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May 20, 2001

TO THE CITIZENS OF LARIMER COUNTY, COLORADO

We submit, for your information and review, the Comprehensive Annual Financial Report of Larimer County, Colorado, for the year ended December 31, 2000.

This report was prepared by the Department of Accounting and Reporting of the County's Division of Financial Services. The responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the County. To the best of our knowledge the enclosed information is accurate in all material respects and is reported in a manner designed to fairly present the financial activity and results of operations of the various funds and account groups of the County. The Staff has included all disclosures necessary to enable the reader to gain maximum understanding of the County's financial affairs. The organization, form and content of the report conform to the standards of the Governmental Accounting Standards Board, the American Institute of Certified Public Accountants, the Government Finance Officers Association, and the Colorado State Auditor.

The intended purposes of the report are to:

• Officially demonstrate our accountability to you, the citizens of Larimer County: (1) financially, by presenting the results of County operations for the 20007 fiscal year and the County's financial position at December 31, 2000; and (2) legally, by presenting comparisons of actual revenues and expenditures with budgeted amounts;

• Provide County management with audited financial results of the 2000 fiscal year to assist them in continuing to make informed fiscal decisions;

• Supply all interested parties with a comprehensive picture of the County's financial condition, historical and demographical data; and

• Comply with federal and state regulations and statutes by contracting for annual independent audits of the County's financial statements and the systems utilized to generate them, as well as federally funded programs.

The Comprehensive Annual Financial Report is divided into four sections with the intent to meet the needs of a variety of users:

Introductory Section -- includes the table of contents, this transmittal letter, a reproduction of the Certificate of Achievement for Excellence in Financial Reporting awarded to Larimer County for our 1999 CAFR, and a listing of the County's principal officials and an organization chart.

Financial Section -- consists of the combined General Purpose Financial Statements (GPFS) which provide an overview for those who are interested in less-detailed information about the County's financial position. Following the GPFS are detailed exhibits and schedules applicable to the individual funds and account groups of the County. Descriptions of the nature and purpose of the various fund types and account groups are provided in the Notes to Financial Statements and individual fund descriptions are provided throughout the remainder of the Financial Section.

Statistical Section -- contains comprehensive statistical data relating to Larimer County. This section is designed to provide the user with a broader and more complete understanding of the County's financial history and trends over the ten-year period 1991 through 2000. Also included is social and economic data that will be of value to those desiring non-financial information about the County.

Single Audit Schedules -- includes a schedule of the County's federal financial assistance programs and various independent auditors' reports thereon, necessary to comply with the Single Audit Act of 1984.

Larimer County is located in north central Colorado. It ranks ninth in size and seventh in population among Colorado counties. The County covers 2,640 square miles, stretching north to the Wyoming border and west to the Continental Divide. It encompasses some of the finest irrigated farmland in the state, as well as vast stretches of scenic ranch lands, forests and high mountain peaks. Over 50% of Larimer County is publicly owned land, most of which is within Roosevelt National Forest and Rocky Mountain National Park. In addition to these Federal lands, Colorado State Parks and Recreation Areas, Larimer County Parks and local parks within urban areas combine to provide a wide spectrum of recreational opportunities that are enjoyed by both residents and visitors.

Approximately 75% of County residents live in incorporated areas. Larimer County encompasses six incorporated cities and towns, and a portion of two other towns. Fort Collins is the largest city with a population of 115,630 in the year 2000. The city has been named one of the best places to live in America by a number of national trend sources. Most recently, it was named the Best Small Town in the West by Money Magazine. Loveland is the second largest city with a population of 49,331. It is known worldwide as the 'Sweetheart City' for its valentine re-mailing program. The beautiful mountain town of Estes Park is home to 5,229 people. The total population of Larimer County in 2000 was 251,494.

Larimer County provides the full range of services contemplated by State Statute. Services include:

• Judicial and public safety - consisting of the Sheriff, District Attorney, operation and maintenance of the detention center, and building inspection;
• Planning and zoning;
• Property valuation, tax collection and distribution, and vehicle licensing;
• Construction, reconstruction and maintenance of streets, highways, and bridges;
• Health, employment, and social services;
• Parks and recreation; and
• General administrative services.

