
Grounds & forestry - - - - - - (5)
Leisure & special recreation 6 6 6 8 10 12
Cemeteries 1 1 1 1 1 1
Golf/ice arena 3 3 3 3 3 4
Zoo - - - - - -
16 16 16 17 19 22
849 847 852 843 888 1,020
Source: The City of Lansing, Michigan
In FY 2007, the following restructuring of departments occurred:
In FY 2011, the following restructuring of departments occurred:
In FY 2013, the following restructuring of departments occurred:
In FY 2014, the following restructuring of a department occurred:
In FY 2016, the following restructuring of a department occurred:
(9) Purchasing operations were transferred to the Lansing Board of Water and Light for FY 2016.
(3) Four custodial positions were transferred from Parks & Recreation to Finance
(2) Operations of the City's three fleet garages was consolidated in Finance
(1) A payroll position was transferred from Finance to Human Resources
Function/Program 2016 2015 2014 2013 2012 2011
(8) Fourteen positions are transferred from PND to Fire; four to Police, and one to Public Service.
(7) On June 27, 2012, 911 Dispatch employees were transferred from the City to Ingham County
(6) Fleet and Property Management were moved from the Finance Department to the Public Service Department
(5) Grounds Maintenance positions were moved from Parks & Recreation and Planning & Neighborhood Development and
consolidated with Public Service staff
(4) On July 1, 2007, Potter Park Zoo employees were transferred to Ingham County
190
7 7 8 8
27 31 32 32 (2)
15 19 17 19 (3)
3 4 4 5
4 4 4 4
- - - 18 (4)
56 65 65 86
1,090 1,118 1,126 1,172
concluded
20072010 2009 2008
191
CITY OF LANSING, MICHIGAN Table 17 - Unaudited
Operating Indicators by Function/Program
Last Ten Fiscal Years
2015 2014 2013 2012 2011 2010 2009 2007
Public safety
Fire department responses 21,115 20,170 19,427 18,444 17,093 16,974 16,659 15,852 15,780 15,267
EMS related 18,275 17,376 16,235 15,918 14,851 14,628 14,398 13,447 13,151 12,779
Fire related 2,840 2,794 3,012 2,526 2,242 2,346 2,261 2,405 2,629 2,488
Police department responses 71,468 79,331 76,855 73,087 74,058 78,112 87,724 89,958 87,634 97,466
Arrests 3,880 4,510 5,656 7,196 8,043 8,858 11,644 11,559 12,810 13,260
Traffic violations 7,334 10,781 7,756 14,905 8,829 15,585 18,297 20,122 25,398 29,047
Public works
Potholes filled 53,488 53,281 55,193 33,155 30,116 32,918 24,945 43,601 40,790 28,122
Streets resurfaced (miles)9 4 4.60 6.00 5.01 8.99 20.70 16.20 20.92 22.11
Recreation
Recreation participation 101,335 122,639 50,859 55,122 66,836 66,254 70,529 39,060 37,783
(1)41,069
Pavilion rentals 242 206 185 199 198 161 288 315 341 254
Sewage disposal
Average amount processed
daily (gal)15.46 million 13.28 million 14.49 million 14.75 million 12.82 million 12.83 million 15.01 million 18.15 million 16.73 million 16.00 million
Parking system
Average number of monthly permits 3,218 3,077 2,891 2,718 2,735 3,122 3,480 3,783 4,059 3,905
Parking tickets issued 32,990 30,888 34,373 38,127 41,829 45,176 63,610 66,183 57,153 75,637
Cemetery
Lots sold 115 138 93 113 115 143 142 119 98 114
Golf
Annual rounds played 13,325 (3)22,998 22,786 25,554 28,560 26,084 30,936 41,588 43,605
(2)59,244
Garbage and rubbish
Yards sent to landfill 20,115 19,667 18,829 17,985 18,705 20,334 21,805 29,322 29,869 30,402
Recycling
Recycled goods sold (tons) 5,940 5,691 5,075 3,562 3,149 2,446 2,163 2,591 2,818 2,269
Yards composted 24,413 21,685 25,260 21,832 20,413 15,725 21,819 21,871 21,928 17,189
Source: The City of Lansing, Michigan
(1) The addition of the Southside Community Center, with a pool, resulted in a large increase in recreation participation in FY 2010
(2) Two golf course were closed in FY 2008 with one of those being converted to a driving range
(3) Groesbeck golf course was closed due to during the months of May - June, 2016 for stormwater management course alterations.
Function/Program 20082016
192
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193
CITY OF LANSING, MICHIGAN
Capital Assets Statistics by Function/Program
Last Ten Fiscal Years
2016 2015 2014 2013 2012 2011
Public safety
Police stations 2 2 2 2 2 3
Police patrol units 60 60 61 60 60 58
Fire stations 6 6 6 6 6 8
Public works
Streets (miles)414.00 414.00 411.00 411.00 407.80 410.80
Traffic signals 200 200 200 204 204 208
Recreation
Park acreage 2,134.26 2,363.45 2,364.85 2,364.85 2,434.88 2,422.63
Playgrounds 74 72 72 75 73 71
Baseball/softball fields 25 47 61 61 61 61
Soccer/football fields 14 66666
Community centers 4 44444
Sewage disposal
Sanitary sewers (miles)361 361 359 359 359 359
Storm sewers (miles)235 235 234 234 234 234
Combined sewers (miles)188 188 188 188 188 188
Parking system
Ramps 4 44444
Lots 16 17 17 18 15 15
Meters 2,166 2,166 2,452 2,452 2,452 2,452
Cemetery
Number of cemeteries 3 33333
Golf
Number of courses 1 11111
Acreage 115 115 115 115 115 115
Garbage and rubbish
Refuse collection trucks 14 17 17 17 19 22
Recycling
Recycling trucks 5 77779
Potter park zoo
Number of animals N/A N/A N/A N/A N/A N/A
Source: The City of Lansing, Michigan
(1) Zoo operations were transferred to Ingham County in 2008
(2) Two municipal golf courses were non-operational beginning in 2008
Function/Program
194
Table 18 - Unaudited
2010 2009 2007
3 3 3 3
61 61 58 55
9 9 9 9
410.63 410.15 410.15 410
203 196 203 188
2,422.63 2,422.63 2,422.63 2,219.63
71 82 82 80
61 61 61 61
666 6
444 4
357 354 347.4 341.0
233 230 225.1 220.0
191 192 197.4 203.0
446 6
16 16 15 15
2,493 2,493 2,489 2,489
333 3
111(2)3
115 115 115
(2)318
18 16 21 21
10 10 10 10
N/A N/A N/A
(1)398
2008
195