HomeMy WebLinkAbout2023 AMD Audited Financial Statements (FINAL) Metropolitan District
Financial Statements
December 31, 2023
i
Arrowhead Metropolitan District
Financial Statements
December 31, 2023
Table of Contents
Page
INDEPENDENT AUDITOR'S REPORT A1 –A3
Management’s Discussion and Analysis B1 –B4
Government-wide Financial Statements:
Statement of Net Position C1
Statement of Activities C2
Fund Financial Statements:
Balance Sheet -Governmental Funds C3
Reconciliation of the Balance Sheet of Governmental Funds to the
Statement of Net Position C4
Statement of Revenues, Expenditures and Changes in
Fund Balances -Governmental Funds C5
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities C6
Notes to the Financial Statements D1 –D18
Required Supplementary Information:
Schedule of Revenues, Expenditures and Changes in
Fund Balance -Budget and Actual -Governmental Funds:
General Fund E1
Supplementary Information:
Schedule of Revenues, Expenditures and Changes in
Fund Balance -Budget and Actual -Governmental Funds:
Debt Service Fund F1
History of Assessed Valuation, Mill Levy and Property Taxes Collected F2
Schedule of Bonds Payable to Maturity F3
McMahan and Associates, l.l.c.
Certified Public Accountants and Consultants
Web Site: www.mcmahancpa.com
Chapel Square, Bldg C Main Office: (970) 845-8800
245 Chapel Place, Suite 300 Facsimile: (970) 845-8108
P.O. Box 5850, Avon, CO 81620 E-mail: mcmahan@mcmahancpa.com
Member: American Institute of Certified Public Accountants
Paul J. Backes, CPA, CGMA Avon: (970) 845-8800
Michael N. Jenkins, CA, CPA, CGMA Aspen: (970) 544-3996
Matthew D. Miller, CPA Frisco: (970) 668-3481
A1
M
&
A
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Arrowhead Metropolitan District
Edwards, Colorado
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities and each major
fund of Arrowhead Metropolitan District (the “District”), as of and for the year ended December 31, 2023,
and the related notes to the financial statements,which collectively comprise the District’s basic financial
statements as listed in the Table of Contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund of the District, as of
December 31, 2023 and the respective changes in financial position thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of
America (“U.S. GAAS”). Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report. We are required to be
independent of the District and to meet our other ethical responsibilities, in accordance with the relevant
ethical requirements relating to our audit. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
The District’s management is responsible for the preparation and fair presentation of the financial
statements in accordance with U.S. GAAP, and for the design, implementation, and maintenance of
internal control relevant to the preparation and fair presentation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or
events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as
a going concern for one year after the date that the financial statements are issued.
INDEPENDENT AUDITORS REPORT
To the Board of Directors
Arrowhead Metropolitan District
A2
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance
and therefore is not a guarantee that an audit conducted in accordance with U.S. GAAS will always detect
a material misstatement when it exists. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control. Misstatements are considered material
if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment
made by a reasonable user based on the financial statements.
In performing an audit in accordance with U.S. GAAS, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, and design and perform audit procedures responsive to those risks. Such
procedures include examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the District’s internal control. Accordingly, no such opinion is
expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate,
that raise substantial doubt about the District’s ability to continue as a going concern for a
reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit, significant audit findings, and certain internal control–related
matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s
Discussion and Analysis in Section B be presented to supplement the basic financial statements. Such
information is the responsibility of management and, 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.
The budgetary comparison information in section E is not a required part of the basic financial statements
but is supplementary information required by U.S. GAAP. The budgetary comparison information has
been subjected to the auditing procedures applied in the audit of the financial statements and certain
additional procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the financial statements or to the financial statements
themselves, and other additional procedures in accordance with U.S. GAAS. In our opinion, the
information is fairly stated in all material respects in relation to the financial statements as a whole.
INDEPENDENT AUDITORS REPORT
To the Board of Directors
Arrowhead Metropolitan District
A3
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the District’s financial statements as a whole. The individual fund budgetary comparison in
Section F is presented for purposes of additional analysis and are not a required part of the basic
financial statements.
The budgetary comparison found in Section F is the responsibility of management and was derived from
and relate directly to the underlying accounting and other records used to prepare the financial
statements. The information has been subjected to the auditing procedures applied in the audit of the
basic financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements themselves, and other additional procedures in accordance with
auditing standards generally accepted in the United States of America. In our opinion, the information is
fairly stated in all material respects in relation to the financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other information
comprises the summary of assessed valuation, mill levy, and property tax collections and schedule of
bond obligations, and interest requirements to maturity but does not include the basic financial statements
and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other
information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other
information and consider whether a material inconsistency exists between the other information and the
basic financial statements, or the other information otherwise appears to be materially misstated. If,
based on the work performed, we conclude that an uncorrected material misstatement of the other
information exists, we are required to describe it in our report.
McMahan and Associates, L.L.C.
Avon, Colorado
June 10, 2024
MANAGEMENT’S DISCUSSION AND ANALYSIS
ARROWHEAD METROPOLITAN DISTRICT
MANAGEMENT DISCUSSION AND ANALYSIS
December 31, 2023
- B1 -
This management’s discussion and analysis of the Arrowhead Metropolitan District’s financial statements
provides an overview of the District’s financial activities for the fiscal year ended December 31, 2023. The
intent of this discussion and analysis is to look at the District’s financial performance as a whole; it should
be read in conjunction with the basic financial statements and notes to enhance the reader’s understanding
of the District’s overall financial performance.
USING THE BASIC FINANCIAL STATEMENTS
This annual report consists of three parts – management’s discussion and analysis (this section), the basic
financial statements, and required supplementary information. The basic financial statements include two
types of information on the same statement that present different views of the District:
Government-wide financial statements that provide both long-term and short-term information
about the District’s overall financial status.
Fund financial statements that focus on individual parts of the District government, reporting the
District’s operations in more detail than the government-wide statements.
The financial statements also include notes that explain some of the information in the financial statements
and provide more detailed data. The statements are followed by a section of required supplementary
information that further explains and supports the information in the financial statements. Additional
supplemental information has also been included to enhance the reader’s understanding of the financial
statements.
Government-wide Statements
The government-wide statements consist of the Statement of Net position and the Statement of Activities.
These statements report information about the District as a whole and include all assets and liabilities using
the accrual basis of accounting, which is similar to the accounting used by most private-sector companies.
All of the current year’s revenues and expenses are taken into account regardless of when cash is received
or paid.
These two statements report the District’s net position and changes in them. The District’s net position–
the difference between assets, deferred outflows, liabilities and deferred inflows– is one way to measure
the District’s financial health, or financial position. Over time, increases or decreases in the District’s net
position is one indicator of whether its financial health is improving or deteriorating. Other non-financial
factors, however, such as changes in the District’s property tax base and the condition of the infrastructure,
are needed to assess the overall health of the District.
Fund Financial Statements
The fund financial statements provide more detailed information about the District’s funds, focusing on its
most significant funds – not the District as a whole. The District’s major governmental funds include the
General Fund and the Debt Service Fund. Unlike government-wide financial statements, the focus of the
fund financial statements is directed to specific activities of the District rather than the District as a whole.
Except for the General Fund, a specific fund is established to satisfy managerial control over resources or
to satisfy finance-related legal requirements established by external parties or governmental statutes or
regulations.
Governmental funds – The District’s activity is reported as a governmental fund, which focuses on how
money flows into and out of those funds and the balances left at year-end that are available for spending in
future periods. The funds are reported using an accounting method called modified accrual accounting,
ARROWHEAD METROPOLITAN DISTRICT
MANAGEMENT DISCUSSION AND ANALYSIS
December 31, 2023
- B2 -
which measures cash and all other financial assets that can readily be converted to cash. The governmental
fund financial statements provide a detailed short-term view of the District’s general government operations
and the basic services it provides. Governmental fund information helps to determine whether there are
more or fewer financial resources that can be spent in the near future to finance the District’s programs.
