2024 Auditor's Report
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORT
CITY OF ATLANTIC BEACH, FLORIDA
SEPTEMBER 30, 2024
CITY OF ATLANTIC BEACH, FLORIDA
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORT
SEPTEMBER 30, 2024
INDEPENDENT AUDITOR’S REPORT ...................................................................................................................................... 1
MANAGEMENT’S DISCUSSION AND ANALYSIS ..................................................................................................................... 5
BASIC FINANCIAL STATEMENTS
GOVERNMENT-WIDE FINANCIAL STATEMENTS
STATEMENT OF NET POSITION ........................................................................................................................................... 14
STATEMENT OF ACTIVITIES ................................................................................................................................................. 15
FUND FINANCIAL STATEMENTS
BALANCE SHEET – GOVERNMENTAL FUNDS ...................................................................................................................... 16
RECONCILIATION OF BALANCE SHEET OF GOVENRMENTAL FUNDS TO THE STATEMENT OF NET
POSITION ............................................................................................................................................................................ 17
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL
FUNDS ................................................................................................................................................................................. 18
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES .................................................................... 19
STATEMENT OF NET POSITION – PROPRIETARY FUNDS ..................................................................................................... 20
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION – PROPRIETARY FUNDS ................................... 22
STATEMENT OF CASH FLOWS ............................................................................................................................................. 24
STATEMENT OF FIDUCIARY NET POSITION ......................................................................................................................... 26
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION .................................................................................................... 27
NOTES TO FINANCIAL STATEMENTS ..................................................................................................................................... 28
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL
– GENERAL FUND ................................................................................................................................................................ 62
NOTES TO THE SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL – GENERAL FUND ........................................................................................................................... 64
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL
– AMERICAN RESCUE PLAN ACT SPECIAL REVENUE FUND ................................................................................................. 65
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS
GENERAL EMPLOYEES’ PENSION PLAN .......................................................................................................................... 66
POLICE OFFICERS’ PENSION PLAN .................................................................................................................................. 68
SCHEDULE OF CONTRIBUTIONS – ALL PENSION PLANS...................................................................................................... 70
NOTES TO THE SCHEDULE OF CONTRIBUTIONS – ALL PENSION PLANS ............................................................................. 71
SCHEDULE OF INVESTMENT RETURNS – ALL PENSION PLANS ........................................................................................... 72
SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS ........................................................................ 73
NOTES TO THE SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS ............................................... 74
CITY OF ATLANTIC BEACH, FLORIDA
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORT
SEPTEMBER 30, 2024
SUPPLEMENTARY INFORMATION
COMBINING BALANCE SHEET – NON-MAJOR GOVERNMENTAL FUNDS ............................................................................ 75
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – NON-
MAJOR GOVERNMENTAL FUNDS ....................................................................................................................................... 77
HISTORICAL REVENUES AND EXPENSES .............................................................................................................................. 79
SCHEDULES OF NET REVENUES IN ACCORDANCE WITH BOND RESOLUTIONS – ENTERPRISE FUNDS
(WATER AND SEWER) ......................................................................................................................................................... 80
OTHER BOND COVENANT DISCLOSURES ............................................................................................................................ 81
OTHER STATISTICAL INFORMATION
MAJOR UTILITY CUSTOMERS .............................................................................................................................................. 82
ADDITIONAL ELEMENTS OF REPORT PREPARED IN ACCORDANCE WITH GOVERNMENT
AUDITING STANDARDS, ISSUED BY THE COMPTROLLER GENERAL OF THE UNITED STATES; THE
RULES OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA; AND OTHER CONTRACT
REQUIREMENTS
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF BASIC FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS ................................................................... 83
INDEPENDENT ACCOUNTANT’S REPORT ON COMPLIANCE WITH FLORIDA STATUTES SECTION 218.415
– INVESTMENT OF PUBLIC FUNDS ...................................................................................................................................... 86
INDEPENDENT ACCOUNTANT'S REPORT ON COMPLIANCE FOR THE U.S. TREASURY CORONAVIRUS
STATE AND LOCAL FISCAL RECOVERY FUNDS PROGRAM (CSLFRF) REQUIREMENTS FOR AN
ALTERNATIVE CSLFRF COMPLIANCE EXAMINATION ENGAGEMENT .................................................................................. 87
MANAGEMENT LETTER ....................................................................................................................................................... 88
MANAGEMENT’S RESPONSE TO FINDINGS ........................................................................................................................ 91
1
INDEPENDENT AUDITOR’S REPORT
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
Report on the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of Atlantic Beach,
Florida (the City) as of and for the year ended September 30, 2024, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund,
and the aggregate remaining fund information of the City as of September 30, 2024, and the respective
changes in financial position and, where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
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. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our
report. We are required to be independent of the City and to meet our other ethical responsibilities in
accordance with the relevant ethical requirements relating to our audit. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with accounting principles generally accepted in the United States of America, and for 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.
2
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
INDEPENDENT AUDITOR’S REPORT
In preparing the financial statements, management is required to evaluate whether there are conditions
or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as
a going concern for twelve months beyond the financial statement date, including any currently known
information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance
and, therefore, is not a guarantee that an audit conducted in accordance with generally accepted auditing
standards and Government Auditing Standards will always detect a material misstatement when it exists.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control. Misstatements are considered material if there is a substantial likelihood
that, individually or in the aggregate, they would influence the judgment made by a reasonable user based
on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government
Auditing Standards, we:
■ Exercise professional judgment and maintain professional skepticism throughout the audit.
■ Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, and design and perform audit procedures responsive to those risks. Such procedures
include examining, on a test basis, evidence regarding the amounts and disclosures in the financial
statements.
■ Obtain an understanding of internal control relevant to the audit 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 City’s internal control. Accordingly, no such opinion is expressed.
■ Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
■ Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that
raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period
of time.
We are required to communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit, significant audit findings, and certain internal control-related
matters that we identified during the audit.
3
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
INDEPENDENT AUDITOR’S REPORT
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis, General Fund – Budgetary to Actual Schedule and notes to the schedule, ARPA
Fund – Budgetary to Actual Schedule, and Required Pension and Other Postemployment Benefits
Schedules, 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.
Supplementary 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 accompanying combining and individual non-major
fund financial statements, historical revenues and expenses, schedule of net revenues in accordance with
bond resolutions, and other bond covenant disclosures (supplementary information) are presented for
purposes of additional analysis and are not a required part of the basic financial statements. Such
information is the responsibility of management and was derived from and relates directly to the
underlying accounting and other records used to prepare the basic financial statements. The information
has been subjected to the auditing procedures applied in the audit of the basic financial statements and
certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the basic financial statements or to the basic
financial statements themselves, and other additional procedures in accordance with auditing standards
generally accepted in the United States of America. In our opinion, the supplementary information is
fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other
information comprises the statistical schedule but does not include the basic financial statements and our
auditor’s report thereon. Our opinions on the basic financial statements do not cover the other
information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other
information and consider whether a material inconsistency exists between the other information and the
basic financial statements, or the other information otherwise appears to be materially misstated. If,
based on the work performed, we conclude that an uncorrected material misstatement of the other
information exists, we are required to describe it in our report.
4
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
INDEPENDENT AUDITOR’S REPORT
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have issued our report dated September 30, 2025,
on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts and grant agreements, and other
matters. The purpose of that report is to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on internal control
over financial reporting or on compliance. That report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the City’s internal control over financial
reporting and compliance.
Report on Summarized Comparative Information
We have previously audited the City’s 2023 financial statements, and our report dated January 10, 2025,
expressed an unmodified opinion on those audited financial statements. In our opinion, the summarized
comparative information presented herein as of and for the year ended September 30, 2023, is consistent,
in all material respects, with the audited financial statements from which it was derived.
September 30, 2025
Gainesville, Florida
MANAGEMENT’S DISCUSSION AND ANALYSIS
5
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
As management of the City of Atlantic Beach, Florida (the City), we offer readers of our financial statements this
narrative overview and analysis for the fiscal year ended September 30, 2024.
Overview of the Financial Statements
This management’s discussion and analysis is intended to serve as an introduction to the City’s basic financial
statements. The City’s basic financial statements are comprised of three components: 1) government-wide
financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also
contains other supplementary information in addition to the basic financial statements themselves. The purpose
of each of the three components of the basic financial statements is described below.
Government-wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the City’s
finances, in a manner similar to a private sector business. They include the Statement of Net Position and the
Statement of Activities.
The Statement of Net Position presents information on all of the City’s assets, deferred outflows of resources,
liabilities, and deferred inflows of resources with the difference between reported as net position. Net position is
reported as one of three categories: invested in capital assets net of related debt; restricted; or unrestricted.
Restricted net position is further classified as either net position restricted by enabling legislation or net position
that is otherwise restricted. Over time, increases or decreases in net position may serve as a useful indicator of
whether the financial position of the City is improving or deteriorating.
The Statement of Activities presents information showing how the City’s net position changed during the most
recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change
occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement
for some items that will only result in cash flows in future fiscal periods.
Both of the government-wide financial statements distinguish functions of the City that are principally supported
by taxes and intergovernmental revenues, referred to as “governmental activities,” from other functions that are
intended to recover all or a significant portion of their costs through user fees and charges, referred to as
“business-type activities.” The governmental activities of the City include public safety, road maintenance and
construction, parks and recreation, conservation and resource management, and general government, which
include administration and other support functions. The business-type activities of the City include the utility,
comprised of the water and sewer systems, the stormwater system, the sanitation service and the building code
enforcement enterprise fund. The government-wide financial statements can be found by referencing the table
of contents of this report.
6
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(continued)
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated
for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure
and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be
categorized into either governmental funds, proprietary funds, or fiduciary funds.
■ Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental activities
in the government-wide financial statements. However, unlike the government-wide financial statements,
governmental fund financial statements focus on near-term inflows and outflows of available financial
resources, as well as on balances of available resources at the end of the fiscal year. Such information may be
useful in evaluating a City’s near-term financing requirements. Because the focus of governmental funds is
narrower than that of the government-wide financial statements, it is useful to compare the information
presented for governmental funds with similar information presented for governmental activities in the
government-wide financial statements. By doing so, readers may better understand the long-term impact of the
government’s near-term financing decisions. Reconciliations are provided between the Governmental Funds
Balance Sheet and the Statement of Net Position and the Governmental Funds Statement of Revenues,
Expenditures, and Changes in Fund Balances and Statement of Activities to facilitate this comparison between
governmental funds and governmental activities.
The City maintains 14 individual governmental funds. Information is presented separately in the Governmental
Funds Balance Sheet and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund
Balances for the General Fund, American Rescue Plan Act Special Revenue Fund and Capital Projects Fund which
are considered to be a major funds. Data from the other 11 governmental funds are combined into a single,
aggregated presentation called Nonmajor Governmental Funds. Fund data for these nonmajor governmental
funds is provided in the form of combining statements. These combining statements can be found by referencing
the table of contents of this report.
The City adopts an annual appropriated budget for all funds but is only required to present a budget comparison
for its special revenue funds. Budgetary comparison schedules can be found by referencing the table of contents
of this report and has been provided to demonstrate compliance with the budget.
■ Proprietary Funds
The City maintains only one type of proprietary fund and that is enterprise funds. The enterprise funds are
used to account for the activities of the water and sewer (utility), stormwat er, building code enforcement,
and sanitation activities.
The proprietary fund financial statements provide the same type of information as the government-wide
financial statements, only in more detail. Separate information of the utility, stormwater, sanitation and building
code enforcement activities can be found in the basic proprietary fund financial statements by referencing the
table of contents of this report.
7
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
Fund Financial Statements (concluded)
■ Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefit of parties outside the City (i.e., pension
beneficiaries). Fiduciary funds are not reflected in the government-wide financial statements because the
resources of those funds are not available to support the City’s own programs. The accounting used for
fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statements can
be found by referencing the table of contents of this report.
Notes to Financial Statements
The notes to financial statements provide additional information that is essential to a full understanding of the data
provided in the government-wide and fund financial statements. The notes can be found by referencing the table of
contents of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information concerning the City’s progress in funding its obligation to provide pension benefits to
its employees and a budgetary comparison schedule for the General Fund. Required supplementary information
can be found by referencing the table of contents of this report.
8
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
Government-wide Financial Analysis
Net position may serve over time as a useful indicator of a City’s financial position. As can be seen in the
summarized table below, the City’s assets exceeded liabilities by $109,248,401 at the close of the fiscal year ended
September 30, 2023.
By far the largest portion of the City’s net position, $79,339,349 (73%), reflects its investment in capital assets (i.e.,
land, buildings, equipment, and infrastructure), less any related, outstanding debt used to acquire those assets. The
City uses these capital assets to provide services to citizens; consequently, these assets are not available for future
spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the
resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot
be used to liquidate these liabilities.
A portion of the City’s net position, $4,645,186 (4%), represents resources that are subject to external restrictions
on how they may be used. The remaining balance of unrestricted net position, $25,263,866 (23%), is used to meet
the government’s ongoing obligations to citizens and creditors.
Statement of Net Position (Summary)
as of September 30,
Governmental Activities Business-type Activities Total Primary Government
2024 2023 2024 2023 2024 2023
Current and other assets $ 16,574,304 $ 18,855,603 $ 20,679,596 $ 20,573,461 $ 37,253,900 $ 39,429,064
Capital assets 52,957,713 48,201,682 34,219,376 33,985,024 87,177,089 82,186,706
Total assets 69,532,017 67,057,285 54,898,972 54,558,485 124,430,989 121,615,770
Deferred outflows 2,339,181 5,181,216 958,423 1,688,140 3,297,604 6,869,356
Current liabilities 2,182,565 3,091,817 4,293,103 3,889,634 6,475,668 6,981,451
Non-current liabilities 4,731,919 7,378,643 5,984,985 8,370,813 10,716,904 15,749,456
Total liabilities 6,914,484 10,470,460 10,278,088 12,260,447 17,192,572 22,730,907
Deferred inflows 390,723 456,532 896,897 966,937 1,287,620 1,423,469
Net position:
Net investment in
capital assets 51,827,703 47,062,375 27,511,646 25,625,960 79,339,349 72,688,335
Restricted 1,433,635 1,509,059 3,211,551 3,050,379 4,645,186 4,559,438
Unrestricted 11,304,653 12,740,075 13,959,213 14,342,902 25,263,866 27,082,977
Total net position $ 64,565,991 $ 61,311,509 $ 44,682,410 $ 43,019,241 $ 109,248,401 $ 104,330,750
9
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
As illustrated in the schedule on page 14, the City was able to report positive balances in all categories of net
position, both for the government as a whole, as well as for its separate governmental and business-type activities.
The same situation held true for the prior fiscal year.
Statement of Activities (Summary)
For the year ended September 30,
Governmental Activities Business-type Activities Total Primary Government
2024 2023 2024 2023 2024 2023
Revenues:
Program Revenues:
Charges for services $ 1,394,190 $ 1,493,312 $ 14,123,500 $ 13,996,425 $ 15,517,690 $ 15,489,737
Operating grants/contrib. 281,272 414,304 - - 281,272 414,304
Capital grants/contrib. 522,608 173,928 564,309 690,177 1,086,917 864,105
General revenues:
Property taxes - General 7,241,664 7,224,605 - - 7,241,664 7,224,605
Pub svc tax/franchise fees 1,975,611 2,073,377 - - 1,975,611 2,073,377
Transportation fuel taxes 887,117 909,382 - - 887,117 909,382
Discretionary Sales Surtax 1,270,973 1,241,724 1,270,973 1,241,724
State shared revenue 2,237,681 2,405,210 - - 2,237,681 2,405,210
Grants 1,179,539 2,879,280 - - 1,179,539 2,879,280
Other 900,086 551,609 1,134,944 487,381 2,035,030 1,038,990
Total revenues 17,890,741 19,366,731 15,822,753 15,173,983 33,713,494 34,540,714
Expenses:
Governmental activities:
General government 3,960,982 3,666,361 - - 3,960,982 3,666,361
Public safety 7,544,514 7,679,550 - - 7,544,514 7,679,550
Transportation 2,664,233 2,137,896 - - 2,664,233 2,137,896
Parks and recreation 1,882,586 1,930,725 - - 1,882,586 1,930,725
management 41,297 27,767 - - 41,297 27,767
Interest on long-term debt 35,855 38,873 - - 35,855 38,873
Business-type activities:
Utility - - 8,207,337 8,150,058 8,207,337 8,150,058
Stormwater - - 1,539,805 1,500,447 1,539,805 1,500,447
Sanitation - - 2,338,794 2,303,212 2,338,794 2,303,212
Building code enforcement - - 580,440 576,531 580,440 576,531
Total expenses 16,129,467 15,481,172 12,666,376 12,530,248 28,795,843 28,011,420
Transfers in (out) 1,493,208 (532,975) (1,493,208) 532,975 - -
Change in Net Position 3,254,482 3,352,584 1,663,169 3,176,710 4,917,651 6,529,294
Net position - Beginning 61,311,509 57,958,925 43,019,241 39,842,531 104,330,750 97,801,456
Net position - Ending $ 64,565,991 $ 61,311,509 $ 44,682,410 $ 43,019,241 $ 109,248,401 $ 104,330,750
10
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
Fund Financial Analysis
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements. Following is a summary of fund activity financial information for the fiscal year, rounded to the
nearest thousand dollars:
■ Governmental Funds
At the end of the current fiscal year, the City’s governmental funds reported a combined ending fund balance of
$14,409,667 a decrease of $1,373,555 in comparison with the prior year.
The General Fund is the chief operating fund of the City. At the end of the current fiscal year, the unassigned
fund balance was $4,904,941, which equated to 31% of total General Fund expenditures. The net result of
various revenue, expenditures and other financing sources and uses resulted in a $225,745 decrease to the
general fund’s total fund balance or -2% during the current fiscal year. Property tax revenues increased by
$17,059 or <1% from the previous year. This was a result of an increase in the taxable values. General Fund
incoming transfers decreased by $558,857, and outgoing transfers increased from $101,250 in 2023 to $259,848
in 2024. Overall, general fund expenditures increased by $858,973 or 6%. This can be attributed primarily to
increases in capital outlay expenditures which account for approximately $707,000 of the increase.
The City reports two additional major funds as of September 30, 2024, the American Rescue Plan Act (ARPA)
special revenue fund and the capital projects fund. The ARPA special revenue fund was established in 2022 to
report the sources, uses and residual balances of the ARPA State and Local Fiscal Recovery Funds. Revenue
recognized in the ARPA special revenue funds was $1,179,538 and was equal to the allowable costs paid with
these funds during the year. Prior to 2022 the capital projects fund was reported as a nonmajor fund and has
been accumulating resources for capital projects to the extent that this fund met the definition of a major fund
in 2022 and beyond. The capital projects fund expended $4,549,265 on capital projects in 2024 and reported
total assets of $3,092,692 on September 30, 2024, which is restricted or assigned for various construction
projects.
Nonmajor governmental funds consisting of special revenue funds and the debt service fund which have a
combined fund balance of $1,265,134. The net increase in fund balance, after transfers, of the nonmajor
governmental funds was $465,755. The increase was a result of expenditures and transfers out being less than
nonmajor governmental fund revenue. In the prior year, nonmajor governmental funds reported a decrease
of $492,337. In 2024, net transfers to other funds declined by $534,478 and capital outlay expenditures fell
by $263,127. These two factors were the primary contributors to the increase in nonmajor governmental fund
balances in 2024 compared to 2023.
Revenue Highlights:
• Total General Fund Revenues for 2024 were approximately $58,600 (<1%) less than 2023 revenue.
Increase in investment earning revenue of $325,053 is the largest contributor to this increase.
Decreases in non-property taxes of $103,025 and licenses and permits of $153,626 are the largest
categories experiencing a year-over-year decline.
• The 2024 Intergovernmental revenues of $2,573,445 make up 19% of general fund revenues. This is
an increase of $28,540 over 2023.
• The City’s investment portfolio is valued at approximately $26,939,657 as of September 30, 2024. The
investments showed an increase of approximately $1,873,000 compared to an increase of
approximately $780,000 in the prior year.
11
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
• The 2024 taxable property values were about 21% higher than the 2023 values. The City Commission
voted to reduce the millage rate to 2.8410 mills, instead of keeping the prior year rate of 3.1035. The
purpose for adopting the millage rate of 2.8410 was to offer tax relief to the citizens and maintain
adequate funding for the existing level of services at the estimated cost and continue to maintain the
City’s infrastructure and adequate reserves. The final gross taxable property value was
$2,913,053,436. Ad valorem taxes of $7,241,664 represent 46% of the General Fund revenues for
2024.
Expenditure Highlights:
• Total Governmental Fund Expenditures increased in current year by $2,281,997 or 12% when compared
to prior year. Capital expenditures increased by $2,019,640 (47%) in 2024 compared to 2023. This
increase is due to the City running into challenges completing, and in many instances, starting the slated
projects. Personnel related costs of the governmental funds increased by approximately $400,000 or 4%
when compared to the prior year.
■ Proprietary Funds
The City’s proprietary funds provide the same type of information found in the government-wide financial
statements, but in more detail. During the fiscal year the proprietary funds recorded operating revenues of
$14,175,395, operating expenses of $12,426,403, net non-operating revenue of $843,076, capital contributions
and grants of $564,309 and net transfers out of $1,493,208. The net position in the proprietary funds increased
$1,663,169 as a result of the fiscal year’s activities compared to $3,176,710 in the prior year. The unrestricted
net position of the enterprise funds amounted to $13,959,213 at the end of fiscal year 2024 compared to
$14,342,902 at the end of the prior year.
