HomeMy WebLinkAboutR2026-051 20260323Docusign Envelope ID: EEBC1FBB-4F8E-4B06-ADEC-12345C38EF9F
RESOLUTION NO. R2026-51
A Resolution of the City Council of the City of Pearland, Texas, accepting the
City's Annual Comprehensive Financial Report for Fiscal Year 2025 and the
accompanying independent audit as presented by the accounting firm of
Whitley Penn, LLP.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. That certain Annual Comprehensive Financial Report for Fiscal Year 2025, a
copy of which is attached hereto as Exhibit "A" and made a part hereof for all purposes, is hereby
authorized and approved.
Section 2. That the City Council accepts the City's Annual Comprehensive Financial
Report for Fiscal Year 2025.
Section 3. That acceptance of the Annual Comprehensive Financial Report for Fiscal
Year 2025 reflects the City's compliance with the Federal Single Audit requirements for government
organizations expending federal funds.
PASSED, APPROVED and ADOPTED this the 23rd day of March, A.D., 2026.
DocuSigned by:
J. I E IN-CbtE
MAYOR
ATTEST:
DocuSigned by:
rFratAtt.s aadbu(, (
FRANCES AGUILAR, TRMC, MMC
CITY SECRETARY
APPROVED AS TO FORM:
Signed by:
ERo-eo-o€''''-.
LAWRENCE G. PROVINS
CITY ATTORNEY
or%Y'OF PEARLANO, TX� 6 ',
ir
A1'UJAL O1IREFE IVE
I'PI€IAL REPORT
,SCAL YEAR ENDED
!SEPTEMBER3020
CITY OF PEARLAND, TEXAS
ANNUAL COMPREHENSIVE FINANCIAL REPORT
Fiscal Year Ended
September 30, 2025
Prepared by:
Finance Department
CITY OF PEARLAND, TEXAS
TABLE OF CONTENTS
Page
Introductory Section
Letter of Transmittal
Principal Officials
Organizational Chart
Financial Section
Independent Auditor's Report
Management's Discussion and Analysis
xiii
xiv
3
7
Basic Financial Statements:
Government -Wide Financial Statements:
Statement of Net Position 17
Statement of Activities 19
Fund Financial Statements:
Balance Sheet - Governmental Funds 20
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of
Net Position 23
Statement of Revenues, Expenditures, and Changes in Fund Balances —
Governmental Funds 24
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances
- Governmental Funds to the Government -wide Statement of Activities 27
Statement of Net Position - Proprietary Funds 28
Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Funds 31
Statement of Cash Flows - Proprietary Funds 32
Notes to Basic Financial Statements 35
Required Supplementary Information:
Schedule of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual
- General Fund
Schedule of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual
- Pearland Economic Development Corporation
Notes to Required Supplementary Budget Information
Schedule of Changes in Net Pension Liability and Related Ratios - Texas Municipal Retirement
System
Schedule of Contributions —Texas Municipal Retirement System
Schedule of Changes in the Total OPEB Liability and Related Ratios — Texas Municipal
Retirement System Supplemental Death Benefits Fund
Schedule of Changes the Total OPEB Liability and Related Ratios — City of Pearland
Retirement Health Care Plan
79
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81
82
83
85
86
Other Supplementary Information:
Non -major Governmental Funds:
Combining Balance Sheet — Non -major Governmental Funds 94
Combining Statement of Revenues, Expenditures and Changes in Fund Balances —
Non -major Governmental Funds 102
CITY OF PEARLAND, TEXAS
TABLE OF CONTENTS (continued)
Page
Financial Section (continued)
Other Supplementary Information: (continued)
Combining Statement of Revenues, Expenditures and Changes in Fund Balance —
Budget and Actual:
Debt Service Fund
Special Revenue Funds:
Hotel/Motel Occupancy Tax Fund
Municipal Court Security Fund
City Wide Donation Fund
Court Technology Fund
Street Assessment Fund
Park Donations Fund
Tree Trust Fund
Parks Financial Assistance Donations Fund
Police State Seizure Fund
Police Federal Seizure Fund
Community Safety Fund
Parks & Recreation Development Fund
Sidewalk Fund
Drainage Maintenance Fund
Grant Fund
CDBG Grant Fund
CDBG Disaster Recovery Fund
Disaster Recovery Fund
Hazard Mitigation Fund
Coronavirus Relief Fund
ARPA Fund
Opioid Settlement Fund
Traffic Impact Improvement Fund
Truancy Prevention and Diversion Fund
Municipal Jury Fund
Municipal Channel (PEG) Fund
U of H Fund
Regional Detention Fund
Infrastructure Reinvestment Fund
Combining Statement of Net Position — Internal Service Funds
Combining Statement of Revenues, Expenses and Changes in Net Position —
Internal Service Funds
Combining Statement of Cash Flows — Internal Service funds
110
111
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CITY OF PEARLAND, TEXAS
TABLE OF CONTENTS (continued)
Statistical Section (Unaudited)
Financial Trends:
Net Position by Component
Changes in Net Position
Fund Balances of Governmental Funds
Changes in Fund Balances of Governmental Funds
Revenue Capacity:
Spending and Growth Analysis — Governmental Funds
Assessed Value and Estimated Actual Value of Taxable Property
Direct and Overlapping Property Tax Rates
Property Tax Levies and Collections
Principal Property Taxpayers
Taxable Sales by Category
Debt Capacity:
Outstanding Debt by Type
Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt
Per Capita
Direct and Overlapping Governmental Activities Debt
Pledged Revenue Coverage
Demographic and Economic Information:
Demographic and Economic Statistics
Principal Employers
Operating Information:
Full-time Equivalent City Government Employees by Function/Program
Operating Indicators by Function/Program
Capital Asset Statistics by Function/Program
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152
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INTRODUCTORY SECTION (UNAUDITED)
March 23, 2026
To the Honorable Mayor, Members of City Council, and Citizens of Pearland, Texas:
We are pleased to submit the City of Pearland (the "City") Annual Comprehensive Financial
Report (ACFR) for the fiscal year ended September 30, 2025. The ACFR has been audited by an
independent firm of certified public accountants and reviewed for compliance with applicable local
ordinances, statutes, standards boards, and regulations applicable for any and all public
assistance the City received from the federal government.
The data presented is accurate in all material respects and presented in a manner designed to
set forth the City's financial position and operations of the various funds and accounts. The report
is comprehensive and provides a detailed overview of the City's financial activities for the year.
Pursuant to standards established by the Governmental Accounting Standards Board (GASB),
the City also reports for all funds for which the City, as the primary government, is financially
accountable. As such, this report includes financial activities of two component units The Pearland
Economic Development Corporation (PEDC) and the Development Authority of Pearland (DAP).
Management assumes full responsibility for the completeness and reliability of the information
contained in this report, based upon a comprehensive framework of internal control that it has
established for this purpose. As standard practice, because the cost of internal control should not
exceed anticipated benefits, the objective is to provide reasonable, rather than absolute,
assurance that the financial statements are free of any material misstatements.
Whitley Penn, LLP, Certified Public Accountants, has issued an unmodified (or "clean")
opinion on the City of Pearland's financial statements for the year ending September 30,
2025. The independent auditor's report is located at the front of the financial section of this report.
Management's discussion and analysis (MD&A) immediately follows the independent auditor's
report and provides a narrative introduction, overview, and analysis of the basic financial
statements. The MD&A complements this letter of transmittal and should be read in conjunction
with the transmittal letter. Per Senate Bill 1851, as passed during the 89th Regular Session of the
Texas Legislature, this audit of the City's financials for FY 2025 has been officially filed on record
with the City Secretary of the City of Pearland on March 17, 2026, which is prior to the new
statutory deadline provisions established in the Texas Local Government Code.
The following sections of the Transmittal Letter provide highlights and accomplishments made
during the 2025 fiscal year; including, but not limited to: economic conditions, strategic priorities,
and long-term financial planning information. Awards and acknowledgements are also cited
throughout the Letter, as Pearland received a number of accolades in FY 2025.
PROFILE OF THE GOVERNMENT
The City of Pearland, Texas was incorporated in December 1959 and adopted a Home Rule
Charter on February 6, 1971, operating under a Council -Manager form of government. Policy -
making and legislative authority are vested in a governing Council consisting of the Mayor and
City of Pearland, Texas 2025 ACFR
seven members. The Mayor and Council members are elected at -large, and each of them hold
office for a period of three consecutive years. The office held by the Mayor has no term limitations,
but Council members are limited to two full consecutive terms in office. The City Manager is
appointed by Council and is responsible for recommending a budget, implementation of City
Council priorities, keeping the City Council and community informed during the year, making
recommendations, and day-to-day management of all City operations.
Pearland is primarily located across the northern end of Brazoria County, just south of Houston,
Texas. The City is actually located in three counties, as its city limits are also located in parts of
Fort Bend and Harris counties. The City's incorporated boundaries encompass a total of 49.28
square miles, which is an increase of .46 square miles from FY 2024. This is due to the 2025
annexation of Brazoria Municipal Utility District No. 16, which includes Avalon Terrace
subdivision, Lakeside Estates, and an under construction commercial development.
Pearland has a notable history of fast growth, having increased from 18,000 residents in 1990 to
the current 125,828 residents as reported in the in the official 2020 U.S. Census. This 600% over
thirty years is at the crux of the City's major challenges, which include transportation and traffic
management, water production, wastewater treatment, public safety, parks and recreation, and
other functions of government that serve the Pearland community.
The Pearland community is ripe with economic opportunity, largely due to investments in business
development and jobs. The City provides planning for future land use, traffic control, building
codes, and health inspections, and plans for new infrastructure and rehabilitation of infrastructure
to meet the needs of the citizens today, as well as tomorrow. The City is authorized to issue debt,
subject to certain limitations, for the purpose of financing its capital projects and the City is
empowered to levy a property tax on real property within its boundaries.
Activities of the general, debt service, water and sewer, solid waste, capital project funds, and
special revenue funds such as hotel/motel tax are included in the City's annual appropriated
budget. The legal level of control for each budget is at the fund level. Therefore, total expenditures
for each fund should not exceed total budgeted expenditures for that fund. The City Manager is
authorized to transfer budgeted amounts within and among departments. The City Council must
approve any budget amendment that increases appropriations by fund. The budget is amended
during each fiscal year to refine current year projections for revenues and expenditures.
As an independent political subdivision of the State of Texas, the City is considered a primary
government. Pursuant to standards established by the Governmental Accounting Standards
Board (GASB), the City reports on all funds for which the City is financially accountable. As such,
this report also includes financial activities of two Component Units: The Pearland Economic
Development Corporation (PEDC) and the Development Authority of Pearland (DAP). The
Pearland Economic Development Corporation was created by the City in 1995 under the Texas
Development Corporation Act of 1979 to promote, assist, and enhance economic and related
development activities on behalf of the City. The DAP was created in 2004 to further assist with
these objectives, acting as a fiduciary for specific community economic development initiatives.
ii City of Pearland, Texas 2025 ACFR
ECONOMIC CONDITIONS
Local and Regional Economy
Pearland is a premier location for residential and commercial growth, with an economy that is
inexorably linked with the Houston metropolitan area. The City is located 20 minutes away from
downtown Houston, the nation's second largest seaport, the world-renowned Texas Medical
Center, Port of Houston, Port Freeport, major chemical refineries in south Brazoria County, and
NASA -Johnson Space Center.
With available land, business facilities, a sound infrastructure, and a diverse workforce supported
by educational programs, Pearland's growth has been consistent, with continued residential and
commercial development forecasts on the horizon. Energy, healthcare and life sciences, and
manufacturing have been key areas of interest for Pearland for over ten years, combined with a
mix of reinforcing land uses, urban planning, key entertainment and cultural attractions, public
spaces, and walkability and connectivity provide for livable, sustainable developments.
The total of new, non-residential construction permitted during the fiscal year was approximately
$661 million, a decrease of 13.25% in value from FY 2024's $762 million. New single-family
housing permits totaled 442, up 145.5% from the previous FY. One multi -family permit was issued
in FY 2025 for Pearland Town Center Apartments (Pelican), a 377 -unit project. Building permits
revenues increased by $1,016,247.00 or approximately 33.8% as compared to FY24 revenue
collections.
In October 2024, at the start of FY 2025, Pearland's unemployment rate remained steady at 4.0%,
the same as at the beginning of FY 2024. Throughout the course of the year, unemployment
dropped to as low as 3.5% in April 2025, before it began to increase up to 4.2% by the end of the
fiscal year (September 2025)1. Compared to the rates for the same time periods for Brazoria
County, the unemployment rate for the County was 4.3% in October 2024 and 4.9% by September
20252.
The Consumer Price Index (CPI) is trending in line with steadier economic times, as the economic
impacts of the pandemic have mostly subsided. The annual declines from the 2022 8% CPI are
starting to normalize at or below the 2024 average of 2.9%, with a 2025 average of 2.6%.
However, even though the December 2025 unemployment rate shows a decline from the previous
quarter, we enter into mid -2026 with some level of uncertainty when it comes to the direction of
the economy. The basis for this uncertainty largely rests with current geopolitical tensions
throughout global markets and a labor market in demand of close monitoring for significant
weakening. According to the Federal Reserve Bank, a slowing labor market has driven several
interest rate reductions in 2025, as the central bank aims to lower borrowing costs for consumers
and businesses, with an objective towards stimulating economic growth, amid concerns of rising
unemployment and slowing job creation. Tensions at the Federal Reserve Bank have arisen from
the "dual mandate" of having to navigate a mixed economic picture, which includes the need to
maximize employment and also maintain price stability.
1 https://ycharts.com/indicators/pearland_tx_unemployment_rate. February 17, 2026
2 https://ycharts.com/indicators/brazoria_county_tx_unemployment_rate. February 17, 2026
iii City of Pearland, Texas 2025 ACFR
Unfortunately, the immediate future is somewhat of a "coin flip," as consistent strength in labor
data is yet to be seen at the time of this report and the Federal Reserve Bank remains wary of
"low hire" dynamics. With an estimated 7.5 million job seekers compared to 6.5 million job
openings, February 2026 labor data may confirm the strength of January 2026 numbers, or reveal
the January data was a one-time anomaly. For the City, all of these factors equate to the
importance of valuing long-term financial planning, diversification of our municipal investment
portfolio, and budgeting based on Strategic Priorities.
Lona-Term Financial Plannina
The City adopts a one-year operating budget, including a five-year capital improvement program
(CIP). Even though a one-year budget is adopted, the budget implements strategies, both
financial and operational, to meet existing challenges and to plan ahead.
The City's adopted (September 8, 2025) Five -Year CIP for fiscal years 2026 through 2030 totals
$559.5 million. The large and varying CIP for public investments of drainage, parks, facilities,
streets, water, and wastewater positions City infrastructure for serving the population and
businesses that are here and yet to come. The 2026-2030 CIP document completes the balance
of the $162 million bond program approved by the voters in May 2007. As well as $181.3 million
bond referendum in May 2023.
Funding for projects is supported by non -debt sources ($2 million), leveraged outside funds ($52.6
million), tax -supported debt ($200 million), and water/sewer-supported enterprise fund debt
repaid by user fees ($361 million). The ratio of outstanding property tax -supported Debt to taxable
assessed valuation increased slightly from the previous year and remains well below 5% at about
3.13%.
For non -enterprise general obligations, the Debt Service Fund can meet current and future
obligations based on the City's Multi -Year Forecast and Five -Year CIP where needed. Issuance
of debt is factored into funding sources, based on the Five -Year CIP. The City's property tax rate
for the FY 2026 budget is $0.630000 of which $0.259539 cents is for actual debt service and
$.018957 cents is for rebates to in -city MUD districts but considered as debt service component.
The Debt Service component, inclusive of in -City MUD district rebates, for the FY 2026 budget
was $0.278496.
The City completes a Water/Sewer Cost of Service Rate Study annually for the forecast. The
study is built around the Five -Year CIP, operating budget, and future needs. Rate customers saw
a 14% increase in fiscal year 2024 and a 7% increase in fiscal year 2025. Rate increases are
primarily driven by the Capital Improvement Plan which allows for the construction and
rehabilitation of plants, distribution and collection lines, and a variety of modernizations to meet
needs of the current and future community. Continued expansions and improvements will require
appropriate rate increases to provide adequate upkeep of the system in future years
Investments
The City will continue supporting its FY25 Investment Policy update, which now involves more
diversification and an emphasis on ensuring liquidity. Prioritizing the safety of the City's principal
in the investment portfolio will avoid capital losses, as we invest in secure, high -quality
instruments. The City engaged Hilltop Securities Asset Management LLC as its investment
iv City of Pearland, Texas 2025 ACFR
advisor in FY 2025, with the intent to produce a more robust approach to managing the portfolio
of securities.
Relevant Financial Policies/Guidelines
Financial Policies guide the development and implementation of the budget, are a framework for
fiscal decision making, and ensure financial resources are available to meet the current and future
needs of the City. The policy statements address areas of reporting and auditing, budgeting,
revenues, capital improvements, debt, and grants to name a few. Some of the most relevant
policies are:
• Recurring revenues fund recurring expenditures/expenses
• Non -recurring funds fund non -recurring expenditures/expenses
• General Fund Operating Reserves should be a minimum of three months of operations
• Meet a 1.15 Bond Coverage Requirement and the annual Debt Service Reserve set by
Bond Ordinances. Maintain a cash equivalent operating reserve at 15% of the current
year's budget appropriation for total operating expenses in the Water/Sewer operating
fund. The aggregate between the reserve balances of the Water/Sewer operating fund
and Water/Sewer debt service fund shall be no less than 25%.
• Budget revenues on a conservative basis
• Fund existing services at current service levels
• Enterprise Funds must be self-supporting
• Leverage City dollars by seeking outside funding sources
STRATEGIC PRIORITIES
Trusted Government
Public trust is the core element of government in its relationship with those it serves. The City of
Pearland strives to deliver transparent, high -quality, and accessible city services by developing
cutting edge solutions, engaging with the community, and continuously improving our capabilities.
The City formed the Office of External Affairs (OEA) in FY 2025 for the purpose of extending the
organization's reach on matters concerning legislative impacts, intergovernmental relations, and
our interactions with non -governmental community -based organizations. OEA worked closely
with Pearland's elected leadership and State lawmakers during the Texas 89th Legislative Session
to protect the City from challenges to our local control. Successful measures included our efforts
to limit the impact of preemptive legislation allowing "tiny lot" single family residential
development, "by right," and a number of advocacy actions aimed at protecting cities' debt service
capabilities.