The relationship (or differences) between governmental activities (reported in the Statement of Net position
and the Statement of Activities) and governmental funds is provided in reconciliations following the fund
financial statements.
THE DISTRICT AS A WHOLE
Statement of Net Position
The perspective of the Statement of Net Position is of the District as a whole. Following is a summary of
the District’s net position for the fiscal years 2023 and 2022.
2023 2022
Assets and Deferred Outflows:
Current and Other Assets 5,909,825$ 5,370,916$
Capital Assets, Net 13,317,613 13,770,527
Deferred charge on refunding 250,085 310,422
Total Assets and Deferred Outflows 19,477,523 19,451,865
Liabilities:
Current Liabilities 72,651 77,751
Long-Term Obligations:
Due within One Year 911,277 890,716
Due in More Than One Year 7,011,845 7,923,122
Total Liabilities 7,995,773 8,891,589
Deferred Inflows:
Unavailable Property Taxes 1,586,037 1,775,108
Deferred Gain of Refunding 48,755 59,699
Total Deferred Inflows of Revenue 1,634,792 1,834,807
Net Position:
Net Investment in Capital Assets, net of related debt5,595,821 5,346,250
Restricted for Emergencies 64,290 59,110
Restricted for Debt Service 43,626 43,626
Unrestricted 4,143,221 3,276,483
Total Net Position 9,846,958$ 8,725,469$
ARROWHEAD METROPOLITAN DISTRICT
MANAGEMENT DISCUSSION AND ANALYSIS
December 31, 2023
- B3 -
The District’s primary assets are the capital assets which have been financed with bonds. Net position of
the District increased by $1,121,489 in 2023, due to increased revenue from sales and specific ownership
taxes and repayment of the District’s bond debt more rapidly than the acquired assets are being depreciated.
Statement of Activities
The perspective of the Statement of Activities is of the District as a whole. The Statement of Activities
reflects the cost of program services and the charges for services and sales, grants and contributions
offsetting the cost of the services. The following detail reflects the total cost of services supported by
program revenues and general property taxes, as well as other general revenues, resulting in the overall
change in net position for the fiscal years 2023 and 2022.
2023 2022
Revenues:
General Revenues:
Taxes 3,139,348$ 2,947,207$
Interest Income 166,623 61,710
Other Miscellaneous 4,298 20,273
Program Revenues:
Charges for Services 106,553 45,831
Grants 38,928
Total Revenues 3,455,750 3,075,021
Program Expenses:
General Government 168,753 162,862
Public Works 1,476,751 1,349,657
Transportation 437,290 301,142
Interest on Long-Term Debt 251,467 278,655
Total Expenses 2,334,261 2,092,316
Change in Net Position 1,121,489 982,705
Net position– beginning of year 8,725,469 7,742,764
Net position– end of year 9,846,958$ 8,725,469$
The District’s primary source of revenues is property taxes. The District implemented a 5.0% sales tax on
July 1, 2020 on sales of tangible personal property and short-term rentals of less than 30 days within
Arrowhead. These revenues are used to pay the cost of road operations, road safety and transportation as
well as to pay debt service related to these functions. The District operated at a surplus in both 2023 and
2022 and the operating surplus has been used to pay a portion of the principal on the District’s bond debt
as well as accelerate road maintenance and fund improvements.
THE DISTRICT’S FUNDS
The fund level financial statements focus on how services were financed in the short term as well as what
remains for future spending. The fund level financial statements are reported on the modified accrual basis
of accounting.
ARROWHEAD METROPOLITAN DISTRICT
MANAGEMENT DISCUSSION AND ANALYSIS
December 31, 2023
- B4 -
At the fund level, under the modified accrual basis of accounting, depreciable assets and their related
depreciation expense are not reflected as they are not a current period financial resource or use. In addition,
at the fund level, inflows from operating loans are presented as a revenue item while outflows for capital
outlay and debt service payments are presented as an expenditure item, as these items represent current
period financial resources and uses.
The General Fund ending fund balance increased from $3,491,322 to $4,222,756 during the fiscal year
ended December 31, 2023. This is mainly due to operating at a surplus for the year resulting from higher-
than-expected sales tax receipts and the District not needing to spend funds budgeted for contingencies.
The District is using the surplus to fund construction of a roundabout at the main entrance of the District to
provide safe crossing of Highway 6.
GENERAL FUND BUDGETARY HIGHLIGHTS
The General Fund budget comparison is reflected on page E1 of this report. It shows that during 2023 the
District earned $333,245 more in revenues than budgeted, mostly due to more sales tax being collected as
compared to budgeted. The District did not expend all the funds budgeted for operating and capital
contingencies, capital expenditures, and transportation due to efficient staffing and delayed purchase of
equipment. Overall the District spent $214,318 less than was budgeted in the General Fund.
DEBT SERVICE FUND BUDGETARY HIGHLIGHTS
The Debt Service Fund budget comparison is reflected on page F1 of this report. The comparison shows
no significant budget variances in the Debt Service Fund.
CAPITAL ASSETS
At the beginning of 2023, the District had a total of $23,270,601 invested in capital assets. During 2023,
the District invested an additional $74,949 net in capital assets before accumulated depreciation, bringing
the total to $23,345,550. The detailed capital asset categories can be seen in Note III (B), Capital Assets
on page D11 of this report.
DEBT ADMINISTRATION
The District paid down the outstanding balance of its long-term debt by $845,000 during 2023 resulting in
an outstanding balance of $7,830,000 on December 31, 2023. See Note 4III (C) – Long-term Debt on page
D12 through D14 of this report for a detail of the terms and the annual requirements to amortize the
District’s long-term debt.
CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT
This financial report is designed to provide our residents, customers, taxpayers, investors, and creditors
with a general overview of the District’s finances and to show the District’s accountability for the money
it receives. If you have any questions regarding this report or need additional financial information, please
contact the Arrowhead Metropolitan District Manager, c/o Marchetti & Weaver, LLC., 28 2 nd St Unit 213,
Edwards, CO 81632, Telephone (970) 926-6060, email: admin@mwcpaa.com.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
Assets:
Cash and cash equivalents 4,105,497
Am ounts due from Eagle County 7,433
Property taxes receivable 1,586,037
Sales tax receivable 177,592
Other receivables 1,899
Prepaid expenses 31,367
Capital assets, net 13,317,613
Total Assets 19,227,438
Deferred Outflow of Resources:
Deferred charge on refunding 250,085
Total Deferred Outflow of Resources 250,085
Liabilities:
Current liabilities due in less than one year:
Accounts payable 57,403
Accrued expenses 15,248
Bonds payable 865,000
Leases payable 46,277
Non-current liabilities due in excess of one year:
Bonds payable 6,965,000
Leases payable 46,845
Total Liabilities 7,995,773
Deferred Inflow of Resources:
Property tax revenue 1,586,037
Deferred gain on refunding 48,755
Total Deferred Inflow of Resources 1,634,792
Net Position:
Net investment in capital assets 5,595,821
Restricted for debt service 43,626
Restricted for emergencies 64,290
Unrestricted 4,143,221
Total Net Position 9,846,958
December 31, 2023
Statement of Net Position
Arrowhead Metropolitan District
The accompanying notes are an integral part of these financial statements.
