PPLD FY2023 Audited Financial Statements.pdf

POUGHKEEPSIE PUBLIC LIBRARY

DISTRICT, NEW YORK

Basic Financial Statements, Supplementary Information and

Independent Auditors’ Report

December 31, 2023

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT, NEW YORK

Table of Contents

Page

Independent Auditors’ Report 1 - 3

Management’s Discussion and Analysis 4 - 11

Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position 12

Statement of Activities 13

Fund Financial Statements:

Balance Sheet - Governmental Funds 14

Reconciliation of Balance Sheet - Governmental Funds to the

Statement of Net Position 15

Statement of Revenue, Expenditures and Changes in Fund

Balances - Governmental Funds 16

Reconciliation of the Statement of Revenue, Expenditures and

Changes in Fund Balances - Governmental Funds to the

Statement of Activities 17

Notes to Financial Statements 18 - 43

Required Supplemental Information:

Schedule of Revenue, Expenditures and Changes in Fund Balance -

Budget and Actual - General Fund 44

Schedule of District’s Proportionate Share of the Net Pension

Asset/Liability 45

Schedule of District’s Pension Contributions 46

Schedule of Changes in the District’s Total OPEB Liability and

Related Ratios 47

Other Supplementary Information:

Project-Length Schedule - Capital Projects Fund 48

INDEPENDENT AUDITORS’ REPORT

The Board of Trustees

Poughkeepsie Public Library District, New York:

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 the Poughkeepsie Public Library District, New York (the District), as of and for the year ended December 31, 2023, and the related notes to 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 for the year then ended in accordance with accounting principles generally accepted in the United States of America (GAAP).

Basis for Opinions

We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditors’

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with 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 twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

sschmid_EFPR17E New Stamp

Auditors’ 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 auditors’ 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 GAAS and 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 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 Supplemental Information

GAAP require that management’s discussion and analysis and the additional required supplemental information as listed in the table of contents 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 GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District’s basic financial statements. The accompanying other supplementary information as listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic 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 basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the other supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Williamsville, New York

April 24, 2024

Management’s Discussion and Analysis

Introduction

Our discussion and analysis of the Poughkeepsie Public Library District, New York’s (the District) financial performance provides readers an overview of the District’s financial activities for the year ended December 31, 2023. It is a summary of the District’s current financial activities based on facts, decisions and conditions. It is also based on the District’s government-wide and fund-based financial

The management’s discussion and analysis is required supplementary information that should be read in conjunction with the District’s financial statements.

Financial Highlights

The District’s net position (deficit) decreased from $(2,199,830) at December 31, 2022 to

$(3,742,898) at December 31, 2023. The District’s total governmental funds reported an ending fund balance of $1,066,823 compared to last year’s balance of $1,378,954. The District’s total bonded debt decreased from the prior year due to principal payments of $880,000.

The Governmental Accounting Standards Board (GASB) Statement No. 68 pronouncement (which was implemented as of December 31, 2015) established accounting and financial reporting requirements associated with the District’s participation in the cost-sharing multiple employer pension plan administered by the New York State and Local Employees’ Retirement System (ERS or the System). Under the standards, cost-sharing employers are required to report in their government-wide financial statements a net pension asset/liability, pension expense and pension-related deferred inflows and outflows of resources based on their proportionate share of the collective amounts of all of the municipalities in the plan. At December 31, 2023, the District reported in its statement of net position a net pension liability of $2,615,907 for its proportionate share of the ERS net pension liability. At December 31, 2022, the District reported a net pension asset of $957,898. The total ERS plan’s funding decreased from 103.65% in 2022 to 90.78% in 2023. More detailed information about the District’s pension plan reporting in accordance with the provisions of GASB Statement No. 68, including amounts reported as pension expense and deferred inflows/outflows of resources, is presented in note 3(e) in the notes to financial statements.

Overview of the Financial Statements

The financial report begins with management’s discussion and analysis which gives an overview of the District’s financial performance as of the date of the financial statements. It is intended to be an introduction to the financial statements. The statement of net position and the statement of activities provide information about the District’s activities and a long-term view of its financial position. The fund-financial statements provide detail of the District’s operations.

