Agenda
Board of Finance - Agenda - Feb 17, 2026
Feb 17, 2026
A public record published by the Town of Simsbury (simsbury-ct.gov). mySimsbury indexes it and makes it readable; it is not the official copy. View the original file.
Page 1 of 2 Board of Finance Regular Meeting February 17, 2026 – 5:45 p.m. Simsbury Town Hall – Main Meeting Room 933 Hopmeadow Street *Meeting May Be Held in a Virtual Only Format if Inclement Weather is Expected on Day of Meeting* AGENDA Call to Order Pledge of Allegiance Public Audience Presentation: CliftonLarsonAllen LLP Presentation: Fiducient Finance Director’s Report Agenda Items a) Supplemental Appropriation – Aquarion Water Paving Funds b) Fiscal Year 2025/2026 Mid-Year Transfers c) Fiscal Year 2024/2025 Annual Report Draft Review of Minutes d) January 20, 2026 Regular Meeting Minutes Communications e) 2025 Grand List Reports a. Projections vs Final Analysis b. Net Assessment Comparison c. Gross Assessment Comparison d. Exemptions & Abatements e. Grand List 15 Year Historical Changes f. Top 10 Taxpayers Board of Finance Regular Meeting Agenda February 17, 2026 Page 2 of 2 f) Simsbury Performing Arts Center Band Shell Expansion Project Update Executive Session g) Pursuant to CGS 1-200(6)(c) and 100-200(6)(e) – Cyber Security Update Adjourn Board of Finance Meeting Schedule: 3/3/26, 3/10/26, 3/19/26, 4/7/26, 4/21/26, 5/19/26, 6/16/26, 7/21/26, 8/18/26, 9/15/26, 10/20/26, 11/17/26, 12/15/26, 1/12/27 CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLAglobal.com/disclaimer. CliftonLarsonAllen LLP CLAconnect.com Board of Finance Town of Simsbury, Connecticut We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Town of Simsbury, Connecticut (the Town), as of and for the year ended June 30, 2025, and have issued our report thereon dated December 16, 2025. We have previously communicated to you information about our responsibilities under auditing standards generally accepted in the United States of America, Government Auditing Standards, and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), and the Connecticut State Single Audit Act (State Single Audit), as well as certain information related to the planned scope and timing of our audit in our engagement agreement dated May 22, 2025. Professional standards also require that we communicate to you the following information related to our audit. Significant audit findings or issues Qualitative aspects of accounting practices Accounting policies Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the Town are described in Note 1 to the financial statements. The Town changed accounting policies related to Compensated Absences by adopting Statement of Governmental Accounting Standards Board (GASB Statement No. 101), Compensated Absences in 2025. The adoption of this standard did not have a material impact on the financial statement presentation or note disclosure. We noted no transactions entered into by the Town during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected.1 Board of Finance Town of Simsbury, Connecticut Page 2 The most sensitive estimates affecting the financial statements were: Management’s estimate of the net pension liability is based on an actuarial valuation utilizing various assumptions and estimates approved by management. Management’s estimate of the other postemployment benefit (OPEB) liability is based on an actuarial valuation utilizing various assumptions and estimates approved by management. Management’s estimate of investments measured at fair value not based on market prices, or with permanent impairments, such as derivative instruments, is based on information provided by the investments’ custodians. Management’s estimate of the incurred but not reported related to medical is processed by third parties and based on actual and historical information. We evaluated the key factors and assumptions used to develop the estimates described above in determining that they are reasonable in relation to the financial statements taken as a whole. Financial statement disclosures Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. There were no particularly sensitive financial statement disclosures. The financial statement disclosures are neutral, consistent, and clear. Significant unusual transactions We identified no significant unusual transactions. Difficulties encountered in performing the audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Uncorrected misstatements Professional standards require us to accumulate all misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management did not identify and we did not notify them of any uncorrected financial statement misstatements. Corrected misstatements Management did not identify and we did not notify them of any financial statement misstatements detected as a result of audit procedures. Disagreements with management For purposes of this communication, a disagreement with management is a disagreement on a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditors’ report. No such disagreements arose during our audit.2 Board of Finance Town of Simsbury, Connecticut Page 3 Management representations We have requested certain representations from management that are included in the management representation letter dated December 16, 2025. Management consultations with other independent accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the Town’s financial statements or a determination of the type of auditors’ opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Significant issues discussed with management prior to engagement We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to engagement as the Town’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our engagement. Required Supplementary Information With respect to the required supplementary information (RSI) accompanying the financial statements, we made certain inquiries of management about the methods of preparing the RSI, including whether the RSI has been measured and presented in accordance with prescribed guidelines, whether the methods of measurement and preparation have been changed from the prior period and the reasons for any such changes, and whether there were any significant assumptions or interpretations underlying the measurement or presentation of the RSI. We compared the RSI for consistency with management’s responses to the foregoing inquiries, the basic financial statements, and other knowledge obtained during the audit of the basic financial statements. Because these limited procedures do not provide sufficient evidence, we did not express an opinion or provide any assurance on the RSI. Supplementary information in relation to the financial statements as a whole With respect to the schedule of expenditures of federal awards (SEFA) and the schedule of expenditures of state financial assistance (SESFA) accompanying the financial statements, on which we were engaged to report in relation to the financial statements as a whole, we made certain inquiries of management and evaluated the form, content, and methods of preparing the SEFA and SESFA to determine that the SEFA and SESFA comply with the requirements of the Uniform Guidance, the method of preparing them has not changed from the prior period or the reasons for such changes, and the SEFA and SESFA are appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the SEFA and SESFA to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We have issued our report thereon dated December 16, 2025.3 Board of Finance Town of Simsbury, Connecticut Page 4 With respect to the supplemental, combining, and individual fund statements and schedules, the tax collectors report, the schedule of changes in sewer use charges receivable, schedule of changes in sewer assessment receivable, and the schedule of debt limitation (collectively, the supplementary information) accompanying the financial statements, on which we were engaged to report in relation to the financial statements as a whole, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period or the reasons for such changes, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We have issued our report thereon dated December 16, 2025. Other information included in annual reports Other information (financial or nonfinancial information other than the financial statements and our auditors’ report thereon) is being included in your annual report and is comprised of the introductory and statistical sections. Our responsibility for other information included in your annual report does not extend beyond the financial information identified in our opinion on the financial statements. We have no responsibility for determining whether such other information is properly stated and do not have an obligation to perform any procedures to corroborate other information contained in your annual report. We are required by professional standards to read the other information included in your annual report and consider whether a material inconsistency exists between the other information and the financial statements because the credibility of the financial statements and our auditors’ report thereon may be undermined by material inconsistencies between the audited financial statements and other information. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. Our auditors’ report on the financial statements includes a separate section, “Other Information,” which states we do not express an opinion or any form of assurance on the other information included in the annual report. We did not identify any material inconsistencies between the other information and the audited financial statements. * * * This communication is intended solely for the information and use of the Board of Finance and management of Town of Simsbury, Connecticut and is not intended to be, and should not be, used by anyone other than these specified parties. West Hartford, Connecticut December 16, 20254 CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLAglobal.com/disclaimer. CliftonLarsonAllen LLP CLAconnect.com Board of Finance Town of Simsbury, Connecticut In planning and performing our audit of the financial statements of the Town of Simsbury, Connecticut (the Town), as of and for the year ended June 30, 2025, in accordance with auditing standards generally accepted in the United States of America, we considered the Town’s internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Town’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Town’s internal control. However, during our audit we became aware of deficiencies in internal control other than significant deficiencies and material weaknesses and other matters that are opportunities to strengthen your internal control and improve the efficiency of your operations. Our comments and suggestions regarding those matters are summarized below. This letter does not affect our report on the financial statements dated December 16, 2025, nor our internal control communication dated December 16, 2025. PRIOR YEAR RECOMMENDATIONS Capital Asset Reporting The implementation of Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statement and Management’s Discussion and Analysis for State and Local Governments, required significant changes to the reporting of capital assets. Although the Town compiled the information for inclusion in the financial statements in accordance with the standard, the Town is maintaining capital assets on stand-alone Excel spreadsheets. Recommendation – Due to the complexity and volume of these assets, we recommend that policies and procedures be developed and formalized to control the operation of the capital asset management system. We also recommend a capital asset inventory be performed to ensure all of the Town’s assets are properly accounted for. Finally, at the end of each year, the Finance Department should work with other department heads to determine any additions or deletions in their department in the current year and also if any assets have been impaired. 