C1
Net (Expense)
Revenue and Changes
in Net Position
Operating Capital
Charges for Grants and Grants and Net (Expense)
Expenses Services Contributions Contributions Revenue
Functions/Programs:
Governmental activities:
General government 168,753 - 38,928 - (129,825)
Public works 1,476,751 60,000 - - (1,416,751)
Transportation 437,290 46,553 - - (390,737)
Interest 251,467 - - - (251,467)
Total primary government 2,334,261 106,553 38,928 - (2,188,780)
General revenues:
Taxes:
Property tax 1,776,749
Specific ownership tax 101,795
Sales tax 1,260,804
Other income 4,298
Interest income 166,623
Total General Revenues 3,310,269
Change in Net Position 1,121,489
Net Position - Beginning 8,725,469
Net Position - Ending 9,846,958
Arrowhead Metropolitan District
Statement of Activities
For the Year Ended December 31, 2023
Program Revenues
The accompanying notes are an integral part of these financial statements.
C2
FUND FINANCIAL STATEMENTS
Total
Governmental
General Debt Service Funds
Assets:
Equity in pooled cash and investments 4,064,141 41,356 4,105,497
Amounts due from Eagle County 5,163 2,270 7,433
Property taxes receivable 538,078 1,047,959 1,586,037
Sales tax receivable 177,592 - 177,592
Other receivables 1,899 - 1,899
Prepaid expenses 31,367 - 31,367
Total Assets 4,818,240 1,091,585 5,909,825
Liabilities, Deferred Inflow of Resources,
Liabilities:
Accounts payable 57,403 - 57,403
Total Liabilities 57,403 - 57,403
Deferred Inflow of Resources:
Unavailable property tax revenue 538,078 1,047,959 1,586,037
Total Deferred Inflow of Resources 538,078 1,047,959 1,586,037
Fund Balances:
Nonspendable 31,367 - 31,367
Restricted for debt service - 43,626 43,626
Restricted for emergencies 64,290 - 64,290
Unassigned 4,127,102 - 4,127,102
Total Fund Balances 4,222,759 43,626 4,266,385
Total Liabilities, Deferred Inflow
of Resources, and Fund Balances 4,818,240 1,091,585 5,909,825
December 31, 2023
Governmental Funds
Balance Sheet
Ar rowhead Metropolitan District
The accompanying notes are an integral part of these financial statements.
C3
Governmental Funds Total Fund Balance 4,266,385
Capital assets used in governmental activities are not considered current
financial resources and, therefore, are not reported in the funds.
Details of these amounts are as follows:
Capital assets 23,161,550
Leased assets 184,000
Accumulated depreciation (9,935,937)
Accumulated amortization for leased assets (92,000)
13,317,613
Deferred outflows are not available for current period expenditures and
therefore, are not reported in the funds. This represents the District's
deferred charges on refunding.250,085
Long-term liabilities, including bonds payable and leases payable, are
not due and payable in the current period and, therefore, are not
reported in the funds. This is the amount of District long-term
liabilities. Details of these amounts are as follows:
Leases payable (93,122)
Bonds payable (7,830,000)
Accrued interest payable (15,248)
(7,938,370)
Deferred inflows are not available for current period revenues and
therefore, are not reported in the funds. This represents the District's
deferred gain on refunding.(48,755)
Net Position of Governmental Activities 9,846,958
Ar rowhead Metropolitan District
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position
December 31, 2023
The accompanying notes are an integral part of these financial statements.
C4
Total
Governmental
General Debt Service Funds
Revenues:
Property and specific ownership taxes 1,304,904 573,640 1,878,544
Sales tax 1,260,804 - 1,260,804
Interest 158,944 7,679 166,623
Charges for services 46,553 - 46,553
Lottery proceeds 2,014 - 2,014
Other income 101,212 - 101,212
Total Revenues 2,874,431 581,319 3,455,750
Expenditures:
General government 152,469 17,314 169,783
Public works 554,777 - 554,777
Transportation 398,002 - 398,002
Debt service
Principal - 845,000 845,000
Interest and fiscal charges - 202,687 202,687
Lease obligations 55,776 - 55,776
Capital outlay 498,289 - 498,289
Total Expenditures 1,659,313 1,065,001 2,724,314
Excess (Deficiency) of Revenues
over Expenditures 1,215,118 (483,682) 731,436
Other Financial Sources (Uses):
Transfers in (out)(483,682) 483,682 -
Total Other Financing Sources (Uses)(483,682) 483,682 -
Net Change in Fund Balances 731,436 - 731,436
Fund Balances - Beginning 3,491,323 43,626 3,534,949
Fund Balances - Ending 4,222,759 43,626 4,266,385
Ar rowhead Metropolitan District
Statement of Revenues, Expenditures
For the Year Ended December 31, 2023
Governmental Funds
and Changes in Fund Balances
The accompanying notes are an integral part of these financial statements.
C5
Net change in fund balances for total governmental funds 731,436
Governmental funds report capital outlays as expenditures. However, in the
Statement of Activities, the cost of the assets is allocated over their
estimated useful lives as depreciation expense. This is the net difference
between depreciation and capital additions during the year. Details of these
differences are as follows:
Capital additions 74,949
Depreciation expense (481,863)
Amortization expense (46,000)
(452,914)
The repayment of the principal of long-term debt consumes current financial
resources of governmental funds. This transaction, however, has no effect on
net position. Also, governmental funds report the effect of premiums,
discounts, and similar items when debt is first issued, whereas these amounts
are deferred and amortized in the Statement of Activities. This amount is the
net effect of these differences in the treatment of long-term debt and related
item s.
Principal repayments - Bonds payable 845,000
Principal repayments - Leases payable 45,716
Amortization of bond refunding gains 1,646
Amortization of bond refunding costs (51,038)
841,324
The change in accrued interest reported in the Statement of Activities does not
require the use of current financial resources and, therefore, is
not reported as an expenditure in governmental funds.1,643
Change in Net Position of Governmental Activities 1,121,489
Changes in Fund Balances of Governmental Funds to the
Reconciliation of the Statement of Revenues, Expenditures, and
Ar rowhead Metropolitan District
For the Year Ended December 31, 2023
Statement of Activities
The accompanying notes are an integral part of these financial statements.
C6
NOTES TO THE FINANCIAL STATEMENTS
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
D1
I.Summary of Significant Accounting Policies
Arrowhead Metro District (the “District”) was organized on November 17, 1981 as a quasi-
municipal corporation and is governed pursuant to provisions of the Colorado Special District Act.
The District’s service area is located in Eagle County, Colorado. The District was established to
be able to provide water, recreation, transportation, fire protection, roads, drainage, and television
services. Fire protection services are provided by the Eagle River Fire Protection District. Water
services are provided by the Upper Eagle Regional Water Authority.The District has no
employees and all operations and administrative functions are contracted.
The District’s financial statements are prepared in accordance with generally accepted
accounting principles (“GAAP”). The Governmental Accounting Standards Board (“GASB”) is
responsible for establishing GAAP for state and local governments through its pronouncements
(Statements and Interpretations). The more significant accounting policies established by GAAP
used by the District are discussed below.
A.Reporting Entity
The reporting entity consists of (a) the primary government; i.e., the District, and (b)
organizations for which the District is financially accountable. The District is considered
financially accountable for legally separate organizations if it is able to appoint a voting
majority of an organization's governing body and is either able to impose its will on that
organization or there is a potential for the organization to provide specific financial
benefits, to, or to impose specific financial burdens on, the District. Consideration is also
given to other organizations which are fiscally dependent; i.e., unable to adopt a budget,
levy taxes, or issue debt without approval by the District. Organizations for which the
nature and significance of their relationship with the District are such that exclusion would
cause the reporting entity's financial statements to be misleading or incomplete are also
included in the reporting entity.
Based on the criteria discussed above, the District is not financially accountable for any
other entity, nor is the District a component unit of any other government.
B.Government-wide and Fund Financial Statements
The District’s basic financial statements include both government-wide (reporting the
District as a whole) and fund financial statements (reporting the District’s major funds).
Both the government-wide and fund financial statements categorize primary activities as
governmental type.