Management’s Discussion and Analysis, Continued

The financial statements also include notes that explain some of the information in the statements with more detailed data. The notes are necessary for fair presentation of the financial statements.

Required supplementary information provides further explanation and support for the financial

Statements of Net Position and Statements of Activities

The statement of net position and the statement of activities provide information about the District as a whole and its activities. These statements include all assets, deferred outflow of resources, liabilities and deferred inflows of resources using the accrual method of accounting. The statement of net position includes all of the District’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources. All of the current year’s revenue and expenses are accounted for in the statement of activities regardless of when cash is received or paid.

The two government-wide statements report the District’s net position and how it has changed. Net position, the District’s assets and deferred outflows of resources minus its liabilities and deferred inflows of resources, is one way to measure the District’s financial position over time. To assess the

District’s overall financial health, other non-financial factors need to be considered, such as changes in the tax base and condition of or improvements to buildings.

Fund-Financial Statements

The fund-financial statements provide detailed information about the District’s major funds, not the

District as a whole. The District’s services are reported in governmental funds, which focus on how money flows into and out of these funds and the balances left at year-end. These funds are reported using the modified accrual basis of accounting. This provides a short-term view of the District’s general operations and services it provides. The District maintains five individual government funds

(General Fund, Capital Projects Fund, Special Revenue Fund, Permanent Fund and Debt Service

Fund). The reconciliation statements explain the relationship between the governmental funds (short term view) and the statement of net position and statement of activities (overall financial position).

Financial Analysis of the District as a Whole

These statements include all assets, deferred outflows, liabilities, and deferred inflows using the full accrual basis of accounting, showing all of the current year activity regardless of when cash was received or paid. The District’s net position (deficit) decreased by $1,543,068. A comparative analysis is presented on the next page.

Statements of Net Position - Governmental Activities

2023 2022 Change

Current and other assets 1,691,752$ 2,928,357 (1,236,605)

Capital assets, net 17,904,029 18,455,102 (551,073)

Total assets 19,595,781 21,383,459 (1,787,678)

Deferred outflows of resources 4,607,388 5,834,770 (1,227,382)

Current liabilities 694,079 665,905 28,174

Long-term liabilities 23,849,684 22,157,801 1,691,883

Total liabilities 24,543,763 22,823,706 1,720,057

Deferred inflows of resources 3,402,304 6,594,353 (3,192,049)

Net position (deficit):

Net investment in capital assets 6,712,233 7,365,026 (652,793)

Restricted 561,439 525,818 35,621

Unrestricted (deficit) (11,016,570) (10,090,674) (925,896)

Total net position (deficit) (3,742,898)$ (2,199,830) (1,543,068)

• Current and other assets decreased $1,236,605 as the net pension asset became a liability which was offset by an increase in cash and equivalents.

• Capital assets, net decreased $551,073 as depreciation expense of $861,027 exceeded additions of $309,954 as presented in note 3(c).

• Deferred outflows of resources decreased $1,227,382 from actuarily determined changes in the

District’s proportionate share of the ERS net pension liability and the total other postemployment benefits (OPEB) liability.

• Current liabilities increased $28,174 from increases in amounts due ERS of $66,375 and accrued liabilities of $15,591 which was offset by decreases in accounts payable of $48,542, and accrued interest of $5,250.

• Long-term liabilities increased $1,691,883 primarily from an increase in the actuarily determined net pension liability of $2,615,907 which was offset by a decrease in bonds payable of $880,000.

• Deferred inflows of resources decreased $3,192,049 primarily from actuarily determined changes to the net pension liability which decreased related deferred inflows by $3,155,284.

Program revenue:

Charges for services 89,780$ 70,793 18,987

Operating grants and contributions 1,106,208 1,100,267 5,941

Capital grants 35,562 2,644 32,918

Total program revenue 1,231,550 1,173,704 57,846

General revenue:

Property taxes 8,489,461 8,268,345 221,116

Other tax items 205,424 166,397 39,027

Use of money and property 67,325 10,437 56,888

Miscellaneous - 16,393 (16,393)

Total general revenue 8,762,210 8,461,572 300,638

Total revenue 9,993,760 9,635,276 358,484

Expenses:

Culture and recreation 11,137,240 8,893,480 2,243,760

Interest 399,588 470,323 (70,735)

Total expenses 11,536,828 9,363,803 2,173,025

Change in net position (1,543,068)$ 271,473 (1,814,541)

Statements of Activities - Governmental Activities

• General revenue, including tax revenue, use of money and property, and state, county and federal sources, primarily supports the cost of providing services. Local property taxes constituted 96.9% of the District’s total revenue in 2023. In 2022 it was 85.8%.

