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AURORA METROPOLITAN EXPOSITION,

AUDITORIUM AND OFFICE BUILDING AUTHORITY

(AURORA CIVIC CENTER AUTHORITY)

AURORA, ILLINOIS

ANNUAL FINANCIAL REPORT

For the Year Ended

June 30, 2015




AURORA, ILLINOIS

TABLE OF CONTENTS

Page(s)

INDEPENDENT AUDITOR’S REPORT .................................................................... 1-2

GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS

Management’s Discussion and Analysis .................................................................. MD&A 1-4

Basic Financial Statements

Statement of Net Position .................................................................................... 3-4

Statement of Revenues, Expenses and Changes in Net Position ........................ 5

Statement of Cash Flows ..................................................................................... 6-7

Notes to Financial Statements ............................................................................. 8-15

SUPPLEMENTARY INFORMATION

Combining Schedule of Revenues - Enterprise Fund .............................................. 16

Combining Schedule of Expenses - Enterprise Fund ............................................... 17

GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS

MD&A 1

Management’s Discussion and Analysis

The management of the Aurora Civic Center Authority offers readers of our financial statements

the following narrative overview and analysis of our financial activities for the years ended

June 30, 2015 and June 30, 2014.

Basic Financial Statements

Our basic financial statements are prepared using enterprise fund accounting that uses the same

basis of accounting as private-sector business enterprises. The Aurora Civic Center Authority is

operated under one enterprise fund, with a component unit. Under this method of accounting an

economic resources measurement focus and an accrual basis of accounting is used. Revenue is

recorded when earned and expenses are recorded when incurred. The basic financial statements

include a statement of net position; a statement of revenues, expenses, and changes in net

position; and a statement of cash flows. These statements are followed by notes to the financial

statements. In addition to the basic financial statements, this report also contains supplementary

information in the form of a statement of revenues and a statement of expenses separated by the

three divisions of the Aurora Civic Center Authority as follows: Paramount Theatre, North Island

Center and the Aurora Civic Center Authority.

The statement of net position presents information on the assets and liabilities, with the

difference between the two reported as net position. Over time, increases or decreases in net

position may serve as a useful indicator of whether the financial position of the Authority is

improving or deteriorating.

The statement of revenues, expenses, and changes in net position reports the operating revenues

and expenses and nonoperating revenue and expenses of the Aurora Civic Center Authority for

the fiscal year with the difference – the net income or loss – being combined with any capital

contributions to determine the year end net position at the end of the fiscal year.

The statement of cash flows reports cash and cash equivalent activities for the fiscal year

resulting from; operating activities, noncapital financing activities, capital and related financing

activities, and investing activities. The net result of these activities added to the beginning of the

year cash balance reconciles to the cash and cash equivalent balance at the end of the current

fiscal year. Contrary to the other basic financial statements, this statement is prepared on a cash

basis.

Financial Highlights

Assets exceeded liabilities by $22,327,176 (net position) at the close of the fiscal year. Of this

amount, $1,811,014 is unrestricted and available to meet ongoing and future obligations of the

Aurora Civic Center Authority including its capital projects.

Net position increased $609,179. The net investment in capital assets increased $133,865 and

unrestricted net position increased by $475,314.

MD&A 2

Financial Highlights (Continued)

The Statement of Cash Flows, that identifies the sources and uses of cash activity for the fiscal

year, indicates cash and cash equivalents increased a net of $1,509,391 for the year.

Financial Information

Net Position

June 30,

2015

June 30,

2014

Increase/

(Decrease)

Current and other assets $ 7,608,246 $ 6,413,103 $ 1,195,143

Capital assets 20,766,162 20,732,297 33,865

Total assets 28,374,408 27,145,400 1,229,008

Current liabilities 5,783,632 5,134,935 648,697

Long-term liabilities 263,600 292,468 (28,868)

Total liabilities 6,047,232 5,427,403 619,829

Net position:

Net investment in capital assets 20,516,162 20,382,297 133,865

Unrestricted 1,811,014 1,335,700 475,314

Total net position $ 22,327,176 $ 21,717,997 $ 609,179

The largest portion of the Authority’s net position of $22,327,176 is invested in capital assets

(e.g., land, buildings, equipment, infrastructure and improvements). The Authority uses its

capital assets to provide office rental space and includes the Paramount Theatre and equipment to

maintain these facilities.

The remaining unrestricted net position of $1,811,014 represents resources available to meet

both the Authority’s current and capital obligations.