1.Government-wide Financial Statements
In the government-wide Statement of Net Position, all balances are reported on a
full accrual, economic resource basis, which recognizes all long-term assets and
receivables as well as long-term debt and obligations.
The government-wide focus is on the sustainability of the District as an entity and
the change in the District’s net position resulting from the current year’s activities.
As a general rule, the effect of interfund activity has been eliminated from the
government-wide financial statements.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D2
I.Summary of Significant Accounting Policies (continued)
B.Government-wide and Fund Financial Statements (continued)
2.Fund Financial Statements
The financial transactions of the District 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. The fund focus is on current
available resources and budget compliance.
The District reports the following governmental funds:
The General Fund is the District’s primary operating fund. It accounts for all
financial resources of the District, except those required to be accounted for in
another fund.
The Debt Service Fund accounts for the resources accumulated and payments
made for principal and interest on long-term general obligation debt of the
governmental funds.
C.Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Measurement focus refers to whether financial statements measure changes in current
resources only (current financial focus) or changes in both current and long-term
resources (long-term economic focus). Basis of accounting refers to the point at which
revenues, expenditures, or expenses are recognized in the accounts and reported in the
financial statements. Financial statement presentation refers to classification of revenues
by source and expenses by function.
1.Long-term Economic Focus and Accrual Basis
Governmental activities in the government-wide financial statements use the
long-term economic focus and are presented on the accrual basis of accounting.
Revenues are recognized when earned and expenses are recognized when
incurred, regardless of the timing of the related cash flows.
2.Current Financial Focus and Modified Accrual Basis
The governmental fund financial statements use the current financial focus and
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 soon enough thereafter (60 days)to be used to pay liabilities of
the current period. Expenditures are generally recognized when the related
liability is incurred. The exception to this general rule is that principal and interest
on general long-term debt, if any, is recognized when due.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D3
I.Summary of Significant Accounting Policies (continued)
C.Measurement Focus, Basis of Accounting, and Financial Statement Presentation
(continued)
3.Financial Statement Presentation
Amounts reported as program revenues include capital grants and contributions,
including special assessments. Internally dedicated resources are reported as
general revenues rather than as program revenues. Likewise, general revenues
include all taxes and interest income.
D.Financial Statement Accounts
1.Cash and Cash Equivalents
Cash and equivalents are defined as deposits that can be withdrawn at any time
without notice or penalty and investments with maturities of three months or less.
Investments are stated at net asset value. The change in fair value of
investments is recognized as an increase or decrease to investment assets and
investment income. The District’s investment policy is detailed in note III.A.
2.Receivables
Receivables are reported net of an allowance for uncollectible accounts.There
was no allowance as of December 31, 2023.
3.Property Taxes
Property taxes are assessed in one year as a lien on the property, but not
collected by governmental units until the subsequent year. In accordance with
GAAP, the assessed but uncollected property taxes have been recorded as a
receivable and as deferred inflow of resources.
4.Sales Taxes
Beginning July 1, 2020, sales taxes are collected on applicable sales within the
District. Sales taxes are to be used for financing, constructing, operating and
maintaining streets, transportation, and safety protection improvements.
5.Capital Assets
Capital assets, which include land, buildings, equipment, vehicles, and
infrastructure assets, are reported in the governmental activity columns in the
government-wide financial statements. The District defines capital assets as
assets with an initial cost of $5,000 or more and an estimated useful life in
excess of five years. Such assets are recorded at historical cost. Donated
capital assets are recorded at estimated fair value at the date of donation.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D4
I.Summary of Significant Accounting Policies (continued)
D.Financial Statement Accounts (continued)
5.Capital Assets (continued)
Infrastructure, buildings, and equipment are depreciated using the straight-line
method over the following estimated useful lives:
Assets Years
Roads and landscaping 20-40
Parking lot improvements 15-40
Equipment and vehicles 5-10
6.Leases
The District is lessee for a noncancellable lease of building. The District
recognizes a lease liability and an intangible right-to-use asset in the
government-wide financial statements.
At the commencement of a lease, the District initially measures the lease liability
at the present value of payments expected to be made during the lease term.
Subsequently, the lease liability is reduced by the principal portion of lease
payments made. The lease asset is initially measured as the initial amount of the
lease liability, adjusted for lease payments made at or before the lease
commencement date, plus certain initial direct costs. Subsequently, the least
asset is amortized on a straight-line basis over its useful life.
Key estimates and judgments related to leases include how the District
determines the following:
Discount Rate: The District uses the interest rate charged by the lessor
as the discount rate to discount the expected lease payments to present
value. When the interest rate charged by the lessor is not provided, the
District uses its incremental bond borrowing rate at the time of
commencement.
Lease Term:The lease term includes the noncancellable period of the
lease and extended term(s) that the District is reasonably certain to
exercise.
The District monitors changes in circumstances that would require a
remeasurement of its leases and will remeasure the lease asset and liability if
certain changes occur that are expected to significantly affect the amount of the
lease liability.
7.Long-term Debt
In the government-wide financial statements, long-term debt is reported as
liabilities. Bond premiums and discounts are deferred and amortized over the life
of the bonds using the bonds outstanding method. Bonds payable are reported
net of the applicable bond premium or discount.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D5
I.Summary of Significant Accounting Policies (continued)
D.Financial Statement Accounts (continued)
7.Long-term Debt (continued)
In the fund financial statements, bond premiums and discounts are recognized
during the current period. The face amount of the debt issued is reported as
other financing sources. Premiums received on debt issuances are reported as
other financing sources while discounts on debt issuances are reported as other
financing uses. Issuance costs, whether or not withheld from the actual debt
proceeds, are reported as debt service expenditures in the fund financial
statements.
8.Deferred Outflows and Inflows of Resources
In addition to assets, the Statement of Net Position will sometimes report a
separate section for deferred outflows of resources. This separate financial
statement element, deferred outflows of resources, represents a consumption of
net assets that applies to a future period(s) and so will not be recognized as an
outflow of resources (expense/expenditure) until then. The District reports
deferred bond refunding charges as a deferred outflow of resources on its
Statement of Net Position as the difference between the reacquisition price and
the net carrying amount of the defeased debt. The deferred charge is amortized
over the life of the refunding bonds, the amortization is included in interest
expense.
In addition to liabilities, the Statement of Net Position will sometimes report a
separate section for deferred inflows of resources. This separate financial
statement element, deferred inflows of resources, represents an acquisition of
net assets that applies to a future period(s) and so will not be recognized as an
inflow of resources (revenue) until that time.The District reports deferred bond
refunding gains as a deferred inflow of resources on its Statement of Net Position
as the difference between the reacquisition price and the net carrying amount of
the defeased debt. The deferred gain is amortized over the life of the refunding
bonds, the amortization reduces interest expense. Unavailable property tax
revenue is deferred and recognized as an inflow of resources in the period that
the amounts become available and earned.
9.Fund Balance
The District classifies governmental fund balances as follows:
Nonspendable -includes fund balance amounts that cannot be spent either
because it is not in spendable form or because of legal or contractual
requirements.
Restricted –includes fund balance amounts that are constrained for specific
purposes which are externally imposed by providers, such as creditors or
amounts constrained due to constitutional provisions or enabling legislation.
Committed –includes fund balance amounts that are constrained for specific
purposes that are internally imposed by the government through formal action of
the highest level of decision making authority which is the Board of Directors.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D6
I.Summary of Significant Accounting Policies (continued)
D.Financial Statement Accounts (continued)
9.Fund Balance (continued)
Assigned –includes spendable fund balance amounts that are intended to be
used for specific purposes that are neither considered restricted or committed.
Fund balance may be assigned by the Board of Directors or its management
designee.
Unassigned -includes residual positive fund balance within the General Fund
which has not been classified within the other above mentioned categories.
Unassigned fund balance may also include negative balances for any
governmental fund if expenditures exceed amounts restricted, committed, or
assigned for those specific purposes.
