2018 Town Financials FINANCIAL REPORT
Audited
TOWN OF WAPPINGER,NEW YORK
For the Year Ended December 31, 2017
Audited for:
The Supervisor and
Members of the Town.Board
Town of Wappinger,New York
Audited by:
RBT CPAs,LLP
I I Racquet Road
Newburgh,NY 12550
(845) 567-9000
TOWN OF WAPPINGER,NEW YORK
TABLE OF CONTENTS
Page
Independent Auditor's Report...................................................................................................................... ....1-2
Management's Discussion and Analysis(unaudited)............................................................................................3-8
BASIC FINANCIAL STATEMENTS:
Government-Wide Financial Statements:
Statementof Net Position.,....... ................................. .................................................. 9
Statementof Activities.,............. ...... ...................................................... ....... ............................. ....... 10
Fund Financial Statements:
Balance Sheet—Governmental Funds............................ ..................... .................................. 11
Reconciliation of the Total Governmental Funds Balance Sheet to the Statement of Net Position............ 12
Statement of Revenues,.Expenditures and Changes in Fund Balances—Governmental Funds.................. 13
Reconciliation of the Statement of Revenues,Expenditures and
Changes in Fund Balance of Governmental Funds to the Statement of Activities...................._............... 14
Statement of Net Position—Fiduciary Funds.............................................................................................. 15
Notes to the Financial Statements..................................................................................................................16-41
REQUIRED SUPPLEMENTARY INFORMATION:
Budgetary Comparison Schedule—General Fund—Townwide,General Fund—Part-Town,
Highway Fund,Water Fund and Sewer Fund................. ..........42-46
Schedule of Funding Progress-Other Postemployment Benefits........................................__...................47
Schedule of the Proportionate Share Of the Net Pension Liability.............................................................48
Schedule of Employer Contributions..........................................................................................................49
OTHER SUPPLEMENTARY INFORMATION:
Combining Balance Sheet—Non-Major Governmental Funds...................................................................50
Combining Schedule of Revenues,Expenditures and Changes in Fund Balances—
Non-Major Governmental Funds................................................................................................................51
Independent Auditor's Report on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance With Government Auditing Standards................................................................52-53
Schedule of Findings,Recommendations and Responses .....................................................................54-58
Table of Contents
I,
JJ T
LIMITED LIABILITY PARTNERSHIP
CERTIP19D PUBLIC ACCOUNTANTS BUSINESS DEVELOPMENT CONSULTANTS
INDEPENDENT AUDITOR'S REPORT
To the Supervisor and
Members of the Town Board
Town of Wappinger,New York
20 Middlebush.Road
Wappingers Falls,New York 12590
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the
aggregate remaining fund information of the Town of Wappinger,New York,as of and for the year ended December
31,2017,and the related notes to the financial statements,which collectively comprise the Town of Wappinger,New
York'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.
Auditor's 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 auditor's judgment, including the assessment of the risks of
material misstatement of the financial statements,whether due to fraud or error.In making those risk assessments,the
auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the circumstances,but not for the purpose of expressing an
opinion on the effectiveness of the entity's internal control.Accordingly,we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management,as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
rbtcpas.cdr�
11 Racquet{toad 2678 South Roark,Suite 101 P.A box 20'9
Nexbvr9h,NY 12550 Paughkeepaie,:NY 12601 51 So.11lvarrt Sireet
T�,(645)$87-9000 T (645)4 8'410 wortaborc,MY 12790
Fa C6d55 5674226 Fi(A 45)465-5547 T;(645)666-5656
F:(645)1368-2769
1
Opinions
In our opinion,the financial statements referred to above present fairly,in all material respects,the respective financial
position of the governmental activities, each major fund, and the aggregate remaining fund information of the Town
of Wappinger,New York,as of December 31,2017,and the respective changes in financial position 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, budgetary comparison information, schedule of funding progress - other postemployment benefits,
schedule of the proportionate share of the net pension liability, and schedule of employer contributions, 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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the Town of Wappinger, New York's basic financial statements. The combining non-major fund schedules are
presented for purposes of additional analysis and are not a required part of the basic financial statements,
The combining non-major fund 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 non-major fund schedules are fairly stated in all material respects in relation to the basic
financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 4, 2018 on our
consideration of the Town of Wappinger,New York'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 Town of Wappinger,New York's internal control over financial reporting and compliance.
RBT CTAS, LLP
Newburgh,NY
October 4,2018
2
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS
1.Overview of the Financial Statements
These Audited Financial Statements consist of five parts. The Independent Auditor's Report on our Financial
Statements, Management's Discussion and Analysis (this section), Government Wide Financial Statements, Fund
Financial Statements and Notes to the Financial Statements.
-Government-Wide Financial Statements provide both long term and short term information about the Town's overall
financial status. They report information about the Town as a whole using accounting methods similar to private
sector companies.
-Fund Financial Statements focus on the individual parts of Town government, reporting the Town's operations in
more detail than the Government—Wide Financial Statements. They focus on the most significant or"major"funds-
not the Town as a whole. See Note A in the notes to the financial statements for information regarding individual
types of funds.
-Notes to the Financial Statements provide further explanation and support for the information contained in the
Financial Statements,
2. Financial Analysis of the Town as a whole
SUMMARY OF STATEMENT OF NET POSITION
Assets 2017 2016 Change
Non-Capital $ 17,350,628 $16,336,474 $ 1,014,154
Capital 64,654,858 65,336,444 681,586
Total Assets 82,005,486 81,672,918 332,568
Deferred Outflows of Resources 2,093,477 2,825,619 (732,142)
Total Assets and Deferred Outflows of Resources $ 84,098,963 $84,498,537 $ 399,574
Liabilities
Current $ 3,846,968 $ 6,242,776 $ (2,395,808)
Non-Current 24,773,861 25.313,313 (539,452)
Total Liabilities 28,620,829 31,556,089 (2,935,260)
Deferred Inflows of Resources 1,259,449 1,390,990 (131,541)
Total Liabilities and Deferred Inflows of Resources 29,880,278 32,947,079 x,066,801)
Net Position
Capital 44,443,740 44,449,985 (6,245)
Restricted 2,479,528 2,439,947 39,581
Unrestricted 7,295,417 4,661,526 2,633,891
Total Net Position 54,218,685 51,551,458 2,667,227
Total Liabilities and Net Position $ 84,098,963 $84,498,537 $ (399,574)
3
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYS[S
2.Financial Analysis of the Town as a whole(Continued)
SUMMARY OF STATEMENT OF ACTIVITIES
Revenues 2017 2016 Change
Program
Charges for Services $ 4,413,651 $ 4,821,111 $ (407,460)
Operating Gants 6,399 137,827 (131,428)
Capital Gants 41.7,773 905,089 (487,316)
General Revenues
Property Taxes 8,109,192 8,199,157 (89,965)
Other Taxes 2,472,220 2,505,174 (32,954)
Investment Earnings 313,479 278,769 34,710
Other Gants and Contributions 274,040 268,730 5,310
Other Revenues 215,185 190,776 24,409
Total Revenues 16,221,939 17,306,633 (1,084,694)
Expenses
General Government Support 2,292,343 3,122,576 (830,233)
Public Safety 472,677 709,670 (236,993)
Health 416,591 345,387 71,204
Transportation 3,421,445 3,773,607 (352,162)
Economic Assistance 4,197 6,516 (2,319)
Culture and Recreation 869,722 1,144,771 (275,(A9)
Home and Community Service 5,226,102 5,994,487 (768,385)
Interest on Long Tenn Debt 851,635 645,715 205,920
Total Expenses 13,554,712 15,742,729 (2,188,017)
Change in Net Position 2,667,227 1,563,904 1,103,323
Net Position-beginning 51,551,458 49,832,152 1,719,306
Prior Period Adjustment - 155,402 (155,402)
Net Position-beginning,restated 51,551,458 49.987,554 1,563,904
Net Position-ending $ 54,218,685 $ 51,551,458 $ 2,667,227
Governmental Funds:
GENERAL FUND
The General Fund consists of the General Town-Wide Fund and the General Part-Town Fund.The General Town-
Wide includes activities of the Parklands Trust Fund, Friends of Camwath and the 9-11 Memorial Fund, The
General Fund is the chief operating fund of the Town.At the end of the year,the total fund balance of the General
Town-Wide Fund was $2,133,003, a decrease of$1,326,156 from the prior year. $76,922 of the total General
Town-Wide Fund balance is in non-spendable form(made up of prepaid expenses).
4
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
.MANAGEMENT'S DISCUSSION AND ANALYSIS
2. Financial Analysis of the Town as a whole(Continued)
GENERAL FUND(CONTINUED)
The remaining $2,056,081 is in spendable form as follows: $108,800 is restricted for debt service payment,
$700,325 is restricted for recreation,$58,008 is appropriated for 2018 expenditures and the remaining$1,118,948
represents spendable,unassigned fund balance.The total fund balance in the General Part-Town.Fund at the end
of the year was $4,307,420,an increase of$1,022,672 from the prior year. The surplus in the general fund was
mainly due to better than expected revenue from sales tax, franchise fee, building permits,planning board fee,
fines&fees from the Justice Court,and mortgage tax.
The following charts describe significant categories of General Fund revenues and expenses:
Combined General Fund Revenues 2017
;Property Taxes&Tax Items
ltl 4�I19�� it�f�i ' AState&Federal Aid
Wales and Franchlse Tax
3% ■Use of Money&Property
4% Moepartmental Income
MFlnes,Licenses and Permits
1%
MAI I Other
Combined General Fund Expenditures 2017
MiGeneral Government Support
■Public safety
MiTransportation
MCultureand Recreation
"Home and Community Services
I 5%
I Employee Benefits
3% UDebt service
5% VA0I Other
5
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS
2.Financial Analysis of the Town as a whole(Continued)
HIGHWAY FUND
The Highway Fund ended the year with $1,819,920 in Fund Balance, of which $235,699 is non-spendable,
$28,077 is restricted for debt service payment and$1,556,144 is assigned for highway activities.
The following charts describe the significant categories of Highway Fund revenues and expenses:
Highway Fund Revenues 2017
0%
■Property Taxes
■sales Tax
NState&Federal Aid
10ther Revenue
Highway Fund Expenditures 2017
_ VStreet Maintenance
UPermanentRoad Improvements
(Snow Removal
EGeneral Government Support
MMachinery Purchase and
Maintenance
®Employee Benefits
MDebt Service
3%
WATER FUNDS
The Town operated four water districts during 2017 with an overall Fund Balance of$2,326,01.8. Operating
revenues totaled$2,215,346 with operating expenditures and interfund transfers totaling$2,189,206 resulting in
an excess of revenues over expenditures in the amount of$26,140.The excess is the result of strong and prudent
budgeting practices.
6
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS
2.Financial Analysis of the Town as a whole(Continued)
SEWER AND DRAINAGE FUNDS
The Town operated fourteen sewer and drainage districts during 2017,. with an overall fund balance of$2,322,607,
the main sewer district being the United Wappinger Sewer District,with a fund balance of$1,320,300.Operating
revenues and transfers in for the combined sewer and drainage districts totaled $3,003,338 with operating
expenditures and transfers out totaling $3,212,923 resulting in an excess of expenditures over revenues in the
amount of$209,585.
BUDGETARY HIGHLIGHTS
The Town.Budget is adopted in November each year for the following year and is modified throughout the year
as necessary.Variances in budgetary revenues and expenditures have been explained in the paragraphs above.
3.Activities Regarding Capital Assets,Long and Short Term Debt
The Town spent approximately$1.6 million on capital projects in 2017. The main projects were:resurfacing of
various town roads, the emergency services building renovation, United Wappinger District water meter
replacement,Town hall windows replacement and the Tri-Municipal sewer system repairs.
LONG TERM DEBT
S&P Global Ratings assigned the Town a credit rating of"AA+"in October,2018.This rating reflects the town's
strong financial position consistent with robust budgetary controls, The rating allows the Town to compete for
better interest rates for future debt issues.
Total long term serial bond debt at the end of 2017 was$22,525,000. Of this debt,$2,742,698 is attributable to
the General Funds,$4,476,326 to the Highway Fund,$4,591,298 to the sewer districts fund,and $1.0,714,678 to
the water districts fund. Water and sewer serial bonds debt is paid for by the property owners in the respective
water and sewer districts.
In March 2017,the town issued a $3,370,000 Serial Bond converted from a Bond Anticipation Notes (BAN).
This serial bond is made up of$562,000 for Wappinger Creek pump station and $563,000 for Aeration System
Replacement, both projects of Tri-Municipal Sewer Commission, $1,775,000 for Water Meter Replacement, a
project of United Wappinger water district, and $470,000 to purchase heavy duty trucks and tractors for the
Highway Department.On June 10,2018 the Town issued a$860,000 Serial Bonds Series"A"made of$600,000
for the reconstruction of various town roads and $260,000 for the improvement of the Midpoint sewer district.
The said bond was issued following maturity of a Bond Anticipation Note of$930,000.On October 23,2018,the
Town issued 2018 Serial Bonds Series`B"worth$2,525,000 made up of$300,000 for the extension of Tall Trees
water district to the United Wappinger Water District,$625,000 for Highway Equipment,and$1,600,000 for the
reconstruction of various town roads in 2018. and 2019.. The Town is set to issue $1,755,000 Serial Bonds in
December 2018 to reimburse the general fund for funds used to renovate the Emergency Services Building which
houses the NYS Troopers and the EMSTAR ambulance Services.