The utility fund experienced a decline in operating income of $154,098 from $2,596,260 in the prior year to
$2,442,162 in the current year. The operating profit as a percentage of operating revenue was 25% in the prior
year and $23% in the current year. The utility fund change in net position declined from $3,732,484 in the prior
year to $2,371,162 in the current year, a deterioration of $1,361,322. This decline was mainly attributed to the
net transfers out in 2024 of $1,383,924 compared to a net transfer in of $332,753 in the prior year. The prior
year was unusually high as ARPA grant funds were transferred to the utility fund to pay for utility fund projects.
Stormwater rates stayed constant in fiscal year 2024 as there were no rate changes. The stormwater fund’s
operating revenue was approximately 59% of the total operating expenses in 2024 compared to 61% for the
prior year.
During fiscal year 2023, the Sanitation Fund netted a decrease in net position of $319,098 due to expenses
and transfer exceed revenue which is similar to the prior year when the fund reported a decrease in net
position of $302,840.
General Fund Budgetary Highlights
Net Budget
The overall net difference from the final budgeted resources (revenues and other financing sources) and adjusted
final budgeted uses (expenditures and other financing uses) was a decrease of $2,208,941. The actual decrease in
fund balance was $225,745. This resulted in a $1,983,196 positive budgetary variance. The budget was amended
during the 2024 fiscal year by increasing budgeted expenditures by $1,110,147. The budget amendments did not
change revenue or other financing sources or uses. The budget was amended to reflect the difference between
the original estimates for the year and actual expenditures incurred.
12
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Continued)
Capital Assets and Debt Administration
Capital Assets―The City’s investment in capital assets, net of related depreciation, for its governmental and
business-type activities as of September 30, 2024, amounted to $87,177,089. This investment in capital assets
includes land, land improvements, land easements, buildings and infrastructure improvements, equipment, and
construction in progress.
The total change in the City’s capital assets, net of related depreciation, for the current fiscal year was an increase
of $4,756,031 or 10% for governmental activities and an increase of $234,352 or 1% for business-type activities.
Capital asset events during the current fiscal year included the following:
▪ Governmental Activities
Buildings reflected a net increase of $519,025 because of additions that exceeded depreciation.
Intangible Assets reflected a net increase of $30,568 because of additions that exceeded depreciation. This
asset category includes land easements and computer software.
Improvements Other Than Buildings reflected a net increase of $3,269,438. This represents capital asset
increase of approximately $4,000,000 offset by depreciation of approximately $725,000.
Equipment reflected a net decrease of $149,563. This represents capital asset additions of approximately
$367,000, offset by depreciation of approximately $516,000.
Construction in progress increased by $6,320 but included current year additions of $2,450,884 and
reductions due to projects placed into service of $2,444,564.
■ Business-type Activities
Buildings reflected a net decrease in asset value of $5,611 from depreciation.
Improvements Other Than Buildings reflected a net decrease of $538,678. This represents capital asset
increases of approximately $1,654,000, offset by depreciation of approximately $2,165,000.
Equipment reflected a net decrease of $112,667. This represents capital asset increase of approximately
$75,000, offset by depreciation of approximately $188,000.
Construction in Progress had a net increase of $891,497 but included $2,112,717 of current year additions
and reductions due to projects placed into service of $1,221,220.
Capital Assets Activity
(net of accumulated depreciation)
as of September 30,
Governmental Activities Business-type Activities Total Primary Government
2024 2023 2024 2023 2024 2023
Land $ 13,171,038 $ 12,090,795 $ 1,656,018 $ 1,656,018 $ 14,827,056 $ 13,746,813
Intangibles 87,504 56,936 212,525 212,714 300,029 269,650
Buildings 7,049,860 6,530,835 5,114 10,725 7,054,974 6,541,560
Improvements - Other 27,466,635 24,197,197 27,359,070 27,897,748 54,825,705 52,094,945
Equipment 859,249 1,008,812 582,393 695,060 1,441,642 1,703,872
Construction in progress 4,323,427 4,317,107 4,404,256 3,512,759 8,727,683 7,829,866
Total $ 52,957,713 $ 48,201,682 $ 34,219,376 $ 33,985,024 $ 87,177,089 $ 82,186,706
13
CITY OF ATLANTIC BEACH, FLORIDA
MANAGEMENT’S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2024
(Concluded)
Additional information on the City’s capital assets can be found in Note 5 of the notes to the financial statements
by referencing the table of contents of this report.
Long-term Debt
At the end of the 2024 fiscal year, the City had total long-term debt outstanding of $7,679,000. The amount of
$6,669,000 represents the City’s debt related to its business type activities. This amount was comprised of debt
secured solely by specified revenue sources. A detailed listing of the City’s debt can be found in the table below.
Long-Term Debt
as of September 30,
Governmental Activities Business-type Activities Total Primary Government
2024 2023 2024 2023 2024 2023
Governmental Activities:
Capital Impvt Rev Bonds, Series 2018 1,010,000 1,095,000 - - 1,010,000 1,095,000
Business-type Activities:
Utilities System Revenue Bond, Series 2014 - - 2,815,000 4,175,000 2,815,000 4,175,000
Refunding Bank Loan, Series 2022 - - 3,854,000 4,309,000 3,854,000 4,309,000
Total $ 1,010,000 $ 1,095,000 $ 6,669,000 $ 8,484,000 $ 7,679,000 $ 9,579,000
Additional information on the City’s long-term debt can be found in Note 6 of the notes to the financial statements
by referencing the table of contents of this report.
Requests for Information
The financial report is designed to provide a general overview of the City’s finances for all those with an interest
in the City’s finances. Questions concerning any of the information provided in this report or requests for
additional financial information should be addressed to the City of Atlantic Beach, Finance Director, 800 Seminole
Road, Atlantic Beach, Florida 32233.
BASIC FINANCIAL STATEMENTS
These basic financial statements contain Government-wide, Fund Financial Statements
and Notes to Financial Statements
See accompanying notes.
14
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF NET POSITION
SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
Primary Government
Governmental Business-type 2023
Activities Activities Total Totals
ASSETS
Equity in pooled cash and investments $ 8,750,951 $ 16,319,689 $ 25,070,640 $ 26,110,833
Receivables, current:
Customer accounts, net 1,264 799,772 801,036 820,318
Intergovernmental and other 1,355,409 - 1,355,409 1,354,116
Notes and leases receivable, net 760 80,037 80,797 54,547
Inventory 109,375 49,872 159,247 144,524
Prepaid expenses 92,628 - 92,628 121,239
Internal balances 534,641 (534,641) - -
Due from fiduciary component unit 1,056,286 - 1,056,286 -
Restricted assets:
Equity in pooled cash and investments 4,671,470 3,144,942 7,816,412 9,944,829
Capital assets:
Non-depreciable 17,494,465 6,060,274 23,554,739 21,576,679
Depreciable, net 35,463,248 28,159,102 63,622,350 60,610,027
Notes and leases receivable, noncurrent 1,520 819,925 821,445 878,658
TOTAL ASSETS 69,532,017 54,898,972 124,430,989 121,615,770
DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows related to pensions 2,308,041 839,197 3,147,238 6,596,245
Deferred outflows - loss on refunding - 107,944 107,944 215,886
Deferred outflows related to OPEB 31,140 11,282 42,422 57,225
TOTAL DEFERRED OUTFLOWS OF RESOURCES 2,339,181 958,423 3,297,604 6,869,356
LIABILITIES
Accounts payable and accrued expenses 1,650,728 1,394,711 3,045,439 2,511,408
Construction costs payable 120,010 146,674 266,684 135,257
Due to other governments - 84,809 84,809 73,730
Unearned revenue 378,003 - 378,003 1,525,038
Accrued interest payable 17,928 54,544 72,472 92,392
Customer deposits 15,896 695,943 711,839 760,163
Long-term obligations:
Due within one year 279,526 1,916,422 2,195,948 2,151,162
Due in more than one year 4,452,393 5,984,985 10,437,378 15,481,757
TOTAL LIABILITIES 6,914,484 10,278,088 17,192,572 22,730,907
DEFERRED INFLOWS OF RESOURCES
Deferred inflows related to pensions 181,876 - 181,876 261,057
Deferred inflows related to OPEB 208,847 75,664 284,511 268,336
Deferred inflows related to leases - 821,233 821,233 894,076
Total deferred inflows of resources 390,723 896,897 1,287,620 1,423,469
NET POSITION
Net investment in capital assets 51,827,703 27,511,646 79,339,349 72,688,335
Restricted for:
General capital projects 106,060 - 106,060 700,811
Public safety 215,181 - 215,181 170,957
Road maintenance and construction 454,111 - 454,111 83,060
Other purposes 460,720 - 460,720 431,731
Substance use prevention and awareness 197,563 - 197,563 122,500
Debt service - 146,551 146,551 151,333
Renewal and replacement - 250,000 250,000 250,000
Utility rate stabilization - 400,000 400,000 400,000
Utility system improvements - 2,319,859 2,319,859 2,057,498
Building code enforcement - 95,141 95,141 191,548
Unrestricted 11,304,653 13,959,213 25,263,866 27,082,977
TOTAL NET POSITION $ 64,565,991 $ 44,682,410 $ 109,248,401 $ 104,330,750
See accompanying notes.
15
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
Program Revenues Net (Expense) Revenue and
Operating Capital Changes in Net Position
Charges for Grant and Grant and Governmental Business-Type 2023
FUNCTIONS/PROGRAMS Expenses Services Contributions Contributions Activities Activities Total Totals
PRIMARY GOVERNMENT:
Governmental activities:
General government $ 3,960,982 $ 249,565 $ 41,751 $ 194,561 $ (3,475,105) $ - $ (3,475,105) $ (3,370,604)
Public safety 7,544,514 790,361 34,652 58,956 (6,660,545) - (6,660,545) (6,673,050)
Transportation 2,664,233 256,757 100,032 269,091 (2,038,353) - (2,038,353) (1,547,423)
Parks and recreation 1,882,586 97,507 - - (1,785,079) - (1,785,079) (1,828,403)
Conservation and resource
management 41,297 - 104,837 - 63,540 - 63,540 58,725
Interest on long-term debt 35,855 - - - (35,855) - (35,855) (38,873)
Total governmental activities 16,129,467 1,394,190 281,272 522,608 (13,931,397) - (13,931,397) (13,399,628)
Business-type activities
Utility 8,207,337 10,379,851 - 487,431 - 2,659,945 2,659,945 2,928,372
Stormwater 1,539,805 902,133 - 42,677 - (594,995) (594,995) (596,991)
Sanitation 2,338,794 2,386,050 - 34,201 - 81,457 81,457 (124,508)
Building code enforcement 580,440 455,466 - - - (124,974) (124,974) (50,519)
Total business-type activities 12,666,376 14,123,500 - 564,309 - 2,021,433 2,021,433 2,156,354
TOTAL PRIMARY GOVERNMENT $ 28,795,843 $ 15,517,690 $ 281,272 $ 1,086,917 $ (13,931,397) $ 2,021,433 $ (11,909,964) $ (11,243,274)
GENERAL REVENUES
Taxes:
Property taxes, levied for general purposes 7,241,664 - 7,241,664 7,224,605
Public service taxes and franchise fees 1,975,611 - 1,975,611 2,073,377
Fuel taxes levied for transportation purposes 887,117 - 887,117 909,382
Discretionary Sales Surtax 1,270,973 - 1,270,973 1,241,724
State shared revenue 2,237,681 - 2,237,681 2,405,210
Grants not restricted to specific programs 1,179,539 - 1,179,539 2,879,280
Investment earnings (loss) 803,534 1,070,115 1,873,649 779,966
Miscellaneous 86,539 64,829 151,368 245,427
Gain (loss) on disposal of capital assets 10,013 - 10,013 13,597
TRANSFERS 1,493,208 (1,493,208) - -
Total general revenues and transfers 17,185,879 (358,264) 16,827,615 17,772,568
CHANGE IN NET POSITION 3,254,482 1,663,169 4,917,651 6,529,294
NET POSITION, beginning of year 61,311,509 43,019,241 104,330,750 97,908,794
Restatement - - - (107,338)
NET POSITION, beginning of year, as restated 61,311,509 43,019,241 104,330,750 97,801,456
NET POSITION, end of year $ 64,565,991 $ 44,682,410 $ 109,248,401 $ 104,330,750
See accompanying notes.
16
CITY OF ATLANTIC BEACH, FLORIDA
BALANCE SHEET – GOVERNMENTAL FUNDS
AS OF SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
2024
American
Rescue Plan
Act Capital Non-Major
General Special Projects Governmental 2023
ASSETS Fund Revenue Fund Fund Funds Total Totals
Equity in pooled cash and investments $ 8,750,951 $ 269,610 $ 3,092,692 $ 1,309,168 $ 13,422,421 $ 17,260,919
Receivables, net
Customer accounts, net 1,264 - - - 1,264 1,304
Intergovernmental and other 962,044 - - 393,365 1,355,409 1,354,116
Notes receivable, current 760 - - - 760 760
Inventory 109,375 - - - 109,375 94,652
Prepaid expenditures 92,628 - - - 92,628 121,239
Due from other funds 2,010,988 - - - 2,010,988 495,710
Notes receivable, non-current 1,520 - - - 1,520 1,520
TOTAL ASSETS $ 11,929,530 $ 269,610 $ 3,092,692 $ 1,702,533 $ 16,994,365 $ 19,330,220
LIABILITIES
Accounts payable and accrued liabilities 821,208 - 822,525 6,995 1,650,728 1,488,840
Construction costs payable 36,115 - 76,550 7,345 120,010 44,307
Due to other funds - - - 420,061 420,061 474,617
Deposits 12,898 - - 2,998 15,896 14,196
Unearned revenue 108,393 269,610 - - 378,003 1,525,038
TOTAL LIABILITIES 978,614 269,610 899,075 437,399 2,584,698 3,546,998
FUND BALANCE
Nonspendable:
Inventory 109,375 - - - 109,375 94,652
Prepaids 92,628 - - - 92,628 121,239
Restricted for:
Public safety - - - 215,181 215,181 170,957
Road maintenance and construction - - - 454,111 454,111 83,060
Capital projects - - - 106,060 106,060 700,811
Other purposes - - - 460,720 460,720 431,731
Substance use prevention and awareness 197,563 - - - 197,563 122,500
Committed to:
Conservation and resource management - - - 325,755 325,755 262,215
Assigned to:
Community redevelopment 50,000 - - - 50,000 50,000
Capital projects - - 2,193,617 - 2,193,617 3,106,371
Operating reserves 4,674,158 - - - 4,674,158 3,691,854
Subsequent year budget 922,251 - - - 922,251 352,820
Unassigned 4,904,941 - - (296,693) 4,608,248 6,595,012
TOTAL FUND BALANCES 10,950,916 - 2,193,617 1,265,134 14,409,667 15,783,222
TOTAL LIABILITIES AND FUND BALANCES $ 11,929,530 $ 269,610 $ 3,092,692 $ 1,702,533 $ 16,994,365 $ 19,330,220
See accompanying notes.
17
CITY OF ATLANTIC BEACH, FLORIDA
RECONCILIATION OF BALANCE SHEET OF GOVENRMENTAL FUNDS TO THE STATEMENT OF NET POSITION
SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
Amounts reported for governmental activities in the statement of net position
are different because:
2024 2023
FUND BALANCES - TOTAL GOVERNMENTAL FUNDS $ 14,409,667 $ 15,783,222
Capital assets used in governmental activities are not financial
resources and, therefore, are not reported in the governmental funds. 52,957,713 48,201,682
Deferred outflows of resources represent an consumption of net position or
fund balance that applies to a future period(s) and, therefore, are not
reported in the governmental funds. 2,339,181 5,181,216
Deferred inflows of resources represent an increase in net position or
fund balance that applies to a future period(s) and, therefore, are not
reported in the governmental funds. (390,723) (456,532)
Interest payable on long-term debt does not require current financial resources
and therefore, is not reported as a liability in governmental funds. (17,928) (19,436)
Long-term liabilities (including bonds and notes payable, compensated
absences liability, OPEB obligation, and net pension liabilities)
are not due and payable in the current period and, therefore, are not
reported in the governmental funds.
This is the amount of the long-term obligations (4,731,919) (7,378,643)
NET POSITION OF GOVERNMENTAL ACTIVITIES $ 64,565,991 $ 61,311,509
See accompanying notes.
18
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
American
Rescue Plan
Act Capital Non-major
General Special Projects Governmental 2023
Fund Revenue Fund Fund Funds Total Totals
REVENUES:
Property taxes $ 7,241,664 $ - $ - $ - $ 7,241,664 $ 7,224,605
Non-property taxes 1,205,393 - - 2,158,090 3,363,483 3,459,524
Licenses and permits 940,102 - - - 940,102 1,093,728
Intergovernmental revenue 2,573,445 1,179,538 - 328,047 4,081,030 5,594,484
Charges for services 999,959 - - 94,491 1,094,450 1,177,576
Fines and forfeitures 122,277 - - 146,694 268,971 234,554
Investment earnings (loss) 588,083 - 204,946 10,506 803,535 367,890
Miscellaneous revenues 88,500 - - 375 88,875 202,354
Total revenues 13,759,423 1,179,538 204,946 2,738,203 17,882,110 19,354,715
EXPENDITURES:
General government 3,772,977 - - 41,297 3,814,274 3,420,935
Public safety 7,203,355 - 99,295 31,318 7,333,968 7,340,227
Transportation 1,790,336 - - - 1,790,336 1,753,398
Culture/recreation 1,365,731 - - - 1,365,731 1,529,465
Capital outlay 1,493,989 - 4,449,970 386,873 6,330,832 4,311,192
Debt service - - - 122,364 122,364 120,291
Total expenditures 15,626,388 - 4,549,265 581,852 20,757,505 18,475,508
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,866,965) 1,179,538 (4,344,319) 2,156,351 (2,875,395) 879,207
OTHER FINANCING SOURCES (USES)
Transfers in 1,892,436 - 2,730,754 275,064 4,898,254 4,894,172
Transfers (out) (259,848) (1,179,538) - (1,965,660) (3,405,046) (5,427,147)
Sale of general capital assets 8,632 - - - 8,632 12,013
TOTAL OTHER FINANCING SOURCES (USES) 1,641,220 (1,179,538) 2,730,754 (1,690,596) 1,501,840 (520,962)
NET CHANGE IN FUND BALANCE (225,745) - (1,613,565) 465,755 (1,373,555) 358,245
FUND BALANCE, beginning of year 11,176,661 - 3,807,182 799,379 15,783,222 15,424,977
FUND BALANCE, end of year $ 10,950,916 $ - $ 2,193,617 $ 1,265,134 $ 14,409,667 $ 15,783,222
See accompanying notes.
19
CITY OF ATLANTIC BEACH, FLORIDA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
Amounts reported for governmental activities in the statement of net activities
are different because:
2024 2023
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS $ (1,373,555) $ 358,245
Governmental funds report capital outlay as expenditures. However,
in the statement of activities, the cost of these assets is allocated over
their estimated useful lives and reported as depreciation expense.
This is the amount of capital assets recorded in the current period. 6,211,453 4,425,192
This is the amount of depreciation recorded in the current period. (1,448,273) (1,558,589)
This is the book value of dispositions recorded in the current period. (7,149) (138,454)
Long-term obligations including bonds and notes payable, compensated absences
and other post-employment benefit obligations are reported as liabilities in the
government-wide statement of net position but are not reported as liabilities in the
governmental funds because they do not require the use of current financial resources:
This is the repayment of bond principal reported as expenditures in governmental funds. 85,000 80,000
This is the change in accrued interest payable on long-term obligations. 1,508 1,420
This is the change in accrued compensated absences during the year. 65,938 (28,572)
Other postemployment benefit (OPEB) expense is reported in the statement of activities
which differs from OPEB expenditures as report in the governmental funds:
This amount represents the change in deferred inflows related to OPEB. (13,372) (26,055)
This amount represents the change in deferred outflows related to OPEB. (10,547) (2,291)
This amount represents the change in the total OPEB liability. 27,505 21,844
Pension expense is reported in the statement of activities which differs from
pension expenditures as reported in the governmental finds:
This amount represents the change in deferred inflows related to pensions. 79,181 3,131,758
This amount represents the change in deferred outflows related to pensions. (2,831,488) 3,430,287
This amount represents the change in the net pension liability(asset). 2,468,281 (6,342,201)
CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES $ 3,254,482 $ 3,352,584
See accompanying notes.
20
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF NET POSITION – PROPRIETARY FUNDS
SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Totals Totals
ASSETS
Current assets:
Equity in pooled cash and investments $ 15,473,846 $ 611,142 $ - $ 234,701 $ 16,319,689 $ 15,911,595
Accounts receivables, net 640,098 51,984 107,690 - 799,772 819,014
Leases receivable - current 80,037 - - - 80,037 53,787
Inventory 49,872 - - - 49,872 49,872
Total current assets 16,243,853 663,126 107,690 234,701 17,249,370 16,834,268
Noncurrent assets:
Leases receivable - noncurrent 819,925 - - - 819,925 877,138
Restricted assets:
Equity in pooled cash and investments 3,144,942 - - - 3,144,942 2,883,148
Capital assets:
Non-depreciable 4,752,161 1,308,113 - - 6,060,274 5,168,777
Depreciable, net 21,397,859 6,628,512 112,296 20,435 28,159,102 28,816,247
Total noncurrent assets 30,114,887 7,936,625 112,296 20,435 38,184,243 37,745,310
Total assets 46,358,740 8,599,751 219,986 255,136 55,433,613 54,579,578
DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows related to pensions 612,334 41,232 82,493 103,138 839,197 1,456,716
Deferred outflows - refunding loss 93,911 14,033 - - 107,944 215,886
Deferred outflows related to OPEB 8,219 1,417 - 1,646 11,282 15,538
Total deferred outflows of resources 714,464 56,682 82,493 104,784 958,423 1,688,140
Continued…
See accompanying notes.