MD&A 3

Changes in Net Position June 30,

2015 June 30,

2014 Increase/

(Decrease) Operating revenues Paramount Arts Centre $ 11,135,815 $ 6,995,311 $ 4,140,504 North Island Center 1,240,138 888,011 352,127 Total operating revenues 12,375,953 7,883,322 4,492,631

Operating expenses Paramount Arts Centre 12,876,786 10,594,525 2,282,261 North Island Center 1,283,520 851,248 432,272 Aurora Civic Center Authority 650,606 599,655 50,951 Total operating expenses 14,810,912 12,045,428 2,765,484

Operating loss (2,434,959) (4,162,106) 1,727,147 Nonoperating revenues 2,503,501 1,941,934 561,567

Nonoperating expenses - - - Contributions (Capital Grants) 540,637 1,132,673 (592,036)

Net income (loss) $ 609,179 $ (1,087,499) $ 1,696,678

The financial statement is divided into three parts: The Paramount Theatre, North Island Center and Aurora Civic Center Authority. Revenue: The Paramount Theatre’s largest sources of operating revenue are ticket sales from the Broadway Series of $5,822,002 which is generated from 4 shows and 178 performances, and ticket sales from our presented shows of $1,794,836 which is generated from 20 shows and 30 performances. The Broadway Series was very successful in Fiscal Year 2015. All four shows reached the $1 Million mark and Mary Poppins alone sold $2.1 Million in Tickets Sales. The Broadway Series ticket sales increased by $2.8 Million from Fiscal Year 2014 to Fiscal Year 2015. This is followed by combined services charges (Broadway and presented shows) of $717,893 and rental sales of $365,733. The Paramount Theatre has non-operating revenue generated by subsidies of $1,444,050. Aurora Civic Center Authority was awarded a capital improvement grant of $2.1 million and $540,637 was used during fiscal year 2015. The City of Aurora and the Aurora Civic Center Authority also formed an intergovernmental agreement to manage RiverEdge Park in downtown Aurora, $500,000 in supplementary support was generated from this agreement. Total revenues including Tickets Sales, Rental Income, and Maintenance Reimbursement totaled $1,738,161. North Island Center’s largest sources of revenue are office rental of $485,767, Copley Ticket Sales of $414,343, and parking garage revenue of $166,256. The Aurora Civic Center Authority has only non-operating revenue from the State of Illinois gaming tax of $510,000, investment income of $4,674 and miscellaneous income of $4,887.

MD&A 4

Expenses: The total operating expenses for the Aurora Civic Center Authority before depreciation, including all profit centers was $13,774,782. The most significant expenses for the Paramount Theatre were direct expenses for Broadway of $5,244,221, Festivals/RiverEdge Park of $2,768,738, contract labor of $1,055,549, and general and administrative salaries of $863,368. A large portion of the RiverEdge expenses are offset by the supplemental revenue and maintenance fee which are outlined in the combined revenues schedule. The Operating Expenses before depreciation increased by $2,700,000. Capital Assets. During FY 2015, the large additions were a remodel on the bars in the Grand Gallery and Original Lobby in the Paramount Theatre, the remodel of the Ballrooms in the North Island Center, and a new roof on the Paramount Theatre Tower. A summary of changes in capital assets is found in Note 2 to the financial statements. Other pertinent accounting policies related to capital assets can be found in Note 1.c. to the financial statements.

Long-Term Debt. There were no new long term debt obligations entered into during FY2015.

During FY 2012 the Authority entered into a loan agreement with the Dunham Fund to improve

sound and lighting equipment. The first principal payment was made in October 2014. Payments

are due through December 2016 with no interest. See Note 7 to the financial statements for more

information regarding long-term debt.

Requests for Information. The financial report is intended to provide an overview of the

finances of Aurora Civic Center Authority for those with an interest in this organization.

Questions concerning any information contained in this report may be directed to the Vice

President of Finance, 8 E. Galena, Suite 230, Aurora, Illinois 60506.