The County is governed by a three member Board of County Commissioners. Commissioners are elected from districts of relatively equal population by the voters at large. They serve staggered four-year terms and function as the County's policymaking body. An appointed County Manager is responsible for operations of the County on a daily basis. The County is also served by seven other elected officials: assessor, clerk and recorder, coroner, sheriff, treasurer, district attorney, and surveyor.

This report includes all activities for which the Board of County Commissioners is accountable to the citizens of Larimer County, financially or by State Statute, in accordance with Governmental Accounting Standards Boards (GASB) Statement 14, "The Financial Reporting Entity". All applicable funds, organizations, institutions, agencies, departments, and offices, which are not separate legal entities, are included in these financial statements as part of the "primary government" of Larimer County.

The County considers several entities as 'component units' under governmental accounting standards. Although legally separate, the entities have significant operational or financial relationships with the County. The Larimer County Pest Control District, the Public Trustee, the Larimer County Building Authority and numerous general improvement districts are blended component units. The Public Trustee is a discretely presented component unit. Therefore, the County's financial statements also include these entities.

Larimer County has joined with nineteen other local governments to form the Larimer Emergency Telephone Authority (LETA), and has joined with the City of Fort Collins to purchase and manage property known as Block 31. Larimer County's relationship in these two organizations, referred to as a jointly governed organization and a joint operation, respectively, is discussed in the Notes to Financial Statements. LETA is a separate legal entity and issues its own financial statements. Larimer County reports the receipt and distribution of funds received on behalf of LETA in an agency fund to demonstrate our fiduciary responsibility to the entity.

Larimer County has a diversified economy ranging from agriculture in the eastern part of the County to the high mountain tourist and recreational areas of Rocky Mountain National Park in the western area. In between these two extremes are major manufacturing, industrial, and technology facilities, as well as a strong retail base. Colorado State University, located in Fort Collins, is highly recognized for its veterinary medicine teaching hospital andas well as its other research facilities. Loveland and Estes Park, in particular, benefit greatly from the tourist industry. Loveland is located on the main highway leading to Rocky Mountain National Park and is renowned for its artist community. Estes Park is situated at the immediate east entrance of the Park. Fort Collins, the County seat, is the regional shopping area for the northeastern section of Colorado, southern Wyoming and western Nebraska.

The year 2000 was an exceptional one for Colorado.was vigorous Unemployment dropped to 2.9%, which was a record low for the State. Wage and salary income increased 10.9%. Housing construction was at the highest level in thirty years. Although non-residential construction was lower than in the previous year, it still reached the second-highest level on record. This economic good news was further reflected in consumer spending, which rose by 11.5%. This positive news was only tempered slightly by an inflation rate of 4%, which is higher than in recent years.

Larimer County, with its diverse economic base and high quality of life, was a major contributor to the State's robust economy. Countywide building permits reached a record high of 14,133 in 2000. Cost of construction was $177.96 $461 million. 8.4 Estimated values for residential, commercial and industrial, agricultural and natural resource real property increased an average of 185% to a total of $15 7 billion dollars. Larimer County's unemployment rate was 33.2%. Tstate average and axable retail sales rose by almost 97.7%.

Along with much of the front range of Colorado, Larimer County is experiencing healthy population growth. Between 1991 and 2000, County population increased by almost a third. School enrollment increased by 6,857 students 19% during the same period. The State Demographer projects 270,000 240,000 total population by the year 2005.

Analysts predict that Colorado and Larimer County will continue to enjoy a positive economic atmosphere, although growth will be slower than in the 1990's. It is estimated that the national slowdown will only have a slight impact on Colorado in 2001. Personal income, job growth, and unemployment statistics will remain positive; however the scarcity of workers and high cost of living compared to neighboring states will continue to frustrate employers. Construction will level out as supply finally catches up to demand. In Larimer County, several new mixed-use office, retail, and hotel developments are in the planning stages. The County's strong technology sector is in flux, with some firms contemplating layoffs, while others are expanding.

Facilities planning and construction continued to be a major emphasis of the County inAs in past years, 1998 was a year during which the County implemented many new and innovative ideas, projects and programs. Some of these activities are highlighted below.