A number of transparency improvements were made in FY 2025, such as quarterly reports to the
City's Audit Committee and progress reports on internal control reviews. The City also instituted
a more user-friendly format for the process of completing Council agenda item requests.
During the fiscal year, the City Secretary's Office was awarded the Texas Municipal Clerks
Association's Municipal Clerk's Office Achievement of Excellence Award, which is designed to
v City of Pearland, Texas 2025 ACFR
recognize excellence in the effective and efficient management of resources within a municipal
clerk's office. In addition, Pearland was awarded the "Transparency Star in Open Government
and Compliance" award by the State Comptroller's Office.
Strong Economy
The Pearland Economic Development Corporation (PEDC) and Visit Pearland are two key
elements of the City's efforts to ensure Pearland has the economic sustainability to endure long-
lasting growth and development, vibrant businesses, job creation and retention, attractive
visitation and tourism, and diverse financial resources. Revenues from the one-half cent allocation
of local sales and use tax collections and a 7% local hotel occupancy tax provide the impetus for
significant economic development opportunities throughout the City.
Throughout 2025, PEDC continued to coordinate implementation efforts for the Pearland
Prosperity community strategic plan. At the center of the Pearland Prosperity framework is one
overarching Community Goal that broadly identifies the desired outcomes of Pearland's
holistic economic development effort: Pearland will be the community of choice for People
and Business in our region. This goal can be pursued through a number of Strategic
Recommendations grouped into eleven high-level Key Initiatives: Places to Gather, Old Town
Revitalization, Infill and Redevelopment, Mobility and Infrastructure, Parks and Recreation,
Cultural Arts, Site Development, Diverse Talent, Workforce Development, Pearland innovation
Hub and Business Development.
Pearland's largest speculative industrial development, Levey Logistics Park, developed by Levy
Group, is now 88% leased, marking a major milestone for Pearland's Lower Kirby District.
Creative Innovations leased the entire 496,560 -square -foot cross -dock facility for e -commerce
logistics, while Canopy Solutions occupies 82,560 square feet in the rear -load building. PEDC,
the City of Pearland, and the Lower Kirby Pearland Management District partnered with Levey in
2022, investing $1.6 million in infrastructure improvements to accelerate delivery.
Stream Realty Partners is nearing completion of new Class -A flex buildings in Pearland's Lower
Kirby District. Two buildings totaling 384,509 square feet of premier industrial space will offer a
mix of office, warehouse, and manufacturing spaces on a 24 -acre site at the northeast corner of
Kirby Drive and N. Spectrum Boulevard. Completion is expected in early 2026.
United Imaging, a global leader in advanced medical imaging technology, has expanded its
manufacturing, R&D, and warehousing operations to Pearland's Lower Kirby District, leasing
216,000 square feet at 11550 N Spectrum Boulevard. The Class A facility, developed by Brennan
Investment Group, offers proximity to the Texas Medical Center, a skilled workforce, and a
business -friendly environment —key factors in the company's decision to grow in the region.
Lonestar Industrial Electric Supply is now operating in its 114,680 -square -foot Class A
distribution facility at Beltway 8 and Hooper Road. The facility supports approximately 80 jobs and
provides essential industrial electrical supplies to contractors nationwide.
Progress continues at Edge Industrial Park, a 36 -acre business park at State Highway 35 and
McHard Road, delivering more than 200,000 square feet of flex office, warehouse, and
vi City of Pearland, Texas 2025 ACFR
manufacturing space. Led by Stewart Development, the project is a priority within the SH 35
Redevelopment Plan and aligns with Pearland's long-term vision for economic growth. As of late
2025, three buildings are complete, and planning is underway for the next phase of construction.
In 2025, the Pearland Innovation Hub, Pearland's Small Business resource hub, reached a
major milestone with the renewal of its three-year management agreement with the Pearland
Chamber of Commerce, ensuring operational continuity through September 2028. PIH hosted two
signature events in 2025 —the first Pitch Competition in May and the annual State of
Entrepreneurship in November —alongside monthly programs like Morning Brew Connections
and Funding Strategies.
In 2025, PEDC worked closely with local employers to secure more than $1.5 million in grant
funding for employee training programs. These resources enabled companies to provide
specialized technical instruction, leadership development, and operational training at no cost to
their workforce. By connecting businesses with state and federal funding and workforce partners,
PEDC strengthens talent pipelines and enhances competitiveness in Pearland's manufacturing
and industrial sectors.
Strengthening Pearland's economy also means promoting the City of Pearland as a destination
to out-of-town visitors through creative marketing, sales, and outreach strategies. Sports
tournaments, cultural festivals, showcasing local assets through campaign promotions such as
"Pearland Restaurant Weeks" and "Boutique Shop & Hop" -plus tours of various landmarks in the
community are just some of the ways Visit Pearland has continued to promote the vibrancy of our
city. Visit Pearland received the Heritage Tourism Achievement Award in FY 25.
Other community and economic development activities include continued implementation of the
Pearland Prosperity Plan, as well as the continued nurturing of sports tourism initiatives, including
tournament recruitment, servicing, and sports facility improvements.
Safe Community
Pearland's Safe Community Strategic Priority is aimed at making Pearland a welcoming place by
ensuring a safe environment and providing efficient Public Safety services for residents,
businesses, and visitors. The Pearland Fire Department (PFD), Pearland Police Department
(PPD), and other key public safety divisions within the City's organization provide the crux of this
portion of the Strategic Priorities.
In FY 2025, the Pearland Police Department opened the first Real Time Crime Center located in
Brazoria County and Animal Services celebrated its 6th anniversary as a "no kill" animal control
operation, relying heavily on best practices adoption and management policies. The Shelter
maintained a 95% Live Release Rate, exceeding the Asilomar Accords 90% standard. Medical
vii City of Pearland, Texas 2025 ACFR
services were brought in-house in FY 25 through the addition of a part-time Veterinarian, providing
more timely treatment of animals and enhanced continuity of care.
PPD also established a dedicated Narcotics Unit in FY 25, marking a significant expansion of
the department's investigative capabilities. Since its formation, the unit has seized more than 15
kilograms of narcotics with an estimated "street value" of more than $200,000. A total of $62,000
in cash, a vehicle, and five (5) handguns were seized in FY 25, underscoring PPD's commitment
to disrupting drug trafficking and its associated impact on Pearland public safety.
Pearland Fire Department (PFD) engaged in a number of public safety improvements throughout
the fiscal year. Most notable include the receipt of two (2) new firefighting apparatus
(Pumper/Engine No. 2 and Engine No. 5), the department's institution of a Whole Blood
Program, and the initiation of a Blocker Program to protect large-scale vehicle accidents from
oncoming traffic during crash -scene investigations.
The City also received the Texas Fire Marshall Association Award of Excellence and an EMS
Gold Plus Lifeline Award from the American Heart Association (AHA). The City also became a
FEMA Interactive Public Alerts and Warnings System (IPAWS) alerting authority. The Fire
Department also led Statewide initiatives to develop effective standards for responding to fires
involving Electric Vehicles (EVs).
Sustainable Infrastructure
A significant portion of Pearland's quality of life rests with its well -planned and maintained water,
transportation, flooding infrastructure, and amenities, producing long-term value. With continued
residential and commercial development, the need to plan and build new infrastructure and
maintain and replace existing infrastructure is a priority and will be implemented through our
capital improvement program. The City's adopted Five -Year CIP 2026-2030 totals $1.06 billion.
Projects include $154.3 million in improvements to local drainage, $55.1 million in parks and
recreation projects, $182.1 million in facilities improvements, $138 million for streets, and a $530.6
million investment in our local water production and wastewater treatment systems.
In FY 2025, Pearland Water launched an Asset Reliability Program designed to improve
maintenance and longevity of all water production and wastewater treatment systems. Per federal
requirements, Pearland Water has also completed Environmental Protection Agency (EPA) and
Texas Commission on Environmental Quality (TCEQ) requirements for identifying lead and
copper in the public drinking water system, per EPA Lead and Copper Rule Revisions (LCRR)
and Lead/Copper Rule Improvements (LCRI).
The next phase of LCRR and LCRI activities will involve removal and replacement of affected
materials, such as lead and galvanized service lines. Fiscal year 2025 was a proud year for
Pearland Water, earning the TCEQ Outstanding Cross -Connection Control Program award
for protecting our public water supply from contamination by identifying and mitigating dangerous
links between potable water and non -potable sources.
viii City of Pearland, Texas 2025 ACFR
Engineering & Public Works (EPW) continues construction on the Barry Rose Water
Reclamation Facility Expansion, which includes the decommissioning of the aged Longwood
Wastewater Treatment Plant along Dixie Farm Road. All lines of service directed to Longwood
will soon be redirected to the new and improved Barry Rose facility. The Longwood facility will be
converted into a Lift Station. This project's $263 million investment is the largest Capital
Improvement Program project in Pearland's history.
EPW has also launched its Advanced Distribution & Collection System Rehabilitation
program, using data -driven asset management, trenchless technologies, and hydraulic
monitoring to extend the life of aging water and wastewater infrastructure. Additionally, EPW has
regraded approximately 85,000 linear feet of drainage ditches through City crews and contractors,
reducing the potential for flooding in areas with outdated open ditch sizes and culverts.
Resilient Finances
The City's Resilient Finances Strategic Priority focuses on providing long-term community value
through trusted stewardship and responsible financial management. FY 25 accomplishments
included a clean FY24 audit, the implementation of an internal controls review process to manage
compliance and risk, customized investment portfolio by contracting services with Hilltop
Securities, conducted updates to the Financial and Investment Policy. The establishment of a
new Accounts Receivable division within the department to oversee revenue management
involving payments to the City, along with establishing a Special Event Revenue & Collections
Process. The Finance Department created two key positions dedicated to the City's Capital
Improvement Program: CIP Accountant and CIP Procurement Specialist. Both positions
support the need for improvements to CIP related procurement, invoicing, and asset accounting.
The Finance Department also established an internal Cooperative Purchasing Evaluation process
to ensure the City is receiving the best value when purchasing goods and services through
Cooperative Purchasing entities.
Connected Community
In support of the Strategic Priority of a Connected Community, the Pearland Customer
Experience Team was created in FY 25 to ensure the timely and accurate flow of information to
residents, while strengthening coordination and collaboration across departments and divisions.
As the City's primary point of contact and central conduit for information, the team advances a
proactive, "People First" approach to the customer experience. While phone calls remain the
primary method of engagement, residents may also connect with the team via email, the City
website, and the Connect2Pearland mobile app to access services and information.
The Parks and Recreation Department is an essential part of the Connected Community
Strategic Priority, as it protects, maintains, and operates 26 parks facilities encompassing 562
acres of City -owned parkland, and includes over 18 miles of existing City trails. These resources
are key aspects of our efforts to connect residents, through placemaking and recreational
opportunities throughout the City, fostering a sense of belonging and encouraging opportunities
to connect through multifaceted events, services, amenities, and gathering spaces.
ix City of Pearland, Texas 2025 ACFR
Special events and park utilization provided community engagement throughout the fiscal year,
drawing approximately 85,500 attendees to our facilities and activities. A total of 7,688 pavilion
and field rentals, 919,200 visits to Pearland athletic fields, and 1.62 million visits to local parkland
and greenspaces are just some of the statistical examples of the value of our parks and recreation
offerings.
More than 13,500 residents enrolled in programs and athletic leagues and there were 30,229
visits to the Melvin Knapp Activity Center. The Knapp Center also facilitated 12,367 meals for
seniors. Lastly, the Pearland Recreation Center & Natatorium (RCN) sustained its consistent
usage with 5,489 active members and 2,426 group fitness classes. An estimated 319,000 visits
to the RCN occurred during FY 25.
Finally, annexation of Brazoria County MUD 16 into the City limits played an important role in
meeting Connected Community objectives, as the area once represented a centrally located
jurisdictional disconnect, as MUD 16 was the only part of Pearland's extraterritorial jurisdiction
(ETJ) totally surrounded by Pearland city limits. Incorporating this area promoted geographic
continuity where there was none, eliminating the boundary between the former MUD's
subdivisions (Avalon Terraces I/II and Lakeside Estates) and the City. This initiative reduced the
cost of water and sewer services for these neighborhoods, as they no longer have to pay 1.5
times the in -city rates for utilities, and eliminated the neighborhoods' need to pay separate
additional fees for City fire protection and Brazoria County Constable's law enforcement patrols
of the area.
Fiscal Responsibility and Sustainability
The City continues to strive for high levels of fiscal responsibility and sustainability, managing
public funds prudently to meet current obligations and ensuring future generations of taxpayers
do not face an undue burden for services provided to the current generation. Short-term fixes
and/or unsustainable, one-time revenues fail to meet the needs of the community, so long-term
economic budgeting and debt management strategies have been utilized to promote the
opportunity to complete critical capital improvements.
City Management and Council take a proactive stance in ensuring the fiscal health and
sustainability of the City, primarily through an adopted set of Financial Management Policy
Statements and quarterly financial reports that include economic indicators. The City also
prepares a Five -Year Forecast for the City's major funds to monitor how spending decisions made
today affect the future. The Forecast also helps identify any issues and concerns that are
forthcoming and put strategies in place to address future challenges.
One such issue involves the State Legislature and its expressed intent to reshape property tax
policy, statewide, which has the potential to reshape how municipal government revenues are
created. Management and Council are dedicated to monitoring for advocacy opportunities that
can help shape the future of legislative impacts, but the reality is that some level of change is on
the horizon. Interim charges from the State's top elected officials indicate property tax reform will
be a high priority for lawmakers during the next session of the Texas Legislature in 2027, but for
x City of Pearland, Texas 2025 ACFR
now, property tax revenue is projected to continue to be a strong revenue component for local
operations. Local Pearland sales taxes have continued to grow, with FY 25 General Fund sales
tax revenue increasing by approximately 3.85% from the prior fiscal year.
Grants and Public Assistance
The City of Pearland continues to be a recipient and subrecipient of federal and state government
grants. The City receives entitlement funding allocated based on the submission of annual
expenditure plans, as well as funding from competitive grant programs. Pearland has been one
of the most successful awardees amongst its benchmarks throughout the region, with more than
$245 million in federal grant expenditures since 2016.
For FY 2025, the City's expenditures from federal awards total $11,995,277. Federally funded
grant activities in FY 2025 included $527,636 in U.S. Department of Housing & Urban
Development (HUD) Community Development Block Grant (CDBG) entitlement jurisdiction
projects, $2.2 million in HUD Hurricane Harvey disaster recovery assistance from the Texas
General Land Office (GLO), and $4.9 million in Federal Highway Administration roadway
improvements funded via the Texas Department of Transportation (TxDOT).
Federal Emergency Management Agency (FEMA) funded $1.1 million in local buyouts and home
elevation activities designed to mitigate repetitive flood loss damages to homes in Pearland, and
the City began to design future flood mitigation drainage projects with another $875,603 from the
GLO. Texas Division of Emergency Management (TDEM) reimbursed the City for $168,292 in
expenditures for its support of mutual aid provided to various disasters throughout the State of
Texas, via the Texas Intrastate Fire Mutual Aid System (TIFMAS). In addition, the City received
$81,554 from the TCEQ for solid waste management activities, and Texas Commission on Law
Enforcement (TCOLE) doubled its support for police training resources to $23,063 in FY 25.
Lastly, the City utilized $899,161 in American Rescue Plan Act (ARPA) funding towards matching
local funds for the purchase of a new fire truck. Altogether, State and federal assistance during
FY 25 provided $12,268,186 in funding for items that benefit Pearland residents in public safety,
disaster recovery, transportation, and community development.
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association (GFOA) of the United States and Canada awards
the Certificate of Achievement for Excellence in Financial Reporting to applicants for their
Comprehensive Annual Financial Report annually. The City has received this award for 48
consecutive years. To be awarded a Certificate of Achievement, a governmental unit must publish
an easily readable and efficiently organized comprehensive annual financial report.
The City has received the GFOA's Distinguished Budget Presentation Award for 38 consecutive
years and is currently awaiting approval for the 39th year, which would include its Fiscal Year
2025 budget document. In order to qualify for the Distinguished Budget Presentation Award, the
xi
government's budget document had to be judged proficient as a policy document, a financial plan,
an operations guide, and a communications device.
The preparation of this report is accomplished with the dedicated service of the accounting staff
of the Finance Department. We express our sincere appreciation to these individuals who have
continually demonstrated the core beliefs of the City and who assisted and contributed to the
preparation of this report. We also thank the Mayor and members of the City Council for their
support in planning and conducting the financial operations of the City in a responsible manner.
Respectfully submitted,
7
Trent Epper 6r
City Manager
had Randall
Assistant City Manager
Victor Brownlees
Je ifer May
Assistant City Manager
Deputy City Manager
61,a, u0.
enecha Williams
Interim Director of Finance
xii
CITY OF PEARLAND, TEXAS
PRINCIPAL OFFICIALS
September 30, 2025
Elected Officials
Kevin Cole
Clint Byrom
Joseph Koza
Tony Carbone
Mona Chavarria
Layni Cade
Rick Fernandez
Rushi Patel
Audit Committee Members
Kevin Cole
Tony Carbone
Mona Chavarria
City Management
Trent Epperson
Ron Fraser
Victor Brownlees
Chad Randall
Melissa Saxton
Joel Hardy
Rachel Wynslow
Matt Buchanan
Jack Taylor
Frances Aguilar
Lorenzo Wingate
Yesenia Spires
Johnny Spires
Carry Capers
Vance Wyly
Tracy Rohrbacher
Joshua Lee
Darrin Coker
Daniel McGhinnis
David Sohns
Letitia Farnie
Position
Mayor
Mayor Pro Tern - Position 4
Councilmember - Position 1
Councilmember - Position 2
Councilmember - Position 3
Councilmember - Position 5
Councilmember - Position 6
Councilmember - Position 7
Position
Mayor
Councilmember - Position 2
Councilmember - Position 3
Term Expires
May
2026
2027
2028
2027
2026
2028
2028
2026
Position
City Manager
Deputy City Manager
Assistant City Manager
Assistant City Manager
Director of Finance
Head of External Affairs - Grants
Head of Office of Management & Budget (OMB)
President, Pearland Economic Development Corporation (PEDC)
Fire Chief
City Secretary
Director of Engineering & Public Works
Director of Human Resources
Police Chief
Director of Parks & Recreation
Director of Community Development
Executive Director, Convention & Visitors Bureau (CVB)
Director of Communications
City Attorney
Chief Information Officer
Director of Utilities
Municipal Court Judge
r
CITY OF PEARLAND, TEXAS
ORGANIZATIONAL CHART AS OF SEPTEMBER 30, 2025
Staff Organization
Pearland Citizens
Mayor & City Council
Legal
Municipal Court Judge
City Manager
Communications
Information Technology
Engineering and Public Works
Pearland Water
f
Deputy City Manager
City Secretary
Municipal Court
Human Resources
Fire
Police
Office of Emergency Management
Assistant City Manager
Community Development
Finance
Visit Pearland
Office of Management and Budget
Parks and Recreation
xiv City of Pearland, Texas 2025 ACFR
FINANCIAL SECTION
1 City of Pearland, Texas 2025 ACFR
2 City of Pearland, Texas 2025 ACFR
INDEPENDENT AUDITOR'S REPORT
To the Honorable Mayor and Members of City Council
City of Pearland, Texas
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and
the aggregate remaining fund information of the City of Pearland, Texas (the "City"), as of and for the year ended September
30, 2025, and the related notes to the financial statements, which collectively comprise the City's basic financial statements
as listed in the table of contents.