STATEMENT OF NET POSITION

June 30, 2015

Enterprise Component

Fund Unit Total

CURRENT ASSETS

Cash and cash equivalents 4,814,801$ 34,511$ 4,849,312$

Investments 1,257,316 - 1,257,316

Trade accounts receivable 525,875 - 525,875

Due from/to component unit/primary government 14,420 (14,420) -

Inventory 74,994 - 74,994

Deposits 66,463 - 66,463

Prepaid expenses

General 403,456 - 403,456

Broadway 258,579 - 258,579

Copley Productions 16,500 - 16,500

RiverEdge Park 69,164 - 69,164

Festivals 106,678 - 106,678

Total current assets 7,608,246 20,091 7,628,337

CAPITAL ASSETS

Land 775,972 - 775,972

Buildings and improvements 33,461,031 - 33,461,031

Furniture and fixtures 869,253 - 869,253

Leasehold improvements 358,600 - 358,600

Equipment 2,520,582 - 2,520,582

Vehicles 21,003 - 21,003

Construction in progress 125,163 - 125,163

Subtotal 38,131,604 - 38,131,604

Less accumulated depreciation (17,365,442) - (17,365,442)

Net capital assets 20,766,162 - 20,766,162

Total assets 28,374,408 20,091 28,394,499


AURORA, ILLINOIS

(This statement is continued on the following page.)- 3 -


Fund Unit Total

CURRENT LIABILITIES

Accounts payable 166,636$ -$ 166,636$

Accrued payroll and payroll taxes 8,273 - 8,273

Accrued compensated absences 99,532 - 99,532

Other accrued expenses 431,959 - 431,959

Unearned revenues

Single ticket sales 1,225,557 - 1,225,557

Gift certificate 113,478 - 113,478

Broadway shows 2,856,720 - 2,856,720

RiverEdge Park shows and support 781,477 - 781,477

Loan payable 100,000 - 100,000

Total current liabilities 5,783,632 - 5,783,632

LONG-TERM LIABILITIES

Security deposits 113,600 - 113,600

Loan payable 150,000 - 150,000

Total long-term liabilities 263,600 - 263,600

Total liabilities 6,047,232 - 6,047,232

NET POSITION

Net investment in capital assets 20,516,162 - 20,516,162

Restricted for culture and recreation - 20,091 20,091

Unrestricted 1,811,014 - 1,811,014

TOTAL NET POSITION 22,327,176$ 20,091$ 22,347,267$

STATEMENT OF NET POSITION (Continued)

June 30, 2015




AURORA, ILLINOIS

See accompanying notes to financial statements.- 4 -


Fund Unit Total

OPERATING REVENUES

Paramount Arts Centre 11,135,815$ -$ 11,135,815$

North Island Center 1,240,138 - 1,240,138

Donations - 124,939 124,939

State and regional grants - 11,350 11,350

Corporate sponsorships - 1,032,525 1,032,525

Gala ticket sales - 225,520 225,520

Total operating revenues 12,375,953 1,394,334 13,770,287

OPERATING EXPENSES

Paramount Arts Centre 12,876,786 - 12,876,786

North Island Center 1,283,520 - 1,283,520

Aurora Civic Center Authority 650,606 - 650,606

Subsidies to Aurora Civic Center Authority - 1,444,050 1,444,050

Total operating expenses 14,810,912 1,444,050 16,254,962

OPERATING INCOME (LOSS) (2,434,959) (49,716) (2,484,675)

NON-OPERATING REVENUES (EXPENSES)

State of Illinois gaming tax 510,000 - 510,000

Paramount Arts Centre, Inc. subsidies 1,444,050 - 1,444,050

RiverEdge Park supplementary fee 500,000 - 500,000

RiverEdge Park capital improvement fee 39,407 - 39,407

Investment income 4,677 25 4,702

Miscellaneous income 5,367 - 5,367

Total non-operating revenues (expenses) 2,503,501 25 2,503,526

INCOME (LOSS) BEFORE CONTRIBUTIONS 68,542 (49,691) 18,851

CONTRIBUTIONS

Capital grants 540,637 52,262 592,899

CHANGE IN NET POSITION 609,179 2,571 611,750

NET POSITION, JULY 1 21,717,997 17,520 21,735,517

NET POSITION, JUNE 30 22,327,176$ 20,091$ 22,347,267$

For the Year Ended June 30, 2015




STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION

AURORA, ILLINOIS



Fund Unit Total

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from customers and users 13,579,519$ -$ 13,579,519$

Receipts from miscellaneous revenues 5,367 - 5,367

Receipts from sponsors - 1,168,814 1,168,814

Receipts from events - 225,520 225,520

Payments to suppliers (11,597,855) - (11,597,855)

Payments to employees (1,923,344) - (1,923,344)

Payments through subsidies - (1,446,575) (1,446,575)

