City Gate Community Development District
FINANCIAL STATEMENTS

September 30, 2020

REPORT

Table of Contents

Page

Independent Auditors' Report ........................................................................................	1
FINANCIAL STATEMENTS
Management’s Discussion and Analysis (required supplemental information).............	3
Basic Financial Statements Government‐Wide Financial Statements
Statement of Net Position .......................................................................................	8
Statement of Activities .............................................................................................	9
Fund Financial Statements
Balance Sheet – Governmental Funds......................................................................	10
Reconciliation of the Balance Sheet of Governmental Funds to the Statement
of Net Position ..........................................................................................................	11
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds ................................................................................................	12
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ............................	13
Notes to Financial Statements ........................................................................................	14
Required Supplemental Information (other than MD&A)
Budget to Actual Comparison Schedule ‐ General Fund .............................................	22
Independent Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance
With Government Auditing Standards............................................................................	23
Management Letter ........................................................................................................	25
Independent Accountants’ Report on Compliance with Section 218.415
Florida Statutes ...............................................................................................................	27

INDEPENDENT AUDITORS' REPORT

To the Board of Supervisors
City Gate Community Development District Collier County, Florida

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities and each major fund of City Gate Community Development District (hereinafter referred to as “District”), as of and for the year ended September 30, 2020, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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.

Auditors' Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements 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 the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the District as of September 30, 2020, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and budgetary comparison information, as listed in the table of contents, be presented to supplement the basic financial statements. Such information, 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 auditing standards generally accepted in the United States of America, 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.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report April 19, 2021, on our consideration of the District's internal control over financial reporting and 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 District’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 the District’s internal control over financial reporting and compliance.

CARR, RIGGS & INGRAM, LLC

Miramar Beach, Florida April 19, 2021

Management’s Discussion And Analysis

Our discussion and analysis of the City Gate Community Development District’s financial performance provides an overview of the District’s financial activities for the fiscal year ended September 30, 2020. Please read it in conjunction with the District’s financial statements, which begin on page 8.

FINANCIAL HIGHLIGHTS

At September 30, 2020, the assets of the District exceeded its liabilities by approximately
$112,000.

During the year ended September 30, 2020, the District reported revenues and expenditures totaling approximately $297,000 and $309,000, respectively.

USING THE ANNUAL REPORT

This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of Activities on pages 8 – 9 provide information about the activities of the District as a whole and present a longer‐term view of the District’s finances. Fund financial statements start on page 10. For governmental activities, these statements tell how these services were financed in the short‐term as well as what remains for future spending. Fund financial statements also report the District’s operations in more detail than the government‐wide statements by providing information about the District’s most significant funds.

Reporting the District as a Whole

Our analysis of the District as a whole begins on page 4. One of the most important questions asked about the District’s finances is, “Is the District as a whole better off or worse off as a result of the year’s activities?” The Statement of Net Position and the Statement of Activities report information about the District as a whole and about its activities in a way that helps answer this question. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private‐sector companies. All of the current year’s revenues and expenses are taken into account regardless of when cash is received or paid.

These two statements report the District’s net position and related changes during the current year. You can think of the District’s net position – the difference between assets and liabilities – as one way to measure the District’s financial health, or financial position. Over time, increases or decreases in the District’s net position is one indicator of whether its financial health is improving or deteriorating. You will need to consider other nonfinancial factors; however, such as changes in the District’s assessment base and the condition of the District’s infrastructure, to assess the overall health of the District.

Reporting the District’s Most Significant Funds

Our analysis of the District’s major funds begins on page 5. The fund financial statements begin on page 10 and provide detailed information about the most significant funds – not the District as a whole. Some funds are required to be established by State law and by bond covenants. All of the District’s funds are governmental fund‐types.

Governmental funds – All of the District’s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year‐ end that are available for spending. The governmental fund statements provide a detailed short‐term view of the District’s general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the District’s programs.