The District uses restricted amounts first when both restricted and unrestricted
fund balance is available unless there are legal documents/contracts that prohibit
doing this, such as in grant agreements requiring dollar for dollar spending.
Additionally, the District first uses committed, then assigned, and lastly
unassigned amounts of unrestricted fund balance when expenditures are made.
The District does not have a formal minimum fund balance policy. However, the
District’s budget includes a calculation of targeted reserve positions and
management reports the targeted amounts annually to Board of Directors.
E.Use of Estimates
The preparation of financial statements in conformity with GAAP requires the District’s
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and liabilities at the date of the
financial statements, and the reported amount of revenues and expenditures or expenses
during the reporting period. Actual results could differ from those estimates.
II. Stewardship, Compliance, and Accountability
A.Budgetary Information
In the fall of each year, the District's Board of Directors formally adopts a budget with
appropriations by fund for the ensuing year pursuant to the Local Government Budget
Law of Colorado. The budgets for the funds are adopted on a basis consistent with
generally accepted accounting principles (“GAAP”).
As required by Colorado statutes, the District followed the following timetable in
approving and enacting a budget for 2023:
(1)For the 2023 budget year, prior to August 25, 2022, the County Assessor sent to
the District the certified assessed valuation of all taxable property within the
District’s boundaries and prior to December 10, 2022, the County Assessor sent
the final recertified assessed valuation to the District.
(2)On or before October 15, 2022, the District’s accountant submitted to the
District’s Board of Directors a recommended budget which detailed the
necessary property taxes needed along with other available revenues to meet
the District’s operating requirements.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D7
II. Stewardship, Compliance, and Accountability (continued)
A.Budgetary Information (continued)
(3)A public hearing on the proposed budget and capital program was held by the
Board no later than 45 days prior to the close of the fiscal year.
(4)For the 2023 budget, prior to December 15, 2022, the District computed and
certified to the County Commissioners a rate of levy that derived the necessary
property taxes as computed in the proposed budget.
(5)For the 2023 budget, the final budget and appropriating resolution was adopted
prior to December 31, 2022.
After adoption of the budget resolution, the District may make the following changes: a) it
may transfer appropriated monies between funds or between spending agencies within a
fund, as determined by the original appropriation level; b) it may approve supplemental
appropriations to the extent of revenues in excess of the estimated in the budget; c) it
may approve emergency appropriations; and d) it may reduce appropriations for which
originally estimated revenues are insufficient.
Taxes levied in one year are collected in the succeeding year. Thus, taxes certified in
2022 were collected in 2023 and taxes certified in 2023 will be collected in 2024. Taxes
are due on January 1st in the year of collection; however, they may be paid in either one
installment (no later than April 30th) or two equal installments (not later than February 28th
and June 15th) without interest or penalty. Taxes which are not paid within the prescribed
time bear interest at the rate of one percent (1%) per month until paid. Unpaid amounts
and the accrued interest thereon become delinquent on June 15th.
The level of control in the budget at which expenditures exceed appropriations is at the
fund level. All appropriations lapse at year end.
B.TABOR Amendment
In November 1992, Colorado voters amended Article X of the Colorado Constitution by
adding Section 20, commonly known as the Taxpayer's Bill of Rights (“TABOR”). TABOR
contains revenue, spending, tax and debt limitations that apply to the State of Colorado
and local governments. TABOR requires, with certain exceptions, advance voter
approval for any new tax, tax rate increase, mill levy above that for the prior year,
extension of any expiring tax, or tax policy change directly causing a net tax revenue gain
to any local government. Any revenues earned in excess of the fiscal year spending limit
must be refunded in the next fiscal year, unless voters approve retention of such excess
revenue.
Except for refinancing bonded debt at a lower interest rate or adding new employees to
existing pension plans, TABOR requires advance voter approval for the creation of any
multiple-fiscal year debt or other financial obligation unless adequate present cash
reserves are pledged irrevocably and held for payments in all future fiscal years.
TABOR also requires local governments to establish an emergency reserve to be used
for declared emergencies only. The reserve is calculated at 3% of fiscal year spending.
Fiscal year spending excludes bonded debt service and enterprise spending. The District
has reserved $64,290, which is the approximate required reserve, at December 31, 2023.
On November 8, 1994, the voters of the District authorized the issuance of $1,130,000 in
debt and approved up to $125,518 in tax revenue annually to pay such debt.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D8
II.Stewardship, Compliance, and Accountability (continued)
B.TABOR Amendment (continued)
On May 7, 1996, the voters of the District authorized the issuance of $6,620,000 in debt
and approved up to $697,000 in tax revenue annually to pay such debt.
On May 5, 1998, the voters authorized property taxes to be increased up to $800,000 in
1999 and by whatever additional amounts are raised annually thereafter from an increase
in the District’s property tax levy for operating purposes of an additional 17.0 mills
increasing the total operating tax levy to 18.0 mills, all with the present expectation that
the debt service mill levy will decrease by an amount equal to the operating mill levy
increase so as to maintain the current total mill levy of 28.8 mills.
Also, on May 5, 1998, the voters authorized the District to collect, retain, and spend all
revenue and other funds collected in 1998 and any year thereafter without regard to any
limitations under TABOR.
On November 4, 2008, the voters authorized the issuance of $9,500,000 in debt and
approved up to $980,000 in tax revenue annually to pay such debt.
On November 5, 2019, the District voters authorized sales taxes be increased by up to
$850,000 in the first full fiscal year and by whatever additional amounts are raised
annually thereafter by the imposition of a sales tax beginning July 1, 2020, at an initial
rate of 5.0% which rate the Board of Directors may adjust down and up annually within a
cap of 5.0%.
The District's management believes it is in compliance with the financial provisions of
TABOR.
C.Authorized But Unissued Debt
In November 2008,the District’s voters authorized the issuance of up to $9,500,000 of
debt for the acquisition and improvement of parking lot facilities. During 2009,the District
issued bonds in the amount of $9,020,000 pursuant to this authorization and has
$480,000 in remaining authorized but unissued indebtedness as of December 31, 2023.
III.Detailed Notes on all Funds
A.Deposits and Investments
The District’s deposits are entirely covered by federal depository insurance (“FDIC”) or by
collateral held under Colorado’s Public Deposit Protection Act (“PDPA”). The FDIC
insures the first $250,000 of the District’s deposits at each financial institution. Deposit
balances over $250,000 are collateralized as required by PDPA. The carrying amount of
the District’s demand deposits was $41,851 at year end.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D9
III.Detailed Notes on all Funds (continued)
A.Deposits and Investments (continued)
Colorado statutes specify investment instruments meeting defined rating and risk criteria
in which local governments, and entities such as the District, may invest which include:
Obligations of the United States and certain U.S. government agency securities
Certain international agency securities
General obligation and revenue bonds of U.S. local government entities
Bankers’acceptances of certain banks
Commercial paper
Written repurchase agreements collateralized by certain authorized securities
Certain money market mutual funds
Guaranteed investment contract
Local government investment pools
Interest Rate Risk.As a means of limiting its exposure to interest rate risk, the District
diversifies its investments by security type and institution, and limits holdings in any one
type of investment with any one issuer and type of issuer. The District coordinates its
investment maturities to closely match cash flow needs and restricts the maximum
investment term to less than five years (less in some cases) from the purchase date. As
a result of the limited length of maturities the District has limited its interest rate risk.
Credit Risk.District investment policy limits investments to those authorized by State
statutes. The District’s general investment policy is to apply the prudent-person rule:
investments are made as a prudent person would be expected to act, with discretion and
intelligence, to seek reasonable income, preserve capital, and, in general, avoid
speculative investments.
Concentration of Credit Risk.The District diversifies its investments by security type and
institution. Financial institutions holding District funds must provide the District a copy of
the certificate from the Banking Authority that states that the institution is an eligible
public depository.