• Culture and recreation expenses increased $2,243,760 as net changes in the District’s proportionate share of the ERS net pension liability and the total OPEB liability were more than the prior year.

• Since the District must rely heavily on voter approval for funding levels, management of the resources is of paramount concern to the District’s administration and the voting public.

Library District’s Government Funds

The total assets and liabilities of the District changed from 2022 to 2023 as follows:

Assets:

General fund 1,051,327$ 1,465,200 (413,873)

Capital projects fund 35,266 35,253 13

Special revenue fund 1,028,243 482,029 546,214

Permanent funds 492,531 478,818 13,713

Debt service fund 153,347 234,408 (81,061)

Total assets 2,760,714$ 2,695,708 65,006

Liabilities:

General fund 954,929 591,505 363,424

Capital projects fund 58,098 58,098 -

Special revenue fund 667,151 667,151 -

Permanent fund 13,713 - 13,713

Total liabilities 1,693,891 1,316,754 377,137

Fund balance (deficit):

General fund 96,398 873,695 (777,297)

Capital projects fund (22,832) (22,845) 13

Special revenue fund 361,092 (185,122) 546,214

Permanent funds 478,818 478,818 -

Debt service fund 153,347 234,408 (81,061)

Total fund balance 1,066,823 1,378,954 (312,131)

Total liabilities and fund balance 2,760,714$ 2,695,708 65,006

As shown in the table above, total assets and total liabilities increased. In the general fund, assets decreased due to the use of cash and equivalents for operations and a decrease in interfund receivables.

Assets in the special revenue fund increased primarily from an increase in interfund receivables. The general fund fund balance is $96,398 and approximately 1.1% of its final operating budget of

$9,098,638, exclusive of debt service of $1,338,400. The NYS Government Finance Officers

Association and the NYS Comptroller’s Office recommend a two month budget reserve as insurance against unanticipated expenditures or revenue shortfalls. The District’s fund balance is less than the recommended two months of expenditures. Efforts will be made in the coming years to rebuild it.

Total governmental funds revenue and expenditures changed from 2022 to 2023 as follows:

Revenue:

Real property taxes 8,489,461$ 8,268,345 221,116

Other tax items 205,424 166,397 39,027

Departmental income 24,674 31,001 (6,327)

Use of money and property 116,601 20,765 95,836

State aid 268,454 288,057 (19,603)

Local sources 23,563 14,909 8,654

Gifts and donations 260,851 164,467 96,384

Miscellaneous local sources 604,732 681,335 (76,603)

Total revenue 9,993,760 9,635,276 358,484

Expenditures:

Personal services 4,592,426 4,498,588 93,838

Equipment 88,702 106,131 (17,429)

Contractual 2,108,985 2,315,820 (206,835)

Employee benefits 2,177,378 1,954,200 223,178

Debt service 1,338,400 1,334,238 4,162

Capital outlay - 3,750 (3,750)

Total expenditures 10,305,891 10,212,727 93,164

Excess (deficiency) of revenue over expenditures (312,131) (577,451) 265,320

Other financing sources (uses):

Interfund transfers in 103,144 1,108,330 (1,005,186)

Interfund transfers out (103,144) (1,108,330) 1,005,186

Total other financing sources (uses) - - -

Change in fund balance (312,131)$ (577,451) 265,320

Financial Analysis of the District’s Funds

General Fund Budgetary Highlights

The District’s budget is prepared in accordance with New York State statute and is based upon the modified accrual basis of accounting. The measurement focus is consistent with recognition of cash, assets and liabilities as well as those assets and liabilities that can be readily converted into cash within a reasonable period of time. This method utilizes cash receipts, disbursements and encumbrances. The only legally adopted budget in the District is the budget for the general fund.