2000. A host of other projects took the stage as well. Some of these activities are highlighted below.

The County is in the third year of an aggressive capital construction program. In the fall of 1997, voters approved a .4% sales tax to support a host of new County facilities. The County issued $71,010,000 in certificates of participation (COPs) to finance the projects, which included:

• New Justice Centers in Fort Collins and Loveland;
• Expansion of the County Detention Center, which doubles the capacity of the existing facility;
• Remodeling of existing County administrative facilities in Fort Collins and Loveland;
• A joint City/County parking garage in Fort Collins; and
• An administration building for the Sheriff's Department.

The parking garage, which was the first completed project, opened to the public in late 1999. In 2000, grand openings were held for the Justice Center in Fort Collins, Detention Center Expansion, and Sheriff's Administration building.

The Justice Center was the largest of the 2000 projects. The five-story, 172,000 square foot building incorporates natural daylighted spaces, fourteen courtrooms, and state of the art security. Natural stone and cherry wood, which is indigenous to the region, is used throughout the building. Adjacent to the building is Civic Center Park, a joint development between the City of Fort Collins and Larimer County. A series of geyser fountains are arranged among a setting of natural rock groupings throughout the park. The park's plaza area can be used as an impromptu stage while a sloped grassy area forms an informal natural amphitheater. Over eight hundred people attended the September dedication and toured the building.

The two remaining projects - a new justice center in Loveland, and County administrative facilities - are underway. The Loveland Justice Center, a joint project between Larimer County and the City of Loveland, is scheduled to open in spring of 2002. The County administrative facilities project will be the last one completed, due to a significant change in project direction. Under the initial ballot question, the County planned to remodel the existing administrative building; however a study revealed that it would be more cost effective build a new facility, rather than attempting to remodel the 1950's era building. Voters approved this change in a special mail-in election on June 6, 2000. Planning is now underway for this new facility.

The Northern Colorado region has always lacked a venue for large special events. The existing County Fairgrounds, built in the 1940's, partially fills this function, but its aging facilities and poor location fall far short of the growing community's needs. In the fall of 1998, voters approved a .10% sales tax for one year to purchase land for a new Larimer County Fairgrounds and Events Center. With this funding, the County acquired 243 acres of land with access and visibility to Colorado's major north-south transportation corridor, Interstate 25.

One year later, voters approved a twenty-year .15% sales tax beginning in 2000 to construct and operate the Fairgrounds and Events Center facility. Preliminary plans for this exciting project include a 6,000 seat indoor area, a large exhibition building, livestock buildings, outdoor arenas, and a building for 4-H and other community events. To ensure community involvement and adequate planning, the ballot question requires that traffic issues are adequately addressed and private sector participation of not less than $3 million dollars is committed prior to construction. Much work remains to be done prior to groundbreaking, including site development plans, traffic studies, fundraising, marketing, and financing plans. The estimated facility opening is in 2003.

The mission of the Larimer County Open Lands Program is to preserve open space, natural areas, wildlife habitat, parks, and trails for present and future generations. These open lands provide opportunities for leisure, human renewal and protection of our natural and cultural diversity. In November of 1999, County citizens gave the Open Lands Program a resounding vote of support. Not only did citizens approve an extension of the open lands sales and use tax, but they also authorized the County to issue up to $54 million in revenue bonds for the purchase of land.

The results after the first full year of the election are impressive - more than 3,200 acres were protected in 2000 alone. Three projects were of special significance to area residents:

• Fossil Creek Reservoir: In partnership with the City of Fort Collins, a long-standing vision of protecting this area was achieved. This 666-acre project protects key winter habitat for bald eagles, and provides opportunities for hiking and other nature-oriented activities.
• Eagle's Nest Ranch: Straddling the North Fork of the Poudre River, this property provides critical riparian habitat and enhances access to a large block of Roosevelt National Forest.
• Enos Mills Homestead: Enos Mills is acknowledged as the father of Rocky Mountain National Park. The historic homestead where he lived and worked and the surrounding 192 acres were preserved through a conservation easement. This project was accomplished through a partnership with the Estes Valley Land Trust.

These projects, and several others, were funded in part by proceeds from Series 2000 $15,000,000 sales tax revenue bonds. The AAA-insured debt received underlying ratings of "A1" from Moody's and "A" from Standard & Poor's.