In our opinion, the accompanying financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining
fund information of the City, as of September 30, 2025, and the respective changes in financial position, and, where
applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the
United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS)
and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States. Our responsibilities under those standards are further described in the Auditor's Responsibilities
for the Audit of the Financial Statements section of our report. We are required to be independent of the City, and to meet
our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with
accounting principles generally accepted in the United States of America, and for the design, implementation, and
maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events,
considered in the aggregate, that raise substantial doubt about the City's ability to continue as a going concern for twelve
months beyond the financial statement date, including any currently known information that may raise substantial doubt
shortly thereafter.
3 City of Pearland, Texas 2025 ACFR
To the Honorable Mayor and Members of City Council
City of Pearland, Texas
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable
assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted
in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The
risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are
considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the
judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test
basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City's
internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about the City's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit, significant audit findings, and certain internal control -related matters that we identified during the
audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that management's discussion and analysis,
pension information, other -post employment benefit information, and certain budget to actual schedules, as listed in the
table of contents, be presented to supplement the basic financial statements. Such information is the responsibility of
management and, although not a part of the basic financial statements, is required by the Governmental Accounting
Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an
appropriate operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with 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.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's
basic financial statements. The combining and individual fund statements and schedules and certain budget to actual
schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such
information is the responsibility of management and was derived from and relates directly to the underlying accounting and
other records used to prepare the basic financial statements.
4 City of Pearland, Texas 2025 ACFR
To the Honorable Mayor and Members of City Council
City of Pearland, Texas
The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and
certain additional procedures, including comparing and reconciling such information directly to the underlying accounting
and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other
additional procedures in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the combining and individual fund statements and schedules and certain budget to actual schedules, are fairly stated,
in all material respects, in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other information comprises the
introductory and statistical section, but does not include the basic financial statements and our auditor's report thereon. Our
opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form
of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider
whether a material inconsistency exists between the other information and the basic financial statements, or the other
information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected
material misstatement of the other information exists, we are required to describe it in our report.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 23, 2026 on our
consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions
of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the
scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to
provide an opinion on the effectiveness of the City'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 City's internal
control over financial reporting and compliance.
Houston, Texas
March 23, 2026
5 City of Pearland, Texas 2025 ACFR
6 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
As Management of the City of Pearland, Texas (the City), we offer readers of the City's financial statements this narrative
overview and analysis of the financial activities of the City for the fiscal year ended September 30, 2025. This information is
not intended to be a complete statement of the City's financial condition. We recommend and encourage readers to consider
the information presented here in conjunction with the additional information presented in the accompanying transmittal
letter (Pages i - xii of this report), and the statistical section (Pages 149 - 190 of this report), as well as the annual budget
found on the City's website at https://www.pearlandtx.gov/.
Financial Highlights
• The assets and deferred outflows of resources of the primary government of the City exceeded its liabilities and
deferred inflows of resources as of September 30, 2025, by $1,029.0 million (net position). Of this amount, $741.4
million is invested in capital assets, net of related capital debt and $117.6 million is restricted for capital
improvements, debt service, community development programs, public safety, economic development, tourism,
and grants. The remaining $169.9 million net position is unrestricted.
• The City's total net position increased by $21.3 million due to increases in utility billing charges, property taxes, sales
taxes, and investment earnings.
• As of September 30, 2025, the City's governmental funds reported combined ending fund balances of $226.3 million,
a decrease of $3.9 million in comparison to the prior year. Approximately $192.1 million of the $226.3 million is
considered restricted fund balance and primarily consists of $75.1 million for economic development and $98.6
million for capital projects.
• As of September 30, 2025, the fund balance of the General Fund was $36.6 million, all of which was unassigned,
except for $42,678 which was nonspendable for prepaid items. Unassigned fund balance represents 31% of total
General Fund expenditures.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's basic
financial statements are comprised of three components: 1) Government -wide financial statements, 2) fund financial
statements, and 3) notes to the financial statements. Additionally, required supplementary information which includes this
management's discussion and analysis, information related to the City's pension plan and retiree health plans and budgetary
comparison information is also included in this report. This report also contains other supplementary information as listed in
the table of contents in addition to the basic financial statements themselves.
Government -wide Financial Statements. The government -wide financial statements are designed to provide readers with a
broad overview of the City's finances, in a manner similar to a private -sector business.
The Statement of Net Position presents information on all of the City's assets, deferred outflows of resources, liabilities, and
deferred inflows of resources, with the difference between the four reported as net position. Over time, increases or
decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or
deteriorating.
The Statement of Activities presents information showing how the City's net position changed during the fiscal year. All
changes in net position are reported when the underlying event giving rise to the change occurs, regardless of the timing of
related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash
flows in the future fiscal periods (e.g., uncollected taxes and earned but unused compensated absences).
Both of the government -wide financial statements distinguish functions of the City that are principally supported by taxes
and intergovernmental revenues (governmental activities) from functions that are intended to recover all or a significant
portion of their costs through user fees and charges (business -type activities). The governmental activities of the City include
general government, public safety, public works, community services, parks and recreation, economic development, and
intergovernmental. The business -type activities of the City include water, sewer, and solid waste.
7 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
The government -wide financial statements can be found on pages 17 through 19 of this report. The government -wide
financial statements include not only the City, itself (known as the primary government), but also legally separate entities for
which the City is financially accountable. These entities include the Pearland Economic Development Corporation, the
Development Authority of Pearland, and the Tax Increment Reinvestment Zone #2. Financial information for these blended
component units is reported together with the financial information presented for the primary government.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over resources that have
been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to
ensure and demonstrate compliance with finance -related legal requirements. All funds of the City can be divided into two
categories — governmental funds and proprietary funds.
Governmental Funds. Governmental funds are used to account for essentially the same functions reported as governmental
activities in the government -wide financial statements. However, unlike the government -wide financial statements,
governmental fund financial statement focus on current sources and uses of spendable resources, as well as on balances of
spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's
near -term financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to
compare the information presented for governmental funds with similar information presented for governmental activities
in the government -wide financial statements. By doing so, readers may better understand the long-term impact of the
government's near -term financing decisions. Both the governmental funds balance sheet and the governmental fund
statements of revenues, expenditures, and changes in fund balance provide a reconciliation to facilitate this comparison
between governmental funds and governmental activities.
Beginning on page 20 of this report, information is presented separately in the Governmental Funds Balance Sheet and in the
Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances for the General, Debt Service,
Capital Projects, Pearland Economic Development Corporation, Tax Increment Reinvestment Zone #2, and Development
Authority of Pearland, which are considered to be major funds. Data from the non -major governmental funds are combined
into a single, aggregated presentation. Individual fund data for each of these non -major governmental funds is provided in
the form of combining statements elsewhere in this report.
Proprietary Funds. The City maintains two types of proprietary funds. Enterprise Funds are used to report the same functions
presented as business -type activities in the government -wide financial statements. The City uses enterprise funds to account
for its Water and Sewer Fund and Solid Waste Fund. Additionally, the City maintains an Internal Service Fund to account for
the financing of goods or services provided by one department or agency to other departments or agencies of the City on a
cost reimbursement basis. The internal service funds are included in governmental activities for government -wide reporting
purposes.
Proprietary funds provide the same type of information as the government -wide financial statements, only in more detail.
The basic proprietary fund financial statements, which begin on page 28 of this report, provide separate information for the
Water and Sewer Fund, which is considered to be a major fund, and the Solid Waste Enterprise Fund, the only nonmajor
enterprise fund. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary
fund financial statements. Individual fund data for the internal service funds are provided in the form of combining
statements in the combining and individual fund statements and schedules section of this report. The basic proprietary fund
financial statements can be found on pages 28 through 33 of this report.
Notes to the Financial Statements. The notes provide additional information that is essential to a full understanding of the
data provided in the government -wide and fund financial statements. The notes to the financial statements can be found
beginning on page 35 of this report.
8 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Other Information. In addition to the basic financial statements and accompanying notes, this report also presents required
supplementary information. The City presents budgetary comparison schedules for the General Fund and the Pearland
Economic Development Corporation; and the City's progress in funding its obligations to provide pension and OPEB benefits
to its employees. Required supplementary information can be found immediately after the notes to the financial statements
beginning on page 79.
The combining and individual fund statements and schedules referred to earlier in connection with non -major governmental
funds and internal service funds are presented immediately following the required supplementary information on budgetary
comparisons, and pensions and OPEB. Combining and individual fund statements and schedules can be found beginning on
page 94 of this report.
Government -wide Overall Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the
City, assets and deferred outflows of resources exceeded liabilities by $1,029.0 million at the close of the most recent fiscal
year. By far the largest portion of the City's net position (72%) reflects its investment in capital assets, less any related debt
used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens;
consequently, these assets are not available for future spending. Although the City's investment in its capital assets is
reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
Comparative Statement of Net Position
September 30, 2025 and 2024
Assets and
Deferred Outflows
Assets:
Current
Capital assets *
Total assets
Deferred outflows
Total Assets and
Deferred Outflows
Liabilities and
Deferred Inflows
Liabilities:
Current
Long-term
Total liabilities
Deferred inflows
Total Liabilities and
Deferred Inflows
Net Position
Net investment in
capital assets *
Restricted
Unrestricted
Total Net Position
Governmental Activities
2025 2024
$ 283,768,509
962,608,425
1,246,376,934
14,716,001
1,261,092,935
24,142, 640
512,521,652
536,664,292
7,097,543
543,761,835
$ 289,303,118
954,874,710
1,244,177,828
19, 293,114
Net Position
Business -type Activities
2025 2024
$ 298,262,348
684,937,995
983,200,343
2,217,078
1,263,470,942 985,417,421
25, 674,098
530,316,736
555,990,834
5,055,399
561,046,233
33,807,766
639,248,874
673,056,640
711,911
673,768,551
$ 241,443,280
647,945,580
889, 388,860
2,830,485
892,219,345
Totals
2025 2024
$ 582,030,857
1,647,546,420
2, 229, 577, 277
16,933,079
2,246,510,356
$ 530,746,398
1,602,820,290
2,133,566,688
22,123, 599
2,155, 690,287
40,900,802 57,950,406 66,574,900
545, 586,105 1,151, 770, 526 1, 075, 902,841
586,486, 907 1, 209, 720, 932 1,142,477,741
435,043 7,809,454 5,490,442
586, 921,950 1, 217, 530, 386 1,147, 968,183
607,400,872 581,482,026 134,048,213 244,995,292 741,449,085 826,477,318
95,526,295 89,753,944 22,096,469 30,316,807 117,622,764 120,070,751
14,403,933 31,188,739 155,504,188 29,985,296 169,908,121 61,174,035
$ 717,331,100 $ 702,424,709 $ 311,648,870 $ 305,297,395 $ 1,028,979,970 $ 1,007,722,104
9 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Comparative Statement of Activities
Year Ended September 30, 2025 and 2024
Governmental Activities
2025 2024
Changes in Net Position
Business -type Activities
2025 2024
Totals
2025 2024
Revenues
Program Revenues:
Charges for services $ 33,846,118 $ 33,014,891 $ 90,730,416 $ 83,670,189 $ 124,576,534 $ 116,685,080
Operating grants and
contributions 3,091,882 1,360,765 - - 3,091,882 1,360,765
General Revenues:
Property taxes 125,323,996 124,388,106 - - 125,323,996 124,388,106
Sales and use taxes 49,905,163 48,234,929 4,012 3,876 49,909,175 48,238,805
Franchise taxes 7,501,663 7,216,855 - - 7,501,663 7,216,855
Investment earnings 12,766,009 12,867,621 8,276,227 7,328,169 21,042,236 20,195,790
Gain on sale
of capital assets 775,918 26,362 - - 775,918 26,362
Miscellaneous 2,709,090 2,371,228 489,610 123,566 3,198,700 2,494,794
Total Revenues 235,919,839 229,480,757 99,500,265 91,125,800 335,420,104 320,606,557
Expenses
General government 28,273,497 27,354,920 - - 28,273,497 27,354,920
Public safety 82,610,886 73,557,177 - - 82,610,886 73,557,177
Public works 59,751,069 56,711,098 - - 59,751,069 56,711,098
Community services 5,936,831 5,233,856 - - 5,936,831 5,233,856
Park and Recreation 14,019,659 11,800,047 - - 14,019,659 11,800,047
Economic Development 18,864,156 19,773,477 - - 18,864,156 19,773,477
Intergovernmental 4,043,397 4,097,319 - - 4,043,397 4,097,319
Interest on debt 15,068,336 13,128,593 - - 15,068,336 13,128,593
Water and sewer - - 77,066,586 65,977,019 77,066,586 65,977,019
Solid waste - - 8,527,821 8,187,340 8,527,821 8,187,340
Total Expenses 228,567,831 211,656,487 85,594,407 74,164,359 314,162,238 285,820,846
Change in Net Position
Before Transfers 7,352,008 17,824,270 13,905,858 16,961,441 21,257,866 34,785,711
Transfers 7,554,383 4,759,566 (7,554,383) (4,759,566) - -
Change in Net Position 14,906,391 22,583,836 6,351,475 12,201,875 21,257,866 34,785,711
Net Position, Beginning* 702,424,709 679,840,873 305,297,395 293,095,520 1,007,722,104 972,936,393
Net Position - Ending $ 717,331,100 $ 702,424,709 $ 311,648,870 $ 305,297,395 $ 1,028,979,970 $ 1,007,722,104
The City's overall net position increased by $21.3 million from the prior fiscal year. The reasons for this change are discussed
in the following sections for governmental activities and business -type activities.
Governmental Activities. Governmental activities net position increased by $14.9 million, from a beginning net position of
$702.4 million to an ending net position of $717.3 million. Key elements of this change are as follows.
• Property taxes increased by $0.9 million when compared to the previous year despite a half cent reduction in the
overall tax rate. This was due to new properties being added to the roll, an increase in appraised values, and a shift
of tax allocations from debt service to maintenance and operations.
• Sales taxes increased by $1.7 million when compared to the previous year.
• Investment earnings decreased by $0.1 million.
• Total expenses increased by $16.9 million from the previous fiscal year.
10 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Business -type Activities. Business -type activities net position increased by $6.4 million, from a restated net position of $305.3
million to an ending net position of $311.6 million. Key elements of this change are as follows
• Charges for services increased by $7.1 million due to a 7% increase in rates in addition to approximately 1.1%
increase in connections.
• Investment earnings increased by $0.9 million.
• Total expenses increased by $11.4 million from the previous fiscal year.
Financial Analysis of Governmental Funds
As noted earlier, fund accounting is used to demonstrate and ensure compliance with finance -related legal requirements.
Governmental Funds. The focus of the City's governmental funds is to provide information of near -term inflows, outflows,
and balances of spendable resources. Such information is useful in assessing the City's financing requirements. In particular,
unassigned fund balance may serve as a useful measure of the City's net resources available for spending at the end of the
fiscal year.
The City's governmental funds reflect a combined fund balance of $226.3 million. Of this amount, $28.5 million is unassigned
and available for day-to-day operations of the City; $55,601 is nonspendable; $192.1 million is restricted; $4.3 million is
committed by City Council; and $1.3 million is assigned by management.
Analysis of Individual Funds
The general fund is the chief operating fund of the City. At the end of the current fiscal year, unassigned fund balance of the
general fund was $36.6 million, while total fund balance increased by $1.6 million to an ending balance of $36.6 million. This
was due to an increase in appraised values coupled an increase in the M&O tax rate from $0.3325 to $0.3350. As a measure
of the general fund's liquidity, it may be useful to compare both unassigned fund balance to total general fund expenditures.
Unassigned fund balance represents 31% of total general fund expenditures.
The fund balance of the City's debt service fund decreased by $1.4 million during the current fiscal year to an ending fund
balance of $4.2 million. This activity in this fund varies based on the amount of debt outstanding each year.
The fund balance of the City's capital projects fund decreased by $11.8 million during the current fiscal year to an ending fund
balance of $102.1 million. This change was due to the issuance of $28.8 million in debt, plus premiums of $0.7 million, less
reductions for the continued spending on bond projects.
The fund balance of the Pearland Economic Development Corporation increased by $7.5 million during the current fiscal year
to an ending fund balance of $47.0 million. This change was due to sales tax revenues exceeding the amounts expended or
transferred for economic development.
The fund balance of the Tax Increment Reinvestment Zone #2 decreased by $0.5 million during the current fiscal year to an
ending fund balance of $8.4 million. This change was due to economic development expenditures, plus amounts required to
be transferred to the Development Authority of Pearland, exceeding property tax revenues in the Tax Increment
Reinvestment Zone #2.
The fund balance of the Development Authority of Pearland increased by $0.6 million during the current fiscal year to an
ending fund balance of $19.2 million. This change was due to the transfers from other funds exceeding the required debt
service payments and reimbursements to developers.
11 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Proprietary Funds. The City's proprietary funds provide the same type of information found in the government -wide financial
statements, but in more detail. The City's business -type activities primarily consist of services provided by the water and
sewer fund.
The net position of the water and sewer fund increased by $5.7 million during the current fiscal year to an ending net position
of $304.2 million. This change was due to a 7% increase in rates in addition to approximately 1.1% increase in connections,
which was offset by increasing costs to operate the utility department.
General Fund Budgetary Highlights
Original budget compared to final budget. During the year, there was an increase of $3.8 million in appropriations between
the adopted and amended budget which is only a 3.2% amendment to total adopted expenditures.