21
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF NET POSITION – PROPRIETARY FUNDS (concluded)
SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Totals Totals
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities $ 855,032 $ 344,456 $ 173,619 $ 21,604 $ 1,394,711 $ 1,022,568
Construction costs payable 100,802 45,872 - - 146,674 90,950
Due to other governments 10,192 - - 74,617 84,809 73,730
Due to other funds - - 534,641 - 534,641 21,093
Compensated absences 55,558 3,483 - 6,381 65,422 68,463
Bonds and notes payable, current 1,670,300 180,700 - - 1,851,000 1,815,000
Total current liabilities 2,691,884 574,511 708,260 102,602 4,077,257 3,091,804
Noncurrent liabilities:
Liabilities payable from restricted assets:
Customer deposits 695,943 - - - 695,943 745,967
Interest payable 50,281 4,263 - - 54,544 72,956
Compensated absences 209,479 16,696 - 14,954 241,129 263,017
Other postemployment obligation payable 61,909 10,672 - 12,402 84,983 97,683
Net pension liability 613,557 41,314 82,658 103,344 840,873 1,341,113
Bonds and notes payable, noncurrent portion 4,632,750 185,250 - - 4,818,000 6,669,000
Total noncurrent liabilities 6,263,919 258,195 82,658 130,700 6,735,472 9,189,736
Total liabilities 8,955,803 832,706 790,918 233,302 10,812,729 12,281,540
DEFERRED INFLOWS OF RESOURCES
Deferred inflows related to OPEB 55,120 9,502 - 11,042 75,664 72,861
Deferred inflows related to leases 821,233 - - - 821,233 894,076
Total deferred inflows of resources 876,353 9,502 - 11,042 896,897 966,937
NET POSITION
Net investment in capital assets 19,840,079 7,538,836 112,296 20,435 27,511,646 25,625,960
Restricted for:
Debt retirement 146,551 - - - 146,551 151,333
Renewal and replacement 250,000 - - - 250,000 250,000
Utility rate stabilization 400,000 - - - 400,000 400,000
Utility system improvements (expendable) 2,319,859 - - - 2,319,859 2,057,498
Building code enforcement - - - 95,141 95,141 191,548
Unrestricted 14,284,559 275,389 (600,735) - 13,959,213 14,342,902
Total net position $ 37,241,048 $ 7,814,225 $ (488,439) $ 115,576 $ 44,682,410 $ 43,019,241
See accompanying notes.
22
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION – PROPRIETARY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Totals Total
OPERATING REVENUES:
Charges for services
Customer charges $ 10,367,256 $ 902,133 $ 2,385,711 $ 455,466 $ 14,110,566 $ 13,908,937
Franchise permits - - - - - 647
Miscellaneous revenues 64,829 - - - 64,829 75,304
Total operating income 10,432,085 902,133 2,385,711 455,466 14,175,395 13,984,888
OPERATING EXPENSES:
Personnel services 2,295,544 365,269 82,984 350,325 3,094,122 2,981,390
Contractual services 892,387 183,998 2,080,205 83,164 3,239,754 3,128,127
Supplies 529,113 70,255 - 2,639 602,007 547,376
Repairs and maintenance 509,257 1,179 7,373 27,197 545,006 776,382
Utilities 383,890 - - - 383,890 400,159
Depreciation 1,797,339 522,707 23,836 14,365 2,358,247 2,392,811
Intergovernmental charges 1,112,796 317,772 140,928 90,216 1,661,712 1,661,982
Other expenses 469,597 56,066 3,468 12,534 541,665 366,991
Total operating expenses 7,989,923 1,517,246 2,338,794 580,440 12,426,403 12,255,218
OPERATING INCOME (LOSS) 2,442,162 (615,113) 46,917 (124,974) 1,748,992 1,729,670
NONOPERATING REVENUE (EXPENSE)
Connection charges 12,595 - - - 12,595 37,806
Franchise fees - - 339 - 339 49,035
Investment earnings (loss) 1,030,312 25,601 - 14,202 1,070,115 412,077
Interest expense (219,514) (22,559) - - (242,073) (281,330)
Other, net 2,100 - - - 2,100 6,300
Total nonoperating revenues (expense) 825,493 3,042 339 14,202 843,076 223,888
Continued…
See accompanying notes.
23
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION – PROPRIETARY FUNDS (concluded)
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Totals Total
INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS $ 3,267,655 $ (612,071) $ 47,256 $ (110,772) $ 2,592,068 $ 1,953,558
CAPITAL CONTRIBUTIONS
System development charges 194,636 - - - 194,636 168,455
Capital grants and contributions 292,795 42,677 34,201 - 369,673 521,722
Total capital contributions 487,431 42,677 34,201 - 564,309 690,177
TRANSFERS
Transfers in - 250,296 - - 250,296 1,896,676
Transfers out (1,383,924) - (359,580) - (1,743,504) (1,363,701)
Total transfers (1,383,924) 250,296 (359,580) - (1,493,208) 532,975
CHANGE IN NET POSITION 2,371,162 (319,098) (278,123) (110,772) 1,663,169 3,176,710
NET POSITION, beginning of year, as previously reported 34,869,886 8,133,323 (210,316) 226,348 43,019,241 39,949,869
Restatement - - - - - (107,338)
NET POSITION, beginning of year, as restated 34,869,886 8,133,323 (210,316) 226,348 43,019,241 39,842,531
NET POSITION, end of year $ 37,241,048 $ 7,814,225 $ (488,439) $ 115,576 $ 44,682,410 $ 43,019,241
See accompanying notes.
24
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Total Totals
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers $ 10,426,529 $ 889,702 $ 2,331,036 $ 466,083 $ 14,113,350 $ 13,943,705
Payments to suppliers (3,609,205) (341,450) (2,448,088) (212,878) (6,611,621) (6,795,075)
Payments for salaries and benefits (2,222,605) (358,212) (71,456) (344,948) (2,997,221) (3,027,571)
Net cash flows from operating activities 4,594,719 190,040 (188,508) (91,743) 4,504,508 4,121,059
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Transfers to other funds (1,383,924) - (359,580) - (1,743,504) (1,363,701)
Transfers from other funds - 250,296 - - 250,296 1,896,676
Cash received (paid) from/to other funds - - 513,548 - 513,548 (565,353)
Connection charges received 12,595 - - - 12,595 37,806
Franchise fees received - - 339 - 339 49,035
Net cash flows from noncapital financing activities (1,371,329) 250,296 154,307 - (966,726) 54,463
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of capital assets, net of related payables (2,306,433) (230,442) - - (2,536,875) (3,537,654)
Principal paid on notes, bonds and lease obligations (1,638,200) (176,800) - - (1,815,000) (1,777,000)
Interest paid on borrowings and other debt costs (141,956) (10,587) - - (152,543) (191,404)
Capital contributions and impact fees received,
net of change in related receivables 487,431 42,677 34,201 - 564,309 690,177
Net cash flows from capital and related financing activities (3,599,158) (375,152) 34,201 - (3,940,109) (4,815,881)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest on invested funds 1,030,312 25,601 - 14,202 1,070,115 412,077
Other income 2,100 - - - 2,100 (57,479)
Net cash flows from investing activities 1,032,412 25,601 - 14,202 1,072,215 354,598
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 656,644 90,785 - (77,541) 669,888 (285,761)
CASH AND CASH EQUIVALENTS, beginning of year 17,962,144 520,357 - 312,242 18,794,743 19,080,504
CASH AND CASH EQUIVALENTS, end of year $ 18,618,788 $ 611,142 $ - $ 234,701 $ 19,464,631 $ 18,794,743
As shown in the Accompanying Financial Statements
Equity in cash and investments $ 15,473,846 $ 611,142 $ - $ 234,701 $ 16,319,689 $ 15,911,595
Restricted equity in cash and investments 3,144,942 - - - 3,144,942 2,883,148
Total cash and cash equivalents $ 18,618,788 $ 611,142 $ - $ 234,701 $ 19,464,631 $ 18,794,743
Noncash financing and investing activities:
Amortization of refunding loss $ 93,910 $ 14,032 $ - $ - $ 107,942 $ 107,943
Donated Infrastructure - - - - - 63,779
Total noncash financing and investing activities $ 93,910 $ 14,032 $ - $ - $ 107,942 $ 171,722
Continued…
See accompanying notes.
25
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF CASH FLOWS (concluded)
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Business Type Activities - Enterprise Funds
(non-major)
Building Code 2023
Utility Stormwater Sanitation Enforcement Total Totals
Reconciliation of operating income (loss) to net cash
provided (used) by operating activities:
Operating income (loss) $ 2,442,162 $ (615,113) $ 46,917 $ (124,974) $ 1,748,992 $ 1,729,670
Adjustments to reconcile operating income to net
cash provided (used) by operating activities:
Depreciation expense 1,797,339 522,707 23,836 14,365 2,358,247 2,392,811
(Increase) decrease in accounts receivable 86,348 (12,431) (54,675) - 19,242 (35,575)
(Increase) decrease in leases receivable 30,963 - - - 30,963 50,503
Increase (decrease) in lease related deferred inflows (72,843) - - - (72,843) (72,843)
(Increase) decrease in amounts due from other governments - - - 10,617 10,617 12,020
Increase (decrease) in accounts payable 297,565 287,820 (216,114) 2,872 372,143 96,618
Increase (decrease) in compensated absences (9,226) 3,255 - (8,766) (14,737) (22,969)
Increase (decrease) in amounts due to other governments (9,730) - - - (9,730) (10,676)
Increase (decrease) in customer deposits (50,024) - - - (50,024) 4,712
(Increase) decrease in OPEB related deferred outflows 3,030 660 - 566 4,256 1,198
Increase (decrease) in the total OPEB liability (8,812) (2,385) - (1,503) (12,700) (10,360)
Increase (decrease) in OPEB related deferred inflows 2,370 (237) - 670 2,803 8,388
(Increase) decrease in pension related deferred outflows 450,612 30,363 60,697 75,847 617,519 (1,023,865)
Increase (decrease) in the net pension liability (365,035) (24,599) (49,169) (61,437) (500,240) 1,341,113
(Increase) decrease in the net pension asset - - - - - 590,793
Increase (decrease) in pension related deferred inflows - - - - - (930,479)
Net cash flows from operating activities $ 4,594,719 $ 190,040 $ (188,508) $ (91,743) $ 4,504,508 $ 4,121,059
See accompanying notes.
26
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2023
Pension Trust
Funds
ASSETS 2024 2023
Cash and cash equivalents $ 648,347 $ 828,906
Accrued income 98,357 89,333
Investments at fair value 47,692,750 39,220,515
Total assets 48,439,454 40,138,754
LIABILITIES
Accounts payable and accrued liabilities 32,344 3,151
Due to City 1,056,286 -
Total Liabilities 1,088,630 3,151
NET POSITION
Restricted for pension benefits $ 47,350,824 $ 40,135,603
See accompanying notes.
27
CITY OF ATLANTIC BEACH, FLORIDA
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
Pension Trust
Funds
2024 2023
ADDITIONS
Contributions:
City $ 1,140,496 $ 1,408,617
Plan members 288,232 291,159
State of Florida - 165,133
Total contributions 1,428,728 1,864,909
Investment income 8,709,711 4,823,653
Less investment expenses: (155,193) (142,997)
Net investment income 8,554,518 4,680,656
Total additions 9,983,246 6,545,565
DEDUCTIONS
Administrative expenses 132,957 62,858
Payments to retirees and participants 2,635,068 2,738,677
Total deductions 2,768,025 2,801,535
CHANGE IN NET POSITION 7,215,221 3,744,030
NET POSITION, beginning of year 40,135,603 36,391,573
NET POSITION, end of year $ 47,350,824 $ 40,135,603
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
28
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the City of Atlantic Beach, Florida, (the City), conform to accounting principles generally
accepted in the United States of America as applicable to governments. The following is a summary of the more
significant policies used in the preparation of these financial statements:
Reporting Entity
The City was incorporated in 1957, under a charter in accordance with the laws of the State of Florida, Florida
Statutes Section 57-1126. The City operates under a form of government, which comprises an elected City
Commission (four Commissioners and a Mayor-Commissioner) and provides, under the administration of an
appointed City Manager, the following services: public safety, public works (streets and infrastructure), recreation,
conservation and resource management, sanitation, stormwater, reuse, plann ing, zoning, water and sewer, and
general government services.
In accordance with the Codification of Governmental and Financial Reporting Standards, the financial reporting
entity consists of the primary government, organizations for which the primary government is financially
accountable, and other organizations who se exclusions would cause the reporting entity’s financial statements to
be misleading or incomplete. The Governmental Accounting Standards Board (GASB) has set forth criteria for
consideration in determining financial accountability. These criteria incl ude appointing a majority of an
organization’s governing body and: (1) the ability of the City to impose its will on that organization; or (2) the
potential for that organization to provide specific benefits to or impose specific financial burdens on the City. Other
considerations are whether the organization is legally separate, whether the City holds the corporate powers of the
organization, and whether there is fiscal dependency by the organization on the City. Based upon the application of
these criteria, the City reports the following fiduciary component units:
• General Employees’ Retirement Plan
• Police Officers’ Retirement Plan
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of activities) report
information on all of the non-fiduciary activities of the City. For the most part, the effect of inter -fund activity has
been removed from these statements. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent
on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is
offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or activity.
Indirect costs are included in the program expense reported for individual functions and activities. 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 activity; and (2) grants and contributions that are restricted to meeting
the operational or capital requirements of a particular function or activity. Taxes and other items not properly
included among program revenues are reported instead as general revenues.
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.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
29
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (cont…)
Government-Wide 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.
As a general rule, the effect of inter-fund activity has been eliminated from the government -wide financial
statements. The major exception to this general rule is charges between the City’s water and sewer function and
various other functions of the City. Elimination of these charges would distort the direct costs and program revenues
reported for the various functions concerned.
Amounts reported as program revenues include: (1) charges to customers or applicants for goods, services, or
privileges provided; (2) operating grants and contributions; and (3) capital grants and contributions, including special
assessments. General revenues include all taxes.
Net position is reported as one of three categories: (1) Net Investment in Capital Assets; (2) Restricted; or (3)
Unrestricted.
Fund Financial Statements
Governmental fund financial statements are reported using the current financial resources measurement focus and
the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and
available. Revenues are considered to be available when they are collectible within the current period or soon
enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to
be available if they are collected within sixty days of the end of the current fiscal period. Expenditures generally are
recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as
expenditures related to compensated absences, other postemployment benefits, pensio n expense, and claims and
judgments, are recorded only when payment is due.
Taxes, intergovernmental revenue, licenses and permits, charges for services, and interest associated with the
current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the
current fiscal period. All other revenue items are considered to be measurable and available only when cash is
received by the City.
The City reports the following major governmental funds:
• The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general
government, except those required to be accounted for in another fund.
• The American Rescue Plan Act (ARPA) Special Revenue Fund is used to account for the receipt and
expenditure of ARPA funding to support the City’s recovery from the COVID-19 pandemic. While this fund
does not meet the technical criteria to be reported as a major fund, to remain consistent and provide
transparency, the City has elected to report this fund as major until all funds received into this fund have
been utilized.
• The Capital Projects Fund is used to account for the financial resources to be used for the acquisition or
construction of major capital facilities and improvement projects (other than those financed by proprietary
funds).
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
30
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (cont…)
The City reports the following major proprietary funds:
• The Utility Fund accounts for the activities of the City’s water distribution, sewer collection and treatment
systems, and reuse system.
• The Sanitation Fund accounts for the activities of the City’s sanitation system.
• The Stormwater Fund accounts for the activities of the City’s stormwater system.
Additionally, the City reports the following fund types:
• Special Revenue Funds—The special revenue funds are used to account for the proceeds of specific revenue
sources (other than major capital projects) that are legally restricted to expenditures for specified purposes.
• Debt Service Fund – The debt service fund is used to account for the accumulation of resources for, and
payment of, general long-term debt principal, interest and related costs.
• Pension Trust Funds—These funds account for the activities of the Employees’ Retirement System, which
accumulates resources for pension benefit payments to qualified police officers and general employees.
Fund Balance Classification
Fund Balance is reported in five components – non-spendable, restricted, committed, assigned, and unassigned:
• Non-Spendable Fund Balance—amounts that are not in spendable form (such as inventory) or are required
to be maintained intact.
• Restricted Fund Balance—amounts constrained to specific purposes by their providers (such as grantors,
bondholders, and higher levels of government), through constitutional provisions, or by enabling
legislation.
• Committed Fund Balance—amounts constrained to specific purposes by the City itself, using its highest
level of decision-making authority (i.e., ordinance passed by City Commission). To be reported as
committed, amounts cannot be used for any other purpose unless the City takes the same highest level
action to remove or change the constraint.
• Assigned Fund Balance—amounts the City intends to use for a specific purpose. Intent can be expressed
by the City Commission or by an official or body to which the City Commission delegates the authority.
• Unassigned Fund Balance—amounts that are available for any purpose. Positive amounts are reported
only in the General Fund.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
31
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (concluded)
When both restricted and unrestricted resources are available for use, it is the City’s practice to use restricted
resources first, then unrestricted resources as they are needed. When unrestricted resources (committed, assigned,
and unassigned) are available for use in any governmental fund, it is the City’s practice to use committed resources
first, then assigned, and then unassigned as needed.
The City Commission establishes (and modifies or rescinds) fund balance commitments by passage of an ordinance.
This is typically done through adoption and amendment of the budget. A fund balance commitment is further
indicated in the budget document as a designation or commitment of the fund. Assigned fund balance is established
by City Commission through adoption or amendment of the budget as intended for specific purpose (such as the
purchase of fixed assets, construction, debt service, or for other purposes).
In the General Fund, the City strives to maintain a fund balance operating reserve of approximately 25% of the
subsequent year’s budgeted General Fund payroll and operating expenditures.
Proprietary Funds
Proprietary funds distinguish operating revenues and expenses from non -operating items. Operating revenues and
expenses generally result from providing services and producing and delivering goods in connection with a
proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s enterprise funds are
charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and
services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this
definition are reported as non-operating revenues and expenses.
Budgets
General governmental revenue and expenditures accounted for in budgetary funds are controlled by a budgetary
accounting system in accordance with various legal requirements which govern the City’s operations. Budgets are
monitored at varying levels of classification detail; however, expenditures cannot legally exceed total appropriations
at the individual fund level.
Budgets are adopted for all governmental funds (general, special revenue, and capital projects). The City Manager
is authorized to transfer budgeted amounts within departments within any fund; however, any revisions that
increase the total expenditures of any department or fund must be approved by the City Commission. All necessary
supplemental appropriations are adopted by the City Commission and are included in the reported budgetary data.
The budget presented in the accompanying required supplemental information is prepared in conformity with
accounting principles generally accepted in the United States of America.
Cash and Investments
Except where prohibited, cash resources of the individual funds are combined to form a pool of cash and
investments. These pooled cash, investments and related accrued investment earnings are reported in the financial
statements as “Equity in pooled cash and investments” under the City’s “pooling” concept (see Note 2). Investment
earnings and losses on the pooled cash and investments are distributed to the appropriate funds based on the
average monthly balance of investments in each fund.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
32
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
The proprietary funds use this pool as a demand deposit accounts, and accordingly, all amounts in the pool are
considered cash and cash equivalents for the purposes of the statement of cash flows.
Investments are valued at fair market value (see Note 2).
Receivables
Receivables are recorded at their net realizable value.
Inter-Fund Receivables and Payables
Activity 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 inter -fund loans) or
“advances to/from other funds” (i.e., the non-current portion of inter-fund loans).
Inventories
Inventories consisting principally of expendable materials, supplies, and fuel are determined by physical count at the
City’s year-end on an annual basis and are valued at the lower of cost (first -in, first-out) or market. On the balance
sheet - governmental funds, the inventory balance reported is considered non-spendable fund balance, which
indicates that it does not constitute “available spendable resources” even though it is a component of net current
assets. The cost of governmental fund-type inventories is recorded as expenditure when consumed.
Restricted Assets
Certain enterprise fund assets are required to be segregated from other current assets due to various bond indenture
agreements and City ordinances. These assets are legally restricted for specific purposes, such as debt service, new
construction, and renewals and replacements.
Use of Restricted Funds
When both restricted and unrestricted resources are available for use in the City’s funds, it is the City’s policy to use
restricted resources first, then unrestricted resources as they are needed.
Capital Assets
Capital assets, which include property, plant and equipment, and infrastructure assets (e.g., roads, drainage
improvements, sidewalks, and similar items), are reported in the applicable governmental or business -type activities
columns in the government-wide financial statements. Property, plant and equipment with initial, individual costs
that equal or exceed $1,000 and estimated useful lives of over one year are recorded as capital assets. Capital assets
are recorded at historical cost or estimated histo rical cost if purchased or constructed. Donated capital assets are
recorded at estimated acquisition value at the date of donation.