The governmental funds report a combined deficiency of revenue over expenditures of $312,131.

Revenue increased $358,484 or 3.7% from the prior year. This was primarily from an increase in real property taxes of $221,116.

Expenditures increased $93,164 or 0.9%. This was primarily caused by increased costs for salaries of $93,838 and benefits of $223,178. These increases were offset by a decrease in contractual expenditures of $206,835.

Capital Asset and Debt Administration

Capital Assets

The District capitalized $236,978 of library materials and $72,976 of equipment in 2023. Equipment capitalized consisted of computer equipment and furniture. Depreciation expense for 2023 was

$861,027. Additional detail is provided in note 3(c).

Debt

The District ended 2023 with no balance on its tax anticipation letter of credit, but extended the agreement until 2024.

Notable Events of 2023

• While 2022 witnessed continued surge in usage of digital content, in 2023 the use of traditional print and AV materials rebounded. We anticipate this to become a trend and that overall usage of District materials, both digital and traditional, will continue to grow in 2024 and 2025.

• Deployment of the District’s bookmobile continues to grow along with the variety of service organizations wishing to collaborate. In late 2023, we were finally able to coordinate routine stops at four local supermarkets. This has been well-received by the public.

• The District continues to benefit from the generosity of the voters as they continue to support the annual budget referendum by a comfortable margin and private donors continue to recognize the value of public library services through their continued donations.

• Use of the newest branch library, the Sadie Peterson African Roots Branch Library, continues to be low. This is partially attributed to the ongoing construction in the rental property, which was concluded in early 2024.

• Collaborations continued with the Bardavon, the Jewish Federation of Dutchess County, the local school districts (Poughkeepsie City School District, in particular), Dutchess County, and local non-profits.

• Installation of free parks wi-fi is ongoing with the City and Town of Poughkeepsie and with

Dutchess County.

• The District hosted its third annual book festival at Dutchess Community College in April

2023. Over 1100 people attended the event which featured 60 authors. The event in 2024 was on March 30 and hosted over 100 authors with over 1400 people attending.

Economic Factors Bearing on the Library District’s Future

The District’s management considers many factors when setting the 2025 budget. Such factors include:

• The budget and funding processes need to address how to best fund unexpected increases in contractual benefits offered to staff, especially health insurance and retirement costs.

• The workforce continues to change as more staff reach retirement age. Onboarding, training, and retaining new staff continues to be a challenge for the organization.

• The District is not immune to the pressures of inflation. We were especially hard hit in fuel expenses in 2023 and expect that to be a trend in 2024 and beyond.

Contacting the District’s Financial Management

This financial report is designed to provide our citizens, taxpayers, customers, 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 questions about this report or need additional financial information, contact the Administrative Office, Poughkeepsie Public Library District, New York, 93 Market Street, Poughkeepsie, New York 12601.

Governmental

Activities

Assets:

Cash and equivalents 1,163,229$

Investments 475,919

Accounts receivable 52,604

Capital assets:

Not being depreciated 1,341,009

Being depreciated, net 16,563,020

Total assets 19,595,781

Deferred outflows of resources 4,607,388

Liabilities:

Accounts payable 7,488

Accrued liabilities 217,387

Due to retirement system 400,054

Accrued interest payable 69,150

Non-current liabilities:

Due within one year 920,413

Due in more than one year 22,929,271

Total liabilities 24,543,763

Deferred inflows of resources 3,402,304

Net position (deficit):

Net investment in capital assets 6,712,233

Restricted 561,439

Unrestricted (deficit) (11,016,570)

Total net position (deficit) (3,742,898)$

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT, NEW YORK

Statement of Net Position

Net (Expense)

Operating Capital Revenue and

Charges for Grants and Grants and Changes in

Functions/Programs Expenses Services Contributions Contributions Net Position

Governmental activities:

Culture and recreation 11,137,240$ 89,780 1,106,208 16,623 (9,924,629)

Interest 399,588 - - 18,939 (380,649)

Total governmental activities 11,536,828$ 89,780 1,106,208 35,562 (10,305,278)

General revenue:

Real property taxes 8,489,461

Other tax items 205,424

Unrestricted use of money and property 67,325

Total general revenue 8,762,210

Change in net position (1,543,068)