Final budget compared to actual results. Actual revenues of $121.2 million were more than final budgeted amounts by $1.0
million due to more than anticipated revenues generated from various charges for services. Actual expenditures of $119.3
million were less than final budgeted amounts by $1.6 million primarily due to less than anticipated public works
expenditures.
Capital Assets and Debt Administration
Capital Assets. At the end of fiscal year 2025, the City's governmental activities and business -type activities had invested
$962.6 million and $684.9 million, respectively, in a variety of capital assets and infrastructure, as reflected in the following
schedule. This represents a net increase of an increase of $7.7 million over the end of last fiscal year for the governmental
activities and an increase of $37.0 million over the end of last fiscal year for business -type activities.
Land
Construction in progress
Infrastructure
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Contractual water rights
Lease assets
SBITA assets
Total Capital Assets
Capital Assets
Governmental Activities Business -type Activities Totals
2025 2024 2025 2024 2025 2024
$ 52,390,338 $ 51,483,358 $ 10,343,706 $ 10,343,706 $ 62,734,044 $ 61,827,064
98,264,118 76,152,606 80,823,222 321,025,929 179,087,340 397,178,535
614,235,234 627,130,369 563,067,598 283,900,441 1,177,302,832 911,030,810
157,510,462 156,894,279 19,620,156 20,006,276 177,130,618 176,900,555
11,859,798 13,944,288 359,087 573,353 12,218,885 14,517,641
24,624,600 24,710,519 14,201 10,781 24,638,801 24,721,300
- - 10,710,025 12,085,094 10,710,025 12,085,094
- 144,863 - - - 144,863
3,723,875 4,414,428 - - 3,723,875 4,414,428
$ 962,608,425 $ 954,874,710 $ 684,937,995 $ 647,945,580 $ 1,647,546,420 $ 1,602,820,290
Construction in progress at year-end represents numerous ongoing projects, the largest of which relate to streets, drainage,
and water/sewer projects. City's capital assets can be found in Note 4 to the financial statements.
12 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
Long -Term Debt. At the end of the current fiscal year, the City had total outstanding debt of $479.0 million in the
governmental activities and $634.9 million in the business -type activities.
Outstanding Debt
Governmental Activities Business -type Activities Totals
2025 2024 2025 2024 2025 2024
General obligation bonds $ 269,155,000 $ 271,525,000 $ - $ 1,245,000 $ 269,155,000 $ 272,770,000
Certificates of obligation 121,255,000 120,000,000 289,350,000 176,565,000 410,605,000 296,565,000
Revenue bonds 46,590,000 57,620,000 325,025,000 344,190,000 371,615,000 401,810,000
Unamortized premium 23,108,723 27,558,856 19,039,065 17,668,426 42,147,788 45,227,282
Leases - 148,819 - - - 148,819
Financed purchases 936,473 1,218,141 - - 936,473 1,218,141
SBITAs 3,905,430 4,494,536 - - 3,905,430 4,494,536
Compensated absences 14,041,052 10,162,217 1,497,199 900,841 15,538,251 11,063,058
Total Outstanding Debt $ 478,991,678 $ 492,727,569 $ 634,911,264 $ 540,569,267 $ 1,113,902,942 $ 1,033,296,836
The City's outstanding debt for governmental activities decreased by $13.7 million due to scheduled principal payments,
offset by issuance of $63.4 million in bonds. The City's debt for business -type activities increased by $94.3 million from the
previous year due to scheduled principal payments, offset by issuance of $115.5 million in bonds. Current credit ratings on
debt issues are as follows:
General obligation bonds
Certificates of obligation
Revenue bonds
S&P Fitch Moody's
AA AA+ A2
AA AA+ Aa2
N/A A A3
Both the Pearland Economic Development Corporation (PEDC) and the Development Authority of Pearland (DAP), component
units of the City, have outstanding debt. The PEDC bonds are rated Al from Moody's. The DAP bonds are rated A- by Standard
and Poor's. Additional information on the City's long-term debt can be found in Note 5 to the financial statements.
Economic Factors and Next Year's Budget and Rates
Pearland, Texas, is experiencing robust economic growth with significant development in healthcare, education, retail, and
technology sectors. The city's healthcare industry is booming with numerous expansions to meet the needs of its growing
population. Pearland's local businesses and educational institutions further bolster its strong job market. As the fastest -
growing city in the region, Pearland offers everything needed for business success, including affordable housing, outstanding
schools, safe neighborhoods, and a superb quality of life. With millions of square feet of retail, office, and residential
construction completed in the past decade, Pearland is on its way to becoming the next major employment center.
In fiscal year 2025, Pearland projects strong sales tax revenue of $30.8 million, a 1.7% increase from fiscal year 2024. The city
received positive bond ratings from Moody's and Fitch for its 2024 issuances, reflecting a stable financial outlook. The City's
Permanent Improvement Bonds Series 2024 for $36.9 million, and the City's Certificates of Obligation Series 2024A and 2024C
for $25.4 million and $81.3 million, respectively, were assigned a rating of 'AA+' by Fitch and 'AA' by Moody's.
Additionally, Pearland is investing in Internal Service Funds to stabilize tax rates and avoid capital outlay "spikes." The city
plans for conservative sales tax growth of 1.7% and continued strong property values, expected to rise by upwards of 9.9%.
Pearland's close proximity to cultural amenities, professional sports, and recreational opportunities enhances its appeal. The
city continues to invest in Internal Service Funds to assist with operating expenses moving forward, helping residents and
businesses by stabilizing the tax rate. This initiative aims to avoid capital outlay "spikes" in tax rates.
Requests for Information
The financial report is designed to provide our citizens, customers, investors and creditors with a general overview of City's
finances. If you have questions about this report or need any additional financial information, contact the Director of Finance
at 3523 Liberty Drive, Pearland, Texas 77581, or 281-652-1698. The report and general information can be found on the City's
website at www.pearlandtx.gov.
13 City of Pearland, Texas 2025 ACFR
14 City of Pearland, Texas 2025 ACFR
BASIC FINANCIAL STATEMENTS
15 City of Pearland, Texas 2025 ACFR
16 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF NET POSITION
September 30, 2025
Primary Government
Governmental Business -type
Activities Activities Total
Assets
Cash and equivalents
Investments
Receivables, net of allowance
for uncollectibles
Internal balances
Inventories
Prepaid items
Restricted cash and cash equivalents
Capital Assets:
Nondepreciable
Depreciable, net
Total Capital Assets
Total Assets
Deferred Outflows of Resources
Deferred charge on refunding
Pension related
OPEB related
Total Deferred Outflows of Resources
Liabilities
Accounts payable
Accrued liabilities
Accrued interest
Unearned revenues
Customer deposits
Long-term liabilities:
Due within one year: Bonds, leases,
financed purchases, compensated absences
Due in more than one year:
Bonds, leases, financed purchases,
compensated absences
Net pension liability
Total OPEB liability
Total Liabilities
Deferred Inflows of Resources
Lease related
Pension related
OPEB related
Total Deferred Inflows of Resources
Net Position
Net investment in capital assets
Restricted for:
Capital improvements
Debt service
Tourism
Community development programs
Grants
Public safety
Economic development
Unrestricted
Total Net Position
$ 163,329,334 $ 125,010,004 $ 288,339,338
19,955,193 35,088,003 55,043,196
$
28,980,510 12,810,783 41,791,293
(7,693,279) 7,693,279
754,350 754,350
60,125 60,125
78,382,276 117,660,279 196,042,555
150,654,456 91,166,928 241,821,384
811,953,969 593,771,067 1,405,725,036
962,608,425 684,937,995 1,647,546,420
1,246,376,934 983,200,343 2,229,577,277
1,818,820 548,632 2,367,452
12,246,906 1,584,323 13,831,229
650,275 84,123 734,398
14,716,001 2,217,078 16,933,079
11,628,484 16,670,636 28,299,120
7,836, 038 11,176,165 19,012, 203
1,817,078 1,709,294 3,526,372
2,321,621 2,321,621
539,419 4,251,671 4,791,090
43,303,315 43,185,000 86,488,315
435,688,363 591,726,264 1,027,414,627
27,301,658 3,531,883 30,833,541
6,228,316 805,727 7,034,043
536,664,292 673,056,640 1,209,720,932
1,594,428 1,594,428
3,229,432 417,776 3,647,208
2,273,683 294,135 2,567,818
7,097,543 711,911 7,809,454
607,400,872
5,741,634
9,236,516
4,703,364
105,361
663,493
75,075,927
14,403,933
717,331,100
$
134,048,213 741,449,085
9,247,447 9,247,447
12, 849, 022 18, 590, 656
9,236,516
4,703,364
105,361
663,493
75,075,927
155,504,188 169, 908,121
311,648,870 $ 1,028,979,970
See notes to the financial statements.
17 City of Pearland, Texas 2025 ACFR
18 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF ACTIVITIES
Year Ended September 30, 2025
Functions/Programs
Primary Government
Governmental Activities:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Intergovernmental
Interest on long-term debt
Total Governmental Activities
Business -Type activities:
Water and sewer
Solid waste
Total Business -Type Activities
Total Primary Government
Expenses
Program Revenue
Operating
Charges for Grants and
Services Contributions
$ 28,273,497 $ 15,271,978 $ 891,412
82,610,886 11,078,836
59,751,069 327,195 2,191,470
5,936,831 5,219,424 -
14,019,659 2,196,222 -
18,864,156 (247,537) 9,000
4,043,397
15,068,336
228,567,831 33,846,118 3,091,882
77,066,586 82,265,983
8,527,821 8,464,433
85,594,407 90,730,416
$ 314,162,238 $ 124,576,534 $ 3,091,882
General Revenues:
Taxes:
Property taxes
Sales and use taxes
Franchise taxes
Unrestricted investment earnings
Gain on sale of assets
Miscellaneous
Transfers
Total General Revenues and Transfers
Change in net position
Net Position - Beginning, as Previously Reported
Restatements
Net Position - Beginning
Net Position - Ending
See notes to the financial statements.
$
$
Net (Expense) Revenue and Changes in Net Position
Primary Government
Governmental
Activities
(12,110,107)
(71,532,050)
(57,232,404)
(717,407)
(11,823,437)
(19,102,693)
(4,043,397)
(15,068,336)
(191,629,831)
Business -type
Activities
$
5,199,397
(63,388)
5,136,009
(191,629,831) 5,136,009
$
Total
(12,110,107)
(71,532,050)
(57,232,404)
(717,407)
(11,823,437)
(19,102,693)
(4,043,397)
(15,068,336)
(191,629,831)
5,199,397
(63,388)
5,136,009
(186,493,822)
125,323,996 125,323,996
49,905,163 4,012 49,909,175
7,501,663 - 7,501,663
12,766,009 8,276,227 21,042,236
775,918 775,918
2,709,090 489,610 3,198,700
7,554,383 (7,554,383)
206,536,222 1,215,466 207,751,688
14,906,391 6,351,475 21,257,866
677,410,069 303,345,151 980,755,220
25,014,640 1,952,244 26,966,884
702,424,709 305,297,395 1,007,722,104
717,331,100 $ 311,648,870 $ 1,028,979,970
19 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
BALANCE SHEET - GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Investments
Receivables (net of allowance
for uncollectibles)
Lease receivable
Due from other funds
Prepaids
Inventories
Restricted cash and cash equivalents
Restricted investments
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Accrued interest
Deposits payable
Due to other funds
Unearned revenue
Total Liabilities
Deferred Inflows of Resources
Unavailable revenue
Lease related
Total Deferred Inflows of Resources
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
General Fund
$ 7,735,193 $
19,955,193
10,617,627
8,266,504
42,678
$ 46,617,195 $
$ 2,588,353 $
4,318,707
521,937
185,932
7,614,929
781,754
1,594,428
2,376,182
42,678
36,583,406
36,626,084
$ 46,617,195 $
Debt Service
Fund
4,121, 894
3,458,772
Capital Projects
Fund
$ 32,684,608
4,143,570
78,105,961
Page 1 of 2
Pearland
Economic
Development
Corporation
$ 44,836,970
8,951, 203
7,580,666 $ 114,934,139 $ 53,788,173
21,954 $
21,954
3,319,542
3,319,542
4,239,170
4,239,170
6,262,316
2,462,080
2,771
8,727,167
4,143,570
4,143,570
98,585,881
3,526,190
(48,669)
102,063,402
$ 265,351
173,175
438,526
6,311,182
6,311,182
47,038,465
47,038,465
7,580,666 $ 114,934,139 $ 53,788,173
See notes to the financial statements.
20 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
BALANCE SHEET - GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Investments
Receivables (net of allowance
for uncollectibles)
Lease receivable
Due from other funds
Prepaids
Inventories
Restricted cash and cash equivalents
Restricted investments
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Accrued interest
Deposits payable
Due to other funds
Unearned revenue
Total Liabilities
Deferred Inflows of Resources
Unavailable revenue
Lease related
Total Deferred Inflows of Resources
Tax Increment
Reinvestment
Zone #2
Development
Authority of
Pearland
Other
Governmental
Funds
Page 2 of 2
Total
Governmental
Funds
$ 8,373,362 $ 19,196,451 $ 18,545,537 $ 135,494,015
56,145
708
- 19,955,193
1,531,161
12,923
28,759,186
8,266,504
55,601
78,105, 961
$ 8,429,507 $ 19,197,159 $ 20,089,621 $ 270,636,460
$ 21,123 $
42,109
63,232
$ 669,573 $
297,649
8,266,504
2,135, 689
11,369,415
Fund Balances
Nonspendable - 12,923
Restricted 8,366,275 19,197,159 14,708,734
Committed - 752,600
Assigned - 1,257,458
Unassigned - (8,011,509)
Total Fund Balances 8,366,275 19,197,159 8,720,206
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances $ 8,429,507 $ 19,197,159 $ 20,089,621 $ 270,636,460
9,828,670
7,293,720
524,708
8,266,504
2,321,621
28,235,223
14,556,048
1,594,428
16,150,476
55,601
192,135, 684
4,278,790
1,257,458
28,523,228
226,250,761
See notes to the financial statements.
21 City of Pearland, Texas 2025 ACFR
22 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
September 30, 2025
Total Fund Balance, Governmental Funds
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and, therefore, are not
reported in the funds.
Capital assets
Accumulated depreciation/amortization
Differences between expected and actual experiences, assumption changes and net differences
between projected and actual earnings and contributions subsequent to the measurement date for the
postretirement benefits (pension and OPEB) are recognized as deferred outflows of resources and
deferred inflows of resources on the statement of net position.
Deferred outflows - pension related
Deferred outflows - OPEB related
Deferred inflows - pension related
Deferred inflows - OPEB related
Other long-term assets (property taxes receivable and adjudicated court fines receivable) are not
available to pay current period expenditures and, therefore, are either deferred or not reported in the
funds.
Property taxes receivable
UHCL financing receivable
Street assessments
PEDC receivable
Intergovernmental receivables
Long-term liabilities that are not due and payable in the current period, and therefore, are not reported
in the funds.
Bonds payable
Financed purchases payable
Compensated absences
Net pension liability
Total OPEB liability
Accrued interest payable on long-term debt
Governmental funds report the effect of premiums, discounts, and refundings and similar items when
debt is first issued, whereas these amounts are deferred and amortized in the statement of activities.
Deferred amount on refunding
Premium on bonds
Internal service funds are used by management to charge the cost of property insurance and employee
benefits to individual funds. The assets and liabilities of the internal service funds are included in the
governmental activities in the statement of net position.
Net Position of Governmental Activities in the Statement of Net Position
$ 226,250,761
1,722,603,576
(771,200,221)
951,403,355
12,155,147
645,403
(3,205,236)
(2,256,647)
7,338,667
1,692,811
2,408,485
7,311,182
3,143, 570
14,556,048
(437,000,000)
(936,473)
(13, 278, 214)
(27,097,103)
(6,181,651)
(1,568,694)
(486,062,135)
1,818,820
(23,108,723)
(21,289,903)
25,134, 307
$ 717,331,100
See notes to the financial statements. 23
City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - GOVERNMENTAL FUNDS
Year Ended September 30, 2025
Revenues
Property taxes
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Debt Service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Issuance of debt - bonds
Premium on bonds issued
Payment to refunded bond escrow agent
Sale of general capital assets
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
General Fund
Debt Service
Fund
$ 43,218,171 $ 38,447,756
32,208,512
7,339,412
4,233,596
2,257,800
26,357,807
3,688,619
1,418,744
471,327
$ 121,193,988
13,324,859
77,017,633
12,395,001
5,282,856
9,743,621
281,668
71,709
1,137,870
119,255,217
1,938,771
Capital Projects
Fund
$
Page 1 of 2
Pearland
Economic
Development
Corporation
$
15,888,222
77,805 5,330,522 1,805,335
1,428,510 2,191,470 9,000
667,635 289,234 113,110
$ 40,621,706 $ 7,811,226 $ 17,815,667
40,005,000
16,171,084
1,078,017
3,786,531
61,040,632
1,000,000
432,229
51,440,485
52,872,714
(20,418,926) (45,061,488)
6,995,692 19,362,029
(7,641,263)
308,280
(337,291)
1,601,480
35,024,604
$ 36,626,084 $
23,550,000
1,200,598
(25,141,729)
18,970,898
(1,448,028)
5,687,198
4,239,170 $
6,400, 801
(2,651,133)
28,805,000
702,828
3,538,241
250,000
11,800
827,980
4,628,021
13,187, 646
(5,959,201)
247,537
33,257,496 (5,711,664)
(11,803,992) 7,475,982
113,867,394 39,562,483
102,063,402 $ 47,038,465
See notes to the financial statements.
