TOWN OF WATERFORD CONNECTICUT FINANCIAL STATEMENTS 2020

TOWN OF WATERFORD, CONNECTICUT 
 
 
 
 
 
 
 
 
 
 
COMPREHENSIVE ANNUAL 
FINANCIAL REPORT 
 
FOR THE FISCAL YEAR ENDED 
JUNE 30, 2020 

 
 
 
 
 
 
 
 
 
 
 
Town of Waterford, Connecticut 
 
Comprehensive Annual Financial Report 
 
FOR THE FISCAL YEAR ENDED 
JUNE 30, 2020 
 
 
 
 
 
 
 
 
 
 
 
 
Department of Finance 
 
Kimberly Allen 
 
Director of Finance 

 
 
Introductory Section 

 
i 
TOWN OF WATERFORD, CONNECTICUT 
TABLE OF CONTENTS 
JUNE 30, 2020 
 
Introductory Section 
Page 
 
 
 
Table of Contents 
i-ii
 
Organizational Chart 
iii
 
List of Elected and Appointed Officials 
iv
 
Transmittal Letter 
v-ix
 
 
 
Financial Section 
 
 
 
Independent Auditors’ Report 
1-3
 
Management’s Discussion and Analysis  
4-12
 
 
 
Basic Financial Statements 
 
 
Exhibit 
 
 
Government-Wide Financial Statements: 
I 
Statement of Net Position 
13
II 
Statement of Activities 
14
 
 
 
Fund Financial Statements: 
III 
Balance Sheet - Governmental Funds 
15-16
IV 
Statement of Revenues, Expenditures and Changes in Fund Balances - 
 
Governmental Funds 
17-18
V 
Statement of Net Position - Proprietary Funds 
19
VI 
Statement of Revenues, Expenses and Changes in Net Position - 
 
Proprietary Funds  
20
VII 
Statement of Cash Flows - Proprietary Funds 
21
VIII 
Statement of Net Position - Fiduciary Funds 
22
IX 
Statement of Changes in Net Position - Fiduciary Funds 
23
 
Notes to the Financial Statements 
24-67
 
 
 
Required Supplementary Information 
 
RSI-1 
Schedule of Revenues and Other Financing Sources - General Fund - Budgetary 
 
   Basis 
68-69
RSI-2 
Schedule of Expenditures and Other Financing Uses Budget and Actual -  
 
 
General Fund - Budgetary Basis 
70-73
RSI-3 
Schedule of Changes in Net Pension Liability and Related Ratios -  
 
Pension Trust Fund 
74
RSI-4 
Schedule of Employer Contributions - Pension Trust Fund 
75
RSI-5 
Schedule of Investment Returns - Pension Trust Fund 
76
RSI-6 
Schedule of the District’s Proportionate Share of the Net Pension Liability - 
 
   Municipal Employees Retirement System 
77
RSI-7 
Schedule of Employer Contributions - Municipal Employees Retirement System 
78
RSI-8 
Schedule of the Town’s Proportionate Share of the Net Pension Liability - 
 
   Teachers Retirement System 
79
RSI-9 
Schedule of Changes in the Net OPEB Liability and Related Ratios - OPEB 
 
   Trust Fund 
80
 
 
 

 
ii 
Exhibit 
 
Page 
 
 
 
RSI-10 
Schedule of Employer Contributions - OPEB Trust Fund 
81
RSI-11 
Schedule of Investment Returns - OPEB Trust Fund 
82
RSI-12 
Schedule of the Town’s Proportionate Share of the Net OPEB Liability - 
 
   Teachers Retirement System 
83
 
 
 
Supplemental, Combining and Individual Fund Statements and Schedules 
 
 
 
 
 
General Fund: 
A-1 
Schedule of Expenditures and Encumbrances Compared with Appropriations 
84
A-2 
Report of Tax Collector - General Fund 
85
A-3 
Schedule of Water Main Assessments Receivable - General Fund 
86
A-4 
Schedule of Sewer Assessments Receivable - General Fund 
87
 
 
 
Nonmajor Governmental Funds: 
B-1 
Combining Balance Sheet - Nonmajor Government Funds 
88-91
B-2 
Combining Statement of Revenues, Expenditures and Changes in Fund Balances 
 
- Nonmajor Governmental Funds 
92-95
 
 
 
Fiduciary Funds: 
C-1 
Combining Statement of Fiduciary Net Position - Pension and Other 
96
 
  Employee Benefit Trust Funds 
C-2 
Combining Statement of Changes in Fiduciary Net Position - Pension and Other 
 
  Employee Benefit Trust Funds 
97
C-3 
Combining Statement of Changes in Assets and Liabilities - Agency Funds 
98
 
 
 
Statistical Section 
 
 
Table 
 
 
Financial Trends: 
1 
Net Position by Component 
99
2 
Changes in Net Position 
100-101
3 
Fund Balances of Governmental Funds 
102
4 
Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 
103
 
Revenue Capacity: 
5 
Assessed and Estimated Actual Value of Taxable Property 
104
6 
Principal Property Taxpayers 
105
7 
Property Tax Levies and Collections 
106
 
Debt Capacity: 
8 
Ratio of Outstanding Debt by Type 
107
9 
Schedule of Debt Limitation 
108
10 
Legal Debt Margin Information 
109
 
Demographic and Economic Statistics: 
11 
Demographic and Economic Statistics 
110
12 
Principal Employers 
111
 
Operating Information: 
13 
Full-Time Equivalent Government Employees by Function/Program 
112
14 
Operating Indicators by Function/Program 
113
15 
Capital Asset Statistics by Function/Program 
114