4.Currently Known Facts Bearing on the Future
The Town continues to have a shared service agreement with the Town of Fishkill for a Joint Assessor. This
program known as the Coordinated Assessment Program or CAP continues to deliver cost savings to the Town.
The assessment roll established in 2017 for 2018 taxes resulted in homestead assessments increasing by an
average of 1.33%. However, there was a small change in the proportion of non-homestead to homestead
assessments.Non-homestead assessments for 2018 were 42%of the total and homestead assessments were 58%.
The Town adopted a reduced overall tax levy increase of 0.98%in 2018 down from 0.13%in 2017.
7
TOWN OF WAPPINGER,NEW YORK
REQUIRED SUPPLEMENTARY INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS
4.Currently Known facts Bearing on the Future(Continued)
The Town signed a Memorandum of Agreement(M:4A)with CSEA for the Town's highway employees covering
the period January 1,2016 through December 31,2017.The town also secured a collective bargaining agreement
with the Teamsters Union for non-highway Town employees covering the period 2014 through 2017.The Town
Board ratified the adoption of a new agreement with the Teamster Union that covers the period January 1,2018
through December 31,2019.The Town has begun negotiations with the CSEA for highway employees.
Capital improvement work at the Emergency Services Building located at 18 Middlebush Road commenced in
the fall of 2017 and includes roof replacement, generator and electrical improvements,heating,ventilating and
air conditioning (HVAC) replacement, and plumbing repairs, upgrades and improvements, The project is
expected to cost approximately $2.4million, to be financed by $1,755m in Serial Bonds, $500,000 in General
Town-wide fund balance and$145,000 from Dutchess County Shared Services grant.
In 2018 the Town authorized the paving of 7.2 miles of town roads,the most miles of paving in a couple of years,
The Town has entered into inter Inter-Municipal Agreements with the Town of Fishkill,Village of Fishkill,Town
of East Fishkill, City of Beacon, Town of Poughkeepsie and Village of Wappingers Falls to spearhead water,
sewer and economic development needs for the mutual benefit of the residents of these communities.
The Town is working with the Town of East Fishkill,City of Beacon and Village of Wappingers Falls,on various
projects including joint grant applications, proposals and funding to finance the consolidation of the Wildwood
Sewer District into the United Wappinger SewerDistrict,the connection of Wildwood Sewer and Woodhill Green
Sewer to the Tri-Municipal Sewer plant,water connections with the Village of Wappingers Falls for Wildwood
Water District and Woodhill Green and taking the water main south along Rte.9 into Fishkill and exploring ways
to bring water and sewer services to Town residents along Chelsea Road.
In September 2018, the Town Board adopted an amended code of ethics, local law No, 9 of 2018, to set the
standards of conduct for officers and employees of the municipality with respect to disclosure of interests in
legislation before the local governing body, holding of investments in conflict with official duties, private
employment in conflict with official duties, future employment, and such other standards as may be deemed
advisable.
8
TOWN OF WAPPINGER,NEW YORK
STATEMENT OF NET POSITION
DECEMBER 31,2017
GO V ERNMINTAL
ACTIVITIES
ASS UFS
Current assets:
Cash and cash equivalents $ 12,770,654
Cash and cash equivalents -restricted 1.,973,728
Receivables(net) 2,349,821
Inventories 82,748
Prepaid expenses 173,677
"Total current assets 17,350,628
Capital assets:
land 8,162,217
Improvements and infrastructure,net ofdepreciation 41,576,341
Buildings,machinery and equipment,net ofdepreciation 5,641,780
Construction in progress 9,274,520
Total capital assets (Note D) 64,654,858
Total assets 82,005,486
Deferred outflows ofresources(Note N) 2,093,477
Total assets and defe rred outflows ofresources $ 84,098,963
LILA81I11THN
Current Liabilities:
Accounts payable $ 306,618
Accrued liabilities 247,059
Bond anticipation notes payable(Note G) 930,000
Deferred revenue 163,747
Due to customers 23,397
Due to other governments 63,507
Current portion oflong-termliabilities:
Landfill remediation liability (Note H) 7,640
Bonds payable-Capital(Note H) 1385,538
Bonds payable-Non-capital(Note H) 719,462
Total current liabilities 3,846968
Non-current liabilities:
Judgment and claims(Note H) 80,OW
Compensated absence liabilities (Note H) 279,852
Other postemployment benefits liability (Note F) 3,035,296
Landfill remediation liability(Note H) 133,802
Bonds payable-Capital(Note H) 17,895,580
Bonds payable -Non-capital(Note H) 2,524,420
Net employee retirement system liability (Note E) 824,911
Total non-current liabilities 24,773,861
Total liabilities 28,620,829
Deferred inflows of resources(Note N) 1,259,449
Total liabilities and defe rred i nfl ows ofresources 29,880,278
NET POSITION
Net investment in capital assets 44,443,740
Restricted for debt service 870,503
Restricted for miscellaneous 402,900
Restricted for capital expenditures 505,800
Restricted for recreation 700,325
Unrestricted 7,295,417
Total net position 54,218,685
Total liabilities,deferred inflows ofresources,and net position $ 84,098,963
See Notes to Financial Statements
9
TOWN OF WAPPINGER,NEW YORK
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31,2017
NET(EXPENSE)
REVENUE AND
CHANGES IN
NET POSITION
CHARGES OPERATING CAPITAL
FOR GRANTS AND GRANTS AND GOVERNMENTAL
FUNCTIONS/PROGRA-NIS EXPENSES SERVICES CONTRIBL41ONS CONTRIBUIRONS ACTIVrM
Governmental Activities:
General govemmentsupport $ 2,292,343 $ 17,477 $ 6,399 $ $ (2,268,467)
Public safety 472,677 838,498 - 365,821
Health 416,591 7,146 - - (409,445)
Transportation 3,421,445 5,700 - 281,357 (3,134,388)
Economic assistance&opportunity 4,197 - - - (4,)97)
Culture and recreation 869,722 75,238 - - (794,484)
Homeandcommunity services 5,226,102 3,469,592 - 136,416 (1,620,094)
Interest on long-term debt 851,635 - - - (851,635)
Total gownmental activities $ 13,554,712 $ 4,413,651 $ 6,399 $ 417,773 (8,716,889)
General revenues
Taxes:
Real property taxes 8,109,192
Real property tax items 119,406
Sales taxdistribution 1,354,373
Mortgage taxdistdbution 517,870
Franchise taxes 480,571
Earning on investments 313,479
Grants and contributions not restricted to specific programs 274,040
Special item-Crain on sale of property and compensation for loss 27,212
Refund of prior year's expenditures 20,780
Miscellaneous 167,193
Total general revenues,special items and transfers 11,384,116
Change in net position 2,667,227
Net position-beginning 51,551,458
Net position-ending $ 54,218,685
See Notes to Financial Statements
10
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TOWN OF WAPPINGER,NEW YORK
RECONCILIATION OF THE TOTAL GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION
DECEMBER 31,2017
Total Long-Term Reclassifications Statement
Governmental Assets and and of Net
Funds Liabilities Eliminations Position
ASSETS
Cash and cash equivalents $ 12,770,654 $ - $ - $ 12,770,654
Cash and cash equivalents -restricted 1,973,728 - - 1,973,728
Receivables:
Charges for services 1,004,267 - 1,004,267
Other 251,417 - - 251,417
Due from other funds (Note C) 2,903,842 - (2,903,842) -
Due fromothergovernments 981,886 - - 981,886
State and federal aid receivable 112,251 - - 112,251
Inventory,at cost 82,748 - - 82,748
Prepaid expenses 271,546 (97,869) - 173,677
Capital assets - 64,654,858 - 64,654,858
Deferred outflows of resources - 2,093,477 - 2,093.477
Total as sets and deferred outflows of resources $ 20,352,339 $ 66,650,466 $ (2,903,842) $ 84,098,963
LIABILITIES
Accounts payable $ 306,618 $ - $ $ 306,618
Accrued liabilities 42,581 204,478 - 247,059
Due to customers 23,397 - - 23,397
Bond anticipation notes payable 930,000 - - 930,000
Due to other funds(Note C) 2,903,842 - (2,903,842) -
Due to other governments 63,507 - - 63,507
Deferred revenues 163,747 - - 163,747
Judgment and claims (Note H) - 80,000 - 80,000
Compensated absence liabilities (Note II) - 279,852 - 279,852
Other postemployment benefits liability(Note F) - 3,035,296 - 3,035,296
Landfill remediation liability(Note H) - 141,442 - 141,442
Bonds payable-Capital(Note H) - 19,281,118 - 19,281,118
Bonds payable -Non-capital(Note H) - 3,243,882 3,243,882
Net employee retirement system liability (Note E) - 824,911 - 824,911
Deferred inflows of resources (Note N) - 1,259,449 1,259,449
Total liabilities and deferred inflows of resources 4,433,692 28,350,428 (2,903,842) 29,880,278
Total fund balances 15,918,647 38,300,038 54,218,685
Total liabilities,deferred inflows of resources,
and fund balances $ 20,352,339 $ 66,650,466 $ (2,903,842) $ 84,098,963
See Notes to Financial Statements
12
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TOWN OF WAPPINGER,NEW YORK
RECONCILIATION OF THE STATEMENT OF REVENUES,EXPENDITURES AND CHANCES IN FUND
BALANCES OF GOVERNMENTAL FUNDS TO THE,STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31,2017
Total Long-Term Capital Long-Term Reclassifications Statement
Governmental Revenue and Related Debt and of
Funds Expenses Items Transactions Eliminations Activities
REVENUES
Real property taxes $ 8,109,192 $ - $ - $ - $ - $ 8,109,192
Real property taxitcros 119,406 - - - - 119,406
Non property taxitems 1,834,944 - - - - 1,834,944
Departmental income 3,601,978 - - 92,106 - 3,694,084
Use of money and property 313,479 - - - - 313,479
Licenses and permits 393,492 - - - - 393,492
Fines and forfeitures 418,181 - - - - 418,181
Sale of property and
compensation for loss 27,212 - - - - 27,212
Miscellaneous local sources 238,662 3,150 - 761 - 242,573
State aid 1,069,376 - - - - 1,069,376
Total revenues 16,125,922 3,150 - 92,867 - 16,221,939
EXPENDTIT RES/EXPENSES
General government support 3,035,449 (327,776) (700,518) - 285,188 2,292,343
Public safety 338,105 ((A),000) 72,875 - 151,697 472,677
health 414,020 (3,791) - - 6,362 416,591
Transportation 2,837,215 (372,180) (588) - 956,998 3,421,445
Economic assistance&opportunity 4,197 - - - - 4,197
Culture and recreation 700,159 (137,293) 77,632 - 229,224 869,722
Home and community services 4,160,521 (264,523) 1,232,185 - 97,919 5,226,102
Employee benefits 1,727,388 - - - (1,727,388) -
Debt service 2765,051 - - (1,913,416) - 851,635-
Total expenditures/expenses 15.982,105 (1.195,563) 681,586 (1,913,416) - 13,554,712
Excess/(deficiency)of revenues
over expenditures 143,817 1.198,713 (681,586) 2,006,283 - 2,667,227
Other financing sources/(uses):
Operating transfers in 2,275,886 - - - (2,275,886) -
Operating transfers out (2,275,886) - - - 2,275,886 -
Proceeds from issuance of debt 3,370,000 - - (3,370,000) - -
Bond premium 761 - - (761) - -
BANs redeemed from appropriations 68,000 - - (68,Qoo) - -
Total financing sources/(uses) 3,438,761 - - (3,438,761) - -
Change in fund balances $ 3,582,578 $ 1,198,713 $ (681,586) $ (1,432,478) $ - $ 2,667,227
See Notes to Financial Statements
14
TOWN OF WAPPINGER,NEW YORK
STATEMENT OF NET POSITION
FIDUCIARY FUNDS
FOR THE YEAR ENDED DECEMBER 31,2017
AGENCY
FUNDS
ASSETS
Cash and cash equivalents $ 607,823
Total assets $ 607,823
LIABILITIES
Escrow 1:unds returnable and other liabilities $ 607,823
Total liabilities 607,823
NET POSITION -
Total liabilities and net position $ 607,823
See Notes to Financial Statements
15
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Significant Accountiniz Policies
The Town of Wappinger,New York, ("the Town") was incorporated on May 20, 1875, under the provisions of the
State of New York. The Town operates under a Town Board form of government,consisting of a Supervisor and four
Councilmen/women. The Supervisor serves as the Chief Executive Officer and as the Chief Fiscal Officer of the
Town.
The Town provides the following services:highway maintenance,water,sewer,planning,zoning,building and safety
inspection,lighting,and culture and recreation.
The Town's financial statements are prepared in accordance with accounting principles generally accepted in the
United States of America as applied to governmental units(GAAP), The Governmental Accounting Standards Board
(GASB)is responsible for establishing GAAP for state and local governments through its pronouncements(Statements
and Implementation Guides).