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 is included as part of the capitalized value
of the assets constructed.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets’
lives are not capitalized.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
33
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
Property, plant and equipment are depreciated using the straight -line method over the following estimated useful
lives:
Assets Years
Buildings and Improvements 10-40
Improvements Other Than Buildings 10-50
Infrastructure 25-100
Machinery and Equipment 3-40
Long-Term Obligations
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 type statement of net position. Bond premiums, discounts, and refunding losses
are deferred and amortized over the life of the bonds using the effective interest method. Bond issuance costs are
expensed when incurred with the exception of bond insurance, which is amortized over the term of the related debt.
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.
Compensated Absences
Accumulated unpaid vacation and sick pay are accrued when incurred in the government-wide and proprietary fund
financial statements.
Deferred Inflows/Outflows of Resources
Deferred inflows of resources reported on applicable governmental fund types represent revenues, which are
measurable but not available in accordance with the modified accrual basis of accounting. The deferred inflows will
be recognized as revenue in the fiscal year they are earned or become available. Deferred outflows of resources
represent consumption of net assets that is applicable to a future reporting period. Deferred outflows have a
positive effect on net position, similar to assets. Deferred inflows of resources represent the acquisition of net assets
that is applicable to a future reporting period. Deferred inflows have a negative effect on net position, similar to
liabilities.
Unamortized Refunding Loss—the difference between the net reacquisition cost of new debt and the net carrying
amount of the old debt is recorded as a deferred outflow of resources. The unamortized refunding loss is recognized
as expense over the remaining term of the new debt using the straight-line method.
Pension and OPEB Related—the difference between expected and actual experience with regard to economic or
demographic factors and changes to assumptions in the measurement of total pension and OPEB liability and the
differences between expected and actual earnings on pension plan investments, are reported as deferred inflows or
outflows of resources, to be recognized in expense in future years. Contributions made subsequent to the
measurement date, but prior to the reporting date, are reported as deferred o utflows of resources.
Lease related – represents the total unrecognized revenue to be received from the City’s antenna placement leases.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
34
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
Revenue Recognition
Utility revenues are reported on the accrual basis in the accompanying financial statements. Grant revenues are
recorded using the modified accrual basis in governmental funds and the accrual basis in the proprietary funds.
Restricted grant revenues, which are received but not expended, are recorded as unearned revenues.
Property Taxes
The assessment of all properties and the collection of all property taxes are made through the Property Appraiser
and Tax Collector of the City of Jacksonville, Florida. General property taxes are recorded as received, in cash, which
approximates taxes levied less discounts for the current fiscal year.
Taxes are levied on November 1 of each year. All taxes become delinquent on April 1 of the following year. Discounts
are allowed for early payment. On or prior to June 1, interest -bearing certificates are sold for all uncollected real
property taxes. Unsold certificates are held by the City of Jacksonville, Florida.
Inter-Fund Transactions
During the course of normal operations, the City has various transactions between funds to construct assets and
comply with local ordinances and other legal restrictions. These transactions are reflected as transfers. In addition,
certain transfers have been made between systems and accounts of the utility enterprise fund as required by bond
covenants.
Prior Period Information
The financial statements include certain prior year summarized comparative information in total. Such information
does not include sufficient detail to constitute a presentation in conformity with generally accepted accounting
principles. Accordingly, such information should be read in conjunction with the City’s financial statements for the
year ended September 30, 2023, from which the summarized information was derived.
Leases:
Lessee: The City recognizes a lease liability and an intangible right-to-use lease asset (lease asset) in the government-
wide financial statements when the initial value of the lease liability is deemed to be material. For the year ended
September 30, 2024, the City reports no right-to-use lease assets or lease liabilities.
At the commencement of a lease, the City initially measures the lease liability at the present value of payments
expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion
of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for
lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the
lease asset is amortized on a straight‐line basis over its useful life.
Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to
discount the expected lease payments to present value, (2) lease term, and (3) lease payments.
• The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged
by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the
discount rate for leases.
• The lease term includes the noncancellable period of the lease. Lease payments included in the
measurement of the lease liability are composed of fixed payments and purchase option price that the City
is reasonably certain to exercise.
Lease assets are reported with other capital assets and lease liabilities are reported with long‐term debt on the
statement of net position.
Lessor: The City is a lessor for several noncancellable antenna placement leases. The City recognizes a lease
receivable and a deferred inflow of resources in the business-type activities and the enterprise fund financial
statements.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
35
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont…)
At the commencement of a lease, the City initially measures the lease receivable at the present value of payments
expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal
portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of
the lease receivable, adjusted for lease payments received at or before the lease commencement date.
Subsequently, the deferred inflow of resources is recognized as revenu e over the life of the lease term.
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the
expected lease receipts to present value, (2) lease term, and (3) lease receipts.
• The City uses the stated interest rate in the lease agreement if available and if not, utilizes a high-quality
municipal bond rate based on the S&P Municipal Bond 20 Year High Grade Rate Index as published by S&P
Dow Jones Indices nearest to the date of lease commencement.
• The lease term includes the noncancellable period of the lease. Lease receipts included in the measurement
of the lease receivable are composed of fixed payments from the lessee.
The City monitors changes in circumstances that would require a remeasurement of its leases and will remeasure
the lease asset, receivable, liability and/or deferred inflows of resources if certain changes occur that are expected
to significantly affect the amount of the lease liability.
Implementation of New GASB Pronouncements
During the fiscal year ended September 30, 2024, the City implemented the provisions of GASB Statement No. 100
– Accounting Changes and Error Corrections – An Amendment of GASB Statement No. 62. The primary objective of
this Statement is to enhance accounting and financial reporting requirements for accounting changes and error
corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making
decisions or assessing accountability.
Future GASB Pronouncement Implementations
The City is currently evaluating the effects that the following GASB Statements, which will be implemented in future
financial statements, will have on its financial statements for subsequent fiscal years:
• Statement No. 101, “Compensated Absences.”
The objective of this Statement is to better meet the information needs of financial statement users by updating
the recognition and measurement guidance for compensated absences. That objective is achieved by aligning
the recognition and measurement guidance under a unified model and by amending certain previously required
disclosures. This statement is effective for the 2025 fiscal year and will be evaluated in the future closer to the
implementation period.
• Statement No. 102, “Certain Risk Disclosures.”
The objective of this Statement is to provide users of government financial statements with essential
information about risks related to a government’s vulnerabilities due to certain concentrations or constraints.
This statement is effective for the 2025 fiscal year and will result in additional financial statement disclosures.
• Statement No. 103, “Financial Reporting Model Improvements.”
The objective of this Statement is to improve key components of the financial reporting model to enhance its
effectiveness in providing information that is essential for decision making and assessing a government’s
accountability. This statement is effective for the 2026 fiscal year and will be evaluated in the future closer to
the implementation period.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
36
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded)
• Statement No. 104, “Disclosure of Certain Capital Assets.”
The objective of this Statement is to provide users of government financial statements with essential
information about certain types of capital assets. This statement is effective for the 2026 fiscal year and will
result in expanded financial statement disclosures, but the changes are not expected to be significant.
NOTE 2 – CASH AND INVESTMENTS
The City maintains a cash and investment pool that is designed for use by all funds, except for those monies which
are periodically transferred for pension investment purposes. In addition, investments are separately held and
individually accounted for where contractual arrangements and bond covenants provide for and require such
arrangements.
On September 30, 2024, the carrying amount of cash on hand and on deposit with banks, including interest -bearing
deposits was $6,602,246 and the related bank balance was $6,860,618. Monies which are placed on deposit with
financial institutions in the form of demand deposit accounts, time deposit accounts, and certificates of deposit are
defined as public deposits. All of the City’s public deposits are held in qualified public depo sitories pursuant to
Florida Statutes Chapter 280, Florida Security for Public Deposits Act (the Act). Under the Act, all qualified public
depositories are required to pledge eligible collateral having a market value equal to or greater than the average
daily or monthly balance of all public deposits, times the depository’s coll ateral pledged level. The pledging level
may range from 25% to 125% depending upon the depository’s financial condition and establishment period. All
collateral must be deposited with an approved financial institution.
Any losses to public depositors are covered by applicable deposit insurance, sale of securities pledged as collateral
and, if necessary, assessments against other qualified public depositories of the same type as the depository in
default.
The City elected to adopt a written investment policy as authorized under Florida Statutes.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
37
NOTE 2 – CASH AND INVESTMENTS (cont…)
Under the City’s investment policies, general investments’ activities are authorized to invest in obligations of the
U.S. Treasury, demand deposits, U.S. government agency securities, certificates of deposit, U.S. government
sponsored enterprises, government and corporate fixed income mutual funds, corporate notes and bonds, and local
government investment pools. Pension trust funds can invest in the aforementioned and, additionally, authorized
investments include domestic and foreign equity securities, do mestic and foreign fixed income securities, and cash
equivalent securities.
Following are the investments, credit ratings, and maturities of the City’s governmental and business -type activities
on September 30, 2024:
Investment Maturities
Fair Less than 1-5 6-10 More than
Investment Type Value 1 Year Years Years 10 Years Total
Accrued interest $ 230,124 $ 230,124 $ - $ - $ - 230,124
Money market funds / cash 95,021 95,021 - - - 95,021
Corporate bonds 9,403,545 2,295,353 7,013,805 94,387 - 9,403,545
U.S. Treasury Obligations and
Federal Agency Securities 17,183,500 - 16,694,251 489,249 - 17,183,500
Florida PRIME 25,991 25,991 - - - 25,991
Total $ 26,938,181 $ 2,646,489 $ 23,708,056 $ 583,636 $ - $ 26,938,181
The Florida PRIME component of the cash and investments is an investment in an investment pool administered by
the State Board of Administration, under the regulatory oversight of the State of Florida. Florida PRIME meets all the
necessary criteria to report their investments at amortized cost in accordance with GASB Cod. Sec. In5. As of
September 30, 2024, there were no redemption fees, maximum transaction amounts or any other requirements
that service to limit the City’s access to one hundred percent of t heir account value. The fair value of the City’s
position in the pool in the same as the value of the pool shares.
The City’s fixed income investment balances as of September 30, 2024, are comprised of the following items:
Percentage of
Moody's Credit Total Fixed Income
Investment Type Rating Investments
Corporate Bonds Aaa 0.36%
Corporate Bonds Aa2 0.24%
Corporate Bonds Aa3 0.99%
Corporate Bonds A1 5.01%
Corporate Bonds A2 3.40%
Corporate Bonds A3 4.87%
Corporate Bonds Baa1 5.82%
Corporate Bonds Baa2 7.16%
Corporate Bonds Baa3 0.67%
Corporate Bonds Not Rated 6.83%
U.S. Treasury Obligations and Federal Agency Securities Aaa 55.31%
U.S. Treasury Obligations and Federal Agency Securities Not Rated 9.34%
100.00%
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
38
NOTE 2 – CASH AND INVESTMENTS (cont…)
Listed below are the investments, credit ratings and maturities in the City’s pension trust funds on September 30,
2024:
General Employees’ Pension Plan:
Investment Maturities
Fair Less than 1-5 6-10 More than
Investment Type Value 1 Year Years Years 10 Years Total
Money market funds / cash $ 317,578 $ 317,578 $ - $ - $ - $ 317,578
Corporate bonds 3,130,075 - 1,295,129 1,041,598 793,348 3,130,075
U.S. Treasury Obligations and
Federal Agency Securities 3,733,533 109,726 1,650,208 1,022,264 951,335 3,733,533
Total $ 7,181,186 $ 427,304 $ 2,945,337 $ 2,063,862 $ 1,744,683 $ 7,181,186
Police Officers Pension Plan:
Investment Maturities
Fair Less than 1-5 6-10 More than
Investment Type Value 1 Year Years Years 10 Years Total
Money market funds / cash $ 671,010 $ 671,010 $ - $ - $ - $ 671,010
Corporate bonds 1,883,031 - 1,232,144 544,643 106,244 1,883,031
U.S. Treasury Obligations and
Federal Agency Securities 2,334,832 49,933 1,065,483 607,713 611,703 2,334,832
Total $ 4,888,873 $ 720,943 $ 2,297,627 $ 1,152,356 $ 717,947 $ 4,888,873
The City’s pension trust fund fixed income investment balances as of September 30, 2024, are comprised of the
following items:
General Employees’ Pension Plan:
Percentage of
Moody's Credit Total Fixed Income
Investment Type Rating Investments
Corporate Bonds Aaa 0.29%
Corporate Bonds Aa2 1.54%
Corporate Bonds Aa3 0.92%
Corporate Bonds A1 10.74%
Corporate Bonds A2 5.11%
Corporate Bonds A3 6.64%
Corporate Bonds Baa1 5.83%
Corporate Bonds Baa2 8.75%
Corporate Bonds Baa3 2.75%
Corporate Bonds Not Rated 3.02%
U.S. Treasury Obligations and Federal Agency Securities AAA 42.62%
U.S. Treasury Obligations and Federal Agency Securities Not Rated 11.79%
100.00%
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
39
NOTE 2 – CASH AND INVESTMENTS (cont…)
Police Officers Pension Plan:
Percentage of
Moody's Credit Total Fixed Income
Investment Type Rating Investments
Corporate Bonds Aaa 0.25%
Corporate Bonds Aa2 1.30%
Corporate Bonds Aa3 0.76%
Corporate Bonds A1 10.45%
Corporate Bonds A2 4.96%
Corporate Bonds A3 7.87%
Corporate Bonds Baa1 7.99%
Corporate Bonds Baa2 7.96%
Corporate Bonds Baa3 1.53%
Corporate Bonds Not Rated 1.58%
U.S. Treasury Obligations and Federal Agency Securities Aaa 9.19%
U.S. Treasury Obligations and Federal Agency Securities Not Rated 46.16%
100.00%
Credit Risk—It is the City’s Police Officers’ Retirement System Trust Fund’s and the City’s General Employees’
Retirement System Trust Fund’s investment policies to, at a minimum, limit 80% of the total fixed income portfolio
to those that are rated investment grade of higher. The Police Officers’ Retirement System Trust Fund’s investment
policy defines investment grade as “BBB”, Baa”, or their equivalent.
Also, no more than 10% (at cost) of the fixed income portfolio total value can be invested in the securities of any
single corporate issuer. The maximum allocation to International Equities is 25%.
Custodial Credit Risk—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.
The City’s investment policy does not contain legal or policy requirements that would limit the exposure to custodial
credit risk for deposits or investments, other than the following provision for deposits: The Finance Director may
execute a third-party Custodial Safekeeping Agreement with a commercial bank having trust powers or a trust
company which is chartered by the United States government or the State of Florida. All securities purchased and/or
collateral obtained by the City shall be properly designated as an asset of the City and held in safekeeping by the
trust department or trust company, and no withdrawal of such securities, in whole or in part, shall be made from
safekeeping, except by an authorized City staff member. The third-party Custodial Safekeeping Agreement shall
include letters of authority from the City with details as to responsibilities of parties, notification of security
purchases, sales, deliver, repurchase agreements, wire transfers, safekeeping and transaction costs, procedur es in
case of wire failure or other unforeseen mishaps, including liability of each party.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
40
NOTE 2 – CASH AND INVESTMENTS (concluded)
Fair Value Measurements
The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair value into three levels:
• Level 1 Inputs―are quoted prices (unadjusted) for identical assets or liabilities in active markets that a
government can access at the measurement date.
• Level 2 Inputs―are inputs other than quoted prices included within Level 1 that are observable for an asset
or liability, either directly or indirectly.
• Level 3 Inputs―are unobservable inputs for an asset or liability.
The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. If a price
for an identical asset or liability is not observable, a government should measure fair value using another valuation
technique that maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs.
The City’s investments are measured at fair value on a recurring basis. Fair value measurements are categorized
based on the valuation inputs used to measure an asset’s fair value in the hierarchy described above.
The fair value measurements for the City’s investments are as follows on September 30, 202 4:
Fair Value Measurements Using
Quoted Prices in Significant Other Significant
Active Markets for Observable Unobservable
Identical Assets Inputs Inputs
Investments by Fair Value Level Amount (Level 1) (Level 2) (Level 3)
City Investments:
Accrued interest $ 230,124 $ 230,124 $ - $ -
Money Markets 121,012 121,012 - -
Corporate Bonds 9,403,545 - 9,403,545 -
U.S. Treasury Obligations and
Federal Agency Securities 17,183,500 - 17,183,500 -
Subtotal - City Investments 26,938,181 351,136 26,587,045 -
General Employees' Pension Plan:
Money Markets 317,578 317,578 - -
Corporate Bonds 3,130,075 - 3,130,075 -
U.S. Treasury Obligations and
Federal Agency Securities 3,733,533 - 3,733,533 -
Mutual Funds - Equities 4,593,026 4,593,026 - -
ETFs 5,520,030 5,520,030 - -
Equities 11,560,098 11,560,098 - -
Subtotal - General Employees' Pension Plan 28,854,340 21,990,732 6,863,608 -
Police Officers' Pension Plan:
Money Markets 671,010 671,010 - -
Corporate Bonds 1,883,031 - 1,883,031 -
U.S. Treasury Obligations and
Federal Agency Securities 2,334,832 - 2,334,832 -
Mutual Funds - Equities 2,780,839 2,780,839 - -
ETFs 3,599,743 3,599,743 - -
Equities 7,517,204 7,517,204 - -
ICMA Self Directed 51,751 51,751 - -
Subtotal - Police Officers' Pension Plan 18,838,410 14,620,547 4,217,863 -
Total Investments Measured at Fair Value $ 74,630,931 $ 36,962,415 $ 37,668,516 $ -
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
41
NOTE 3 – RECEIVABLES
Receivables, net of the allowance for doubtful accounts on September 30, 202 4, consist of the following:
Total Allowance Accounts
Accounts for Doubtful Receivable
Fund Receivable Accounts Net
General Fund $ 1,264 $ - $ 1,264
Utility Fund 888,929 (248,831) 640,098
Stormwater Fund 80,619 (28,635) 51,984
Sanitation Fund 131,599 (23,909) 107,690
Total $ 1,102,411 $ (301,375) $ 801,036
Included in accounts receivable are $281,386 of water and sewer revenues earned but not billed as of September
30, 2024.
NOTE 4 – LEASES
Lease Receivable – The City has one reportable lease receivable related to antenna lease agreements originally
executed in 2005. The lease term includes an initial 5-year period with the option of 5 separate 5-year renewal
periods thereafter. The lease term ends in 2035 and the lease payments are increased by 3.3% each year.
The City also entered into a new antenna placement lease during 2022 whose lease term includes an initial term of
5 years with the option of 4 5-year renewal periods thereafter ending in 2046. The lease payments are increased by
2% each year.
The City recognized $39,817 in lease revenue and $22,392 of interest revenue during the fiscal year related to these
two leases. On September 30, 2024, the City’s receivable for lease payments was $877,138 and reported in the City’s
utility enterprise fund. Also, the City has a deferred inflow of resources associated with this lease that will be
recognized as revenue over the lease term. On September 30, 2024, the balance of the deferred inflow of resources
was $821,233.
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CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
42
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the fiscal year ended September 30, 2024, is as follows:
Balance Balance
October 1, September 30,
2023 Transfers Increases Decreases 2024
Governmental Activities:
Capital assets, not being depreciated:
Land $ 12,090,795 $ - $ 1,080,243 $ - $ 13,171,038
Construction in process 4,317,107 (2,444,564) 2,450,884 - 4,323,427
Total capital assets, not being depreciated 16,407,902 (2,444,564) 3,531,127 - 17,494,465
Capital assets, being depreciated:
Buildings 9,810,880 - 708,723 - 10,519,603
Intangible assets 525,445 - 49,461 - 574,906
Improvements other than buildings 44,764,893 2,444,564 1,555,587 (7,149) 48,757,895
Machinery and equipment 7,668,424 - 366,555 (83,384) 7,951,595
Total capital assets, being depreciated 62,769,642 2,444,564 2,680,326 (90,533) 67,803,999
Less accumulated depreciation for:
Buildings (3,280,045) - (189,698) - (3,469,743)
Intangible assets (468,509) - (18,893) - (487,402)
Improvements other than buildings (20,567,696) - (723,564) - (21,291,260)
Machinery and equipment (6,659,612) - (516,118) 83,384 (7,092,346)
Total accumulated depreciation (30,975,862) - (1,448,273) 83,384 (32,340,751)
Total capital assets being depreciated, net 31,793,780 2,444,564 1,232,053 (7,149) 35,463,248
Governmental activities capital assets, net $ 48,201,682 $ - $ 4,763,180 $ (7,149) $ 52,957,713
Business-type activities:
Capital assets, not being depreciated:
Land $ 1,656,018 $ - $ - $ - $ 1,656,018
Construction-in-progress 3,512,759 (1,221,220) 2,112,717 - 4,404,256
Total capital assets, not being depreciated 5,168,777 (1,221,220) 2,112,717 - 6,060,274
Capital assets, being depreciated:
Buildings 4,354,563 - - - 4,354,563
Intangible assets 244,709 - - - 244,709
Improvements other than buildings 88,913,308 1,221,220 433,235 - 90,567,763
Machinery and equipment 4,287,993 - 74,979 (96,740) 4,266,232
Total capital assets, being depreciated 97,800,573 1,221,220 508,214 (96,740) 99,433,267
Less accumulated depreciation for:
Buildings (4,343,838) - (5,611) - (4,349,449)
Intangible assets (31,995) - (189) - (32,184)
Improvements other than buildings (61,015,560) (28,332) (2,164,801) - (63,208,693)
Machinery and equipment (3,592,933) - (187,646) 96,740 (3,683,839)
Total accumulated depreciation (68,984,326) (28,332) (2,358,247) 96,740 (71,274,165)
Total capital assets being depreciated, net 28,816,247 1,192,888 (1,850,033) - 28,159,102
Business-type activities capital assets, net $ 33,985,024 $ (28,332) $ 262,684 $ - $ 34,219,376
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
43
NOTE 5 – CAPITAL ASSETS (concluded)
Depreciation expense was charged to functions/programs as follows:
Governmental Activities:
General government $ 190,060
Public safety 354,638
Transportation 574,311
Parks and recreation 329,264
Total depreciation expense - governmental activities $ 1,448,273
Business-type Activities:
Utility $ 1,797,339
Stormwater 522,707
Sanitation 23,836
Building Code Enforcement 14,365
Total depreciation expense - business-type activities $ 2,358,247
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CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
44
NOTE 6 – LONG-TERM OBLIGATIONS
The following is a summary of the changes in long-term obligations of the City for the year ended September 30, 2024:
Balance Balance Amounts
October 1, September 30, Due within
2023 Increases Decreases 2024 One Year
Governmental Activities:
Long-term debt:
Capital Improvement Revenue Bond, Series 2018 $ 1,095,000 $ - $ (85,000) $ 1,010,000 $ 85,000
Total long-term debt 1,095,000 - (85,000) 1,010,000 85,000
Other liabilities:
OPEB obligation 262,072 - (27,505) 234,567 -
Net pension liability 4,986,980 - (2,468,281) 2,518,699 -
Compensated absences 1,034,591 - (65,938) 968,653 194,526
Total other liabilities 6,283,643 - (2,561,724) 3,721,919 194,526
Total long-term obligations $ 7,378,643 $ - $ (2,646,724) 4,731,919 $ 279,526
Less amounts due in one year (279,526)
Total noncurrent obligations due in more than one year $ 4,452,393
Business-type Activities:
Long-term debt:
Utility System Revenue Refunding Bond, Series 2014 $ 4,175,000 $ - $ (1,360,000) $ 2,815,000 $ 1,390,000
Refunding Bank Loan Series 2021 4,309,000 - (455,000) 3,854,000 461,000
Total bonds and notes payable 8,484,000 - (1,815,000) 6,669,000 1,851,000
Other liabilities:
OPEB obligation 97,683 - (12,700) 84,983 -
Net pension liability 1,341,113 - (500,240) 840,873 -
Compensated absences 331,480 - (24,929) 306,551 65,422
Total other liabilities 1,770,276 - (537,869) 1,232,407 65,422
Total long-term liabilities $ 10,254,276 $ - $ (2,352,869) 7,901,407 $ 1,916,422
Less amounts due in one year (1,916,422)
Net long-term liabilities in excess of one year $ 5,984,985
Notes to the Long-Term Obligations Table:
Long term liabilities, including accumulated compensated absences, OPEB liability and the City’s net pension
liabilities, are typically liquidated by the individual fund to which the liability is directly associated.