ORGANIZATIONAL CHART TOWN OF WATERFORD GENERAL GOVERNMENT
Elected Board
Appointed Board
Appointed Official
Appointed by
Reports to
Elected Official
Personnel
Review Board
Ethics
Commission
Police
Chief
Police
Commission
Director of
Senior
Services
Senior
Citizens
Commission
Chief
Engineer
Utility
Commission
Building
Commitee(s)
Representative
Town Meeting
Board of
Education
Zoning Board
of Appeals
Flood &
Erosion Control
Board
Waterford
Shellfish
Commission
Director of
Finance
Department
Waterford
East Lyme
Shellfish Comm.
Harbor
Management
Commission
Youth
Services
Advisory Comm
Housing
Code
Appeals Brd
Building
Board of
Appeals
Housing
Authority
Planning &
Zoning
Commission
Director of
Public Works
Department
Town
Attorney
Director of
Recreation &
Parks Dept.
Recreation &
Parks
Commission
Operations &
Administrative
Officers
Director of
Emergency
Management
Board of
Selectmen
Tax
Collector
Treasurer
Town
Clerk
Assessor
Ledge Light
Health
District
Youth Services
Director
Director
Human
Resources
Director of
Planning
Building
Official
Emergency
Management
Advisory Coun.
Fire Service
Director of
Fire Services
Economic
Development
Commission
Conservation
Commission
First
Selectman
Registrars
of Voters
Board of
Assessment
Appeals
Board of
Finance
iii

 
 
Town of Waterford, Connecticut 
Principal Town Officials 
As of June 30, 2020 
 
 
 
Robert J. Brule, Jr.  
Thomas W. Giard III 
Kimberly Allen  
Abbas Danesh  
Abby Piersall 
Gary Schneider 
Brett Mahoney 
Neftali Soto 
Alan Wilensky 
Paige Walton 
Brian Flaherty 
Lisa Cappuccio 
David Campo 
Daniela Gorman 
John Murphy 
Roslyn Rubenstein 
Bruce A. Miller 
Joyce Sauchuk  
First Selectman 
Superintendent of Schools 
Director of Finance 
Treasurer 
Planning Director 
Director of Public Works 
Chief of Police 
Chief Engineer, Utilities Commission 
Tax Collector 
Assessor 
Recreation & Parks Director 
Director of Senior Services 
Town Clerk 
Director of Youth Services 
Building Official 
Library Director 
Director of Fire Services 
Director of Human Resources 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
iv 

 
v 
 
 
 
November 17, 2020 
 
To the Honorable First Selectman, Representative Town Meeting and the Citizens 
of the Town of Waterford: 
 
State law requires that every general-purpose local government publish within six 
months of the close of each fiscal year a complete set of audited financial 
statements.  This report is published to fulfill that requirement for the fiscal year 
ended June 30, 2020. 
 
Management assumes full responsibility for the completeness and reliability of the 
information contained in this report, based upon a comprehensive framework of 
internal control that it has established for this purpose.  Because the cost of internal 
control should not exceed anticipated benefits, the objective is to provide 
reasonable, rather than absolute, assurance that the financial statements are free 
of any material misstatements. 
 
Blum Shapiro, Certified Public Accountants, have issued an unqualified opinion on 
the Town of Waterford financial statements for the year ended June 30, 2020.  The 
independent auditors’ report is located at the front of the financial section of this 
report. 
 
Management Discussion and Analysis (MD&A) immediately follows the independent 
auditor’s report and provides a narrative introduction, overview and analysis of the 
basic financial statements.  The MD&A complements this letter of transmittal and 
should be read in conjunction with it. 
 
Profile of the Government 
 
The Town of Waterford separated from the City of New London, the neighboring 
urban seaport, a century and a half after European settlers arrived.  Waterford was 
incorporated in 1801.  Covering an area of 33.2 square miles, the Town is located 
in the southeastern region of the state.  Waterford is bordered by the Towns of East 
Lyme to the west, New London, Groton and Ledyard to the east, and Montville to 
the north.  It borders Long Island Sound to the south.  
 
The Town has a Selectmen/Board of Finance/Representative Town Meeting form of 
government.  The Representative Town Meeting exercises the legislative authority 
of the Town.  The Board of Selectmen is composed of three members who are 

 
vi 
elected at large for four-year terms.  The Representative Town Meeting is elected 
for two-year terms.  The First Selectman is the head of the administrative branch of 
the Town Government and is responsible to the Representative Town Meeting for 
the administration of all affairs relating to the Town. 
 
The Town of Waterford provides a full range of services, including police and fire 
protection; the construction and maintenance of highways, streets and other 
infrastructure; municipal solid waste and recycling collection; recreational and 
cultural activities.  Municipal water and sewer services, the Town’s one business-
type activity, are provided through the Town’s Utility Commission. 
 
By Charter, the Representative Town Meeting must hold its Town Budget Meeting 
no later than the first Monday in May each year.  If, within fifteen days of the budget 
adoption no referendum is called, the budget is considered approved.  The annual 
budget serves as the foundation for Town of Waterford financial planning and 
control.  The budget is prepared by Department/Agency at an object level.  With the 
exception of the Police, Recreation and Parks, Senior Services, Utility and Planning 
and Zoning Commissions, Board of Finance, Board of Education, Board of 
Assessment Appeals, Zoning Board of Appeals, Building Board of Appeals, 
Economic Development Commission, Flood & Erosion Control Board, Conservation 
Commission, Retirement Commission, Harbor Management Commission and Ethics 
Commission, all other Town Boards, Commissions or agencies report to the Board 
of Selectmen.  The Board of Selectmen, however, reviews and recommends to the 
Board of Finance the level of appropriation for all municipal budgets with the 
exception of the Board of Education. All agencies have the authority to transfer 
within series any of the budgeted appropriations under their control.  Transfers out 
of series, however, require special approval from the Board of Finance. 
 
