Six Mile Creek Community Development District

ANNUAL FINANCIAL REPORT

September 30, 2019

Six Mile Creek Community Development District ANNUAL FINANCIAL REPORT
September 30, 2019 TABLE OF CONTENTS
Page Number

REPORT OF INDEPENDENT AUDITORS	1-2
MANAGEMENT’S DISCUSSION AND ANALYSIS	3-8
BASIC FINANCIAL STATEMENTS:
Government-wide Financial Statements:
Statement of Net Position	9
Statement of Activities	10
Fund Financial Statements:
Balance Sheet – Governmental Funds	11
Reconciliation of Total Governmental Fund Balances
to Net Position of Governmental Activities	12
Statement of Revenues, Expenditures and Changes in Fund
Balances – Governmental Funds	13
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds
to the Statement of Activities	14
Statement of Revenues, Expenditures and Changes in Fund
Balances – Budget and Actual – General Fund	15
Notes to Financial Statements	16-33
INDEPENDENT AUDITOR'S 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	34-35
MANAGEMENT LETTER	36-38
INDEPENDENT ACCOUNTANT’S REPORT/COMPLIANCE WITH
SECTION 218.415, FLORIDA STATUTES	39

REPORT OF INDEPENDENT AUDITORS

To the Board of Supervisors
Six Mile Creek Community Development District St. Johns County, Florida

Report on the Financial Statements

We have audited the accompanying financial statements of Six Mile Creek Community Development District as of and for the year ended September 30, 2019, and the related notes to 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.

Auditor’s Responsibility

Our responsibility is to express an opinion 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 Accounting 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 auditor’s 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 opinion.

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To the Board of Supervisors
Six Mile Creek Community Development District

Opinion

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 Six Mile Creek Community Development District, as of September 30, 2019, and the respective changes in financial position and the budgetary comparison for the General Fund for the year then ended in conformity 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 Discussion and Analysis 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 a report dated June  29, 2020 on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations and contracts. The purpose  of that report is 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 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 Six Mile Creek Community

Development District’s internal co

ntrol over financial reporting and compliance.

Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL
Fort Pierce, Florida June 29, 2020

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Management’s discussion and analysis of Six Mile Creek Community Development  District’s  (the “District”) financial performance provides an objective and easily readable analysis of the District’s financial activities. The analysis provides summary financial information for the District and should be read in conjunction with the District’s financial statements.

OVERVIEW OF THE FINANCIAL STATEMENTS

The District’s basic financial statements comprise three components; 1) government-wide financial statements, 2) fund financial statements, and 3) notes to financial statements. The government-wide financial statements present an overall picture of the District’s financial position and results of operations. The fund financial statements present financial information for the District’s major funds. The notes to financial statements provide additional information concerning the District’s finances.

The government-wide financial statements are the statement of net position and the statement of activities. These statements use accounting methods similar to those used by private-sector companies. Emphasis is placed on the net position of governmental activities and the change in net position. Governmental activities are primarily supported by special assessments.

The statement of net position presents information on all assets and liabilities of the District, with the difference between assets and liabilities reported as net position. Assets, liabilities, and net position are reported for all Governmental activities.

The statement of activities presents information on all revenues and expenses of  the District  and the change in net position. Expenses are reported by major function and program revenues relating to those functions are reported, providing the net cost of all functions provided by the District. To assist in understanding the District’s operations, expenses have been reported as  governmental activities. Governmental activities financed by the District include general government, physical environment, culture and recreation, and debt service.

Fund financial statements present financial information for governmental funds. These statements provide financial information for the major funds of the District. Governmental fund financial statements provide information on the current assets and liabilities of the funds, changes in current financial resources (revenues and expenditures), and current available resources.

OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED)

Fund financial  statements  include a balance  sheet  and a statement  of revenues, expenditures and changes in fund balances for all governmental funds. A statement of revenues, expenditures, and changes in fund balances – budget and actual is provided for  the District’s General Fund. Fund financial statements provide more detailed information about the District’s activities. Individual funds are established by the District to track revenues that are restricted to certain uses or to comply with legal requirements.

The government-wide financial statements and the fund financial statements provide different pictures of the District. The government-wide financial statements provide an overall picture of the District’s financial standing. These statements are comparable to private-sector companies and give a good understanding of the District’s overall financial health and how the District paid for the various activities, or functions, provided by the District. All assets of the District, including construction in progress, are reported in the statement of net position. All liabilities, including principal outstanding on bonds are included. In the statement of activities, transactions between the different functions of the District have been eliminated in order to avoid “doubling up” the revenues and expenses. The fund  financial  statements  provide  a picture of the major funds of the District. In the case of governmental activities, outlays for long lived assets are reported as expenditures and long-term liabilities, such as general obligation bonds, are not included in the fund financial statements. To provide a link from the fund financial statements to the government-wide financial statements, reconciliation is provided from the fund financial statements to the government-wide financial statements.

Notes to financial statements provide additional detail concerning the financial activities and financial balances of the District. Additional information about the accounting practices of the District, investments of the District, capital assets and long-term debt are some of the items included in the notes to financial statements.

Financial Highlights

The following are the highlights of financial activity for the year ended September 30, 2019.

 The District’s total liabilities exceeded total assets and deferred outflows of resources by
$(21,719,431) (net position). Net investment in capital assets was $(565,210), restricted net position was $1,225,937 and unrestricted net position was $(22,380,158).

 Governmental activities revenues totaled $6,605,115 while governmental activities expenses totaled $2,739,522.

OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED)

Financial Analysis of the District

The following schedule provides a summary of the assets, liabilities and net position of the District and is presented by category for comparison purposes.

Net Position

Governmental Activities
	2019		2018	

Current assets	
$	638,560		
$	232,334	
Restricted assets	3,647,360		5,748,281	
Capital assets, net	 	24,740,995		 	23,290,425	
Total Assets	 	29,026,915		29,271,040	

Deferred outflows of resources	
 	30,128		
 	33,116	
Current liabilities	10,741,892		14,464,198	
Non-current liabilities	 	40,034,582		40,424,982	
Total Liabilities	 	50,776,474		 	54,889,180	
Net Position
Net investment in capital assets	
(565,210)		
46,398	
Restricted net position	1,225,937		-	
Unrestricted net position	 	(22,380,158)		 	(25,631,422)	
Total Net Position	  $ (21,719,431)		  $ (25,585,024)	

The increase in current assets is the result of the increase in assessments receivable and due from developer.

The decrease in restricted assets is primarily due to current year bond principal prepayments.

The increase in capital assets is related to capital asset  additions  in  excess  of depreciation  in  the current year.

The decrease in current liabilities is related to the bond prepayments in the current year.