THE DISTRICT AS A WHOLE

The following table reflects the condensed Statement of Net Position and is compared to the prior
year.	
September 30,
Assets
Current and other assets Capital assets, net	2020

$	81,975	$
93,742	2019	Change

61,211	$	20,764
20,395	73,347	

Total assets	
$	175,717	$	
81,606	$	94,111	

Liabilities							
Current liabilities	$	33,354	$	2,865	$	30,489	
Other liabilities		30,000		52,698		(22,698)	
Total liabilities		63,354		55,563		7,791	

Net position							
Net investment in capital assets		33,742		‐		33,742	
Unrestricted		78,621		26,043		52,578	
Total net position		112,363		26,043		52,578	

Total liabilities and net position	
$	
175,717	
$	
81,606	
$	
60,369	

For more detailed information, see the accompanying Statement of Net Position.

During fiscal year ended September 30, 2020, total assets and liabilities increased by approximately
$94,000 and $8,000, respectively. The increase in both is primarily related to an increased level of activity in the District and the excess of revenues over expenses in the current year.

The following schedule compares the Statement of Activities for the current and previous fiscal year.

For the year ended September 30,
Revenues:	2020	2019	Change	
Program revenues:
Charges for services Total revenues	
$	297,301	$
297,301	
140,000	$
140,000	
157,301
157,301	

Expenses:
General government	35,533	125,991	(90,458)	
Maintenance and operations	148,448	‐	148,448	
Developer refund	27,000	‐	27,000	

Total expenses	
210,981	
125,991	
84,990	

Change in net position	
86,320	
14,009	
72,311	
Net position, beginning of year	26,043	12,034	14,009	

Net position, ending of year	
$	112,363	
$	26,043	
$	86,320	

For more detailed information, see the accompanying Statement of Activities.

Revenues increased over the prior year by approximately $157,000 and expenses increased over the prior year by approximately $85,000. Revenues increased due to an increase in budgeted assessments. The increase in expenses occurred primarily due to budgeted maintenance projects in the current year. The overall result was an $86,320 increase in net position for fiscal year 2020.

THE DISTRICT’S FUNDS

As the District completed the year, its governmental funds (as presented in the balance sheet on page 10) reported a combined fund balance of approximately $79,000 which is an increase over last year’s balance that totaled $58,000. The only significant activity in 2020 was the infrastructure project that began in the prior year, collection of assessments and payment of certain administrative expenditures to maintain minimum operations.

During the fiscal year ended September 30, 2020, the District incurred capital outlay expenditures of approximately $76,000, which was partially funded by a developer advance refunding totaling approximately $32,000.

CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets

At September 30, 2020, the District had approximately $96,000 invested in capital assets. This amount represents an increase of approximately $76,000 over the fiscal year 2019 total.

A listing of capital assets by major category for the current and prior year follows:

September 30,	2020	2019	Change	

Capital assets not being depreciated Capital assets being depreciated	
$		‐	$	20,395 96,146			‐	
$	
(20,395)
96,146	

Total, prior to depreciation Accumulated depreciation	
96,146
2,404	
20,395
‐		
75,751
2,404	

Net capital assets	
$	93,742	$	20,395	
$	
73,347	

More information about the District’s capital assets is presented in Note 3 to the financial statements.

Debt

At September 30, 2020, the District had approximately $60,000 of debt outstanding. A listing of debt amounts outstanding for the current and prior year is as follows:
September 30,	2020	2019	Change

Notes payable	$	60,000	$	52,698	$	7,302

More information about the District’s long‐term debt is presented in Note 4 to the financial statements.

GOVERNMENTAL FUNDS BUDGETARY HIGHLIGHTS

An Operating budget was established by the governing board for the District pursuant to the requirements of Florida Statutes. The budget to actual comparison for the General Fund, including the original budget and final adopted budget, is shown at page 22.

The District experienced a favorable excess of $85,023, as compared to the budget. The variance in expenditures occurred primarily due to less maintenance and operations expenses incurred than anticipated.