2025 Update – The Town has purchased a new accounting system, Munis, which includes a capital asset module. Full implementation estimated during 2026. We will review the status of these comments during our next audit engagement. We have already discussed many of these comments and suggestions with various entity personnel, and we will be pleased to discuss them in further detail at your convenience, to perform any additional study of these matters, or to assist you in implementing the recommendations. * * *5 Board of Finance Town of Simsbury, Connecticut Page 2 This communication is intended solely for the information and use of management, the Board of Finance, the Town Council, others within the organization, and federal and state awarding agencies and pass-through entities, and is not intended to be, and should not be, used by anyone other than these specified parties. West Hartford, Connecticut December 16, 20256 Town of Simsbury Connecticut Annual Comprehensive Financial Report For The Fiscal Year Ended June 30, 20257 Department of Finance Amy Meriwether Director of Finance Annual Comprehensive Financial Report of the TOWN OF SIMSBURY, CONNECTICUT FOR THE FISCAL YEAR ENDED JUNE 30, 20258 TOWN OF SIMSBURY, CONNECTICUT TABLE OF CONTENTS YEAR ENDED JUNE 30, 2025 INTRODUCTORY SECTION LETTER OF TRANSMITTAL I CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING VI PRINCIPAL OFFICIALS VII ORGANIZATION CHART VIII FINANCIAL SECTION INDEPENDENT AUDITORS’ REPORT 1 MANAGEMENT’S DISCUSSION AND ANALYSIS 5 BASIC FINANCIAL STATEMENTS EXHIBITS GOVERNMENT-WIDE FINANCIAL STATEMENTS STATEMENT OF NET POSITION I 18 STATEMENT OF ACTIVITIES II 20 FUND FINANCIAL STATEMENTS GOVERNMENTAL FUNDS BALANCE SHEET III 21 STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES IV 23 PROPRIETARY FUND STATEMENT OF NET POSITION V 25 STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION VI 26 STATEMENT OF CASH FLOWS VII 27 FIDUCIARY FUNDS STATEMENT OF FIDUCIARY NET POSITION VIII 28 STATEMENT OF CHANGES IN FIDUCIARY NET POSITION IX 29 NOTES TO FINANCIAL STATEMENTS 309 TOWN OF SIMSBURY, CONNECTICUT TABLE OF CONTENTS YEAR ENDED JUNE 30, 2025 REQUIRED SUPPLEMENTARY INFORMATION GENERAL FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES – BUDGET AND ACTUAL RSI-1 83 SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES – BUDGET AND ACTUAL RSI-2 86 SEWER OPERATING FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL RSI-3 89 PENSION FUNDS SCHEDULE OF CHANGES IN NET PENSION LIABILITY (ASSET) AND RELATED RATIOS TOWN PENSION PLAN RSI-4A 90 SCHEDULE OF CHANGES IN NET PENSION LIABILITY (ASSET) AND RELATED RATIOS POLICE PENSION PLAN RSI-4B 91 SCHEDULE OF CHANGES IN NET PENSION LIABILITY (ASSET) AND RELATED RATIOS BOARD OF EDUCATION PLAN RSI-4C 92 SCHEDULE OF EMPLOYER CONTRIBUTIONS – TOWN PENSION PLAN RSI-5A 93 SCHEDULE OF EMPLOYER CONTRIBUTIONS – POLICE PENSION PLAN RSI-5B 94 SCHEDULE OF EMPLOYER CONTRIBUTIONS – BOARD OF EDUCATION PLAN RSI-5C 95 SCHEDULE OF INVESTMENT RETURNS – PENSION RSI-6 96 SCHEDULE OF THE TOWN’S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY – TEACHERS RETIREMENT PLAN RSI-7 97 SCHEDULE OF CHANGES IN NET OPEB LIABILITY AND RELATED RATIOS – OPEB RSI-8 98 SCHEDULE OF EMPLOYER CONTRIBUTIONS – OPEB RSI-9 99 SCHEDULE OF INVESTMENT RETURNS – OPEB RSI-10 100 SCHEDULE OF THE TOWN’S PROPORTIONATE SHARE OF THE NET OPEB LIABILITY – TEACHERS RETIREMENT PLAN RSI-11 10110 TOWN OF SIMSBURY, CONNECTICUT TABLE OF CONTENTS YEAR ENDED JUNE 30, 2025 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES GENERAL FUND COMBINING BALANCE SHEET A-1 103 COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE A-2 104 SCHEDULE OF BOARD OF EDUCATION EXPENDITURES – BUDGET AND ACTUAL A-3 105 NONMAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET B-1 109 COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES B-2 112 SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL (NON-GAAP BUDGETARY BASIS B-3 115 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF NET POSITION – PROPRIETARY FUNDS C-1 117 COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION – PROPRIETARY FUNDS C-2 118 COMBINING STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS C-3 119 FIDUCIARY FUNDS COMBINING STATEMENT OF FIDUCIARY NET POSITION – TRUST FUNDS D-1 121 COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION – TRUST FUNDS D-2 122 OTHER SCHEDULES SCHEDULE SCHEDULE OF PROPERTY TAXES LEVIED, COLLECTED, AND OUTSTANDING 1 123 SCHEDULE OF CHANGES IN SEWER USER CHARGES RECEIVABLE 2 124 SCHEDULE OF CHANGES IN SEWER ASSESSMENT RECEIVABLE 3 125 SCHEDULE OF DEBT LIMITATION 4 12611 TOWN OF SIMSBURY, CONNECTICUT TABLE OF CONTENTS YEAR ENDED JUNE 30, 2025 STATISTICAL SECTION TABLES FINANCIAL TRENDS NET POSITION BY COMPONENT 1 128 CHANGES IN NET POSITION 2 129 FUND BALANCES – GOVERNMENTAL FUNDS 3 131 REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES – GOVERNMENTAL FUNDS 4 132 REVENUE CAPACITY ASSESSED VALUE AND ESTIMATED ACTUAL OF TAXABLE PROPERTY 5 134 PRINCIPAL PROPERTY TAXPAYERS 6 135 PROPERTY TAX LEVIES AND COLLECTIONS 7 136 DEBT CAPACITY RATIO OF NET GENERAL BONDED DEBT TO ASSESSED VALUE AND NET GENERAL BONDED DEBT PER CAPITA 8 137 LEGAL DEBT MARGIN INFORMATION 10 139 DEMOGRAPHIC AND ECONOMIC STATISTICS DEMOGRAPHIC AND ECONOMIC STATISTICS 11 140 PRINCIPAL EMPLOYERS 12 141 OPERATING INFORMATION FULL-TIME EQUIVALENT TOWN GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM 13 142 OPERATING INDICATORS BY FUNCTION/PROGRAM 14 143 CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM 15 14412 INTRODUCTORY SECTION13 MARC S. NELSON, MPA AMY MERIWETHER TOWN MANAGER DIRECTOR OF FINANCE/TREASURER FINANCE DEPARTMENT i December 16, 2025 To the Board of Selectmen, Board of Education, Board of Finance, Town Manager, and citizens of the Town of Simsbury: Connecticut State Statutes require that all municipal entities publish within six months of the close of the fiscal year a complete set of financial statements presented in conformity with accounting principles generally accepted in the United States of America (GAAP) and audited in accordance with auditing standards accepted in the United States of America by a firm of licensed certified public accountants. Pursuant to that requirement, we hereby issue the annual comprehensive financial report of the Town of Simsbury, Connecticut for the fiscal year ended June 30, 2025. This report consists of management’s representations concerning the finances of the Town of Simsbury, Connecticut. Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a reasonable basis for making these representations, management of the Town of Simsbury has established a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the Town’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefit, the Town’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The Town’s financial statements have been audited by CliftonLarsonAllen LLP, a firm of licensed certified public accountants. The goal of the independent audit was to provide reasonable assurance that the financial statements of the Town of Simsbury for the fiscal year ended June 30, 2025, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates by management; and evaluating the overall financial statement presentation. The independent auditor concluded based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the Town of Simsbury financial statements for the fiscal year ended June 30, 2025, are fairly presented in conformity with GAAP. The independent auditor’s report is presented as the first component of the financial section of this report.14 ii The independent audit of the financial statements of the Town was part of broader, federal, and state mandated “Single Audits” designed to meet the special needs of federal and state grantor agencies. The standards governing the Federal and State Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the government’s internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal and state awards. These reports are available in the Town of Simsbury’s separately issued Single Audit Reports. GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement MD&A and should be read in conjunction with it. The Town of Simsbury’s MD&A can be found immediately following the report of the independent auditors. Profile of the Government The Town of Simsbury was incorporated as Connecticut’s twenty-first Town in May 1670. It has a land area of approximately 34.5 square miles and a population of approximately 25,353. Centrally located in the heart of the New York - Boston corridor, Simsbury is a most attractive and diverse suburban community. As a part of the beautiful Farmington Valley, Simsbury offers an unmatched quality of life with a traditional New England town atmosphere in a setting of rolling hills, the picturesque Farmington River, and well-manicured properties. Simsbury is conveniently located 20 minutes northwest of Hartford and 20 minutes southwest of Bradley International Airport. The Town of Simsbury operates under a Charter revised as of December 4, 2017. The form of government is Board of Selectmen/Town Manager - Board of Finance - Referendum. There are five Selectmen (2-year term) and a First Selectman (2-year term). There is also an eight-member Board of Education (4-year term) and a six-member Board of Finance (6-year term). Effective December 4, 2017, the Town Manager is the full-time Chief Executive and Chief Administrative Officer of the town - a role formerly performed by the First Selectman/Selectwoman. The legislative authority of the government is vested in the Board of Selectmen. The Charter requires an automatic referendum for the annual budget and for expenditures in excess of 2% of the annual budget. The Town of Simsbury provides a full range of services, including police protection; the construction and maintenance of streets and other infrastructure; recreational activities and cultural events; and a public school system which is one of the finest in the state and national level for excellence. Certain sanitation services are provided by a legally separate Water Pollution Control Authority, which functions in essence as a department of the Town of Simsbury and therefore its operations have been included as an integral part of the Town of Simsbury’s financial statements. Annual Budget Process The budget serves as the foundation of the Town of Simsbury’s financial planning and control. The proposed budget is presented during at least one Board of Finance Public Hearing in April. The proposed budget is subject to an automatic referendum by all qualified voters of the Town to be held from 14 to 21 days after the Board of Finance files the approved budget with the Town Clerk. Should the referendum fail to adopt the budget, the Board of Finance, in cooperation with the Town Manager, Board of Selectmen and Board of Education, shall revise the annual budget, or that portion thereof which has been rejected at the referendum, and present it at a subsequent Board of Finance Public Hearing and referendum for acceptance. If the budget remains unaccepted at the second referendum, the budget adopted for the then current fiscal year becomes the temporary budget on a month-to-month basis until a new budget is adopted.15 iii Local Economy Early in 1994, the Town hired a full-time professional Economic Development Coordinator who formulated a Strategic Plan to guide the Town’s economic development efforts to help stimulate the growth of high-quality development. A fiscal impact study was completed in January 1995 to formulate a development strategy for the future. The Town encourages economic development through financial participation in the construction of roads and infrastructure. Economic development efforts have focused on outreach programs, growing home-based businesses, and marketing various commercial and industrial properties to international corporations. An indicator of the Town’s success in carrying out its economic development plan was the move of the International Skating Center of Connecticut to town. The Center features a twin ice rink Olympic training facility, a professional dance studio, a fully- equipped weight and fitness center, a state-of the-art sound system, a pro shop and lounge, and spectator seating for roughly 1,700 people. More recently, an