Local Economy 
 
Waterford is unique in that its major taxpayer is a nuclear power facility.  However, 
numerous, large retail sales outlets, a production/software development company, 
several assisted care facilities and numerous financial institutions provide a good 
mix to tax base diversification.  The Waterford Tax Base has a diversified tax base 
with immediate access to Routes 1, 95, 395 and 85 all of which are major 
Connecticut arteries.  
 
 
Dominion Power Facility (Millstone) 
◦ 
Impact Analysis Completed 
◦ 
Increase Economic development 
◦ 
Viable Tax payer for at least ten years – Declining tax 
revenue  
◦ 
10-Year Deal 
◦ 
$50M in updates since agreement signed in January 
2019  
 
 
 

 
vii 
Jordan Village District  
◦ 
Anticipated zone change to support the area surrounding an 
established historic district 
◦ 
District will focus on small businesses, small multi-family and 
mixed use projects 
 
Waterford Station 
◦ 
Permitted retail development adjacent to Waterford Commons. 
Successful OSTA review. 
 
Economic Development Commission Master Plan 
◦ 
Emphasis on pushing economic development 
◦ 
Restructure of economic development department 
◦ 
Changes in zoning and permitting to streamline reviews, and 
encourage flexibility for small businesses during COVID-19 
 
New Developments 
◦ 
Victoria Gardens – Age restricted Apartments are complete and 
occupied. 
◦ 
171 Rope Ferry Rd – 52 Units – 40% Affordable Housing under 
construction 
◦ 
22 Minor Lane – 70 Units – 1-2 Bedroom High End Apartments are 
complete and occupied 
◦ 
Approximately 200+ additional units 
◦ 
One 48 unit affordable project development has received 
funding 
◦ 
One 98 unit development has public hearing scheduled for 
September 2020 
◦ 
Seaside – DEEP 
◦ 
33 Acres state owned property redevelopment (Wetlands and 
Planning Permits in progress). 
◦ 
Planning approvals in place for new restaurant and office space at 
Mago Point 
 
New Industry 
◦ 
Cross Rd Surgery – 2000 sq. ft. project completed and developing 
permits filed for an expansion. 
◦ 
Tractor Supply – open 
◦ 
Hartford Healthcare medical offices are underway in former Toys R 
Us property 
◦ 
Ollies Open in former JoAnn Fabrics retail space 
◦ 
Dollar General open in former Rite-Aid building 
 
Electric Boat 
◦ 
$5.1B Navy Contract – estimated 2,000 to 5,000 jobs 
◦ 
Building of Columbia Class Submarines to begin in 2023 
◦ 
Current impact – Increased housing activity 
 

 
viii 
Long Term Financial Planning 
 
In 1998 the Representative Town Meeting formed its Long Range Fiscal Planning 
Committee.  The RTM at the recommendation of this committee commissioned the 
Government Consulting Group to develop a report and make recommendations on 
containing tax increases in light of the reduced revenue base affected by utility 
deregulation.  The RTM Committee was disbanded after the Representative Town 
Meeting accepted the Government Consulting Groups report.  In FY01 the Board of 
Finance appointed an Ad Hoc Long-Range Budget Planning Committee to analyze the 
impact of the annual tax revenue loss due to the Dominion deregulation and to provide 
guidance in developing budgets that would sustain a consistent level of service with a 
declining revenue base over the ten-year period.  This proactive approach to long-range 
operational budget planning, combined with multi-year capital planning, has become an 
effective budgetary management tool.  Despite the fact that the Town has successfully 
absorbed the impact to its tax base due to deregulation, the Long-Range Budget 
Planning Committee remains active and is in the process of developing an updated long-
term financial plan based of GFOA guidelines. 
 
The Town implemented a Fleet Management Program that served as the basis for 
sizing the fleet and provided a 5 year approach to managing a fleet valued in 
excess of $4.4 million.  This program allows the Town to undertake a needs 
assessment of its rolling stock, and based upon established life-cycle parameters, 
provided a forty-year replacement plan that uses a combination of residual values, 
investment income, vehicle rental revenues and an equalized level of budget over a 
sustained period of time to fund all rolling stock replacements. 
 
Major Initiatives 
 
In compliance with GASB 54 and to strengthen Waterford’s commitment to sound 
financial management and fiscal accountability, the Town still maintains the adopted 
fund balance policy from 2015.  In that regard, the Town’s 2019 Audited Financial 
Waterford has an Unassigned Fund Balance of $16,781,193.   
 
In May of 2019, the Town began the first phase of the construction on a new 
Municipal Complex project for the Public Works Department.   The project consists 
of a full demolition of the existing structure and construction of a new 60,100 sq. ft. 
facility. The cost of the project is estimated to be $15,000,000 and completed by 
April of 2021.  A $10M BAN was issued in July of 2019.  The full $15M was bonded 
in July 2020. 
 
Increase school enrollment 
◦ 
Attract students from neighboring districts to Waterford High School 
on a tuition basis 
◦ 
Up to 80 students; 5 students enrolled in 2020 