24 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - GOVERNMENTAL FUNDS
Year Ended September 30, 2025
Revenues
Property taxes
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Debt Service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Issuance of debt - bonds
Premium on bonds issued
Payment to refunded bond escrow agent
Sale of general capital assets
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Tax Increment
Reinvestment
Zone #2
$ 43,942,469 $
439,408
$ 44,381,877 $
15,214,875
15,214,875
29,167,002
(29,709,430)
(29,709,430)
Development
Authority of
Pearland
Other
Governmental
Funds
$
45,742
45,742 $
1,808,429
162,251
593,738
135,490
515,224
639,330
3,201,048
776,885
7,832,395
Page 2 of 2
Total
Governmental
Funds
$ 125,608,396
49, 905,163
7,501,663
4,827,334
2,393,290
26,873,031
12,026,761
8,248,772
2,318,191
$ 239,702,601
710,042 14,034,901
347,211 77,364,844
2,120,939 15,515,940
143,907 5,426,763
1,282,637 11,026,258
1,500 18,754,616
10,780,000 85,251 51,401,919
1,664,744 208 17,919,545
4,900 - 1,515,146
6,099,424 59,505,759
256,866 4,043,397
12,451,144 11,046,485 276,509,088
(12,405,402) (3,214,090) (36,806,487)
29,709,430 4,099,626 66,567,578
(16,750,302) (655,592) (63,366,921)
52,355,000
1,903,426
(25,141,729)
555,817
12,959,128 3,444,034 32,873,171
(542,428) 553,726 229,944 (3,933,316)
8,908,703
$ 8,366,275
18,643,433 8,490,262 230,184,077
$ 19,197,159 $ 8,720,206 $ 226,250,761
See notes to the financial statements.
25 City of Pearland, Texas 2025 ACFR
26 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS TO THE
GOVERNMENT -WIDE STATEMENT OF ACTIVITIES
Year Ended September 30, 2025
Net Change in Fund Balances - Total Governmental Funds: $ (3,933,316)
Amounts reported for Governmental Activities in the Statement of Activities are different because:
Governmental funds report outlays for capital assets as expenditures. However, in the Statement of Activities, the
cost of these assets is allocated over their estimated useful lives as depreciation expense.
Capital outlay
Depreciation/amortization expense
The repayment of the principal of long-term debt consumes the current financial resources of governmental funds.
The transaction, however, does not have any effect on net position. Also, governmental funds report the effect of
bond premiums, discounts and similar items when debt is first issued, whereas the amounts are deferred and
amortized in the statement of activities.
Issuance of debt - bonds
Issuance of debt - premium on bonds
Principal paid - bonds
Principal paid - leases
Principal paid - financing agreement
Defeasance - bonds
Payment to escrow agent - bond refunding
Revenues in the statement of activities that do not provide current financial resources are not reported as revenues
in the funds.
Property taxes receivable
UHCL financing receivable
Economic development agreement receivables
Intergovernmental receivables
Some expenses reported in the Statement of Activities do not require the use of current financial resources and,
therefore, are not reported as expenditures in governmental funds:
Accrued interest on long-term debt
Amortization of bond premiums/discounts and deferred amounts of refunding
Compensated absences
Loss on MUD annexation
Changes in pension liabilities and related deferred outflows and inflows of resources
Changes in OPEB liabilities and related deferred outflows and inflows of resources
An internal service fund is used by management to charge the cost of certain activities, such
as insurance and fleet management, to individual funds. A portion of the change in net position of the internal
service funds is included in governmental activities in the statement
of activities.
Change in Net Position of Governmental Activities
59,505,759
(53,900,098)
5,605,661
(52,355,000)
(1,903,426)
38,400,000
85,251
281,668
12,635,000
25,141,729
22,285,222
(284,400)
(667,636)
(247,537)
(2,569,808)
(3,769,381)
(209,515)
4,722,163
(3,523,376)
(7,066,432)
(1,403,775)
(291,590)
(7,772,525)
2,490,730
$ 14,906,391
27 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
September 30, 2025
Assets
Current assets:
Cash and cash equivalents
Investments
Receivables, net
Prepaids
Inventories
Restricted cash and cash equivalents
Total current assets
Noncurrent assets:
Capital assets:
Land and improvements
Construction in progress
Contractual rights to water supply
Infrastructure
Buildings
Machinery and equipment
Right -to -use software
Less accumulated
depreciation/amortization
Total noncurrent assets
Total Assets
Deferred Outflows of Resources
Deferred charge on refunding
Pension related
OPEB related
Total Deferred Outflows of Resources
Business -type Activities
Water and
Sewer Fund
$ 125,111,265
35,088,003
12,125,699
$
117,660,279
289,985,246
10, 343, 706
80,823,222
34,511,428
788,129,122
32,157,965
5,440, 251
(266,467,699)
684,937,995
974,923,241
Page 1 of 2
Governmental
Activities
Solid Waste Total Enterprise Internal Service
Fund Funds Funds
$ (101,261) $ 125,010,004 $ 27,835,319
35,088,003 -
685,084 12,810,783 221,324
4,524
- - 754,350
- 117,660,279 276,315
583,823 290,569,069 29,091,832
548,632
1,584,323
84,123
2,217,078 $
583,823
$
10,343,706
80,823,222
34,511,428
788,129,122
32,157,965
5,440,251
(266,467,699)
684,937,995
975,507,064
548,632
1,584,323
84,123
2,217,078 $
16,823,638
10,103,108
(15,721,676)
11,205,070
40,296,902
91,759
4,872
96,631
28 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
September 30, 2025
Liabilities
Current liabilities:
Accounts payable
Accrued liabilities
Accrued interest
Customer deposits
Current portion of noncurrent liabilities:
SBITA payable
Bonds payable
Total current liabilities:
Noncurrent liabilities:
Compensated absences
SBITA payable
Bonds payable
Net pension liability
Total OPEB liability
Total noncurrent liabilities:
Total Liabilities
Deferred Inflows of Resources
Pension related
OPEB related
Total Deferred Inflows of Resources
Net Position
Net investment in capital assets
Debt service
Capital improvements
Unrestricted
Total Net Position
Business -type Activities
Page 2 of 2
Governmental
Activities
Water and Solid Waste Total Enterprise Internal Service
Sewer Fund Fund Funds Funds
$ 16,656,469 $ 14,167 $ 16,670,636 $ 1,799,814
10,407,539 768,626 11,176,165 542,318
1,709,294 - 1,709,294 248,384
4,251,671 - 4,251,671 14,711
- - 2,007,836
43,185,000 - 43,185,000 -
76,209,973 782,793 76,992,766 4,613,063
1,497,199 - 1,497,199 762,838
- - 1,897,594
590,229,065 - 590,229,065 -
3,531,883 - 3,531,883 204,555
805,727 - 805,727 46,665
596,063,874 - 596,063,874 2,911,652
672,273,847 782,793 673,056,640 7,524,715
417,776 - 417,776 24,196
294,135 - 294,135 17,036
711,911 - 711,911 41,232
252,027,176 - 252,027,176 7,299,640
12,849,022 - 12,849,022 -
9,247,447 - 9,247,447 -
30,030,916 (198,970) 29,831,946 25,527,946
$ 304,154,561 $ (198,970) 303,955,591 $ 32,827,586
Adjustment to reflect the consolidation of
Internal service fund activities related to enterprise funds
Net Position of Business -Type Activities
7,693,279
$ 311,648,870
29 City of Pearland, Texas 2025 ACFR
30 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
PROPRIETARY FUNDS
Year Ended September 30, 2025
Business -type Activities
Water and Sewer Total Enterprise
Fund Solid Waste Fund Funds
Governmental
Activities
Internal Service
Funds
Operating Revenues
Charges for services:
Metered water sales $ 73,249,604 $ - $ 73,249,604 $ -
Impact fees 7,224,351 - 7,224,351 -
Solid waste fees - 8,464,433 8,464,433 -
Other utility fees and charges 1,792,028 1,792,028 -
Risk management - - - 11,272,633
Equipment management - - 24,571,146
Sales and use taxes - 4,012 4,012 -
Miscellaneous 489,610 - 489,610 1,058,535
Total Operating Revenues 82,755,593 8,468,445 91,224,038 36,902,314
Operating Expenses
Personnel services 12,934,645 12,934,645 4,672,101
Supplies and materials 9,043,330 9,043,330 85,632
Buildings and grounds 199,869 - 199,869 1,169,359
Repairs and Maintenance 3,563,047 - 3,563,047 5,683,996
Contractual Services 15,869,904 8,527,821 24,397,725 17,375,479
Miscellaneous 61,976 61,976 4,355,521
Depreciation and amortization 20,291,392 20,291,392 5,492,984
Total Operating Expenses 61,964,163 8,527,821 70,491,984 38,835,072
Operating Income (Loss) 20,791,430 (59,376) 20,732,054 (1,932,758)
Nonoperating Revenues (Expenses)
Investment earnings 8,264,457 11,770 8,276,227 739,248
Gain (loss) on disposal of property 220,101
Interest expense (15,845,717) (15,845,717) (146,293)
Total Nonoperating Revenues (Expenses) (7,581,260) 11,770 (7,569,490) 813,056
Income (Loss) Before Capital
Contributions and Transfers 13,210,170 (47,606) 13,162,564 (1,119,702)
Transfers in 96,812,823 - 96,812,823 4,353,726
Transfers out (104,367,206) - (104,367,206)
Change in Net Position 5,655,787 (47,606) 5,608,181 3,234,024
Net Position - Beginning, as Previously Reported 296,546,530 (151,364) 296,395,166 29,593,562
Restatements 1,952,244 - 1,952,244
Net Position (Deficit) - Beginning, as Restated 298,498,774 (151,364) 298,347,410 29,593,562
Net Position (Deficit) - Ending $ 304,154,561 $ (198,970) $ 303,955,591 $ 32,827,586
Reconciliation to Government -wide Statement of Activities
Change in net position of enterprise funds $ 5,608,181
Adjustment for the net effect of the current year activity
between the internal service funds and enterprise funds 743,294
Change in Net Position of Business -Type Activities $ 6,351,475
See notes to the financial statements.
31 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended September 30, 2025
Cash Flows from Operating Activities
Receipts from customers and users
Receipts from interfund charges for services
Other receipts
Payments to employees for salaries and benefits
Payments to suppliers and service providers
Net Cash Provided (Used) by Operating Activities
Cash Flows from Noncapital Financing Activities
Transfers from other funds
Transfers to other funds
Net Cash Provided (Used) by Noncapital
Financing Activities
Cash Flows from Capital and Related Financing Activities
Acquisition and construction of capital assets
Proceeds from certificates of obligation
Payment of bond issuance costs
Principal paid on bonds
Principal payments on leases
Principal payments on SBITAs
Interest paid on capital related debt
Net cash Provided (Used) by Capital and
Related Financing Activities
Cash Flows from Investing Activities
Maturity (purchase) of investments
Interest on investments
Net Cash Provided (Used) by Investing Activities
Net Increase (Decrease) in Cash and Cash Equivalents
Beginning Cash and Cash Equivalents
Ending Cash and Cash Equivalents
Reconciliation to the Statement of Net Position -
Proprietary Funds
Unrestricted cash and cash equivalents
Restricted cash and cash equivalents
Business -type Activities
Water and Sewer
Fund
$
Solid Waste
Fund
Total Enterprise
Funds
Page 1 of 2
Governmental
Activities
Internal Service
Funds
82,431,147 $ 8,508,646 $ 90,939,793 $
489,610
(12,215,646)
(35,906,925)
34, 798,186
96,812,823
(104, 367, 206)
(7,554,383)
(57,283,807)
119,118,123
(1,072,123)
(23,105,000)
(16,206,602)
21,450,591
(35,088,003)
8,264,457
(26,823,546)
21,870,848
4,012
(9,196,311)
(683,653)
11,770
11,770
(671,883)
493,622
(12,215,646)
(45,103,236)
34,114,533
96,812,823
(104,367,206)
(7,554,383)
(57,283,807)
119,118,123
(1,072,123)
(23,105,000)
(16,206,602)
21,450,591
(35,088,003)
8,276,227
(26,811,776)
21,198,965
35,843,779
899,050
(4,290,241)
(27,954,419)
4,498,169
4,353,726
4,353,726
(3,382,369)
(63,568)
(589,106)
(146,293)
(4,181,336)
739,248
739,248
5,409,807
220,900,696 570,622 221,471,318 22,701,827
$ 242,771,544 $ (101,261) $ 242,670,283 $ 28,111,634
$ 125,111,265
117, 660, 279
$ 242,771,544
$ (101,261) $ 125,010,004
117,660,279
$ (101,261) $ 242,670,283
$ 27,835,319
276,315
$ 28,111,634
See notes to the financial statements.
32 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended September 30, 2025
Reconciliation of Operating Income (Loss) to Net
Cash Provided (Used) by Operating Activities
Operating income (loss)
Adjustment to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Depreciation and amortization expense
(Increase) decrease in assets
Accounts receivable, net
Prepaids
Inventories
Increase (decrease) in liabilities:
Accounts payable
Accrued liabilities
Customer deposits
Compensated absences
Net pension liability and related amounts
Total OPEB liability and related amounts
Net Cash Provided (Used) by Operating Activities
Business -type Activities
Page 2 of 2
Governmental
Activities
Water and Sewer Solid Waste Total Enterprise Internal Service
Fund Fund Funds Funds
$ 20,791,430 $ (59,376) $ 20,732,054 $ (1,932,758)
20,291,392
165,164
1,817
44,213
20,291,392 5,492,984
209,377 (159,485)
1,817 3,890
(99,066)
13,373,119 (686,003) 12,687,116 1,154,602
(20,614,584) 17,513 (20,597,071) (355,979)
70,849 - 70,849 12,121
596,358 - 596,358 355,459
115,060 - 115,060 19,990
7,581 - 7,581 6,411
$ 34,798,186 $ (683,653) $ 34,114,533 $ 4,498,169
Non -cash Capital and Related Financing Activities
Gain (loss) on disposition of capital assets $
$ - $
$ 220,101
See notes to the financial statements.
33 City of Pearland, Texas 2025 ACFR
34 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
Note 1— Summary of Significant Accounting Policies
The financial statements of the City of Pearland, Texas (the "City") have been prepared in conformity with accounting
principles generally accepted in the United States of America, as applied to government units (hereinafter referred to as
generally accepted accounting principles (GAAP)). The Governmental Accounting Standards Board (GASB) is the accepted
standard -setting body for establishing governmental accounting and financial reporting principles. The City's significant
accounting policies are described below.
A. Description of government -wide financial statements
The government -wide financial statements (i.e., the statement of net position and the statement of activities) report
information on all of the nonfiduciary activities of the primary government and its component units. All fiduciary activities
are reported only in the fund financial statements. Governmental activities, which normally are supported by taxes,
intergovernmental revenues, and other nonexchange transactions, are reported separately from business -type activities,
which rely to a significant extent on fees and charges to external customers for support. Likewise, the primary government is
reported separately from certain legally separate component units, if applicable, for which the primary government is
financially accountable.
B. Reporting Entity
The City was incorporated in December 1959 and adopted a "Home Rule Charter" on February 6, 1971. The Charter, as
amended, provides for a Council -Manager form of government and provides services authorized by its charter. Presently,
these services include police, fire and emergency medical, water and sewer services, drainage, sanitation, building and code
inspection, planning, zoning, engineering, street repair and maintenance, park maintenance, recreational activities for
citizens, and general administrative services. Fire protection is provided through a combination full-time part-time/volunteer
department. The City is governed by an elected mayor and seven -member Council. The Mayor and all members are elected
at large. The Mayor is allowed to vote only in case of a tie vote. The Mayor and each Council member hold office for a period
of three years and until his/her successor is elected and qualified. Council members shall be limited to two full consecutive
terms of office and there is no limitation on the office of the Mayor. The City Manager is appointed by Council and is
responsible for implementation of Council policy, execution of the laws, and all day-to-day operations of the City.
The City is an independent political subdivision of the State of Texas governed by an elected mayor and seven -member City
Council. The accompanying financial statements present the government and its component units, entities for which the
government is considered to be financially accountable. Blended component units are, in substance, part of the primary
government's operations, even though they are legally separate entities. Thus, the following blended component units are
appropriately presented as funds of the primary government:
Blended Component Unit - Pearland Economic Development Corporation (PEDC) - In 1995, the citizens of Pearland
established the Pearland Economic Development Corporation (PEDC) to help the citizens and public officials of Pearland
attract new businesses and to help existing businesses to expand. The mechanism to fund the operations of the corporation
is through a sales tax levy at a rate of one-half of one percent (1/2 percent). The PEDC is governed by a board appointed
by the City Council. Although it is legally separated from the City, the PEDC relies upon the primary government for
appointing the board, also City Council must approve the PEDC's budget and any debt issuances. The PEDC provides services
entirely, or almost entirely, to the City or otherwise exclusively, or almost exclusively, benefits the City even though it may
not provide services directly to it. PEDC is reported as a governmental fund and does not issue separate financial
statements.
35 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Blended Component Unit - Development Authority of Pearland (DAP) - In 2004, the City created the Development
Authority of Pearland to provide financing for the development of the TIRZ #2. Proceeds from bond sales are to be
used to reimburse developers and fund a debt service reserve. The Development Authority of Pearland is governed
by a board appointed by the City Council. Although it is legally separated from the City, the Development Authority
of Pearland is fiscally dependent upon the primary government because the City Council must also approve any debt
issuances done on behalf of the Development Authority of Pearland. The Development Authority of Pearland
provides services entirely, or almost entirely, to the City or otherwise exclusively, or almost exclusively, benefits the
City even though it may not provide services directly to it. DAP is reported as a governmental fund and does not
issue separate financial statements.
C. Basis of Presentation - Government -wide Financial Statements
While separate government -wide and fund financial statements are presented, they are interrelated. The governmental
activities column incorporates data from governmental funds and internal service funds, while business -type activities
incorporate data from the City's enterprise funds. Separate financial statements are provided for governmental funds,
proprietary funds, and fiduciary funds, even though the latter are excluded from the government -wide financial statements.
As a general rule, the effect of interfund activity has been eliminated from the government -wide financial statements.
Exceptions to this general rule are charges between the City's enterprise funds and governmental funds for various functions
of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various
functions concerned.
D. Basis of Presentation - Fund Financial Statements
The fund financial statements provide information about the City's funds, including its fiduciary funds and blended
component units. Separate statements for each fund category —governmental, proprietary, and fiduciary —are presented.
The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate
column. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds. Major individual
governmental and enterprise funds are reported as separate columns in the fund financial statements.
The City reports the following major governmental funds:
The General Fund is used to account for all financial transactions not properly includable in other funds. The principal
sources of revenues include local property taxes, sales and franchise taxes, licenses and permits, fines and forfeitures,
and charges for services. Expenditures include general government, public works, parks and recreation, community
services, and public safety.
The Debt Service Fund is used to account for the payment of interest and principal on all general obligation bonds and
other governmental long-term debt of the City. The primary source of revenue for debt service is local property taxes.
The Capital Projects Fund is used to account for the expenditures of resources accumulated on a pay-as-you-go basis and
the sale of bonds and related interest earnings for capital improvement projects.