Net position (deficit) at beginning of year (2,199,830)

Net position (deficit) at end of year (3,742,898)$

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT, NEW YORK

Statement of Activities

Year ended December 31, 2023

Total

Capital Special Debt Governmental

General Projects Revenue Permanent Service Funds

Assets:

Cash and equivalents 504,746$ 630 529,315 - 128,538 1,163,229

Investments - - - 475,919 - 475,919

Receivables:

Accounts 52,604 - - - - 52,604

Due from other funds 493,977 34,636 498,928 16,612 24,809 1,068,962

Total receivables 546,581 34,636 498,928 16,612 24,809 1,121,566

Total assets 1,051,327$ 35,266 1,028,243 492,531 153,347 2,760,714

Liabilities and fund balances:

Liabilities:

Accounts payable 7,488 - - - - 7,488

Accrued liabilities 217,387 - - - - 217,387

Due to retirement system 400,054 - - - - 400,054

Due to other funds 330,000 58,098 667,151 13,713 - 1,068,962

Total liabilities 954,929 58,098 667,151 13,713 - 1,693,891

Fund balances (deficit):

Nonspendable - - - 478,818 - 478,818

Restricted 47,000 - 361,092 - 153,347 561,439

Assigned 757,454 - - - - 757,454

Unassigned (708,056) (22,832) - - - (730,888)

Total fund balances (deficit) 96,398 (22,832) 361,092 478,818 153,347 1,066,823

Total liabilities and fund balances (deficit) 1,051,327$ 35,266 1,028,243 492,531 153,347 2,760,714

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT

Balance Sheet - Governmental Funds

Total governmental fund balances 1,066,823$

Amounts reported for governmental activities in the statement of net position are different because:

Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. 17,904,029

Governmental funds do not report the effect of assets or liabilities related to pension obligations whereas these amounts are deferred and amortized in the statement of activities.

Deferred outflows of resources - pensions 2,124,309

Deferred inflows of resources - pensions (102,874)

Deferred outflows of resources - OPEB 2,438,585

Deferred inflows of resources - OPEB (3,299,430)

Deferred amounts on refunding bonds 44,494

Long-term liabilities that are not due and payable in the current period are not reported in the funds.

Accrued interest payable (69,150)

Bonds payable (10,944,295)

Deferred payment plan (413)

Compensated absences (605,818)

Net pension liability (2,615,907)

Total OPEB liability (9,683,251)

Net position - governmental activities (3,742,898)$

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT

Reconciliation of Balance Sheet - Governmental Funds to the

December 31, 2023

Statement of Net Position

Total

Capital Special Governmental

General Projects Revenue Permanent Debt Service Funds

Revenue:

Real property taxes 8,489,461$ - - - - 8,489,461

Other tax items 205,424 - - - - 205,424

Departmental income 24,674 - - - - 24,674

Use of money and property 67,325 13 30,324 - 18,939 116,601

State aid 268,454 - - - - 268,454

Local sources 23,563 - - - - 23,563

Gifts and donations 260,851 - - - - 260,851

Miscellaneous 91,986 - 512,746 - - 604,732

Total revenue 9,431,738 13 543,070 - 18,939 9,993,760

Expenditures:

Current:

Personal services 4,592,426 - - - - 4,592,426

Equipment 88,702 - - - - 88,702

Contractual 2,108,985 - - - - 2,108,985

Employee benefits 2,177,378 - - - - 2,177,378

Debt service:

Principal 880,000 - - - - 880,000

Interest 458,400 - - - - 458,400

Total expenditures 10,305,891 - - - - 10,305,891

Excess (deficiency) of revenue over expenditures (874,153) 13 543,070 - 18,939 (312,131)

Other financing sources (uses):

Transfers in 100,000 - 3,144 - - 103,144

Transfers out (3,144) - - - (100,000) (103,144)

Total other financing sources (uses) 96,856 - 3,144 - (100,000) -

Net change in fund balances (777,297) 13 546,214 - (81,061) (312,131)

Fund balances (deficit) at beginning of year 873,695 (22,845) (185,122) 478,818 234,408 1,378,954

Fund balances (deficit) at end of year 96,398$ (22,832) 361,092 478,818 153,347 1,066,823

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT

Statement of Revenue, Expenditures and Changes in Fund Balances - Governmental Funds

Net change in fund balances (312,131)$

Amounts reported for governmental activities in the statement of activities are different because:

Changes in long-term assets are recognized in the statement of activities but not in the governmental funds - net pension asset. (957,898)

Governmental funds report capital outlay as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense.