All of the City’s long-term debt arose through direct borrowings or direct placements.
Governmental Activities:
• Capital Improvement Revenue Bond, Series 2019 – Payable in annual installment of principal and
semiannual installments of interest through October 1, 2033, bearing coupon rates of 3.550%, secured
solely by a pledge of non-advalorem revenues.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
45
NOTE 6 – LONG-TERM OBLIGATIONS (cont…)
Notes to the Long-Term Obligations Table:
Business-type Activities
• Utilities System Revenue Refunding Bond, Series 2014, Payable in Annual Installments of Principal and
Semiannual Installments of Interest Through October 1, 2025, Bearing Coupon Rates of 2.330%, Secured
Solely by a Pledge of and Lien on Net Water and Sewer System Revenues and Certain Other Revenues as
Defined in the Bond Ordinance.
• Refunding Bank Loan Series 2021 was issued on May 17, 2021 in the amount of $5,193,000 to refund the
FDEP loans #DW160710 and #WW160700. The FDEP loans were originally used for water and wastewater
system improvements. The Refunding Bank Loan Series 2021 is payable in semiannual installments of
principal and interest through May 15, 2032 with an effective interest rate of 1.69% and is secured solely
by a pledge of net water and sewer system revenues, after payment of all yearly payment obligations on
account of the senior revenue obligations, as defined in the loan agreement.
Notes to the Long-Term Obligations Table:
The annual requirements to amortize all revenue bonds and loans payable outstanding on September 30, 202 4, are
as follows:
Governmental Activities Business-type Activities
Fiscal Year Ending Principal Interest Principal Interest
2025 $ 85,000 $ 34,346 $ 1,851,000 $ 112,696
2026 90,000 31,240 1,895,000 72,056
2027 90,000 28,045 478,000 47,463
2028 95,000 24,761 487,000 39,329
2029 100,000 21,300 496,000 31,050
2030-2034 550,000 50,588 1,462,000 42,706
Total $ 1,010,000 $ 190,280 $ 6,669,000 $ 345,300
Interest and amortization expenses incurred during the year ended September 30, 2024, amounted to $317,185.
The City is also required to maintain certain debt service coverage ratios in accordance with bond resolutions. As of
September 30, 2024, and during the year then ended, the City was in compliance with those ratios.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
46
NOTE 6 – LONG-TERM OBLIGATIONS (concluded)
Pledged Revenue
The City has pledged certain revenues to repay certain bonds and notes outstanding as of September 30, 202 4. The
following table reports the revenues, sometimes net of related operating expenses, pledged for each debt issue, the
amounts of such revenues received in the current year, the current year principal and interest paid on the debt, the
approximate percentage of each revenue which is pledged to meet the debt obligation, and the date through which
the revenue is pledged under the debt agreement, and the total pledged future revenues for each debt, which is the
amount of the remaining principal and interest on the bonds and notes at September 30, 202 4:
Percentage
of Net
Revenue Total Principal Current Year Revenues to
Pledged and Interest Principal and Current Year Principal and
Description Pledged Revenue Through Outstanding Interest Paid Net Revenue Interest Paid
2014 - Utility System
Refunding Bonds Utility Net Revenues 2026 $ 2,880,997 $ 1,441,434 $ 5,259,584
Refunding Bank Loan,
Series 2021 Utility Net Revenues 2032 4,133,303 526,030 5,259,584
Total $ 7,014,300 $ 1,967,464 $ 5,259,584 267.33%
Remedies in the Event of Default
The City’s debt obligations all allow for the obligors to take whatever legal actions necessary to collect the amounts
due in the event of default.
Conduit Debt
The City has issued Health Facility Revenue and Refunding Bonds to provide financial assistance to private sector
entities for the acquisition and construction of health care facilities deemed to be in the public interest. These bonds
are secured by the financed property and are payable solely from the payments received on the underlying mortgage
loans.
There is no obligation on the part of the City or any political subdivision for repayment of the bonds. Accordingly,
the bonds are not reported as liabilities in the accompanying financial statements. As of September 30, 2024, there
are two series of Health Facility Revenue and Refunding Bonds outstanding, with an aggregate principal amount
payable of $118,380,000
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
47
NOTE 7 – DEFINED BENEFIT PENSION PLANS
Plan Descriptions
The City maintains two separate single employer defined benefit pension plans, one for police officers and one for
general employees, which cover substantially all full-time City employees hired before September 1, 2008. The
general employees’ defined benefit plan is closed to new entrants. Full-time general employees hired on or after
September 1, 2008, are covered by the defined contribution plan disclosed in Note 8. The pension plans do not issue
separate stand-alone financial statements. Combining statements are included below in NOTE 7 of the notes to
financials statements. As of, and for the year ended September 30, 2024, the two plans have the following balances
reported in the government-wide financials statements:
Net
Total pension Deferred Deferred Pension
Pension liability outflows inflows expense
Retirement Plan Liability (asset) of resources of resources (benefit)
General Employees' $ 25,579,142 $ 1,707,217 $ 1,703,816 $ - $ 993,791
Police Officers' 17,916,032 1,652,354 1,443,422 181,876 548,009
$ 43,495,174 $ 3,359,571 $ 3,147,238 $ 181,876 $ 1,541,800
Detailed disclosures for each plan follow.
General Employees’ Retirement Plan
Plan Description
The General Employees’ Retirement Plan (the Plan) provides retirement, disability, and death benefits to Plan
members and their beneficiaries. The City Commission has the authority to establish and amend the benefit
provisions of the Plan. The Plan is governed by a Retirement Plan Board appointed by the City Commission and
comprised of five members, two of which will be eligible legal residents of the City, two of which will be general
employees elected by the majority of general employees who are members of the Plan, and one of which will be
elected by the other four members. Plan membership in the General Employees’ Retirement Plan on September 30,
2023 and 2022 (latest actuarial data available), were as follows:
September 30 September 30
2023 2022
Inactive plan members or beneficiaries
currently receiving benefits 84 84
Inactive plan members entitled to but
not yet receiving benefits 6 6
Active plan members 15 18
Total 105 108
Plan Benefits
Normal retirement is available upon the attainment of age sixty and the completion of five years of credited service.
Early retirement is available with a reduced benefit upon the attainment of age fifty -five and the completion of five
years of credited service. For members hired before April 24, 2005, the normal retirement benefit shall equal 2.85%
of average final compensation for each year of credited service. For members hired on or after April 24, 2005, the
normal retirement benefit shall equal 2.50% of average final compensation for each year of credited service. The
Plan includes a deferred retirement option program (DROP) under which members eligible for normal retirement
may have their monthly pension benefit credited to an account while continu ing to be actively employed for up to
five years. As of September 30, 2024, Plan net position included $259,759 of DROP account balances.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
48
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Contributions
The City is required to contribute an actuarially determined amount of $352,301 (29% of covered payroll) for the
year ended September 30, 2024. City contributions to the Plan were $689,268 for the year ended September 30,
2024. Plan members are required to contribute 6.0% of their annual covered salary. Contribution requirements are
established by City code, which may be amended by the City Commission.
Measurement Date
The City elected to use a measurement date to value the net pension liability and related deferred inflows and
outflows as of September 30, 2023, one year prior to the reporting date. The City’s Pension Plans do not issue
separate financial statements. Therefore, the disclosures required for the Plan as of September 30, 202 4, are also
included below.
Net Pension Liability
The components of the changes in the net pension liability for the Plan for the year ended September 30, 2024
(September 30, 2023 measurement date) is shown below:
Increase (Decrease)
Total Pension Plan Fiduciary Net Pension
Liability Net Position (Asset) Liability
(a) (b) (a)-(b)
Reporting period ending 9/30/2023 $ 25,540,642 $ 22,047,291 $ 3,493,351
Changes for the year:
Service cost 214,537 - 214,537
Interest 1,670,865 - 1,670,865
Difference between actual and
expected experience 156,347 - 156,347
Contributions - City - 850,266 (850,266)
Contributions - employee - 75,784 (75,784)
Net investment income - 2,937,968 (2,937,968)
Benefit payments, including refunds
of employee contributions (2,003,249) (2,003,249) -
Administrative expense - (36,135) 36,135
Net changes 38,500 1,824,634 (1,786,134)
Reporting period ending 9/30/2024 $ 25,579,142 $ 23,871,925 $ 1,707,217
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
49
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
The components of the net pension liability (asset) for the Plan as of the September 30, 202 4 measurement date
were as follows:
Total pension liability $ 27,234,843
Plan fiduciary net position (27,839,791)
Net pension liability (asset) $ (604,948)
Plan fiduciary net position as a
percentage of the total pension liability 102%
For the year ended September 30, 2024, the City recognized a total pension expense of $993,791. The City reported
deferred outflows of resources and deferred inflows of resources related to the General Employees’ Pension Plan
from the following sources:
Deferred Deferred
Outflows of Inflows of
Description Resources Resources
Differences between expected and
actual experience $ 14,213 $ -
Change in assumptions - -
Difference between projected and
actual earnings on Plan investments 1,000,335 -
City contributions subsequent to the
measurement date 689,268 -
Total $ 1,703,816 $ -
Contributions made after the measurement date (shown above) will be recognized as a reduction of net pension
liability (or increase in the net pension asset) in the fiscal year ended September 30, 2025. Other amounts reported
as deferred outflows of resources related to pensions will be recognized in pension expense as follows:
Year ending
September 30, Amount
2025 $ 251,373
2026 187,715
2027 873,490
2028 (298,030)
$ 1,014,548
Plan Investments
The Retirement Plan Board is responsible for establishing and amending the Plan’s investment policies. The Plan’s
current investment policy gives the Board discretion to allocate assets with assistance of the Plan’s investment
consultant. No formal targets are stated in the investment policy although the maximum allocation to international
equities is 25%. The money-weighted rate of return on Plan investments, net of investment related expenses, was
22.38% and 14.05% for the years ended September 30, 2024 and 2023, respectively.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
50
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Actuarial Assumptions
The total pension liability was determined by actuarial valuations for the Plan as of October 1, 20 22, rolled forward
to the measurement date of September 30, 202 3, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation: 2.50%
Salary Increases: Age based ranging from 4.80% to 9.50% (including 2.50% price inflation).
Investment Rate of Return: 6.75% per year compounded annually, net of investment expenses.
Mortality: Pub-2010 Headcount-Weighted Mortality Tables are used with mortality
improvements projected for nondisabled lives to all future years using Scale
MP-2018.
Date of Experience Study: Dated August 9, 2017 for the period October 1, 2009 to September 30, 2016
Long Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building -block method
in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan
investment expense of 0.50% and inflation of 2.50%) are developed for each major asset class. These ranges are
combined to produce the long-term expected rate of return by weighting the expected future real rates of return by
the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of
return for each major asset class included in the pension plan's target asset allocation (see the discussion of the
pension plans’ investment policy) are summarized in the following table:
Target Long-Term Expected
Asset Class Allocation Real Net Rate of Return
Large Cap Equity 33% 6.69%
Small/Mid Cap Equity 10% 7.00%
International Equities 15% 5.56%
Fixed Income (70% core/30% Short-term) 30% 1.29%
Alternatives (50% REITS/50% MLPS) 6% 5.06%
Cash and Equivalents 6% 0.70%
Discount Rate
A single discount rate was used to measure the total pension liability. The single discount rate was based on the
expected rate of return on Plan investments of 6.75%. The projection of cash flows used to determine the single
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 Plan’s fiduciary net position was projected to be available to
make all projected future benefit payments of current plan members. Therefore, the long -term expected rate of
return on Plan investments (6.75%) was applied to all periods of projected benefit paymen ts to determine the total
pension liability.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
51
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability
(asset) of the City, calculated using the discount rate noted below, as well as what the City's net pension liability
(asset) would be if it were calculated using a discount rate that is 1 -percentage-point lower or 1-percentage-point
higher than the current rate for both the measurement date of September 30, 2023 and the financial reporting date
of September 30, 2024.
Current
As of Discount
September, Rate 1% Decrease Current Rate 1% Increase
9/30/2023 6.75% $ 4,225,050 $ 1,707,217 $ (476,902)
9/30/2024 6.25% $ 2,099,666 $ (604,948) $ (2,954,441)
Police Officers’ Retirement Plan
Plan Description
The Police Officers’ Retirement Plan (the Police Plan) provides retirement, disability, and death benefits to Police
Plan members and their beneficiaries. The Police Plan is governed by the Policemen’s Pension Board of Trustees,
although the City Commission retains the authority to establish and amend the benefit provisions of the Police Plan.
The Policemen’s Pension Board of Trustees is appointed by the City Commission and comprised of five members,
two of which will be eligible legal residents of the City, two of which will be police officers elected by the majority of
police officers who are members of the Police Plan, and one of which will be elected by the other four trustees.
Membership in the Police Officers’ Retirement Plan as of the September 30, 2023 and 2022 measurement dates
(latest actuarial data available), were as follows:
September 30 September 30
2023 2022
Inactive plan members or beneficiaries
currently receiving benefits 21 21
Inactive plan members entitled to but
not yet receiving benefits 5 4
Active plan members 25 26
Total 51 51
Plan Benefits
For members hired before January 1, 2013, normal retirement is available upon the attainment of age fifty and the
completion of twenty years of credited service, the attainment of age fifty -five and the completion of ten years of
credited service, the completion of twenty-five years of credited service regardless of age, or the attainment of age
sixty and the completion of five years of credited service. For members hired on or after January 1, 2013, normal
retirement is available upon the attainment of age fifty-five and the completion of ten years of credited service or
the attainment of age fifty-two and the completion of twenty-five years of credited service. Early retirement is
available with a reduced benefit upon the attainment of age fifty and the completion of ten years of credited service.
For members hired before January 1, 2013, the normal retirement benefit shall equal 3.00% of average final
compensation for each year of credited service. For members hired on or after January 1, 2013, the normal
retirement benefit shall equal 2.00% of average final compensation for each year of credited service. The Police Plan
includes a DROP under which members eligible for normal retirement may have their monthly pension benefit
credited to an account while continuing to be actively employed for up to five years. As of September 30, 2024,
Police Plan net position included $52,667 of DROP account balances.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
52
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Contributions
The City is required to contribute an actuarially determined amount of $449,957 (17% of covered payroll) for the
year ended September 30, 2024. The City may use State contributions to offset this required contribution. City and
State contributions to the Police Plan were $451,228 for the year ended September 30, 2024. Police Plan members
are required to contribute 8.0% of their annual covered salary. Per City Code, the City Commission may amend
established contribution requirements.
Measurement Date
The City elected to use a measurement date to value the net pension liability and related deferred inflows and
outflows as of September 30, 2023, one year prior to the reporting date. The City’s Pension Plans do not issue
separate financial statements. Therefore, the disclosures required for the Plan as of September 30, 202 4, are also
included below.
Net Pension Liability
The components of the changes in the net pension liability for the Police Plan for the year ended September 30,
2024 (September 30, 2023 measurement date) is shown below:
Increase (Decrease)
Total Pension Plan Fiduciary Net Pension
Liability Net Position (Asset) Liability
(a) (b) (a)-(b)
Reporting period ending 9/30/2023 $ 17,179,024 $ 14,344,282 $ 2,834,742
Changes for the year:
Service cost 426,687 - 426,687
Interest 1,164,223 - 1,164,223
Difference between actual and
expected experience (137,974) - (137,974)
Other 19,500 - 19,500
Contributions - City - 558,351 (558,351)
Contributions - State - 165,133 (165,133)
Contributions - employee - 215,375 (215,375)
Net investment income - 1,742,688 (1,742,688)
Benefit payments, including refunds
of employee contributions (735,428) (735,428) -
Administrative expense - (26,723) 26,723
Net changes 737,008 1,919,396 (1,182,388)
Reporting period ending 9/30/2024 $ 17,916,032 $ 16,263,678 $ 1,652,354
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
53
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
The components of the net pension liability (asset) for the Police Plan as of the September 30, 202 4 measurement
date were as follows:
Total pension liability $ 20,610,200
Plan fiduciary net position (19,511,033)
Net pension liability (asset) $ 1,099,167
Plan fiduciary net position as a
percentage of the total pension liability 95%
For the year ended September 30, 2024, the City recognized total pension expense of $548,009. The City reported
deferred outflows of resources and deferred inflows of resources related to the Police Plan from the following
sources:
Deferred Deferred
Outflows of Inflows of
Description Resources Resources
Differences between expected and
actual experience $ 87,097 $ 113,543
Change in assumptions - 68,333
Net difference between projected and
actual earnings on Plan investments 905,097 -
City contributions subsequent to the
measurement date 451,228 -
Total $ 1,443,422 $ 181,876
Contributions made after the measurement date (shown above) will be recognized as a reduction of net pension
liability (or increase in the net pension asset) in the fiscal year ending September 30, 202 5. Other amounts reported
as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows:
Year ending
September 30, Amount
2025 $ 169,488
2026 188,787
2027 588,380
2028 (136,337)
$ 810,318
Plan Investments
The Policemen’s Pension Board of Trustees is responsible for establishing and amending the Police Plan’s investment
policies. The Police Plan’s current investment policy gives the Board discretion to allocate assets with assistance of
the Police Plan’s investment consultant. No formal targets are stated in the investment policy although the
maximum allocation to international equities is 25%. The money -weighted rate of return on Plan investments, net
of investment related expenses, was 22.47% and 6.13% for the years ended September 30, 2024 and 2023,
respectively.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
54
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Actuarial Assumptions
The total pension liability was determined by actuarial valuations for the Plan as of October 1, 2022, rolled forward
to September 30, 2023, using the following actuarial assumptions, applied to all periods included in the
measurement:
Inflation: 2.50%
Salary Increases: Age based ranging from 4.80% to 18.50% (including 2.50% price inflation.
Investment Rate of Return: 6.75% per year compounded annually, net of investment expenses.
Mortality: Pub-2010 Headcount-Weighted Mortality Tables are used with mortality
improvements projected for nondisabled lives to all future years using Scale
MP-2018.
Date of Experience Study: Dated August 9, 2017 for the period October 1, 2009 to September 30, 2016
Long Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building -block method
in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan
investment expense of 0.50% and inflation of 2.50%) are developed for each major asset class. These ranges are
combined to produce the long-term expected rate of return by weighing the expected future real rates of return by
the target asset allocation percentage and by adding expected infl ation. Best estimates of arithmetic real rates of
return for each major asset class included in the pension plan's target asset allocation (see the discussion of the
pension plans’ investment policy) are summarized in the following table:
Target Long-Term Expected
Asset Class Allocation Real Net Rate of Return
Large Cap Equity 33% 6.69%
Small/Mid Cap Equity 10% 7.00%
International Equities 15% 5.56%
Fixed Income (70% core/30% Short-term) 30% 1.29%
Alternatives (50% REITS/50% MLPS) 6% 5.06%
Cash and Equivalents 6% 0.70%
Discount Rate
A single discount rate was used to measure the total pension liability. The single discount rate was based on the
expected rate of return on Plan investments of 6.75%. The projection of cash flows used to determine the single
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 Plan’s fiduciary net position was projected to be available to
make all projected future benefit payments of current plan members. Therefore, the long -term expected rate of
return on Plan investments (6.75%) was applied to all periods of projected benefit paymen ts to determine the total
pension liability.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
55
NOTE 7 – DEFINED BENEFIT PENSION PLANS (cont…)
Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability
(asset) of the City, calculated using the discount rate noted below, as well as what the City's net pension liability
(asset) would be if it were calculated using a discount rate that is 1 -percentage-point lower or 1-percentage-point
higher than the current rate for both the measurement date of September 30, 2023 and the financial reporting date
of September 30, 2024.
