SOLUTION: NJCU The State of New Jersey Sources of Funds and Capital Projects Discussion

State of New Jersey
Comprehensive Annual
Financial Report
Fiscal Year Ended June 30, 2019
Philip D. Murphy
Governor
Sheila Y. Oliver
Lieutenant Governor
Elizabeth Maher Muoio
State Treasurer
David Ridolfino
Acting Director
Office of Management and Budget
Michael A. Griffin
Associate Director
Financial Management
Lynn Azarchi
Deputy Director
Office of Management and
Budget
Jeffrey C. DeCicco
Assistant Director
Financial Reporting
This document is available via the internet nj.gov/treasury/omb/cafr.shtml.
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This document is available via the internet nj.gov/treasury/omb/cafr.shtml.
STATE OF NEW JERSEY
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2019
TABLE OF CONTENTS
INTRODUCTION
Page
Letter of Transmittal …………………………………………………………………………………………………………………………………
1
Certificate of Achievement ……………………………………………………………………………………………………………………….
9
FINANCIAL SECTION
Independent Auditor’s Report ……………………………………………………………………………………………………………………
13
Management’s Discussion and Analysis ……………………………………………………………………………………………………..
19
Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position …………………….…………………………………………………………..……
32
Statement of Activities ……………………………………………………………………………………………………………………..
34
Governmental Funds Financial Statements
Balance Sheet …………………………………………………………………………………………………………………………………..
36
Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position …………………….
37
Statement of Revenues, Expenditures, and Changes in Fund Balances…………………………………………………….
38
Reconciliation of the Changes in Fund Balances of Governmental Funds to the Statement of Activities……
39
Proprietary Funds Financial Statements
Statement of Net Position ………………………………………………………………………………………………………………….
40
Statement of Revenues, Expenses, and Changes in Net Position …………………………………………………………..
Statement of Cash Flows …………………………………………………………………………………………………………………..
Fiduciary Funds Financial Statements
41
42
Statement of Fiduciary Net Position ……………………………………………………………………………………………………
44
Statement of Changes in Fiduciary Net Position …………………………………………………………………………………..
46
Component Units Financial Statements
Statement of Net Position…………………………………………………………………………………………………………………..
Statement of Activities ……………………………………………………………………………………………………………………..
48
50
Notes to the Financial Statements Index ……………………………………………………………………………………………………..
54
Notes to the Financial Statements ………………………………………………………………………………………………………………
55
Required Supplementary Information
Required Supplementary Information Index………………………………………………………………………………………………..
127
Required Supplementary Information Schedules………………………………………………………………………………………….
128
Combining Financial Statements and Schedules
Governmental Funds – Major Fund – General Fund
Balance Sheet…………………………………………………………………………………………………………………………………..
158
Schedule of Revenues, Expenditures, and Changes in Fund Balances……………………………………………………..
174
Governmental Funds – Non-Major Funds
Balance Sheet – By Fund Type …………………………………………………………………………………………………………
191
Statement of Revenues, Expenditures, and Changes in Fund Balances – By Fund Type…………………………….
Special Revenue Funds – Non-Major Funds
192
Balance Sheet…………………………………………………………………………………………………………………………………..
194
Schedule of Revenues, Expenditures, and Changes in Fund Balances……………………………………………………..
212
Combining Financial Statements and Schedules (Continued)
Capital Projects Funds
Balance Sheet …………………………………………………………………………………………………………………………………..
Statement of Revenues, Expenditures, and Changes in Fund Balances…………………………………………………….
Fiduciary Funds
Agency Funds
Statement of Fiduciary Net Position ……………………………………………………………………………………………………
Page
232
236
240
Statement of Changes in Assets and Liabilities …………………………………………………………………………………….
Pension and Other Employee Benefits Trust Funds
246
Statement of Fiduciary Net Position ……………………………………………………………………………………………………
Statement of Changes in Fiduciary Net Position …………………………………………………………………………………..
254
258
Private Purpose Trust Funds
Statement of Fiduciary Net Position ……………………………………………………………………………………………………
262
Statement of Changes in Fiduciary Net Position …………………………………………………………………………………..
Component Units
Statement of Net Position – Non-Major Component Units …………………………………………………………………….
264
Statement of Activities – Non-Major Component Units ………………………………………………………………………..
Authorities
267
Statement of Net Position ……………………………………………………………………………………………………………
Statement of Activities ………………………………………………………………………………………………………………..
268
272
Colleges and Universities
Statement of Net Position …………………………………………………………………………………………………………….
276
Statement of Activities ………………………………………………………………………………………………………………..
Description of Funds ………………………………………………………………………………………………………………………………..
280
283
266
Other Information
Capital Assets
Schedule of Changes in Gross Capital Assets by Function …………………………………………………………………….