Capital outlay expenditures 309,954$

Depreciation expense (861,027) (551,073)

Bond proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of 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.

Principal paid on bonds 880,000

Amortization of loss on refunding bonds and issuance premium 59,696

Principal paid on deferred payment plan 4,956 944,652

Changes in deferred outflows of resources and deferred inflow of resources related to long-term liabilities are recognized in the statement of activities but not in the governmental funds.

Deferred outflows of resources - pensions (65,505)

Deferred inflows of resources - pensions 3,155,284

Deferred outflows of resources - OPEB (1,155,743)

Deferred inflows of resources - OPEB 36,765

Deferred amounts on refunding bonds (6,134) 1,964,667

Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.

Accrued interest 5,250

Compensated absences (43,240)

Pension obligations (2,615,907)

Total OPEB liability 22,612 (2,631,285)

Change in net position - governmental activities (1,543,068)$

See accompanying notes to financial statements.

POUGHKEEPSIE PUBLIC LIBRARY DISTRICT

Reconciliation of the Statement of Revenue, Expenditures and

Changes in Fund Balances - Governmental Funds to the Statement of Activities

Notes to Financial Statements

(1) Summary of Significant Accounting Policies

The Poughkeepsie Public Library District, New York (the District) was established in 1987 and operates in accordance with the applicable laws of the State of New York (the State). The

Board of Trustees (the Board) is the legislative body responsible for overall operation of the

District and is elected by the voters of the District. The Executive Director serves as the chief executive officer.

The accounting policies of the District conform to generally accepted accounting principles

(GAAP) as applicable to governmental units and the Uniform System of Accounts as prescribed by the State. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the District’s more significant accounting policies:

(a) Financial Reporting Entity

The financial reporting entity consists of (a) the primary government, which is the District,

(b) organizations for which the District is financially accountable and (c) other 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 as set forth by GASB.

In evaluating how to define the District, for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit in the District’s reporting entity was made by applying the criteria set forth by GASB including legal standing, fiscal dependency and financial accountability. Based upon the application of these criteria, there are no other entities which would be included in the financial statements.

(b) Government-Wide Financial Statements

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all non-fiduciary activities of the District as a whole. For the most part, the effect of interfund activity has been removed from these statements, except for interfund services provided and used.

The statement of net position presents the financial position of the District at the end of its fiscal year. The statement of activities demonstrates the degree to which direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenue includes

(1) charges to customers or applicants who purchase, use or directly benefit from goods or services, or privileges provided by a given function or segment, (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment and (3) interest earned on grants that is required to be used to support a particular program. Other items not identified as program revenue is reported as general revenue. The District does not allocate indirect expenses to functions in the statement of activities.

Notes to Financial Statements, Continued

(1) Summary of Significant Accounting Policies, Continued

(c) Fund Financial Statements

The accounts of the District are organized and operated on the basis of funds. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts which comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund balance, revenue and expenditures. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance related legal and contractual provisions. The District maintains the minimum number of funds consistent with legal and managerial requirements. The focus of governmental fund financial statements is on major funds as that term is defined in professional pronouncements. Each major fund is to be presented in a separate column, with non-major funds, if any, aggregated and presented in a single column. Since the governmental fund statements are presented on a different measurement focus and basis of accounting than the government-wide statements’ governmental activities column, a reconciliation is presented on the pages following, which briefly explain the adjustments necessary to transform the fund based financial statements into the government-wide presentation.

Fund Categories

Governmental Funds - Governmental funds are those through which most general government functions are financed. The acquisition, use and balances of expendable financial resources and the related liabilities are accounted for through governmental funds. The following represents the District’s major governmental funds:

General Fund - The general fund constitutes the primary operating fund of the District and is used to account for and report all financial resources not accounted for and reported in another fund.