The more significant accounting policies established by GAAP and used by the Town in preparing its government-
wide and fund financial statements are discussed below.
1. The Reportinu Entity
The Town,for financial purposes, includes all of the funds relevant to the operations of the Town of Wappinger,
New York. The financial statements include organizations, functions and activities that are controlled by or
dependent upon the Town,Control or dependence is determined on the basis of budget adoption,taxing authority,
funding and appointment of the respective governing board. Under these criteria,no other entities are included
in the Town's financial statements.
2. $asic Financial Statements—Government-Wide Statements
The Town's basic financial statements include both government-wide(reporting the Town as a whole)and fund
financial statements(reporting the Town's major funds).Both the government-wide and fund financial statements
categorize primary activities as either governmental or business type activities.The Town's parks and recreation,
public works, and general administrative services are classified as governmental activities. The Town's water
services are also classified as governmental activities since user fees are not intended to cover all costs including
depreciation.
In the government-wide Statement of Net Position, the governmental activities columns is presented on a
consolidated basis and is reported on a full accrual, economic resource basis, which recognizes all long-temi
assets and receivables as well as long-term debt and obligations. The Town's net position is reported in three
parts—net investment in capital assets,restricted and unrestricted.The Town first utilizes restricted resources to
finance qualifying activities.
The government-wide Statement of Activities reports both the gross and net cost of each of the Town's functions
or activities.The functions are also supported by general government revenues(property and sales taxes,certain
intergovernmental revenues,fines,permits and charges,etc.).The Statement of Activities reduces gross expenses
(including depreciation) by related program revenues, operating and capital grants. Program revenues must be
directly associated with the function(public works,community and youth services,etc.).Operating grants include
operating-specific and discretionary (either operating or capital)grants while the capital grants column reflects
capital-specific grants.
16
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Significant Accounting Policies(Continued)
2. Basic Financial Statements—Government-Wide Statements(Continued)
The net costs are normally covered by general revenue (property, sales or mortgage taxes, intergovernmental
revenues,interest income,etc).
This government-wide focus is more on the sustainability of the Town as an entity and the change in the Town's
net position resulting from the current year's activities.
3. Basic Financial Statements—Fund Financial Statements
The financial transactions of the Town are reported in individual funds in the fund financial statements. Each
fund is accounted for by providing a separate set of self-balancing accounts that comprises its assets, liabilities,
reserves, fund equity, revenues and expenditures/expenses. Funds are organized into three major categories:
governmental, proprietary, and fiduciary. An emphasis is placed on major funds within the governmental and
proprietary categories. A fund is considered major if it is the primary operating fund of the Town or meets the
following criteria:
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental fund or
enterprise fund are at least 10 percent of the corresponding total for all funds of that category or type;
and
b. Total assets, liabilities, revenues, or expend itureslexpenses of the individual governmental fund or
enterprise fund are at least 5 percent of the corresponding total for all governmental and enterprise
funds combined.
The following fund types are used by the Town:
A. Governmental Funds
The focus of the governmental funds' measurement (in the fund statements) is upon determination of
financial position and changes in financial position(sources,uses,and balances of financial resources)rather
than upon net income.
The following is a description of the governmental funds of the Town:
I. General Fund—Town-wide is the general operating fund of the Town. It is used to account for all
financial resources except those required to be accounted for in another fund. The General Fund is
considered a major fund and is presented separately.
2. General Fund—Part-Town is used to record revenues and expenditures related to services provided to
residents living outside the'Village of Wappingers Falls,such as police protection,planning and zoning
services. The General Fund—Part-Town is considered a major fund and is presented separately.
3. Highway Fund is used to record the revenues and expenditures related to the maintenance of Town
roadways. The Highway Fund is considered a major fund and is presented separately,
4. Water Fund is used to record the revenues and expenditures related to the delivery of water to the
Town's customers. The Water Fund is considered a major fund and is presented separately.
17
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Sienificant Accounting Policies(Continued)
3. Basic Financial Statements—Fund Financial Statements(Continued)
A. Governmental Funds(Continued)
5, Sewer Fund is used to record the revenues and expenditures related to the delivery of sewer services to
the Town's customers. The Sewer Fund is considered a major fund and is presented separately,
6. Capital Projects Fund is used to account for financial resources to be used for the acquisition and
construction of major capital facilities. The Capital Projects Fund is considered a major fund and is
presented separately. However, no budgetary comparison schedule is presented as required
supplemental information,as the Town is not legally required to adopt an annual budget for the Capital
Projects Fund.
7, Non-Major Funds include those that are used to account for the proceeds of specific revenue sources
that are legally restricted to expenditures for specified purposes. These include the Lighting,Ambulance
and Special Grant Funds.
B. Fiduciary Funds
Fiduciary Funds are used to report assets held in a trustee or agency capacity for others and therefore are not
available to support Town programs. The reporting focus is on net position and changes in net position,and
they are reported using accounting principles similar to proprietary funds,
The Town's fiduciary funds are presented in the fiduciary fund financial statements.Since by definition these
assets are being held for the benefit of a third party and cannot be used to address activities or obligations of
the government,these funds are not incorporated into the government-wide statements.
4. Basis of Accountine
Basis of accounting refers to the point at which revenues or expenditures/expenses are recognized in the
accounts and reported in the financial statements, It relates to the timing of the measurements made
regardless of the measurement focus applied.
A. Accrual
The governmental activities in the government-wide financial statements and fiduciary fund financial
statements are presented on the accrual basis of accounting, Revenues are recognized when earned and
expenses are recognized when incurred.
B. Modified Accrual
The governmental funds financial statements are presented on the modified accrual basis of accounting,
Under the modified accrual basis of accounting,revenues are recorded when susceptible to accrual;i.e.,both
measurable and available. "Available" means collectible within the current period or within 60 days after
year-end. Expenditures are generally recognized under the modified accrual basis of accounting when the
related liability is incurred. The exception to this general rule is that principal and interest on general
obligation long-term debt, if any,is recognized when due.
18
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Sienificant Accountine Policies(Continued}
5. Financial Statement Amounts
A. Cash and Cash Equivalents
Cash and cash equivalents includes amounts in demand and time deposits. State statutes and the Town's own
written investment policy govern the investment policies of the Town. The Town may invest its funds in
banks or trust companies authorized to do business in the State of.New York, as well as obligations of the
U.S. Treasury, U.S. Agencies, and obligations of the State of New York and its political subdivisions.
Deposits not covered by Federal Deposit Insurance are collateralized by the banking institutions with
investments governed under state statutes.
The cash and cash equivalents of the Town at December 31,2017,are as follows:
CAMAL NON-
GENERAL 111GHWAY WATER SIMM PROJFCTS MAJOR
FUNDS FUND FUND FUND FUND FUNDS TOTAL
Non-Interest
Bearing Accounts $ 850 $ - $ - $ $ - $ - $ 850
Interest Bearing
Accounts 5,364,644 1,358,523 2,529,325 1,825,746 3,502,548 162,746 14,743,532
TOTAlS $5,365,494 $1,358,523 $2,529,325 $1,825,746 $ 3,502,548 $162,746 $14,744,382
Custodial credit risk is the risk that, in the event of a bank failure,the Town's deposits may not be returned
to it. While the Town does not have a specific policy for custodial credit risk,New York State statues govern
the Town's investment policies,as discussed previously in these Notes. Governmental Accounting Standards
Board Statement No.40 Deposit and Investment Risk Disclosure directs that deposits be disclosed as exposed
to custodial credit risk if they are not covered by depository insurance,or collateralized by securities held by
the Town or its agent in the Town's name.The Town's cash balances in excess of FDIC coverage were fully
collateralized with securities held by the Town's depository institution's agent and not subject to custodial
credit risk,
B. Inventories
Inventories consist of significant expendable supplies,primarily sand and road salt,and are carried at cost.
C. Capital Assets
Capital assets purchased or acquired with an original cost of$500 or more are reported at historical cost or
estimated historical cost. Contributed assets are reported at fair market value as of the date received.
Additions, improvements and other capital outlays that significantly extend the useful life of an asset are
capitalized.Other costs incurred for repairs and maintenance are expensed as incurred.
Depreciation on all assets is provided on the straight-line basis over the following estimated useful lives:
Buildings 15-40 years
Infrastructure—Water&Sewer 40 years
Infrastructure—Roads 15 years
Machinery and Equipment 5-15 years
Improvements 10-30 years
19
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summaa of Significant Accounting Policies Continued
5. Financial Statement Amounts(Continued)
Infrastructure assets include roads,bridges,underground pipe(other than related to utilities),traffic signals,
etc.These infrastructure assets are likely to be the largest asset class of the Town.
D. Fund Balance Classifications
Fund balance is presented in five different classifications which focus on the constraints imposed on resources
in governmental funds, rather than on availability for appropriation. The classifications include: non-
spendable,restricted,committed,assigned,and unassigned.
Non-spendable consists of assets that are inherently non-spendable in the current period either because of
their form or because they must be maintained intact,including prepaid items,inventories,long-term portions
of loans receivable,financial assets held for resale,and principal of endowments.
Restricted consists of amounts that are subject to externally enforceable legal purpose restrictions imposed
by creditors,grantors,contributors, or laws and regulations of other governments; or through constitutional
provisions or enabling legislation.
Committed consists of amounts that are subject to a purpose constraint imposed by a formal action of the
government's highest level of decision-making authority before the end of the fiscal year, and that require
the same level of formal action to remove the constraint. The Board is the decision-making authority that
can,prior to the end of the fiscal year,commit fund balance.
.Assigned consists of amounts that are subject to a purpose constraint that represents an intended use
established by the government's highest level of decision-making authority, or by their designated body or
official.The purpose of the assignment must be narrower than the purpose of the General Fund,and in funds
other than the General Fund,assigned fund balance represents the residual amount of fund balance.
Unassigned represents the residual classification for the government's General Fund, and could report a
surplus or deficit.In funds other than the General Fund,the unassigned classification should be used only to
report a deficit balance resulting from overspending for specific purposes for which amounts had been
restricted,committed,or assigned.
When resources are available from multiple classifications, the Town spends funds in the following order:
restricted,committed,assigned,unassigned.
The following details the restricted allocations and amounts of fund balance at December 31,2017:
The Town has $505,800 of restricted fund balance resulting from funds received from the NYC DEP for
future capital projects in the United Wappinger Water District. The Town has $660,744 of unassigned but
restricted funds for recreation, which includes funds commonly referred to as Parkland Trust deposits, as
well as funds set-aside for the Carnwath property. The Town also has$870,503 in funds restricted for debt
service payments,and$402,900 in funds restricted for other miscellaneous purposes.
20
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
MOTE A-Summary of Si nificant Accountine Policies Continued
5. Financial Statement Amounts(Continued)
E. Deficit Fund Balances
The following have deficit fund balances at December 31,2017:
Deficit
Sewer Fund: Balance
Sewer Improvement Area#5 $ (3,032)
$ (3,032)
Deficit
Capital Projects: Balance
Resurfacing Various Roads $ (278,069)
W ildwood Sewer District (46,212)
Mid-Point Collection System Improvement (226,488)
$ (550,769)
*The deficit will be eliminated as short term debt is converted to permanent financing.
The Town expects to receive additional revenues to cover these deficit balances in the future.
F.Accumulated Compensated Absences
It is the Town's policy to permit employees to accumulate a limited amount of earned but unused vacation
and sick leave, which will be paid to employees upon separation from the Town's service. Other Town
employees may accumulate a limited amount of unused compensated absences as well. The Town accrues a
liability for compensated absences that meet the following criteria:
1. The Town's obligations relating to employees'rights to compensation for future absences is
attributable to employee services already rendered;
2. The obligation relates to rights that vest or accumulate;
3. Payment of the compensation is probable;
4. The amount can be reasonably estimated.
In accordance with the above criteria, the Town has accrued a liability for vacation pay, which has been
earned and not taken by Town employees as of December 31, 2017, in the amount of$279,852. The non-
current portion (the amount estimated to be used in subsequent fiscal years) for governmental funds is
maintained separately and represents a reconciling item between the fund and government-wide
presentations. It is anticipated that none of these liabilities will be liquidated with expendable available
financial resources.
21
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Significant Accounting Policies(Continued)
5. Financial Statement Amounts(Continued)
G. [nterfund Activity
Interfund activity is reported as loans,services provided,reimbursements or transfers.Loans are reported as
interfund receivables and payables as appropriate and are subject to elimination upon consolidation.Services
provided, deemed to be at market or near market rates, are treated as revenues and expenditures/expenses.
Reimbursements are when one fund incurs a cost, charges the appropriate benefiting fund and reduces its
related cost as a reimbursement. All other interfund transactions are treated as transfers.Transfers between
governmental funds are netted as part of the reconciliation to the government-wide financial statements.
H.Budgets
The Town employs formal budgetary accounting as a management tool,on a basis consistent with generally
accepted accounting procedures. During the year,a budget was adopted and modified by the Town Council
for the General Fund —Town Wide, General Fund —Part Town, .E{ighway Fund, Water Fund, and Sewer
Fund. Budgetary controls are established or adopted for the Capital Projects Fund on a project basis. Unused
appropriations of the annually budgeted funds lapse at the end of the year.