The Larimer County Courthouse was built in 1954 when the population of the County was 50,000. In 1969, as the population neared 90,000, an addition was built. Population has now more than doubled since 1969, while County owned facilities to meet these needs have not increased significantly. Crowded, inadequate, and unsafe conditions exist in some buildings, especially in areas related to law enforcement and justice.

The County placed a facilities funding question on the November 1996 ballot. Entitled Project SAFE, the ballot issue addressed the most critical of the County's building needs. The issue called for a twenty-year .43 of 1% sales tax to fund expansion and operation of a expanded jail; justice centers in Fort Collins and Loveland; remodeling of the existing courthouse in Fort Collins; and a sheriff's administration building. The ballot proposal did not pass, but did win 40% approval with the voters. Using input from voters, the County restructured the facilities project and returned it to the ballot in 1997. Voters indicated that the 1996 ballot question was too complex; therefore the 1997 ballot contained two separate issues. Both issues were passed by the voters in November 1997.

The first approved issue was a .2% seventeen-year sales tax increase for expansion of the County's detention center. This 65,000 square feet addition will almost double the County's existing 309 inmate capacity. A portion of the .2% tax will go towards operation and maintenance of the new facility. The second ballot issue increased sales tax by an additional .2% for the construction of several judicial facilities. These include: 1) a new County courthouse building of approximately 151,300 square feet to include 14 courtrooms; 2) a sheriff's headquarters building to house radio dispatch, patrol, and administration offices; 3) a small courthouse in Loveland, and renovation of the existing Loveland offices; and 4) renovation of the County's administrative offices in Fort Collins. All are scheduled for completion over the next three years.

The County issued $71,010,000 in certificates of participation (COPs) in March of 1998 to finance the facility projects. The insured COPs received an A1 underlying debt rating from Moody's Investors Service, and an A+ from Standard & Poor's. The average yield on the debt is 4.89%.

Completion of the Larimer County Master Plan was a major accomplishment of the Planning Division in 1997. As a part of the Partnership Land Use System (PLUS), the Master Plan provides policy direction for land use and development in the unincorporated area of Larimer County. The next phase of PLUS is completion of a unified Land Use Code to help implement the Master Plan.

Development of the Master Plan involved input from hundreds of citizens over a period of more than three years. Major innovations of the Plan include required clustering of new rural subdivisions to provide up to 80% open space and principles for protection of sensitive natural areas such as wetlands and important wildlife habitat. Adequate public facilities will be required for new development and impact fees will help new development contribute its fair share to expansion of needed facilities. Larimer County received the Governor's 'Smart Growth Award' in 1997 for developing innovative land use management tools.

Developing strategies for implementing changes brought about by Federal and State welfare reform legislation was a major emphasis of the County in 1997. The Board of County Commissioners created a division of Health and Human Services (HHS), which includes the departments of Health and Environment, Mental Health, Employment and Training, Community Corrections, Community Services, and Extension. HHS directors met regularly to recommend County values for welfare reform, plan methods for client and employer input, and begin the back-breaking work of implementation details. The County philosophy ultimately included tight collaboration, a one-stop concept for client access, intense line-staff input, and strong emphasis upon community building for job retention.

The one-step client access concept began with centers in Loveland and Fort Collins. These centers are staffed by ETS/Community Services, and include Mental Health workers who have drug and alcohol counseling expertise. The mental health workers also provide training to case managers and technicians which help them in identifying client problems.

The community building piece of Larimer's Welfare Reform plan also started in 1997. There is no doubt that people can get jobs, but Larimer believes that the real work is to help clients create their own community network so that they are less likely to come back into the system. The County created a unit dedicated to matching community sponsors with clients. Sponsors can give time, money, or other in-kind services; they can be churches, businesses, civic organizations, or individuals. They might fix cars, provide day care, tutor students, or pay for classes. After the County matches the client with the sponsor, it steps out of the way so that the Community can take over.

Because welfare public policy is seldom based upon real data, the County intends to partner with Colorado State University and others to evaluate which of these interventions are working and what changes need to be made in the future to best invest the County's welfare dollars.