Current
As of Discount
September, Rate 1% Decrease Current Rate 1% Increase
9/30/2023 6.75% $ 3,564,072 $ 1,652,354 $ 43,465
9/30/2024 6.25% $ 3,149,910 $ 1,099,167 $ (619,308)
The Statements of Fiduciary Net Position for the City’s pension trust funds for the year ended September 30, 202 4
were as follows:
Pension Trust Funds
General Police
Employees' Officers'
Retirement Retirement 2024 2023
Plan Plan Totals Totals
ASSETS
Cash and cash equivalents $ - $ 648,347 $ 648,347 $ 828,906
Accrued income 61,127 37,230 98,357 89,333
Investments at fair value 28,854,340 18,838,410 47,692,750 39,220,515
Total assets 28,915,467 19,523,987 48,439,454 40,138,754
LIABILITIES
Accounts payable and accrued liabilities 19,390 12,954 32,344 3,151
Due to City 1,056,286 - 1,056,286 -
Total Liabilities 1,075,676 12,954 1,088,630 3,151
NET POSITION
Restricted for pension benefits $ 27,839,791 $ 19,511,033 $ 47,350,824 $ 40,135,603
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CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
56
NOTE 7 – DEFINED BENEFIT PENSION PLANS (concluded)
The Statements of Changes in Fiduciary Net Position for the City’s pension trust funds for the year ended September
30, 2024 were as follows:
Pension Trust Funds
General Police
Employees' Officers'
Retirement Retirement 2024 2023
Plan Plan Totals Totals
ADDITIONS
Contributions:
City $ 689,268 $ 451,228 $ 1,140,496 $ 1,408,617
Plan members 72,724 215,508 288,232 291,159
State of Florida - - - 165,133
Total contributions 761,992 666,736 1,428,728 1,864,909
Investment income 5,263,786 3,445,925 8,709,711 4,823,653
Less investment expenses: (94,035) (61,158) (155,193) (142,997)
Net investment income 5,169,751 3,384,767 8,554,518 4,680,656
Total additions 5,931,743 4,051,503 9,983,246 6,545,565
DEDUCTIONS
Administrative expenses 71,861 61,096 132,957 62,858
Payments to retirees and participants 1,892,016 743,052 2,635,068 2,738,677
Total deductions 1,963,877 804,148 2,768,025 2,801,535
CHANGE IN NET POSITION 3,967,866 3,247,355 7,215,221 3,744,030
NET POSITION, beginning of year 23,871,925 16,263,678 40,135,603 36,391,573
NET POSITION, end of year $ 27,839,791 $ 19,511,033 $ 47,350,824 $ 40,135,603
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
57
NOTE 8 – DEFINED CONTRIBUTION PLAN
The City passed an ordinance in 2013 closing the General Employees’ defined benefit plan to new entrants and
creating the City of Atlantic Beach Defined Contribution Plan. The City’s 457 defined contribution plan is
administered through ICMA, which covers all eligible employees employed with the City on or after September 1,
2008, who are not covered by the City’s Police Officers’ defined benefit plan. Under the 457 Plan, the City
contributes an employer matching contribution of up to 6% of earnings during the fi rst ten years of service.
Following ten years of service, the City contributes an additional fixed contribution of 4% of earnings for a total of
10%. Employees have the option to voluntarily contribute to the 457 Plan. Employer matching contributions fr om
the City were $229,070 and $182,498 for the years ended September 30, 202 4 and 2023, respectively. Under the
457 Plan, an employee is considered fully vested after 5 years of completed service.
NOTE 9 – POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
Plan Description
The City of Atlantic Beach administers a single employer defined benefit health care plan (the Plan) that provides
medical insurance benefits to its employees and their eligible dependents. In accordance with Section 112.0801 of
the Florida Statutes, because the City provides a medical plan to active employees of the City and their eligible
dependents, the City is also required to provide retirees with the opportunity to participate in this Plan. Benefit
provisions for the Plan are established by the City Commission and may be amended by the City Commission. The
City does not issue stand-alone financial statements for the Plan.
Membership in the Plan consisted of the following, as of September 30, 20 23, the valuation date of the latest
actuarial valuation:
September 30,
2023
Inactive plan members or beneficiaries currently receiving benefits 1
Inactive plan members entitled to but not yet receiving benefits -
Active plan members 109
Total 110
Funding Policy
Contribution rates for the Plan are established on an annual basis by the City Commission. Eligible retirees and their
covered dependents receiving benefits contribute 100% of the blended (active and retiree combined) equivalent
premium rates. While the City does not directly contribute towards the costs of retiree premiums via an explicit
subsidy, the ability of retirees to obtain health insurance coverage at a blended, group rate constitutes a significant
economic benefit to retirees, or an “implicit” subsidy. This implicit subsidy is considered to be another
postemployment benefit (OPEB) obligation of the City.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
58
NOTE 9 – POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (cont…)
Actuarial Methods and Assumptions
For the September 30, 2023 actuarial valuation (used for the September 30, 2024 measurement date), the Entry Age
Normal Actuarial Cost Method was used. This method determines a service cost rate as a fixed percentage of
compensation for each active participant. The current years’ service cost is the participant’s compensation
multiplied by the service cost rate. Under this method, service cost for each individual participant, payable from
date of employment to date of retirement, is sufficient to pay for the participant’s benefit at retirement.
Other actuarial assumptions are as follows:
Discount Rate: 4.63%
Investment Rate of Return: 0.0%
Salary Increases: Rates used in the October 1, 2023 actuarial valuation of the City’s pension plans.
Healthcare Cost Trend: Based on Getzen Model, with trend of 8.70% for 2024, 6.00% for 2025 and then
gradually decreasing to an ultimate trend rate of 4.00%.
Mortality: Mortality tables used for Regular and Special Risk Class members in the July 1, 2020 actuarial
valuation of the Florida Retirement System. These rates were taken from the adjusted Pub -2010 mortality
tables published by the Society of Actuaries with gener ational improvements using scale MP-2018. The
adjustments to the reference tables are based on the results of a statewide experience study covering the
period 2013 through 2018.
Discount Rate
The discount rate used to measure the total OPEB liability was 4.63% as of September 30, 2023 (measurement date),
which is equal to the single rate of return developed pursuant to GASB 75. The discount rate used to determine the
liabilities under GASB 75 depends on the City’s funding policy. Since the City does not prefund benefits, the discount
rate required to be used is based on the Fidelity 20-Year Municipal General Obligation AA Index. This index includes
only federally tax-exempt municipal bonds and the yield curves are constructed using option adjusted analytics of a
diverse population of over 10,000 tax exempt securities.
Annual OPEB Cost and Net OPEB Obligation
The City’s total OPEB liability was measured as of September 30, 2023 and was determined by an actuarial valuation
as of September 30, 2022. Changes in the Total OPEB liability were as follows:
Total
OPEB
Liability
Reporting period ending September 30, 2023 $ 359,755
Changes for the year:
Service cost 36,840
Interest 17,072
Differences between expected
and actual experience (73,297)
Changes of assumptions (3,620)
Benefit payments (17,200)
Net changes (40,205)
Reporting period ending September 30, 2024 $ 319,550
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
59
NOTE 9 – POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (cont…)
Sensitivity of the Total OPEB Liability to Changes in the Discount Rate.
The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it
were calculated using a discount rate that is 1-percentage-point lower or 1-percentage-point higher than the current
discount rate:
1% Decrease Rate Assumption 1% Increase
Total OPEB liability $ 350,508 $ 319,550 $ 292,219
Sensitivity of the Total OPEB Liability to Changes in Healthcare Cost Trend Rates.
The following presents the total OPEB liability for the City, as well as what the City’s total OPEB liability would be if
it were calculated using healthcare trend rates that are 1-percentage-point lower or 1-percentage-point higher than
the current healthcare cost trend rates:
Current Healthcare
Cost Trend Rate
1% Decrease Assumption 1% Increase
Total OPEB liability $ 277,515 $ 319,550 $ 371,545
OPEB Expense and Deferred Inflows of Resources Related to OPEB
For the year ended September 30, 2024, the City recognized OPEB expense of $2,700. On September 30, 2024, the
City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following
sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Changes of assumptions or
other inputs $ 30,496 $ 126,956
Differences between expected and
actual experience - 157,555
City contributions subsequent to the
measurement date 11,926 -
Total $ 42,422 $ 284,511
Of the total amount reported as deferred outflows of resources related to OPEB, $11,926 resulting from estimated
benefits paid subsequent to the measurement date and before the end of the fiscal year will be included as a
reduction of the total OPEB liability in the year ended September 30, 202 4. Other amounts reported as deferred
inflows of resources related to OPEB will be recognized in OPEB expense as follows:
Year ended September 30, Amount
2025 $ (51,209)
2026 (48,551)
2027 (46,274)
2028 (34,033)
2029 (29,107)
Thereafter (44,841)
Total $ (254,015)
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
60
NOTE 10 – INTERFUND ACCOUNTS
Individual fund inter-fund receivables and payables on September 30, 2024, consist of the following:
Due Due
from Other to Other
Funds Funds
General Fund $ 2,010,988 $ -
Sanitation Fund - 534,641
Local Option Gas Tax Fund 363,630
Debt Service Fund - 19,848
Court cost training fund - 36,583
General Employees' Retirement Fund - 1,056,286
$ 2,010,988 $ 2,010,988
Inter-fund receivable/payables are due to timing differences or due to deficit positions in the City’s pooled cash and
investments. The receivable/payables are expected to be received/paid within one year.
NOTE 11 – INTERFUND TRANSFERS
Transfers of resources from a fund receiving revenue to the fund through which the resources are to be expended are
recorded as transfers and are reported as other financing sources (uses) in the governmental funds and as transfers in
(out) in the proprietary funds. Following is a summary of inter-fund transfers for the year ended September 30, 2024:
Transfer In:
Community
Development Court Cost
General Capital Projects Debt Service Block Grant Stormwater Training
Fund Fund Fund Fund Fund Fund Total
Transfers Out:
Utility Fund $ 833,916 $ 550,008 $ - $ - $ - $ - $ 1,383,924
General Fund - 185,496 - 52,356 - 21,996 259,848
Parking Fund 110,340 - - - - - 110,340
Local Option Gas Tax Fund 409,596 350,004 - - - - 759,600
Sanitation Fund 359,580 - - - - - 359,580
ARPA Fund - 1,179,538 - - - - 1,179,538
Community Development
Block Grant Fund - 130,704 - - - - 130,704
Convention Development Tax Fund - - 122,364 - - - 122,364
Half-cent Sales Tax Fund 179,004 335,004 - 78,348 250,296 - 842,652
Total $ 1,892,436 $ 2,730,754 $ 122,364 $ 130,704 $ 250,296 $ 21,996 $ 5,148,550
Transfers are used to move revenues from the fund that ordinance or budget requires to collect them to the fund that
ordinance or budget requires to expend them.
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
61
NOTE 12 – COMMITMENTS
On June 2, 1999, the City entered into an agreement with the City of Jacksonville, Florida, whereas the City of
Jacksonville will provide advanced life support and fire services to the residents and businesses located in the City.
The term of the agreement shall be from the effective date and continuing for a period of 25 years unless terminated
earlier by the parties (such parties must provide a one-year notice). For the year ended September 30, 2024, the
City incurred $1,391,615 in services under this agreement. The amount will be adjusted annually by an amount
equal to 103% of the previous year’s amount for all services provided by the City of Jacksonville.
The previous agreement expired during the fiscal year ended September 30, 2024; however, both the City and the
City of Jacksonville continued to honor its terms while negotiating a new agreement. In June 2025, the parties agreed
to reduce the annual fee for fire and rescue services to $750,000, to be paid in quarterly installments beginning June
1, 2025, and ending May 31, 2026. During the term of this interim agreement, the City and the City of Jacksonville
plan to develop a new long-term interlocal agreement, informed by a third-party evaluation of the service
arrangement.
NOTE 13 - CONTINGENCIES
The City is a defendant in several lawsuits which arose in the ordinary course of the City’s business. To the extent
the outcome of such litigation has been determined to result in probable loss to the City, an estimated loss has been
accrued in the accompanying financial statements. The outcome of the remaining claims cannot be determined at
this time.
NOTE 14 – RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and
omissions; and natural disasters for which the City carries commercial insurance. Insurance against losses is provided
through the Public Risk Insurance Agency and LB Bryan and Company for the following types of risk:
• Workers’ Compensation and Employer’s Liability
• Automobile Liability
• Automobile Physical Damage
• Accidental Death and Dismemberment
• General Liability
• Public Officials’ Liability
• Property Coverage
The City’s coverage for workers’ compensation is under a retrospectively rated policy. Premiums are accrued based
on the ultimate cost to-date of the City’s experience for this type of risk.
NOTE 15 – DEFICIT FUND BALANCE
On September 30, 2024 the following nonmajor governmental funds reported deficit fund balance amounts as
follows:
• Local Option Gas Tax Special Revenue Fund – ($240,357)
• Court Cost Training Special Revenue Fund – ($36,488)
• Debt Service Fund – ($19,848)
These deficits were caused by expenditures paid for by the general fund to be reimbursed by these nonmajor
governmental funds as revenue is generated in future years.
Page Intentionally Left Blank
REQUIRED SUPPLEMENTARY INFORMATION
62
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2024
Actual
Amounts Variance with
Budgeted Amounts (Budgetary Final Budget
Basis) see Positive
Original Final Note A (Negative)
REVENUES
Property taxes $ 7,289,893 $ 7,289,893 $ 7,241,664 $ (48,229)
Non-property taxes 1,222,368 1,222,368 1,205,393 (16,975)
Licenses and permits 1,105,655 1,105,655 940,102 (165,553)
Intergovernmental revenue 3,653,294 3,653,294 2,573,445 (1,079,849)
Charges for services 968,617 968,617 999,959 31,342
Fines and forfeitures 111,375 111,375 122,277 10,902
Investment earnings (loss) 200,000 200,000 588,083 388,083
Miscellaneous revenues 19,050 19,050 88,500 69,450
Interfund charges 1,856,156 1,856,156 1,754,865 (101,291)
Total revenues 16,426,408 16,426,408 15,514,288 (912,120)
EXPENDITURES
City Administration:
City Commission 67,972 67,972 61,644 6,328
City Clerk 394,747 395,047 289,140 105,907
City Attorney 196,429 196,429 163,565 32,864
City Manager 642,822 642,602 617,636 24,966
Human resources 282,140 282,140 505,145 (223,005)
Information technology 914,811 960,511 860,934 99,577
Finance 1,373,024 1,377,101 1,313,801 63,300
Total City administration 3,871,945 3,921,802 3,811,865 109,937
Planning and zoning 500,867 811,129 499,507 311,622
General government 1,844,956 1,806,528 1,569,978 236,550
Public safety:
Police 5,811,319 5,854,553 5,557,008 297,545
Animal control 128,443 128,456 119,948 8,508
Fire control 2,423,437 3,080,611 2,048,251 1,032,360
Code enforcement 133,528 139,528 129,053 10,475
Total public safety 8,496,727 9,203,148 7,854,260 1,348,888
Continued…
63
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2024
Actual
Amounts Variance with
Budgeted Amounts (Budgetary Final Budget
Basis) see Positive
Original Final Note A (Negative)
Public works:
Administration and streets 2,074,040 2,094,440 1,649,605 444,835
Fleet maintenance 364,190 402,543 259,127 143,416
Total public works 2,438,230 2,496,983 1,908,732 588,251
Parks and recreation
Recreation and special events 538,387 540,534 428,166 112,368
Parks maintenance 1,491,674 1,512,809 1,308,745 204,064
Total parks and recreation 2,030,061 2,053,343 1,736,911 316,432
Total expenditures 19,182,786 20,292,933 17,381,253 2,911,680
EXCESS (DEFICIENCY) OF REVENUE OVER
(UNDER) EXPENDITURES (2,756,378) (3,866,525) (1,866,965) 1,999,560
OTHER FINANCING SOURCES (USES):
Transfers out (259,850) (259,850) (259,848) 2
Transfers in 1,892,434 1,892,434 1,892,436 (2)
Sale of general capital assets 25,000 25,000 8,632 (16,368)
Total other financing sources (uses) 1,657,584 1,657,584 1,641,220 (16,368)
NET CHANGE IN FUND BALANCE $ (1,098,794) $ (2,208,941) $ (225,745) $ 1,983,196
64
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO THE SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL –
GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2024
Explanation of differences between budgetary inflows and outflows and GAAP revenues and expenditures:
Sources/inflows of resources
Total revenue from the budgetary comparison schedule $ 15,514,288
Differences - budget to GAAP:
For GAAP, General Fund inter-fund charges are reported as a reduction in the
applicable expenditure function rather than revenues. (1,754,865) (*)
Total revenues as reported on the statement of revenues, expenditures
and changes in fund balances (page 16) $ 13,759,423
Uses/outflows of resources
Actual amounts (budgetary basis) "total charges to appropriations" from the
Total expenditures from the budgetary comparison schedule $ 17,381,253
Differences - budget to GAAP:
For GAAP, General Fund inter-fund charges are reported as a reduction in the
applicable expenditure function rather than revenues. (1,754,865) (*)
Total expenditures as reported on the statement of revenues, expenditures
and changes in fund balances (page 16) $ 15,626,388
(*) - Interfund charges by Division
City Manager $ 293,916
Finance 673,188
Public Works Admin 295,080
Fleet and Equipment Maintenance 71,925
Human Resources 69,432
Information Technology 181,524
Facility Maintenance 169,800
$ 1,754,865
Note A - Budgets and Budgetary Accounting
General governmental revenues and expenditures accounted for in budgetary funds are controlled by a budgetary
accounting system in accordance with various legal requirements which govern the City’s operations. Budgets are
monitored at varying levels of classification detail; however, expenditures cannot legally exceed total appropriations
at the individual fund level. Encumbrances are recorded. Unexpended items which are unencumbered at year-end
must be re-appropriated in the subsequent year.
Budgets are adopted for all governmental funds (general, special revenue, and capital projects funds). The City
Manager is authorized to transfer budgeted amounts within departments within any fund; however, any revisions that
increase the total expenditures of any department or fund must be approved by the City Commission. All necessary
supplemental appropriations are adopted by the City Commission and are included in the reported budgetary data.
The budget presented in the accompanying required supplemental information is prepared in conformity with
accounting principles generally accepted in the United States of America.