FUTURE FINANCIAL FACTORS

City Gate Community Development District is an independent special district that operates under the provisions of Chapter 190, Florida Statutes. The District operates under an elected Board of Supervisors, which establishes policy and sets assessment rates. Assessments are anticipated for fiscal year 2021 to provide for the operations of the District.

CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide a general overview of the District’s finances. If you have questions about this report or need additional financial information, contact the City Gate Community Development District’s management company at 12051 Corporate Blvd, Orlando, Florida 32817.

Basic Financial Statements

City Gate Community Development District
Statement of Net Position	
September 30,

Assets
Cash and cash equivalents Deposits
Prepaid expenses Capital assets:
Depreciable, net	2020
Governmental Activities

$	76,674
50
5,251

93,742	

Total assets	
175,717	

Liabilities		
Accounts payable	3,354	
Non‐current liabilities:		
Due within one year	30,000	
Due in more than one year	30,000	

Total liabilities	
63,354	

Net Position
Invested in capital assets, net of related debt Unrestricted		
33,742
78,621	

Total net position	
$	
112,363	

The accompanying notes are an integral part of these financial statements.

City Gate Community Development District
Statement of Activities	
For the year ended September 30,		2020

Program Revenues		
			Net (Expense)
Revenue and Changes in Net Position	

Functions/Programs Primary government:
Governmental activities: General government Maintenance and operations
Developer refund			Operating	Capital		
		Charges for	Grants and	Grants and	Governmental	
	Expenses	Services	Contributions	Contributions	Activities	
	
$	(35,533)	
$	58,179	
$	‐	
$	‐	
$	22,646	
	(148,448)	239,122	‐	‐	90,674	
	(27,000)	‐	‐		(27,000)	

Total governmental activities	
$	(210,981)	
$	297,301	
$	
‐	
$	‐	
86,320	
	
Net position ‐ beginning of year				
26,043	
	
Net position ‐ end of year			
$	
112,363	

The accompanying notes are an integral part of these financial statements.
‐ 9 ‐

City Gate Community Development District
Balance Sheet – Governmental Funds	
September 30,	2020

Total Governmental
General Fund	Capital Projects	Funds

Assets
Cash and cash equivalents	$	76,674	$	‐	$	76,674 Deposits			50		‐			50
Prepaid expenditures	5,251	‐	5,251

Total assets	$	81,975	$	‐	$	81,975	

Liabilities and Fund Balance
Liabilities
Accounts payable	$	3,354	$	‐	$	3,354	
Total liabilities	3,354		‐	3,354	

Fund balances Unassigned		

78,621		

‐		

78,621	
Total fund balances		78,621		‐		78,621	

Total liabilities and fund balances	
$	
81,975	
$	
‐	
$	
81,975	

Reconciliation of the Balance Sheet of Governmental Funds to the Statement of
Net Position

September 30,		2020	

Total fund balances, governmental funds	
$	
78,621	
Capital assets used in governmental activities are not financial resources and	
therefore are not reported in the fund financial statements.		93,742	
Liabilities not due and payable from current resources, including accrued interest,	
are not reported in the fund level statements.		(60,000)	

Total net position ‐ governmental activities	
$	
112,363	

Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds
For the year ended September 30,	2020
			Total	
			Governmental	
	General Fund	Capital Projects	Funds	
Revenues				
Assessments	$	297,301	$	‐	$	297,301	
Total revenues	297,301	‐	297,301	

Expenditures
Current:

General government	35,533		654	36,187	
Maintenance and operations	145,390		‐	145,390	
Debt service	‐		25,000	25,000	
Capital outlay	2,355		73,396	75,751	
Developer refund	27,000		‐	27,000	
Total expenditures	210,278		99,050	309,328	

Excess (deficit) of revenues over expenditures	
87,023		
(99,050)	
(12,027)	

Other Financing Sources (Uses)
Transfers in	

‐		

66,748	

66,748	
Transfers out	(66,748)		‐	(66,748)	
Developer advance refunding	‐		32,302	32,302	
Total other financing sources (uses)	(66,748)		99,050	32,302	