Schedule of Gross Capital Assets by Function ……………………………………………………………………………………..
307
308
Schedule of Changes in Accumulated Depreciation by Function ……………………………………………………………
Schedule of Accumulated Depreciation by Function …………………………………………………………………………….
311
312
Accumulated Depreciation as a Percentage of Capital Assets by Category ……………………………………………..
Accumulated Depreciation as a Percentage of Capital Assets by Function ………………………………………………
314
314
Long-Term Obligations
Schedule of Long-Term Obligations …………………………………………………………………………………………………..
Budgetary Schedules
316
Budgetary Comparison Schedule – Non-Major Governmental Funds………………………………………………………
Budgetary Comparison Schedule – Budget-to-GAAP Reconciliation-Non-Major Funds……………………………
Schedule of Anticipated Revenue ……………………………………………………………………………………………………….
Schedule of Appropriated Revenue …………………………………………………………………………………………………….
318
322
324
333
Schedule of Appropriations and Expenditures ……………………………………………………………………………………..
334
STATISTICAL SECTION
Statistical Section Index ……………………………………………………………………………………………………………………………
355
Statistical Section Schedules………………………………………………………………………………………………………………………
356
PHILIP D. MURPHY
Governor
SHEILA Y. OLIVER
Lt. Governor
DEPARTMENT OF THE TREASURY
OFFICE OF MANAGEMENT AND BUDGET
P.O. BOX 221
TRENTON, NJ 08625-0221
ELIZABETH MAHER MUOIO
State Treasurer
DAVID RIDOLFINO
Acting Director
Telephone (609) 292-6746 / Facsimile (609) 633-8179
March 30, 2020
Governor Philip D. Murphy
Members of the State Legislature
New Jersey Citizens
In accordance with the provisions of N.J.S.A.52:27B-46, it is our pleasure to transmit to you the State of New Jersey’s
Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2019. The Department of the Treasury’s
Office of Management and Budget prepared this report. The Department of the Treasury and the Office of Management and
Budget are responsible for the accuracy, completeness, and fairness of all data presented, including all disclosures.
This CAFR presents the financial position and operating results of the State under generally accepted accounting principles
(GAAP) applicable to state and local governments, as established by the Governmental Accounting Standards Board (GASB).
The State also participates in the Government Finance Officers Association (GFOA) of the United States and Canada’s
Certificate of Achievement for Excellence in Financial Reporting review program.
The State operates in accordance with the standards provided in GASB Statements No. 34, Basic Financial Statements and
Management’s Discussion and Analysis for State and Local Governments, and No. 35, Basic Financial Statements and
Management’s Discussion and Analysis for Public Colleges and Universities. In addition to providing traditional fund financial
statements, the objective of this reporting model is to provide a single, unified, transparent picture of the State’s fiscal health;
thus, this CAFR clearly displays all of the State’s revenues, costs, assets, and liabilities. This report also includes a
Management’s Discussion and Analysis section, which provides users with an objective and easy-to-read analysis of New
Jersey’s financial performance for the fiscal year ended June 30, 2019. We are confident that the data is accurate in all material
respects and presented in a manner designed to set forth fairly the financial position and results of the State’s operations, as
measured by the fiscal activity of its various funds, and includes all disclosures necessary to enable the reader to gain a
reasonable understanding of the State’s financial affairs.
NEW JERSEY GOVERNMENT
The State of New Jersey was one of the original 13 colonies and was the third state to ratify the United States Constitution in
1787. The original State Constitution was adopted on July 2, 1776 and was subsequently superseded by the State Constitution of
1844. A new State Constitution was prepared by a constitutional convention in 1947 and was ratified by voters of the State in the
General Election held November 4, 1947. The State Constitution divides the powers of government between three co-equal
independent branches: Legislative, Executive, and Judicial.
Legislative Branch
Senate
Judicial Branch
Executive Branch
Governor
Assembly
Supreme Court
Superior Court
Tax Court
Lt. Governor
Departments
Agriculture
Banking and
Insurance
Corrections
Human Services
State
Education
Labor and Workforce
Development
Transportation
Treasury
Children and
Families
Environmental
Protection
Law and Public
Safety
Community Affairs
Health
Military and
Veterans’ Affairs
Legislative: The State’s bicameral Legislative Branch, which consists of a total of 120 members from 40 legislative districts with
elections held in odd-numbered years, meets in annual sessions in Trenton, the State’s capital. The 40 members of the State
Senate are elected to terms of four years, except for the election following a decennial census, in which case the term is for two
years. The 80 members of the General Assembly are elected to terms of two years. Neither State Senators nor Assembly
Members are subject to term limits. The Office of Legislative Services (OLS) is a nonpartisan agency that provides legislators
with legal, fiscal, research, information, and administrative services. Key OLS positions include an executive director, a
legislative counsel, the State Auditor, a legislative budget and finance officer, a director of central staff, a director of data
management, and a director of administration.