The Fleet Services Department maintains County vehicles, including heavy equipment, emergency response vehicles and passenger vehicles. During 1997, Fleet completed upgrades which added three refueling sites to the County's fuel management system. The automated fuel system controls dispensing of fuel and tracks information about the transaction. It is activated by a 'memory key' which is issued to each vehicle driver. The memory key has a programmable chip containing driver and vehicle information. To obtain fuel the driver enters the key and the requested password and mileage information. The fuel system sends the transactions by fiber optics to a central controller. Each night, this data is complied into reports which show fuel use by vehicle and department as well as usage by site and the fuel inventory. This system helps the County track and manage the usage of vehicles, as well as ensuring that there is sufficient fuel at each fueling site.

1997 saw continued acquisition of public lands through the County's Open Lands Program. The Program purchases or protects land for open space and wildlife habitats. Trails and recreational areas are developed on portions of the land. Funded by a .25% dedicated sales tax, the program acquired two key properties in 1997. The first property is located along the scenic ridgeline that flanks the Fort Collins-Loveland urban corridor. The second property adds 177 acres to the existing recreational lands around Pinewood Reservoir. Also in 1997, the Open Lands staff organized several educational events designed to inform local landowners on topics such as conservation easements and preserving family lands.

On July 29, 1997, a devastating flood hit Fort Collins in Larimer County. Although County roads, foothills park trails and neighborhoods outside the city's limits suffered some damage, the worst of the flood was felt in Fort Collins. Five people lost their lives as a result of the flood. Emergency agencies from throughout the area responded immediately with the County's Emergency Management Services Unit through the Sheriff's office and the Health and Human Services Division in full response. In addition, County crews cleared and opened County roads, and Mental Health and Community Services, among other departments, assisted flood victims.

For the first time in our history, on July 30, 1997, the Larimer County Board of Commissioners declared a 'Local Emergency' paving the way for agencies and residents to file for State and Federal aid. Larimer County immediately created a web page on the County's web site, the Virtual Courthouse, to disseminate information. The County's Health Department provided information on safe drinking water, food safety, appropriate immunizations and other hazards. The Extension office and the Road and Bridge departments provided timely information. The County's Landfill offered free drop-offs for flood debris. The Employment and Training Services department developed an outreach plan for those who had lost their jobs due to the flood.

Weeks after the flood many residents were still in need of assistance. Larimer County played a key role in staffing a flood-relief center. Knowing that there were elderly residents who had suffered home damage and for a variety of reasons had not asked for help, the Community Services department responded with a target campaign to aid these people. The County's Building department worked for months after the flood with residents of rural neighborhoods on drainage issues. County staff worked long hours with Federal Emergency Management Agency (FEMA) and Fort Collins officials to receive needed aid. Nearly a year later the County continues work on repairs to foothills park trails.

Colorado's healthy economy is a mixed blessing to Larimer County. Along with the benefits of growth, the County is experiencing an increasing demand for services as well as intensifying pressure on existing infrastructure and facilities. This pressure heightened by the additional challenge of providing these programs and services within the provisions of the 1992 TABOR ('Taxpayer's Bill of Rights') State constitutional amendment. The amendment limits the growth rate of property tax and most other State and local revenues, and freezes all mill levies at a maximum of their 1992 rate, unless an increase is approved by the voters. It also mandates voter approval for any State or local multi-fiscal year obligation.

After five years of increasingly constrained operation under TABOR, County residents voted to remove the growth rate limitation on County revenues. In addition, the County is implementing a myriad of approaches to manage growth and respond to new demands. These include construction of new facilities, innovative land use planning, creation of special districts and alternative service delivery.

Providing convenient, cost effective services to citizens in a county as large as Larimer is a challenge. The County sees the Internet as one potential strategy to meet this challenge. Although the County has maintained a web site for a number of years, the site is gradually evolving from simply a source of general information into a "Virtual Courthouse" where citizens can transact business. Some of the new features added in 2000 allow citizens to:

• Research property records and recorded documents.
• Find out the assessed value and property taxes for over 116,000 parcels in the County.
• Sign up to received notification when the County issues requests for bids and proposals.
• Purchase annual park passes.
• Receive notifications for press releases, Commissioner meeting agendas, and meeting minutes.
• Submit a zoning violation complaint.

As the Internet matures and stabilizes, it is hoped that the County web site will help keep people off the roads, allow 24-hour accessibility to common services, and free up staff time.