At year end, the District had the following deposits and investments with the following
maturities:
Standa rd Te rm to Ma turi ty
& Poors Ca rryi ng Le ss than More tha n
Ra ti ng Am ounts one year one year
Depos its:
Chec king and savi ngs Not rat ed 41,851 41,851 -
Cert ificat es of depos it *Not rat ed 1,232,000 491,000 741,000
Investment s:
Inve stment pool AAAm 2,831,646 2,831,646 -
4,105,497 3,364,497 741,000
* non-negotiable certificates of deposit
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D10
III.Detailed Notes on all Funds (continued)
A.Deposits and Investments (continued)
At December 31, 2023, the District had the following recurring fair value measurements.
Total
Col ot rus t 2,831,646
2,831,646
Inve st ments Me asure d
at Net Asse t Value
Fair Value of Investments.The District measures and records its investments using fair
value measurement guidelines established by generally accepted accounting principles.
These guidelines recognize a three-tiered fair value hierarchy, as follows:
Level 1: Quoted prices for identical investments in active markets;
Level 2: Observable inputs other than quoted market prices; and,
Level 3: Unobservable inputs.
Investments classified in Level 1 are valued using prices quoted in active markets for
those securities. Investments classified in Level 2 are valued using the following
approaches:
U.S. Treasuries, U.S. Agencies, and Commercial Paper: quoted prices for identical
securities in markets that are not active;
Repurchase Agreements, Negotiable Certificates of Deposit, and Collateralized Debt
Obligations: matrix pricing based on the securities’ relationship to benchmark quoted
prices;
Money Market, Bond, and Equity Mutual Funds: published fair value per share (unit)
for each fund.
The Investment Pool represents investments in COLOTRUST. The net asset value of
the pool is determined by the pool’s share price. The District has no regulatory oversight
for the pool. At December 31, 2023, the District’s investments in COLOTRUST were
100%of the District’s investment portfolio.
The District had invested $2,831,646 in the Colorado Local Government Liquid Asset
Trust (the “Trust”). The Trust is an investment vehicle established for local government
entities in Colorado to pool surplus funds. The State Securities Commissioner
administers and enforces all State statutes governing the Trust. The Trust operates
similarly to a money market fund, measured at net asset value, and each share is equal
in value to $1.00. Investments consist of U.S. Treasury bills, notes and note strips and
repurchase agreements collateralized by U.S. Treasury securities. A designated
custodial bank provides safekeeping and depository services in connection with the direct
investment and withdrawal functions. Substantially all securities owned are held by the
Federal Reserve Bank in the account maintained for the custodial bank.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D11
III.Detailed Notes on all Funds (continued)
B. Capital Assets
An analysis of the changes in capital assets for the year ended December 31, 2023,
follows:
Be ginning En ding
Ba lance Incre ases De cre ases Ba lance
Capital as sets, not being deprec iated:
Land - park ing lot 7,500,000 - - 7,500,000
Water rights 294,817 - - 294,817
Cons truc tion in progres s 102,518 32,016 - 134,534
Capi tal as sets bei ng deprec iated & amort iz ed:
Equipment and ve hi cles 671,400 18,252 - 689,652
Park ing lot improvem ent s 1,524,728 24,681 - 1,549,409
Roads and lands capi ng 12,993,138 - - 12,993,138
Leas ed fa cilities 184,000 - - 184,000
To tal capital as sets 23,270,601 74,949 - 23,345,550
Les s accumulated deprec iation for:
Equipment and ve hi cles (501,661) (41,246) - (542,907)
Park ing lot improvem ent s (626,010) (42,203) - (668,213)
Roads and lands capi ng (8,326,403) (398,414) - (8,724,817)
Les s accumulated am ort ization for leas ed as sets:(4 6,000) (46,000) - (92,000)
To tal accumulated deprec iation & amort ization (9,500,074) (527,863) - (10,027,937)
Ne t Ca pital Asse ts 13,770,527 (452,914) - 13,317,613
Depreciation and amortization expense and capital outlay expenditures are classified by
function as follows:
De pre ci ation
Ca pital and Amorti zati on
Outl ay Ex pe nse
Public Work s 50,268 509,556
Tr ans port ation 24,681 18,307
74,949 527,863
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D12
III.Detailed Notes on all Funds (continued)
C.Leases Payable
Related to leased assets, the District has the following outstanding agreements as of
December 31, 2023:
Maintenance Facility Lease:In 2018, the District entered into a 96-month lease
agreement as lessee for a maintenance facility owned by Vail Resorts
Development Co., a subsidiary of Vail Resorts. The calls for fixed monthly lease
payments of $3,929.57. Beginning January 1, 2022, the monthly rent will be
adjusted by the Consumer Price Index –All Urban Consumers for the Denver-
Boulder area. This lease agreement is in connection with the District’s
Operations Agreement with Vail Resorts (see Note VI.A.)
Leased asset payment requirements at December 31, 2023 were as follows:
Principa l Interest Total
2024 46,277 878 47,155
2025 46,845 310 47,155
To tal 93,122 1,188 94,310
The District recognized the following lease expenses under long-term leases during the
year:
Ge ne ra l
Fund Total
Le ase expense s:
Principal 45,716 45,716
In teres t 1,439 1,439
Variabl e 8,621 8,621
To tal 55,776 55,776
D.Long-term Debt
The District had the following long-term debt outstanding during the fiscal year:
1.General Obligation Refunding Bonds, Series 2017
$8,385,000 General Obligation Refunding Bonds, Series 2017, dated January
18, 2017, with interest of 2.29% payable semiannually on June 1 and December
1 of each year. The bonds are subject to Mandatory Sinking Fund Redemption
prior to maturity in part, by lot, upon payment of par and accrued interest, at a
redemption price not to exceed 100% of principal amount redeemed, on
December 1 each year until final maturity December 1, 2031.
The bonds were issued for the purpose of refunding $7,570,000 of the District’s
General Obligation Refunding Bonds, Series 2009, and to pay the cost of issuing
the bonds. The proceeds were deposited with an escrow agent to provide for
future debt service payments on the refunded Series 2009 bonds.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D13
III.Detailed Notes on all Funds (continued)
D.Long-term Debt (continued)
1.General Obligation Refunding Bonds, Series 2017 (continued)
The District also obtained an economic gain (difference between the present
values of the old and new debt service payments) of $600,154 on the refunding.
2.General Obligation Refunding Bonds, Series 2019
$2,030,000 General Obligation Refunding Bonds, Series 2019, dated December
9, 2019, with interest of 2.41% payable semiannually on June 1 and December 1
of each year. The bonds are subject to Mandatory Sinking Fund Redemption,
prior to maturity, in part, at a price of par, plus accrued interest to the redemption
date, on December 1 each year until final maturity December 1, 2032.
The bonds were issued for the purpose of refunding $1,985,000 of the District’s
General Obligation Refunding Bonds, Series 2009, and to pay the cost of issuing
the bonds. The proceeds were deposited with an escrow agent to pay the
accrued interest and outstanding principal of the Series 2009 bonds.
The District also obtained an economic gain (difference between the present
values of the old and new debt service payments) of $221,196 on the refunding.
3.General Obligation Refunding Bonds, Series 2021
$1,650,000 General Obligation Refunding Bonds, Series 2021, dated December
1, 2021, with interest of 2.42% payable semiannually on June 1 and December 1
of each year. The bonds are subject to Mandatory Sinking Fund Redemption,
prior to maturity, in part, at a price of par, plus accrued interest to the redemption
date, on December 1 each year until final maturity December 1, 2032.
The bonds were issued for the purpose of refunding $1,610,000 of the District’s
General Obligation Refunding Bonds, Series 2011, and to pay the cost of issuing
the bonds. The proceeds were deposited with an escrow agent to pay the
outstanding principal of the Series 2011 bonds.