The increase in restricted net position is related to a developer capital contribution in the current year.

OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED)

Financial Analysis of the District (Continued)

The following schedule provides a summary of the changes in net position of the District and is presented by category for comparison purposes.

Change In Net Position
Governmental Activities

 	2019		 	2018	
Program Revenues

Charges for services	$	4,491,005	$	2,918,810	
Operating grants and contributions	334,310	412,268	
Capital grants and contributions	1,549,150	114,892	
Investment earnings	19,130	21,264	
Miscellaneous revenues	211,520	 	127,262	
Total Revenues	6,605,115	 	3,594,496	
Expenses			
General government	124,859	119,578	
Physical environment	777,007	354,078	
Culture/recreation	460,440	286,078	
Interest and other charges	 	1,377,216	 	1,864,112	
Total Expenses	 	2,739,522	 	2,623,846	
Conveyance to other entities	-	24,814,483	
Change in Net Position	3,865,593	(23,843,833)	
Net Position - Beginning of Year	(25,585,024)	 	(1,741,191)	
Net Position - End of Year	$ (21,719,431)	$ (25,585,024)	

General Revenues

The increase in charges for services is due to the increase in assessments.

The increase in physical environment and culture/recreation is related to the  increase  in depreciation in the current year.

The decrease in interest and other charges is related to the prepayments made in the current year.

The decrease in conveyances is due to the completion of the 2007 Project in the prior year.

OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED)

Capital Assets Activity

The following schedule provides a summary of the District’s capital assets as of September 30, 2019 and 2018.

Governmental Activities
	2019		2018	

Land and improvements	
$	8,230,000		
$	8,230,000	
Construction in progress	3,362,721		1,320,256	
Infrastructure	3,437,651		3,437,651	
Improvements other than buildings	10,192,800		10,192,800	
Equipment	123,000		123,000	
Accumulated depreciation	 	(605,177)		 	(13,282)	
Capital Assets, net	  $ 24,740,995		  $ 23,290,425	

Current year activity consisted of additions to construction in progress of $2,042,465, and depreciation was $591,895.

General Fund Budgetary Highlights

Budgeted expenditures exceeded actual expenditures primarily due to less landscape and pool maintenance expenditures incurred than anticipated in the current year.

There were no amendments to the September 30, 2019 budget.

Debt Management

Governmental Activities debt includes the following:

 In July 2007, the District issued $47,820,000 Series 2007 Capital Improvement Revenue Bonds. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Due to non-payment of assessment by the Developer and its predecessor, scheduled debt service payments have not been  made since fiscal year 2011. Matured bonds payable totaled $2,160,000 at September  30, 2019. The unmatured balance outstanding at September 30, 2019, was $16,020,000.

OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED)

Debt Management (Continued)

 In April 2015, the District issued $3,165,000 Series 2015 (Assessment Area 1) Capital Improvement Revenue Refunding Bonds. The bonds were issued to refund the outstanding Series 2014A Bonds. As of September 30, 2019, the balance outstanding was $2,600,000.

 In April 2016, the District issued $7,315,000 Series 2016A (Assessment Area 2) Capital Improvement Revenue Bonds. These bonds were issued to finance a portion of the cost of acquisition and construction of the 2016 Project. As of September 30, 2019 , the balance outstanding was $6,240,000.

 In April 2016, the District issued $6,720,000 Series 2016B (Assessment Area 2) Capital Improvement Revenue Bonds. These bonds were issued to finance a portion of the cost of acquisition and construction of the 2016 Project. As of September 30, 2019, the balance outstanding was $3,390,000.

 In December 2017, the District issued $10,620,000 Series 2017A (Assessment Area 2, Phase 2) Capital Improvement Revenue Bonds. These bonds were issued to finance a portion of the costs of the 2017 Project. As of September 30, 2019, the balance outstanding was $10,620,000.

 In December 2017, the District issued $3,980,000 Series 2017B (Assessment Area 2, Phase 2) Capital Improvement Revenue Bonds. These bonds were issued to refund a portion of the Series 2016B Capital Improvement Revenue Bonds and pay a portion of the costs of the 2017 Project. As of September 30, 2019, the balance outstanding was
$1,615,000.

Economic Factors and Next Year’s

The District does not expect any economic factors to have a significant effect on the financial position or results of operations of the District in fiscal year 2020.

Request for Information

The financial report is designed to provide a general overview of Six Mile Creek Community Development District’s finances for all those with an interest. Questions concerning any of the information provided in this report or requests for additional information should be addressed to  the Six Mile Creek Community Development District, Governmental  Management  Services,  219 East Livingston Street, Orlando, Florida 32801.

STATEMENT OF NET POSITION
September 30, 2019

	Governmental
Activities	
ASSETS		
Current Assets		
Cash	$	1,990	
Assessments receivable	352,057	
Due from other governments	9,800	
Due from developer	248,437	
Prepaid expenses	 	26,276	
Total Current Assets	 	638,560	
Non-Current Assets Restricted Assets
Investments	3,647,360
Capital Assets, Not Being Depreciated
Land and improvements	8,230,000
Construction in progress	3,362,721
Capital Assets, Being Depreciated
Infrastructure	3,437,651	
Improvements other than buildings	10,192,800	
Equipment	123,000	
Less: accumulated depreciation	 	(605,177)	
Total Non-Current Assets	 	28,388,355	
Total Assets	 	29,026,915	

DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refunding	 	30,128

LIABILITIES
Current Liabilities
Accounts payable	77,652	
Contracts and retainage payable	173,567	
Matured bonds payable	2,160,000	
Matured interest payable	6,600,206	
Bonds payable, current	305,000	
Lease payable, current	13,067	
Accrued interest	 	1,412,400	
Total Current Liabilities	 	10,741,892	
Non-Current Liabilities
Bonds payable, net	
40,033,442	
Lease payable, net	 	1,140	
Total Non-Current Liabilities	 	40,034,582	
Total Liabilities	 	50,776,474	
NET POSITION
Net investment in capital assets	
(565,210)	
Restricted for capital projects	1,225,937	
Unrestricted	 	(22,380,158)	
Total Net Position	  $	(21,719,431)	

See accompanying notes to financial statements.