The Pearland Economic Development Corporation, a blended component unit, is a special revenue fund used to account
for the revenues and expenditures associated with the half -cent sales tax for economic development approved by the
voters in 1995. Use of the funds are governed by State Law.
36 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The Tax Increment Reinvestment Zone #2 fund is a special revenue fund used to account for the incremental property
tax revenues in the specific geographical area and use thereof from the participating taxing entities in the Zone. In 1998,
the Tax Increment Reinvestment Zone (TIRZ #2) was established for a period of 30 years or until dissolved by the City.
The TIRZ #2 provides tax -assisted property development and/or redevelopment in specific geographic areas in
accordance with applicable state laws. The TIRZ #2 is governed by a board appointed by the City Council.
The Development Authority of Pearland fund, a blended component unit, is a special revenue fund used to account for
the financing of the development of the TIRZ #2.
The City reports the following major enterprise fund:
The Water and Sewer Fund is used to account for the operations that provide water and sewer utility services to the
public. The services are financed and operated in a manner similar to private business enterprises where the intent of
the governing body is that the costs (expenses including depreciation) of providing goods or services to the general public
on a continuing basis will be financed or recovered primarily through user charges.
Additionally, the City reports the following fund types:
Internal Service Funds used to account for the financing of goods or services provided by one department or agency to
other departments or agencies of the City on a cost -reimbursement basis. Services provided by the Internal Service Funds
include risk management, employee benefits, health claims, motor pool, facilities, information technology, and certain
capital -related leases. The Internal Service Funds are included in governmental activities for government -wide reporting
purposes.
During the course of operations the City has activity between funds for various purposes. Any residual balances outstanding
at year end are reported as due from/to other funds and advances to/from other funds. Further, certain activity occurs during
the year involving transfers of resources between funds reported at gross amounts as transfers in/out. While these balances
are reported in fund financial statements, certain eliminations are made in the preparation of the government -wide financial
statements. Balances between the funds included in governmental activities (i.e., the governmental and internal service
funds) are eliminated so that only the net amount is included as internal balances in the governmental activities column.
Similarly, balances between the funds included in business -type activities (i.e., the enterprise funds) are eliminated so that
only the net amount is included as internal balances in the business -type activities column. Transfers between the funds
included in governmental activities are eliminated so that only the net amount is included as transfers in the governmental
activities column. Similarly, balances between the funds included in business -type activities are eliminated so that only the
net amount is included as transfers in the business -type activities column.
E. Measurement Focus and Basis of Accounting
The accounting and financial reporting treatment is determined by the applicable measurement focus and basis of
accounting. Measurement focus indicates the type of resources being measured such as current financial resources or
economic resources. The basis of accounting indicates the timing of recognition in the financial statements of various kinds
of transactions or events. The government -wide, proprietary, and fiduciary fund 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 related cash flows. Property taxes are recognized
as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider have been met.
37 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The governmental fund financial statements are reported using the current financial resources measurement focus and the
modified accrual basis of accounting. Revenues are recognized when they have been earned and 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 City 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 principal and interest expenditures on general long-term debt,
including lease liabilities, as well as expenditures related to compensated absences, and claims and judgments,
postemployment benefits and environmental obligations are recognized later based on specific accounting rules applicable
to each, generally when payment is due. General capital asset acquisitions, including entering into contracts giving the City
the right to use leased assets, are reported as expenditures in governmental funds. Issuance of long-term debt and financing
through leases are reported as other financing sources.
Property taxes, sales taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all considered
to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Entitlements are recorded
as revenues when all eligibility requirements are met, including any time requirements, and the amount is received during
the period or within the availability period for this revenue source (within 60 days of year end). Expenditure -driven grants
are recognized as revenue when the qualifying expenditures have been incurred and all other eligibility requirements have
been met, and the amount is received during the period or within the availability period for this revenue source (within 60
days of year end). All other revenue items are considered to be measurable and available only when cash is received by the
City.
F. Budgetary Information
1. Budgetary Basis of Accounting
Annual budgets are adopted on a basis consistent with generally accepted accounting principles for the general fund,
Pearland Economic Development Corporation, other special revenue funds (excluding Development Authority of
Pearland and TIRZ #2), and the debt service fund. The capital projects fund is appropriated on a project -length basis. The
appropriated budget is prepared by fund, function, and department. The City's department heads may make transfers
of appropriations within a department. Transfers of appropriations between departments require the approval of the
Council. The legal level of budgetary control (i.e., the level at which expenditures may not legally exceed appropriations)
is the department level. Appropriations in all budgeted funds lapse at the end of the fiscal year even if they have related
encumbrances. Encumbrances are commitments related to unperformed (executory) contracts for goods or services (i.e.,
purchase orders, contracts, and commitments). While all appropriations and encumbrances technically lapse at year end,
valid outstanding encumbrances (those for which performance under the executory contract is expected in the next year)
are reappropriated and become part of the subsequent year's budget pursuant to state regulations, and the
encumbrances are automatically reestablished in the next year.
G. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balance
1. Cash and Cash Equivalents
The City's cash and cash equivalents are cash on hand, demand deposits, and short-term investments with original
maturities of three months or less from the date of acquisition. For the purpose of the statement of cash flows, the
Proprietary Fund Types consider temporary investments with maturity of three months or less when purchased to be
cash equivalents.
The City pools cash resources of its various funds to facilitate the management of cash. Cash applicable to a particular
fund is readily identifiable. The balance in the pooled cash accounts is available to meet current operating requirements.
Cash in excess of current requirements is invested in various interest -bearing accounts and securities and disclosed as
part of the City's investments.
38 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The City pools excess cash of the various individual funds to purchase these investments. These pooled investments are
reported in the combined balance sheet as investments in each fund based on each fund's share of the pooled
investments. Interest income is allocated to each respective individual fund, monthly, based on their respective share of
investments in the pooled investments.
2. Investments
Investments consist of Local Government Investment Pools, United States (U.S.) government agency securities, and
mutual funds. The City reports all investments at fair value, except for investment pools. The City's investment pools are
valued and reported at Net Asset Value (NAV), which approximates fair value.
The City categorizes fair value measurements of its investments based on the hierarchy established by generally accepted
accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure
an asset's fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are observable
inputs other those in Level 1; Level 3 inputs are unobservable inputs. The City's local government investment pools are
recorded at NAV as permitted by GASB Statement No. 79, Certain Investment Pools and Pool Participants, and are exempt
from reporting in the fair value hierarchy.
3. Inventory and Prepaid Items
Inventory, which consists of fuel and auto parts for use in the City's vehicles, is stated at cost (first -in, first -out method).
Expenditures are recognized as the fuel and auto parts are consumed rather when purchased. Certain payments to
vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government -
wide and fund financial statements. The cost of prepaid items is recorded as expenditures/expenses when consumed
rather than when purchased.
4. Receivables
All receivables are reported at their gross value, and where appropriate, are reduced by the estimated portion that is
expected to be uncollectible. Trade accounts receivable in excess of 120 days comprise the trade accounts receivable
allowance for uncollectibles.
5. Interfund Balances
Interfund receivables and payables arise from interfund transactions and are recorded by all funds affected in the period
in which the transactions are executed. These receivables and payables are classified as "due from other funds" or "due
to other funds." Interfund receivables and payables which are not expected to be paid within 12 months are classified as
loans from/loans to other funds.
6. Capital Assets
Capital assets are tangible and intangible assets, which include property, plant, equipment, and infrastructure assets
(e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business -type activities
column in the government -wide financial statements. Capital assets, except for infrastructure assets, are defined by the
City as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of one year.
As the City constructs or acquires capital assets each period, they are capitalized and reported at historical cost (except
for intangible right -to -use lease/SBITA assets, the measurement of which is discussed in a note below). The reported
value excludes normal maintenance and repairs, which are amounts spent in relation to capital assets that do not
increase the asset's capacity or efficiency or increase its estimated useful life. Donated capital assets are recorded at
acquisition value at the date of donation. Acquisition value is the price that would be paid to acquire an asset with
equivalent service potential on the date of the donation. Intangible assets follow the same capitalization policies as
tangible capital assets and are reported with tangible assets in the appropriate capital asset class.
39 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Land and construction in progress are not depreciated. The other tangible and intangible property, plant, equipment, the
right to use leased equipment, and infrastructure of the primary government are depreciated/amortized using the
straight-line method over the following estimated useful lives:
Asset
Infrastructure
Water and sewer system
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Intangible Water Rights
Right -to -use lease assets
Right -to -use SBITA
7. Restricted Assets
Years
10-50
30-50
10-45
3-15
3-10
25
Shorter of lease term or asset's useful life
Subscription term
Certain proceeds of the Water and Sewer Enterprise Fund revenue bonds and certain resources set aside for their
repayment are classified as restricted assets on the balance sheet because their use is limited by applicable bond
covenants. Certain resources are also set aside for repayment of Pearland Economic Development Corporation Bonds
and are reported as restricted assets.
8. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position includes a separate section for deferred outflows of resources.
Deferred outflows of resources represent a consumption of net assets that applies to a future period(s) and so will not
be recognized as an outflow of resources (expense/expenditure) until then. The City has the following items that qualify
for reporting in this category:
i. Deferred charge on refunding reported in the government -wide statement of net position. The deferred charge
on refunding resulted from the difference between 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.
ii. Deferred amounts related to pension and OPEB relate differences between estimated and actual investment
earnings, changes in actuarial assumptions, and other pension and OPEB related changes.
In addition to liabilities, the statement of financial position includes a separate section for deferred inflows of resources.
Deferred inflows of resources represent an acquisition of net assets that applies to a future period(s) and so will not be
recognized as an inflow of resources (revenue) until that time. The City has the following items that qualify for reporting
in this category:
i. Unavailable revenue is reported only in the governmental funds balance sheet. The governmental funds report
unavailable revenues from property taxes, UHCL receivable, special assessments, economic development
agreements, and other miscellaneous receivables. These amounts are deferred and recognized as an inflow of
resources in the period that the amounts become available.
ii. Deferred amounts related to leases and deferred amounts related to pension and OPEB are reported in the
government -wide financial statements.
40 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
9. Net Position
For government -wide reporting as well as in proprietary funds, the difference between assets and deferred outflows of
resources less liabilities and deferred inflows of resources is called net position. Net position is comprised of three
components:
• Net investment in capital assets consists of capital assets, net of accumulated depreciation/amortization and
reduced by outstanding balances of bonds, notes, and other debt that are attributable to the acquisition,
construction, or improvement of those assets. Deferred outflows of resources and deferred inflows of resources that
are attributable to the acquisition, construction, or improvement of those assets or related debt are included in this
component of net position.
• Restricted net position consists of restricted assets reduced by liabilities and deferred inflows of resources related
to those assets. Assets are reported as restricted when constraints are placed on asset use either by external parties
or by law through constitutional provision or enabling legislation.
• Unrestricted net position is the net amount of the assets, deferred outflows of resources, liabilities, and deferred
inflows of resources that does not meet the definition of the two preceding categories.
Sometimes the City will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant
proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted net position and
unrestricted net position in the government -wide and proprietary fund financial statements, a flow assumption must be
made about the order in which the resources are considered to be applied. It is the City's policy to consider restricted
net position to have been depleted before unrestricted net position is applied.
In governmental fund types, the difference between assets and deferred outflows of resources less liabilities and
deferred inflows of resources is called "fund balance." The City's governmental funds report the following categories of
fund balance, based on the nature of any limitations requiring the use of resources for specific purposes:
• Nonspendable—Amounts that cannot be spent either because they are not in a spendable form or because they are
legally or contractually required to be maintained intact.
• Restricted — Amounts that can be spent only for specific purposes because of the City Charter, City Code, State or
federal laws, or externally imposed conditions by grantors or creditors.
• Committed —Amounts than can be used only for specific purposes determined by ordinances passed by City Council,
the City's highest level of decision -making authority. Commitments may be modified or rescinded only through
ordinances approved by City Council.
• Assigned —Amounts that are intended to be used for a specific purpose, but do not meet the definition of restricted
or committed fund balance. Under the City's policy, amounts can be assigned by the City's Chief Financial Officer.
• Unassigned — Amounts that are available for any purpose. Positive amounts are reported only in the General Fund.
41 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
10. Fund Balance
Sometimes the City will fund outlays for a particular purpose from both restricted and unrestricted resources (the total
of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted,
committed, assigned, and unassigned fund balance in the governmental fund financial statements, a flow assumption
must be made about the order in which the resources are considered to be applied. It is the City's policy to consider
restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further,
when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is
depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.
City Council has authorized the Chief Financial Officer as the official authorized to assign fund balance to a specific
purpose. City Council has established fund balance and working capital policies under which the City shall maintain the
fund balance and working capital of the various operating funds at the following levels:
• General Fund Unassigned Fund Balance — The City shall maintain the General Fund unassigned fund balance
equivalent to three months of recurring operating expenditures, based on current year expenditures. If the
fund balance exceeds this amount, funding non -recurring expenditures in the following fiscal year may be used
to draw down the balance.
• Water/Sewer Unreserved Working Capital — The City shall maintain a working capital sufficient to provide for
reserves for emergencies and revenue shortfalls. A cash equivalent operating reserve will be established and
maintained at 25 percent of the current year's budget appropriation for recurring operating expenses. The cash
equivalent operating reserve is derived by dividing the total cash equivalents balance by recurring operating
expenses.
• Use of Fund Balance/Working Capital — Fund balance/working capital shall only be used for emergencies, non-
recurring expenditures/expenses or major capital purchases that cannot be accommodated through current
year savings. Should such use reduce balances below the level established as the objective for that fund,
restoration recommendations will accompany the request/decision to utilize said balances.
• Debt Service Fund Total Fund Balance — The City shall maintain the debt service fund balance at 10 percent of
annual debt service requirements OR a fund balance reserve as required by bond ordinances, whichever is
greater.
• Property Liability Insurance Fund Unrestricted Net Position —The Property Liability Insurance Fund accounts for
uninsured and deductible claims for the City's property and liability insurance. Claims cannot be reasonably
predicted and budgeted for; therefore, the fund will maintain a balance that approximates the prior average
annual expense for the last three years, excluding extra -ordinary expenses in the fund.
• Employee Benefits Fund and Health Claims Fund — The Employee Benefits Fund and Health Claims Fund are
funded through City and employee contributions. Estimated costs shall be determined during each budget year
and the contributions adjusted accordingly. There is no minimum balance for this fund as it relates to employee
benefits.
• Water/Sewer Revenue Debt Coverage Reserves — Revenues shall be maintained at 1.15 times coverage in a
fiscal year where the water/sewer fund is not issuing additional debt and 1.4 times coverage in a year where
debt is anticipated to be issued.
• Bond Issuance Reserves — Debt service reserves should be maintained for each bond issue as required by bond
covenants.
• Contingency Fund — Pursuant to the City Charter, a provision shall be made within the annual budget for a
contingency fund in an amount not more than 7 percent of the total budget (General Fund) to be used in case
of unforeseen items of expenditure.
42 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
11. Leases and Subscription -Based Information Technology Arrangements (SBITAs)
Lessee: The City is a lessee for a noncancellable right to use lease assets and subscription -based software. The City
recognizes a lease/SBITA liability and an intangible right -to -use lease/SBITA asset in the government -wide financial
statements. The City recognizes lease/SBITA liabilities with an initial, individual value of $5,000 or more.
At the commencement of a lease/SBITA, the City initially measures the liability at the present value of payments expected
to be made during the term. Subsequently, the liability is reduced by the principal portion of payments made. The asset
is initially measured as the initial amount of the liability, adjusted for payments made at or before the agreement's
commencement date, plus certain initial direct costs. Subsequently, the asset is amortized on a straight-line basis over
its useful life or subscription term.
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected
payments to present value, (2) lease/SBITA term, and (3) lease/SBITA payments.
• The City uses the interest rate charged by the vendor as the discount rate. When the interest rate charged by
the vendor is not provided, the City generally uses its estimated incremental borrowing rate as the discount
rate.
• The term includes the noncancellable period of the lease or subscription term. Payments included in the
measurement of the liability are composed of fixed payments and purchase option price that the City is
reasonably certain to exercise.
The City monitors changes in circumstances that would require a remeasurement of its leases/SBITAs and will remeasure
the assets and liabilities if certain changes occur that are expected to significantly affect the amount of the liabilities.
Lease/SBITA assets are reported with other capital assets and lease/SBITA liabilities are reported with long-term debt on
the statement of net position.
Lessor: The City is a lessor for a noncancellable lease of a building. The City recognizes a lease receivable and a deferred
inflow of resources in the government -wide and governmental fund financial statements.
At the commencement of a lease, the City initially measures the lease receivable at the present value of payments
expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of
lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease
receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred
inflow of resources is recognized as revenue over the life of the lease term.
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease
receipts to present value, (2) lease term, and (3) lease receipts.
• The City uses its estimated incremental borrowing rate as the discount rate for leases.
• The lease term includes the noncancellable period of the lease. Lease receipts included in the measurement of
the lease receivable is composed of fixed payments from the lessee.
The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the
lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the
amount of the lease receivable.
43 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
12. Compensated Absences
It is the City's policy to permit employees to accumulate earned but unused vacation, sick and holiday pay benefits.
Employees hired prior to October 1, 2005 earn vacation leave at the rate of 15 days per year from 1-15 years of service,
20 days per year for service of 16-19 years, and 25 days per year for service of 20 years or more. Employees, who are
non-exempt and are hired after October 1, 2005 earn vacation at a rate of 10 days per year from 1-4 years of service, 15
days per year for 5-14 years of service and 20 days for 15 and over years of service. Employees, who are exempt and are
hired after October 1, 2005, earn vacation at a rate of 15 days per year from 1-14 years of service, and 20 days for 15
and over years of service. Certified police personnel earn 15 days of vacation after one year and 20 days of vacation after
15 years. Effective October 1, 2011, certified fire fighter personnel earn 168 hours of vacation from 1-4 years, 241 hours
of vacation for 5-14 years and 312 hours after 15 years.
City employees receive 10 paid holidays per year. In addition to providing paid time off for the City -observed holidays,
the City permits regular full-time employees to take up to two (2) paid personal days (designated holidays) annually.
Employees required to work on a City -observed holiday may be paid or may elect to receive compensatory time off for
the holiday. Overtime is earned at one and one-half times the regular rate of pay for non-exempt employees. Employees
may be paid or receive compensatory time. The maximum accrual for compensatory time is 120 hours, including
employees involved in public safety.