The objective of an internal control structure is to provide reasonable, but not absolute, assurance as to the safeguarding of assets against loss from unauthorized use or disposition, and the reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes that the cost of a system of internal control should not exceed the benefits derived, and the evaluation of these factors necessarily requires estimates and judgments by management. All internal control structure evaluations occur within the above framework. We believe that the County's internal control structure adequately safeguards assets and provides reasonable assurance of proper recording of financial transactions.

The County adopts annual budgets by department for all governmental and proprietary funds., and the Public Trustee component unit. Budgets are requested and adopted on a line-item basis and controlled by the major object classifications of Personnel, Operating Costs, and Capital Outlay. The Operating Cost category, in addition to personnel and other operating expenditures and expenses, includes intergovernmental and debt service payments and operating transfers to other funds. Control is maintained by the two three categories at the division/department level in the General Fund and at the fund level in all other funds. Supplemental appropriations are approved by the Board of County Commissioners as needed during the year to provide for those items that were unknown or unforeseen at the time the budget was originally adopted. In 20007, one supplemental appropriation was adopted.

Encumbrance accounting is employed as an extension of formal budgetary integration. Purchase orders, contracts, and commitments are recorded in order to reserve that portion of the applicable appropriation. Encumbrances outstanding at year end are canceled.

Revenues. The following schedule presents a summary of governmental fund (General, Special Revenue, Debt Service, and Capital Projects Funds) revenues for the fiscal year ended December 31, 2000; and the amount and percentage of increases and decreases in relation to prior year revenues. Governmental-type Fiduciary funds are not included, since they include funds that are not available to the County for general operations.

Total governmental fund revenues increased by 9.3% in 2000. Taxes and intergovernmental revenues continued to be the major sources of County revenues. Some of the key changes in revenue between 1999 and 2000 are as follows:

• The tax revenue category posted the largest dollar increase (17.9%). Although the County's mill levy remained constant, the value of assessed property increased. In addition, a .1% sales tax for the acquisition of lands for a new Fairgrounds and Events Center was succeeded by a .15% tax dedicated towards building and maintaining a new fairgrounds.

• Between 1999 and 2000, assessment revenue decreased by 54.2%. Assessment revenue varies from year to year, as new assessments are created or paid off. The County uses special assessments to fund infrastructure improvements, such as roads and drainage, in unincorporated areas of the County.
• Interest income increased 41.7%. This increase resulted from having higher cash balances and improved market earning rates.
• The miscellaneous revenue category dropped almost 29.4% between 1999 and 2000. In 1999, over $2 million of miscellaneous revenue was contributed by the County's Mental Health program, and was used to support program services. The Mental Health program was transformed into a private non-profit entity at the end of 1999, so both revenues and expenditures of the program are no longer included in the County's financial statements.

The 'Charges for services' revenue category had the highest percentage increase. This increase is primarily attributed to inmate housing, building inspection and mental health fees. Revenues from assessments declined 16.57% from 1997, because there were no new special assessments levied in 1998 and several old assessments were completed. The formation of special assessment districts has historically provided Larimer County with an effective alternative to increased property taxes for road construction or other capital improvements. Bonds are sold to finance the improvements within a specified geographical area, and the bonds are then repaid over a number of years by levying assessments on the properties benefiting from the improvements. Certain provisions of the TABOR Amendment require a favorable vote of the property owners within the district for bonds to be sold and assessments to be levied.

Expenditures. The schedule below summarizes governmental fund (General, Special Revenue, Debt Service, and Capital Projects Funds) expenditures for fiscal years 2000 and 1999.

Expenditures for 2000 totaled $145.8 million, a modest $99.6 million, a 6.90% 2.8% increase over 1999. As in past years, health and human services is the largest single category ($35,799,178), representing almost one-fourththird of governmental fund expenditures. Significant changes in governmental fund expenditures included the following:

• General government expenditures increased by 12.5%. Costs of administering a presidential and major State election for County voters, and building maintenance for new County facilities triggered this increase.
• The recreation category decreased by 44.0% between 1999 and 2000. In 1999, the County purchased some valuable and strategic conservation easements. Fewer easement purchases occurred in 2000.
• The project expenditure category dropped 14.3% after the completion of a major stormwater basin project in 1999.
• The health and human services category showed an 8.2% decrease in operating expenditures because the County's Mental Health program became a private non-profit entity at the end of 1999.
• Capital outlay increases were generated by construction costs for public buildings under the County's Capital Expansion Program.
• Debt service expenditures increased by 45.1% because the County issued $15,000,000 in sales tax revenue bonds in 2000. Bond proceeds are dedicated to the purchase and improvement of open space.