ix 
Eco Friendly Town 
◦
Achieved Bronze Certificate as a Sustainable CT Community
◦
Land Preservation
◦
Easements, Purchase and Donations
◦
Plan of Conservation and Development
◦
DEEP analysis
◦
Fall 2019-2021
◦
Energy audit of buildings
◦
LED Streetlight conversion project completed
Affordable Housing Plan 
◦
Assessing housing needs for the future
◦
In process of collecting data to fit into regional area needs
Town Center Improvements (“Main Street”) 
◦
Committee Formed in June 2020
◦
Support Infrastructure for Farmer’s Market
◦
Improved Recreational Amenities
◦
Accessible walking paths, sidewalks and boardwalks
◦
Improved Fiber Connectivity
Awards and Acknowledgements 
The Government Finance Officers Association of the United States and Canada 
(GFOA) awarded a Certificate of Excellence in Financial Reporting to the Town for 
its Comprehensive Annual Financial Report in past fiscal years, and the Town will 
be applying for the award again for the 2020 financial statements.  In order to be 
awarded a Certificate of Achievement, the Town publishes an easily readable and 
efficiently organized comprehensive annual financial report.  This report satisfies 
both generally accepted accounting principles and applicable legal requirements. 
Although the preparation of the comprehensive annual financial report is primarily 
the responsibility of the Director of Finance, it could not have been accomplished 
without the support of numerous town staff.  Special recognition goes to the 
Finance department staff.  Without their dedication, oversight and hard work the 
Town could never have achieved this prestigious award.  I appreciate the 
unflagging support of First Selectman Robert Brule, Superintendent of Schools 
Thomas Girard and his staff, as well as, the entire Board of Selectmen, Board of 
Finance and the Representative Town Meeting who continually show their 
commitment to fiscal integrity and financial leadership. 
Respectfully submitted, 
Kimberly Allen 
Director of Finance 
cfa.

 
 
Financial Section 

blumshapiro 
accounting• tax• advisory 
29 South Main Street 
P.O. Box 272000 
West Hartford, CT 06127-2000 
Tel 860.561.4000 
blumshapiro.com 
 
1 
 
 
 
 
 
 
Independent Auditors’ Report 
To the Board of Finance  
Town of Waterford, Connecticut 
Report on the Financial Statements 
We have audited the accompanying financial statements of the governmental activities, the 
business-type activities, each major fund and the aggregate remaining fund information of 
the Town of Waterford, Connecticut, as of and for the year ended June 30, 2020, and the 
related notes to the financial statements, which collectively comprise the Town of Waterford, 
Connecticut’s basic financial statements as listed in the table of contents.   
Management’s Responsibility for the Financial Statements 
Management is responsible for the preparation and fair presentation of these financial 
statements in accordance with accounting principles generally accepted in the United States 
of America; this includes the design, implementation and maintenance of internal control 
relevant to the preparation and fair presentation of financial statements that are free from 
material misstatement, whether due to fraud or error. 
Auditors’ Responsibility  
Our responsibility is to express opinions on these financial statements based on our audit.  
We conducted our audit in accordance with auditing standards generally accepted in the 
United States of America and the standards applicable to financial audits contained in 
Government Auditing Standards, issued by the Comptroller General of the United States.  
Those standards require that we plan and perform the audit to obtain reasonable assurance 
about whether the financial statements are free from material misstatement.   
An audit involves performing procedures to obtain audit evidence about the amounts and 
disclosures in the financial statements.  The procedures selected depend on the auditors’ 
judgment, including the assessment of the risks of material misstatement of the financial 
statements, whether due to fraud or error.  In making those risk assessments, the auditors 
consider internal control relevant to the entity’s preparation and fair presentation of the 
financial statements in order to design audit procedures that are appropriate in the 
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the 
entity’s internal control.  Accordingly, we express no such opinion.  An audit also includes 
evaluating the appropriateness of accounting policies used and the reasonableness of 
significant accounting estimates made by management, as well as evaluating the overall 
presentation of the financial statements. 
We believe that the audit evidence we have obtained is sufficient and appropriate to provide 
a basis for our audit opinions. 

 
2 
Opinions 
In our opinion, the financial statements referred to above present fairly, in all material respects, the 
respective financial position of the governmental activities, the business-type activities, each major fund 
and the aggregate remaining fund information of the Town of Waterford, Connecticut, as of June 30, 
2020 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. 
Other Matters 
Required Supplementary Information 
Accounting principles generally accepted in the United States of America require that the 
management’s discussion and analysis, the budgetary comparison information and the pension and 
OPEB 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, which considers it to be an essential part of financial 
reporting for placing the basic financial statements in an appropriate operational, economic or historical 
context.  We have applied certain limited procedures to the required supplementary information in 
accordance with auditing standards generally accepted in the United States of America, which 
consisted of inquiries of management about the methods of preparing the information and comparing 
the information for consistency with management’s responses to our inquiries, the basic financial 
statements and other knowledge we obtained during our audit of the basic financial statements.  We do 
not express an opinion or provide any assurance on the information because the limited procedures do 
not provide us with sufficient evidence to express an opinion or provide any assurance. 
Other Information 
Our audit was conducted for the purpose of forming opinions on the financial statements that 
collectively comprise the Town of Waterford, Connecticut’s basic financial statements.  The introductory 
section, combining and individual nonmajor fund financial statements and schedules, and statistical 
section are presented for purposes of additional analysis and are not a required part of the basic 
financial statements.   
The combining and individual nonmajor fund financial statements and schedules are the responsibility 
of management and were derived from and relate directly to the underlying accounting and other 
records used to prepare the basic financial statements.  Such information has been subjected to the 
auditing procedures applied in the audit of the basic financial statements and certain additional 
procedures, including comparing and reconciling such information directly to the underlying accounting 
and other records used to prepare the basic financial statements or to the basic financial statements 
themselves, and other additional procedures in accordance with auditing standards generally accepted 
in the United States of America.  In our opinion, the combining and individual nonmajor fund financial 
statements and schedules are fairly stated in all material respects in relation to the basic financial 
statements as a whole.   
The introductory and statistical sections have not been subjected to the auditing procedures applied in 
the audit of the basic financial statements, and, accordingly, we do not express an opinion or provide 
any assurance on them. 
 