All sick leave benefits are accumulated and paid to employees upon separation from the City not to exceed 720 hours
for employees hired prior to July 24, 2006, and 360 hours for employees hired after. Vacation, sick and holiday pay
benefits are accrued when incurred in the government -wide and proprietary fund financial statements. A liability for
these amounts is reported in governmental funds only if they have matured, for example, as a result of employee
resignations and retirements.
13. Pensions
For purposes of measuring the net pension liability, pension related deferred outflows and inflows of resources, and
pension expense, City -specific information about its Fiduciary Net Position in the Texas Municipal Retirement System
(TMRS) and additions to/deductions from the City's Fiduciary Net Position have been determined on the same basis as
they are reported by TMRS. For this purpose, plan contributions are recognized in the period that compensation is
reported for the employee, which is when contributions are legally due. Benefit payments and refunds are recognized
when due and payable in accordance with the benefit terms. Investments are reported at fair value. Information
regarding the City's Total Pension Liability is obtained from TMRS through a report prepared for the City by TMRS
consulting actuary, Gabriel Roeder Smith & Company, in compliance with GASB Statement No. 68, Accounting and
Financial Reporting for Pensions, as amended by GASB Statement No. 71.
14. Other Postemployment Benefits (OPEB) — Retiree Health Care
The City provides its retirees the opportunity to maintain health insurance coverage by participating in the City's
insurance plan. The City reports the total liability for this plan on the government -wide and proprietary fund financial
statements. The actual cost recorded in the governmental fund financial statements is the cost of the health benefits
incurred on behalf of the retirees less the premiums collected from the retirees. Information regarding the City's total
liability for this plan is obtained through a report prepared by HUB International, the City's third -party actuary, in
compliance with GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions.
44 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
15. Other Postemployment Benefits (OPEB) — TMRS Supplemental Death Benefits
Additionally, the City participates in a defined -benefit group -term life insurance plan, both for current and retired
employees, administered by the Texas Municipal Retirement System (TMRS). The City reports the total liability for this
plan on the government -wide and proprietary fund financial statements. Information regarding the City's total OPEB
liability is obtained from TMRS through a report prepared for the City by TMRS' consulting actuary, Gabriel Roeder Smith
& Company, in compliance with GASB Statement No. 75.
H. Revenues and Expenditures/Expenses
1. Program Revenues
Amounts reported as program revenues include (1) charges to customers or applicants who purchase, use, or directly
benefit from goods, services, or privileges provided or fines imposed by a given function or segment, and (2) grants and
contributions (including special assessments) that are restricted to meeting the operational or capital requirements of a
particular function or segment. All taxes, including those dedicated for specific purposes, and other internally dedicated
resources are reported as general revenues rather than as program revenues.
2. Property Taxes
Property taxes attach as an enforceable lien on real property and are levied as of July 1. The tax levy is divided into two
billings: the first billing (mailed on July 1) is an estimate of the current year's levy based on the prior year's taxes; the
second billing (mailed on January 1) reflects adjustments to the current year's actual levy. The billings are considered
past due 30 days after the respective tax billing date, at which time the applicable property is subject to lien,
and penalties and interest are assessed.
3. Proprietary Funds Operating and Nonoperating Revenues and Expenses
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and
expenses generally result from providing services and producing and delivering goods in connection with a proprietary
fund's principal ongoing operations. The principal operating revenues of the water and sewer fund, solid waste fund, and
internal service funds are charges to customers for sales and services. The water and sewer fund also recognizes as
operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the system.
Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative
expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as
nonoperating revenues and expenses.
I. Estimates
The preparation of financial statements, in conformity with generally accepted accounting principles, requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and
expenditures during the reporting period. Actual results could differ from those estimates.
45 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
J. New Accounting Standards
GASB issued Statement No. 101, Compensated Absences, in June 2022. The primary objective of this Statement is to better
meet the information needs of financial statement users by updating the recognition and measurement guidance for
compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified
model and by amending certain previously required disclosures. The requirements of this Statement are effective for fiscal
years beginning after December 15, 2023, and all reporting periods thereafter. The requirements of this statement were
implemented in fiscal year 2025 and the impact is reflected in the financial statements. A restatement to the City's beginning
net position was not necessary.
GASB issued Statement No. 102, Certain Risk Disclosures, in December 2023. The primary objective of this Statement is to
provide users of government financial statements with essential information about risks related to a government's
vulnerabilities due to certain concentrations or constraints. The requirements of this Statement are effective for fiscal years
beginning after June 15, 2024, and all reporting periods thereafter. The requirements of this statement were implemented
in fiscal year 2025 and did not impact the financial statements.
Note 2 — Cash and Investments
The City's investment portfolio is managed in accordance with the Texas Public Funds Investment Act, as amended, and its
own Investment Policy. The Texas Public Funds Investment Act (PFIA), as prescribed in Chapter 2256 of the Texas Government
Code, regulates what types of investments can be made, requires written investment policies, mandates training
requirements of investment officers, requires internal management reports to be produced at least quarterly, and provides
for the selection of authorized broker -dealers and investment managers.
The Council has adopted a written investment policy regarding the investment of City funds as required by the Public Funds
Investment Act (Chapter 2256, Texas Government Code). The investments of the City are in compliance with the City's
investment policy. The City's investment policy is more restrictive than the PFIA requires. It is the City's policy to restrict its
direct investments to obligations of the U.S. government or U.S. government agencies, obligations of states, counties, and
cities, fully collateralized certificates of deposit, bankers' acceptances, mutual funds, repurchase agreements and local
government investment pools. The maximum maturity allowed is five years from date of purchase. The City's investment
policy does not allow investments in collateralized mortgage obligations. As of September 30, 2025, the City's investment
portfolio contains mutual funds, government investment pools, and obligations of U.S. government agencies. Each of the
City's investments are in compliance with the PFIA.
In accordance with applicable statutes, the City has a depository contract with an area bank (depository) providing for interest
rates to be earned on deposited funds and for banking charges the City incurs for banking services received. The City may
place funds with the depository in interest and non -interest -bearing accounts. State law provides that collateral pledged as
security for bank deposits must have a fair value of not less than the amount of the deposits and must consist of: (1)
obligations of the United States or its agencies and instrumentalities; (2) direct obligations of the State of Texas or its agencies;
(3) other obligations, the principal and interest on which are unconditionally guaranteed or insured by the State of Texas;
and/or (4) obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as
to investment quality by a nationally recognized investment rating firm and having received a rating of not less than A or its
equivalent. City policy requires the collateralization level to be at least 102 percent of fair value of principal and accrued
interest.
The City's cash and investments are classified as: cash and cash equivalents, investments, and restricted cash and
investments. The cash and cash equivalents include cash on hand, demand deposits with financial institutions, and short-
term investments, which have maturities at purchase of less than three months. The restricted cash and investments are
assets restricted for specific use. The restricted cash and investments include cash on deposit with financial institutions. For
better management of cash, the City pools the cash, based on the City's needs, into either bank/sweep accounts, or in longer -
term investments in U.S. government securities. However, each fund's balance of cash and investments is maintained in the
books of the City. The City's investments primarily consist of government investment pools. The City's investments in
46 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
government pools are measured at net asset value. The investment pools do not have any limitations or restrictions on
withdrawals, such as notice periods or maximum transaction amounts, and do not impose any liquidity or redemption gates.
The deposit and investment policies for the Pearland Economic Development Corporation, TIRZ No. 2, and Development
Authority of Pearland are substantially the same as the City.
The following schedule shows the City's recorded cash and cash equivalents and investments at year-end:
Percent of
Amount Portfolio WAM
Cash and Cash Equivalents:
Demand depots (book value) $ 309,938,084 57.5% 1
Mutual Fund 22,820,180 4.2% 1
Investment Pools:
Texas CLASS 105,937,460 19.6% 43
TexSTAR 10,770,439 2.0% 49
LOGIC 34,915,730 6.5% 46
Total Investment Pools 151,623,629 28.1%
Total Cash and Cash Equivalents 484,381,893 89.8%
Investments:
US Treasury Bills/Notes
Total Investments
Total Cash and Investments
55,043,196 10.2% 675
55,043,196 10.2%
$ 539,425,089 100.0% 82
At September 30, 2025, the City's demand deposits were covered federal depository insurance and pledged collateral held
by the City's agent in the City's name.
The amount of increase or decrease in the fair value of investments during the current year is included in the City's investment
income as follows:
Interest income
Unrealized gain (loss)
$ 21,048,791
(6,555)
$ 21,042,236
The City's investments' fair value measurements are as follows at September 30, 2025.
Fair Value
Fair Value Measurements Using
quoted Prices in
Active Markets Significant Other Significant
for Identical Observable Unobservable
Assets Inputs Inputs
(Level 1) (Level 2) (Level 3)
US Treasury Bills/Notes $ 55,043,196 $ 55,043,196 $
$ 55,043,196 $ 55,043,196 $
$
$
The US Treasury Bills/Notes are valued based on price data obtained from observed transactions and market price quotations
from broker dealers and/or pricing vendors.
47 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The City's investments in government pools include deposits in TexSTAR, Texas CLASS and LOGIC. These pools operate
similarly to money market funds and each share is equal in value to $1.00. The value of the pool is equal to the value of the
pool shares. The investments in government pools are measured at NAV and are exempt from reporting in the fair value
hierarchy.
TexSTAR was created in April 2002 pursuant to the Interlocal Cooperation Act of the State of Texas, chapter 791 of the Texas
Government Code and the Public Funds Investment Act, chapter 2256 of the Texas Government Code. TexSTAR policies
require that local government deposits be used to purchase investments authorized by the Texas Public Funds Investment
Act. The State Comptroller of Public Accounts exercises responsibility over TexSTAR. TexSTAR is administered by Hilltop
Securities, Inc. and J.P. Morgan Investment Management. J.P. Morgan Investment Management, Inc. provides investment
advisory services.
The Texas Cooperative Liquid Assets Securities System Trust (Texas CLASS) was created as a local government investment
pool (LGIP) pursuant to Section 2256.016 of the Public Funds Investment Act, Texas Government Code (PFIA). Per state code,
entities may pool any of their funds, or funds under their control, to preserve principal, maintain the liquidity of the funds,
and maximize yield. The Texas CLASS Trust Agreement is an agreement of indefinite term regarding the investment,
reinvestment, and withdrawal of local government funds. The parties to the Trust Agreement are Texas local government
entities that choose to participate in the Trust (the Participants), Public Trust Advisors, LLC (Public Trust) as Program
Administrator, and Wells Fargo Bank Texas, N.A. as Custodian. The investment pools do not have any limitations or restrictions
on withdrawals, such as notice periods or maximum transaction amounts, and do not impose any liquidity or redemption
gates.
LOGIC is a local government investment pool organized under the authority of the Interlocal Cooperation Act, chapter 791,
of the Texas Government Code, and the Public Funds Investment Act, chapter 2256, of the Texas Government Code. LOGIC's
investment objectives are to seek preservation of principal, liquidity, and current income through investment in a diversified
portfolio of short-term marketable securities. Since September 2005, J.P. Morgan Investment Management Inc. (JPMIM) has
served as investment adviser to LOGIC. JPMIM is an SEC registered investment adviser and an affiliate of J.P Morgan Asset
Management (JPMAM), which is the marketing name for the asset management business of JPMorgan Chase & Co. Hilltop
Securities Inc. (Hilltop Securities) and JPMIM serve as co -administrators to LOGIC and Hilltop Securities provides
administrative, participant support, and marketing services. Hilltop Securities is a registered broker dealer, member of
FINRA/SIPC, which provides financial advisory and investment banking services to governmental entities across the county.
JPMorgan Chase Bank N.A. provides custodial services.
Interest Rate Risk
The City's investment policy specifies a maximum weighted average maturity for the portfolio of 900 days or 30 months based
on the stated maturity date of the investments. When including cash investments, the weighted average maturity for the City
was 82 days as of September 30, 2025. To the extent possible, the City attempts to match investments with anticipated cash
flow requirements. The City does not directly invest in securities with a stated maturity date more than five years or 1,825
days from date of purchase. The settlement date is considered the date of purchase.
Concentration of Credit Risk
With the exception of U.S. Treasury Securities and interest -bearing checking accounts that are fully collateralized, no more
than 75 percent of the City's total investment portfolio will be invested in a single security type. If the City elects to participate
in more than one investment pool, the total percent invested in all pools shall not exceed the maximum percent allowed. As
of September 30, 2025, the City's investment portfolio was in compliance with the City's investment policy as it relates to
diversification and concentration of credit risk.
48 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Credit Risk
All credit ratings meet acceptable levels required by guidelines prescribed by both the PFIA and the City's investment policy.
A public fund investment pool must be continuously rated no lower than AAA or AAAm or no lower than investment grade
by at least one nationally recognized rating service and have a weighted average maturity no greater than 90 days.
Investments with minimum required ratings do not qualify as authorized investments during the period the investment does
not have the minimum rating. TexSTAR, Texas CLASS, and LOGIC are rated AAAm by S&P Global Ratings.
In accordance with GASB Statement No. 79, Certain External Investment Pools and Pool Participants, the Local Government
Investment Pools do not have any limitations and restrictions on withdrawals such as notice periods or maximum transaction
amounts. These pools do not impose any liquidity fees or redemption gates.
Restricted Assets
The Enterprise Funds have restricted certain cash and investments for customer deposits, reserve and emergency expenses,
capital improvements, cash restricted for others, and revenue bond debt service. Because of certain bond covenants, the
Enterprise Funds are required to maintain prescribed amounts of resources that can be used only to service outstanding debt.
Some of the proceeds from debt or from funds received from acquisition of Municipal Utility Districts are restricted for use
on capital projects.
Revenue bond debt service $ 14,558,316
Customer deposits 4,255,611
Capital improvements (impact fees) 9,258,330
Unspent bond proceeds 89,588,022
Total $ 117,660,279
49 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 3 — Receivables
Receivables at September 30, 2025, consisted of the following for the governmental funds:
Receivables
Property taxes, including
penalties and interest
Street assessments
Franchise taxes
Financing lease (UHCL)
Sales and other taxes
Economic development
agreements
Leases
Intergovernmental
Other
Gross Receivables
Allowance for
uncollectibles
Net Receivable
Debt Capital
General Fund Service Fund Projects Fund
$ 847,075 $ 935,377
1,728,875
5,262,179
1,597,097
1,203,270
10,638,496 3,483,093
(20,869) (24,321)
$ 10,617,627 $ 3,458,772
2,547,716
Pearland
Economic
Development
Corporation
$ $
2,631,089
1,000,000 6,311,182
3,143,570 -
8,932
4,143,570 8,951,203
$ 4,143,570 $ 8,951,203
Governmental funds report receivables for revenues that are
current period. At the end of the current fiscal year, the various
amounts, and unearned revenue reported in the governmental
Tax Increment
Reinvestment
Zone#2
Development
Authority of
Pearland
$ $
56,145
56,145
$ 56,145
Non -Major
Governmental
Funds
Total
$ 1,782,452
8,916 1,737,791
2,547,716
7,893,268
708 1,522,245
708 1,531,161
$ 708
7,311,182
1,597,097
3,143, 570
2,791,300
28,804,376
(45,190)
$ 1,531,161 $ 28,759,186
not considered to be available to liquidate liabilities of the
components of unavailable revenue, excluding lease -related
funds were as follows:
Unearned Revenue:
Parks and recreation department (deposits & prepayments)
Economic development agreements
ARPA grant
Total Unearned Revenue
Unavailable Revenue:
Delinquent property taxes receivable
UHCL receivable
Economic development agreements
Intergovernmental
Total Unavailable Revenue
Amount
$ 119,045
66,887
2,135, 689
$ 2,321,621
Amount
$ 1,692,811
2,408,485
7,311,182
3,143, 570
$ 14,556,048
50 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Receivables at September 30, 2025, consisted of the following for the proprietary funds:
Governmental
Business -type Activities - Enterprise Funds Activities
Water and Solid Waste Internal
Sewer Fund Fund Total Service Fund
Receivables
Customer accounts:
Billed $ 6,880,135 $ 1,027,595 7,907,730 $ 221,324
Unbilled 6,306,184 - 6,306,184
Other 800,412 83,992 884,404
Allowance for
uncollectibles (1,861,032) (426,503) (2,287,535)
$ 12,125,699 $ 685,084 $ 12,810,783 $ 221,324
City utility customers are billed on the basis of monthly cycle billings. At the end of the fiscal year, the City accrues estimated
unbilled revenues for water and sewer services and solid waste services provided before the period ended September 30, to
be billed after year-end.
Property Taxes
Property taxes are levied by October 1 in conformity with Subtitle E, Texas Property Tax Code. Taxes are due on receipt of
the tax bill and are delinquent if not paid before February 1 of the year following the year in which imposed. On January 1 of
each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed. The
Central Appraisal District (CAD) of Brazoria County, Harris County, and Fort Bend County, Texas, establishes appraised values.
Taxes are levied by the City Council based on the appraised values and operating needs of the City. The City contracts billing
and collection of tax levies with the Brazoria County Tax Assessor -Collector.
UHCL Lease Receivable
The City has a 20 -year agreement with the University of Houston Clear Lake (UHCL), which commenced in July 2010. Under
the agreement, the City issued certificates of obligation to construct a facility to be used by and ultimately transferred to
UHCL, with UHCL supporting most of the related debt service payments on the certificates of obligation. The agreement
provides that UHCL pay the City for debt service and operating costs through March 1, 2029, when the bond matures and the
property transfers to UHCL.