outdoor Performing Arts Center, able to host a full symphony orchestra, with seating area for 10,000 was completed. The Town supported economic development by constructing the Iron Horse Boulevard, a central downtown street that allows residents and shoppers to move quickly north and south through the Town behind the majority of the Town’s retail establishments without cutting off access to those stores. On the commercial level, the Town’s retail centers include the completely rebuilt Simsbury Commons (formally the Farmington Valley Mall), Drake Hill Mall, Simsbury Town Shoppes, and recently renovated Andy’s Plaza. Dyno Nobel/Ensign-Bickford Industries owns substantial real estate in the Town on which it has developed high quality residential structures and over 235,000 square feet of Class A office and research space. The company’s Powder Forest Business Park has approximately 550 acres for development and its strict design and construction standards ensure a high level of aesthetics in harmony with the surrounding land. The former Hartford Special Machine, Inc., building and its site were purchased by a partnership of developers and is now known as Tower Business Park. The building, originally 68,000 square feet on one floor, was completely renovated and a 51,000 square foot second floor was added for a total of 119,000 square feet of rental office space. A second three-story office building containing 45,000 square feet was added. Currently, both Chubb Executive Risk, Inc., a national insurance company employing about 250-499 people, and Blue Ridge Insurance, employing about 140 people, occupy the site. The Town’s current unemployment rate is 2.0% compared to the State average of 3.8% and the national average of 4.1%. Long-Term Financial Planning The Town and Board of Education has a six-year Capital Improvement Plan which totals approximately $62.5 million, of which is estimated that $30.5 million will be funded through debt and the remainder from the tax levy, grants, and fund balance.16 iv Relevant Financial Policies The Town of Simsbury’s written financial policies are as follows: CNR and Capital Policy Capital Asset Policy Investment Policy Pension Investment Policy and Investment Objectives Defined Contribution Pension Plan Investment Policy Other Post Employment Benefit (OPEB) Trust Investment Policy Policy for Budgetary Transfers and Supplemental Appropriations Structurally Balance Budget Policy Board of Education Non-Lapsing Account Policy Purchasing Policy Fund Balance Policy Debt Policy The Town’s debt policy establishes, as a long-term objective, that debt retirement expenses (interest and principal) be at a rate of not more than 8% of the total annual budget. For the year ended June 30, 2025, the annual debt retirement expense percentage in relation to the total annual budget was 7.41% and therefore in compliance with the Town’s debt policy. Major Initiatives The following major projects were subsequently approved at Referendum on May 9, 2025: $1,700,00 was approved and authorized to be funded via grants and the issuance of bonds for highway pavement management $600,000 was approved and authorized to be funded via the issuance of bonds for a district paving $500,000 was approved and authorized to be funded via the issuance of bonds for a supplemental appropriation for the Eno Hall entrance improvements $450,000 was approved and authorized to be funded via grants and cash for the Tariffville Connection – East Coast Greenway Gap Closure $400,000 was approved and authorized to be funded via the issuance of bonds for the 2 Farms Village Road property renovations $361,000 was approved and authorized to be funded via cash for the installation of septage receiving station $258,000 was approved and authorized to be funded via cash for public works truck replacement and plow $250,000 was approved and authorized to be funded via the issuance of bonds for district security improvements $223,400 was approved and authorized to be funded via the issuance of bonds for sidewalk reconstruction17 v Awards and Acknowledgements The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Town for its annual comprehensive financial report for fiscal year ended June 30, 2024. This was the twenty fourth consecutive year that we have received this prestigious award. In order to be awarded a Certificate of Achievement, the Town must publish an easily readable and efficiently organized annual comprehensive financial report. The report published satisfied both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current annual comprehensive financial report meets the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA to determine its eligibility for a certificate. The preparation of this report was made possible by the dedicated service of the entire staff of the Finance Department. In addition, the accounting firm of CliftonLarsonAllen LLP, made substantial contributions in the development of this document. Due credit also should be given to the Town Manager, Board of Selectmen, Board of Education and the Board of Finance for their cooperation, assistance, and support throughout the year in matters pertaining to the financial affairs of the Town. Respectfully submitted, Amy Meriwether Director of Finance/Treasurer18 vi Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to Town of Simsbury Connecticut For its Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2024 Executive Director/CEO19 vii PRINCIPAL OFFICIALS As of June 30, 2025 BOARD OF SELECTMEN Wendy Mackstutis, First Selectman Steven T. Antonio, Deputy First Selectman Diana A. Yeisley Kevin Beal Heather Goetz Curtis Looney BOARD OF EDUCATION Jeffrey E. Tindall, Chairman Jennifer Batchelar, Vice Chairman Brian M. Watson Jessica Parise Tara Donohue Willerup Josh Falco Lydia A. Tedone Sharon Thomas BOARD OF FINANCE Lisa Heavner, Chairman Arthur H. House, Vice Chairman Robert Helfand Todd S. Burrick Art Wallace Michael Doyle APPOINTED OFFICIALS Marc Nelson, Town Manager Matthew Curtis, Superintendent Amy Meriwether, Director of Finance/Treasurer Patricia Munroe, Town Clerk Sherry Clemens, Tax Collector Francine Beland, Assessor Michael Berry, Director of Civil Preparedness Kristen Formanek, Social Service Director Thomas Tyburski, Director of Culture, Parks & Recreation George McGregor, Director of Planning Joseph Hollis, Conservation Officer Danny Sousa, Building Official Thomas Roy, Town Engineer Updike, Kelley & Spellacy, Town Attorney20 viii21 FINANCIAL SECTION22 CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLAglobal.com/disclaimer. CliftonLarsonAllen LLP CLAconnect.com (1) INDEPENDENT AUDITORS’ REPORT Board of Finance Town of Simsbury, Connecticut Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Town of Simsbury, Connecticut, as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the Town of Simsbury, Connecticut’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, each major fund, and the aggregate remaining fund information of the Town of Simsbury, Connecticut, as of June 30, 2025, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. 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 Town of Simsbury, Connecticut, 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 accounting principles generally accepted in the United States of America, 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 Town of Simsbury, Connecticut’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.23 Board of Finance Town of Simsbury, Connecticut (2) 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 Government Auditing Standards 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 and Government Auditing Standards, 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 Town of Simsbury, Connecticut’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 Town of Simsbury, Connecticut’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.24 Board of Finance Town of Simsbury, Connecticut (3) Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, the budgetary comparison information, and the pension and OPEB schedules, 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. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Town of Simsbury, Connecticut’s basic financial statements. The combining and individual fund financial statements and schedules, the tax collectors report, the schedule of changes in sewer user charges receivable, schedule of changes in sewer assessment receivable, and the schedule of debt limitation are presented for purposes of additional analysis and are 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 combining and individual fund financial statements and schedules, the tax collectors report, the schedule of changes in sewer user charges receivable, schedule of changes in sewer assessment receivable, and the schedule of debt limitation are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.25 Board of Finance Town of Simsbury, Connecticut (4) Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 18, 2025December 16, 2025, on our consideration of the Town of Simsbury, Connecticut’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Town of Simsbury, Connecticut’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Town of Simsbury, Connecticut’s internal control over financial reporting and compliance. West Hartford, Connecticut December 16, 202526 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (5) The management of the Town of Simsbury, Connecticut (the Town) offers readers of the Town’s financial statements this narrative overview and analysis of the financial activities of the Town for the fiscal year ended June 30, 2025. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal. Financial Highlights At the end of the fiscal year the town’s unassigned general fund balance was $20,611,859 or 15.52% of General Fund expenditures. On a government-wide basis, the assets and deferred outflows of resources of the Town exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $164,261,937 for Governmental Activities. As of the close of the current fiscal year, the Town’s Governmental Funds reported combined ending fund balances of $46,738,575, an increase of $4,021,135 in comparison with the prior year. Overview of the Financial Statements This discussion and analysis are intended to serve as an introduction to the Town’s basic financial statements. The Town’s basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-Wide Financial Statements The government-wide financial statements are designed to provide readers with a broad overview of the Town’s finances, in a manner similar to a private-sector business. The statement of net position presents information on all of the Town’s assets, deferred outflows of resources, liabilities and deferred inflows of resources, 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 Town is improving or deteriorating. The statement of activities presents information showing how the Town’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in a future fiscal period (e.g., uncollected taxes and earned but unused vacation leave). The government-wide financial statements distinguish functions of the Town that are principally supported by taxes and intergovernmental revenues (governmental activities). The governmental activities of the Town include general government, planning and development, public safety, facility management, culture and recreation, health, insurances, education, special projects and long-term debt. The government-wide financial statements can be found on pages 18 to 20 of this report.27 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (6) Fund Financial Statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Town, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the Town can be divided into three categories: Governmental Funds, Proprietary Funds and Fiduciary Funds. Governmental Funds - Governmental Funds are used to account for essentially the same functions reported as Governmental Activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of Governmental Funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for Governmental Funds with similar information