CAFR1 NATIONAL POST
WALTER BURIEN
It was for Aurora, CO but it might just as well be for your city. Look at yours and see what jumps out at you.
Clint the writer of the piece that follow it appears had a few things jump out at him when he looked at this CAFR.
Sent FYI from,
Walter Burien - CAFR1.com
This is the CAFR for Aurora, Colorado...
Here is the webpage where you can download the CAFR for Aurora, Colorado. Took two seconds to find.
https://www.auroragov.org/AuroraGov/Departments/Finance/Annual_Financial_Report/index.htm
I typed into my browser: "Aurora Colorado Comprehensive annual financial report 2009" - it's that easy!
Download and use this CAFR to follow along and see where the government (taxpayer) money is hiding in plain sight.
Note: This is the structure that is adhered to in virtually all municipal (city and town) CAFR's. Funds will be listed near the end, and the "Financial analysis" will be at the beginning. For this reason, though with different names, your local CAFR will look very similar and should be set up the same. And county and state CAFR's will have the same funds, and though they look different and have a few more aspects, are structured the same as all governments.
Ok, let's inside the Aurora CAFR... First, understand that this is just the city (municipal corporation), and does not reflect the county, state, or all of the other incorporated municipal cities and unincorporated towns, which would be necessary to add up to get a total look at the wealth of the county or state. Also, the school districts and other districts (water, sewer, etc.) will each have a separate CAFR, as they are also not part of the city government (as listed on the CAFR).
That said, I am going to refer to pages on the report in reverse order. Remember, we are looking at wealth that could be used for more important things as well as wealth that is not being used for anything. And this is not even a complete analysis! It's up to you to follow along and learn:
Page 148-150 - "Golf Fund" - It is very common to hold wealth in these types of funds. Golf courses are owned by local and sometimes other state governments. These are often referred to as business activities in the CAFR statement of liabilities and assets, but are called "Enterprise Operations" in the government circles.
Net Assets in this fund as of December 31, 2009 - $24,927,256
Page 148 (INCREASE (DECREASE)IN NET ASSETS) - Note that the CAFR reports a loss in assets for this golf fund of $219,398 for 2009. But remember that the CAFR is an accumulative look at assets, and so the fund has more money in it than it did in 2006. In 2007, the fund earned $389,119.
Page 148 under (NON-OPERATING EXPENSES) - INVESTMENT INCOME, MISCELLANEOUS REVENUE, ETC. - the money in this fund isn't just sitting there, it is being invested. Thus, "Investment Income" is listed. "Non-Operating Expenses" refer to items happening outside of the care and budgetary obligations of the golf courses. This investment game is why the fund is showing a negative year of 219,398. These type of +/- listing of revenue and assets are very deceiving, as we cannot see in this CAFR how the money is invested, what is transferred out of this fund and into others, or day to day investment activity.
Make no mistake, golf courses are businesses (enterprise operations) that are making profits for government (municipal) corporations.
Page 144 - 147 - "Waste Water Fund" - Once again, the management of water and sewage type of "business activities" is not only a profitable business (and a government monopoly for that matter, often sold to private corporations to manage under government control as public-private-partnerships (PPP)), but also have these funds created to build a power base of investment wealth.
Page 144 - Statement of Net Assets for Waste Water Fund - NET ASSETS - DECEMBER 2009 - show that this fund alone has $430,862,335 in wealth, that could be used for other taxpayer budgetary obligations. But as we can see, the INVESTMENT INCOME for this fund is quite nice, at $4,363,954 for fiscal year 2009. Over about 15 million for the last three years.
This fund grew by $20.89 million (INCREASE IN NET ASSETS) in 2009 even after (TRANSFERS OUT) of over $10 million.
Also, this fund has grown steadilly for the last 5 years, from $305 million in 2005, to over 430 million in 2009. Again, the CAFR is the cumulative look at government wealth and investment income. The taxpayer budget released to the people is not.
Page 137 - 143 - "Water Fund" - This is the drinking water fund. similarly to the other funds, this is money that could be used for other purposes. In this case, we start to see the vast wealth the city is hiding within these funds...