Net cash from operating activities 63,687 (52,241) 11,446

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES

State of Illinois gaming tax 510,000 - 510,000

RiverEdge Park supplementary fee 500,000 - 500,000

Paramount Arts Centre, Inc. subsidies 1,444,050 - 1,444,050

Net cash from noncapital financing activities 2,454,050 - 2,454,050

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES

Receipt of capital grants 157,661 52,262 209,923

Purchase of capital assets (1,069,996) - (1,069,996)

Principal paid on long-term debt (100,000) - (100,000)

Net cash from capital and related

financing activities (1,012,335) 52,262 (960,073)

CASH FLOWS FROM INVESTING ACTIVITIES

Interest income received 3,989 25 4,014

Net cash from investing activities 3,989 25 4,014

NET INCREASE IN CASH AND

CASH EQUIVALENTS 1,509,391 46 1,509,437

CASH AND CASH EQUIVALENTS, JULY 1 3,305,410 34,465 3,339,875

CASH AND CASH EQUIVALENTS, JUNE 30 4,814,801$ 34,511$ 4,849,312$

AURORA, ILLINOIS




STATEMENT OF CASH FLOWS


(This statement is continued on the following page.)- 6 -


Fund Unit Total

RECONCILIATION OF OPERATING INCOME

(LOSS) TO NET CASH FLOWS FROM

OPERATING ACTIVITIES

Operating income (loss) (2,434,959)$ (49,716)$ (2,484,675)$

Adjustments to reconcile operating (loss)

to net cash from operating activities

Depreciation 1,036,130 - 1,036,130

Miscellaneous income 5,367 - 5,367

(Increase) decrease in

Receivables 107,340 - 107,340

Inventory (30,933) - (30,933)

Prepaid expenses 238,528 - 238,528

Increase (decrease) in

Accounts payable (156,442) - (156,442)

Accrued payroll and payroll related liabilities (7,044) - (7,044)

Deposits 71,132 - 71,132

Unearned revenue 1,025,094 (2,525) 1,022,569

Other accrued expenses 209,474 - 209,474

NET CASH FROM OPERATING ACTIVITIES 63,687$ (52,241)$ 11,446$

AURORA, ILLINOIS


STATEMENT OF CASH FLOWS (Continued)





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AURORA, ILLINOIS

NOTES TO FINANCIAL STATEMENTS

June 30, 2015

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Aurora Metropolitan Exposition, Auditorium and Office Building Authority, Aurora,

Illinois (Aurora Civic Center Authority) (the Authority) was incorporated under the provisions of Public Act 78-927, Art. I (Aurora Civic Center Act), effective July 1, 1974. The duties of the Authority are to promote, operate and maintain expositions, conventions, theatrical, sports and cultural activities from time-to-time in the metropolitan area and in connection therewith to arrange, finance and maintain industrial, cultural, educational, theatrical, sports, trade and scientific exhibits and to construct, equip and maintain auditorium, exposition and office buildings for such purposes.

The basic financial statements of the Authority have been prepared in conformity with

accounting principles generally accepted in the United States of America as applied to government units (herein referred to as generally accepted accounting principles (GAAP)). The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the Authority’s accounting policies are described below.

a. Reporting Entity

The Authority is a municipal corporation established by Illinois Compiled Statutes. As required by accounting principles generally accepted in the United States of America, these financial statements present the Authority (the primary government) and its component units. In evaluating how to define the reporting entity, management has considered all potential component units. The decision to include a potential component unit in the reporting entity was based upon the significance of its operational or financial relationship with the primary government and that this entity has the same governing board.

Component Unit - The component unit column in the basic financial statements

includes the financial data of the Authority’s only component unit. It is reported in a separate column to emphasize that it is legally separate from the Authority. The Board of the component unit is the same as the Authority and the component unit provides services entirely to the Authority. Paramount Arts Centre, Inc. is a nonprofit fundraising foundation that accepts contributions and, from time-to-time, provides financial support to the Authority for subsidizing certain events at the Paramount Arts Centre, Inc. Separate audited financial statements as of June 30, 2015 are available from the Paramount Arts Centre, Inc.’s administrative office at 8 East Galena Boulevard, Suite 230, Aurora, IL 60506.