STATEMENT OF ACTIVITIES
For the Year Ended September 30, 2019

Program Revenues

Net (Expense) Revenues and Changes in Net Position

Charges for

Operating Grants and

Capital Grants and

Governmental

Functions/Programs	 	Expenses	Services	Contributions	Contributions
Governmental Activities

Activities

General government	$	(124,859)	$	72,217	$	51,951	$	-	$	(691)	
Physical environment	(777,007)	224,538	161,527	1,549,150	1,158,208	
Culture/recreation	(460,440)	167,970	120,832	-	(171,638)	
Interest  and other charges	 	(1,377,216)	4,026,280	-	-	 	2,649,064

Total Governmental Activities

  $   (2,739,522)   $	4,491,005	$	334,310	$	1,549,150

3,634,943

General Revenues
Investment earnings	19,130	
Miscellaneous revenues	 	211,520	
Total General Revenues	 	230,650	
Change in Net Position	3,865,593	
Net Position - October 1, 2018	 	(25,585,024)	
Net Position - September 30, 2019	  $ (21,719,431)	

See accompanying notes to financial statements.

Six Mile Creek Community Development District BALANCE SHEET -
GOVERNMENTAL FUNDS
September 30, 2019

	

General		

Debt Service		

Capital Projects		Total Governmental
Funds	
ASSETS								
Cash	$	1,990		$	-		$	-		$	1,990	
Assessments receivable	-		352,057		-		352,057	
Due from other funds	-		3,144		4,153		7,297	
Due from other governments	3,151		6,649		-		9,800	
Due from developer	74,870		-		173,567		248,437	
Prepaid expenses	26,276		-		-		26,276	
Restricted assets								
Cash and investments, at fair value	-		2,415,737		1,231,623		3,647,360	
Total Assets	   $	106,287		   $ 2,777,587		   $	1,409,343		   $	4,293,217	

LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES LIABILITIES
Accounts payable	$	77,652	$	-	$	-	$	77,652	
Due to other funds	7,297	-	-	7,297	
Contracts and retainage payable	-	-	173,567	173,567	
Matured bonds payable	-		2,160,000	-		2,160,000	
Matured interest payable	-		6,600,206	-		6,600,206	
Total Liabilities	84,949		
8,760,206	173,567		9,018,722	

DEFERRED INFLOWS OF RESOURCES						
Unavailable revenues	102,399		-	9,839		112,238	

FUND BALANCES						
Nonspendable:						
Prepaid expenses	26,276		-	-		26,276	
Restricted:							
Capital projects	-	-	1,225,937	1,225,937	
Unassigned	(107,337)	(5,982,619)	-	(6,089,956)	
Total Fund Balances	  
(81,061)	(5,982,619)	1,225,937	(4,837,743)	
Total  Liabilities,  Deferred Inflows
Resources and Fund Balances	  

   $	106,287	 $ 2,777,587	 $	1,409,343	 $	4,293,217	

Six  Mile  Creek  Community Development  District     RECONCILIATION OF TOTAL GOVERNMENTAL FUND BALANCES TO NET POSITION OF GOVERNMENTAL ACTIVITIES
September 30, 2019

Total Governmental Fund Balances	$ (4,837,743)

Amounts reported for governmental activities in the Statement of Net Position are different because:

Capital assets, land and improvements ($8,230,000), construction in progress ($3,362,721), infrastructure ($3,437,651), improvements ($10,192,800) and equipment ($123,000) net of accumulated depreciation ($(605,177)), used in governmental activities are not current financial resources and therefore, are not reported at the governmental fund level.

24,740,995

Deferred outflows of resources, deferred amount on refunding, net,
are not current financial resources and therefore, are not recognized at
the fund level.	30,128

Long-term liabilities, including bonds payable, $(40,485,000), bond
discount, $146,558, and capital leases, $(14,207) are not due and payable in
the current period and therefore, are not reported at the governmental fund level.

(40,352,649)

Unavailable revenues are recognized as deferred inflows at the fund level, but
this amount is recognized as revenues at the government-wide level.	112,238	
Accrued interest expense for long-term debt is not a current financial use and therefore, is not reported at the governmental fund level.	
(1,412,400)	

Net Position of Governmental Activities	
$ (21,719,431)	

Six Mile Creek Community Development District STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - GOVERNMENTAL FUNDS
For the Year Ended September 30, 2019

Revenues

Total Governmental
 	General		Debt Service	Capital Projects 	Funds	

Special assessments	$ 464,725	$ 4,026,280	$	-	$	4,491,005	
Developer contributions	231,911	-	1,539,311	1,771,222	
Investment earnings	-	15,310	3,820	19,130	
Miscellaneous revenues	 	3,742	 	-	 	193,857	 	197,599	
Total Revenues	 	700,378	 	4,041,590	 	1,736,988	 	6,478,956	

Expenditures Current
General government	118,774	6,085	-	124,859	
Physical environment	369,295	-	-	369,295	
Culture/recreation	276,257	-	-	276,257	
Capital outlay	-	-	2,042,465	2,042,465	
Debt service
Principal	
11,991	
3,990,000	
-	
4,001,991	
Interest	 	1,793	 	1,453,091	 	-	 	1,454,884	
Total Expenditures	 	778,110	 	5,449,176	 	2,042,465	 	8,269,751	
Excess (deficiency) of revenues over (under) expenditures	
 	(77,732)	
     (1,407,586)	
 	(305,477)	
 	(1,790,795)	
Other Financing Sources (Uses) Insurance proceeds	
 	13,921	
 	-	
 	-	
 	13,921	
Net Change in Fund Balances	(63,811)	(1,407,586)	(305,477)	(1,776,874)	
Fund Balances - October 1, 2018	 	(17,250)	     (4,575,033)	 	1,531,414	 	(3,060,869)	
Fund Balances - September 30, 2019	$	(81,061)	$(5,982,619)	$ 1,225,937	$ (4,837,743)	

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, 2019

Net Change in Fund Balances - Total Governmental Funds	$	(1,776,874)

Amounts reported for governmental activities in the Statement of Activities are different because:

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 as depreciation. This is the amount by which capital outlay ($2,042,465) exceeded depreciation ($(591,895)) in the current period.

Bond and capital lease principal payments are recorded as expenditures at the fund level, but reduce liabilities at the government-wide level.

1,450,570

4,001,991

Deferred outflows of resources, deferred amount on refunding, is reflected as an other debt service cost at the fund level, however it is capitalized at the government-wide level and amortized over the life of the bonds. This is the
amount of  current year amortization.	(2,988)

Amortization of bond discount does not require the use of current financial resources and therefore, is not reported in the governmental funds. This is the amount of amortization in the current period.

(7,667)

At the fund level, revenues are recognized when they become available, however, revenues are recognized when they are earned at the government-wide level. This is the amount of the change in earned
revenue that was not available.	112,238

In the Statement of Activities, interest is accrued on outstanding bonds; whereas in the governmental funds, interest expenditures are reported when due. This is the change in accrued interest in the current period.