 
 

3 
Other Reporting Required by Government Auditing Standards 
In accordance with Government Auditing Standards, we have also issued our report dated 
November 17, 2020 on our consideration of the Town of Waterford, Connecticut’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 solely to describe the 
scope of our testing of internal control over financial reporting and compliance and the results of that 
testing, and not to provide an opinion on the effectiveness of the Town of Waterford, Connecticut’s 
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 Town of Waterford, 
Connecticut’s internal control over financial reporting and compliance. 
West Hartford, Connecticut 
November 17, 2020 

4 
TOWN OF WATERFORD, CONNECTICUT 
MANAGEMENT’S DISCUSSION AND ANALYSIS 
JUNE 30, 2020 
This discussion and analysis of the Town of Waterford, Connecticut (the Town) financial performance is 
prepared by management to provide an overview of the Town’s financial activities for the fiscal year 
ended June 30, 2020.  Please read this MD&A in conjunction with the transmittal letter and the Town’s 
financial statements, Exhibits I to IX. 
FINANCIAL HIGHLIGHTS 

The Town’s net position decreased as a result of this year’s operations.  While net position of
our business-type activities decreased by $1.6 million, or 2.9 %, net position of our governmental
activities decreased by $894 thousand or 0.6 %.

During the year, the Town had expenses that were $894 thousand more than the $111.4 million
generated in tax and other revenues for governmental programs.

In the Town’s business-type activities, revenues and transfers in decreased by $120.0 thousand
or 3.0%, while expenses increased by $182.0 thousand or 3.5 %.

The total cost of all of the Town’s programs was $117.6 million, with no new programs added
this year.

The General Fund reported a fund balance this year of $20.1 million.

The resources available for appropriation were $1.5 million more than anticipated for the
General Fund.  There was an additional appropriation of $1.0 million to transfer unreserved fund
balance to the capital and Non-recurring fund.  However, unused appropriations of $1.8 million
were returned to fund balance at year end.  Overall, the operating results increased the General
Fund balance by $2.3 million
OVERVIEW OF THE FINANCIAL STATEMENTS 
This annual report consists of a series of financial statements.  The statement of net position and the 
statement of activities (Exhibits I and II, respectively) provide information about the activities of the Town 
as a whole and present a longer-term view of the Town’s finances.  Fund financial statements are 
presented in Exhibits III to IX.  For governmental activities, these statements tell how these services were 
financed in the short term as well as what remains for future spending.  Fund financial statements also 
report the Town’s operations in more detail than the government-wide statements by providing 
information about the Town’s most significant funds.  The remaining statements provide financial 
information about activities for which the Town acts solely as a trustee or agent for the benefit of those 
outside of the government. 
Government-Wide Financial Statements 
Our analysis of the Town as a whole begins on Exhibits I and II.  These statements include all assets and 
liabilities using the accrual basis of accounting, which is similar to the accounting used by most private-
sector companies.  All of the current year’s revenues and expenses are taken into account regardless of 
when cash is received or paid. 
These two statements report the Town’s net position and changes in it.  Over time, increases or 
decreases in the Town’s net position are one indicator of whether its financial health is improving or 
deteriorating.  The reader needs to consider other non-financial factors, however, such as changes in the 
Town’s property tax base and the condition of the Town’s capital assets, to assess the overall health of 
the Town. 

 
5 
In the statement of net position and the statement of activities, we divide the Town into two types of 
activities: 
 
 
Governmental Activities - Most of the Town’s basic services are reported here, including 
education, public safety, public works, recreation, library, social services and general 
administration.  Property taxes, charges for services, and state and federal grants finance most of 
these activities. 
 
 
Business-Type Activities - The Town charges a fee to customers to help it cover all or most of the 
cost of certain services it provides.  The Town’s Utility Commission Enterprise Fund is reported 
here.   
 
Fund Financial Statements 
 
The fund financial statements begin with Exhibit III and provide detailed information about the most 
significant funds - not the Town as a whole.  Some funds are required to be established by Charter.  
However, the Board of Finance establishes many other funds to help control and manage money for 
particular purposes or to show that it is meeting legal responsibilities for using grants and other money 
(i.e. grants received for education from the State and Federal Government).  The Town’s funds are 
divided into three categories: governmental, proprietary and fiduciary. 
 
 
Governmental Funds (Exhibits III and IV) - Most of the Town’s basic services are reported in 
governmental funds, which focus on how money flows into and out of those funds and the 
balances left at year-end that are available for spending.  These funds are reported using an 
accounting method called modified accrual accounting, which measures cash and all other 
financial assets that can readily be converted to cash.  The governmental fund statements 
provide a detailed short-term view of the Town’s general government operations and the basic 
services it provides.  Governmental fund information helps to determine whether there are more 
or fewer financial resources that can be spent in the near future to finance the Town’s programs.  
The relationship (or differences) between governmental activities (reported in the statement of net 
position and the statement of activities) and governmental funds is described in a reconciliation 
included with the fund financial statements. 
 
 
Proprietary Funds (Exhibits V to VII) - When the Town charges customers for the services it 
provides, whether to outside customers or to other units of the Town, these services are generally 
reported in proprietary funds.  Proprietary funds are reported in the same way that all activities 
are reported in the statement of net position and the statement of activities.  In fact, the Town’s 
enterprise fund (a component of proprietary funds) is the same as the business-type activities 
reported in the government-wide statements, but provide more detail and additional information, 
such as cash flows, for proprietary funds.  Internal service funds (the other component of 
proprietary funds) are used to report activities that provide supplies and services for the Town’s 
other programs and activities - such as the Town’s Insurance Administration Fund. 
 
 
Fiduciary Funds (Exhibits VIII and IX) - The Town is the trustee, or fiduciary, for its employees’ 
pension plans.  It is also responsible for other assets that, because of a trust arrangement, can be 
used only for the trust beneficiaries.  All of the Town’s fiduciary activities are reported in separate 
statements of fiduciary net position and changes in fiduciary net position.  These activities are 
excluded from the Town’s other financial statements because the Town cannot use these assets 
to finance its operations.  The Town is responsible for ensuring that the assets reported in these 
funds are used for their intended purposes. 
 