I.Property Taxes
The Town submits an approved budget to the Dutchess County Commissioner of Finance by December 5th
of the previous year. The County then establishes the warrant for the year,which is due and payable on or
about January 1 of each year. The Town collects the taxes on behalf of the Town and County without penalty
through February 28th and with penalties and interest through August 31 st. The Town's portion of the taxes
is recognized and transferred prior to the County's portion. Therefore, the Town receives its entire tax,
leaving the unpaids to be collected by the County Commissioner of Finance.
J. Long-Term Liabilities
Long-term debt is recognized as a liability of a governmental fund when due, or when resources have been
accumulated for payment early in the following year. For other long-term obligations, only that portion
expected to be financed from expendable available financial resources is reported as a fund liability of a
governmental fund. The remaining portion of such obligations is only reported in the statement of net assets,
long-term liabilities.
K. Risk Management
The Town of Wappinger assumes the liability for most risk including, but not limited to, property damage
and personal injury liability. Such risks are covered by the purchase of commercial insurance. Judgments
and claims are recorded when it is probable that an asset has been impaired or a liability has been incurred
and the amount of loss can be reasonably estimated. Workers compensation coverage is provided through a
retrospective policy,wherein premiums are recorded based on the ultimate cost of the experience to date of
workers in similar occupations. The Town does not estimate claims that may have occurred but are not
reported in areas where the Town is not insured.
22
TOWN OF WAPPINGER,NEW YORK
NOTES TO TUE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE A-Summary of Significant Accountinff Policies{Continued)
5. Financial Statement Amounts(Continued)
L.Use of Estimates
The preparation of basic financial statements,in conformity with accounting principles generally accepted in
the United States of America, requires management to make estimates and assumptions that affect the
amounts reported in the basic financial statements and the accompanying notes. Actual results could differ
from those estimates.
M.Subsequent Events
Management has evaluated subsequent events for disclosure and/or recognition in the financial statements
through October 4,2418,the date that the financial statements were available to be issued.
Subsequent events noted during management's evaluation are detailed in Note O.
NOTE B — Explanation of Certain Differences Between Governmental Fund Statements and Government-
Wide Statements
Due to the differences in the measurement focus and basis of accounting used in the governmental fund statements
and the government-wide statements, certain financial transactions are treated differently, The differences result
primarily from the economic focus of the government-wide statements,compared with the current financial resources
focus of the government funds.
1. Total Fund Balances of Governmental Fundsvs.Net Position of Governmental Activities:
Total fund balances of the Town's governmental funds differ from "net position" of governmental activities
reported in the Statement of Net Position. This difference primarily results from the additional long-term
economic focus of the Statement of Net Position versus the solely current financial resources focus of the
Governmental Funds Balance Sheet.
23
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2417
NOTE B — Explanation of Certain Differences Between Governmental Fund Statements and Government-
Wide Statements
1. Total Fund Balances of Governmental Funds vs.Net Position of Governmental Activities:
The basic financial statements contain a tabular reconciliation of the items creating the differences between Fund
Balance reported in the Governmental Fund Statements and Net Position reported on the Statement of Net
Position.
Total fund equity for governmental funds $ 15,918,647
Total net position reported for governmental activities in the statement
of net position is different because:
Capital assets used in governmental activities are not
financial resources and therefore are not reported in the funds. 64,654,858
Long-term liabilities,including bonds payable,landfill remediation,
compensated absences,other postemployment benefits,
judgement and claims,and net employee retirement system
liabilities are not due and payable in the current period
and therefore are not reported in the fiends. (26,886,501)
Grants received for capital assets are deferred and amortized
overthe life ofthe asset. (15,746)
Residual fund balance and related receivables fromthe
Tri-Municipal Sewer Commission are not reported in the fiends. 584,424
Premiums on bond refundings are deferred and amortized over the life ofthe debt. (1,105,274)
Losses on bond refundings are deferred and amortized overthe life ofthe debt. 499,345
Deferred outflows related to the employee retirement system
liability are not reported in the funds. 1.,009,708 .
Deferred inflows related to the employee retirement system
liability are not reported in the funds. (138,429)
Prepaid expenses related to the employee retirement system are reported
in the funds,but are adjusted in the government wide statements. (97,869)
Accrued interest is not reported in the funds. (244,478)
Total net position of governmental activities $ 54,218,685
24
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE B — Explanation of Certain Differences Between Governmental Fund Statements and Government=
Wide Statements(Continued)
2. Explanation of Differences Between Governmental Funds Operating Statement and the Statement of
Activities:
Differences between the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund
Balance and the Statement of Activities fall into one of three broad categories:
• Long-term revenue differences arise because governmental funds report revenues only when they are
considered "available", whereas the Statement of Activities reports revenues when earned. Differences in
long-term expenses arise because governmental funds report on a modified accrual basis,whereas the accrual
basis of accounting is used on the Statement of Activities.
• Capital related differences include the difference between proceeds for the sale of capital assets reported on
governmental fund statements and the gain or loss on the sale of assets as reported on the Statement of
Activities, and the difference between recording an expenditure for the purchase of capital items in the
governmental fund statements and depreciation expense on those items as recorded in the Statement of
Activities.
• Long-term debt transaction differences occur because both interest and principal payments are recorded as
expenditures in the governmental fund statements when paid,whereas interest payments are recorded in the
Statement of Activities as incurred and principal payments are recorded as a reduction of liabilities in the
Statement of Net Position.
The basic financial statements contain a detailed reconciliation of the items creating the differences between the
change in fund balance reported in the governmental fund statements and the change in net position reported in
the Statement of Activities.
Net change in fund balance-total government Rinds $ 3,582,578
The change in net position reported forgovemmental activities in the
statement of activities is different because:
Governmental funds report all capital outlays as expenditures. However,in the
statement of activities,the cost of certain assets is allocated over their estimated
useful lives and reported as depreciation expense. This is the amount by which
depreciation exceeded capital outlay in the current period. (681,586)
Grants received for capital projects are amortized over the life of the asset. This
is the amount by which the grant exceeded the amortization in the current period. 3,150
25
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE B— Explanation of Certain Differences Between Governmental Fund Statements and Government-
Wide Statements(Continued)
2. Ex lanation of Differences Between Governmental Funds Overatin2 Statement and the Statement of
Activities-(Continued):
Bond proceeds are reported as financing sources in governmental funds and
thus contribute to the change in fund balance. In the statement of net position,
however,issuing debt increases long-term liabilities and does not affect the
statement ofactivities. Similarly,repayment of principal is an expenditure in
the governmental funds but reduces the liability in the statement of net position.
Debt issued:
Bond anticipation notes redeemed (68,000)
Proceeds from bond issuance (3,370,000)
Repayments:
Bond anticipation note principal 68,000
Bond principal 1,890,610 (1,479,390)
Premiumand loss on bond refundings are deferred and amortized over the life ofthe debt, 50,494
In the statement of activities,interest is accrued on outstanding bonds,whereas
in governmental fiends,an interest expenditure is reported when due. This amount
represents the change between what was paid and what was accrued through 2017, (3,582)
Change in residual fund balance due fromthe Tri-Municipal Sewer Commission
is not reported in the funds. 128,242
Change in net employee retirement system liability,related deferred outtlows,
and related deferred inflows is not reported in the funds. (124,502)
Some expenses reported in the statement of activities,such as retainage,
compensated absences,landfill closure,and postemployment benefits do not
require the use ofcurrent financial resources and therefore are not reported as
expenditures in governmental funds. This amount represents the change between
what was paid and what was accrued through 2017. 1,191,823
Net change in net position of governmental activities $ 2,667,227
26
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE C-interfund Receivables and Pavables and Transfers
The following is a summary of amounts due from and due to other funds, and transfers in and out,as of and for the
year ended December 31, 2017. These interfund balances have been eliminated as part of the aggregation of fund
balances. Such balances arise through the use of a pooled cash disbursement account and the temporary funding of
capital projects.
TRANSFERS TRANSFERS
FUND IN OUT
General-Town-Wide $ - $ 1,899,772
Water - 36,820
Sewer 88,851 265,033
Capital Projects 2,181,029 74,261
Non-Major Funds 6,006 -
TOTALS S 2,275,886 $ 2,275,886
AMOUNT AMOUNT
FUND RECEIVABLE PAYABLE
General-Town-Wide $ 224,986 $ 1,724,619
General-Part-Town - 6,471
Highway 18,039 21,886
Water - 567,488
Sewer 161,132 258,394
Capital Projects 2,493,679 31.3,488
Non-Major Funds 6,006 11,496
TOTALS $ 2,903,842 $ 2,903,842
27
TOWN OF WAPPINCER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
I
i
i
NOTE D—Capital Assets
The following is a summary of changes and adjustments in capital assets,for the year ended December 31,2017:
BALANCE BALANCE
DECEMBER 31, DECEMBER 31,
2016 ADDITIONS (DISPOSALS) 2017
land $ 8,162,217 $ - $ - $ 8,162,217
Buildings 8,351,109 165,884 - 8,516,993
Improvements Other Than Buildings 2,065,479 - - 2,065,479
Roads 10,223,395 596,634 (194,623) 10,625,406
Infrastructure 152,503,851 173,771 - 152,677,622
Machinery and Lcluipment 6,697,560 101,716 - 6,799,276
Construction in Progress 8,519,201 755,319 - 9,274,520
Total 196,522,812 1,793,324 (194,623) 198,121,513
Less accumulated depreciation
Buildings 4,027,486 239,194 - 4,266,680
Improvements Other Than Buildings 850,153 89,755 - 939,908
Roads 7,041,109 358,552 (194,623) 7,205,038
Infrastructure 114,126,874 1,520,346 - 115,647,220
Machinery and Equipment 5,140,746 267,063 - 5,407,809
Total accumulated depreciation 131,186,368 2,474,910 (194,623) 133,466,655
Governmental activities capital
assets,net $ 65,336,444 $ (681,586) $ - $ 64,654,858
*Depreciation was charged to governmental activities as follows:
Gcncralgovernment support $ 147,222
Public safety 72,875
Transportation 596,046
Culture and recreation 127,901
Home and community services 1,530,866
Total depreciation expense $ 2,474,910
28
TOWN OF WAPPINGER,NEW YORK
NOTES TO TRE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE E—Pension Plans
1. Plan Description
The Town of Wappinger participates in the New York State and Local Employees'Retirement System(ERS)(the
System). ERS is a cost-sharing multiple-employer retirement system. The System provides retirement benefits
as well as death and disability benefits. Obligations of employers and employees to contribute and benefits to
employees are governed by the New York State Retirement and Social Security Law(NYSRSSL).
As set forth in the NYSRSSL,the Comptroller of the State of New York(Comptroller)serves as sole trustee and
administrative head of the System. The Comptroller shall adopt and may amend rules and regulations for the
administration and transaction of the business of the System and for the custody and control of the finds. The
System issues a publicly available financial report that includes financial statements and required supplementary
information.That report may be obtained by writing to the New York State and Local Retirement Systems, 110
State Street,Albany,New York 12244.
2. Fundine Policy
The System is noncontributory except for employees who joined the New York State and Local Employees'
Retirement System after July 27, 1976,who contribute 3%of their salary.Under the authority of the NYSRSSL,
the Comptroller shall certify annually the rates of participating employers expressed as proportions of payroll of
members,which shall be used in computing the contributions required to be made by employers to the pension
accumulation fund.
The Town of Wappinger is required to contribute to the Systems at an actuarially determined rate. The required
contributions for the current year and two preceding years were:
2017 2016 2015
$ 420,822 $ 504,348 $ 497,076
The Town's contributions made to the Systems were equal to or in excess of 1.00 percent of the contributions
required for each year.
3. Pension Liabilities,Pension Expense,and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions
At December 31, 2017, the Town reported a liability of$824,911. for its proportionate share of the net pension
liability. This amount is recorded as a long-term liability due to the NYS Retirement System. The net pension
liability was measured as of March 31, 2017, and the total pension liability used to calculate the net pension
liability was determined by an actuarial valuation as of that date. The Town's proportion of the net pension
liability was based on a projection of the Town's long-term share of contributions to the pension plan relative to
the projected contributions of all participating members,as actuarially determined.
At March 31,2017,the Town's proportion was 0.0087792 percent of the Employers'Retirement System liability,
which was an decrease of 0.0004042 from its proportion measured as of March 31,2016.
28
TOWN OF WAPPINCER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE E—Pension Plans(Continued)
3. Pension Liabilities,Pension Expense,and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions(Continued)
For the year ended December 31, 2017, the Town recognized pension expense of$518,544. At December 31,
2017, the Town reported deferred outflows of resources and deferred inflows of resources related to pensions
from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience $ 20,671 $ 125,267
Changes of assumptions 281,820 -
Net difference between projected and actual investment eamings 164,768
on pension plan investments
Changes in proportion and differences between employer 150,974
contributions and proportionate share of contributions 13,1.62
Employer contributions subsequent to the measurement date 391,475 -
Total $ 1,009,708 $ 138,429
$391,475 reported as deferred outflows of resources related to pensions resulting from the Town's contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended
December 31,2018.Other amounts reported as deferred outflows of resources and deferred inflows of resources
related to pensions will be recognized in pension expense as follows:
Year ended December 31:
2018 $ 202,156
2019 $ 202,156
2020 $ 174,731
2021 $ (99,239)
Actuarial Assumptions
The total pension liability at March 31,2017,was determined by using an actuarial valuation as of April 1,2016,
with update procedures used to roll forward the total pension liability to March 31,2017.The actuarial valuation
used the following actuarial assumptions:
Inflation 2.5%
Salary increases -ERS 3,8%
Interest rate of return 7.0%
Cost of living adjustments 1.3%
Annuitant mortality rates are based on April 1, 2010—March 31, 2016 System experience with adjustments for
mortality improvements based on the Society of Actuaries' Scale MP-2014.