88,323

Change in Net Position of Governmental Activities	$	3,865,593

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL FUND
For the Year Ended September 30, 2019

	

Original Budget		

Final Budget		

Actual		Variance with Final Budget Positive
(Negative)	
Revenues								
Special assessments	$ 453,832		$ 453,832		$ 464,725		$	10,893	
Developer contributions	534,362		534,362		231,911		(302,451)	
Miscellaneous revenues	 	-		 	-		 	3,742		 	3,742	
Total Revenues	988,194		988,194		700,378		(287,816)	

Expenditures Current								
General government	134,590	134,590	118,774		15,816	
Physical environment	502,600	502,600	369,295		133,305	
Culture/recreation	351,004	351,004	276,257		74,747	
Debt Service				
Principal	-	-	11,991		(11,991)	
Interest	-	-	1,793		(1,793)	
Total Expenditures	 	988,194	 	988,194	 	778,110		 	210,084	
Excess of revenues over/(under) expenditures	-	-	(77,732)		(77,732)	

Other Financing Sources/(Uses)	 			
Insurance proceeds	-	-	13,921		13,921	

Net Change in Fund Balances	 

-	-	(63,811)		
(63,811)	
Fund Balances - October 1, 2018	-	-	(17,250)		(17,250)	

Fund Balances - September 30, 2019	 

   $	-	 $	-	 $ (81,061)		
   $	(81,061)	

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of the District have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The District's more significant accounting policies are described below.

Reporting Entity

The District was established on March 7, 2007, pursuant to the Uniform Community Development District Act of 1980,  Chapter  190,  Florida  Statutes,  as  amended  (the "Act"), by Rule #42GGG-1 Florida Administrative Code, adopted by the Florida Land and Water Adjudicatory Commission as a Community Development District. The District was established for the purposes of financing and managing the acquisition, construction, maintenance and operation of the infrastructure necessary for community  development within its jurisdiction. The District is authorized to issue bonds for the purpose, among others, of financing, funding, planning, establishing, acquiring, constructing district roads, landscaping, and other basic infrastructure projects  within  or  outside  the  boundaries  of the Six Mile Creek Community Development District. The District is governed by a five member Board of Supervisors elected by qualified resident electors residing within the District. The District operates within the criteria established by Chapter 190.

As required by GAAP, these financial statements present the Six Mile Creek Community Development District (the primary government) as a stand-alone government. The reporting entity for the District includes all functions of government in which the District’s Board exercises oversight responsibility including, but not limited to, financial interdependency, selection of governing authority, designation of management, significant ability to influence operations and accountability for fiscal matters.

Based upon the application of the above-mentioned criteria as set forth in Governmental Accounting Standards the District has identified no component units.

Measurement Focus and Basis of Accounting

The basic financial statements of the District are composed of the following:

 Government-wide financial statements

 Fund financial statements

 Notes to financial statements

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Measurement Focus and Basis of Accounting (Continued)

Government-wide Financial Statements

Government-wide financial statements report all non-fiduciary information about the reporting government as a whole. These statements include all the governmental activities of the primary government. The effect of interfund activity has been removed from these statements.

Governmental activities are supported by special assessments.  Program  revenues are netted with program expenses in the statement of  activities to present the net  cost of each program.

Amounts paid to acquire capital assets are capitalized as assets,  rather  than  reported as an expenditure. Proceeds of long-term debt are recorded as liabilities in the government-wide financial statements, rather than as an other financing source.

Amounts paid to reduce long-term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as an expenditure.

Fund Financial Statements

The underlying accounting system of the District is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self- balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Fund financial statements for the primary government’s governmental funds are presented after the government-wide financial statements. These statements display information about major funds individually.

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

2. Measurement Focus and Basis of Accounting (Continued)

b. Fund Financial Statements (Continued) Governmental Funds
The District reports fund balance according to Governmental Accounting Standards Board Statement 54 – Fund Balance Reporting and Governmental Fund Type Definitions. The Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.

The District has various policies governing the fund balance classifications.

Nonspendable Fund Balance – This classification consists of amounts that cannot be spent because they are either not in spendable form or are legally or contractually required to be maintained intact.

Restricted Fund Balance – This classification includes amounts that can be spent  only for specific purposes stipulated by constitution, external resource providers, or through enabling legislation.

Assigned Fund Balance – This classification consists of the Board of Supervisors’ intent to be used for specific purposes but are neither restricted nor committed. The assigned fund balances can also be assigned by the District’s  management  company.

Unassigned Fund Balance – This classification is the residual classification for the government’s general fund and includes all spendable amounts not contained in the  other  classifications.  Unassigned fund balance is considered to be utilized first  when  an expenditure is incurred for purposes for  which  amounts  in  any  of  those unrestricted fund balance classifications could be used.

Fund Balance Spending Hierarchy – For all governmental funds except special revenue funds, when restricted, committed, assigned, and unassigned fund balances are combined in a fund, qualified expenditures are paid first from restricted or committed fund balance, as appropriate, then assigned and finally unassigned fund balances.

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Measurement Focus and Basis of Accounting (Continued)

b. Fund Financial Statements (Continued) Governmental Funds (Continued)
Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are considered to be available when they are collected within the current period or soon 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. Interest associated with the current fiscal period is considered to be an accrual item and so has been recognized as revenue of the current fiscal period.

Under the current financial resources measurement focus, only current assets and current liabilities are generally included on the balance sheet. The reported fund balance is considered to be a measure of “available spendable resources”.

Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly,  they are said to  present a summary of sources  and  uses of “available spendable resources” during a period.

Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.

Amounts expended to acquire capital assets are recorded  as  expenditures  in the year that resources are expended, rather than as fund assets. The proceeds of long- term debt are recorded as an other financing source rather than as a fund liability.

Debt service expenditures are recorded only when payment is due.

Basis of Presentation

Governmental Major Funds

General Fund – The General Fund is the District’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Presentation (Continued)

Governmental Major Funds (Continued)

Debt Service Fund – The Debt Service Fund is used to account for the accumulation of resources for the annual payment of principal and interest on long-term debt.

Capital Projects Fund – The Capital Projects Fund accounts for the acquisition and construction of infrastructure improvements located within the boundaries of the  District.

Non-current Governmental Assets/Liabilities

GASB Statement 34 requires that non-current governmental assets, such as construction in progress, and non-current governmental liabilities, such as general obligation bonds be reported in the governmental activities column in the government-wide Statement of Net Position.

Assets, Liabilities, and Net Position or Equity

Cash and Investments

Florida Statutes require state and local governmental units to deposit monies with financial institutions classified as "Qualified Public Depositories," a multiple financial institution pool whereby groups of securities pledged by the  various  financial institutions provide common collateral from their deposits of  public funds.   This pool   is provided as additional insurance to the federal depository insurance and allows for additional assessments against the member institutions, providing full insurance for public deposits.