The District also obtained an economic gain (difference between the present
values of the old and new debt service payments) of $100,912 on the refunding.
Annual debt service requirements to maturity for the general obligation bonds are as
follows:
Principa l Interest Total
2024 865,000 182,973 1,047,973
2025 885,000 162,789 1,047,789
2026 905,000 142,140 1,047,140
2027 930,000 121,026 1,051,026
2028 955,000 99,322 1,054,322
2029 - 2032 3,290,000 167,167 3,457,167
To tal 7,830,000 875,417 8,705,417
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D14
III.Detailed Notes on all Funds (continued)
D.Long-term Debt (continued)
The District had the following changes in long-term obligations for the year ended
December 31, 2023:
Be ginning En ding Due Within
Ba la nce Additi ons Re ducti ons Ba la nce One Year
Bonds payable:
G.O. Bonds , Seri es 2017 5,455,000 - (555,000) 4,900,000 565,000
G.O. Bonds , Series 2019 1,570,000 - (140,000) 1,430,000 140,000
G.O. Bonds , Series 2021 1,650,000 - (150,000) 1,500,000 160,000
To tal bonds pay able:8,675,000 - (845,000) 7,830,000 865,000
Leas es pay able 138,838 - (45,716) 93,122 46,277
8,813,838 - (890,716) 7,923,122 911,277
IV.Other Information
A.Risk Management
Colorado Special Districts Property and Liability Pool
The District is exposed to various risks of loss related to torts, thefts of, damage to, or
destruction of assets; errors or omissions; or injuries to employees.
The District is a member of the Colorado Special Districts Property and Liability Pool
(Pool) as of December 31, 2014. The Pool is an organization created by
intergovernmental agreement to provide property, liability, public officials’ liability, boiler
and machinery, and workers compensation coverage to its members. The Pool provides
coverage for property claims and liability coverage claims and workers' compensation.
Settled claims have not exceeded this coverage in the past three years.
The District pays annual premiums to the Pool for liability, property, and public officials’
coverage. In the event aggregated losses incurred by the Pool exceed amounts
recoverable from reinsurance contracts and funds accumulated by the Pool, the Pool
may require additional contributions from the Pool members. Any excess funds which the
Pool determines are not needed for purposes of the Pool may be returned to the member
pursuant to a distribution formula.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D15
IV.Other Information (continued)
A.Risk Management (continued)
Colorado Special Districts Property and Liability Pool (continued)
A summary of audited statutory basis financial information for the Pool as of and for the
year ended December 31, 2023 (the latest audited information available) is as follows:
Asse ts 81,143,798
Liabi lities 58,670,068
Capi tal and surplus 22,473,730
Total 81,143,798
Revenue 29,593,851
Underwriting ex pens es 31,416,477
Underwriting gain (l os s)(1,822,626)
Other income 1,695,393
Ne t income (loss)(127,233)
V.Intergovernmental Agreements
A. Upper Eagle Regional Water Authority
The District is a participant in the Upper Eagle Regional Water Authority (the “Authority”).
The Authority was formed pursuant to an establishing contract on September 18, 1984,
by the following entities located in Eagle County, Colorado (the “Contracting Parties”):
Arrowhead Metropolitan District
Town of Avon
Beaver Creek Metropolitan District
Berry Creek Metropolitan District
Eagle-Vail Metropolitan District
Edwards Metropolitan District
The purposes of the Authority are to supply water for domestic and other public and
private purposes; to provide all necessary water diversion works, reservoirs, treatment
works and facilities, equipment and appurtenances incident thereto; to effect the
development of water resources, systems or facilities, in whole or in part, for the use and
benefit of the Contracting Parties, their inhabitants, and others; and to provide efficient,
effective, and reliable water service.
The Authority is to remain in effect until it has no bonds, notes or other obligations
outstanding and the Contracting Parties unanimously consent to its dissolution. The
initial term of this Authority Agreement shall be ten (10) years ending on December 31,
2023, but such term shall be subject to automatic renewal and extension for successive
ten (10) year terms thereafter unless all of the Contracting Parties unanimously approve
changes to this Authority Agreement during any extended term, to be effective on the first
day of the extended term, including provision for payment of all bonds, notes and other
obligations outstanding in accordance with their terms. At December 31, 2022, the
Authority had debt with maturities through the year 2050.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D16
V.Intergovernmental Agreements (continued)
A. Upper Eagle Regional Water Authority (continued)
Dissolution of the Authority requires the unanimous consent of the Contracting Parties
and provision for a successor entity that will continue to provide service to the water
service customers. Any provision for dissolution shall provide either that all the
Authority’s financial obligations be paid in full or that funds sufficient for the payment of
the Authority’s obligations be placed in escrow. Upon dissolution without conveyance of
all water rights and assets to a successor entity, the interest in the net position of the
Authority including interests in unallocated water rights shall be distributed to each
contracting party in proportion to the average annual amount of treated water sold within
the boundaries of each Contracting Party.
The Contracting Parties, including the District, and other parties served by contract have
previously conveyed to the Authority their individual water systems, except for certain golf
course water systems, raw water storage and raw water irrigation systems, subject to
existing agreements between the Authority and any Contracting Party. The customers of
the Contracting Parties thereby became water service customers of the Authority. The
Authority shall make Rules and Regulations concerning the operation of the Authority's
Water System. These water systems were accepted by the Authority in "as is" condition
and (subject to any contract obligations) all future maintenance, repair and upgrade
expenses became the obligations of the Authority, and not the obligations of the
Contracting Parties or the third party served by contract. In connection therewith, on
February 25, 2015 the District adopted a resolution terminating collection of future water
tap fees by the District (except for tap fees for properties on Arrowhead Mountain which
will continue until the District’s 2011 bonds are paid off; current maturity is December 1,
2031).
The Contracting Parties have leased and/or conveyed to the Authority all of the
Contracting Parties' right, title and interests in and to the Contracting Parties' water rights,
including the right to use all diversion ditches, pipelines, headgates and structures,
reservoirs or other storage structures, pumps, casings, and other improvements and
easements associated or used in connection with the water rights, for the Authority's use
in carrying out its functions and providing water service.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D17
V.Intergovernmental Agreements (continued)
A.Upper Eagle Regional Water Authority (continued)
A summary of audited financial information for the Authority as of and for the year ended
December 31, 2022 (the latest audited information available) is as follows:
Asse ts:
Current 18,923,522
Ot her 8,795,577
Propert y and equipment 97,933,909
Tota l Asse ts 125,653,008
De fe rre d Outflow of Resources 395,941
Tota l Asse ts and Deferre d Outfl ow of Resource s 126,048,949
Liabilitie s and Net Position:
Current 7,186,569
Long-term debt 57,919,367
Net pos ition 60,943,013
Tota l Liabilities and Net Position 126,048,949
Ope ra ti ons:
Operating revenue 15,684,126
Operating expens e 17,642,069
Ope ra ti ng income (1,957,943)
Othe r income 255,586
Othe r e xpense (1,886,814)
Ne t (l oss)(3,589,171)
Ca pita l contributions 3,603,236
Ne t Position - Beginning 60,928,948
Ne t Position - Ending 60,943,013
Up pe r Ea gle Regiona l Water Authority
VI.Developer Contracts
A.Vail Resorts
Vail Resorts (“VR”) was the primary developer within the District. Effective January 1,
2004, the District entered into an Operations Agreement with VR to perform operations
and maintenance services for the District’s road improvements. This agreement was
effective through December 31, 2017.
Effective January 1, 2018, the District entered into a new Operations Agreement with VR
to perform operations and maintenance services for the District’s road improvements.
This agreement is effective through December 31, 2018, and automatically renews for
two separate successive periods of one year each.