Page 137 - Changes in Net Assets for Water Fund - NET ASSETS - DECEMBER 2009 - show total monies for this fund at $944,082,042 - That's almost $1 billion dollars for just this fund alone!!!
Again, this fund is investing the money, and shows investment income of over $11 million.
Net assets increased over 2008 totals by 62,555,533 (INCREASE IN NET ASSETS).
And since December 31, 2005, this fund has grown by over $322 million dollars!!!
*Note that on page 140, the city lists its top water consumers (TEN LARGEST TREATED WATER CUSTOMERS). If you think about it carefully, you will see how smooth of a business these municipal corporations have carved out for themselves. The city is the city's largest water consumer. But it doesn't pay for its own water consumption... the taxpayers do! It bills itself, and deducts the bill from taxpayer funds!!! Brilliant. Come on, you gotta give these guys points for creativity, right?
Page 135 - 136 - Exhibit C3 - Take a quick look at this graph. It gives you an idea of how much the city receives compared to what it has written as the budgetary requirement for what these particular funds service. This shows net assets for the General Fund, the TABOR Reserve Fund, and Policy Reserve Funds...
Page 136 - FUNDS AVAILABLE DECEMBER 31 (2009) - Look at how the "budget" section is lower than the "actual" for each year by millions of dollars. In other words, they had money left over, which of course they either reinvest or use elsewhere, or transfer out of the fund.
Page 136 - FUND BALANCE end of fiscal year 2009 was $52,245,924. Again, money available to be spent on taxpayers.
Page 135 - EXCESS OF REVENUES OVER EXPENDITURES - This states that monies collected (revenues) from the taxpayers in the form of tax, fees, fines, etc... were $24,319,789 more than what was spent. In other words, taxpayers spent way to much money for the services that their government provided, and that money is not refunded back to the taxpayers. Instead, it is placed into these funds we are going over now.
Page 123 - DEMOGRAPHICS AND ECONOMICS - Just throwing this in as a comparative essay, comparing government wealth to the wealth and income of the people of the city.
2009 population of city - 314,326
2009 combined income of city's population - $4,331,333,727 ($4.3 Billion)
2009 unemployment rate - 7.5%
We will come back to these figures at the end of this breakdown...
Page 96 - Just a note to show that indeed the for-profit golf, water, and other funds are called "Enterprise Funds".
Legal Dictionary
Main Entry: en·ter·prise
Pronunciation: 'en-t&r-"prIz
Function: noun : an economic organization or activity; especially : a business organization
5. a company organized for commercial purposes; business firm.
World English Dictionary
enterprise ('?nt??pra?z)
— n
1. a project or undertaking, esp one that requires boldness or effort
2. participation in such projects
3. readiness to embark on new ventures; boldness and energy
4. a. initiative in business
b. ( as modifier ): the enterprise culture
5. a business unit; a company or firm
http://dictionary.reference.com/browse/enterprise
Page 74 - 76 - PENSION TRUST FUNDS - The city actually has two pension funds.
General Employees Retirement Fund (GERP) is listed at $280,221,050 in investment assets.
Elected Official's and Executive Personal Defined Benifit Plan Fund is listed at $3,675,975 in investment assets.
Total monies stashed away in city pension funds - $283,897,025.
Remember, this is extra money in the fund, after all benefits were paid to "employees" for 2009. This is the investment wealth. Employees have no equity in this money, it is a private corporate government fund. If Aurora declares bankruptcy or a host of other ploys, this money will be liquidated, and none of that will be returned to the employees or the taxpayers who have been funding it over the years.
Pension funds are the scam of all scams, and the government employees have been duped into defending them with their souls, not comprehending that it isn't even their money anymore, once they contribute it to the fund!!!
Page 71 -73 - Internal Service Funds - More funds...
Page 72 - Statement of changes in net assets - We see the total for the following 3 Internal Service Funds listed as:
Fleet Management Fund
Print Shop Fund
Risk Management Fund
Totals for these funds are stated as $8,112,000
Again, this could be used for other things. The shell game continues...