The District is authorized to invest in those financial instruments as established by Section 218.415, Florida Statutes. The authorized investments consist of:

Direct obligations of the United States Treasury;

The Local Government Surplus Funds Trust or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperative Act of 1969;

Interest-bearing time deposits or savings accounts in authorized qualified public depositories;

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Assets, Liabilities, and Net Position or Equity (Continued)

Cash and Investments (Continued)

4. Securities and Exchange Commission, registered money market funds with the highest credit quality rating from a nationally recognized rating agency.

Cash and cash equivalents include time deposits,  certificates  of  deposit,  money  market funds, and all highly liquid debt instruments with original maturities of three months or less.

Restricted Net Position

Certain net position of the District are classified as restricted on the Statement of Net Position because their use is limited either by law through constitutional provisions or enabling legislation; or by restrictions imposed externally by creditors. In a fund with both restricted and unrestricted net position, qualified expenses are considered to be paid first from restricted net position and then from unrestricted net position.

Capital Assets

Capital assets, which include land, construction in progress,  infrastructure, improvements other than buildings and equipment, are reported in the governmental activities column.

The District defines capital assets as assets with an initial, individual cost of $5,000 or more and an estimated useful life in excess of two years. The valuation basis for all assets is historical cost.

The costs of normal maintenance and repairs that  do  not  add  to  the  value  of  the  asset or materially extend its useful life are not capitalized.

Major outlays for capital assets and improvements are capitalized as projects are constructed.

Depreciation of capital assets is computed and recorded by utilizing the straight-line method. Estimated useful lives of the various classes of depreciable capital assets  are as follows:

Infrastructure	20 years
Improvements other than buildings	25 years Equipment	10 years

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

4. Assets, Liabilities, and Net Position or Equity (Continued)

Unamortized Bond Discounts

Bond discounts associated with the issuance of revenue bonds are amortized according to the straight-line method of accounting. For financial reporting, unamortized bond discounts are netted against the applicable long-term debt.

Budgets

Budgets are prepared and adopted after public hearings for the governmental funds, pursuant to Chapter 190, Florida Statutes. The District utilizes the same basis of accounting for budgets as it does for revenues and expenditures in its various funds. The legal level of budgetary control is at the fund level. All budgeted appropriations lapse at year end.  Formal budgets are adopted for the general and debt service  funds. As a result, deficits in the budget columns of the accompanying financial statements may occur.

Deferred Outflows/Inflows of Resources

Deferred outflows of resources represent a consumption of net position/fund balance that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District only has one item that qualifies for reporting in this category. It is the deferred amount on refunding reported on the Statement of Net Position. A deferred amount 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.

NOTE	B	–		RECONCILIATION	OF	GOVERNMENT-WIDE	AND	FUND	FINANCIAL STATEMENTS

1. Explanation of Differences Between the Governmental Fund Balance  Sheet  and   the Government-wide Statement of Net Position

“Total fund balances” of the District’s governmental funds ($(4,837,743)) differs from “net position” of governmental activities ($(21,719,431)) reported in the Statement of Net Position. This difference primarily results from the long-term economic focus of the Statement of Net Position versus the current financial resources focus of the governmental fund balance sheet. The effect of the differences is illustrated below:

NOTE	B	–		RECONCILIATION	OF	GOVERNMENT-WIDE	AND	FUND	FINANCIAL STATEMENTS (CONTINUED)

1. Explanation of Differences Between the Governmental Fund Balance  Sheet  and   the Government-wide Statement of Net Position (Continued)

Capital related items

When capital assets (land, improvements, construction in progress, infrastructure and equipment that are to be used in governmental activities) are purchased or constructed, the cost of those assets is reported as expenditures in governmental funds. However, these assets are capitalized at the government-wide level.

Land and improvements		$	8,230,000	
Construction in progress		3,362,721	
Infrastructure		3,437,651	
Improvements other than buildings		10,192,800	
Equipment		123,000	
Less: accumulated depreciation		 	(605,177)	
Capital Assets, net		$ 24,740,995	
Deferred amount on refunding			
Deferred outflows of resources are not recognized at the governmental fund level.	financial resources,	and therefore, are not	
Deferred amount on refunding, net		$	30,128	

Long-term debt transactions

Long-term liabilities applicable to the District’s governmental activities are not due and payable in the current period and accordingly are not reported as fund liabilities. All liabilities (both current and long-term) are reported in the Statement of Net Position. Balances at September 30, 2019 were:

Bonds payable		$ (40,485,000)	
Bond discount, net		146,558	
Capital lease payable		 	(14,207)	
Bonds payable, net
Accrued interest		$ (40,352,649)	
Accrued liabilities in the Statement of	Net	Position differ from the amount reported in	
governmental funds due to the accrued interest on bonds.
Accrued interest	$	(1,412,400)

NOTE	B	–		RECONCILIATION	OF	GOVERNMENT-WIDE	AND	FUND	FINANCIAL STATEMENTS (CONTINUED)
Explanation of Differences Between the Governmental Fund  Balance  Sheet  and the Government-wide Statement of Net Position (Continued)
Deferred inflows of resources

Deferred inflows of resources in the Statement of Net Position differ from the amount reported in the governmental funds due to unavailable revenues. Governmental fund  financial statements report revenues which are not available as deferred inflows of  resources. However, unavailable revenues in governmental funds are susceptible to full accrual in the government-wide financial statements.
Deferred inflows of resources	$	112,238

NOTE	B	–		RECONCILIATION	OF	GOVERNMENT-WIDE	AND	FUND	FINANCIAL STATEMENTS (CONTINUED)
Explanation of Differences Between the Governmental Fund Operating Statements and the Statement of Activities
The “net change in fund balances” for government funds ($(1,776,874)) differs from the “change in net position” for governmental activities ($3,865,593) reported in the Statement of Activities. The differences arise primarily from the long-term economic focus of the Statement of Activities versus the current financial resources focus of the governmental funds. The effect of the differences is illustrated below:
Capital related items
When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those assets are reported as expenditures in governmental funds.  However, in the Statement of Activities, the costs of those assets  is allocated over their estimated useful lives and reported as depreciation. As a result, fund balances decrease by the amount of financial resources expended, whereas net position decrease by the amount of depreciation charged for the year.
Capital outlay	$	2,042,465
Depreciation	 	(591,895)
Total	$	1,450,570
Deferred inflows of resources

Deferred inflows of resources reported at the fund level are recognized as revenues in the Statement of Activities.
Net change in deferred inflows of resources	$	112,238

NOTE	B	–		RECONCILIATION	OF	GOVERNMENT-WIDE	AND	FUND	FINANCIAL STATEMENTS (CONTINUED)

2. Explanation of Differences Between the Governmental Fund Operating Statements and the Statement of Activities (Continued)

Long-term debt transactions

The repayments of bond principal and capital leases are reported as expenditures in the governmental funds and, thus, effect fund balance because current financial resources have been added or used.