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AURORA, ILLINOIS

NOTES TO FINANCIAL STATEMENTS (Continued)

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1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

b. Fund Accounting

The accounts of the Authority are accounted for in an Enterprise Fund. The

accounting and financial reporting treatment applied to a fund is determined by its

measurement focus. The enterprise fund is accounted for on a flow of economic

resources measurement focus. With this measurement focus, all assets and all

liabilities associated with the operation of these funds are included on the statement

of net position. The accrual basis of accounting is utilized. Under this method,

revenues are recorded when earned and expenses are recorded at the time liabilities

are incurred. The Enterprise Fund, a major fund, referred to as the Operating Fund by

the Authority, is used to account for operations (a) that are financed and operated in a

manner similar to private business enterprises where the intent of the governing body

is that the costs (expenses, including depreciation) of providing goods or services to

the general public on a continuing basis be financed or recovered primarily through

user charges; or (b) where the governing body has decided that periodic

determination of revenues earned, expenses incurred and/or net income is appropriate

for capital maintenance, public policy, management control, accountability or other

purposes. Operating revenues/expenses include all revenues/expenses directly related

to providing enterprise fund services. Incidental revenues/expenses are reported as

non-operating revenues and expenses.

c. Capital Assets

All purchased capital assets are valued at cost. Donated capital assets are valued at

their estimated fair value on the date donated. The cost of normal maintenance and

repairs that do not add to the value of the asset or materially extend asset lives are

expensed. Improvements are capitalized and depreciated over the remaining useful

lives of the related capital assets, as applicable.

Depreciation on all exhaustible capital assets used by the Enterprise Fund is charged

as an expense against its operations. Depreciation has been provided over the

estimated useful lives of the related assets using the straight-line method. The

estimated useful lives are as follows:

Years

Leasehold improvements 10-50

Buildings 5-50

Equipment 5-33

Vehicles, furniture and fixtures 5-30

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AURORA, ILLINOIS


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1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

d. Accrued Compensated Absences

Employees of the Authority are granted various lengths of vacation based on

seniority. Accumulated unpaid vacation is accrued by the Authority in the Enterprise

Fund. The liability for accumulated unpaid vacation pay is based upon accumulated

days at June 30, 2015 multiplied by the current salary and related benefits for each

employee. Sick leave is not paid at termination or retirement and, therefore, any

earned sick leave has not been recorded as a liability.

e. Cash and Investments

Investments are stated at fair value. For the statement of cash flows, cash and cash

equivalents includes demand deposits and investments with a maturity at time of

purchase of three months or less. All investments not reserved under other

ordinances have been designated by the Board of Directors for future building

improvements, show subsidies and other operating expenses.

f. Prepaid Expenses

Artists’ fees and promotional expenses paid during the current year that relate to the

theater season commencing after June 30, 2015 are charged to operations at such

time as the related events are held.

g. Unearned Revenues

Advance ticket sales and season subscription sales are unearned and recorded as

income at such time as the related events are held.

h. Allowance for Doubtful Accounts

The Authority follows the practice of charging uncollectible accounts to operations in

the period in which they are determined to be uncollectible. No allowance for

doubtful accounts has been provided as of June 30, 2015 since substantially all

receivables are believed to be fully collectible.

i. Net Position

In the basic financial statements, restricted net position is legally restricted by outside

parties for a specific purpose. Net investment in capital assets is the book value of

capital assets less any long-term debt outstanding that was issued to construct or

acquire the capital assets.

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AURORA, ILLINOIS


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1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) i. Net Position (Continued)

When both restricted and unrestricted resources are available for use, it is the Authority’s policy to use restricted resources first, then unrestricted resources when they are needed. No net position is restricted as a result of the Authority’s own enabling legislation.

j. Accounting Estimates The preparation of financial statements in conformity with GAAP requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates.

2. CAPITAL ASSETS Capital asset activity for the year ended June 30, 2015 was as follows:

Beginning

Balances

Increases

Decreases Ending

Balances

Capital assets not being depreciated Land $ 775,972 $ - $ - $ 775,972 Construction in progress 39,583 125,163 39,583 125,163

Total capital assets not being depreciated 815,555 125,163 39,583 901,135

Capital assets being depreciated Leasehold improvements 327,132 31,469 - 358,601 Building 33,040,013 421,018 - 33,461,031 Equipment 2,520,089 492 - 2,520,581 Vehicles 21,003 - - 21,003 Furniture and fixtures 337,817 531,436 - 869,253