Page 61 - 70 - Non-Major Governmental Funds - These are funds which are used to store revenue before it is spent, and to house that extra revenue that is not spent, and to transfer to other funds and liabilities (usually profitable ones).
Too many to list here, but they include Special Revenue Funds, Debt Service Funds, and Capital Projects Funds. Read the descriptions of each to get an idea of what they are used for.
Capital Projects Funds are generally used on construction projects, restoration of infrastructure and buildings, etc... But it is important to understand that these funds are being invested. They can sit around for years before the actual project they are "funding" even gets started. Again, they are places to store revenue (taxpayer collections) while making a profit of investing that money. Evil.
Page 70 - Fund Balances December 31, 2009 - After listing all of these funds out in detail, some in the positive and some in the negative, we can see that these funds total $135,996,298.
***Note that it is likely that the much of these non-major governmental funds are actually designated for specific budgetary items, and the government will tell you this to keep you from claiming that they are hoarding the money. But in reality, there is no law or contract written for these funds that require that money to be used for the purposes they claim. Thus, they can close the fund any time, not use it for its intended purpose, and transfer that money to other funds for their own investment fun! This will be a big debate by the government officials that you approach about using these funds for the benefit of the taxpayers. Do not let them get away with this. Ask them for the specific law or contract that proves their claim. Threaten them with treason and lying under oath, and be sure and film your encounter so that you have a record of their lies. Make them prove everything they say by backing it up with code or law. Good times...
You can read about restricted net assets on page 36.
Page 59 - General Fund Balance - This just states that the general fund has an extra $22,143,755, which was not used in the taxpayer's interest to meet budgetary requirements this year. Instead, taxes are raised.
Page 52 - RISK MANAGEMENT/CONTINGENT LIABILITIES - Just an explanation of how the money placed into funds is invested with the intent to pay for future obligations, in this case lawsuits. Read this entire paragraph in the CAFR a couple of times.
Know that many activities funded by government, including pensions, are actually paid for by the returns from investments by these funds! They even have a fund to pay for "self-insurance" of up to $1,000,000. This means that the city covers their employees with the investment return on some fund somewhere that makes at least a $1,000,000 profit. And I suppose they transfer money from other funds when there is a bad year. I don't believe Aurora is one of those cities, because it has a law which limits lawsuit amounts to $150,000 per person and $600,000 per incident. So private insurance from a carrier is better for this particular city. But that means that the people are out of luck if their claim is for more than the law allows for. Tyranny at it's finest, with state laws that prevent a citizen from collecting proper damages from the private government corporation that caused their loss.
What really bakes my noodle, is that chances are the insurance company that carries the "city" of Aurora is very likely owned by collective government through stock investments! So the more that claims are restricted by the private corporate courts in the "city", the more return on investment for the insurance company, and thus for collective government! Full circle fascism.
Page 47 - PENSION PLANS AND OTHER POST-EMPLOYMENT BENEFITS
Here is the list of actual pension funds offered by the municipality (city). They are bulked into the funds discussed earlier.
The city of Aurora provides the following plans:
General Employees’ Retirement Plan (GERP)
Elected Officials’ and Executive Personnel Defined Benefit Plan (EOEP)
Fire Pension Plan (Old Hire-Fire)
Police Pension Plan (Old Hire-Police)
Other Postemployment Benefits (OPEB)
Fire Department Money Purchase Pension Plan (New Hire-Fire)
Police Department Money Purchase Pension Plan (New Hire-Police)
Executive Retirement Plan – Money Purchase Pension Plan (ERP)
Imagine, this is happening all over the country, in every state, county municipality, district, etc... Each one being funded with taxpayer dollars equal to employee dollars, and sometimes up to 2000% more than what the employees are putting in themselves!
Page 37 - 2. Restricted for Arbitrage - Very Important!!!!
Federal tax law provides that, with the exception of certain “temporary periods”, governments may not invest the proceeds of tax-exempt debt in a higher yielding taxable security. Arbitrage occurs if a government earns more than the yield allowed by law. Excess arbitrage earnings must be rebated to the Federal government. All outstanding bonds and COPs are reviewed annually for potential arbitrage rebate liability and corresponding
reserves are established as necessary.