 
6 
 
GOVERNMENT-WIDE FINANCIAL ANALYSIS 
 
The Town’s combined net position decreased from $212.9 to $210.5 million or 1.2 %.  The analysis 
below focuses on the net position (Table 1) and changes in net position (Table 2) of the Town’s 
governmental and business-type activities. 
 
TABLE 1 
Governmental
Business-Type
Activities
Activities
Total
2020
2019
2020
2019
2020
2019
Current assets 
$
46,091
       
$
37,468
         
$
5,331
       
$
5,196
           
$
51,422
       
$
42,664
         
Capital assets, net of
 accumulated depreciation
243,891
     
244,054
       
47,418
     
49,212
         
291,309
     
293,266
       
Total assets
289,982
     
281,522
       
52,749
     
54,408
         
342,731
     
335,930
       
Deferred outflows of resources
17,947
       
20,183
         
-
              
-
                   
17,947
       
20,183
         
Long-term debt outstanding   
134,964
     
130,233
       
345
          
406
             
135,309
     
130,639
       
Other liabilities
8,251
         
8,561
           
378
          
429
             
8,629
         
8,990
           
Total liabilities
143,215
     
138,794
       
723
          
835
             
143,938
     
139,629
       
Deferred inflows of resources
6,296
         
3,599
           
-
              
-
                   
6,296
         
3,599
           
Net Position: 
Net investment in capital assets
177,425
     
172,217
       
47,417
     
49,212
         
224,842
     
221,429
       
   Restricted  
127
            
135
             
-
              
-
              
127
            
135
             
   Unrestricted
(19,134)
      
(13,040)
       
4,609
       
4,361
           
(14,525)
      
(8,679)
         
Total Net Position
$
158,418
     
$
159,312
       
$
52,026
     
$
53,573
         
$
210,444
     
$
212,885
       
Net position of the Town’s governmental activities decreased by 0.6 % ($158.5 million in 2020 compared 
to $159.3 million in 2019).  Unrestricted net position - the part of net position that can be used to finance 
day-to-day operations without constraints established by debt covenants, enabling legislation or other 
legal requirements – decreased by $6.1 million ($13.0) million in 2019 compared to ($19.1 million) at the 
end of this year. 
 
By far the largest portion of the Town’s net position is its investment in capital assets (e.g., land, 
buildings, machinery and equipment).  Since the Town’s investment in its capital assets, net of 
accumulated depreciation, must also be reported net of related debt, it should be noted that the Town’s 
outstanding debt is related to bonds payable as of June 30, 2020. 
 
The net position of our business-type activities decreased by 2.9 % ($52.0 million in 2020 compared to 
$53.6 million in 2019). 

 
7 
 
The Town’s total revenues (excluding special items) were $115.2 million.  The total cost of all programs 
and services was $117.6 million.  Our analysis below separately considers the operations of 
governmental and business-type activities. 
 
TABLE 2 
Governmental
Business-Type
Activities
Activities
Total
2020
2019
2020
2019
2020
2019
Revenues:
Program revenues:
Charges for services
$
3,091
       
$
3,613
       
$
3,710
       
$
3,765
       
$
6,801
       
$
7,378
       
Operating grants and contributions
13,901
     
6,171
       
13,901
     
6,171
       
Capital grants and contributions
658
          
839
          
658
          
839
          
General revenues:
Property taxes
92,136
90,251
92,136
     
90,251
     
Grants and contributions not  
 restricted to specific purposes
351
353
351
          
353
          
Unrestricted investment earnings
1,082
1,297
47
            
70
            
1,129
       
1,367
       
Miscellaneous revenue
197
39
197
          
39
            
      Total revenues
111,416
   
102,563
   
3,757
       
3,835
       
115,173
   
106,398
   
Program expenses:
General government  
15,856
     
15,427
     
15,856
     
15,427
     
Public safety  
13,150
     
13,198
     
13,150
     
13,198
     
Public works
8,086
       
8,432
       
8,086
       
8,432
       
Recreation
1,941
       
1,773
       
1,941
       
1,773
       
Library
1,159
       
1,154
       
1,159
       
1,154
       
Social services
1,427
       
1,370
       
1,427
       
1,370
       
Education
68,539
     
60,142
     
68,539
     
60,142
     
Interest and fiscal charges
2,057
       
2,285
       
2,057
       
2,285
       
Utility Commission
5,399
       
5,217
       
5,399
       
5,217
       
      Total program expenses
112,215
   
103,781
   
5,399
       
5,217
       
117,614
   
108,998
   
Excess (deficiency) of revenues over expenses
before transfers
(799)
         
(1,218)
      
(1,642)
      
(1,382)
      
(2,441)
      
(2,600)
      
Transfers
(95)
           
(138)
         
95
            
138
          
-
               
-
               
Change in Net Position 
(894)
         
(1,356)
      
(1,547)
      
(1,244)
      
(2,441)
      
(2,600)
      
Beginning Net Position  
159,312
   
160,668
   
53,573
     
54,817
     
212,885
   
215,485
   
Ending Net Position
$
158,418
  
$
159,312
 
$
52,026
   
$
53,573
   
$
210,444
   
$
212,885
 
Governmental Activities 
 
Approximately 82.7% of these revenues were derived from property taxes, followed by 13.4% from 
operating and capital grants and contributions, 2.8% from charges for services and 1.1% from investment 
and other general revenues. 
 