presented for Governmental Activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between Governmental Funds and Governmental Activities. The Town maintains 51 individual funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General Fund, Sewer Use Fund, BOE Programs Fund, Capital Project Fund and the BOE Grants Fund, all of which are considered to be major funds. Data from the other 47 governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report. The Town adopts an annual appropriated budget for its General Fund and three of its special revenue funds, Sewer Fund, Residential Rental Properties Fund and Simsbury Farms Fund. Budgetary comparison schedules have been provided for all four funds to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 21 to 24 of this report. Proprietary Funds - The Town maintains a Self-Insurance Fund to account for the self-insurance program for health insurance coverage for the Town and Board of Education employees. The basic proprietary fund financial statements can be found on pages 25 to 27 of this report. Fiduciary Funds - Fiduciary Funds are used to account for resources held for the benefit of parties outside the government. Fiduciary Funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the Town’s own programs. The accounting used for Fiduciary Funds is much like that used for Proprietary Funds. The basic fiduciary fund financial statements can be found on pages 28 to 29 of this report.28 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (7) Notes to the Financial Statements The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 30 to 82 of this report. Required Supplementary Information This report contains certain supplementary information concerning the Town’s compliance with legally adopted budgets for the General Fund and Sewer Fund, a major special revenue fund, as well as progress in funding its obligation to provide pension benefits and other post-employment benefits to its employees. Other Information The combining statements referred to earlier in connection with nonmajor governmental funds are presented following the notes to the financial statements. Combining and individual fund statements and schedules can be found on pages 103 to 122 of this report. Government-Wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position and an important determinant of its ability to finance services in the future. In the case of the Town, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $164,261,937 at the close of the most recent fiscal year. By far, the largest portion of the Town’s net position is its net investment in capital assets (e.g., land, buildings, machinery and equipment). It is presented in the statement of net position less any related debt used to acquire those assets to provide services to citizens; consequently, these assets are not available for future spending. Although the Town’s investment in its capital assets, net of accumulated depreciation, is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.29 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (8) NET POSITION - GOVERNMENTAL ACTIVITIES 2025 2024 Current assets 69,082,218$ 67,175,522$ Capital assets, net of accumulated depreciation 194,502,251 188,221,597 Noncurrent assets 1,721,894 826,200 Total Assets 265,306,363 256,223,319 Deferred Outflow of Resources 3,275,016 6,332,666 Current liabilities 14,439,247 19,475,343 Noncurrent liabilities 79,296,217 77,217,221 Total Liabilities 93,735,464 96,692,564 Deferred Inflow of Resources 10,583,978 10,628,657 Net Position: Net investment in capital assets 138,142,206 132,832,347 Restricted 6,742,383 2,929,088 Unrestricted 19,377,348 19,473,329 Total Net Position 164,261,937$ 155,234,764$ Governmental Activities The government’s net position increased by $9,027,173 or 5.82% during the current fiscal year from $155,234,764 at June 30, 2024 to $164,261,937 at June 30, 2025. Unrestricted net position, the part of net position that can be used to finance day-to-day operations without constraints established by debt covenants, enabling legislation or other legal requirements, is $19,377,348 at the end of this year compared to $19,473,329 at the end of the prior year for a decrease of $95,981.30 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (9) CHANGES IN NET POSITION - GOVERNMENTAL ACTIVITIES 2025 2024 Revenues: Program revenues: Charges for services 14,316,055$ 13,192,788$ Operating grants and contributions 35,939,898 36,745,511 Capital grants and contributions 3,581,203 6,974,517 General revenues: Property taxes 110,670,604 105,826,243 Grants and contributions not restricted to specific purpose 399,298 1,109,714 Unrestricted investment earnings 3,227,801 3,256,143 Other general revenues, net 1,842,350 1,561,182 Total revenues 169,977,209 168,666,098 Program expenses: General government 4,173,660 5,831,578 Planning and development 1,012,455 1,030,550 Public safety 15,264,443 9,935,901 Facility management 11,821,911 11,977,395 Culture and recreation 7,414,445 7,525,114 Health and welfare 1,365,602 1,372,288 Education 118,415,464 110,210,833 Interest on long-term debt 1,482,056 1,658,235 Total expenses 160,950,036 149,541,894 Change in net position 9,027,173 19,124,204 Net Position - July 1 155,234,764 136,110,560 Net Position - June 30 164,261,937$ 155,234,764$ Governmental Activities Total revenues were $169,977,209 and $168,666,098 for the years ended June 30, 2025 and 2024, respectively. Total cost of all programs and services were $160,950,036, and $149,541,894, respectively, for the years ended June 30, 2025 and 2024. Net position increased by $9,027,173 for the year ended June 30, 2025, while net position increased by $19,124,204 for the year ended June 30, 2024.31 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (10) Revenue by Source - Governmental Activities Capital Grants and Contributions, 3,581,203 , 2.11% Charges for Services, 14,316,055 , 8.42% Operating Grants and Contributions,…Other General Revenues, net, 1,842,350 , 1.08% Property Taxes, 110,670,604 , 65.11% Unrestricted Grants and… Unrestricted Investment Earnings, 3,227,801 , 1.90% Governmental Activities Major revenue factors during the year include: • Property taxes collected increased by $4,844,361 or 4.58% mainly due the increased mill rate in the current year, budgeted a tax collection rate of 98.5% when actual collections came in at 99.5% and conservatively budgeted our motor vehicle supplemental tax revenue.32 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (11) • Charges for goods and services increased by $1,123,267 or 8.51% mainly related to decreased conveyance fees and police private duty charges, which were offset by increased building permit fees, sewer assessments, new golf and clubhouse surcharges, student activity revenues, continuing ed revenues and preschool revenues. Illustrated below is a comparison between 2025 and 2024: 2025 2024 Variance General government 928,286$ 1,030,944$ (102,658)$ Planning and development 42,818 41,289 1,529 Public safety 414,314 516,290 (101,976) Facility management 4,964,772 4,231,735 733,037 Culture and recreation 2,705,048 2,611,188 93,860 Health and welfare 28,663 12,231 16,432 Education 5,232,154 4,749,111 483,043 Total 14,316,055$ 13,192,788$ 1,123,267$ • Operating grants and contributions decreased by $805,613 mainly due to a decrease in the motor vehicle state reimbursement, ARPA funding, and educational grants offset by increases in excess cost revenue, the state teacher’s retirement and state funded capital project payments: 2025 2024 Variance General government 409,572$ 6,327,584$ (5,918,012)$ Planning and development 1,886,602 1,476,853 409,749 Public safety 6,431 710,195 (703,764) Facility management 58,785 2,378 56,407 Culture and recreation 45,329 33,232 12,097 Health and welfare 74,743 61,542 13,201 Education 33,458,436 28,133,727 5,324,709 Total 35,939,898$ 36,745,511$ (805,613)$ • Capital grants and contributions decreased by $3,393,314 mainly due to the Latimer Lane renovate as new construction project as it nears completion. Illustrated below is a breakdown comparison between 2025 and 2024: 2025 2024 Variance Facility management 802,403$ 663,417$ 138,986$ Education 2,778,800 6,311,100 (3,532,300) Total 3,581,203$ 6,974,517$ (3,393,314)$33 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (12) The following table presents the cost of each of the Town’s programs as well as each program’s net cost (total cost less revenues generated by the activities). The net cost shows the financial burden that was placed on the Town’s taxpayers by each of these functions. GOVERNMENTAL ACTIVITIES For the Year Ended June 30, 2025 Total Cost Net Cost of Services of Services General government 4,173,660$ (2,835,802)$ Planning and development 1,012,455 916,965 Public safety 15,264,443 (14,843,698) Facility management 11,821,911 (5,995,951) Culture and recreation 7,414,445 (4,664,068) Health and welfare 1,365,602 (1,262,196) Education 118,415,464 (76,946,074) Interest on long-term debt 1,482,056 (1,482,056) Total 160,950,036$ (107,112,880)$34 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (13) Expenses and Net Cost of Services - Governmental Activities - 20,000,000 40,000,000 60,000,000 80,000,000 100,000,000 120,000,000 140,000,000 Total Cost of Services Financial Analysis of the Government’s Funds As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance- related legal requirements. Governmental Funds The focus of the Town’s Governmental Funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the Town’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.35 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (14) As of the end of the current fiscal year, the Town’s Governmental Funds reported combined ending fund balances of $46,738,575 representing an increase of $4,021,135 or 9.41% in comparison with the prior year. Of this total amount, $728,753 is nonspendable, $2,981,601 is restricted by governmental grants, $22,436,765 is committed by purpose as determined by the fund that holds the dollars, $21,137 is assigned and $20,570,319 is unassigned. The $20,570,319 unassigned fund balance is available for spending at the Town’s discretion. The total unassigned fund balance is based on a positive general fund balance in that amount. The General Fund is the chief operating fund of the Town. At the end of the current fiscal year, the unassigned fund balance for the General Fund was $20,611,859, while total fund balance was $21,848,684. As a measure of the general fund’s liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Of this total fund balance $355,664 is nonspendable, $21,137 is assigned, and $860,024 is committed, with the balance being unassigned in the amount the $20,611,859. The total fund balance of the Town’s General Fund increased by $180,435 during the current fiscal year and the unassigned fund balance decreased by $11,329. See “General Fund Budgetary Highlights” below for analysis for notable General Fund activity during the year. The Sewer Use Fund has a fund balance of $6,317,281 at the end of the year, an increase of $301,914 from the prior year. The intention is to have the accumulating fund balance be used to help pay offset debt service on the next Waste Water Treatment Plant renovation when mandated. The majority of the increase to fund balance relates to assessment fees and utility savings. The Board of Education Programs Fund has a fund balance of $990,935 at the end of the year, presenting an increase of $256,268 over the prior year fund balance of $734,667. Fund balance increased mainly related to transfers into the fund to cover costs related to the Farmington Valley Transition Academy. The Board of Education Grants Fund has a fund balance of ($29,540) at the end of the year, an increase of $278,550 over the prior year fund balance of (308,090). The increase to fund balance is mainly related to the timing of a payment from the City of Hartford for Open Choice student reimbursement where the expenditures were incurred in the prior year but revenue received in the current year. The Capital Project Fund has a fund balance of $9,295,044 at the