The actuarial assumptions used in the April 1,2016 valuation are based on the results of an actuarial experience
study for the period April 1,2010-March 31,2016,
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 investment expense
and inflation) 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 of the target asset allocation percentage
and by adding expected inflation.
29
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL.STATEMENTS
DECEMBER 31,2017
NOTE E—Pension Plans(Continued)
3. Pension Liabilities,Pension Expense,and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions Continued
Actuarial Assumptions Continued
Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation
as of March 31,201.7 are summarized below:
Long-Term
Expected Real
Asset Class Rate of Return
I)omestic equity 4,55%
International equity 6,35%
Private equity 7.75%
Real estate 5.800/0
Absolute return strategies 4.00%
Opportunistic portfolio 5.89%
Real assets 5.54%
Bonds and mortgages 1.31%
Cash -0.25%
Inflation-indexed bonds 1.50%
Discount Rate
The discount rate used to calculate the total pension liability was 7.0%. The projection of cash flows used to
determine the discount rate assumes that contributions from plan members will be made at the current contribution
rates and that contributions from employers will be made at statutorily required rates, actuarially. Based upon
these assumptions,the System'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 pension plan
investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the Proportionate Share of the Net Pension Liability to the Discount Rate Assumption
The following presents the Town's proportionate share of the net pension liability calculated using the discount
rate of 7.0 percent,as well as what the Town's proportionate share of the net pension liability would be if it were
calculated using a discount rate that is 1-percentage-point lower(6.0 percent)or 1-percentage-point higher(8.0
percent)than the current rate:
I% Current 1%
Decrease Assumption Increase
(6.0%) (7.0%) (8.4%)
Town's proportionate share of the
net ERS pension(liability)asset $(2,634,601) $ (824,911) $ 705,179
30
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE E—Pension Plans(Continued)
3. Pension Liabilities Pension Expense,and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions(Continued)
Pension plan fiduciary net position
The components of the current-year net pension liability of all employers as of March 31,2017,were as
follows:
Dollars in Thousands
Employees'
Retirement
System
Employers'total pension liability $ (177,400,586)
Plan net position 168,004,363
1_tnployers'net pension liability $ (9,396.223)
Ratio of plan net position to the
94'7%
employers'total pension liability
NOTE F—Other Posternployment Benefits
1. Plan Description
Under accrual accounting, the cost of postemployment healthcare benefits, like the cost of pension benefits,
generally should be associated with the periods in which the cost occurs, rather than in the future year when it
will be paid, which is the modified accrual accounting perspective, In adopting the requirements of GASB
Statement No.45,Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than
Pensions, the Town recognizes, in the government wide financial statements, the cost of postemployment
healthcare in the year when the employee services are received,reports the accumulated liability from prior years,
and provides information useful in assessing potential demands on the Town's future cash flows.
Recognition of the liability accumulated from prior years is being phased in over 30 years. The Town calculated
its annual required contribution (ARC) and related information using the alternative measurement method
permitted by GASB No.45 for employers in plans with fewer than 100 total plan members.
31
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE F—Other Postemployment Benefits(Continued)
1. Plan Description(Continued)
The Town provides continuation of medical insurance coverage to employees that retire under the New York
Retirement Systems at the same time they end their service to the Town. This plan is a single employer plan,
established by authority of the Town.Board and administered by the Town. Currently,there are approximately
15 retirees or beneficiaries receiving postemployment benefits. Based on the current employment policy, the
retiree and his or her beneficiaries receive coverage for the life of the retiree based on the retiree's years of service
at retirement. A copy of the report on these benefits can be requested at Town Hall, A summary of benefits is as
follows:
%Paid by Town
Under 65 Over 65
Years of Service
10-14 Years 35% 35%
1519 Years 50% 50%
20-2.4 Years 60% 60%
25 or More Years 70% 700/0
The Town provides funding on the pay-as-you-go method by payment of current insurance premiums. Currently,
New York's General Municipal Laws do not permit funding of the OPEB obligation;therefore,there are no plan
assets.
2. Annual Other Postemployment Benefit Cost
The Town's change in net OPEB obligation amounted to ($1,154,453)for the year ended December 31, 2017.
The Annual Required Contribution(ARC)is an amount actuarially determined in accordance with the parameters
of GASB Statement 45 less the amount that the Town paid in the current year for retirees. Included in this year's
calculation is a decrease.of$1,057,463,representing the effect of changing certain plan assumptions. The ARC
represents a level of funding that,if paid on an ongoing basis,is projected to cover normal costs plus a past service
cost each year and amortize any unfunded actuarial liabilities over a period of 30 years.
Total Actuarial Accrued Liability $ 7,495,503
Past Service Costs $ 385,052
Normal Costs -
Annual Required Contribution(ARC) $ 385,052
Net OPEB Obligation-beginning of the year $ 4,189,749
Annual Required Contribution(ARC) 385,052
Interest on Net OPEB Obligation 224,632
Etleet ofAsumption Changes or Inputs (1,057,463)
Adjustment to Annual Required Contribution (607,819)
Annual OPEB cost (1,055,598)
Age Adjusted Contributions Made* (98,855)
Decrease in Net OPEB Obligation (1,154,453)
Net OPEB Obligation-end of the year $ 3,035,296
Percent of annual OPEB cost contributed -9.4%
*This contribution is the pay-as-you-go amount,as an actual plan
32
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE F-Other Postemplovment Benefits(Continued)
2. Annual Other Postemployment Benefit Cost(Continued)
%of Annual Net OPFB
Year Annual OPEB Cost Obligation
Ended OPF.B Cost Contributed at Fod of Year
12/31/2017 $(1,055,598) -9.40% $ 3,035,296
12/31/2016 $ 689,620 15.70% $ 4,189,749
12/31/2015 $ 534,534 14.50% $ 3,608,676
12/31/2014 $ 523,473 13.70% $ 3,151,793
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about
the probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality, and the healthcare cost trend. Valuations also involve determining amounts regarding
the funding status of the pian and the annual expectation and new estimates about the future. The schedule of
funding progress,presented as required supplementary information following the notes to the financial statements,
presents multi-year trend information about whether the actuarial value for plan assets is increasing or decreasing
over time relative to the actuarial accrued liabilities for benefits.
3. Actuarial Methods and Assumations
Projections of benefits for financial reporting purposes are based on the substantive plan(the plan as understood
by the employer and the plan members)and include the types of benefits provided at the time of each valuation
and the historical pattern of sharing benefit costs between the employer and plan members to that point. The
actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value of assets,consistent with the long-term perspective
of the calculations.In the December 31,2017, actuarial valuation, the liabilities were computed using the entry
age actuarial cost method and level percentage of payroll amortization, The actuarial assumptions utilized a 2.5%
baseline discount rate.
The valuation assumes the following rates of increase in health care costs:
Fiscal Prescription
Year Medical Drug Dental Vision
Year 1 4.60% 7.60% 4.00% 3.000/6
Year 2 4.70% 6.20% 3.50% 3.00%
Year 3 4.80% 4.901/10 3,00% 3.0011/6
Year 4 4ffl% 4.80% 3.001/16 3.00%
Year 5 4.80% 4.801/16 3.00% 3.00%
Year 6 4.80% 4.800/9 3.00% 3.00%
Year 7 4,70% 4.70% 3.00% 3.00%
Year 8 4.700/. 4.70% 3.00% 3.00%
Year 9 4.70% 4.70% 3.00% 3.000/0
Year 10+ 4.7011/o 4.70% 3.00% 3.000/0
33
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE G-Bond Anticipation Notes Payable
Bond anticipation notes can be used for any purpose for which bonds are authorized,and are generally accounted for
in the capital projects fund,since maturities cannot exceed one year. Local finance law allows the notes to be renewed,
up to five years for capital purposes and up to the period of probable usefulness for assessable improvements,provided
that stipulated annual reductions of principal are made.
The Town issued $930,000 in bond anticipation notes dated November 8, 2017, and maturing on June 21, 2018, at
2.00% interest. The notes were issued for the purpose of renewing outstanding notes for various improvements,
construction projects,and equipment purchases.
The bond anticipation notes outstanding as of December 31,2017,are as follows:
AMOUNT
OUTSTANDING
ORIGINAL ORIGINAL AT
ISSUE MATURITY INTEREST AMOUNT DECEMBER 31,
PURPOSE DATE DATE RATE OFISSUE 2017
United Wappinger Sewer District Improvements 09126113 03/24/17 0.95% $ 580,000 $ -
Water Meter Rep tacement 09/22/15 03/24/17 0,95% 1,793,000 -
Tri-Municipal Sewer Commission 09/22/15 03/24/17 0.95% 945,000 -
Maintenance Equipment 03/24/16 03/24/17 0.95% 505,000 -
Collection System Improvements 11/08/17 06/21/18 2.001/1., 280,000 280,000
highway Blacktop Maintenance 1110811.7 06/21/18 2.00% 650,000 650,000
TOTAL BOND ANTICIPATION NOTES $ 4,753,000 $ 930,000
Changes in bond anticipation notes payable as of December 31,2017,are as follows:
BALANCE BALANCE
DECEMBER 31, NEW DECEMBER 31,
PURPOSE 20.16 ISSUES PAYDOWNS 2017
United Wappinger Sewer District Improvements $ 570,000 $ - $ (570,000) $ -
Water Meter Replacement 1,793,000 - (1,793,000) -
Tri-Municipal Sewer Commission 570,000 - (570,000) -
Maintenance Equipment 505,000 - (505,000) -
Collection System Improvements - 280,000 - 280,000
Highway Blacktop Maintenance - 650,000 - 650,000
TOTALS $ 3,438,000 $930,000 $(3,438,000) $ 930,000
34
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 3.1,20.17
NOTE H-Lone-Term Liabilities
1. Serial Bonds
Serial bonds may be issued for any object or purpose for which a period of probable usefulness has been
established. The serial bonds payable,as of December 31,2017,are as follows:
AMOUNT
OUTSTANDING
ORIGINAL FINAL ORIGINAL AT
ISSUE MATURITY INTEREST AMOUNT DECEMBER31,
PURPOSE DATE DATE RATE OFISSUE 2017
Server-Tri-Municipal 03/14/02 04/15/21 1.214.98% $ 9,836,556 $ 2,335,000
Water-Fleetwood 07/30/98 10/15/18 3.70-5.15% 510,000 35,000
Sewer-Home&Community Services 06/02/11 04/01/21 2.75-3.50% 316,000 140,000
Greystone Property Purchase 06/02/11 10/01/20 2.00-3.50% 2,085,0W 450,000
12,747,556 2,960,000
:Highway-Transportation 1,184,640 851,618
General-General Government Support 50,000 35,945
General-Culture&Recreation 163,360 117,437
0312711.4 03/15/24 1.50-2.75% 1,398,000 1,005,000
General-Culture&Recreation 1,070,000 183,021
Highway-Transportation 1,074,000 183,645
General-Home&Community Services 1,218,000 208,334
04/02/09 04/01/22 2,00-5,00% 3,362,000 575,000
Water-Home&Community Services 360,000 225,000
Sewer-Home&Community Services 576,000 360,000
General-Culture&Recreation/Lighting 504,000 315,000
03/05/13 03/01/23 2.00-2,25% 1,440,000 900,000
General-General(iovemment Support 400,610 390,280
Highway-Transportation 1.,365,000 1,329,800
Water-Home&Community Services 3,585,000 3,492,555
Sewer-Home&Community Services 490,000 477,365
0312411.6 03/15/36 2.25-3.00% 5,840,610 5,690,000
General-General Go vernment Support 1,106,995 1,042,681
Highway-Transportation 1,742,500 1,641,263
Water-Home&Community Services 5,507,077 5,187,123
Sewer-Home&Community Services 163,428 153,933
04/26/16 04/01/29 1.00-5.00% 8,520,000 8,025,000
Sewer-Tri-Municipal 562,000 562,000
Sewer-Tri-Municipal 563,000 563,000
Water-Home&Community Services 1,775,000 1,775,000
Highway-Transportation 470,000 470,000
03/23/17 03/15/37 2.5-3.25% 3,370,000 3,370,000
TOTALS $36,678,166 $ 22,525,000
35
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE H-Long-Term Liabilities(Continued)
2. Changes
The changes in the Town's indebtedness during the year ended December 31,2017,are summarized as follows:
BALANCE BALANCE AMOUNTS
DECEMBER 31, DECEMBER 31, DUE WITHIN
2016 INCREASE (DECREASE) 2017 ONEYEAR
Judgement&Claims
Note L 1. $ 80,000 $ - $ - $ 80'(W $ -
Compensated Absences
Note A.5.F. 273,153 6,699 - 279,852 -
Landfill Remediation
Note J 148,778 - (7,336) 141,442 7,640
Serial Bonds
Note H.1. 21,045,610 3,370,000 (1,890,610) 22,525,000 2,105,000
OtherPostemploymenl Benefits
Note F 4,189,749 - (1,154,453) 3,035,296 -
Net Employee Retirement System
Note E 1,473,969 - (649,058) 824,911 -
TOTALS $ 27,211,259 $ 3,376,699 $ (3,701,457) $ 26,886,501 $ 2,112,640
3. Debt Service Requirements
The annual requirements to amortize bonded debt,as of December 31,2017,are as follows:
YEAR ENDING
DECEMBER 31 PRINCIPAL INTEREST TOTAL
2018 $ 2,105,000 $ 771,814 $ 2,876,814
2019 2,185,000 649,719 2,834,719
2020 2,255,000 569,269 2,824,269
2021 2,165,000 487,251 2,652,251
2022 1,575,000 421,747 1,996,747
2023-2027 5,775,000 1,497,407 7,272,407
2028-2032 3,960,000 621,515 4,581,515
2033-2037 2,505,000 175,684 2,680,684
TOTALS $ 22,525,000 $ 5,194,406 $27,719,406
NOTE I-Commitments and Contineent Liabilities
1. Lawsuits
The Town is a defendant in various lawsuits and tax certiorari cases. The outcome of the majority of these cases
and lawsuits, as determined by the town attorney, should not result in material unfavorable settlements. The
Town has recorded an estimated liability amounting to $80,000 as judgment and claims, representing possible
future settlements on tax certiorari cases.