Principal payments	$	4,001,991

Amortization of the bond discount and deferred amount on refunding does not require the use of current financial resources and therefore, is not reported in governmental funds.

Amortization of bond discount	$	(7,667)	
Amortization of deferred amount on refunding	 	(2,988)	
Total	$	(10,655)	

Some expenses reported in the Statement of Activities do not require the use of current financial resources, therefore, are not reported as expenditures in governmental funds.

Net change in accrued interest payable	$	88,323

NOTE C – CASH AND INVESTMENTS

All deposits are held in qualified public depositories and are included on the accompanying balance sheet as cash and investments.

Custodial Credit Risk – Deposits

Custodial credit risk is the  risk that in the event of a bank failure, the District's deposits may not     be returned to it. The District does not have a formal deposit policy for custodial credit risk, however, they follow the provisions of Chapter 280, Florida Statutes regarding deposits and investments. As of September 30,  2019,  the  District's  bank  balance  was  $4,203  and  the carrying value was $1,990. Exposure to custodial credit risk was as  follows.  The  District  maintains all deposits in a qualified public depository in accordance with  the  provisions  of  Chapter 280, Florida Statutes, which means that all deposits are fully insured  by  Federal  Depositors Insurance or collateralized under Chapter 280, Florida Statutes.

NOTE C – CASH AND INVESTMENTS (CONTINUED)
Investments
As of September 30, 2019, the District had the following investments and maturities:

 	Investment		 	Maturity		    Fair Value	
U S Bank Managed Money Markey	N/A	$	45,283	
First American Government Obligation Fund	24 days*	249,881	
US Bank Money Market 5	N/A	 	3,352,196	
Total		  $ 3,647,360	

* Weighted average maturity

The District categorizes its fair value measurements within the fair value hierarchy recently established by generally accepted accounting principles. The fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The hierarchy is based on the valuation inputs  used to measure the fair value of the asset. The District uses a market approach in measuring  fair value that uses prices and other relevant information generated by market transactions involving identical or similar assets, liabilities, or groups of assets and liabilities.
Assets or liabilities are classified into one of three levels. Level 1 is the most reliable and is based on quoted price for identical assets, or liabilities, in an active market. Level 2 uses significant other observable inputs when obtaining quoted prices for identical or similar assets, or liabilities, in markets that are not active. Level 3 is the least reliable and uses significant unobservable inputs that use the best information available under the circumstances, which includes the District’s own data in measuring unobservable inputs.
Based on the criteria in the preceding paragraph, U S Bank Managed Money Market and First American Government Obligation Fund are Level 1 assets.
Interest Rate Risk
The District does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates.
Credit Risk
The District’s investments are limited by state statutory requirements and bond compliance.  The District has no investment policy that would further limit its investment choices.

NOTE C – CASH AND INVESTMENTS (CONTINUED)
Concentration of Credit Risk
The District places no limit on the amount it may invest in any one fund. The investments in First American Government Obligation Funds represent 7%, U S Bank Managed Money Market represent 1%, and the US Bank Money Market represents 92% of the District’s total investments. As of September 30, 2019, the District's investment in First American Government Obligation Fund was rated AAAm by Standard & Poor's.
The types of deposits and investments and their level of risk exposure as of  September  30, 2019 were typical of these items during the fiscal year then ended. The District considers any decline in fair value for certain investments to be temporary

NOTE D – INTERFUND BALANCES

Interfund balances at September 30, 2019, consisted of the following:

Payable Fund

Receivable Fund	General Fund
 
Debt Service Fund	$	3,144
Capital Projects Fund	4,153

Total	$	7,297

Amounts due to the Debt Service Fund from the General Fund are related to assessments collected in the General Fund that are allocated to the Debt Service Fund. Amounts due to the Capital Projects Fund from the General Fund relate to a refund for an expenditure paid out of the General Fund for the Capital Projects Fund.

NOTE E – CAPITAL ASSETS

Capital asset activity for the year ended September 30, 2019 was as follows:

Governmental Activities: Capital assets, not depreciated:

Balance	Balance
10/01/2018	Additions	Deletions	09/30/2019

Land and improvements

$ 8,230,000	$

-	$	-

$ 8,230,000

Construction in progress	 	1,320,256		 	2,042,465	 	-	 	3,362,721	
Total capital assets, not being depreciated	 	9,550,256		 	2,042,465	 	-	 11,592,721	
Capital assets, being depreciated: Infrastructure	
3,437,651		
-	-	3,437,651	
Improvements other than buildings	10,192,800		-	-	10,192,800	
Equipment	123,000		-	-	123,000	
Total capital assets, being depreciated	13,753,451		-	-	13,753,451	
Less accumulated depreciation: Infrastructure	
-		
(171,883)	-	(171,883)	
Improvements other than buildings	-		(407,712)	-	(407,712)	
Equipment	(13,282)		(12,300)	-	(25,582)	
Total accumulated depreciation	(13,282)		(591,895)	-	(605,177)	

Total capital assets being depreciated, net	
13,740,169		
(591,895)	-	13,148,274	
Governmental Activities Capital Assets, net	  $23,290,425		  $  1,450,570	 $	-	 $24,740,995	

Depreciation was charged to physical environment, $407,712 and culture/recreation, $184,183.
NOTE F – LONG-TERM DEBT

Governmental Activities

The following is a summary of activity for long-term debt of the Governmental Activities for the year ended September 30, 2019:

Long-term debt at October 1, 2018	$	44,475,000	
Principal payments	 	(3,990,000)	
Long-term debt at September 30, 2019	40,485,000	
Bond discount, net	 	146,558	
Bonds Payable, net	$	40,338,442	

NOTE F – LONG-TERM DEBT (CONTINUED)

Long-term debt for Governmental Activities is comprised of the following

Capital Improvements Revenue Bonds

$47,820,000 Series 2007 Capital Improvement  Revenue  Bonds due in annual principal installments beginning May  2010,  maturing in May 2038. Interest rates ranging from 5.50% to 5.875% is due May 1 and November 1 beginning November
2007.	$ 16,020,000

$3,165,000	Series	2015	Capital	Improvement	Revenue
Refunding Bonds (Assessment Area 1) due in annual principal installments beginning May 2016, maturing in May 2038. Interest rates   ranging   from   3.625%   to   5.000%   is   due   May   1  and
November  1  beginning  November  2015.  Current  portion  is		
$85,000.	$	2,600,000	
$7,315,000 Series 2016A Capital Improvement Revenue Bonds (Assessment Area 2) due in annual principal installments  beginning November 2018, maturing in November 2047. Interest rates ranging from 3.750% to 5.750% is due  May  1  and November 1 beginning November 2017. Current portion is
$50,000.	