end of the year, representing an increase of $1,798,182 over the prior year fund balance of $7,496,862. Fund balance increased as a result of borrowing for bonded projects in the current year off set by decreased grant payments as a result of completed projects, in particular, the Latimer Lane Renovate as New project. Other nonmajor governmental funds have a total fund balance of $8,316,171, representing an increase of $1,205,786 from the prior year as illustrated.36 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (15) Nonmajor Governmental Funds 2025 2024 Variance Residential Rental Properties 586,778$ 524,918$ 61,860$ Simsbury Farms Fund 926,738 814,594 112,144 General Government Program Fund 183,049 159,140 23,909 Public Safety Program Fund 120,480 127,623 (7,143) Planning & Development Program Fund 321,218 304,328 16,890 Facilities Management Program Fund 333,984 260,991 72,993 Health & Welfare Program Fund 679,309 593,419 85,890 Culture & Recreation Program Fund 71,407 31,683 39,724 Sewer Assessment Fund 1,146,771 900,392 246,379 Cafeteria 433,343 503,374 (70,031) Capital and Nonrecurring Expenditures Fund 2,815,277 2,295,270 520,007 Student Activity 439,499 409,874 29,625 Flex Spending Fund 23,962 29,243 (5,281) Continuing Education 226,923 134,551 92,372 Enrichment & Extended Day 7,433 20,985 (13,552) Total 8,316,171$ 7,110,385$ 1,205,786$ General Fund Budgetary Highlights The original general fund budget including other financing sources and uses of $122,740,407 was increased by $2,002,936 to the final budget of $124,743,343 mainly due to the following: About $1M of net savings in salaries and benefits in various departments including: Town Manager, Tax, Town Clerk, Police, Dispatch, Planning, Building, Public Works and the Library related to vacant positions and staff turnover. $111,413 savings in Education expenditures ($63,580) deficit in legal services due to increased expenditures for contract negotiations ($35,025) deficit from an unanticipated heart and hypertension claim payout ($3,008,000) contribution to the capital reserve fund Actual revenues were more than budgetary estimates by $2,033,276 mainly related to the following: $863,399 in increased tax collections due to a conservative tax collection rate and supplemental motor vehicle budget $769,500 in increased investment income $526,282 in increased building permit fees $82,402 in increased school building rentals $22,500 in increased contribution from the capital reserve fund ($250,000) designated fund balance that was not utilized37 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (16) Capital Asset and Debt Administration Capital Assets - The Town’s investment in capital assets (net of accumulated depreciation) for its governmental activities as of June 30, 2025 amounted to $194,502,251. This investment in capital assets included land, buildings and system improvements, machinery and equipment, park facilities, roads, highways, and bridges. The total net change in the Town's investment in capital assets for the current fiscal year was an increase of $6,280,654. Capital Asset and Debt Administration Capital Assets - The Town’s investment in capital assets (net of accumulated depreciation) for its governmental activities as of June 30, 2025 amounted to $194,502,251. This investment in capital assets included land, buildings and system improvements, machinery and equipment, park facilities, roads, highways, and bridges. The total net change in the Town's investment in capital assets for the current fiscal year was an increase of $6,280,654. CAPITAL ASSETS (Net of Depreciation) June 30, 2025 Land 15,800,256$ Development rights 11,725,000 Construction in progress 43,898,451 Buildings and improvements 93,790,013 Land improvements 6,638,141 Equipment 8,996,277 Infrastructure 13,654,113 Total 194,502,251$ Additional information on the Town’s Capital Assets can be found in Note 3C on pages 46 to 47 of this report. Long-term Debt - At the end of the current fiscal year, the Town had total bonded debt outstanding of $55,300,000, of which $7,160,000 is due within one year. All of the debt is backed by the full faith and credit of the Town.38 TOWN OF SIMSBURY, CONNECTICUT MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) JUNE 30, 2025 (17) OUTSTANDING DEBT June 30, 2025 General obligation bonds 55,300,000$ Total 55,300,000$ The Town’s total debt increased during the current fiscal year by $5,750,000. The increase was a result of issue debt for previously approved capital projects. The Town has an “Aaa” rating from Standard and Poor’s and Moody’s for general obligation debt. State statutes limit the amount of general obligation debt a governmental entity may issue to 7.0 times its total prior years’ tax collections. The current debt limitation for the Town is $748,559,931 which is significantly more than the Town’s outstanding general obligation debt. Additional information on the Town’s long-term debt can be found in Note 3F on pages 49 to 51 of this report. Economic Factors and Next Year’s Budgets and Rates The Town’s elected Board of Finance considered many factors when setting the fiscal year 2025/26 budget spending guideline and mill rate. Factors included the economy, consumer price index, comparative town data, and the State budget situation. The current unemployment rate for the Town of Simsbury is 2.9%. This compares to the State’s average unemployment rate of 3.8% and the national average rate of 4.4%. Requests for Information This financial report is designed to provide a general overview of the Town’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Office of the Director of Finance/Treasurer for the Town of Simsbury.39 BASIC FINANCIAL STATEMENTS40 EXHIBIT I TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF NET POSITION JUNE 30, 2025 See accompanying Notes to Financial Statements. (18) Governmental Activities ASSETS Current Assets: Cash and Cash Equivalents 50,660,396$ Investments 684,176 Accounts Receivable, Net 15,739,633 Loans Receivable 361,260 Supplies 87,477 Prepaid Items 1,549,276 Total Current Assets 69,082,218 Noncurrent Assets: Capital Assets: Nondepreciable 71,423,707 Depreciable, Net 123,078,544 Loans Receivable 464,940 Net OPEB Asset 1,256,954 Total Noncurrent Assets 196,224,145 Total Assets 265,306,363 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows Related to Pension 952,167 Deferred Outflows Related to OPEB 2,121,010 Deferred Charge on Refunding 201,839 Total Deferred Outflows of Resources 3,275,01641 EXHIBIT I (CONTINUED) TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF NET POSITION (CONTINUED) JUNE 30, 2025 See accompanying Notes to Financial Statements. (19) Governmental Activities LIABILITIES Current Liabilities: Accounts Payable 3,059,037$ Accrued Interest Payable 640,454 Unearned Revenues 1,172,663 Claims liabilities Bonds and Loans Payable 7,160,000 Compensated Absences 1,249,293 Claims Liability 1,152,800 Landfill Post Closure 5,000 Total Current Liabilities 14,439,247 Noncurrent Liabilities: Bonds and Loans Payable 51,275,756 Net Pension Liability 27,505,510 Compensated Absences 504,951 Landfill Post Closure 10,000 Total Noncurrent Liabilities 79,296,217 Total Liabilities 93,735,464 DEFERRED INFLOWS OF RESOURCES Deferred Inflows Related to Leases 2,484,961 Deferred Inflows Related to Pension 1,336,293 Deferred Inflows Related to OPEB 6,762,724 Total Deferred Inflows of Resources 10,583,978 NET POSITION Net Investment in Capital Assets 138,142,206 Restricted for: Grants 4,592,920 Education Trusts 37,138 Facility Management Trusts 30,503 Health and Welfare Trusts 127,051 Net OPEB Asset 1,256,954 Education and Youth Services 697,817 Unrestricted 19,377,348 Total Net Position 164,261,937$42 EXHIBIT II TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (20) Net Revenues (Expenses) and Changes in Net Position Operating Capital Charges for Grants and Grants and Governmental Function/Program Activities Expenses Services Contributions Contributions Activities PRIMARY GOVERNMENT Governmental Activities: General Government 4,173,660$ 928,286$ 409,572$ -$ (2,835,802)$ Planning and Development 1,012,455 42,818 1,886,602 - 916,965 Public Safety 15,264,443 414,314 6,431 - (14,843,698) Facility Management 11,821,911 4,964,772 58,785 802,403 (5,995,951) Culture and Recreation 7,414,445 2,705,048 45,329 - (4,664,068) Health and Welfare 1,365,602 28,663 74,743 - (1,262,196) Education 118,415,464 5,232,154 33,458,436 2,778,800 (76,946,074) Interest on Long-Term Debt 1,482,056 - - - (1,482,056) Total Governmental Activities 160,950,036$ 14,316,055$ 35,939,898$ 3,581,203$ (107,112,880) GENERAL REVENUES Property Taxes, Levied for General Purposes 110,670,604 Grants and Contributions Not Restricted to Specific Programs 399,298 Unrestricted Investment Earnings 3,227,801 Other General Revenues 1,842,350 Total General Revenues 116,140,053 CHANGE IN NET POSITION 9,027,173 Net Position - Beginning of Year 155,234,764 NET POSITION - END OF YEAR 164,261,937$ Program Revenues43 EXHIBIT III TOWN OF SIMSBURY, CONNECTICUT BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2025 See accompanying Notes to Financial Statements. (21) State and Sewer BOE Capital Federal Nonmajor Total General Use Programs Project Education Governmental Governmental Fund Fund Fund Fund Grants Funds Funds ASSETS Cash and Cash Equivalents 20,508,036$ 6,228,565$ -$ 9,262,470$ -$ 9,018,839$ 45,017,910$ Investments - - 684,176 - - - 684,176 Receivables, Net 5,443,775 961,050 465,241 4,393,218 3,214,350 2,087,974 16,565,608 Due from Other Funds 2,824,364 - - - - - 2,824,364 Supplies - - - - - 87,477 87,477 Prepaid Items 355,664 3,596 2,329 258,107 12,000 9,580 641,276 Total Assets 29,131,839$ 7,193,211$ 1,151,746$ 13,913,795$ 3,226,350$ 11,203,870$ 65,820,811$ LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES LIABILITIES Accounts Payable 1,775,425$ 4,918$ 123,507$ 296,021$ 621,411$ 237,755$ 3,059,037$ Due to Other Funds - - 37,304 - 2,574,063 212,997 2,824,364 Unearned Revenue 581,812 - - - - 590,851 1,172,663 Total Liabilities 2,357,237 4,918 160,811 296,021 3,195,474 1,041,603 7,056,064 DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Property Taxes 1,746,569 - - - - - 1,746,569 Unavailable Revenue - Property Tax Interest 777,871 - - - - - 777,871 Unavailable Revenue - Sewer Assessments - - - - - 1,668,036 1,668,036 Unavailable Revenue - Sewer Tax Interest - 9,982 - - - - 9,982 Unavailable Revenue - Other Districts - 826,200 - - - - 826,200 Unavailable Revenue - Grants - - - 4,322,730 60,416 72,838 4,455,984 Unavailable Revenue - Other - 34,830 - - - - 34,830 Unavailable Revenue - Small Cities Loans - - - - - 21,739 21,739 Deferred Inflows Related to Leases 2,401,478 - - - - 83,483 2,484,961 Total Deferred Inflows of Resources 4,925,918 871,012 - 4,322,730 60,416 1,846,096 12,026,172 FUND BALANCES Nonspendable 355,664 3,596 2,329 258,107 12,000 97,057 728,753 Restricted - - 37,138 1,818,902 - 1,125,561 2,981,601 Committed 860,024 6,313,685 951,468 7,218,035 - 7,093,553 22,436,765 Assigned 21,137 - - - - - 21,137 Unassigned 20,611,859 - - - (41,540) - 20,570,319 Total Fund Balances 21,848,684 6,317,281 990,935 9,295,044 (29,540) 8,316,171 46,738,575 Total Liabilities, Deferred Inflows of Resources, and Fund Balances 29,131,839$ 7,193,211$ 1,151,746$ 13,913,795$ 3,226,350$ $ 11,203,870$ 65,820,811$44 EXHIBIT III (CONTINUED) TOWN OF SIMSBURY, CONNECTICUT BALANCE SHEET GOVERNMENTAL FUNDS (CONTINUED) JUNE 30, 2025 See accompanying Notes to Financial Statements. (22) RECONCILIATION TO THE STATEMENT OF NET POSITION Amounts reported for governmental activities in the statement of net position (Exhibit I) are different because of the following: Total Fund Balances - Governmental Funds (Exhibit III) 46,738,575$ Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds: Governmental Capital Assets 339,036,493 Less: Accumulated Depreciation (144,534,242) Net Capital Assets 194,502,251 Other long-term assets and deferred outflows of resources are not available to pay for current-period expenditures and, therefore, are deferred in the funds: Loans Receivable from Small Cities 21,739 Loans Receivable from Other Districts 826,200 Receivable from Grants 4,455,984 Receivable from Other 34,830 Property Tax Receivables Greater than 60 Days 2,524,440 Sewer Assessments Receivable 1,668,036 Net OPEB Asset 1,256,954 Interest Receivable on Sewer Use Receivable 9,982 Deferred Outflows Related to Pension 952,167 Deferred Outflows Related to OPEB 2,121,010 Internal service funds are used by management to charge the costs of risk management to individual funds. The assets and liabilities of the internal service funds are reported with governmental activities in the statement of net position. 