Net change in fund balances	
20,275		
‐	
20,275	
Fund balances, beginning of year	58,346		‐	58,346	

Fund balances, end of year	
$	78,621	
$	
‐	
$	78,621	

Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities

For the year ended September 30,	2020

Net change in fund balances ‐ governmental funds	$	20,275
Capital outlay, reported as expenditures in the governmental funds, is shown as
capital assets on the Statement of Net Assets.	75,751	

Proceeds on notes payable which are reported as other financing sources in the
governmental funds, but impact liability balances in the Statement of Net Position.	(32,302)

Governmental funds report principal payments on bonds when debt is paid, whereas these payments are eliminated in the Statement of Activities and
recognized as a decrease in bonds payable in the Statement of Net Assets.	25,000
Change in net position of governmental activities	$	86,320	

NOTE 1: NATURE OF ORGANIZATION

The City Gate Community Development District (the “District”) was established on December 1, 2009 pursuant to the Uniform Community Development District Act of 1980, otherwise known as Chapter 190, Florida Statutes, by Collier County Ordinance No. 09‐68. The Act provides, among other things, the power to manage basic services for community development, power to borrow money and issue bonds, and to levy and assess non‐ad valorem assessments for the financing and delivery of capital infrastructure.

The District was established for the purposes of financing and managing the acquisition, construction, maintenance, and operation of a portion of the infrastructure necessary for community development within the District. The District has not commenced any significant infrastructure activity as of the date of this report.

The District is governed by a Board of Supervisors (“Board”), which is comprised of five members. The Supervisors are elected on an at large basis by the owners of the property within the District. Certain supervisors are affiliated with 850 NWN, LLC (the "Developer"). The Board of Supervisors of the District exercise all powers granted to the District pursuant to Chapter 190, Florida Statutes.

The Board has the final responsibility for:
Assessing and levying assessments.
Approving budgets.
Exercising control over facilities and properties.
Controlling the use of funds generated by the District.
Approving the hiring and firing of key personnel.
Financing improvements.

In evaluating how to define the government, for financial reporting purposes, management has considered all potential component units. The decision to include or exclude a potential component unit in the reporting entity was made by applying the criteria set forth by Generally Accepted Accounting Principles (GAAP) as defined by the Governmental Accounting Standards Board (GASB). Based on the criteria identified therein, no potential component units were found.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting policies of the District conform to GAAP as applicable to governments in accordance with those promulgated by GASB. The following is a summary of the more significant policies:

Government‐wide and Fund Financial Statements

The basic financial statements include both 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 the non‐fiduciary activities of the primary government.

Governmental activities, which normally are supported by assessments, are reported separately from business‐type activities, which rely to a significant extent on fees and charges for support. The business‐type activities are reported separately in government‐wide financial statements; however, at September 30, 2020, the District did not have any significant business‐type activities. Therefore, no business‐type activities are reported. Assessments and other items not properly included as program revenues (i.e., charges to customers or applicants who purchase, use, or directly benefit from goods or services) are reported as general revenues.

Separate financial statements are provided for governmental funds. Major individual governmental funds are reported as separate columns in the fund financial statements.

Measurement Focus, Basis of Accounting and Basis of Presentation

The government‐wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of the related cash flows. Assessments are recognized as revenues in the year for which they are levied. Grants and other similar items are to be 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 District considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures are recorded only when payment is due.

Assessments 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. All other revenue items are considered to be measurable and available only when cash is received by the District.

The District reports the following major governmental funds:

General Fund – The General Fund is the primary operating fund of the District. It is used to account for all financial resources except those required to be accounted for in other funds.

Capital Projects Fund – The Capital Projects Fund is used to account for the financial resources to be used in the acquisition of construction of major infrastructure within the District.

For the year ended September 30, 2020, the District does not report any proprietary funds.