Capital Projects Fund - The capital projects fund is used to account for and report financial resources that are restricted, committed or assigned for capital outlays, including the acquisition or construction of major capital facilities and other capital assets.

Special Revenue Fund - The special revenue fund is used to account for and report the proceeds of specific revenue sources that are restricted, committed or assigned to expenditures for specified purposes other than debt service or capital projects.

Permanent Fund - The permanent fund is used to account for assets that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support the District’s programs. Investment income earned on these funds is reported in the special revenue fund.

Debt Service Fund - The debt service fund is used to account for and report financial resources that are restricted, committed or assigned to expenditures for principal and interest, and for financial resources that are being accumulated for principal and interest maturing in future years.

(d) Measurement Focus, Basis of Accounting and Financial Statement Presentation

The accounting and financial reporting treatment is determined by the measurement focus and basis of accounting. Measurement focus indicates the type of resources being measured such as current financial resources (current assets less current liabilities) or economic resources (all assets and liabilities). The basis of accounting indicates the timing of transactions or events for recognition in the financial statements.

The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenue is recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenue is recognized as soon as it is both measurable and available. Revenue is considered to be available when it is collectible within the current period or soon enough thereafter to pay liabilities of the current period. Property taxes are considered to be available if collected within sixty days of the fiscal year end. If expenditures are the prime factor for determining eligibility, revenue from Federal and State grants are recognized as revenue when the expenditure is made. A ninety day availability period is generally used for revenue recognition for most other governmental fund revenue. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences, the net pension asset/liability and total

OPEB liability are recorded only when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. Issuance of long-term debt and acquisitions under capital leases are reported as other financing sources.

(e) Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund

Balances

Cash and Equivalents, Investments and Risk Disclosure

Cash and Equivalents - Cash and equivalents consist of funds deposited in demand deposit accounts, time deposit accounts and short-term investments with original maturities of less than three months from the date of acquisition.

The District’s deposits and investment policies are governed by State statutes. The District has adopted its own written investment policy which provides for the deposit of funds in FDIC insured commercial banks or trust companies located within the State. The

District is authorized to use demand deposit accounts, time deposit accounts and certificates of deposit.

Balances, Continued

Cash and Equivalents, Investments and Risk Disclosure, Continued

Collateral is required for demand deposit accounts, time deposit accounts and certificates of deposit at 100% of all deposits not covered by Federal deposit insurance. The

District has entered into custodial agreements with the various banks which hold their deposits. These agreements authorize the obligations that may be pledged as collateral. Such obligations include, among other instruments, obligations of the

United States and its agencies and obligations of the State and its municipal and school district subdivisions.

Investments - Permissible investments include obligations of the U.S. Treasury, U.S.

Agencies, repurchase agreements and obligations of New York State or its political subdivisions.

The District follows the provisions of GASB Statement No. 72 - “Fair Value

Measurements and Application,” which defines fair value and establishes a fair value hierarchy organized into three levels based upon the input assumptions used in pricing assets. Level 1 inputs have the highest reliability and are related to assets with unadjusted quoted prices in active markets. Level 2 inputs relate to assets with other than quoted prices in active markets which may include quoted prices for similar assets or liabilities or other inputs which can be corroborated by observable market data.

Level 3 inputs are unobservable inputs and are used to the extent that observable inputs do not exist.

Risk Disclosure

Interest Rate Risk - Interest rate risk is the risk that the government will incur losses in fair value caused by changing interest rates. The District does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from changing interest rates.

Custodial Credit Risk - Custodial risk is the risk that in the event of a bank failure, the

Library’s deposits may not be returned to it. GASB Statement No. 40 - “Deposits and

Investments Risk Disclosures - an amendment of GASB Statement No. 3”, directs that deposits be disclosed as exposed to custodial risk if they are not covered by depository insurance and the deposits are either uncollateralized, collateralized by securities held by the pledging financial institution or collateralized by securities held by the pledging financial institution’s trust department but not in the District’s name. The District’s aggregate bank balances that were not covered by depository insurance were not exposed to custodial risk at December 31, 2023.