$	6,240,000	
$6,720,000 Series 2016B Capital Improvement Revenue Bonds (Assessment Area 2) due at maturity in November 2035. Interest		
rate is 5.875% and is due May 1 and November 1 beginning
November 2017.	$	3,390,000

$10,620,000 Series 2017A Capital Improvement Revenue
Bonds (Assessment Area 2, Phase 2) due in annual principal installments beginning November 2019, maturing in November 2048. Interest rates ranging from 3.625% to 5.250% is due May
1  and  November  1  beginning  May  2018.  Current  portion  is		
$170,000.	$ 10,620,000	
$3,980,000 Series 2017B Capital Improvement Revenue Bonds (Assessment Area 2, Phase 2) due at maturity in November 2029. Interest rate is 5.350% and is due May 1 and November 1
beginning May 2018.	

$	1,615,000	

NOTE F – LONG-TERM DEBT (CONTINUED

The annual requirements to amortize the principal and interest of bonded debt outstanding as of September 30, 2019 are as follows:

Year Ending
  September 30,	 	Principal	 	Interest	 	Total	

2020	$	305,000	$	1,276,791	$	1,581,791	
2021	375,000	1,264,460	1,639,460	
2022	390,000	1,249,325	1,639,325	
2023	400,000	1,233,028	1,633,028	
2024	420,000	1,216,222	1,636,222	
2025-2029	2,405,000	5,772,665	8,177,665	
2030-2034	4,670,000	4,721,813	9,391,813	
2035-2039	7,110,000	3,089,596	10,199,596	
2040-2044	3,830,000	1,779,400	5,609,400	
2045-2049	 	4,560,000	595,588	 	5,155,588	
Totals	  $ 24,465,000	  $ 22,198,888	  $ 46,663,888	

Due to a default, the amortization schedule above does not include the Series 2007 Bonds. Summary of Significant Bond Resolution Terms and Covenants
Capital Improvements Revenue Bonds

Significant Bond Provisions

The District levies special assessments pursuant to Section 190.022, Florida Statutes and the assessment rolls are approved by resolutions of the District Board. The collections are to be strictly accounted for and applied to the debt service of the bond series for which they were levied. The District covenants to levy special assessments in annual amounts adequate to provide for payment of principal and interest on the bonds. Payment of principal and interest is dependent on the money available in the debt service fund and the District’s ability to collect special assessments levied.

The Series 2007, 2015, 2016A, 2016B, and 2017A  Bonds  are  subject  to  redemption  at  the  option of the District prior to their maturity, in whole or in part, in the manner provided by the   Bond Indentures. The Series 2017B Bonds are not subject to optional  redemption  prior  to  maturity. The Series 2007, 2015, 2016A, 2016B, 2017A, and 2017B Bonds are subject to extraordinary mandatory redemption prior to maturity in the manner determined by the Bond Registrar if certain events occur as outlined in the Trust Indentures.

NOTE F – LONG-TERM DEBT (CONTINUED)

Capital Improvements Revenue Bonds (Continued)

Significant Bond Provisions (Continued)

The Trust Indentures establish certain amounts be maintained in a reserve account. In addition, the Trust Indentures have certain restrictions and requirements relating principally to the use of proceeds to pay for the infrastructure improvements and the procedures to be followed by the District on assessments to property owners. The District agrees to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements.

Depository Funds

The bond resolution establishes certain funds and determines the order in which revenues are   to be deposited into these funds.

The following is a schedule of required reserve deposits as of September 30, 2019:

   Capital Improvement Revenue Bonds	Reserve
 	Balance		Reserve Requirement	
Series 2015	$	161,625	$	161,063	
Series 2016A	$	448,319	$	444,463	
Series 2016B	$	205,331	$	199,163	
Series 2017A	$	703,838	$	703,838	
Series 2017B	$	68,012	$	64,802	

Series 2007 Capital Improvement Revenue bonds

Since the 2010 fiscal year, the Developer and its predecessor, failed to make payments on the special assessments which ultimately secure the Series 2007 Bonds. As a result, the debt service payments from November 1, 2011 through those in the current fiscal year have not been made. Such failures to pay the debt service amounts did constitute events of default. In a prior year, the Series 2007 Bond was bifurcated and in another year a portion of the Bond was cancelled with a corresponding reduction in assessments. The District is not in compliance with the reserve requirement established by the Trust Indenture.

NOTE G – CAPITAL LEASE PAYABLE

The District entered into a capital lease agreement for the acquisition of fitness equipment for its amenity center at an annual interest rate of 8.63%. The lease qualifies as a capital lease for accounting purposes, and therefore, have been recorded at the present value of their  future  minimum lease payments at the time of acquisition. The lease commenced in December 2016        for a term of 49 months. As of September 30,  2019,  the  District  held  equipment  under  the  capital lease of  $66,414  with  accumulated  depreciation  of  $19,924.  Depreciation  of  assets under the capital lease is included in culture/recreation in the Statement of Activities.

The future minimum lease obligation and the net present value of these minimum lease payments as of September 30, 2019 were as follows:

Year Ending	Lease
 	September 30,	 	Payment	

2020	$	13,784	
2021	 	1,149	
Total minimum lease payments	14,933	
Less: amount representing interest	(726)	
Present value of minimum lease payments	  $	14,207	

NOTE H – SPECIAL ASSESSMENT REVENUES

Special assessment revenues recognized for the 2018-2019 fiscal year were levied in October 2018. All taxes are due and payable on November 1 or  as soon as the assessment roll is  certified and delivered to the Tax Collector. Per Florida Statute 197.162, discounts are allowed for early payment at the rate of 4% in November, 3% in December, 2% in January, and 1% in February. Taxes paid in March are without discount.

All unpaid taxes become delinquent as of April 1. Virtually all unpaid taxes are collected via the sale of tax certificates on or prior to, June 1.

NOTE I – 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 for which the government carries commercial insurance. Settled claims from these risks have not exceeded commercial insurance coverage over the past three years.