Total capital assets being depreciated 36,246,054 984,415 - 37,230,469

Less accumulated depreciation for Leasehold improvements 242,145 20,656 - 262,801 Building 14,734,615 745,363 - 15,479,978 Equipment 1,126,363 221,803 - 1,348,166 Furniture and fixtures 226,189 48,308 - 274,497

Total accumulated depreciation 16,329,312 1,036,130 - 17,365,442

Total capital assets being depreciated, net 19,916,742 (51,715) - 19,865,027

CAPITAL ASSETS, NET $ 20,732,297 $ 73,448 $ 39,583 $ 20,766,162

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AURORA, ILLINOIS


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3. DEPOSITS AND INVESTMENTS The Authority’s investment policy authorizes the Authority to make deposits/invest in

commercial banks, savings and loan institutions, interest-bearing general obligations of the U.S. Treasury and U.S. agencies and other non-interest-bearing general obligations of the United States Government when offered for sale in the open market at a price below the face value, money market mutual funds, taxable municipal bonds with at least a AA underlying or AAA insured bonds, fixed annuity products and variable annuity products (with a guaranteed minimum return).

It is the policy of the Authority to invest its funds in a manner which will provide the

highest investment return with the maximum security while meeting the daily cash flow demands of the Authority and conforming to all state and local statutes governing the investment of public funds, using the “prudent person” standard for managing the overall portfolio. The primary objective of the policy is safety of principal, liquidity, yield and maintaining the public trust.

a. Deposits with Financial Institutions

Custodial credit risk for deposits with financial institutions is the risk that in the

event of bank failure, the Authority’s deposits may not be returned to it. The Authority’s investment policy requires pledging of collateral for all bank balances in excess of federal depository insurance with collateral held by an agent of the Authority in the Authority’s name.

b. Investments The following table presents the investments and maturities of the Authority’s debt

securities as of April 30, 2015:

Investment Maturities (in Years)

Investment Type Fair Value Less than 1 1-5 6-10 Greater than 10

Negotiable CD’s $ 506,975 $ 506,975 $ - $ - $ -

TOTAL $ 506,975 $ 506,975 $ - $ - $ -

Interest rate risk is the risk that changes in interest rates will adversely affect the fair

value of an investment. In accordance with its investment policy, the Authority limits its exposure to interest rate risk by diversifying its investment portfolio. A variety of financial instruments and maturities, properly balanced, will help to ensure liquidity and reduce risk or interest rate volatility and loss of principal. Diversifying investments and maturities will avoid incurring unreasonable risks in the investment portfolio regarding specific security types, issuers or individual financial institutions. The Authority’s investment policy does not specifically limit the maximum maturity length of investments.

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AURORA, ILLINOIS


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3. DEPOSITS AND INVESTMENTS (Continued)

b. Investments (Continued)

The Authority limits its exposure to credit risk, the risk that the issuer of a debt

security will not pay its par value upon maturity, by primarily investing in obligations guaranteed by the United States Government or securities issued by agencies of the United States Government that are explicitly guaranteed by the United States Government and money market mutual funds. However, the Authority’s investment policy does not specifically limit the Authority to these types of investments.

Custodial credit risk for investments is the risk that, in the event of the failure of the

counterparty to the investment, the Authority will not be able to recover the value of

its investments that are in possession of an outside party. To limit its exposure, the

Authority’s investment policy requires all security transactions that are exposed to

custodial credit risk to be processed on a delivery versus payment (DVP) basis with

the underlying investments held by a third party acting as the Authority’s agent

separate from where the investment was purchased.

4. EMPLOYEE BENEFIT PLANS

The Authority provides a 401(k) defined contribution plan to all full-time salaried

employees. The employee is eligible to contribute upon employment and the Authority will

match dollar for dollar up to 5% after one year of employment. The funds contributed by

the Authority are fully vested after five years. The contribution made by the Authority for

the year ended June 30, 2015 was $57,525. The plan can be revised by the Authority Board

of Directors. The number of employees participating in the plan at June 30, 2015 was 21.

5. INTERGOVERNMENTAL AGREEMENTS

During fiscal year 1995, the Authority entered into an agreement (redevelopment

agreement) with Hollywood Casino-Aurora, Inc. and the City of Aurora (the City) to

provide for the expansion and redevelopment of the North Island Center (the Center). The

agreement involved demolition of the existing parking structure, construction of a new

parking deck, reconfiguration of the basement level of the parking lot and renovation of

certain points of the Center. Under the terms of the agreement, during fiscal year 1996, the

Authority issued $11,500,000 of taxable revenue bonds to be used in the completion of the

above items, which were from the proceeds of a lease agreement (the Lease) with

Hollywood Casino-Aurora, Inc. entered into in conjunction with the redevelopment

agreement. The City is a contingent lessee under this lease agreement if the Hollywood

Casino-Aurora, Inc. should fail to fulfill its obligation under the agreements.