Credit Risk - Credit risk is the risk that an issuer or other counterparty will not fulfill its specific obligation even without the entity’s complete failure. The District does not have a formal credit risk policy other than restrictions to obligations allowable under

General Municipal Law of the State of New York (NYS GML).

Risk Disclosure, Continued

Concentration of Credit Risk - Concentration of credit risk is the risk attributed to the magnitude of a government’s investments in a single issuer. The District’s investment policy limits the amount on deposit at each of its banking institutions.

Taxes Receivable - Real property taxes attach as an enforceable lien on real property as of

January 1st and are levied and payable by April 1st. The City of Poughkeepsie, New York

(the City) and the Town of Poughkeepsie, New York (the Town) are responsible for the billing and collection of the taxes. The City and the Town guarantee the full payment of the District’s warrant and assumes responsibility for uncollected taxes.

Accounts Receivables - Accounts receivables include amounts due from other governments and individuals for services provided by the District. Receivables are recorded and revenues recognized as earned or as specific program expenditures/expenses are incurred.

Allowances are recorded when appropriate.

Due From/To Other Funds - During the course of its operations, the District has numerous transactions between funds to finance operations, provide services and construct assets.

To the extent that certain transactions between funds had not been paid or received as of

December 31, 2023, balances of interfund amounts receivable or payable have been recorded in the fund financial statements.

Inventory - There are no inventory values presented in the balance sheets of the respective funds of the District. Purchases of inventoriable items are recorded as expenditures at the

Capital Assets - Capital assets, which include property, plant and equipment, are reported in the governmental activities column in the government-wide financial statements. Capital assets are defined by the District as assets with an initial cost of more than $5,000 and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation.

Major outlays for capital assets and improvements are capitalized as projects are constructed. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives is not capitalized.

The costs associated with the acquisition or construction of capital assets are shown as expenditures in the governmental fund financial statements. Capital assets are not shown on the governmental fund balance sheets.

Land and construction-in-progress are not depreciated. Property, plant and equipment of the District are depreciated using the straight line method over the following estimated useful lives.

Class Life in Years

Buildings and improvements 50

Equipment 5 - 25

Library books 5

Deferred Outflows/Inflows of Resources - In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of net position that applies to a future period and so will not be recognized as an outflow of resources

(expense/expenditure) until then.

In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net position that applies to a future period and so will not be recognized as an inflow of resources (revenue) until that time.

Deferred outflows and inflows of resources have been reported on the government-wide statement of net position for the following:

Governmental Activities

Deferred Deferred

Outflows of Inflows of

Resources Resources

Deferred loss on refunding bonds $ 44,494 -

Net pension liability 2,124,309 102,874

Total OPEB liability 2,438,585 3,299,430

$ 4,607,388 3,402,304

The District reported deferred outflows of resources for a deferred loss on refunding bonds.

This amount results from the difference in the carrying value of the refunded debt and its reacquisition price. This amount is being deferred and amortized over the shorter of the life of the refunded or refunding debt.

The District reports deferred outflows of resources and deferred inflows of resources in relation to the net pension asset and total OPEB liability. These amounts are detailed in note 3(e).

Long-Term Liabilities - In the government-wide financial statements, long-term debt and other long term liabilities are reported as liabilities in the statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are expended as incurred.

In the fund financial statements, governmental funds recognize bond premiums and discounts, as well as bond issuance costs, 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 received, are reported as capital projects fund expenditures.

Compensated Absences - The collective bargaining agreements provide for the payment of accumulated vacation and sick leave upon separation from service. The liability for such accumulated time is reflected in the government-wide statement of net position as current and long term liabilities. A liability for these amounts is reported in the governmental funds only if the liability has matured through employee resignation or retirement. The liability for compensated absences includes salary related payments, where applicable.

Net Position - Net position represents the difference between assets, deferred outflows of resources, liabilities and deferred inflows of resources. Net position is reported as restricted when there are limitations imposed on its use either through the enabling legislation adopted by the District or through external restrictions imposed by creditors, grantors, or laws or regulations of other governments. Net position on the statement of net position includes, net investment in capital assets, restricted for permanent fund and debt service. The remaining balance is classified as unrestricted.

Fund Balance - Generally, fund balance represents the difference between current assets and deferred outflows of resources and current liabilities and deferred…