65
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – BUDGET AND ACTUAL – AMERICAN RESCUE
PLAN ACT SPECIAL REVENUE FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2024
Actual
Amounts Variance with
Budgeted Amounts (Budgetary Final Budget
Basis) see Positive
Original Final Note A (Negative)
REVENUES
Intergovernmental revenue $ - $ 1,449,148 $ 1,179,538 $ (269,610)
Total revenues - 1,449,148 1,179,538 (269,610)
EXPENDITURES
None - - - -
Total expenditures - - - -
EXCESS (DEFICIENCY) OF REVENUE OVER
(UNDER) EXPENDITURES - 1,449,148 1,179,538 (269,610)
OTHER FINANCING SOURCES (USES):
Transfers out (1,449,148) (1,449,148) (1,179,538) 269,610
Total other financing sources (uses) (1,449,148) (1,449,148) (1,179,538) 269,610
NET CHANGE IN FUND BALANCE $ (1,449,148) $ - $ - $ -
66
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS - GENERAL EMPLOYEES’ PENSION PLAN
City reporting period date 9/30/2025 9/30/2024 9/30/2023 9/30/2022 9/30/2021
Measurement date 9/30/2024 9/30/2023 9/30/2022 9/30/2021 9/30/2020
Total pension liability
Service cost $ 202,244 $ 214,537 $ 241,673 $ 244,995 $ 288,450
Interest 1,676,388 1,670,865 1,646,364 1,633,199 1,604,466
Change in assumptions 1,212,294 - - (420,148) -
Difference between expected and actual
experience 456,791 156,347 255,984 207,558 (44,031)
Benefit payments, including refunds of
of employee contributions (1,892,016) (1,967,963) (1,504,566) (1,429,935) (1,329,553)
Employee buy-back - (35,286) - - -
Net change in total pension liability 1,655,701 38,500 639,455 235,669 519,332
Total pension liability, beginning 25,579,142 25,540,642 24,901,187 24,665,518 24,146,186
Total pension liability, ending (a) $ 27,234,843 $ 25,579,142 $ 25,540,642 $ 24,901,187 $ 24,665,518
Plan fiduciary net position
Contributions - City $ 689,268 $ 850,266 $ 1,099,884 $ 1,248,604 $ 1,362,952
Contributions - Employee 72,724 75,784 81,830 87,209 96,921
Net investment income (loss) 5,169,751 2,937,968 (4,081,483) 4,891,453 1,138,973
Benefit payments, including refunds of
employee contributions (1,892,016) (2,003,249) (1,504,566) (1,429,935) (1,329,553)
Administrative expenses (71,861) (36,135) (45,210) (19,631) (48,109)
Net change in plan fiduciary net position 3,967,866 1,824,634 (4,449,545) 4,777,700 1,221,184
Plan fiduciary net position, beginning 23,871,925 22,047,291 26,496,836 21,719,136 20,497,952
Plan fiduciary net position, ending (b) $ 27,839,791 $ 23,871,925 $ 22,047,291 $ 26,496,836 $ 21,719,136
Net pension liability (asset) (a)-(b) $ (604,948) $ 1,707,217 $ 3,493,351 $ (1,595,649) $ 2,946,382
Plan fiduciary net position as a percentage
of total pension liability 102.22% 93.33% 86.32% 106.41% 88.05%
Covered payroll $ 1,212,067 $ 1,263,067 $ 1,363,833 $ 1,453,483 $ 1,615,350
Net pension liability as a percentage of
covered payroll -49.91% 135.16% 256.14% -109.78% 182.40%
Continued…
67
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS - GENERAL EMPLOYEES’ PENSION PLAN
City reporting period date 9/30/2020 9/30/2019 9/30/2018 9/30/2017 9/30/2016
Measurement date 9/30/2019 9/30/2018 9/30/2017 9/30/2016 9/30/2015
Total pension liability
Service cost $ 332,673 $ 345,019 $ 346,460 $ 348,604 $ 402,093
Interest 1,566,226 1,574,193 1,485,239 1,437,296 1,404,316
Change in assumptions - 695,507 559,117 - -
Difference between expected and actual
experience 40,197 (473,189) 291,669 164,601 (162,280)
Benefit payments, including refunds of
of employee contributions (1,327,161) (1,501,456) (1,319,107) (1,207,804) (1,031,191)
Employee buy-back - - - - -
Net change in total pension liability 611,935 640,074 1,363,378 742,697 612,938
Total pension liability, beginning 23,534,251 22,894,177 21,530,799 20,788,102 20,175,164
Total pension liability, ending (a) $ 24,146,186 $ 23,534,251 $ 22,894,177 $ 21,530,799 $ 20,788,102
Plan fiduciary net position
Contributions - City $ 1,424,479 $ 1,332,119 $ 1,175,572 1,112,344 $ 863,613
Contributions - Employee 107,745 117,536 124,024 128,204 136,191
Net investment income (loss) 619,176 1,554,225 1,792,192 1,515,746 162,326
Benefit payments, including refunds Of
employee contributions (1,327,161) (1,501,456) (1,319,107) (1,207,804) (1,031,191)
Administrative expenses (40,584) (31,261) (53,880) (32,495) (41,909)
Net change in plan fiduciary net position 783,655 1,471,163 1,718,801 1,515,995 89,030
Plan fiduciary net position, beginning 19,714,297 18,243,134 16,524,333 15,008,338 14,919,308
Plan fiduciary net position, ending (b) $ 20,497,952 $ 19,714,297 $ 18,243,134 $ 16,524,333 $ 15,008,338
Net pension liability (asset) (a)-(b) $ 3,648,234 $ 3,819,954 $ 4,651,043 $ 5,006,466 $ 5,779,764
Plan fiduciary net position as a percentage
of total pension liability 84.89% 83.77% 79.68% 76.75% 72.20%
Covered payroll $ 1,795,750 $ 1,958,933 $ 2,067,067 $ 2,136,733 $ 2,269,850
Net pension liability as a percentage of
covered payroll 203.16% 195.00% 225.01% 234.30% 254.63%
Change of Assumptions:
For measurement date September 30, 2024:
• The assumed investment return assumption was reduced from 6.75% to 6.25%.
For measurement date September 30, 2021:
• Reflects updated mortality tables to those used by Florida Retirement System (FRS) as mandated by Section 112.63(1)(f),
Florida Statutes.
For measurement date September 30, 2018:
• The assumed investment return assumption was reduced from 7.00% to 6.75%.
• The assumed rates of salary increase, retirement and withdrawal were revised based on a 7 -year experience study
performed for the Plan.
68
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS - POLICE OFFICERS’ PENSION PLAN
City reporting period date 9/30/2025 9/30/2024 9/30/2023 9/30/2022 9/30/2021
Measurement date 9/30/2024 9/30/2023 9/30/2022 9/30/2021 9/30/2020
Total pension liability
Service cost $ 453,970 $ 426,687 $ 414,067 $ 396,817 $ 369,089
Interest 1,215,576 1,164,223 1,099,655 1,090,158 1,034,146
Change in excess State money - - - - -
Difference between expected and actual
experience 705,395 (137,974) 195,967 (130,811) 103,400
Change of assumptions 1,042,161 - - (478,322) -
Other - 19,500 - - -
Benefit payments, including refunds of
of employee contributions (722,934) (735,428) (815,563) (693,227) (715,876)
Net change in total pension liability 2,694,168 737,008 894,126 184,615 790,759
Total pension liability, beginning 17,916,032 17,179,024 16,284,898 16,100,283 15,309,524
Total pension liability, ending (a) $ 20,610,200 $ 17,916,032 $ 17,179,024 $ 16,284,898 $ 16,100,283
Plan fiduciary net position
Contributions - City $ 451,228 $ 558,351 $ 779,224 $ 870,477 $ 745,022
Contributions - State of Florida - 165,133 144,821 274,267 132,844
Contributions - Employee 215,508 215,375 177,828 168,456 161,166
Net investment income (loss) 3,384,767 1,742,688 (2,535,548) 2,896,388 607,277
Benefit payments, including refunds of
employee contributions (743,052) (735,428) (815,563) (693,227) (715,876)
Administrative expenses (61,096) (26,723) (41,743) (34,284) (35,623)
Other - - - - -
Net change in plan fiduciary net position 3,247,355 1,919,396 (2,290,981) 3,482,077 894,810
Plan fiduciary net position, beginning 16,263,678 14,344,282 16,635,263 13,153,186 12,258,376
Plan fiduciary net position, ending (b) $ 19,511,033 $ 16,263,678 $ 14,344,282 $ 16,635,263 $ 13,153,186
Net pension liability (asset) (a)-(b) $ 1,099,167 $ 1,652,354 $ 2,834,742 $ (350,365) $ 2,947,097
Plan fiduciary net position as a percentage
of total pension liability 94.67% 90.78% 83.50% 102.15% 81.70%
Covered payroll $ 2,660,125 $ 2,448,438 $ 2,222,850 $ 2,105,700 $ 2,014,575
Net pension liability as a percentage of
covered payroll 41.32% 67.49% 127.53% -16.64% 146.29%
Continued...
69
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS - POLICE OFFICERS’ PENSION PLAN
City reporting period date 9/30/2020 9/30/2019 9/30/2018 9/30/2017 9/30/2016
Measurement date 9/30/2019 9/30/2018 9/30/2017 9/30/2016 9/30/2015
Total pension liability
Service cost $ 332,419 $ 329,254 $ 335,185 $ 279,863 $ 291,761
Interest 1,026,422 1,016,983 970,877 931,370 900,982
Change in excess State money - (120,454) - - 120,454
Difference between expected and actual
experience (351,261) (209,232) 187,216 (2,998) (213,426)
Change of assumptions - 454,983 (40,955) - -
Other - - - - -
Benefit payments, including refunds of
of employee contributions (1,143,778) (690,688) (643,872) (754,465) (553,042)
Net change in total pension liability (136,198) 780,846 808,451 453,770 546,729
Total pension liability, beginning 15,445,722 14,664,876 13,856,425 13,402,655 12,855,926
Total pension liability, ending (a) $ 15,309,524 $ 15,445,722 $ 14,664,876 $ 13,856,425 $ 13,402,655
Plan fiduciary net position
Contributions - City $ 826,705 $ 854,780 $ 945,540 $ 729,483 $ 574,014
Contributions - State of Florida - 236,772 - 112,972 103,528
Contributions - Employee 142,024 131,498 129,552 117,274 112,354
Net investment income (loss) 307,543 853,894 950,447 804,901 43,534
Benefit payments, including refunds of
employee contributions (1,143,777) (690,688) (643,872) (754,465) (553,042)
Administrative expenses (38,763) (25,152) (51,481) (29,933) (35,984)
Other (change in excess State money) - - - - 120,454
Net change in plan fiduciary net position 93,732 1,361,104 1,330,186 980,232 364,858
Plan fiduciary net position, beginning 12,164,644 10,803,540 9,473,354 8,493,122 8,128,264
Plan fiduciary net position, ending (b) $ 12,258,376 $ 12,164,644 $ 10,803,540 $ 9,473,354 $ 8,493,122
Net pension liability (asset) (a)-(b) $ 3,051,148 $ 3,281,078 $ 3,861,336 $ 4,383,071 $ 4,909,533
Plan fiduciary net position as a percentage
of total pension liability 80.07% 78.76% 73.67% 68.37% 63.37%
Covered payroll $ 1,775,300 $ 1,643,725 $ 1,619,400 $ 1,465,925 $ 1,404,425
Net pension liability as a percentage of
covered payroll 171.87% 199.61% 238.44% 299.00% 349.58%
Change of Assumptions:
For measurement date September 30, 2024:
• The assumed investment return assumption was reduced from 6.75% to 6.25%.
For measurement date September 30, 2021:
• Reflects updated mortality tables to those used by Florida Retirement System (FRS) as mandated by Section 112.63(1)(f),
Florida Statutes.
For measurement date September 30, 2018:
• The assumed investment return assumption was reduced from 7.00% to 6.75%.
• The assumed rates of salary increase, retirement and withdrawal were revised based on a 7 -year experience study
performed for the Plan.
70
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CONTRIBUTIONS – ALL PENSION PLANS
Contributions
in Relation to Contributions
Year Actuarially the Actuarially Contribution as a % of
Ended Determined Determined Excess Covered Covered
September 30, Contribution Contribution (Deficiency) Payroll Payroll
General Employees' Plan
2024 $ 352,301 $ 689,268 $ 336,967 $ 1,212,067 56.87%
2023 $ 850,265 $ 850,266 $ 1 $ 1,263,067 67.32%
2022 $ 1,099,876 $ 1,099,884 $ 8 $ 1,363,833 80.65%
2021 $ 1,248,604 $ 1,248,604 $ - $ 1,453,483 85.90%
2020 $ 1,355,973 $ 1,362,952 $ 6,979 $ 1,615,350 84.38%
2019 $ 1,424,479 $ 1,424,479 $ - $ 1,795,750 79.33%
2018 $ 1,332,118 $ 1,332,119 $ 1 $ 1,958,933 68.00%
2017 $ 1,175,572 $ 1,175,572 $ - $ 2,067,067 56.87%
2016 $ 1,112,344 $ 1,112,344 $ - $ 2,136,733 52.06%
2015 $ 863,613 $ 863,613 $ - $ 2,269,850 38.05%
Police Officers' Plan
2024 $ 449,957 $ 451,228 $ 1,271 $ 2,660,125 16.96%
2023 $ 483,076 $ 723,484 $ 240,408 $ 2,448,438 29.55%
2022 $ 579,249 $ 924,045 $ 344,796 $ 2,222,850 41.57%
2021 $ 668,499 $ 1,144,744 $ 476,245 $ 2,105,700 54.36%
2020 $ 668,090 $ 877,866 $ 209,776 $ 2,014,575 43.58%
2019 $ 826,705 $ 826,705 $ - $ 1,775,300 46.57%
2018 $ 841,726 $ 1,091,552 $ 249,826 $ 1,643,725 66.41%
2017 $ 849,061 $ 945,540 $ 96,479 $ 1,619,400 58.39%
2016 $ 825,700 $ 842,455 $ 16,755 $ 1,465,925 57.47%
2015 $ 665,091 $ 677,542 $ 12,451 $ 1,404,425 48.24%
71
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO THE SCHEDULE OF CONTRIBUTIONS – ALL PENSION PLANS
Significant methods and assumptions used in calculating the actuarially determined contributions:
The following pertain to both City’s defined benefit pension plans unless separately stated.
• Valuation Date: October 1, 2022. Actuarially determined contribution rates are calculated as of September 30, two years
prior to the end of the fiscal year in which contributions are required.
• Actuarial Cost Method: Entry Age Actuarial Cost Method
• Amortization Method:
o General Employees’ Plan – Closed, Level Dollar Method
o Police Officers’ Plan - Closed, Level % of Pay Method
• Remaining Amortization Period:
o General Employees’ Plan – 10 Years.
o Police Officers’ Plan - 28 years.
• Asset Valuation Method: 4-year smoothed market value where the difference between the expected and actual return
on market value of assets is phased in over a period of four years at a rate of 25% per year.
• Inflation:2.50%
• Salary Increases:
o General Employees Plan – Age Based ranging from 9.5% at age 20 to 4.8% at age 60+ (including 2.5% price
inflation).
o Police Officers’ Plan – Age Based ranging from 18.5% at age 20 to 4.5% at age 60+ (including 2.5% price inflation).
• Payroll Growth:
o General Employees Plan – None
o Police Officers’ Plan – 3.50%
• Investment Rate of Return: 6.75% per year compounded annually, net of investment expenses, including inflation.
• Retirement Age: Experience-based table of rates (from Experience Study dated August 9, 2017 for the period October 1,
2009 to September 30, 2016) that vary by age.
• Mortality:
o General Employees’ Plan – Pub-2010 Headcount-Weighted Mortality Tables used by the Florida Retirement
System for Regular Class members in their July 1, 2020 actuarial valuations with mortality improvements
projected for healthy lives to all future years after 2010 using Scale MP-2018.
o Police Officers’ Plan - Pub-2010 Headcount-Weighted Mortality Tables used by the Florida Retirement System for
Special Risk Class members in their July 1, 2020 actuarial valuations with mortality improvements projected for
healthy lives to all future years after 2010 using Scale MP-2018.
o Previous Mortality Tables Used: RP-2000 Combined Healthy Participant Mortality Table (for preretirement
mortality) and the RP-2000 Mortality Table for Annuitants (for postretirement mortality), with mortality
improvements projected to all future years after 2000 using Scale BB.
72
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF INVESTMENT RETURNS – ALL PENSION PLANS
Year Ended September 30,
2024 2023 2022 2021 2020 2019 2018 2017 2016
General Employees' Plan
Annual money-weighted rate of return
net of investment expenses 22.38% 14.05% -16.01% 23.65% 6.41% 4.04% 8.67% 10.92% 10.18%
Police Officers' Plan
Annual money-weighted rate of return
net of investment expenses 22.47% 6.13% -14.98% 23.67% 6.15% 4.38% 8.26% 10.80% 9.93%
73
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS
Reporting date 9/30/2024 9/30/2023 9/30/2022 9/30/2021
Measurement date 9/30/2023 9/30/2022 9/30/2021 9/30/2020
Total OPEB Liability
Service cost $ 36,840 $ 55,813 $ 56,159 $ 55,135
Interest 17,072 9,684 11,124 11,812
Difference between expected
and actual experience (73,297) - (20,135) -
Changes in assumptions (3,620) (86,543) (56,642) (26,153)
Benefit payments (17,200) (11,158) (7,902) (11,666)
Net change in total OPEB Liability (40,205) (32,204) (17,396) 29,128
Total OPEB Liability - beginning 359,755 391,959 409,355 380,227
Total OPEB Liability - ending $ 319,550 $ 359,755 $ 391,959 $ 409,355
Covered-employee payroll $ 7,144,276 $ 8,066,712 $ 5,961,844 $ 7,602,334
Total OPEB liability as a percentage
of covered-employee payroll 4.47% 4.46% 6.57% 5.38%
Reporting date 9/30/2020 9/30/2019 9/30/2018
Measurement date 9/30/2019 9/30/2018 9/30/2017
Total OPEB Liability
Service cost $ 38,095 $ 39,404 $ 41,222
Interest 19,049 16,906 14,667
Difference between expected
and actual experience (203,632) - -
Changes in assumptions 78,146 (18,238) (21,261)
Benefit payments (21,386) (23,456) (22,404)
Net change in total OPEB Liability (89,728) 14,616 12,224
Total OPEB Liability - beginning 469,955 455,339 443,115
Total OPEB Liability - ending $ 380,227 $ 469,955 $ 455,339
Covered-employee payroll $ 5,196,501 $ 6,647,363 $ 6,272,956
Total OPEB liability as a percentage
of covered-employee payroll 7.32% 7.07% 7.26%
Continued…
74
CITY OF ATLANTIC BEACH, FLORIDA
NOTES TO THE SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS
No assets are being accumulated in a trust to pay for plan benefits.
Changes in Assumptions:
Changes in assumptions reflect the effects of changes in the discount rate of each period. The following are the
discount rates used for each measurement date.
Measurement Date Discount Rate
September 30, 2023 4.63%
September 30, 2022 4.40%
September 30, 2021 2.19%
September 30, 2020 2.41%
September 30, 2019 2.75%
September 30, 2018 3.83%
September 30, 2017 3.50%
September 30, 2016 3.10%
Additional changes in assumptions for the following measurement dates:
• September 30, 2021
o Per capita costs and premiums were updated based on information provided.
o Long-term trend rates of healthcare increases were lowered from 3.99% to 3.75%.
• September 30, 2019
o Per capita costs and premiums were updated based on information provided.
o Assumed ultimate rate of inflation was revised from 2.5% to 2.25% and the healthcare cost trend
assumption was revised to reflect this change.
Additional years will be added to this schedule annually until 10 years; data is presented.