The County's General Fund balance was $15.3 $6.8 million as of December 31, 2000. Of this amount, $17,518 is reserved for pre-paid expenditures, and $1.1 million $348,254 is reserved for emergencies and advances. The remaining $14.2 $6.4 million is designated by the Board for subsequent years' expenditures and other future purposes. The 2000 fund balance is $5.1 million higher than the previous year. The total fund balance is 30% 18% of 2000 General Fund operating expenditures plus net operating transfers. The County Commissioners' goal is to keep fund balance within the 10% - 15% range. The Board anticipates using some fund balance in 2001 for high priority projects and to even out the cyclical revenue growth which results from biennial property reassessments.

Enterprise Fund. Larimer County maintains a single enterprise fund, the Solid Waste Fund, which accounts for the County's solid and hazardous waste and recycling operations. The Larimer County Landfill received approximately 800 tons of trash per day in 2000.

The Natural Resources Department continued to evaluate replacement options for the landfill, which will reach its permitted capacity in 5 to 6 years. The Department conducted a landfill siting study and public attitude survey, but decisions on future plans were deferred until the new Board of County Commissioners took office in 2001. The Household Hazardous Waste Program removed over 1.5 million pounds of hazardous wastes from the waste stream in 2000. Approximately half of these materials were recycled. The remainder was disposed of at off-site hazardous waste facilities. The Larimer County Recycling Center processed an average of 120 tons of recyclables per day in 2000. Market prices paid for recyclables declined for most of the year.

Several customer service improvement projects were undertaken in 2000. Improvements to the recycling drop-off area and used oil tank were completed in the spring. A new automated lane for commercial trash haulers was installed and was operational in the early part of 2001. The operating season at the Red Feather Lakes Transfer station was extended to better serve year-round residents.

Enterprise Fund. Larimer County maintains a single enterprise fund, the Solid Waste Fund, which accounts for the County's landfill and recycling operations. The landfill received between 700 and 750 tons of refuse per day in 1998.

The landfill cashiering and accounting system was replaced with a program designed specifically to account for landfill volumes and revenue. This coincided with the replacement of the main gatehouse after more than 20 years of use. A small, dirt-floor building that can be used for a variety of projects completed the facility upgrade. The Household Hazardous Waste Program continued strong in 1998, developing an educational video which plays on local television and in classrooms and public presentations. The Hazardous Waste program branched out to conditionally exempt, small quantity generators (CESQG) of business hazardous waste. Over 200 businesses were served by the program in 1998.

The landfill's largest customer, a commercial trash hauler, began diverting 100% of their waste to their own landfill. This was a big and difficult change in revenue which will challenge the landfill for years to come. With the current expected life of the landfill at eight years, a Solid Waste Task Force was established to research future alternatives. They will continue working in 1999. A long-term liability to pay for closure and post closure care costs in accordance with Environmental Protection Agency requirements has been recorded in the Solid Waste Fund.

Operating revenues for this fund were $6,212,210, an increase of 115.2% over 19997. OOperating income for the period was $1,669,754.

Internal Service Funds. Larimer County's internal service funds include three operating departments and four self-insurance funds. The Print Shop provides supplies and central printing services to County departments. Telecommunications operates and maintains the internal phone system. Fleet Services provides vehicle and equipment maintenance and fuel to County departments. These three operating internal service departments generated a combined net loss of $147,908. All funds have positive fund equity.

The County is self-insured against certain losses and risks. The Dental, Unemployment, and Risk Management (Workers' Compensation and Property and Casualty) self-insurance funds had a combined loss of $152,239 $5,584. This is consistent with the County's policy of not building up surpluses in these funds. The Self-Insured Reserve Fund, which accounts for the accumulation of any surpluses generated and finances any deficits incurred in the self-insurance programs, closed out 2000 with $4.65 million $4,460,279 in fund equity. This balance is $128,239 higher than the previous year. represents a $251,509 increase (6%) over the previous year. The adequacy of workers' compensation and property and casualty reserves are actuarially determined.