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AURORA, ILLINOIS


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5. INTERGOVERNMENTAL AGREEMENTS (Continued)

Prior to the redevelopment agreement, the Authority entered into an agreement with the

City whereby the City remitted to the Authority 30% of distributions received by the City

from the State of Illinois for admissions tax under the Illinois Riverboat Gambling Act.

This agreement was amended on March 22, 1994 to reflect the 30% share being limited to

$127,500 per calendar year quarter. The agreement involving the City and the Authority

and the gambling tax proceeds to be remitted to the Authority were incorporated into the

redevelopment agreement. It was further noted in this agreement that if the admissions tax

was eliminated and replaced by an increased Adjusted Gross Receipts or other gaming tax,

the City would provide the Authority with a proportionate share of such replacement taxes

in order to maintain the current level of support. During the years ended June 30, 1998,

1999 and 2000, the City reduced this amount by 50% for the City’s fiscal years ended

December 31, 1997, 1998 and 1999. The City is responsible, under the agreement, as

revised in 1995; to fund operating support of the Authority up to an amount of $250,000

should the City eliminate or reduce funding to the Authority provided by admissions tax on

Hollywood Casino-Aurora, Inc. under the Illinois Riverboat Gambling Act.

The lease is for a period of 30 years with extensions of up to 20 years and requires the

Hollywood Casino-Aurora, Inc. to pay a monthly rent of $16,876, less certain credits. The

lease is a triple net lease, with the Hollywood Casino-Aurora, Inc. responsible for utilities,

maintenance, repairs, insurance, taxes and related costs. Total rental income recognized

under this lease during the year ended June 30, 2015 was $180,412.

6. NORTH ISLAND CENTER LEASES

The Authority leases office space to various businesses at the Center. The leases are

operating leases with fixed monthly rental payments. Certain leases are subject to cost of

living adjustments. The following is a schedule of approximate future minimum rentals

under enforceable leases at June 30, 2015, not including cost of living adjustments.

Year Ending

June 30,

2016 $ 456,168

2017 395,707

2018 377,484

2019 281,220

2020 39,069

AGGREGATE FUTURE MINIMUM RENTALS $ 1,549,648

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AURORA, ILLINOIS


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7. LONG-TERM LIABILITIES a. Loan Payable - Dunham Fund In December 2011, the Authority entered into a loan agreement with the Dunham

Fund for various enhancements to the Paramount Arts Centre. These enhancements include certain improvements to improve the lighting and sound equipment at the Paramount Arts Centre. The Authority is responsible for the repayment of $350,000. Principal amounts are due through December 1, 2016 with no interest.

The following is a summary of changes in long-term financing from the Dunham

Fund:

July 1 Additions Reductions June 30 Current

Loan payable $ 350,000 $ - $ 100,000 $ 250,000 $ 100,000

Approximate annual debt service requirements to maturity are as follows:

Fiscal Year

Principal

Total

2016 $ 100,000 $ 100,000 2017 150,000 150,000

TOTAL $ 250,000 $ 250,000

8. RISK MANAGEMENT The Authority is exposed to various risks of loss including, but not limited to employee

health, general liability, property casualty, workers’ compensation and public official liability. To limit exposure to these risks, the Authority has purchased third party indemnity insurance. There have been no significant reductions in insurance coverage and settlement amounts have not exceeded insurance coverage in each of the past three years.

9. OTHER POSTEMPLOYMENT BENEFITS The Authority is subject to no statutory requirements to provide health insurance to its

retirees as the Authority does not participate in the Illinois Municipal Retirement Fund. Therefore, there is no implicit subsidy to calculate in accordance with GASB Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions. Additionally, the Authority has no former employees or agreements with current employees for which the Authority was providing an explicit subsidy as of June 30, 2015. For the year ended June 30, 2015, the Authority had no retirees purchasing health insurance through the Authority.