As a general rule, the effect of interfund activity has been eliminated from the government‐wide financial statements.

When both restricted and unrestricted resources are available for use, it is the District’s policy to use restricted resources first, then unrestricted resources as they are needed. When committed, assigned, or unassigned resources are available for use in the governmental fund financial statements, it is the government’s policy to use committed resources first, followed by assigned resources, then unassigned resources as needed.

Cash, Deposits and Investments

The District maintains deposits with "Qualified Public Depositories" as defined in Chapter 280, Florida Statutes. All Qualified Public Depositories must place with the Treasurer of the State of Florida securities in accordance with collateral requirements determined by the State’s Chief Financial Officer. In the event of default by a Qualified Public Depository, the State Treasurer will pay public depositors all losses. Losses in excess of insurance and collateral will be paid through assessments between all Qualified Public Depositories.

Under this method, all the District's deposits are fully insured or collateralized at the highest level of security as defined by GASB, Statement Number 40, Deposits and Investment Disclosures (An Amendment of GASB, Statement Number 3).

The District is authorized to invest in financial instruments as established by Section 218.415, Florida Statutes. The authorized investments include among others negotiable direct or indirect obligations which are secured by the United States Government; the Local Government Surplus Trust Funds as created by Section 218.405, Florida Statutes; SEC registered money market funds with the highest credit quality rating from a nationally recognized rating agency; and interest‐bearing time deposits or savings accounts in authorized financial institutions.

Capital Assets

Capital assets, which include primarily infrastructure assets (e.g., roads, sidewalks, water management systems and similar items), are reported in the governmental activities column in the government‐wide financial statements. Capital assets are defined by the District as assets with an initial/individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are recorded at historical cost and estimated historical cost if purchased or constructed. Donated assets are recorded at estimated fair market 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 asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed.

Property, plant and equipment of the primary government are depreciated using the straight‐line method over the estimated useful lives. Estimated useful lives for financial reporting purposes are as follows: Infrastructure: 25 years.

In the governmental fund financial statements, amounts incurred for the acquisition of capital assets are reported as fund expenditures. Depreciation expense is not reported in the governmental fund financial statements.

Long‐Term Obligations

In the government‐wide financial statements, long‐term debt and other long‐term obligations are reported as liabilities in the Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight‐line or effective interest method. Bonds payable are reported net of these premiums or discounts. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as current period expenses.

In the fund financial statements, governmental fund types recognize bond premiums and discounts during the current period. The face amount of the 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.

Deferred Outflows/Inflows of Resources

In addition to assets, the Statement of Net Position and Balance Sheet – Governmental Funds will sometimes include a separate section for deferred outflows of resources.

This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District does not have any of this type of item at September 30, 2020.

In addition to liabilities, the Statement of Net Position and Balance Sheet – Governmental Funds 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 position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The District does not have any of this type of item at September 30, 2020.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

Fund Equity

Net position in the government‐wide financial statements is categorized as net investment in capital assets, restricted or unrestricted. Net investment in capital assets represents net position related to infrastructure and property, plant and equipment, net of any related debt. Restricted net position represents net position restricted by outside entities. At September 30, 2020, all of the District’s net position is classified as unrestricted.

Governmental fund equity is classified as fund balance. Fund balance is further classified as nonspendable, restricted, committed, assigned, or unassigned. Nonspendable fund balance cannot be spent because of its form. Restricted fund balance has limitations imposed by creditors, grantors, or contributors or by enabling legislation or constitutional provisions. Committed fund balance is a limitation imposed by the District board through approval of resolutions. Assigned fund balance is a limitation imposed by a designee of the District board. Unassigned fund balance in the General Fund is the net resources in excess of what can be properly classified in one of the above four categories. Negative unassigned fund balance in other governmental funds represents excess expenditures incurred over the amounts restricted, committed, or assigned to those purposes.