5,397,911 Long-term liabilities, including deferred inflows of resources, are not due and payable in the current period and, therefore, are not reported in the funds: Bonds Payable (55,300,000) Unamortized Bond Premium (3,135,756) Deferred Charge on Refunding 201,839 Interest Payable on Bonds (640,454) Compensated Absences (1,754,244) Net Pension Liability (27,505,510) Deferred Inflows Related to Pension (1,336,293) Deferred Inflows Related to OPEB (6,762,724) Landfill Liability (15,000) Net Position of Governmental Activities (Exhibit I) 164,261,937$45 EXHIBIT IV TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (23) State and Sewer BOE Capital Federal Nonmajor Total General Use Programs Project Education Governmental Governmental Fund Fund Fund Fund Grants Funds Fund REVENUES Property Taxes 110,108,472$ -$ -$ -$ -$ -$ 110,108,472$ Intergovernmental 21,630,933 397,239 494,367 3,338,306 8,427,939 1,397,051 35,685,835 Investment Income (Loss) 2,894,500 151,120 83,250 - - 98,931 3,227,801 Charges for Goods and Services 1,470,354 - - 17,856 - 7,563,099 9,051,309 Licenses and Permits 1,347,394 - - - - - 1,347,394 Rental of Town-Owned Property 190,079 - - - - 56,157 246,236 Local Revenues 32,416 - - - - - 32,416 Assessments - 3,462,429 - - - 176,271 3,638,700 Other 52,666 793,581 232,145 325,107 - 438,851 1,842,350 Total Revenues 137,726,814 4,804,369 809,762 3,681,269 8,427,939 9,730,360 165,180,513 EXPENDITURES Current: General Government 4,874,399 - - - - 164,362 5,038,761 Planning and Development 1,009,363 - - - - 9,890 1,019,253 Public Safety 9,163,344 - - - - 359,163 9,522,507 Facility Management 6,121,129 2,780,701 - - - 98,444 9,000,274 Culture and Recreation 4,364,456 - - - - 2,503,607 6,868,063 Health and Welfare 1,118,767 - - - - 190,294 1,309,061 Education 98,153,071 - 884,880 - 8,149,389 4,994,667 112,182,007 Capital Outlay - - - 17,412,226 - 3,285,457 20,697,683 Debt Service: Principal Payments 6,162,680 1,060,000 - - - 2,769 7,225,449 Interest and Other 1,869,870 154,000 - 46,950 - (2,769) 2,068,051 Total Expenditures 132,837,079 3,994,701 884,880 17,459,176 8,149,389 11,605,884 174,931,109 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES 4,889,735 809,668 (75,118) (13,777,907) 278,550 (1,875,524) (9,750,596) OTHER FINANCING SOURCES (USES) Transfers In 613,797 69,404 331,386 5,925,045 - 3,770,739 10,710,371 Transfers Out (5,323,097) (577,158) - (4,120,687) - (689,429) (10,710,371) Premium on Bond Issuance - - - 921,731 - - 921,731 Bond Issuance - - - 12,850,000 - - 12,850,000 Total Other Financing Sources (Uses) (4,709,300) (507,754) 331,386 15,576,089 - 3,081,310 13,771,731 NET CHANGE IN FUND BALANCES 180,435 301,914 256,268 1,798,182 278,550 1,205,786 4,021,135 Fund Balances - Beginning of Year 21,668,249 6,015,367 734,667 7,496,862 (308,090) 7,110,385 42,717,440 FUND BALANCES - END OF YEAR 21,848,684$ 6,317,281$ 990,935$ 9,295,044$ (29,540)$ 8,316,171$ 46,738,575$46 EXHIBIT IV (CONTINUED) TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES (CONTINUED) GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (24) RECONCILIATION TO THE STATEMENT OF ACTIVITIES Net Change in Fund Balances - Total Governmental Funds (Exhibit IV) 4,021,135$ Governmental funds report capital outlays 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 13,473,247 Depreciation Expense (7,115,225) Loss on disposal of capital assets (77,368) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds, and revenues recognized in the funds are not reported in the statement of activities: Property Taxes Collected After 60 Days 562,132 Sewer Assessment Revenue (175,052) Loans Receivable from Other Districts (343,440) OPEB Asset 1,683,995 Receivable from Grants 2,210,453 Receivable from Other (17,846) Deferred Outflows Related to Pension (2,394,818) Deferred Outflows Related to OPEB (587,142) The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on 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. This amount is the net effect of these differences in the treatment of long-term debt and related items. Bond Issuance (12,850,000) Premium on Bonds Issued (921,731) Premium Amortization 769,309 Accrued Interest 15,056 Principal Payments on Bonds 7,100,000 Principal Payments on Notes 2,769 Pension Liability 3,454,706 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. Deferred Charge on Refunding (75,690) Deferred Inflows Related to Pension (661,762) Deferred Inflows Related to OPEB 579,304 Change in Long-Term Compensated Absences (256,582) Other - Landfill 5,000 The net profit (loss) of the internal service funds is reported with governmental activities. 626,723 Change in Net Position of Governmental Activities (Exhibit II) 9,027,173$47 EXHIBIT V TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF NET POSITION PROPRIETARY FUND JUNE 30, 2025 See accompanying Notes to Financial Statements. (25) Governmental Activities Health & Dental Insurance Fund ASSETS Current Assets: Cash and Cash Equivalents 5,642,486$ Accounts receivable, net 225 Prepaid Items 908,000 Total Current Assets 6,550,711 LIABILITIES Current Liabilities: Claims Incurred but Not Reported 1,152,800 NET POSITION Unrestricted 5,397,911$48 EXHIBIT VI TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION PROPRIETARY FUND YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (26) Governmental Activities Health & Dental Insurance Fund OPERATING REVENUES Charges for Services 16,721,598$ Other Operating Revenue 799,927 Miscellaneous 69,908 Total Operating Revenues 17,591,433 OPERATING EXPENSES Claims Incurred 15,706,369 Administration and Stop Loss Insurance Fees 1,258,341 Total Operating Expenses 16,964,710 CHANGE IN NET POSITION 626,723 Net Position - Beginning of Year 4,771,188 NET POSITION - END OF YEAR 5,397,911$49 EXHIBIT VII TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF CASH FLOWS PROPRIETARY FUND YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (27) Governmental Activities Health & Dental Insurance Fund CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Customers and Users 17,169,208$ Cash Paid for Claims (16,835,810) Net Cash Provided by Operating Activities 333,398 Cash and Cash Equivalents - Beginning of Year 5,309,088 CASH AND CASH EQUIVALENTS - END OF YEAR 5,642,486$ RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating Income 626,723$ Adjustments to Reconcile Operating Income to Net Cash Provided by Operating Activities: Decrease in accounts receivable (225) (Increase) Decrease in Prepaid Items (422,000) Increase (Decrease) in Claims Payable 128,900 Total Adjustments (293,325) Net Cash Provided by Operating Activities 333,398$50 EXHIBIT VIII TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS JUNE 30, 2025 See accompanying Notes to Financial Statements. (28) Pension and Other Employee Benefit Trust Funds ASSETS Cash and Cash Equivalents 1,316,834$ Investments, at Fair Value: Mutual Funds 108,032,385 Private Equity Funds 3,772,650 Accounts Receivable 62,693 Total Assets 113,184,562 NET POSITION Restricted for Pension Benefits 86,079,695 Restricted for OPEB Benefits 27,104,867 Total Net Position 113,184,562$51 EXHIBIT IX TOWN OF SIMSBURY, CONNECTICUT STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2025 See accompanying Notes to Financial Statements. (29) Pension and Other Employee Benefit Trust Funds ADDITIONS: Contributions: Employer 5,289,506$ Plan Members 923,257 Total Contributions 6,212,763 Investment Income: Net Change in Fair Value of Investments 8,414,291 Interest 3,102,449 Total Investment Income 11,516,740 Less Investment Expenses: Investment Management Fees (91,355) Net Investment Income 11,425,385 Total Additions 17,638,148 DEDUCTIONS: Benefits 8,129,786 Administrative Expense 222,118 Total Deductions 8,351,904 CHANGE IN NET POSITION 9,286,244 Net Position - Beginning of Year 103,898,318 NET POSITION - END OF YEAR 113,184,562$52 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (30) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Reporting Entity The Town of Simsbury, Connecticut (the Town) operates under a charter as revised November 8, 2016, effective December 4, 2017. The Town is governed by an elected Board of Selectmen consisting of a first selectman and five other members, an elected eight-member Board of Education, and an elected six-member Board of Finance. The Board of Selectmen appoints a Town Manager who shall be the chief executive and the administrative official of the Town and shall serve at the pleasure of the Board of Selectmen. The Town Manager is appointed on the basis of executive and administrative qualifications, character, education, training, and experience. The Town Manager devotes full working time to the duties of the office. The Town Manager is responsible to the Board of Selectmen for carrying out all acts and policies of the Board of Selectmen, and all resolutions and ordinances adopted by the Town. The Town Manager is responsible for the administration of the Town consistent with the policies established by the Board of Selectmen and for carrying out such other duties and responsibilities as set forth in the Charter. The financial statements include all of the funds of the Town that meet the criteria issued by the Governmental Accounting Standards Board (GASB). GAAP requires that the reporting entity include the primary government, organizations for which the primary government is financially accountable, and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. A government is financially accountable for a legally separate organization if it appoints a voting majority of the organization’s governing body and there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on, the government. These criteria have been considered and have resulted in the inclusion of the fiduciary component units as detailed below. Fiduciary Component Units The Town has established three single-employer Public Retirement Systems (PERS) plans and one postretirement health care benefits (OPEB) plan to provide retirement benefits and postretirement health care benefits primary to employees and their beneficiaries. The Town performs the duties of a governing board for the Pension and OPEB plans and is required to make contributions to the pension and OPEB plans. The financial statements of the fiduciary component units are reported as Pension and OPEB Trust fund in the fiduciary fund financial statements. Separate financial statements have not been prepared for the fiduciary component units.53 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (31) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basis of Presentation The accompanying financial statements have been prepared in conformity with GAAP as applied to government units. The GASB is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the Town’s accounting policies are described below. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the Town. Interfund services provided and used are not eliminated in the process of consolidation. Governmental activities are normally supported by taxes and intergovernmental revenues. The statement of activities demonstrates the degree to which the 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. Certain indirect costs are allocated as part of the program expense reported for individual functions and activities and are not eliminated in the process of consolidation. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds are reported as separate columns in the fund financial statements. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Revenues are recorded when earned, and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. 