Boca Raton CRA posts unmodified audit opinion; deferred lease inflows reflect Meisner Park ground leases

Carlisha Jenkins, deputy chief financial officer for the City of Boca Raton, presented the Boca Raton Community Redevelopment Agency’s audited financial statements for the fiscal year ended Sept. 30, 2024, at the agency’s April 21 meeting.

Jenkins said the CRA reported more than $143 million in total assets and about $47.3 million in capital assets. The agency ended the year with $575,000 in total liabilities and about $58.5 million in deferred inflows tied to future lease payments under multiple Meisner Park ground leases, she said. The CRA’s net position was $83.9 million, of which $36.7 million was restricted.

The statements show $21.4 million in tax increment revenues and approximately $4.6 million in charges for services. Jenkins said the CRA reported a positive variance of roughly $17.5 million between the final adopted budget and actual results; actual expenditures were lower than budgeted by about $14.9 million, in part due to timing and the elimination of a budgeted refund of tax increment to taxing authorities.

Hermanus Garzone, senior audit manager for CBIS CPAs, told the board the firm issued an unmodified (clean) opinion on the CRA financial statements and found no reportable internal-control deficiencies or compliance issues. Garzone said the firm also issued the required management communications and a compliance letter under state audit rules; nothing in the audit required disclosure beyond the financial statements.

In response to a commissioner’s question, finance staff explained the increase in deferred inflows results from accounting pronouncements that require certain long-term leases to be presented on the statement of net position. Staff said the deferred inflows were calculated on base rents; percentage-rent provisions that entitle the CRA to a share of upside revenue are not recorded as receivable until earned and, therefore, are not included in the deferred inflows calculation.

Finance staff and the board discussed that the recent positive fund-balance change is primarily timing related to capital projects. Staff said the roughly $15.8 million increase in fund balance results in an ending fund balance of about $35.2 million; those funds are intended to be used for upcoming capital infrastructure needs tied to downtown redevelopment and the government campus project, including drainage, water and sewer capacity, and street work.

No formal action was taken at the meeting on the financial statements; the presentation concluded and staff said they will present related budget and planning items in upcoming workshops.