 
Major factors affecting operations include: 
 
Operating grants and contributions were up by $7.70 million due primarily to the increase in the 
State’s on-behalf contribution for the Teachers’ Retirement System ($3.5 million) and the 
Teachers’ Retirement System OPEB ($3.9 million)  
 
Property tax revenues were up by $1.9 million due to an increase in the mill rate of 2.4% 
 
Capital grants and contributions decreased by $181 thousand, due to the mainly following: 
 
     LOCIP grant for HVAC was down by $392.1 thousand 
 
     LOCIP grant for Pepperbox Lane was up by $185.6 thousand 

 
8 
 
     Local Bridge grant was down by $128.3 thousand 
 
     Town Aid Road was down by $1.2 thousand 
 
     Recreation capital grants were up by $20 thousand 
 
     Electrical rebates were received for HVAC project ($13.6 thousand) and the Street Light 
     Project ($120.8 thousand) 
 
Charges for services were down by $522 thousand due to many programs being canceled due to 
Covid-19 
 
Investment earnings were down by $215.0 thousand from FY19. 
 
Table 3 presents the cost of each of the Town’s five largest programs - education, general government, 
public safety, public works and recreation - as well as each program’s net cost (total cost less revenues 
generated by the activities).  The net cost shows the financial burden to the Town’s taxpayers by each of 
these functions. 
 
TABLE 3 
Total Cost of Services
Net Cost of Services
2020
2019
2020
2019
Education  
$
68,539
   
$
60,142
   
$
54,670
     
$
53,683
   
General government
15,856
   
15,429
   
14,679
     
13,828
   
Public safety   
13,150
   
13,198
   
12,308
     
12,446
   
Public works  
8,086
     
8,432
     
6,850
       
7,250
     
Recreation
1,941
     
1,773
     
1,738
       
1,541
     
All others
4,643
     
4,809
     
4,320
       
4,412
     
Totals
$
112,215
 
$
103,783
 
$
94,565
     
$
93,160
   
 
Business-Type Activities 
 
Net position of the Town’s business-type activities (see Table 2) decreased by 2.9% ($52.0 million in 
2020 compared to $ 53.6 million in 2019).  Revenues and transfers in for the Town’s business-type 
activities (see Table 2) decreased by $120.0 thousand ($3.9 million in 2020 compared to $4.0 million in 
2019).  The factors driving these results include:  
 
 
A decrease in Sewer use fee revenue of $55 thousand. 
 
A decrease in capital contributions of $43 thousand  
 
A decrease of investment earnings of $23 thousand. 
 
An increase in expenses of $182.0 thousand. 
 
TOWN FUNDS FINANCIAL ANALYSIS 
 
Governmental Funds 
 
As the Town completed the year, its governmental funds (as presented in the balance sheet - Exhibit III) 
reported a combined fund balance of $31.2 million, which is increase of $7.5 million from last year’s total 
of $23.7 million.  Included in this year’s total change in fund balance is an increase of $2.8 million in the 
General Fund, an increase of $3.6 million in the Capital and Nonrecurring Fund and an increase of $1.1 
million for Nonmajor Governmental Funds. 
 
 

 
9 
 
Capital Projects Funds: 
 
o The Capital and Nonrecurring Fund balance increased by $3.6 million due to expenditures of 
$10.0 million being offset by revenues of $439.8 thousand and other financing sources or $13.2 
million.  Included in other financing sources were transfers in of $3.1 million, bond anticipation note 
proceeds of $10 million and a premium on the note of $93.5 thousand. 
 
Non-Major Capital Projects Funds: 
 
 
The Fleet Management Fund increased by $650.5 thousand due to expenditures of $627.6 
thousand being offset by revenues and transfers in of $1.3 million. 
 
The Capital Improvement Fund increased by $416.9 thousand due to expenditures of $766.7 
thousand being offset by net transfers in and out $1.2 million. 
 
The Animal Control Facility fund decreased by $186.8 thousand due to expenditures of the same 
amount. 
 
The Sewer Development and Maintenance Fund increased by $93.5 thousand due to expenditures 
of $20.8 thousand being offset by revenues of $114.4 thousand. 
 
Special Revenue Funds: 
 
 
The Small Cities Grant Fund increased by $45.9 thousand due to loan repayments of the same 
amount. 
 
The Youth and Family Services special revenue fund increased by $30.9 thousand due to 
expenditures of $169.5 thousand and total revenues of $200.4 thousand. 
 
The Drug Enforcement fund increased by $10.9 thousand due to expenditures of $7.9 thousand 
and total revenues of $18.8 thousand. 
 
Proprietary Funds 
 
The Town’s Proprietary Funds provide the same type of information found in the government-wide 
financial statements, but in more detail. 
 
Overall, proprietary funds net assets total $57.8 million at the end of the year, which includes a $5.8 
million fund balance in the Internal Service Fund.     
 
Net position of the Utility Commission Fund at the end of the year amounted to $52.0 million.  Factors 
affecting the balance of this fund are included in the discussion of the Town’s business-type activities. 
 
In fiscal year 2020, net position of the Internal Service fund increased by $1.3 million from fiscal year 
2019.  This is due to $11.4 million in contributions and other revenues (a decrease of $215.9 thousand 
over fiscal year 2019), offset by expenses for claims and program administration of $10.2 million (a 
decrease of $1.8 million over fiscal year 2019). 
 
General Fund Budgetary Highlights 
 
Revenues were higher than budgetary estimates by $1.5 million and expenditures were less than original 
budgetary estimates by $780 thousand.  Overall revenues over expenditures on a budgetary basis were 
$2.3 million.  In the current year, revenues increased by $891.0 thousand or 1.0 % over the prior year 
and expenditures increased by $1.5 million or 1.6%.   
 
 
 

 
10 
 
The major factors affecting this year’s annual operating results are as follows: 
 
 
Property tax revenue was under budgetary estimates by $145.8 thousand and over prior year 
revenue by $998.4 thousand. 
 