Effective January 1, 2021, the District entered into the first amendment to the new
Operations Agreement with VR to perform operations and maintenance services for the
District’s road improvements. This agreement is effective through December 31, 2021,
and automatically renews for five separate successive periods of one year each.
Arrowhead Metropolitan District
Notes to the Financial Statements
December 31, 2023
(Continued)
D18
VI.Developer Contracts (continued)
A.Vail Resorts (continued)
Costs incurred during 2023 under the terms of the Operations Agreement amounted to
$283,354.
The District also contracts with VR to operate the District’s transportation system. During
2023,the District paid VR $398,002 for transportation services.
The District owed VR $30,061 at December 31, 2023.
REQUIRED SUPPLEMENTARY INFORMATION
2022
Final
Budget
Original Variance
and Final Positive
Budget Ac tual (Negative)Actual
Revenues:
Interest 69,575 158,944 89,369 59,211
Property taxes 1,234,193 1,234,190 (3) 1,248,827
Specific ownership taxes 60,475 70,714 10,239 67,960
Sales tax 1,050,000 1,260,804 210,804 1,051,552
Charges for services 46,047 46,047 - 45,831
Lottery proceeds 1,896 2,014 118 1,877
Other income 79,000 101,718 22,718 18,396
Total Revenues 2,541,186 2,874,431 333,245 2,493,654
Expenditures:
General government:
Office overhead 29,806 17,151 12,655 17,245
Legal 4,515 5,487 (972) 3,049
Audit 7,450 7,450 - 7,850
Insurance 12,156 11,931 225 11,300
Director's fees 6,000 4,800 1,200 5,000
Treasurer's fees 37,027 37,064 (37) 37,501
Operating fees 72,662 68,586 4,076 64,440
Contingency 75,000 - 75,000 -
Public works:
Maintenance and snow removal 553,072 554,777 (1,705) 368,770
Transportation 454,377 398,002 56,375 273,668
Lease obligations 55,781 55,776 5 50,496
Capital expenditures 565,785 498,289 67,496 627,532
Total General Government Expenditures 1,873,631 1,659,313 214,318 1,466,851
Other Financing Sources:
Transfers (out)(495,966) (483,682) 12,284 (503,347)
Total Other Financing Sources (495,966) (483,682) 12,284 (503,347)
Net Change in Fund Balance 171,589 731,436 559,847 523,456
Fund Balance - Beginning 3,478,715 3,491,323 12,608 2,967,867
Fund Balance - Ending 3,650,304 4,222,759 572,455 3,491,323
Schedule of Revenues, Expenditures and Changes in Fund Balance
Arrowhead Metropolitan District
2023
(With Comparative Actual Amounts For the Year Ended 2022)
For the Year Ended December 31, 2023
Governmental Funds - General Fund
Budget and Actual
E1
SUPPLEMENTARY INFORMATION
2022
Final
Budget
Original Variance
and Final Positive
Budget Ac tual (Negative)Actual
Revenues:
Property taxes 542,058 542,559 501 548,997
Specific ownership taxes 26,561 31,081 4,520 29,871
Interest 3,365 7,679 4,314 2,499
Total Revenues 571,984 581,319 9,335 581,367
Expenditures:
General government:
Treasurer fees 16,262 16,284 (22) 16,475
Debt service:
Bond principal 845,000 845,000 - 845,000
Bond interest 202,687 202,687 - 222,229
Paying agent fees 4,000 1,030 2,970 1,010
Bond issuance costs - - - 241
Total Expenditures 1,067,949 1,065,001 2,948 1,084,955
Other Financing Sources (Uses):
Transfers in 495,965 483,682 (12,283) 503,347
Total Other Financing (Uses)495,965 483,682 (12,283) 503,347
Net Change in Fund Balance - - - (241)
Fund Balance - Beginning 43,626 43,626 - 43,867
Fund Balance - Ending 43,626 43,626 - 43,626
Schedule of Revenues, Expenditures and Changes in Fund Balance
Ar rowhead Metropolitan District
2023
(With Comparative Actual Amounts For the Year Ended 2022)
For the Year Ended December 31, 2023
Governmental Funds - Debt Service Fund
Budget and Actual
F1
Calendar Prior Year Al l Percent
Year Assessed Valuation Funds Property Taxes Collected
Ended For Current Year Mills Total All Funds to
December 31 Property Tax Levy Levied Levied Collected Levied
2005 78,263,640 20.00 1,565,273 1,565,123 100.0%
2006 86,092,500 20.00 1,721,850 1,720,168 99.9%
2007 89,493,320 20.00 1,789,866 1,787,557 99.9%
2008 115,184,770 17.00 1,958,141 1,954,281 99.8%
2009 115,436,520 17.00 1,962,421 1,961,748 100.0%
2010 135,933,930 17.00 2,310,877 2,298,735 99.5%
2011 134,150,510 17.00 2,280,559 2,279,856 100.0%
2012 99,220,770 17.00 1,686,787 1,684,813 99.9%
2013 94,163,700 17.00 1,690,078 1,671,255 98.9%
2014 97,905,240 17.00 1,664,389 1,662,558 99.9%
2015 98,420,720 17.00 1,673,152 1,673,150 100.0%
2016 109,447,160 18.50 2,024,773 2,020,029 99.8%
2017 109,618,530 18.50 2,027,943 2,027,454 100.0%
2018 108,094,500 18.50 1,999,748 1,996,729 99.8%
2019 106,742,870 18.50 1,975,244 1,975,239 100.0%
2020 115,637,620 17.00 1,966,322 1,964,872 99.9%
2021 116,432,580 17.00 1,979,839 1,995,577 100.8%
2022 124,965,150 14.50 1,812,321 1,797,824 99.2%
2023 122,399,230 14.50 1,775,108 1,776,749 100.1%
2024 209,695,320 7.56 1,586,037
NOTE:
Property taxes collected in any one year include collection of delinquent property
taxes levied in prior years. Information received from the County Treasurer does
not permit identification of specific year of levy.
December 31, 2023
and Property Taxes Collected
History of Assessed Valuation, Mill Levy
Arrowhead Metropolitan District
F2
Bonds and
Interest
Maturing
in the
Year Ending
December 31,Principal Interest Principal Interest Principal Interest Principal Interest Total
2024 565,000 112,210 140,000 34,463 160,000 36,300 865,000 182,973 1,047,973
2025 580,000 99,272 140,000 31,089 165,000 32,428 885,000 162,789 1,047,789
2026 595,000 85,990 140,000 27,715 170,000 28,435 905,000 142,140 1,047,140
2027 605,000 72,364 150,000 24,341 175,000 24,321 930,000 121,026 1,051,026
2028 615,000 58,510 155,000 20,726 185,000 20,086 955,000 99,322 1,054,322
2029 635,000 44,426 160,000 16,991 190,000 15,609 985,000 77,026 1,062,026
2030 645,000 29,885 170,000 13,135 200,000 11,011 1,015,000 54,031 1,069,031
2031 660,000 15,114 175,000 9,038 215,000 6,171 1,050,000 30,323 1,080,323
2032 - - 200,000 4,819 40,000 968 240,000 5,787 245,787
Total 4,900,000 517,771 1,430,000 182,317 1,500,000 175,329 7,830,000 875,417 8,705,417
Arrowhead Metropolitan District
Totals
December 31, 2023
Schedule of Bond Obligations and Interest Requirements to Maturity
Due June 1 and December 1
December 1, Interest at 2.41%
December 9, 2019, Principal Due
Obligation Refunding Bonds
$2,0300,000 General
Due June 1 and December 1
December 1, Interest at 2.29%December 1, Interest at 2.42%
Due June 1 and December 1
January 18, 2017, Principal Due
Obligation Refunding Bonds
$8,385,000 General $1,650,000 General
Obligation Refunding Bonds
December 1, 2021, Principal Due
F3