Arbitrage amounts anticipated to be paid with funds held in the City Debt Service Fund $33,569.
This simply means that when the state, county, city, pension fund, and districts invest their money into certain investments (securities), and then make what you might call an accidental profit above and beyond what is expected due to a glitch in the market system, that money must be given to the Federal government! This is cheating by the way, taking advantage of a mistake to make a profit - buying and then immediately selling for a profit that is an error and will just hurt the rest of the market, which must make up for the mistake somehow. Hard to explain, but the point is that governments across the country all do this, collectively making a fortune for the Fed. Crime of the century if you ask me... This is an arbitrage profit.
So to add insult to injury, part of what the government profits from off of its taxpayers backs while manipulating the markets gets sent to the Federal Government!
And you wonder why this is "allowed" to happen?
You wonder why this isn't against the law???
Page 29 - 30 - CASH AND INVESTMENTS - Just read this section, as it is just telling us that the city has the "right" by state law to invest, and it lists well over $1 billion in investments, much of which we have already covered.
Of course, all investments are not covered. The city makes loans and writes bonds for projects both within and outside of the city. This is listed as a liability, but will of course be an asset when the loan or bond is paid off.
Often the city will put cash in the bank, float a bond of that cash, invest the money in the bank, and then charge taxpayers for the debt service of the bond, while making investment profit on the cash in the bank that the bond was backed by. That's the shell game...
Page 19 - COMPONENT UNITS Statement of net assets - the city is a business. These are the side businesses or "joint-ventures" that the city is involved in.
Add an extra $76,611,082 in assets, over $33,000,000 of which is cash and liquid investments (stocks, etc...).
And finally, last and actually least, since this is a very basic statement, we have the Financial Highlights section, on page MD&A1 (Managers Discussion & Analysis). This is the CAFR for dummies, and is very deceiving because it includes buildings, vehicles, etc... While these are assets, they are not able to be liquidated by law (code). It does include some of the assets we have talked about, but definitely not all, since some funds are not required to be reported in this section, like "non-governmental funds".
But even so, we can see that the city of Aurora is a very wealthy city. It States...
The city’s assets exceeded liabilities at the end of 2009 by $4.3 billion (net assets). Of this amount, $362.4
million, or 8.4% was unrestricted and may be used to meet the city’s ongoing obligations.
Citywide net assets increased $89.4 million in 2009.
This is misleading... as we have uncovered over 900 million in just the Water Fund, remember?
So let's add up just what I have uncovered here in these funds and investments:
Golf Fund = $24,927,256
Waste Water Fund = $430,862,335
Water Fund = $944,082,042
General, TABOR Reserve,
and Policy Reserve Funds = $52,245,924
Pension Trust Funds = $283,897,025
Internal Service Funds = $8,112,000
Non-Governmental Funds = $135,996,298 (This includes the TABOR and Policy Reserve Funds, so - $8,778,851 and $21,332,318, which total $30,111,169)
-$30,111,169
-----------------------------------------------------
$1,850,011,711
So, total unrestricted net assets (investments, cash, etc...) which can be used or liquidated and used for the taxpayer's benefit are at least = $1.85 billion
"I'm sorry that you are on welfare, unemployment, and food-stamps, but we need that money to take care of and acquire new golf courses!" --response by government liar. Government is a for-profit business!!!
In retrospect, the population of this town as stated on the CAFR is 314,326 people.
$1.85 billion equates to the government holding about $5,885 in cash and investments for each person in the city, not including the other assets included in the $4.3 billion stated in the total assets statement (buildings, land, vehicles, etc...).
It also represents about 40% of the total income earned each year by the entire population of the city!
Note: I have no financial background and after having cancer, am a college drop-out.
I was never taught to properly balance my checkbook in high school.
But these reports, while they look scary, are 90% confusing doublespeak, and 10% gold.
Find the gold...
Use this explanation as your guide, and then see what other treasures you can find by simply reading.
Good luck!
-Clint Richardson-