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. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Town considers revenues to be available if they are collected within 60 days of the end of the current fiscal period.54 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (32) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basis of Presentation (Continued) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) Property taxes, licenses, and interest associated with the current fiscal period are all considered to be susceptible to accrual and have been recognized as revenues of the current fiscal period. In determining when to recognize intergovernmental revenues (grants and entitlements), the legal and contractual requirements of the individual programs are used as guidance. Revenues are recognized when the eligibility requirements have been met. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the Town. 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 and claims and judgments, are recorded only when payment is due. The Town reports the following major governmental funds: General Fund The General Fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. Sewer Use Fund The Sewer Use Fund is the sewer treatment plant primary operating fund. It accounts for all financial resources associated with the operations of the sewer treatment plant. The major sources of revenue for this fund are sewer assessments and use charges. Board of Education Program Fund The Board of Education Program Fund accounts for Board of Education programs including district activity for the Kathleen Magowan Revocable Trust, the Farmington Valley Transitional Academy, and other scholarship donations, gifts, and distributions of trust income. Capital Project Fund The Capital Project Fund accounts for financial resources to be used for capital expenditures or for the acquisition or construction of capital facilities, improvements and/or equipment. Capital projects of greater than one year’s duration have been accounted for in the Capital Project Fund. Most of the capital outlays are financed by the issuance of general obligation bonds. Other sources include capital grants, current tax revenues and low-interest state loans.55 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (33) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basis of Presentation (Continued) State and Federal Education Grants The State and Federal Education Grants Fund is used to account for and report financial resources that are restricted, committed or assigned to expenditure for educational purposes. Additionally, the Town reports the following fund types: Internal Service Fund The Internal Service Fund is used to account for the Town’s self-insurance program for accident and health insurance coverage of Town and Board of Education employees. Pension and Other Employee Benefit Trust Funds The Pension and Other Employee Benefit Trust Funds are used to account for the activities of the Town’s defined benefit plans and the Town and Board of Education for other postemployment benefits (e.g., health insurance, life insurance) which accumulate resources for pension benefit and other postemployment benefit payments to qualified employees. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenue includes all taxes. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the Town’s proprietary funds are charges to the Town and its employees for medical insurance premiums. Operating expenses for the fund include the cost of claims and administrative expenses. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. C. Cash Equivalents For purposes of reporting cash flows, all savings, checking, money market accounts, and certificates of deposit with an original maturity of less than 90 days are considered to be cash equivalents.56 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (34) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Investments Investments are stated at fair value. The Town has private equity partnerships for which there may be no ready market to determine fair value. These investments are valued using the most recent valuation available from the external fund manager. These estimated values do not necessarily represent the amounts that will ultimately be realized upon the disposition of those assets, which may be materially higher or lower than the values determined if a ready market for the securities existed. E. Supplies and Prepaid Items All inventories are valued at cost using the first-in first-out (FIFO) method. Inventories of governmental funds are recorded as expenditures when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government-wide and fund financial statements. The cost of prepaid items is recorded as expenditures/expenses when consumed rather than when purchased. F. Receivables and Payables Due from/to Other Funds Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the noncurrent portion of interfund loans). All other outstanding balances between funds are reported as “due to/from other funds.” Loans Receivable Loans receivable in the Planning and Development Program Fund are related to small cities loans. Loans receivable in the governmental activities are due from participating municipalities for their portion of the waste water treatment plant renovation and expansion capital project. Loans receivable are recorded and revenues recognized as earned. G. Capital Assets Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the government-wide financial statements. Capital assets are defined by the government as assets with an initial individual cost of more than $10,000 for equipment, $20,000 for improvements and $100,000 for infrastructure, and an estimated useful life of more than two years. 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. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend lives are not capitalized.57 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (35) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. Capital Assets (Continued) Major outlays for capital assets and improvements are capitalized as projects are constructed. Property, plant, and equipment of the Town are depreciated using the straight-line method over the following estimated useful lives: Infrastructure: Roads 30 to 50 Years Sewer Lines and Water Lines 50 Years Bridge/Large Culverts 30 to 50 Years Dams 50 Years Land and Buildings: Land - Buildings 50 to 75 Years Construction in Progress - Vehicles and Equipment: Fire Equipment 20 to 25 Years Ambulances 5 Years Construction Equipment 5 Years Machinery and Equipment 3 to 10 Years Vehicles 3 to 15 Years H. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets or fund balance that applies to a future period or periods and so will not be recognized as an outflow of resources (expense/expenditure) until then. The Town reports a deferred charge on refunding and deferred outflows related to pension and OPEB in the government-wide statement of net position. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. Deferred outflows of resources related to pension and OPEB resulted from differences between expected and actual experience, changes in assumptions or other inputs or the net difference between projected and actual earnings on pension and OPEB plan investments. These amounts are deferred and included in pension and OPEB expense in a systematic and rational manner over a period equal to the average of the expected remaining service lives of all employees that are provided with benefits through the pension plan (active employees and inactive employees).58 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (36) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) H. Deferred Outflows/Inflows of Resources (Continued) In addition to liabilities, the statement of net position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets or fund balance that applies to a future period or periods and so will not be recognized as an inflow of resources (revenue) until that time. The Town reports deferred inflows related to pension and OPEB in the government-wide statement of net position. The Town also reports leases in the government-wide statement of net position and in the governmental funds balance sheet. A deferred inflow of resources related to pension and OPEB results from differences between expected and actual experience, changes in assumptions or other inputs. These amounts are deferred and included in pension and OPEB expense in a systematic and rational manner over a period equal to the average of the expected remaining service lives of all employees that are provided with benefits through the pension and OPEB plan (active employees and inactive employees) or in the case of the difference in projected and actual earnings on pension and OPEB plan investments, over a systematic and rational method over a closed five-year period. Also, for governmental funds, the Town reports unavailable revenue, which arises only under the modified accrual basis of accounting. The governmental funds report unavailable revenues from several sources: property taxes, property tax interest, sewer assessment, grants, leases, other districts and loans receivable. These amounts are deferred and recognized as an inflow of resources (revenue) in the period in which the amounts become available. I. Net Pension Liability The net pension liability is measured as the portion of the actuarial present value of projected benefits that is attributed to past periods of employee service (total pension liability), net of the pension plan’s fiduciary net position. The pension plan’s fiduciary net position is determined using the same valuation methods that are used by the pension plan for purposes of preparing its statement of fiduciary net position. The net pension liability is measured as of a date (measurement date) no earlier than the end of the employer’s prior fiscal year, consistently applied from period to period. J. Net Other Postemployment (OPEB) Liability (Asset) The net OPEB liability (asset) is measured as the portion of the present value of projected benet payments to be provided to current active and inactive employees that is attributed to those employees’ past periods of service (total OPEB liability), less the amount of the OPEB plan’s duciary net position. The OPEB plan’s fiduciary net position is determined using the same valuation methods that are used by the OPEB plan for purposes of preparing its statement of fiduciary net position. The net OPEB liability (asset) is measured as of a date (measurement date) no earlier than the end of the employer’s prior fiscal year, consistently applied from period to period.59 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (37) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Long-Term Obligations In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of 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 debt service expenditures. L. Compensated Absences and Termination Benefits The liability for compensated absences reported in the government-wide and proprietary fund statements consists of leave that has not been used that is attributable to services already rendered, accumulated and is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. The liability also includes amounts for leave that has been used for time off but has not yet been paid in cash or settled through noncash means and certain other types of leave. M. Equity Equity in the government-wide financial statements is defined as “net position” and is classified in the following categories: Net Investment in Capital Assets This component of net position consists of capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, notes, or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. Restricted Net Position Restrictions are externally imposed by creditors (such as through debt covenants), grantors, contributors or laws or regulations of other governments or imposed by law through constitutional provisions or enabling legislation. The Town currently has no assets under restriction. Unrestricted Net Position