Budgets

The District is required to establish a budgetary system and an approved annual budget. Annual budgets are legally adopted on a basis consistent with GAAP for the General Fund. Any revision to the budget must be approved by the District Board. The budgets are compared to actual expenditures. In instances where budget appropriations and estimated revenues have been revised during the year, budget data presented in the financial statements represent final authorization amounts.

During the year‐end September 30, 2020, general fund expenditures exceeded budgeted amounts largely as a result of unbudgeted capital outlay expenditures.

The District follows these procedures in establishing the budgetary data reflected in the financial statements:

Each year the District Manager submits to the District Board a proposed operating budget for the fiscal year commencing the following October 1.
A public hearing is conducted to obtain comments.
Prior to October 1, the budget is legally adopted by the District Board.
All budget changes must be approved by the District Board.
Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America.

Subsequent Events

Management has evaluated subsequent events through the date that the financial statements were available to be issued, April 19, 2021. See Note 9 for relevant disclosure. No subsequent events occurring after this date have been evaluated for inclusion in these consolidated financial statements.

NOTE 3: CAPITAL ASSETS

The following is a summary of changes in the capital assets of the year ended September 30, 2020:

Beginning					Ending	
	Balance	Additions	Subtractions	Balance	
Governmental Activities:									
Capital assets being depreciated									
Infrastructure	$	20,395	$	75,752	$	‐	$	96,147	
Total capital assets, being depreciated		20,395		75,752		‐		96,147	

Less accumulated depreciation
Infrastructure
Total accumulated depreciation		

‐
‐		

2,404
2,404		

‐
‐		

2,404
2,404	

Total capital assets, being depreciated, net		
20,395		
73,348		
‐		
93,743	

Governmental activities capital assets, net	
$	
20,395	
$	
73,348	
$	
‐	
$	
93,743	

NOTE 4: NOTES PAYABLE

In June 2019, the Developer agreed to lend funds for the construction and installation of two entry monuments signs for the District. The Developer is disbursing the note payable in three installments. The final installment was disbursed prior to September 30, 2020. In connection with the note payable, the District agreed to repay the Developer over the next three fiscal years in installment payments bearing interest at Prime + 1%.

Notes payable activity for the year ended September 30, 2020, was as follows:

Governmental Activities
Notes Payable	Beginning Balance

$	52,698	
Additions

$	32,302	
Reductions

$	(25,000) $	Ending Balance

60,000	Due Within One Year

$	30,000	
	
$	52,698	
$	32,302	
$	(25,000) $	
60,000	
$	30,000	

At September 30, 2020, the scheduled debt service requirements on notes payable were as follows:

For the year ending September 30,	Principal	Interest	Total

2021	$	60,000	$	2,550	$	62,550	

$	60,000	
$	2,550	
$	62,550	

NOTE 5: RISK MANAGEMENT

The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters. The District maintains commercial insurance coverage to mitigate the risk of loss. Coverage may not extend to all situations. Management believes such coverage is sufficient to preclude any significant uninsured losses to the District. Settled claims have not exceeded this commercial coverage in the previous three years.

NOTE 6: MANAGEMENT COMPANY

The District has contracted with a management company to perform management advisory services, which include financial and accounting advisory services. Certain employees of the management company also serve as officers (Board appointed non‐voting positions) of the District. Under the agreement, the District compensates the management company for management, accounting, financial reporting, and other administrative costs.

NOTE 7: RELATED PARTY TRANSACTIONS

A significant portion of the District’s activity is dependent upon the continued involvement of the Developer, 850 NWN, LLC, the loss of which could have a material adverse effect on the District’s operations.

During the year ended September 30, 2020, the District directly assessed the Developer $297,301 for operations and maintenance on property owned within the District’s boundaries. In addition, as discussed further in Note 4, the Developer agreed to fund the construction and installation of certain infrastructure. In connection with the agreement the Developer remitted approximately $53,000 in notes payable.