36
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS �
3
DECEMBER 31,2017
NOTE I-Commitments and Contin ent Liabilities Continued
2. Tri-Municipal Sewer Commission
The Town is a customer of the Tri-Municipal Sewer Commission which operates the Tri-Municipal Sewer
Treatment Plant. The plant is managed by the Tri-Municipal Sewer Commission, which is made up of
representatives of the Town of Poughkeepsie and the Village of Wappingers Falls.The Town,therefore,does not
have ownership rights,nor does it have voting rights on the Commission's governing board. However,the Town
has committed to share in capital costs for plant improvements as determined by the Commission.
Part of the Commission's residual fund balance is allocated to the Town and is returnable to the Town at the
discretion of the Commission's board. The Town's residual fund balance receivable was$584,424 at December
31,2017.This amount is included in Deferred Outflows in the Statement of Net Position.
3. United Wayyinger Water District
In 2012,the Town entered into an agreement with the City of New York for the construction of a water supply
and distribution system. The first phase of the project is for the extension of the water main from the United
Wappinger Water District to the NYC Shaft 6 site on River Road, This phase was completed and placed in service
during 2014. The second phase of the project is for a water main extension of the NYC DEP parcel to the Chelsea
Hamlet area. This phase is expected to be completed in 2018. The City has agreed to pay for all eligible costs
not to exceed$11,000,000, and the Town is responsible for all costs over$11,000,000. The construction costs
incurred under this project totaled$8,552,219 as of December 31,2017.
4. Authorized Debt
As of December 31,2017,the Town has authorized,but not issued,the following new debt:
Authorization Authorized Un-issued
PURPOSE Date Amount Amount
Carnwath Famis Improvements 06/23/08 $ 4,000,000 $2,790,000
United Wappinger WaterDistrict 04/22/13 4,040,000 419,000
TOTALS $ 8,040,000 $3,209,000
NOTE J—Municipal Landfills
1. Castle Point Landfill
The Town has voluntarily entered into a Consent Order with the New York State Department of Environmental
Conservation to close,cap and monitor the landfill at Castle Point.The closing and capping project was completed
in 1999. The costs of monitoring, which could be required for up to thirty years after closure, are currently
estimated to amount to$48,653 through 2021.The Town has recorded the long term liability of$44,230 and short
term liability of$4,423 in the Statement of Net Position. The costs of both closure and post closure monitoring
are ordinarily recognized over the expected useful life of the landfill. However, since the landfill has stopped
accepting refuse and is now closed,any additional costs over the estimate are being recognized as incurred. The
Town incurred$4,423 in monitoring costs during 2017. The future costs may be higher due to inflation,changes
in technology or subsequent changes in regulations.
37
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE J—Municipal Landfills(Continued)
2. Poughkeepsie-Wappingers-LaGrange Joint Landfill
The Town shares in the monitoring costs of a closed landfill, the Poughkeepsie-Wappinger-LaGrange Joint
Landfill. This joint activity includes the City and Town of Poughkeepsie,New York,the Village of Wappingers
Falls,New York,the Town of LaGrange,New York and the Town of Wappinger,New York. All costs associated
with monitoring are recognized as incurred, The Town's share of monitoring costs,for the year ended December
31,2017,amounted to$1,923.
The following is a summary of unaudited financial information at December 31, 2017,which is included in the
separate financial statements available from the Joint Landfill Board of Governors,Town of Poughkeepsie,One
Overocker Road,Poughkeepsie,New York, 12603:
Total Assets $ 43,492
Total Liabilities $To tat Fund Balance $ 43,492
Total Revenues $ 40,006
Total Expenditures $ 23,766
During 2002,violations were documented at the landfill and in 2003 an Order of Consent was issued through the
New York State Department of Environmental Conservation to remediate Environmental Conservation Law and
New York Codes,Rules and Regulations violations. To comply with this order the municipalities need to perform
final closure of the landfill under current regulations by December 31,2005, and perform post closure care and
monitoring for a minimum of thirty years thereafter. The estimated cost of final closure was$10,000,000. All
costs were borne proportionately by each municipality: the Town of Wappinger's share was 14,1728% or
$1,417,280. The Town issued $1,425,368 in bond anticipation notes to finance its share. The notes were
permanently financed as part of the 2009 public improvement serial bonds issuance and a portion of the bonds
was refunded in 2016. The outstanding debt as of December 31,2017 amounted to $548,882. Remaining post
closure and monitoring costs,which commenced in 2007 and continue for 30 years, are estimated to amount to
$654,700 as of December 31,2017,with the Town's share being$92,789.The Town has recorded the long term
liability of$89,572 and short terni liability of$3,21.7 in the Statement of Net Position.
NOTE K-Leases
The Town is committed under various leases for office equipment and communication equipment. For accounting
purposes,these leases can be considered either operating or capital leases. Operating lease expenditures amounted
to$32,381,and there were no capital lease expenditures for the year ended December 31,2017, At December 3 1,
2017,the approximate annual lease commitments,subject to appropriation of funds,were as follows:
YEAR ENDING OPERATING
DECEMBER 31, LEASES
2018 $ 34,520
2019 35,595
2020 34,484
2021 27,439
2022 23,088
Thereafter 30,784
Total minimum lease payments $ 185,910
38
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE L—Rental Income
The Town has agreements with various organizations for the rental of the Town's emergency services building and
for the rental of land and antenna space. Rental income totaled $185,487 for the year ended December 31, 2017.
Minimum future rental income is as follows:
YEAR ENDING RENTAL
DECEMBER 31, INCOME
2018 $ 151,885
2019 142,410
2020 116,261
2021 111,000
2022 46,250
Total minimum rental income $ 567,806
NOTE M—Tax Abatement
The Town has two real property tax abatements that provide for a 25 and 50% exemption for 2017 based on the
original payment in lieu of tax agreement. The purpose of the abatement was to cover the construction of a new
commercial retail store. Details related to the abatement for 2017 are as shown below:
Taxable
Start Assessed Tax Tax PILOT Taxes
Date Agreement Value Rate Value Received Abated
12/1/2010 Adams-WappingerLLC $7,000,000 3.94 $27,580 $22,064 $5,516
9/28/2016 Jalcli,LLC 9,200,000 3.94 36,248 18,124 18,124
NOTE N—Deferred inflows and Deferred Outflows of Resources
The following schedule details the deferred inflows and deferred outflows of resources as of December 31,2017.
DEFERRED DEFERRED
DESCRIPTION OUTFLOWS INFLOWS
Deferred Loss on Refunding $ 499,345 $ -
Deferred Bond Premium - 1,105,274
Participant Share Due FromTri-Municipal Sewer Commission 584,424 -
NYS Employee Retirement System 1,009,708 138,429
Other - 15,746
TOTALS $ 2,093,477 $ 1,259,449
39
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE O—Subsequent Events
In April 2018,the Town authorized the issuance of$621,400 in serial bonds to pay the cost of extending the water
district to the Tall Trees Water District.
In June 2018, the Town issued an $860,000 Serial Bond, Series A. Of which, $600,000 will be used for the
reconstruction of various Town roads and $260,000 for the improvement of the Midpoint Sewer District
In October 2018, the Town issued a $2,525,000 Serial Bond, Series B. Of which, $300,000 will be used for the
extension of the Tall Trees Water District to the Wappinger United Water District,$625,000 will be used for Highway
Equipment purchases and$1,600,000 will go toward the reconstruction of various Town roads for 2018 and 2019.
NOTE P—New Reaortine Standards
GASB has issued Statement 74,Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans,
which improves the usefulness of information about postemployment benefits other than pensions included in the
general purpose external financial reports of state and local government OPEB plans for making decisions and
assessing accountability,The Town determined that the new standard did not have a significant impact on its financial
reporting.
GASB has issued Statement 75, Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions, improves accounting and financial reporting by state and local governments for postemployment benefits
other than pensions. It also improves the information provided by state and local governmental employers about
support for OPEB that is provided by other entities. The Town is required to implement this standard for the year
ending December 31, 2018. The implementation of this standard is expected to have a substantive effect on the
Town's net position,
In November 2016, GASB issued Statement No. 83, Certain Asset Retirement Obligations. GASB 83 addresses
accounting and financial reporting for certain asset retirement obligations(AROs).An ARO is a legally enforceable
liability associated with the retirement of a tangible capital asset.A government that has legal obligations to perform
future asset retirement activities related to its tangible capital assets should recognize a liability based on the guidance
in this Statement. The requirements of GASB 83 are effective for reporting periods beginning after June 15, 2018.
The Town has not evaluated the effect of GASB 83 on its financial statements.
In January of 2017, GASB issued Statement No. 84,Fiduciary Activities. The objective of Statement No. 84 is to
improve guidance regarding the identification of fiduciary activities for accounting and financial reporting purposes
and how those activities should be reported. Statement No. 84 establishes criteria for identifying fiduciary activities
of all state and local governments. The focus of the criteria generally is on(1)whether a government is controlling
the assets of the fiduciary activity and(2)the beneficiaries with whom a fiduciary relationship exists.Separate criteria
are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary
activities.The Town is required to implement this standard for the year ended December 3.1,2019,
In March 2017, GASB issued Statement 85, Omnibus 2017. This Statement addresses a variety of topics including
issues related to blending component units,goodwill,fair value measurement and application,and postemployment
benefits(pensions and other postemployment benefits[OPEB]). The Town is required to implement this standard for
the year ending December 31,2018. The implementation of this standard is not expected to have a substantive effect
on the Town's net position.
40
TOWN OF WAPPINGER,NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31,2017
NOTE P—New RenortinQ Standards(Continued)
In June 2017, GASB issued Statement 87,Leases. The objective of this Statement is to better meet the information
needs of financial statement users by improving accounting and financial reporting for leases by governments, This
Statement increases the usefulness of governments'financial statements by requiring recognition of certain lease assets
and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or
outflows of resources based on the payment provisions of the contract. It establishes a single model for lease
accounting based on the foundational principle that leases are financings of the right to use an underlying asset,Under
this Statement,a lessee is required to recognize a lease liability and an intangible right-to-use lease asset,and a lessor
is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and
consistency of information about governments' leasing activities, GASB 87 is effective for fiscal year 2020. The
Town has not evaluated the effect of GASB 87 on its financial statements.
In March 2018, GASB issued Statement 88, Certain Disclosures Related to Debt, including Direct Borrowings and
Direct Placements. The primary objective of this Statement is to improve the information that is disclosed in notes to
government financial statements related to debt, including direct borrowings and direct placements. It also clarifies
which liabilities governments should include when disclosing information related to debt.This Statement requires that
additional essential information related to debt be disclosed in notes to financial statements,including unused lines of
credit;assets pledged as collateral for the debt;and terms specified in debt agreements related to significant events of
default with finance-related consequences, significant termination events with finance-related consequences, and
significant subjective acceleration clauses. GASB 88 is effective for fiscal year 2019, The Town has not evaluated
the effect of GASB 88 on its financial statements,
GASB has also issued Statements 85, 89, and 90,none of which are expected to have any substantive effects on the
Town's net position.