This component consists of net position that does not meet the definition of “restricted” or “net investment in capital assets.”60 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (38) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) M. Equity (Continued) Unrestricted Net Position (Continued) When both restricted and unrestricted resources are available for use, it is the Town’s policy to use restricted resources first, then unrestricted resources as they are needed. The equity of the fund financial statements is defined as “fund balance” and is classified in the following categories: Nonspendable Fund Balance This represents amounts that cannot be spent due to form (e.g., inventories and prepaid amounts). Restricted Fund Balance This represents amounts constrained for a specific purpose by external parties, such as grantors, creditors, contributors, or laws and regulations of their governments. Committed Fund Balance This represents amounts constrained for a specific purpose by a government using its highest level of decision-making authority (Simsbury Board of Finance). The Board of Finance is the highest level of decision-making authority for the government that can, by adoption of an ordinance prior to the end of the fiscal year, commit fund balance. Once adopted, the limitation imposed by the ordinance remains in place until a similar action is taken (the adoption of another ordinance) to remove or reverse the limitation. Assigned Fund Balance This balance represents amounts constrained for the intent to be used for a specific purpose by the finance director or the Board of Finance which have been delegated authority to assign amounts by the Town Charter. Unassigned Fund Balance This represents fund balance in the General Fund in excess of nonspendable, restricted, committed and assigned fund balance. If another governmental fund has a fund balance deficit, it is reported as a negative amount in unassigned fund balance. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the Town considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the Town considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds.61 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (39) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) N. Property Taxes The Town’s property tax is levied each June on the assessed value listed on the prior October 1 Grand List for all taxable property located in the Town. Although taxes are levied in June, the legal right to attach property does not exist until July 1. Real and personal property tax bills in excess of $100 are due and payable in two installments, on July 1 following the date of the Grand List and on January 1 of the subsequent year. Motor vehicle taxes are payable in one installment on July 1. Additional property taxes are assessed for motor vehicles registered subsequent to the Grand List date through July 31 and are payable in one installment due January 1. Taxes not paid within 30 days of the due date are subject to an interest charge of 1.5% per month. The Town files liens against property if taxes that are due July 1 remain unpaid on the following June 30. Property tax revenues are recognized when they become available. Available means due or past due and receivable within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period. The Town defines the current period to mean within 60 days after year-end. Property taxes receivable not expected to be collected during the available period are reflected in deferred revenue in the fund financial statements. The entire receivable is recorded as revenue in the government-wide financial statements. Property taxes collected prior to June 30 that are applicable to the subsequent year’s assessment are reflected as advance tax collections in both the fund financial statements and the government-wide financial statements. O. 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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.62 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (40) NOTE 2 STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. Budgetary Information Budgets for the General Fund, Sewer Use Fund, Residential Rental Properties Fund and Simsbury Farms Fund are authorized annually by the Board of Finance. Annual budgets are not adopted for Special Revenue Funds other than the Sewer Use Fund, Residential Rental Properties Fund and Simsbury Farms Fund. The annual budget making process is outlined in Chapter IV of the Simsbury Town Charter, “The Board of Selectmen” and in Chapter VIII, “Finance and Taxation,” according to the following schedule: By January 31, the head of each department, office, or agency of the Town except the Board of Education files with the Director of Finance a detailed estimate of the expenditures to be made by such department, office, or agency and the revenues, other than tax revenue, to be collected thereby in the ensuing fiscal year. By March 1, the Director of Finance compiles department estimates for the annual budget and under the direction of the First Selectman presents to the Board of Selectmen the completed budget of all boards, offices, and agencies, except the Board of Selectmen. By March 15, the Board of Education presents its budget to the Director of Finance, the Board of Finance, and the Board of Selectmen. By March 31, the Board of Selectmen presents to the Board of Finance a budget for all departments, offices, and agencies of the Town, except the Board of Education, consisting of: (a) a budget message; (b) estimates of revenue; and (c) itemized estimates of expenditures. As part of the budget the First Selectman presents a program approved by the Board of Selectmen of proposed capital projects for the ensuing fiscal year and the five fiscal years thereafter. The Board of Finance holds one or more public hearings the first of which must be held not later than the tenth day of April at which time any Elector or taxpayer has an opportunity to be heard. The Board of Finance, by resolution adopted by an affirmative vote of at least four members after holding the final public hearing, and no more than 10 days after the final public hearing, approve a budget and file the same with the Town Clerk for submission to the Automatic Referendum for its adoption. Should the Board of Finance fail to approve a budget no more than 10 days after such final public hearing, the budget as transmitted by the Board of Selectmen and by the Board of Education is deemed to have been finally approved by the Board of Finance.63 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (41) NOTE 2 STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) A. Budgetary Information (Continued) The annual budget becomes effective only after it has been approved by resolution of the Board of Finance and adopted at an automatic referendum held following the final public hearing by a majority vote at such referendum. The Board of Finance, within five days following the adoption of the budget by referendum, fixes the tax rate in mills which is levied on all taxable property in the Town for the ensuing fiscal year. Should the budget not be approved at referendum, the Board of Finance, in cooperation with the First Selectman, revises the budget for presentation at a subsequent public hearing and referendum. If the Budget remains unaccepted at the second referendum, the adopted budget for the then current fiscal year becomes the temporary budget on a month-to- month basis until a new budget is adopted. Upon request of the Board of Selectmen, during the last six months of the fiscal year, the Board of Finance may, by resolution, transfer any unencumbered appropriation, balance, or portion thereof from one department, commission, board, or office to another, except for the Board of Education. No transfer shall be made from any appropriation for debt service and other statutory charges. For management purposes, the Board of Finance is authorized to transfer the legally budgeted amounts between department accounts. In this function, departmental budget accounts serve as the legal level of control for the General Fund. The legal level of budgetary control is at the fund level for the Sewer Use, Residential Rental Properties and Simsbury Farms funds. All unencumbered appropriations lapse at year-end, except those for capital projects and special revenue funds. Appropriations for these expenditures are continued until completion of applicable projects, which often last more than one fiscal year. Subject to certain restrictions, additional appropriations may be approved by the Board of Finance upon recommendation of the Board of Selectmen. Summarizations of the amended General Fund budgets approved by the Board of Finance for the “budgetary” general and certain special revenue funds are presented in the required supplementary information. During the year there were $2,002,936 of supplemental budgetary appropriations made from General Fund unappropriated and unencumbered surplus. B. Deficit Fund Equity State and Federal Education Grants 29,540$ The state and federal education grants deficit will be funded by future grants.64 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (42) NOTE 2 STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) C. Overexpended Appropriations The Town overexpended the final budget as follows: General Fund: Nonpublic Schools 10,504$ NOTE 3 DETAILED NOTES ON ALL FUNDS A. Cash, Cash Equivalents, and Investments The deposit of public funds is controlled by the Connecticut General Statutes (Section 7-402). Deposits may be made in a “qualified public depository” as defined by Statute or, in amounts not exceeding the Federal Deposit Insurance Corporation insurance limit, in an “out of state bank” as defined by the Statutes, which is not a “qualified public depository.” The Connecticut General Statutes (Section 7-400) permit municipalities to invest in: 1) obligations of the United States and its agencies, 2) highly rated obligations of any state of the United States or of any political subdivision, authority or agency thereof, and 3) shares or other interests in custodial arrangements or pools maintaining constant net asset values and in highly rated no-load open end money market and mutual funds (with constant or fluctuating net asset values) whose portfolios are limited to obligations of the United States and its agencies, and repurchase agreements fully collateralized by such obligations. Other provisions of the Statutes cover specific municipal funds with particular investment authority. The provisions of the Statutes regarding the investment of municipal pension funds do not specify permitted investments. Therefore, investment of such funds is generally controlled by the laws applicable to fiduciaries and the provisions of the applicable plan. The Statutes (Sections 3-24f and 3-27f) also provide for investment in shares of the State Short-Term Investment Fund (STIF) and the State Tax Exempt Proceeds Fund (TEPF). These investment pools are under the control of the State Treasurer, with oversight provided by the Treasurer’s Cash Management Advisory Board, and are regulated under the State Statutes and subject to annual audit by the Auditors of Public Accounts. Investment yields are accounted for on an amortized-cost basis with an investment portfolio that is designed to attain a market-average rate of return throughout budgetary and economic cycles. Investors accrue interest daily based on actual earnings, less expenses, and transfers to the designated surplus reserve, and the fair value of the position in the pool is the same as the value of the pool shares.65 TOWN OF SIMSBURY, CONNECTICUT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 (43) NOTE 3 DETAILED NOTES ON ALL FUNDS (CONTINUED) A. Cash, Cash Equivalents, and Investments (Continued) Deposits Deposit Custodial Credit Risk Custodial credit risk is the risk that, in the event of a bank failure, the Town’s deposit will not be returned. The Town does not have a deposit policy for custodial credit risk. The deposit of public funds is controlled by
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