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SUPPLEMENTARY INFORMATION

Aurora Civic

Paramount Arts North Island Center

Centre Center Authority Total

OPERATING REVENUES

Subscription ticket sales 174,894$ 52,499$ -$ 227,393$

Single ticket sales 1,331,844 296,158 - 1,628,002

Group ticket sales 288,098 65,686 - 353,784

Service charges 179,491 105,290 - 284,781

Concession sales 149,145 32,835 - 181,980

Broadway - subscription ticket sales 2,724,482 - - 2,724,482

Broadway - single ticket sales 2,743,420 - - 2,743,420

Broadway - group ticket sales 354,100 - - 354,100

Broadway - service charges 538,402 - - 538,402

Broadway - merchandise income 124,407 - - 124,407

Broadway - concession sales 314,019 - - 314,019

Scenic shop 149,026 - - 149,026

Theatre rental 365,733 16,073 - 381,806

Office rental - 485,767 - 485,767

Parking deck rental - (113) - (113)

Ballroom rental - 19,687 - 19,687

Parking garage rental - 166,256 - 166,256

RiverEdge Park maintenance fee 434,152 - - 434,152

Festivals 1,264,602 - - 1,264,602

TOTAL OPERATING REVENUES 11,135,815$ 1,240,138$ -$ 12,375,953$

NON-OPERATING REVENUES

AND CONTRIBTUIONS

State of Illinois gaming tax -$ -$ 510,000$ 510,000$

Subsidy 1,444,050 - - 1,444,050

RiverEdge Park supplementary fee 500,000 - - 500,000

RiverEdge Park capital improvement fee 39,407 - - 39,407

Investment income - - 4,677 4,677

Miscellaneous 480 - 4,887 5,367

Capital grants 540,637 - - 540,637

TOTAL NON-OPERATING REVENUES

AND CONTRIBTUIONS 1,983,937$ -$ 519,564$ 2,503,501$


COMBINING SCHEDULE OF REVENUES - ENTERPRISE FUND




AURORA, ILLINOIS

(See independent auditor's report.)- 16 -

Aurora Civic

Paramount Arts North Island Center

Centre Center Authority Total

OPERATING EXPENSES

Artist care 40,802$ 20,153$ -$ 60,955$

Broadway - direct expenses 5,244,221 - - 5,244,221

Broadway - overhead 96,299 - - 96,299

Broadway - salaries and benefits 463,456 - - 463,456

Computer 51,634 10,930 26,055 88,619

Contract labor 1,055,549 248,577 - 1,304,126

Dues and subscriptions 5,160 - 4,283 9,443

Employee benefits 29,661 1,997 41,451 73,109

Festivals 2,768,738 - - 2,768,738

Hospitality 1,280 589 793 2,662

Insurance 225,311 41,813 47,643 314,767

Janitorial service and supplies 52,940 41,442 - 94,382

License fees 4,270 - 221 4,491

Meals and entertainment 2,727 27 1,206 3,960

Travel 4,445 - 308 4,753

Miscellaneous 10,686 5,163 16,546 32,395

Payroll taxes and processing 106,903 9,633 47,492 164,028

Shipping and handling 57,758 13,078 2,709 73,545

Printing - 1,158 - 1,158

Professional fees - - 51,859 51,859

Promotion 262,637 34,552 - 297,189

Rental equipment 1,036 1,612 - 2,648

Repairs and maintenance 131,455 84,480 967 216,902

Retirement - 2,452 12,128 14,580

Salaries - concession 12,889 5,235 - 18,124

Salaries - general and administrative 863,368 65,369 341,278 1,270,015

Salaries - house manager 11,417 - - 11,417

Salaries - production 146 - - 146

Salaries - stagehands 124,608 28,534 - 153,142

Scenic shop 110,545 - - 110,545

Security 37,500 7,261 - 44,761

Show 309,261 16,617 - 325,878

Supplies - concession 47,782 10,684 - 58,466

Supplies - other 79,751 3,730 8,324 91,805

Telephone 14,493 899 26,687 42,079

Training and education 2,955 - 2,946 5,901

Utilities 149,085 105,133 - 254,218

Total operating expenses before

depreciation 12,380,768 761,118 632,896 13,774,782

Depreciation 496,018 522,402 17,710 1,036,130

TOTAL OPERATING EXPENSES 12,876,786$ 1,283,520$ 650,606$ 14,810,912$





COMBINING SCHEDULE OF EXPENSES - ENTERPRISE FUND

AURORA, ILLINOIS

(See independent auditor's report.)- 17 -

AURORA METROPOLITAN EXPOSITION, AUDITORIUM AND OFFICE ... District/IL Aurora... · aurora...

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