41
REQUIRED SUPPLEMENTARY INFORMATION
TOWN OF WAPPINGER,NEW YORK
BUDGETARY COMPARISON SCHEDULES
DECEMBER 31,2017
GENERAL FUND-TOWN-WIDE
VARIANCE
ORIGINAL FINAL FAVORABLE
BUDGET BUDGET' ACTUAL (UNFAVORABLE)
REVENUES
Real property taxes $ 2,781;185 $ 2,781,185 $ 2781,185 $
Real property tax items 68,000 68,000 112,409 44,409
Non property taxitems - - - -
Departmental income 125,500 125,500 147,576 22,076
Use of money and property 183,700 183,700 191,076 7,376
Licenses and permits 5,100 5,100 5,162 62
Fines and forfeitures 275,250 275,250 418,181 142,931
Sale of property and compensation]or loss - - 13,102 13,102
Miscellaneous local sources - - 23,407 23,407
State aid 716,900 716,900 791,169 74,269
Total revenues 4,155,635 4,155,635 4,483,267 327,632
EXPENDITURES AND ENCUMBRANCES
General government support 1,906,419 1,906,419 1,816,186 90,233
Public safety 35,882 35,882 31,015 4,867
Health 5,000 5,000 10,469 (5,469)
Transportation 184,567 184,567 154,241 30,326
Economic assistance&opportunity 650 650 650 -
Culture and recreation 583,153 583,153 578,833 4,320
Home and community service 217,000 217,000 199,048 17,952
Fnrloyee benefits 759,894 759,894 712,557 47,337
Debt service 463,070 463,070 430,070 33,000
Total expenditures and encumbrances 4,155,635 4,155,635 3,933,069 222,566
Excess (deficiency)of revenues over(under)
expenditures and encumbrances - - 550,198 550,198
Other financing sources (uses):
Operating transfers in - - - -
Operating transfers out - (1,871,221) (1,899,772) (28,551)
Total other financing sources - _ (1,871,221) (1,899,772) (28,551)
Excess (deficiency)of revenues and other sources
over(under)expenditures,other uses and encumbrances $ - $ (1,871,221) $ (1,349,574) $ 521,647
Explanation of differences between budgetary and GAAP basis
Excess ofrevenues over/(under)expenditures-budgetary basis $ (1,349,574)
Excess of revenues over expenditures pertaining to recreation funds 23,418
Excess of revenues overl(under)expenditures -GAAP basis $ (1,326,156)
42
TOWN OF WAPPINGER,NEW YORK
BUDGETARY COMPARISON SCHEDULES
DECEMBER 31,2017
GENERAL FUND-PART-TOWN
VARIANCE
ORIGINAL FINAL FAVORABLE
BUDGET' BUDGET ACTUAL (UNFAVORABLE)
REVENUES
Real property taxes
Real property tax items - - - -
Non property tax items 1,099,586 1,152,586 1,575,223 422,637
Departmental income 127,000 127,{x}0 146,563 19,563
Use of money and property 800 800 4,116 3,31.6
Licenses and permits 260,000 260,000 382,630 122,630
Fines and forfeitures - - - -
Sale of property and compensation for loss - - 650 650
Miscellaneous local sources - - -
State aid - - -
Total revenues 1,487,386 1,540,386 2,109,182 568,796
EXPENDITURES AND ENCUMBRANCES
General government support 186,500 241,500 137,003 104,497
Public safety 538,433 536,433 307,090 229,343
Health - - - -
Transportation 38,000 38,000 43,053 (5,053)
Economic assistance&opportunity 4,000 4,000 3,547 453
Culture and recreation 81,465 81,465 71,925 9,540
Home and community service 227,022 227,022 159,981 67,041
Fanployee benefits 270,563 270,563 222,508 48,055
Debt service 141,403 141,403 141,403 -
Total expenditures and encumbrances 1,487,386 1,540,386 1,086,510 453,876
Excess (deficiency)of revenues over(under)
expenditures and encumbrances - - 1,022,672 1,022,672
Other financing sources (uses):
Operating transfers in - - - -
Operating transfers out - - - -
Total other financing sources - - - -
Excess (deficiency)of revenues and other sources
over(under)expenditures,other uses and e n cumbrances $ - $ - $ 1,022,672 $ 1,022,672
43
TOWN OF WAPPINGER,NEW YORK
BUDGETARY COMPARISON SCHEDULES
DECEMBER 31,2017
HIGHWAY FUND
VARIANCE
ORIGINAL FINAL FAVORABLE
BUDGET BUDGET ACTUAL (UNFAVORABLE)
REVENUES
Real property taxes $ 3,199,421 $ 3,199,421 $ 3,199,421 $ -
Real property tax items - - - -
Non property tax items 263,414 263,414 259,721 (3,693)
Departmental income - - - -
Use of money and property 1,000 1,000 2,956 1,956
Licenses and permits - - 5,700 5,700
Fines and forfeitures - - - -
Sale of property and compensation for loss - - - -
Miscellaneous local sources - - 509 509
State aid 220,000 220,000 278,207 58,207
Total revenues 3,683,835 3,683,835 3,746,514 62,679
EXPENDITURES AND ENCUMBRANCES
General government support 167,500 167,500 106,482 61,018
Public safety - - - -
Health - - - -
Transportation 2,058,515 2,058,515 2,290,142 (236,627)
Economic assistance&opportunity - - - -
Culture and recreation - - - -
Home and community service - - - -
Employee benefits 912,562 912,562 784,693 127,869
Debt service 545,258 545,258 515,258 30,000
Total expenditures and encumbrances 3,683,835 3,683,835 3,696,575 (12,740)
Excess(deficiency)of revenues over(under)
expenditures and encumbrances - - 49,939 49,939
Other financing sources(uses):
Operating transfers in - - - -
Operating transfers out - - - -
Total other financing sources - - - -
Excess (deficiency)of revenues and other sources
over(under)expenditures,other uses and encumbrances $ - $ - $ 49,939 $ 49,939
44
TOWN OF WAPPINGER,NEW YORK
BUDGETARY COMPARISON SCHEDULES
DECEMBER 31,2017
WATER FUND
VARIANCE
ORIGINAL FINAL FAVORABLE
BUDGET BUDCET ACTUAL (UNFAVORABLE)
REVE14UES
Real property taxes $ 863,787 $ 863,787 $ 863,787 $ -
Real property tax items - - - -
Non property taxitems - - - -
Departmental income 1,350,680 1,350,680 1,323,010 (27,670)
Use of money and property 716 716 4,015 3,299
Licenses and permits - - - -
Fines and forfeitures - - - -
Sale of property and compensation fbrloss - - 13,460 13,460
Miscellaneous local sources - 11,074 11,074
State aid - - - -
Total revenues 2,215,183 2,215,183 2,215,346 163
EXPENDITURES AND ENCUMBRANCES
General government support 110,355 110,355 57,046 53,309
Public safety - - -
Health - - - -
Transportation - - - -
Economic assistance&opportunity - - - -
Culture and recreation - - - -
11ome and community service 1,263,950 1,263,950 1,255,664 8,286
Employee benefits 6,550 6,550 5,348 1,202
Debt service 834,328 834,328 834,328 -
Total expenditures and encumbrances 2,215,183 2,215,183 2,152,386 62,797
Excess (deficiency)of revenues over(under)
expenditures and encumbrances - - 62,960 62,960
Other financing sources(uses):
Operating transfers in - - - -
Operating transfers out - - (36,820) (36,820)
Total other financing sources - - (36,820) (36,820)
Excess (deficiency)of revenues and other sources
over(under)expenditures,other uses and encumbrances $ - $ - $ 26,140 $ 26,140
45
TOWN OF WAPPINGER,NEW YORK
BUDGETARY COMPARISON SCHEDULES
DECEMBER 31,2017
SEWER FUND
VARIANCE
ORIGINAL FINAL FAVORABLE
BUDGET BUDGET' ACTUAL (UNFAVORABLE)
REVENUES
Real property taxes $ 819,122 $ 819,122 $ 819,122 $ -
Real property taxitems - - 2,852 2,852
Non property tax items - - - -
Departmental income 2,133,903 2,133,903 1,984,829 (149,074)
Use of money and property 67,059 67,059 107,684 40,625
Licenses and permits - - - -
Fines and forfeitures - - - -
Sale of property and compensation for loss - - - -
Miscellaneous local sources - - - -
State aid - - -
Total revenues 3,020,084 3,020,084 2,914,487 (105,597)
EXPENDITURES AND INCUMBRANCES
General government support 91,397 91,397 72,487 18,910
Public safety - - - -
Health - - - -
Transportation - - - -
Economic assistance&opportunity - - - -
Culture and recreation - - - -
Home and community service 2,081,503 2,081,503 2,029,129 52,374
Fxnployee benefits 3,190 3,190 2,282 908
Debt service 843,994 843,994 843,992 2
Total expenditures and encumbrances 3,020.084 3,020,084 2,947,890 72,194
Excess (deficiency)of revenues over(under)
expenditures and encumbrances - - (33,403) (33,403)
Other financing sources (uses):
Operating transfers in 14,590 14,590 88,851. 74,261
Operating transfers out (14,590) (14,590) (265,033) (250,443)
Total other financing sources - - (176,182) (176,182)
Excess (deficiency)of revenues and other sources
over(under)expenditures,other uses and encumbrances $ - $ - $(209,585) $ (209,585)
46
TOWN OF WAPPING ER,NEW YORK
OTHER POSTEMPLOYMENT BENEFITS
SCHEDULE OF FUNDING PROGRESS
DECEMBER 31,2017
Unfunded UAL as a
Actuarial Actuarial Accrued Percentage
Actuarial Value of Accrued liability Funded Covered of Covered
Valuation Assets Liability (UAL) Ratio Payroll Payroll
Year Ended Date (a) (b) (b-a) (alb) (c) ((b-a)/c)
12/31/2017 12/31/2016 $ - $ 7,495,503 $ 7,495,503 0.00/. $ 3,137,416 238.91%
121311201.6 1213.1/2016 $ - $ 8,551,1.07 $ 8,551,107 0.0% $ 3,282,463 260.51%
12/31/2015 12/31/2013 $ - $ 6,114,097 $ 6,114,097 0.0% $ 2,850,368 214.500/.
47
TOWN OF WAPPINCER,NEW YORK
SCHEDULE OF PROPORTIONATE SHARE OF NET PENSION LIABILITY
DECEMBER 31,2017
NY,SLRS Pension Plan
Last 1014scalYears*
March 31,2017 March 31,2016 March 31,2015
Town's proportion of the net pension liability(asset) 0.0087792% 0.0091834% 0.0089152%
Town's proportionate share of the net pension liability
(asset) $ 824,911 $ 1.,473,969 $ 301,177
Town's covered-employee payroll $ 3,137,416 $ 3,282,463 $ 2,850,368
Town's proportionate share of the net pension liability
(asset)as a percentage of its covered-employee payroll 26.29% 44.90% 10.57%
Plan fiduciary net position as a percentage of the total
pension liability 94.70% 90.70% 97.90%
*The amounts presented for each discal year were determined as of the System's measurement date.
This schedule is presented to illustrate the requirement to show information for 10 years.
However,until,a full 10-year trend is compiled,the Town will present
information lbr those years forwhieh infornnation is available.
48
TOWN OF WAPPINGER,NEW YORK
SCHEDULE OF EMPLOYER CONTRIBUTIONS
DECEMBER 31,2017
NYSLRS Pension Plan
last 10 Fiscal Years*
March 31,2017 March 31,2016 March 31,2015
i
Contractually required contribution $ 420,822 $ 504,348 $ 497,076
Contributions in relation to the contractually
required contribution 420,822 504,348 497,076
Contribution deficiency(excess) $ - $ - $
Town's covered-employee payroll $ 3,137,416 $ 3,282,463 $ 2,850,368
Contributions as a percentage of covered-employee
payroll 13.41% 15.36% 17,44%
*The amounts presented for each fiscal year were determined as of the System's measurement date.
This schedule.is presented to illustrate the requirement to show information for 10 years.
However,until a full 10-yeartrend is compiled,the Town will present
information forthose years for which information is available.