State grant funding was over budgetary estimates by $370.0 thousand and under prior year 
revenue by $20.5 thousand. 
 
Assessment revenue is over budgetary estimates by $14.3 thousand and under the prior year by 
$12.9 thousand. 
 
License and Permit revenue is over budgetary estimates by $79.9 thousand and under the prior 
year by $113.3 thousand.  Town clerk fees increased by $25 thousand over FY19.  The building 
department is down from FY19 by $43.0 thousand, followed by conveyance tax revenue, which is 
down from FY19 by $20.9 thousand.  Planning & zoning had a decrease of $17.7 thousand over 
the prior year. 
 
Fines, Penalties and Charges for Services are over budgetary estimates by $7.0 thousand and 
under the prior year revenue by $40.3 thousand.  The biggest change was an increase for tuition 
fees of $60.3 thousand, followed by a decrease of $51.2 thousand in tipping fee revenue.  
Recycling revenue decreased by $21.0 thousand.  Senior Services program revenue was down by 
7.3 thousand and the library was down by $5.5 thousand. 
 
Other sources of revenue were over budgetary estimates by $153.6 thousand and over the prior 
year revenue by $24.3 thousand.   
 
Investment income is over budgetary estimates by $572.6 thousand but under prior year revenue 
by $176.0 thousand. 
 
Other Financing Sources, which consists of the cancelation of prior year encumbrances and 
transfers in from the capital improvement fund, was over estimated revenue by $398.2 thousand 
and over the prior year by $231.3 thousand. 
 
Overall Expenditures came in $1.8 million under budgetary estimates.  The largest amounts of unused 
appropriations returned in the current fiscal year are outlined below: 
 
 
The Board of Education would have returned $664.9 thousand, however, one half of this was 
subsequently assigned to a non-lapsing account for their future use.  The amount returned to the 
general fund balance was $332.4 thousand. 
 
The Retirement budget returned $383.1 thousand. 
 
The Public Works Department returned $331.3 thousand. 
 
The Planning & Zoning Department returned $88.2 thousand. 
 
The Recreation and Parks Department returned $81.0 thousand. 
 
The Debt Service budget returned $65.9 thousand. 
 
The Library budget returned $55.5 thousand. 
 
The Information Technology Department returned $53.3 thousand. 
 
The Town’s General Fund balance of $20.1 million reported on Exhibit III differs from the General Fund’s 
budgetary balance of $19.2 million reported in the budgetary comparison in the required supplementary 
information.  This is principally because budgetary fund balance does not include $522.1 thousand of 
outstanding encumbrances at year-end, which are reported as expenditures for budgetary purposes.  
The balances for special revenue funds that are funded primarily from operating transfers from the 
General Fund are also rolled into that fund for reporting purposes.  For fiscal year 2020, those balances 
amounted to $355.5 thousand. 
 
 
 
 
 

 
11 
 
 
CAPITAL ASSET AND DEBT ADMINISTRATION 
 
Capital Assets 
 
At June 30, 2020, the Town had $291.3 million invested in a broad range of capital assets, including 
land, buildings, park facilities, vehicles and equipment, roads, bridges, and water and sewer lines -  
Table 4.  This amount represents a net decrease (including additions and deductions) of $2.0 million, or 
0.7%, from last year. 
 
TABLE 4 
Governmental
Business-Type
Activities
Activities
Total
2020
2019
2020
2019
2020
2019
Land
$
8,957
        
$
8,956
         
$
128
           
$
129
            
$
9,085
        
$
9,085
         
Land improvements
1,543
        
528
            
1,543
        
528
            
Building and improvements
160,281
    
166,112
     
978
           
1,013
         
161,259
    
167,125
     
Machinery and equipment
2,970
        
3,865
         
668
           
707
            
3,638
        
4,572
         
Vehicles
5,823
        
6,419
         
227
           
205
            
6,050
        
6,624
         
Infrastructure
54,912
      
55,538
       
45,409
      
47,149
       
100,321
    
102,687
     
Permanent easements
5
               
5
                
5
               
5
                
Software
94
             
107
            
8
               
9
                
102
           
116
            
Construction in progress
9,306
        
2,524
         
9,306
        
2,524
         
Total 
$
243,891
    
$
244,054
     
$
47,418
      
$
49,212
       
$
291,309
    
$
293,266
     
Major capital asset events during the current fiscal year are noted below: 
 
Governmental Activities: 
 
 
Construction-in-progress increased by $6.8 million due mainly to the ongoing costs associated with 
the public works complex renovation project of $7.2 million, offset by a decrease of $719.4 
thousand for the completion of the street light project.  Other additions came to $320.6 thousand. 
 
 
Buildings and improvements decreased by $5.8 million.  Decreases are due to the razing of the 
municipal complex buildings (net decrease of $200.5 thousand) and depreciation expense of $5.6 
million. 
 
 
Land improvements increased by $1.0 million due to the addition of the Girls’ Softball field at the 
High School ($1.0 million).  There were also additions to the playground at Civic Triangle ($49.7 
thousand) and the replacement of the dog park fencing ($12.7 thousand).  Land improvements 
were also reduced by depreciation expense of $66.8 thousand. 
 
 
Infrastructure decreased by $626 thousand due mainly due to depreciation expense of $1.7 million.  
Additions included the completion of the streetlight project ($1.0 million), various road projects 
$55.6 thousand, and a sidewalk addition at civic triangle $14.9 thousand. 
 
 
Machinery and equipment decreased by $895.0 thousand due to mainly to depreciation expense of 
$961.5 thousand, which was offset by additions of $65.9 thousand. 
 
 
Vehicles decreased by $595.0 thousand due to additions of $444.8 thousand, in accordance with 
the fleet management plan,