Executive: The Office of the Chief Executive, which oversees the entire Executive Branch, consists of the Governor, the
Lieutenant Governor, Cabinet-level department heads, and staff who are responsible for carrying out the Governor’s
constitutional powers and duties. Upon direct election by a plurality of the State’s voters, both the Governor and the Lieutenant
Governor may serve two successive terms of four years. With the exception of the Secretary of Agriculture, who is chosen by the
Board of Agriculture with the Governor’s approval, the New Jersey State Constitution grants the Governor the authority to
appoint the entire cabinet as well as all Superior Court Judges and county prosecutors, subject to confirmation by the New Jersey
Senate. Department heads remain in office until their successors are named and confirmed by the Senate; the only exceptions are
the Attorney General and the Secretary of State, who are appointed to serve throughout the Governor’s entire term. Although the
State Constitution permits a maximum of 20 departments, the State’s payroll consisted of approximately 54,809 employees in 15
departments as of January 2019. The Executive Branch also oversees the performance of 565 municipalities and 585 school
districts, and the incarceration and rehabilitation of 16,673 prisoners. In addition to reliable transportation and protection for the
State’s citizenry and environment, the Executive Branch provides social services for one out of every five New Jersey residents
and one out of every three children.
Judicial: New Jersey’s Supreme Court consists of a Chief Justice, who is the administrative head of all courts under the State’s
jurisdiction, as well as six Associate Justices. In addition to Municipal and Tax Courts located throughout the State, there are
Superior Courts, with a minimum of two Judges, in each of New Jersey’s 21 counties. After nomination by the Governor and
subsequent confirmation by the State Senate, all Supreme Court Justices and Superior Court Judges serve initial terms of seven
years. Should they be deemed eligible by both the Governor and the State Senate, Supreme Court Justices and Superior Court
Judges acquire tenure with retirement at age 70 as mandated by the State Constitution. For purposes of judicial administration,
the State is divided into 15 vicinages, each consisting of a single county or a combination of counties. The Administrative Office
of the Courts provides support services. Approximately 7.4 million new cases were filed in New Jersey’s courts during Fiscal
Year 2019, including 6.6 million in Municipal Court and 0.8 million in Superior Court. These cases address matters concerning
civil, criminal, and family law.
2
COLLEGES AND UNIVERSITIES
As of July 1, 2019, the higher education system in New Jersey includes four public research universities, seven State
colleges and universities, 19 community colleges, 15 independent four-year colleges and universities, 12 proprietary institutions
with degree-granting authority, 30 Talmudic institutions and theological seminaries, and one independent two-year religious
college. In November 2012, New Jersey voters approved the $750 million “Building our Future Bond Act” (P.L. 2012, c.141),
and in addition to this Act the State has authorized an additional issuance from four higher education funding programs in the
aggregate amount of $925 million. These four programs are the Higher Education Capital Improvement Fund, the Higher
Education Facilities Trust Fund, the Higher Education Technology Infrastructure Fund, and the Higher Education Equipment
Leasing Fund. Of the $1,675 million authorized, $425.1 million remains unissued as of June 30, 2019.
COMPONENT UNITS
In accordance with the requirements of GASB Statement No. 14, The Financial Reporting Entity, and GASB Statement No.
61, The Financial Reporting Entity: Omnibus, an amendment of GASB Statement No. 14 and No. 34, this CAFR for fiscal year
ended June 30, 2019, includes the accounts of 20 public authorities and 11 State public colleges and universities. Public
authorities are legal, separate entities that are not operating departments of the State. Governing boards are vested with the power
to independently manage and set policies for the organization. Each component unit is established for a specific purpose for the
benefit of the State’s citizenry. GASB Statement No. 14 provides that the State’s financial statements should emphasize the
primary government and permit financial statement users to distinguish between the primary government and its component
units. As a result, the transmittal letter, Management’s Discussion and Analysis, and the financial statements focus on the
primary government of the State and its activities, although information pertaining to the component units is presented. For
additional information, please see Note 18 – Component Units.
Executive Order No. 122, signed on July 23, 2004, was established to direct the Board of Directors for each State authority,
commission, board, and council to create an Audit Committee whose members are to assist in the oversight of the financial
reporting and audit processes of the entities. Each member of the Audit Committee is independent of the entity, with at least one
member having a background in accounting or related financial expertise. The Audit Committee must assist the Board in
retaining an independent auditor to conduct an audit. The auditor selection process must be based on public, competitive bidding
princ …
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