SUPPLEMENTARY INFORMATION
75
CITY OF ATLANTIC BEACH, FLORIDA
COMBINING BALANCE SHEET – NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Special Revenue Funds
Local Convention
Tree Option Development Half-Cent Court Cost Parking Radio
Replacement Gas Tax Tax Sales Tax Training Facilities Communication
ASSETS
Equity in pooled cash and investments $ 325,755 $ - $ 161,186 $ 243,702 $ - $ 253,663 $ 203,552
Receivables, net
Intergovernmental and other - 123,273 30,972 221,216 495 14,899 2,410
Prepaid expenditures - - - - - - -
TOTAL ASSETS $ 325,755 $ 123,273 $ 192,158 $ 464,918 $ 495 $ 268,562 $ 205,962
LIABILITIES
Accounts payable and accrued liabilities - - - 6,595 400 - -
Construction costs payable - - - 4,212 - - -
Accrued payroll - - - - - - -
Accrued claims payable - - - - - - -
Due to other governments - - - - - - -
Due to other funds - 363,630 - - 36,583 - -
Deposits - - - - - - -
TOTAL LIABILITIES - 363,630 - 10,807 36,983 - -
FUND BALANCE
Nonspendable:
Prepaids - - - - - - -
Restricted for:
Public safety - - - - - - 205,962
Road maintenance and construction - - - 454,111 - - -
Other capital projects - - - - - - -
Other purposes - - 192,158 - - 268,562 -
Committed to:
Conservation and resource management 325,755 - - - - - -
Unassigned - (240,357) - - (36,488) - -
TOTAL FUND BALANCES 325,755 (240,357) 192,158 454,111 (36,488) 268,562 205,962
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCE $ 325,755 $ 123,273 $ 192,158 $ 464,918 $ 495 $ 268,562 $ 205,962
Continued…
76
CITY OF ATLANTIC BEACH, FLORIDA
COMBINING BALANCE SHEET – NON-MAJOR GOVERNMENTAL FUNDS (CONCLUDED)
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Special Revenue Funds
Total Totals
Community Special Non-Major
Contraband Development Police Revenue Debt Governmental 2023
Revenue Block Grants Grants Funds Service Funds Totals
ASSETS
Equity in pooled cash and investments $ 10,087 $ 109,093 $ 2,130 $ 1,309,168 $ - $ 1,309,168 $ 945,736
Receivables, net
Intergovernmental and other - 100 - 393,365 - 393,365 361,665
Prepaid expenditures - - - - - - 13,649
TOTAL ASSETS $ 10,087 $ 109,193 $ 2,130 $ 1,702,533 $ - $ 1,702,533 $ 1,321,050
LIABILITIES
Accounts payable and accrued liabilities - - - 6,995 - 6,995 36,710
Construction costs payable - 3,133 - 7,345 - 7,345 7,346
Due to other funds - - - 400,213 19,848 420,061 474,617
Deposits 2,998 - - 2,998 - 2,998 2,998
TOTAL LIABILITIES 2,998 3,133 - 417,551 19,848 437,399 521,671
FUND BALANCE
Nonspendable:
Prepaids - - - - - - 13,649
Restricted for:
Public safety 7,089 - 2,130 215,181 - 215,181 170,957
Road maintenance and construction - - - 454,111 - 454,111 83,060
Other capital projects - 106,060 - 106,060 - 106,060 -
Other purposes - - - 460,720 - 460,720 431,731
Committed to:
Conservation and resource management - - - 325,755 - 325,755 262,215
Unassigned - - - (276,845) (19,848) (296,693) (162,233)
TOTAL FUND BALANCES 7,089 106,060 2,130 1,284,982 (19,848) 1,265,134 799,379
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCE $ 10,087 $ 109,193 $ 2,130 $ 1,702,533 $ - $ 1,702,533 $ 1,321,050
77
CITY OF ATLANTIC BEACH, FLORIDA
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Special Revenue Funds
Local Convention
Tree Option Development Half-Cent Court Cost Parking Radio
Replacement Gas Tax Tax Sales Tax Training Facilities Communication
REVENUES:
Non-property taxes $ - $ 713,344 $ 173,773 $ 1,270,973 $ - $ - $ -
Intergovernmental revenue - - - - - - -
Charges for services - - - - - 94,491 -
Fines and forfeitures 104,462 - - - 7,580 - 34,652
Investment earnings (loss) - - 7,078 (6,144) - - 9,024
Miscellaneous revenues 375 - - - - - -
Total revenues 104,837 713,344 180,851 1,264,829 7,580 94,491 43,676
EXPENDITURES:
General government 41,297 - - - - - -
Public safety - - - - 25,370 - -
Capital outlay - - - 51,126 - 13,649 -
Debt service - - - - - - -
Total expenditures 41,297 - - 51,126 25,370 13,649 -
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 63,540 713,344 180,851 1,213,703 (17,790) 80,842 43,676
OTHER FINANCING SOURCES (USES)
Transfers in - - - - - - -
Transfers (out) - (759,600) (122,364) (842,652) 21,996 (110,340) -
TOTAL OTHER FINANCING SOURCES (USES) - (759,600) (122,364) (842,652) 21,996 (110,340) -
NET CHANGE IN FUND BALANCE 63,540 (46,256) 58,487 371,051 4,206 (29,498) 43,676
FUND BALANCE, beginning of year 262,215 (194,101) 133,671 83,060 (40,694) 298,060 162,286
FUND BALANCE, end of year $ 325,755 $ (240,357) $ 192,158 $ 454,111 $ (36,488) $ 268,562 $ 205,962
Continued…
78
CITY OF ATLANTIC BEACH, FLORIDA
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – NON-MAJOR GOVERNMENTAL FUNDS (CONCLUDED)
FOR THE YEAR ENDED SEPTEMBER 30, 2024
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023
2024
Special Revenue Funds
Total Totals
Community Special Non-Major
Contraband Development Police Revenue Debt Governmental 2023
Revenue Block Grants Grants Funds Service Funds Totals
REVENUES:
Non-property taxes $ - $ - $ - $ 2,158,090 $ - $ 2,158,090 $ 2,151,106
Intergovernmental revenue - 269,091 58,956 328,047 - 328,047 170,300
Charges for services - - - 94,491 - 94,491 118,337
Fines and forfeitures - - - 146,694 - 146,694 87,128
Investment earnings (loss) 548 - - 10,506 - 10,506 13,838
Miscellaneous revenues - - - 375 - 375 25,683
Total revenues 548 269,091 58,956 2,738,203 - 2,738,203 2,566,392
EXPENDITURES:
General government - - - 41,297 - 41,297 27,767
Public safety - - 5,948 31,318 - 31,318 35,597
Capital outlay - 269,090 53,008 386,873 - 386,873 650,000
Debt service - - - - 122,364 122,364 120,291
Total expenditures - 269,090 58,956 459,488 122,364 581,852 833,655
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 548 1 - 2,278,715 (122,364) 2,156,351 1,732,737
OTHER FINANCING SOURCES (USES)
Transfers in - 130,704 - 152,700 122,364 275,064 221,543
Transfers (out) - (130,704) - (1,965,660) - (1,965,660) (2,446,617)
TOTAL OTHER FINANCING SOURCES
(USES) - - - (1,812,960) 122,364 (1,690,596) (2,225,074)
NET CHANGE IN FUND BALANCE 548 1 - 465,755 - 465,755 (492,337)
FUND BALANCE, beginning of year 6,541 106,059 2,130 819,227 (19,848) 799,379 1,291,716
FUND BALANCE, end of year $ 7,089 $ 106,060 $ 2,130 $ 1,284,982 $ (19,848) $ 1,265,134 $ 799,379
79
CITY OF ATLANTIC BEACH, FLORIDA
HISTORICAL REVENUES AND EXPENSES
FOR THE YEARS ENDED SEPTEMBER 30, 2020, THROUGH SEPTEMBER 30, 2024
2024 2023 2022 2021 2020
Revenues
Operating Revenues:
Water:
Customer charges $ 3,854,691 $ 3,978,479 $ 3,677,424 $ 3,550,004 $ 3,462,039
Miscellaneous charges 42,005 75,304 68,937 43,252 67,291
Total water 3,896,696 4,053,783 3,746,361 3,593,256 3,529,330
Sewer:
Customer charges 6,512,565 6,444,184 6,096,086 5,750,479 5,399,935
Miscellaneous charges - - 8 - -
Total sewer 6,512,565 6,444,184 6,096,094 5,750,479 5,399,935
Total operating revenues 10,409,261 10,497,967 9,842,455 9,343,735 8,929,265
Non-operating revenues
Investment income (loss):
Water 546,803 232,689 (27,591) 143,198 163,209
Sewer 367,542 119,772 (22,584) 158,264 115,389
Total non-operating revenues 914,345 352,461 (50,175) 301,462 278,598
Total revenues 11,323,606 10,850,428 9,792,280 9,645,197 9,207,863
Expenses
Operating expenses:
Water 1,821,131 1,828,346 1,321,892 1,044,002 1,299,974
Sewer 3,258,657 3,120,083 3,100,956 2,222,833 2,387,924
Total operating expenses 5,079,788 4,948,429 4,422,848 3,266,835 3,687,898
Administrative, non divisional
and other
Water 453,420 453,424 584,856 642,424 508,655
Sewer 659,376 659,352 698,988 678,890 624,796
Total administrative non-
divisional and other 1,112,796 1,112,776 1,283,844 1,321,314 1,133,451
Total expenses 6,192,584 6,061,205 5,706,692 4,588,149 4,821,349
Net revenues available for
debt service 5,131,022 4,789,223 4,085,588 5,057,048 4,386,514
Non-operating income(expense)
Interest expense (125,603) (160,740) (320,482) (344,186) (381,546)
Loan amortization (93,911) (93,911) (93,910) (93,910) (93,910)
Total non-operating income
(expense) (219,514) (254,651) (414,392) (438,096) (475,456)
Change in net position before
depreciation expense and
interfund transfers $ 4,911,508 $ 4,534,572 $ 3,671,196 $ 4,618,952 $ 3,911,058
80
CITY OF ATLANTIC BEACH, FLORIDA
SCHEDULES OF NET REVENUES IN ACCORDANCE WITH BOND RESOLUTIONS – ENTERPRISE FUNDS (WATER AND SEWER)
FOR THE YEARS ENDED SEPTEMBER 30, 2024 AND SEPTEMBER 30, 2023
2024 2023
Gross revenues:
Utility $ 10,409,261 $ 10,497,967
Connection charges 12,595 37,806
Investment income (loss) 1,030,312 396,055
Total Gross Revenues 11,452,168 10,931,828
Operating Expenses
Personnel services 2,295,544 2,217,898
Contractual services 1,131,021 758,088
Supplies 529,113 504,067
Repairs and maintenance 270,623 758,342
Utilities 383,890 400,159
Intergovernmental charges 1,112,796 1,112,776
Other expenses 469,597 309,875
Total operating expenses 6,192,584 6,061,205
Total net revenues in accordance with Bond resolutions $ 5,259,584 $ 4,870,623
Total debt service $ 1,780,156 $ 1,780,844
Debt service coverage ratio 295.46% 273.50%
Required debt service coverage ratio 110.00% 110.00%
81
CITY OF ATLANTIC BEACH, FLORIDA
OTHER BOND COVENANT DISCLOSURES
FOR THE YEAR ENDED SEPTEMBER 30, 2020, THROUGH SEPTEMBER 30, 2024
Utility Service Tax Collections
(last five years)
Year Electricity Communications Gas Fuel Oil Total
2024 $ 520,037 $ 572,639 $ 16,079 $ - $ 1,108,755
2023 501,495 549,318 12,926 - 1,063,739
2022 515,491 525,166 12,966 - 1,053,623
2021 441,950 471,029 13,068 - 926,047
2020 499,712 489,444 14,122 - 1,003,278
Ad Valorem Tax Collections
(last five years)
Year Total
2024 $ 7,241,664
2023 7,224,605
2022 6,708,984
2021 6,341,798
2020 5,912,053
OTHER STATISTICAL INFORMATION
82
CITY OF ATLANTIC BEACH, FLORIDA
MAJOR UTILITY CUSTOMERS
FOR THE YEAR ENDED SEPTEMBER 30, 2024
(UNAUDITED)
Annual
Billings
Fleet Landing (retirement community) $ 686,377
Navy (Federal Government) 256,148
Ocean Reef 236,414
Yes Companies 178,709
Puckett Partners 178,370
John's Creek Estates (mobile home park) 165,060
City of Atlantic Beach, Florida 153,256
Hanna Park (regional park) 151,366
One Ocean 139,473
BW MAYPORT LLC 122,952
$ 2,268,125
ADDITIONAL ELEMENTS OF REPORT PREPARED IN ACCORDANCE WITH GOVERNMENT
AUDITING STANDARDS, ISSUED BY THE COMPTROLLER GENERAL OF THE UNITED
STATES; THE RULES OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA; AND
OTHER CONTRACT REQUIREMENTS
83
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
City of Atlantic Beach, Florida, (the City) as of and for the year ended September 30, 2024, and the related
notes to the financial statements, which collectively comprise the City’s basic financial statements, and
have issued our report thereon dated September 30, 2025.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control
over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in
the circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do
not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A
significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe
than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may
exist that were not identified. We identified a certain deficiency in internal control, described below as
Finding 2024-001 that we consider to be a material weakness.
84
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
2024-001 – Financial Close and Reporting – (Repeat Comment)
Condition – At commencement of final fieldwork, we noted multiple areas that were not completed or
required significant audit adjustments to complete the financial close for the year. As a result, this
resulted in a significant delay in the completion of the audit and failure to meet the statutory due date.
The following audit adjustments were material to the financial statements:
■Reduce accounts payable and related expenditures for improperly accrued items. This resulted in a
reduction of accounts payable and related expenditures of approximately $828k.
■Correction to Water/Sewer Fund accounts receivable and deferred revenue in the amount of $310k.
■Additional accruals for state sharing and related accounts receivable and revenues in the approximate
amount of $500k.
■Correction to record $1M land purchase to record to general fixed asset account group. This was
correctly booked to capital outlay on the fund level but was not picked up on the general fixed asset
account group.
Effect – As a result, the audit was not completed by the statutory due date of June 30, 2025, and the City’s
financial statements would have been materially misstated if adjustments noted above had not been
identified during the audit process.
Recommendation – We recommend that management reviews key financial closing processes and make
corrections as deemed necessary.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, non-compliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion on compliance with
those provisions was not an objective of our audit and, accordingly, we do not express such an opinion.
The results of our tests disclosed no instances of non-compliance or other matters that are required to be
reported under Government Auditing Standards.
City’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the City’s response
to the findings identified in our audit and described in the accompanying schedule of findings. The City’s
response was not subjected to the other auditing procedures applied in the audit of the financial
statements and, accordingly, we express no opinion on the response.
85
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the City’s internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
September 30, 2025
Gainesville, Florida
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INDEPENDENT ACCOUNTANT’S REPORT ON COMPLIANCE
WITH FLORIDA STATUTES SECTION 218.415 – INVESTMENTS OF PUBLIC FUNDS
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
We have examined the City of Atlantic Beach, Florida’s (the City) compliance with Section 218.415, Florida
Statutes during the period ended September 30, 2024, as required by Section 10.556(10)(a), Rules of the
Auditor General. Management is responsible for the City’s compliance with those requirements. Our
responsibility is to express an opinion on the City’s compliance based on our examination.
Our examination was conducted in accordance with attestation standards established by the American
Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence
about the City’s compliance with those requirements and performing such other procedures as we
considered necessary in the circumstances. We believe that our examination provides a reasonable basis
for our opinion. Our examination does not provide a legal determination of the City’s compliance with
specified requirements.
We are required to be independent of the City and to meet our other ethical responsibilities in accordance
with relevant ethical requirements relating to the engagement.
In our opinion, the City complied, in all material respects, with the aforementioned requirements for the
year ended September 30, 2024.
This report is intended solely for the information and use of the Legislative Auditing Committee, members
of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, federal and
other granting agencies and pass-through entities, the City, and its management, and is not intended to
be, and should not be, used by anyone other than these specified parties.
September 30, 2025
Gainesville, Florida
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REPORT ON COMPLIANCE FOR THE U.S. TREASURY CORONAVIRUS STATE AND LOCAL FISCAL
RECOVERY FUNDS PROGRAM (CSLFRF) REQUIREMENTS FOR AN ALTERNATIVE CSLFRF COMPLIANCE
EXAMINATION ENGAGEMENT
INDEPENDENT ACCOUNTANT’S REPORT
To Honorable Mayor, City Commissioners,
and City Manager
City of Atlantic Beach
Atlantic Beach, Florida
We have examined the City of Atlantic Beach, Florida’s (the City) compliance with the compliance
requirements “activities allowed or unallowed” and “allowable cost/cost principles” (the specified
requirements) as described in Part IV “Requirements for an Alternative Compliance Examination
Engagement for Recipients That Would Otherwise be Required to Undergo a Single Audit or Program-
Specific Audit as a Result of Receiving Coronavirus State and Local Fiscal Recovery Funds” of the CSLFRF
section of the 2024 OMB Compliance Supplement (referred to herein as “Requirements for an Alternative
CSLFRF Compliance Examination Engagement”) during the year ended September 30, 2024. Management
of the City is responsible for the City’s compliance with the specified requirements. Our responsibility is
to express an opinion on the City’s compliance with the specified requirements based on our examination.
Our examination was conducted in accordance with attestation standards established by the American
Institute of Certified Public Accountants; the standards applicable to attestation engagements contained
in Government Auditing Standards, issued by the Comptroller General of the United States; and in the
Requirements for an Alternative CSLFRF Compliance Examination Engagement. Those standards require
that we plan and perform the examination to obtain reasonable assurance about whether the City
complied, in all material respects, with the specified requirements referenced above. An examination
involves performing procedures to obtain evidence about whether the City complied with the specified
requirements. The nature, timing, and extent of the procedures selected depend on our judgment,
including an assessment of the risks of material non-compliance, whether due to fraud or error. We believe
that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion.
We are required to be independent and to meet our other ethical responsibilities in accordance with
relevant ethical requirements relating to the examination engagement.
Our examination does not provide a legal determination on the City’s compliance with specified
requirements.
In our opinion, the City complied, in all material respects, with the specified requirements referenced
above during the year ended September 30, 2024.
September 30, 2025
Gainesville, Florida
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MANAGEMENT LETTER
Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
Report on the Financial Statements
We have audited the financial statements of the City of Atlantic Beach, Florida (the City) as of and for the
year ended September 30, 2024, and have issued our report thereon dated September 30, 2025.
Auditor’s Responsibility
We conducted our audit in accordance with auditing standards generally accepted in the United States of
America; the standards applicable to financial audits contained in Government Auditing Standards, issued
by the Comptroller General of the United States; and Chapter 10.550, Rules of the Auditor General.
Other Reporting Requirements
We have issued our Independent Auditor’s Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance
with Government Auditing Standards, and Independent Accountant’s Report on an examination
conducted in accordance with American Institute of Certified Public Accountants Professional Standards,
AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the
Auditor General. Disclosures in those reports and schedule, which are dated September 30, 2025, should
be considered in conjunction with this management letter.
Prior Audit Findings
Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective
actions have been taken to address findings and recommendations made in the preceding annual financial
report. The prior year finding 2023-001 has not been corrected and is now finding 2024-001.
Official Title and Legal Authority
Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal
authority for the primary government and each component unit of the reporting entity be disclosed in
this management letter, unless disclosed in the notes to the financial statements. This information is
included in Note 1 to the financial statements.
Financial Condition and Management
Sections 10.554(1)(i)5.(a) and 10.556(7), Rules of the Auditor General, require that we apply appropriate
procedures and report the results of our determination as to whether or not the City has met one or more
of the conditions described in Section 218.503(1), Florida Statutes, and identification of the specific
condition(s) met. In connection with our audit, we determined that the City did not meet any of the
conditions described in Section 218.503(1), Florida Statutes.
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Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
MANAGEMENT LETTER
Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial
condition assessment procedures. It is management’s responsibility to monitor the City’s financial
condition, and our financial condition assessment was based in part on representations made by
management and the review of financial information provided by same.
Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations
to improve financial management. In connection with our audit, we did have the following
recommendations:
2024-002 – General Pension Plan Pooled Cash
Condition – During the audit we noted that the general employee’s pension plan had a negative pooled
cash balance of approximately $1M. This was due to the plan using the City’s pooled cash to make benefit
payments and resulted in the Plan owing $1M to the City’s General Fund.
Recommendation – The City should monitor the cashflow needs of the General Employee’s pension plan
and liquidate investments as needed so that sufficient funds are available to pay benefits or other costs
of the pension plan.
2024-003- Sanitation Fund Negative Net Position
Condition – The City increased sanitation rates by 16% which resulted in a positive change in income
before transfers. However, the City transferred $359,000 from the fund up from $179,000 from the prior
year, resulting in an increase of the deficit net position to $488,000.
Recommendation – We recommend that the City review the amount of monies that are being transferred
from the fund or consider arranging a temporary interfund loan.
Property Assessed Clean Energy (PACE) Programs
As required by Section 10.554(1)(i)6.a., Rules of the Auditor General, the City is required to include a
statement as to whether a PACE program authorized pursuant to Section 163.081 or Section 163.082,
Florida Statutes, did/did not operate within the City’s geographical boundaries during the fiscal year under
audit. The City has not authorized the operation of a PACE program, and management is not aware of the
operation of any such program, within its geographical boundaries.
Special District Component Units
Section 10.554(1)(i)5.(d), Rules of the Auditor General, requires that we determine whether or not a
special district that is a component unit of a county, municipality, or special district, provided the financial
information necessary for proper reporting of the component unit, within the audited financial
statements of the county, municipality, or special district in accordance with Section 218.39(3)(b), Florida
Statutes. In connection with our audit, we determined that there were no special district component
units that were required to be reported in accordance with Section 218.39(3)(b), Florida Statutes.
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Honorable Mayor, City Commissioners, and
City Manager
City of Atlantic Beach
Atlantic Beach, Florida
MANAGEMENT LETTER
Additional Matters
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address non-compliance with
provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred,
that have an effect on the financial statements that is less than material, but which warrants the attention
of those charged with governance. In connection with our audit, we did not have any such findings.
Purpose of this Letter
Our management letter is intended solely for the information and use of the Legislative Auditing
Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor
General, federal and other granting agencies, and applicable management, and is not intended to be, and
should not be, used by anyone other than these specified parties.
September 30, 2025
Gainesville, Florida
2024-001 – Financial Close and Reporting – (Repeat Comment)
Condition – At commencement of final fieldwork, we noted multiple areas that were not completed
or required significant audit adjustments to complete the financial close for the year. As a result,
this resulted in a significant delay in the completion of the audit and failure to meet the statutory due
date. The following audit adjustments were material to the financial statements:
■ Reduce accounts payable and related expenditures for improperly accrued items. This resulted
in a reduction of accounts payable and related expenditures of approximately $828k.
■ Correction to Water/Sewer Fund accounts receivable and deferred revenue in the amount of
$310k.
■ Additional accruals for state sharing and related accounts receivable and revenues in the
approximate amount of $500k.
■ Correction to record $1M land purchase to record to general fixed asset account group. This was
correctly booked to capital outlay on the fund level but was not picked up on the general fixed
asset account group.
Effect – As a result, the audit was not completed by the statutory due date of June 30, 2025, and the
City’s financial statements would have been materially misstated if adjustments noted above had
not been identified during the audit process.
Recommendation – We recommend that management reviews key financial closing processes and
make corrections as deemed necessary.
Management Response to Comment 2024-001 – Financial Close and Reporting – (Repeat
Comment)
All the corrections have been made, and staff have been made aware of what went wrong. We’ve discussed both the causes and the necessary changes, so everyone understands how to avoid this in the future. To prevent recurrence, we are putting new measures in place that will include a detailed year-end closing checklist to ensure the process is smoother, faster, and more accurate going forward.
2024-002 – General Pension Plan Pooled Cash and Contribution Payment
Condition – During the audit we noted that the general employee’s pension plan had a negative
pooled cash balance of approximately $1M. This was due to the plan using the City’s pooled cash to
make benefit payments and resulted in the Plan owing $1M to the City’s General Fund. We noted
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that the actuarial contribution required for the plan was approximately 352k; however, the city paid
689k to the plan.
Recommendation – The City should monitor the cashflow needs of the General Employee’s pension
plan and liquidate investments as needed so that sufficient funds are available to pay benefits or
other costs of the pension plan. We recommend that the City make sure to pay the correct required
contribution amount unless they intend to purposefully prepay the contribution.
Management Response to Comment 2024-002 – General Pension Plan Pooled Cash and
Contribution Payment
Going forward, the Finance Department will work closely with the plan’s investment custodians and
actuary to monitor cashflow needs, liquidate investments when appropriate, and ensure that only
the required contribution amount is paid unless the City Commission authorizes prepayment. These
measures will help prevent recurrence and maintain accurate financial reporting for the plan.
2024-003- Sanitation Fund Negative Net Position
Condition – The City increased sanitation rates by 16% which resulted in a positive change in income
before transfers. However, the City transferred $359,000 from the fund up from $179,000 from the
prior year, resulting in an increase of the deficit net position to $488,000.
Recommendation – We recommend that the City review the amount of monies that are being
transferred from the fund or consider arranging a temporary interfund loan.
Management Response to Comment 2024-003- Sanitation Fund Negative Net Position
The City will closely evaluate transfers out of the Sanitation Fund during the budget and year -end
close processes to ensure that they do not jeopardize the fund’s financial stability. In addition,
management will review options such as temporary interfund loans or further adjustments to rates
and expenditures, as necessary, to eliminate the deficit and restore a positive net position over time.
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