NOTE J – WATER AND SEWER UNIT CONNECTION FEE REFUND AGREEMENT
During a prior fiscal year, the District entered into an updated agreement with St. Johns County relating to water and sewer connection fees. The District constructed certain water and sewer utilities to be owned and maintained by the County. Under the agreement, the County will refund a portion of connection fees collected up to $4,311,421 related to water and sewer utilities that were constructed by the District. During the current fiscal year, $193,857 related to the agreement was received from the County.
NOTE K – ECONOMIC DEPENDENCY
The Developers own a significant portion of land within the District. The District’s activity is dependent upon the continued involvement of the Developers, the loss of which could have a material adverse effect on the District’s operations. At September 30, 2019, three of the five board members are affiliated with the Developers.
NOTE L – RELATED PARTY TRANSACTIONS
The majority of the voting members of the Board of Supervisors are employed by the Developer or a related entity. The Developer or a related entity owns a portion of land within the District; therefore, assessment revenues in the general fund and debt service fund include the assessments levied on those lots owned by the Developer or a related entity.
The Developer has also agreed to fund a portion of the capital improvement projects which are ongoing within the District. Accordingly, the Developer contributed $1,549,150.
NOTE M – CONTINGENCIES
Certain traffic light improvements were constructed on property owned by a neighboring property owner during a prior fiscal year in accordance with an easement between the prior Developer and the property owner. The property owner has taken the position that the District did not have the right to permanently install such improvements on his property and is demanding that they be removed. The matter is currently being negotiated between the District and the property owner, and no accrual has been made as the outcome cannot be determined.
NOTE N – SUBSEQUENT EVENT
Subsequent to year-end, the District prepaid $10,000, Series 2015 Capital Improvement Revenue Bonds, $35,000, Series 2016A Capital Improvement Revenue Bonds, $100,000 Series 2016B Capital Improvement Revenue Bonds, and $545,000 Series 2017B Capital Improvement Revenue Bonds.
In June 2020, the District issued Series 2020 Capital Improvement Revenue and Refunding Bonds, and certain amounts of the Series 2007 Bonds were cancelled. The remaining Series 2007 Bonds outstanding after the issuance of the Series 2020 Bonds is $545,000.
Subsequent to year end, the Bondholder directed the District to cancel and release the lien of assessments on the Series 2007 Capital Improvement Revenue Bonds and the  bonds  are  forever “Unsecured” Bonds. The District has no further obligation to make payment on the Series 2007 Bonds.

INDEPENDENT AUDITOR'S 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
Six Mile Creek Community Development District St. Johns 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 Six Mile Creek Community Development District, as of and for the year ended September 30, 2019, and the related notes to the financial statements, and have issued our  report thereon dated June 29, 2020.

Internal Control Over Financial Reporting

In planning and performing our audit, we considered Six Mile Creek Community Development District's internal control over financial reporting 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 Six Mile Creek Community Development District’s internal control. Accordingly, we do not express an opinion on the effectiveness of Six Mile Creek Community Development District's internal control over financial reporting.

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 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 a 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 over financial reporting 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.

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To the Board of Supervisors
Six Mile Creek Community Development District

Compliance and Other Matters

As part of obtaining reasonable assurance about whether Six Mile Creek Community Development District's financial statements are free of 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 entity’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  entity’s  internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL
Fort Pierce, Florida June 29, 2020

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MANAGEMENT LETTER

To the Board of Supervisors
Six Mile Creek Community Development District St. Johns County, Florida

Report on the Financial Statements

We have audited the financial statements of the Six Mile Creek Community Development District as of and for the year ended September 30, 2019, and have issued our report thereon dated June 29, 2020.

Auditor’s Responsibility

We conducted our audit in accordance with auditing standards generally accepted in the United States; 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 Florida Auditor General.

Other Reporting Requirements

We have issued our Independent Auditor’s 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 and our Independent Auditor’s Report on an examination conducted in accordance with AICPA Professionals 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 June 29, 2020, 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 financial audit report. The following findings or recommendations were made in the preceding financial audit report:

Findings and Recommendations

2017-01, 2016-01, 2015-01, 2012-01, 2012-02, 2011-01

Finding: The debt service fund has a deficit fund balance of $(5,982,619) at September 30, 2019. Due to the Developer’s failure to pay the debt assessments securing its Series 2007  Bonds in the prior fiscal and current years, the District did not have sufficient funds to make certain scheduled debt service payments in the past and current years, as  a  result,  the  payments were not made. The District’s failures to make its scheduled debt service payments when they are due are considered events of default. In addition, the District was not in compliance with the reserve requirement.

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To the Board of Supervisors
Six Mile Creek Community Development District

Findings and Recommendations

2017-01, 2016-01, 2015-01, 2012-01, 2012-02, 2011-01 (Continued)

Recommendation: The District should take the necessary steps to alleviate the financial condition and to comply with the reserve requirement.

Management Response: The District continues to take significant steps to  alleviate  the  deteriorating financial condition. In addition to the issuance of the Series 2015 and Series 2016 Bonds, the District issued Series 2017,  Capital  Improvement  Revenue  Bonds  in  the  current  year, to further develop the District. The real estate market drives demand  which  is  the  determining factor of which part of the District is developed. The continued development of the District will ultimately lead to the development of the property that  secures  the  Series  2007  Bonds which will result in the elimination of the deteriorating financial condition.

Financial Condition and Management

Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply appropriate procedures and communicate the results of our determination as to whether or not Six Mile Creek Community Development District has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify the specific conditions met. In connection with our audit, we determined that Six Mile Creek Community Development District did meet one of the conditions described in Section 218.503(1) Florida Statutes. See Finding 2017-01, 2016-01, 2015-01, 2012-01, 2012-02, 2011-01.

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 Six Mile Creek Community Development District.     It is management’s responsibility to monitor the Six Mile Creek Community  Development  District’s financial condition; our financial condition assessment was based in part on the representations made by management and the review  of  the  financial  information  provided  by the same as of September 30, 2019.

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 warrants the attention of those charged with governance. In connection with our audit, we did not note any such findings.

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To the Board of Supervisors
Six Mile Creek Community Development District

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.

Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL
Fort Pierce, Florida June 29, 2020

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INDEPENDENT ACCOUNTANT’S REPORT/COMPLIANCE WITH SECTION 218.415, FLORIDA STATUTES

To the Board of Supervisors
Six Mile Creek Community Development District St. Johns County, Florida

We have examined Six Mile Creek Community Development District's compliance with Section 218.415, Florida Statutes during the year ended September 30, 2019. Management is responsible for Six Mile Creek Community Development District’s compliance with those requirements. Our responsibility is to express an opinion on Six Mile Creek Community Development District’s compliance based on our examination.

Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about Six Mile Creek Community Development District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on Six Mile Creek Community Development District’s compliance with the specified requirements.

In our opinion, Six Mile Creek Community Development District complied, in all material respects, with the aforementioned requirements during the year ended September 30, 2019.

Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL
Fort Pierce, Florida June 29, 2020

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