FY2016 CCDOA Financial Report as of 6302016.pdf - page 31

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With the implementation of GASB 72, the Department is now required to record its interest rate swaps at fair value.
As of June 30, 2016, the interest rate swaps had a fair value of $35.6 million. The information needed to restate the
interest rate swaps at fair value as of June 30, 2015, as required under GASB 72, was not available; therefore, the
interest rate swaps for FY 2015 are presented at their mark-to-market value, $43.4 million, based on the provisions of
GASB Statement No. 53,
Accounting and Financial Reporting for Derivative Instruments
("GASB 53").
Prepaid expenses consist of bond insurance costs for insured bonds and the unamortized lease cost of the
Consolidated Rental Car Facility. The bond insurance costs are being amortized over the terms of the bond
insurance policies. The unamortized Consolidated Rental Car Facility lease cost entails amounts due from the
Signatory Airlines on June 30, 2007, that were forgiven in FY 2008 in exchange for the net revenues (excluding land
rent) from the Consolidated Rental Car Facility. The Agreement provides for the Consolidated Rental Car Facility
lease cost to be amortized over the period of the lease agreement with the rental car facility tenants, a term of ten
years. The balance of prepaid expenses for FY 2016 declined $3.1 million over FY 2015 from $7.7 million to $4.6
million, mostly due to scheduled amortization.
Deferred Outflows of Resources
As of June 30, 2016, the Department recorded deferred outflow of resources related to the pension plan in the
amount of $24.0 million, an increase of $3.2 million, or 15.2 percent, over the prior fiscal year figure of $20.9 million.
For FY 2016, the deferred outflow related to the pension plan comprised $21.9 million in contributions to the pension
plan and $2.1 million related to changes in proportions as opposed to $19.7 million in contributions to the pension
plan and $1.2 million related to changes in proportions for FY 2015. The increase in changes in proportions as of
June 30, 2016, as compared to June 30, 2015, is attributable to the difference in FY 2015 between employer
contributions, and proportionate share of contributions, for a total increase of $2.3 million, and offset by scheduled
amortization. The changes in proportions has remaining amortization terms of 4.7 years and 5.55 years for FY 2014
cost and FY 2015 costs, respectively. Refer to Note 5, "Retirement Plans," for more details.
Under the provisions of GASB 53, the Department is required to record the changes in the fair value or the mark-to-
market value of its interest rate swaps serving as hedging derivatives. With the implementation of GASB 72, the
interest rate swaps that were hedging derivative instruments now are stated at fair value. As of June 30, 2016, the
deferred outflows of resources associated with hedging derivative instruments had a fair value of $75.8 million. The
information required to restate the interest rate swaps that were hedging derivative instruments at fair value as of
June 30, 2015, was not available; therefore, the interest rate swaps are presented at their mark-to-market value for
FY 2015. As of June 30, 2015, the deferred outflows of resources associated with hedging derivative instruments had
a mark-to-market value of $52.3 million. Refer to Note 10, "Derivative Instruments – Interest Rate Swaps," for
additional details.
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