49
i
OTHER SUPPLEMENTARY INFORMATION
TOWN OF WAPPINGER,NEW YORK
COMBINING BALANCE SHEET 1
NON-MAJOR GOVERNMENTAL FUNDS
DECEMBER 31,2017
TOTAL
SPECIAL NON-MAJOR
LIGHT AMBULANCE GRANT GOVERNMENTAL
FUND FUND FUND FUNDS
ASSETS
Cash and cash equivalents $ 40,817 $ 121,929 $ - $ 162,746
Due from other fiends - - 6,006 6,006
Due from other governments - - 5.490 5,490
Total assets $ 40;817 $ 121,929 $ 11,496 $ 174,242
LIABILITIES AND FUND FRUITY
LIABILITIRS
Accounts payable $ 3,886 $ - ' $ - $ 3,886
Due to other funds - - 11,496 11,496
Total liabilities 3,886 - 11,496 15,382
FUND BALANCE
Assigned-Unappropriated 36,931 121,929 - 158,860
Unassigned - - - -
Total fund balance 36,931 121,929 - 158,860
Total liabilities
and fund balance $ 40,817 $ 121,929 $ 11,496 $ 174.242
50
TOWN OF WAPPINGER,NEW YORK
COMBINING SCHEDULE OF REVENUES,EXPENDITURES AND
CHANCES IN FUND BALANCES '
NON-MAJOR GOVERNMENTAL FUNDS
DECEMBER 31,2017
TOTAL
SPECIAL NON-MAJOR
LIGHT AMBULANCE GRANT GOVERME iTAL
FUND FUND FUND FUNDS
REVENUES
Property taxes $ 50,677 $ 395,000 $ - 445,677
Real property taxitems - 4,.145 - 4,145
Use ofmoney and property 66 282 - 348
Miscellaneous local sources - - 5,490 5,490
Total revenues 50,743 399,427 5,490 455,660
EXPENDITURES
Culture and recreation - - 11,496 11,496
Health - 403,551 - 403,551
Transportation 44,718 - - 44,718
Total expenditures 44,718 403,551 11,496 459,765
Excess (deficiency)of revenues
over expenditures 6,025 (4,124) (6,006) (4,105)
Other financing sources(uses):
Operating transfers in - - 6,006 6,006
Total other financing sources (uses) - - 6,006 6,006
Excess(deficiency)of revenue and other
sources over expenditures and other us( 6,025 (4,124) - 1,901
Fund Balance,December 31,2016 30,906 126,053 - 156,959
Fund Balance,December 31,2017 $ 36,931 $ 121,929 $ - $ 158,860
51
�
J PtBT
t. MITED LIA81LITY PARTN(RSHW
CERTIFIED PUBLIC ACCOUNTANTS BUSINESS DEVELOPMENT CONSULTANTS
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS.PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the Supervisor and
Members of the Town Board
Town of Wappinger,New York
20 Middlebush Road
Wappingers Falls,New York 12540
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 governmental activities,each major fund, and the aggregate
remaining fund information of the Town of Wappinger,New York,as of and for the year ended December 31,2017,
and the related notes to the financial statements, which collectively comprise the Town of Wappinger,New York's
basic financial statements and have issued our report thereon dated October 4,2018.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the Town of Wappinger, New York's internal control over
financial reporting (internal control)to determine the 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 Town of Wappinger,New York's internal control.Accordingly,we do not express an opinion
on the effectiveness of the Town of Wappinger,New York'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 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 the internal control over financial reporting 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. Given these limitations,during our audit we did not identify any deficiencies in internal control
that we consider to be material weaknesses.We did identify certain deficiencies in internal control, described in the
accompanying Schedule of Findings,Recommendations and Responses as Findings 1,2 and 3 that we consider to be
significant deficiencies.
rbtapaaxom
11 Racquet Road 2676 South Band,Sukte 141 P.O.sox 209
Newburgh,NY 12550 Pouphkeepslo,NY 12601 31 Sullivan Street
T.(4 45)56M000 Tt(00)40.5510 Wurtsbo ra,NY 11790
Ft(645)W-9226 F.(6451)465.5147 T.(a45)666-56.54
Ft(045)066-2,764
52
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Town of Wappinger,New York's financial statements
are free of material misstatement,we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance 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
instances of noncompliance or other matters that are required to be reported under Government Auditing Standards
and which are described in the accompanying Schedule of Findings,Recommendations and Responses as Finding 4.
Town of Wappinger,New York's Response to Findings
Town of Wappinger,New York's response to the findings identified in our audit is described in the accompanying
schedule of findings,recommendations and responses. Town of Wappinger,New York's response was not subjected
to the auditing procedures applied in the audit of the financial statements and,accordingly,we express no opinion on
it.
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 Town of Wappinger,New York's
internal control or on compliance.This report is an integral part of an audit performed in accordance with Government
AuditingStandardv in considering the Town of Wappinger,New York's internal control and compliance.Accordingly,
this communication is not suitable for any other purpose.
BT(T ,4s, LLP
Newburgh,New York
October 4,2418
53
TOWN OF WAPPINGER,NEW YORK
SCHEDULE OF FINDINGS,RECOMMENDATIONS AND RESPONSES
FOR THE YEAR.ENDED DECEMBER 31,2017
SECTION I-SIGNIFICANT DEFICIENCIES:
PRIOR YEAR FINDINGS-CONTINUING-
Finding 1—Escrow Recordkee in
Condition: The Town has applied considerable effort in the reconciliation of applicant escrow
subsidiary ledgers to the Town's general ledger balances; however, material differences
continue to exist,the amounts of which change from year to year, Such changes indicate
an unreliable reconciliation methodology. Our examination of the escrow reconciliation.
revealed the following;
• As of December 31,2017,the escrow subsidiary ledgers exceeded the general ledger
liability balances by$150,126.
• Comments related to escrows have been made since 1993.
Criteria: Escrow liabilities should equal escrow cash. The escrow liability subsidiary ledger should
agree to the total escrow liability on the Town's accounting system.
Cause: The Town collects escrow funds to ensure that costs incurred by the Town,while projects
or subdivisions are being considered by the Planning Board, are borne by the applicants.
In the past,there existed a lack of communication between the Planning Department and
the Accounting Department regarding the nature of fees and expenses charged to individual
escrows. Individual schedules were not always updated and invoices were coded
incorrectly. Reconciliations between the Planning Department and the Accounting
Department were not performed regularly.As a result,these errors were not caught on a
timely basis.
Effect: The Town is responsible for payment of fees that should be taken from escrow accounts.
If not reconciled timely,the Town may not be able to recover these fees from the rightful
applicant. The Town could be liable for reimbursing the cash held for escrows in the
amount of$150,126.
Recommendation: The analysis of Escrow schedules should continue to be completed on a monthly basis,
comparing department receipt records and charges posted to individual escrow schedules to
general ledger transactions. Names of escrows should be consistent,such as code and name
of property, to avoid confusion between department documentation and general ledger
transactions.
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TOWN OF WAPPINGER,NEW YORK
SCHEDULE OF FINDINGS,RECOMMENDATIONS AND RESPONSES(CONTINUED)
FOR THE YEAR ENDED DECEMBER 31.,2017
SECTION I-SIGNIFICANT DEFICIENCIES(CONTINUED).-
PRIOR
CONTINUED):PRIOR YEAR FINDINGS—CONTINUING(CONTINUED):
Finding 2-Escrow Funds Negative Balances
Condition: Payments have been made in excess of escrow amounts collected resulting in excess
payments being made on behalf of individual project owners/developers. As of December
31, 2017, 146 of a total of 375 escrow accounts had debit (negative) balances totaling
$161,189,of which 105,with balances of$105,819,are deemed"old".
#Positive $Positive #Deficit $Deficit
Year Accounts Balances Accounts Balances
2017 229 $ 604,433 146 $ 161,189
2016 226 606,519 134 135,141
2015 199 553,456 135 134,703
2014 211 648,095 138 123,914
2013 194 656,289 136 138,827
Escrow balances labeled"old"or"inactive"in the Town's records totaled as follows:
#of $of
Year Accounts Deficits
2017 105 $ 105,819
201.6 101 104,566
2015 101 104,566
2014 101 104,566
2013 104 107,440
Criteria: The Town's policy is to collect escrow funds in advance of consultants' billings such that
the Town has the funds to make payments. We note that the Town Board authorized
legislation during 2002 and 2006 which provided for policies and procedures to ensure that
the Town does not subsidize applicant review costs.
Cause: As described above, both the Planning Department and the Accounting Department
maintain records for each project/applicant so that balances can be monitored;however,in
numerous cases disbursements exceeding the escrow collected were processed.
Effect: The Town is responsible for payment of fees that should be taken from escrow accounts.
If not reconciled timely,the Town may not be able to recover these fees from the rightful
applicant.Debit(negative)balances continue to occur and/or increase.The Town could be
liable for reimbursing cash held for escrows up to $161,189. When combined with the
amount noted in Finding 1, the escrow balances appear to be underfunded by a total of
$311,315.
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TOWN OF WAPPINGER,NEW YORK
SCHEDULE OF FINDINGS,RECOMMENDATIONS AND RESPONSES(CONTINUED)
FORT.:H:E YEAR ENDED DECEMBER 31,2017
SECTION I-SIGNIFICANT DEFICIENCIES(CONTINUED):
PRIOR YEAR FINDINGS—CONTINUING (CONTINUED):
Findin 2-Escrow Funds Ne ative Balances Continued
Recommendation: We recommend that amounts should be not returned to an applicant until a thorough review
of all transactions is made,including confirmation of escrow funds received and an analysis
of all disbursements made on that applicant's behalf. For"inactive"escrow balances, the
Town should review these balances by making inquiries of engineers and attorneys
regarding their fees related to these applicants, and confirm that all appropriate
disbursements have been charged to the appropriate applicants, Along with the
reconciliations mentioned above,we recommend that the Town make the confirmation and
collection of these escrow balances a priority by reviewing the pertinent documentation
and determining a course of action for collection of each account.
CURRENT YEAR FINDING:
Finding 3—Other Postemployment Benefits Calculation
Condition: According to Governmental Accounting Standards, the Town is required to have an
actuarial calculation of actual and projected benefits for their current employees and
retirees.Reviewing the census data on a periodic basis provides the Town with support for
the calculation.The current Other Postemployment Benefit liability at December 31,2017
is in excess of $3,000,000. Therefore, the accuracy of the underlying census data is
material,Audit testing revealed that the census data provided to the actuary was inaccurate
and required significant revision.
Criteria: The Town has a responsibility as the employer to ensure that actuaries engaged to prepare
the calculation have an updated listing of all employees and the current benefits offered to
those employees in order to properly calculate the Town's liability for these benefits.
Cause: Prior to audit fieldwork,the Town had not properly updated the census data.
Effect: The Other Postemployment Benefits (OPER) liability on the government wide financial
statements was reduced by$1,057,463 after the census data was revised.
Recommendation: RBT recommends that the Town implement policies and procedures to ensure that its
census data is updated every year.
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TOWN OF WAPPINGER,NEW YORK
SCHEDULE OF FINDINGS,RECOMMENDATIONS AND RESPONSES(CONTINUED)
FOR THE YEAR ENDED DECEMBER 31,2017
SECTION Il—COMPLIANCE FINDINGS:
CURRENT YEAR FINDINGS:
Finding 4—Capital Pro.lects Deficit Fund Balance
Condition: As of December 31, 2017, the Town maintained deficit fund balances in certain Capital
Projects,as follows:
Deficit
Balance as of Net
Capital Projects: 12/31/17 BAN Effect (Deficit)/Surplus
Resurfacing Various Roads $ (278,069) $ 650,000 $ 371,931
W ildwood Sewer District (46,212) - (46,212)
Mid-Point Collection Systemh-nprovement (226,488) 280,000 53,512
Criteria: The Town should have appropriate net positive fund balances for all capital projects funds.
Cause:
Prior years' budgeting practices included over-estimating revenues and under-estimating
expenditures.
Effect: Future taxpayers will be funding past expenditures.
Recommendation: The Town should establish plans to provide for funding these deficits as well as improving
budgeting procedures to prevent deficits from occurring and accumulating in the future.
STATUS OF PRIOR YEAR FINDINGS:
Satisfied: Prior Year Finding 3—Capital Projects in Trust and Agency
Prior Year Finding 4—Payroll Testing
Prior Year Finding 5—Highway Department Testing
57
SUPERVISOR TOWN OF WAPPINGER TOWN BOARD
Dr.Riehard L.Thurston wifflarn H.Boalv
Angela Bettina
Executive Assistant Robert A,folinstou
Sandra Vacchio Michae1KU7MiCZ
20 MIDDLUMSH ROAD TOWN CLERK
WAPPIN6ERS FALLS.NY 12590
Joseph P.Paoloni
WWW.T0WN01'WAPP1NGER.US
(845)297-4158-Main HIGHWAY SUPERINTENDENT
(8451297-2744-Direct Vincent Bettina
(84512974558—rax Office of the Town Supervisor
December 10,2018
Responses to the Findings in the.Audited Financial Statements 2017
1. Escrow Record Keeping
As noted above, the bulk of the differences between escrow subsidiary ledgers and the general ledger are
historical, The Supervisor initiated in 2018 a comprehensive reconciliation effort among the various departments
and the consultant staff. Part of the solutions on which we are working is to ensure that the billings are booked
promptly into the, right escrow account by improving both the filing process and billing descriptions received
from our consultants. The Town Board may consider the possibility of writing off some of the very old balances
after this reconciliation effort.
'2. 'Escrow Funds Negative Balances
Deficit balances arise when project owners do not replenish their escrow accounts in a timely manner. It is our
longstanding policy to make payment only for professional work-done for which the escrow account balance is
positive even though we continue to record the bills as they come to us. Any bills for which the escrow account
is negative are placed on hold until the account is replenished. As part of our overall efforts to reconcile escrow
accounts,we are now focusing on ensuring that escrows in arrears will be replenished timely. If not,then future
work project work will be halted pending reconciliation. The Town Board will consider boosting the escrow
function by dedicating personnel for escrow reconciliations.
3. Other Postemployment Benefits Calculation
We note that the Government Accounting Standard Board does not mandate yearly valuation of OPEB benefits.
The Town OPEB data was restated and is up to date as of December 31, 2017. The restatement resulted in a
reduction in Net OPEB liability from$8,551,141 to $7,495,503. The next restatement will not be required until
December 31,2019.
4. Capital Projects Deficit Fund Balance
Deficit balances for the Resurfacing of Various Roads and Mid-Point Collection System Improvement is cosmetic
because financing through Bond Anticipation Notes does not lend to revenue recognition.Technically,these two
capital projects had surplus funds at year end and appropriate funding was provided to carry out the projects.
Sincerely,
Richard Thurston
Supervisor,Town of Wappmiger
58