NOTE 8: UNCERTAINTY

In March 2020, the World Health Organization made the assessment that the outbreak of a novel coronavirus (COVID‐19) can be characterized as a pandemic. As a result, uncertainties have arisen that may have a significant negative impact on the operating activities and results of the District. The occurrence and extent of such an impact will depend on future developments, including (i) the duration and spread of the virus, (ii) government quarantine measures, (iii) voluntary and precautionary restrictions on travel or meetings, (iv) the effects on the financial markets, and (v) the effects on the economy overall, all of which are uncertain.

NOTE 9: SUBSEQUENT EVENT

Subsequent to year‐end, certain tracts of land within the District were acquired by a third‐party entity with the intention of constructing a new regional distribution facility. As part of this construction project, the purchaser will be expanding certain lake properties within the District and will be contributing these lake expansion properties (approximately 6 acres) to the District after the project is completed. The District anticipates this transfer to take place in late September 2021.

Required Supplemental Information (Other Than MD&A)

For the year ended September 30,		2020			
	Original and		Variance with	
	Final Budget	Actual Amounts	Final Budget	
Revenues					
Assessments	$	297,300	$	297,301	$	1	
Total revenues	297,300	297,301		1	

Expenditures					
General government	35,300	35,533		(233)	
Maintenance and operations	235,000	145,390		89,610	
Capital outlay	25,000	2,355		22,645	
Developer refund	-	27,000		(27,000)	
Total expenditures	295,300	210,278		85,022	

Excess of revenues over expenditures	
$	2,000	
$	87,023	
$	85,023	

INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

To the Board of Supervisors
City Gate Community Development District Collier County, Florida

We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities and each major fund of City Gate Community Development District (hereinafter referred to as the “District”), as of and for the year ended September 30, 2020, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements, and have issued our report thereon dated April 19, 2021.

Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered the District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances 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 District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

CARR, RIGGS & INGRAM, LLC

Miramar Beach, Florida April 19, 2021

MANAGEMENT LETTER

To the Board of Supervisors
City Gate Community Development District Collier County, Florida

Report on the Financial Statements

We have audited the financial statements of City Gate Community Development District (“District”) as of and for the fiscal year ended September 30, 2020, and have issued our report thereon dated April 19, 2021.

Auditors' Responsibility

We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Auditor General.

Other Reports and Schedule

We have issued our Independent Auditors’ Report on Internal Control over Financial Reporting and Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; and Independent Accountants’ Report on an examination conducted in accordance with AICPA Professional Standards, AT‐C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated April 19, 2021 should be considered in conjunction with this management letter.

Prior Audit Findings

Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations made in the preceding annual audit report.

Official Title and Legal Authority

Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. The information required is disclosed in the notes to the financial statements.

Financial Condition and Management

Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to communicate whether or not the District has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and identification of the specific condition(s) met. In connection with our audit, we determined that the District did not meet any of the conditions described in Section 218.503(1), Florida Statutes.

Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for the District. It is management’s responsibility to monitor the District’s financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same.

Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations.

Additional Matters

Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings.

Purpose of this Letter

Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, the Board of Supervisors, and applicable management, and is not intended to be and should not be used by anyone other than these specified parties.

CARR, RIGGS & INGRAM, LLC

Miramar Beach, Florida April 19, 2021

INDEPENDENT ACCOUNTANTS’ REPORT

To the Board of Supervisors
City Gate Community Development District Collier County, Florida

We have examined City Gate Community Development District’s compliance with the requirements of Section 218.415, Florida Statutes, Local Government Investment Policies, during the year ended September 30, 2020. Management of the District is responsible for the District’s compliance with the specified requirements. Our responsibility is to express an opinion on the District’s compliance with the specified requirements based on our examination.

Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether the District complied, in all material respects, with the specified requirements referenced above. An examination involves performing procedures to obtain evidence about whether the District complied with the specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion.

Our examination does not provide a legal determination on the District’s compliance with specified requirements.

In our opinion, the District complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2020.

This report is intended solely for the information and use of management and the State of Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties.

CARR, RIGGS & INGRAM, LLC

Miramar Beach, Florida April 19, 2021