The maximum personal injury limit is $150,000 per person and $600,000 per occurrence as stated in the Colorado Governmental Immunity Act. Property insurance is provided by a commercial insurance company. The policy has a $25,000 deductible and a limit of liability per occurrence of $125,000,000. In 2000, the County purchased commercial excess liability coverage with a $3,000,000 limit and a self-insured retention of $500,000. The self-insured workers' compensation liability is $300,000 per person. Any excess is covered by commercial insurance.

Larimer County has no general obligation bonded debt. Colorado Revised Statutes provide for a general obligation debt limit of 1.5% of assessed valuation. The County had a general obligation debt capacity of over $35 million in 2000.

At December 31, 2000, Larimer County had the following outstanding long-term debt:

Of the $79.84.9 million in long-term debt outstanding, only the first three items, totaling $346,677 are is funded from general revenues. The Larimer County Building Authority certificates of participation are funded by a .4% sales tax, which was approved by the voters in 1997. Open Lands debt is payable from a .25% sales tax which is dedicated to the purchase and maintenance of open space. The Solid Waste (an enterprise fund) capital lease will fund the cost of the capital lease agreement to construct the Recycling Center through the sale of recyclables and dumping fees at the landfill. Sp Special assessment bonds and notes arewill to be funded by payments from property owners benefiting from the capital improvements constructed with debt proceeds.

The County Treasurer, by State Statute, is responsible for the collection, distribution and investment of monies for most County funds. Cash temporarily idle during the year can be invested in obligations of the U.S. Treasury, agencies and instrumentalities, commercial paper, repurchase agreements, money market funds, and local government investment pools with a maturity date no more than five years from the date of purchase. The Treasurer uses pooled cash accounts for operating purposes in which all funds have an interest with the exception of the Public Trustee and agency checking accounts. The average yield on pooled investments was 5.7%.

Colorado law Revised Statutes requires that the County's financial statements be audited by annual audit be made of the financial affairs and transactions of all funds and activities for all local governments whose revenues or expenditures annually exceed $50,000. The audit is to be performed by an independent certified public accountant or firm of certified public accountants licensed to practice in the State of Colorado. In compliance with this Statute, the County engaged the firm of Anderson and Whitney, Certified Public Accountants, to conduct the audit for the year ended December 31, 2000. Anderson and Whitney has issued an unqualified opinion on the County's 2000 financial statements.

The County has adopted the "Single Audit concept" provided for in the Single Audit Act of 1984 and the Office of Management and Budget Circular A-133 for the audit of federally assisted programs. Results of the Single Audit are included in the Single Audit Schedules Section of this report.

The County's 2000 Comprehensive Annual Financial Report (CAFR) was prepared following the guidelines recommended by the

The Government Finance Officers Association of the United States and Canada (GFOA). GFOA awards Certificates of Achievement for Excellence in Financial Reporting to governmental units who publish an easily readable and efficiently organized CAFR that satisfies all legal requirements and conforms to generally accepted accounting principalscomprehensive annual financial report, the contents of which must conform to strict program standards. Such reports must satisfy both generally accepted accounting principles and applicable legal requirements. Larimer County has received eighteen consecutive Certificates of Achievement for its 1982 through 1999 CAFRs.Comprehensive Annual Financial Reports for fiscal years 1982 through 1997. Each Certificate is valid for a one-year period. of one year only. We believe our current report continues to conform to Certificate Program requirements, and we are submitting it to GFOA to determine its eligibility for another certificate.

Preparation of this Comprehensive Annual Financial Report was made possible by the dedicated and conscientious efforts of the entire staff of the Department of Accounting and Reporting. The Accounting Operations Section of the department ensures that transactions are processed and reported in an accurate and timely manner; the Financial Reporting Section has the direct responsibility for preparation of the CAFR in accordance with relevant guidelines and standards; and the Administrative Support Section turns scratches and scribbles into a professional and award-winning document. By working together as an interrelated, highly effective team, these individuals promote the excellence we strive for.

Appreciation is also expressed to the Board of County Commissioners who establish the policies which provide for sound financial management, and to all the other elected officials, division directors, department heads and County employees for their cooperation and assistance in matters pertaining to the financial affairs of the County and the preparation of this report.

Respectfully submitted,

Carol L. Block
Financial Services Director

Back to 2000 Financial Report