The payments related to debt service to be received coincide with debt service payments the City is required to make on the
certificates of obligations that mature on March 1, 2029. At September 30, 2025, the future minimum debt service payments
to be received under the agreement are as follows:
Year Principal Interest Payment
2026 $ 713,681 $ 74,939 $ 788,620
2027 573,926 52,277 626,203
2028 569,248 30,204 599,452
2029 524,090 9,351 533,441
$ 2,380,945 $ 166,771 $ 2,547,716
51 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 4 — Capital Assets
A summary of changes in the City's capital assets for the year ended September 30, 2025, is as follows:
Governmental Activities
Governmental Activities
Capital Assets, not being Depreciated:
Land
Construction in progress
Total Capital Assets, not being
Depreciated
Capital Assets, being Depreciated:
Infrastructure
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Right -to -use lease equipment
Right -to -use lease buildings
Right -to -use SBITA assets
Total Other Capital Assets, being
Depreciated
Less Accumulated Depreciation for:
Infrastructure
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Right -to -use lease equipment
Right -to -use lease buildings
Right -to -use SBITA assets
Total Accumulated Depreciation
Total Capital Assets being
depreciated, net
Governmental Activities Capital Assets, Net
Beginning
Balance, as
restated
$ 51,483,358 $
76,152, 606
127,635,964
1,243,402,770
225,357,441
41,680,933
36,201,727
91,137
105,603
9,001,741
1,555,841,352
(616,272,401)
(68,463,162)
(27,736,645)
(11,491,208)
(30,379)
(21,498)
(4,587,313)
(728,602,606)
827,238,746
$ 954,874,710
Increases
906,980 $
57,588,379
58,495,359
3,271,908
215,752
1,595,619
1,569,741
1,978,418
8,631,438
(43,101,733)
(8,141,746)
(3,680,109)
(1,655,660)
(60,758)
(84,105)
(2,668,971)
(59,393,082)
(50,761,644)
$ 7,733,715
Disposals
(91,137)
(105,603)
(877,051)
(1,073,791) 35,476,867 1,598,875,866
Transfers to
Depreciable
Assets Ending Balance
$ - $ 52,390,338
(35,476,867) 98,264,118
(35,476,867) 150,654,456
91,137
105,603
877,051
1,073,791
26,934,690 1,273,609,368
8,542,177 234,115,370
43,276,552
37,771,468
10,103,108
(659,374,134)
(76,604,908)
(31,416,754)
(13,146, 868)
(6,379,233)
(786,921,897)
35,476,867 811,953,969
$ - $ 962,608,425
52 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Business -type Activities
Business -type Activities
Capital Assets, not being Depreciated:
Land
Construction in progress
Total Capital Assets, not being Depreciated:
Capital Assets, being Depreciated
Water and sewer system
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Contractual water rights
Total Capital Assets, being Depreciated
Less Accumulated Depreciation:
Water and sewer system
Buildings and improvements
Machinery and equipment
Furniture and fixtures
Contractual water rights
Total Accumulated Depreciation
Total Capital Assets being
Depreciated, net
Totals
Beginning
Balance, as
restated
$ 10,343,706
321,025,929
331,369,635
491,326,340
32,157,965
5,610,506
176,347
34,511,428
563,782,586
(207,425,899)
(12,151, 689)
(5,037,153)
(165,566)
(22,426,334)
(247,206,641)
316,575,945
$ 647,945,580
Increases
57,268,153
57,268,153
15,654
15,654
(18,303,703)
(386,120)
(214,266)
(12,234)
(1,375,069)
(20,291,392)
(20,275,738)
$ 36,992,415
Depreciation/amortization was charged to programs as follows:
Governmental Activities
General government
Public safety
Public works
Community services
Parks and recreation
Total Governmental Activities
Business -type activities:
Water and sewer
Total Depreciation Expense, Primary Government
Disposals
(668,078)
(362,256)
(1,030,334)
668,078
362,256
1,030,334
Transfers to
Depreciable
Assets
Ending Balance
$ $
(297,470,860)
(297,470,860)
297,470,860
297,470,860
10,343,706
80,823,222
91,166,928
788,129,122
32,157,965
5,248,250
192,001
34,511,428
860,238,766
(225,061,524)
(12,537,809)
(4,889,163)
(177,800)
(23,801,403)
(266,467,699)
297,470,860 593,771,067
$ - $ 684,937,995
Depreciation/
Amortization Expense
$ 15,099,260
1,891,683
39,489,526
268,097
2,644,516
59, 393,082
20,291,392
$ 79,684,474
53 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The City had active construction projects as of September 30, 2025. The projects included various improvements to streets,
drainage and facilities and water and sewer improvements. At year-end, the City's contractual commitments on projects were
as follows:
Project Description
Drainage
Facilities
Parks and Recreation
Streets
Total Governmental Activities
Facilities
Water and Sewer Improvements
Total Business -Type Activities
Total Primary Government
Note 5 — Long-term Debt
Contract
$ 47,430,064
87,989,734
24,143,160
249,345,654
408,908,612
21,263,500
476,863,900
498,127,400
$ 907,036,012
Total
In Progress
$ 17,399,078
22, 717,139
5,329,890
52,818,011
98, 264,118
388,533
80,434,689
80,823,222
$ 179,087,340
Remaining
Commitment
$ 30,030,986
65,272,595
18,813,270
196,527,643
310,644,494
20,874,967
396,429,211
417, 304,178
$ 727,948,672
The City issues general obligation bonds and certificates of obligation, and upon annexation and dissolution of Municipal
Utility Districts, assumes unlimited tax and revenue obligations. The assumed obligations were used to acquire and construct
major capital facilities. General obligation bonds, certificates of obligation, and assumed obligations from dissolved and
annexed areas are for both governmental and business -type activities. The bonds are reported in the Proprietary Funds only
if they are expected to be repaid from proprietary revenues. The general long-term bonds, certificates of obligation and
assumed obligations are paid through the Debt Service Fund from tax revenues.
The City's component units, which are considered blended components units, have revenue bonds used to acquire and
construct or to reimburse developers for major capital improvements. Revenue bonds are paid through the Pearland
Economic Development Corporation from sales tax and through the Development Authority of Pearland from property tax
increment.
In general, the City uses the General and Debt Service funds as well as the Economic Development Corporation and
Development Authority to liquidate governmental long-term liabilities. Long-term liabilities applicable to the City's
governmental activities are not due and payable in the current period, and accordingly, are not reported as fund liabilities in
the governmental funds. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an
expenditure when due. The full amount estimated to be required for debt service on general obligation debt is provided by
(1) the debt service portion of the tax levy; (2) interest earned in the Debt Service Fund; and (3) transfers from the Water and
Sewer Enterprise Fund. Transfers from the Enterprise Funds are approved at the discretion of City Council and are not
intended to service a specific bond series.
54 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Changes in Long-term Liabilities
The following is a summary of changes in the City's total governmental long-term liabilities for the year ended September 30,
2025.
Governmental Activities
Bonds Payable:
General obligation bonds
General obligation bonds -
BC MUD #16
General obligation bonds -
Private Placement
Certificates of obligation
Sales tax revenue bonds
Tax increment revenue bonds
Tax increment revenue bonds -
Private placement
Unamortized premium/discount
Total Bonds Payable
Other Long -Term Liabilities:
Leases
Financed purchases
SBITAs
Compensated absences
Total Governmental Activities
Long -Term Liabilities
Beginning Ending Amounts Due
Balance Increases Decreases Balance in One Year
$ 267,925,000 $ 33,400,000 $ (45,485,000) $ 255,840,000 $ 23,155,000
11,085,000 (520,000) 10,565,000 535,000
3,600,000 - (850,000) 2,750,000 885,000
120,000,000 18,955,000 (17,700,000) 121,255,000 4,275,000
500,000 - (250,000) 250,000 250,000
46,785,000 - (8,860,000) 37,925,000 9,100,000
10,335,000 - (1,920,000) 8,415,000 1,990,000
27,558,856 1,903,426 (6,353,559) 23,108,723 -
476,703,856 65,343,426 (81,938,559) 460,108,723 40,190,000
148,819 (148,819) - - 20,293
1,218,141 (281,668) - 936,473 296,399
4,494,536 1,978,418 (2,567,524) 3,905,430 2,007,836
10,162,217 3,878,835 - 14,041,052 788,787
$ 492,727,569 $ 70,770,192 $ (84,506,083) $ 478,991,678 $ 43,303,315
During the current fiscal year, the City issued the following bonds in the governmental activities:
• Permanent Improvement & Refunding Bonds, Series 2025, in the amount of $33,400,000 with a premium of
$1,369,718.
o The new money portion of the bonds was $9,850,000 with a premium of $169,120 and will be used for
construction and improvements to the City's drainage system, roads, streets, bridges, sidewalks, parks, and
construction/improvements to Fire Station No. 7.
o The refunding portion of the bonds was $23,550,000 with a premium of $1,200,598 and were used to
refund $24,550,000 of general obligation bonds and certificates of obligation. The City contributed
$598,377 of debt service funds as part of the transaction and incurred $207,246 in bond issuance costs. The
net carrying value of the refunded bonds exceeded the amount paid to refund the bonds, resulting in a
deferred loss of $88,446. The transaction resulted in net present value debt service savings of $804,306.
• Certificates of Obligation, Series 2025A, in the amount of $18,955,000 with a premium of $533,708. The proceeds
will be used for the (i) purchase and installation of a generator for Hickory Slough Storm Detention Water Pump
Station; (ii) construction of Hillhouse Road Annex Phase II; (iii) construction of an Emergency Distribution
Warehouse; (iv) construction and improvements to Knapp Activity Center, including, but not limited to, HVAC
improvements; (v) construction and improvements to Clear Creek Trail Segment 5; and (vi) certain street, road and
bridge repairs and improvements within the City.
In addition, the City defeased $2,285,000 of Certificates of Obligation, Series 2020B, and $10,350,000 of Certificates of
Obligation, Series 2021B. The City paid $13,169,340, including $10,000 of debt service expenses, which resulted in a current
period loss of $534,340. The transaction resulted in net present value savings of $2,624,410.
55 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Lastly, the City annexed Brazoria County Municipal Utility District No. 16 ("BC MUD #16" or the "District") during the fiscal
year. As part of the annexation, the City assumed the District's outstanding general obligation bonds in the amount of
$11,085,000. In exchange, the District contributed $2,587,082 to the City of which $1,158,572 was deposited to the general
fund for operating costs and $1,428,510 was deposited to the debt service fund for principal and interest payments. The
District also transferred capital assets to the City in the amount of $4,018,568 of which $746,660 was land and $3,271,908
was infrastructure. As a result, the governmental activities reported a net loss of $4,479,350, consisting of $7,066,432 for the
acceptance of the capital assets and general obligation bonds, less cash received of $2,587,082.
The following is a summary of changes in the City's total business -type activities long-term liabilities for the year ended
September 30, 2025.
Beginning Ending Amounts Due
Business -type Activities Balance Increases Decreases Balance Within One Year
Bonds Payable:
General obligation bonds $ 1,245,000 $ - $ (1,245,000) $ - $ -
Certificates of obligation 176,565,000 115,480,000 (2,695,000) 289,350,000 3,865,000
Water and sewer revenue bonds 344,190,000 - (19,165,000) 325,025,000 19,660,000
Unamortized premium/discount 17,668,426 3,638,123 (2,267,484) 19,039,065 -
Total Bonds Payable 539,668,426 119,118,123 (25,372,484) 633,414,065 23,525,000
Other Long -Term Liabilities:
Compensated absences
Total Business -type Activities
Long -Term Liabilities
900,841 596,358 - 1,497,199
$ 540,569,267 $ 119,714,481 $ (25,372,484) $ 634,911,264 $ 23,525,000
During the current fiscal year, the City issued the following bonds in the business -type activities:
• Certificates of Obligation, Series 2025B, in the amount of $115,480,000 with a premium of $3,638,123. The proceeds
will be used (i) construction, improvements and expansion to the Barry Rose Water Reclamation Facility in the City
and (ii) other construction, rehabilitation, repairs, improvements, additions and extensions to the City's water and
sewer system.
The business -type activity long-term debt will be repaid, plus accrued interest, from operating revenues of the Water and
Sewer Fund. The City is required by the applicable revenue bond indentures to pledge the net revenues of the Water and
Sewer Fund for the retirement of its outstanding revenue bonds, including interest thereon. Revenue bonds and refunding
bonds are payable solely from and, equally secured by, a first lien on and pledge of the net revenue of the City's Water and
Sewer Fund.
56 City of Pearland, Texas 2025 ACFR
Fiscal General Obligation BC MUD #16
Year Principal Interest Principal Interest
2026 $ 23,155,000 $ 10,956,650 $ 535,000 $ 368,114 $
2027 23,795,000 9,788,033 560,000 351,070
2028 24,715,000 8,642,567 570,000 332,795
2029 26,335,000 7,494,651 585,000 313,295
2030 22,705,000 6,417,936 595,000 292,670
2031- 2035 71,385,000 20,685,469 3,255,000 1,133,239
2036 - 2040 30,070,000 11,103,750 3,825,000 519,844
2041- 2045 13,030,000 6,401,379 640,000 33,600
2046 - 2050 10,230,000 3,935,000
2051- 2055 10,420,000 1,112,750
$ 255,840,000 $ 86,538,185 $ 10,565,000 $ 3,344,627 $
Fiscal
Year
2026
2027
2028
2029
2030
2031- 2035
2036 - 2040
2041- 2045
2046 - 2050
2051 - 2055
Sales Tax Revenue Bonds Tax Increment Revenue Bonds
Principal Interest Principal Interest
$ 250,000 $ 5,900 $ 9,100,000 $ 1,037,024 $
$ 250,000 $
9,350,000
9,605,000
9,870,000
788,940
533,537
270,676
5,900 $ 37,925,000 $ 2,630,177 $
Business -type Activities
Fiscal Certificates of Obligation Revenue Bonds
Year Principal Interest Principal Interest
2026 $ 3,865,000 $ 14,331,684 $ 19,660,000 $ 6,210,526 $
2027 4,325,000 14,055,164 19,980,000 5,717,370
2028 4,655,000 13,838,914 19,250,000 5,203,648
2029 5,065,000 13,606,164 19,595,000 4,682,914
2030 5,530,000 13,352,914 19,920,000 4,172,015
2031- 2035 37,830,000 61,885,570 82,295,000 14,441,921
2036 - 2040 51,040,000 51,090,830 59,840,000 7,518,941
2041 - 2045 53,775,000 37,827,800 46,730,000 3,996,347
2046 - 2050 59,305,000 24,611,174 35,230,000 1,495,014
2051 - 2055 63,960,000 8,912,690 2,525,000 52,520
$ 289,350,000 $ 253,512,904 $ 325,025,000 $ 53,491,216 $
Prior Year Refunding
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The debt service requirements for the City's bonds are as follows:
Governmental Activities
General Obligation General Obligation
Private Placement
Principal Interest
885,000
915,000
950,000
$ 83,070
50,670
17,100
2,750,000 $
150,840
Governmental Activities
Tax Increment Revenue Bonds
Private Placement
Principal Interest
1,990,000 $ 314,721
2,065,000 240,295
2,140,000 163,064
2,220,000 83,028
8,415,000 $
801,108
Total
Business -type Activities
Principal
23,525,000
24,305,000
23,905,000
24,660,000
25,450,000
120,125,000
110,880,000
100,505,000
94,535,000
66,485,000
614,375,000
Interest
$ 20,542,210
19,772,534
19,042,562
18,289,078
17,524,929
76,327,491
58,609,771
41,824,147
26,106,188
8,965,210
$ 307,004,120
Certificates of Obligation
Principal Interest
$ 4,275,000
4,450,000
6,105,000
3,905,000
29,845,000
23,495,000
18,500,000
10,465,000
9,880,000
10,335,000
$ 121,255,000
$
$
$ 5,456,773
5,255,957
5,024,032
4,808,613
3,996,176
13,779,325
9,323,074
6,112,077
3,867,250
1,137,375
$ 58,760,652
Total
Governmental Activities
Principal
40,190,000
41,135,000
44,085,000
42,915,000
53,145,000
98,135,000
52,395,000
24,135,000
20,110,000
20,755,000
437,000,000
$
$
Interest
18,222,252
16,474,965
14,713,095
12,970,263
10,706,782
35,598,033
20,946,668
12,547,056
7,802,250
2,250,125
152,231,489
Total Primary Government
Principal Interest
$ 63,715,000 $ 38,764,462
65,440,000 36,247,499
67,990,000 33,755,657
67,575,000 31,259,341
78,595,000 28,231,711
218, 260,000 111, 925, 524
163,275,000 79,556,439
124,640,000 54,371,203
114,645,000 33,908,438
87,240,000 11, 215,335
$ 1,051,375,000 $ 459,235,609
In prior years, the City defeased certain general obligation and other bonds by placing the proceeds of the new bonds in an
irrevocable trust to provide for all future debt service payments on the refunded bonds. Accordingly, the trust account assets
and the liability for the defeased bonds are not included in the City's financial statements. At September 30, 2025, the City
had $31,905,000 of previously refunded bonds outstanding or outstanding refunding escrows.
57 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Subscription -Based Information Technology Arrangements (SBITAs)
The City is under contract for noncancellable SBITAs that convey control of the right to use software. The SBITA liabilities
outstanding as of September 30, 2025, are as follows:
Governmental Activities
All Traffic Solutions - Subscription
Aurigo Software
CISCO - Collaboration Software
ClearGov Subscription
ESO Solutions - FD Records Management Software
ESRI - ArcGIS GeoEvent Server
Fleetio Manage - Enterprise
Flock Group Auto License Plate Reader Software
Flock Group Falcon Safety Subscription
Ion Wave - Strategic Sourcing Software
Microsoft Enterprise
Microsoft Software
NetCloud Mobile Essentials
OMNISSA-BROADCOM
Open Counter - Software
Opticom Cloud Platform
PerfectMind Software
PLL ELA Premium
Sequel - Infoblox DDI
Sequel Data Systems - Ekahau Connect
Voice Products - NICE Software
Utility Operations Software
Watch Guard Software
WaterSmart Platform
Total Lease Liability
Start
Date
11/15/22
10/01/22
03/24/25
05/01/23
06/02/25
01/10/25
10/03/22
11/27/23
12/11/23
10/01/22
10/05/22
11/01/22
02/22/23
01/24/25
10/01/22
01/11/23
10/01/22
02/01/23
09/20/23
02/28/25
01/31/25
07/29/25
10/21/22
10/01/22
Terms
End Interest
Date Rate
11/14/25
10/05/27
03/23/28
09/30/26
06/01/28
01/10/28
10/02/25
10/31/30
12/10/25
11/30/25
10/31/25
10/31/25
02/21/26
01/23/28
10/31/25
01/10/33
10/31/26
03/31/26
09/19/26
02/28/28
01/29/30
07/28/28
10/20/27
06/30/26
3.2380%
3.3050%
0.0000%
2.3630%
3.1440%
2.8720%
3.2380%
3.5300%
3.7420%
3.2380%
3.2380%
3.2380%
2.6560%
0.0000%
3.2380%
2.8530%
3.2690%
2.6560%
2.9010%
3.1440
3.1440
3.1440
3.3050%
3.2690%
SBITA Liability
Original Outstanding
Amount Balance
$ 28,168
865,202
547,004
155,788
230,173
372,466
117,758
411,971
290,328
59,127
1,636,485
1,246,707
140,691
534,404
116,461
1,000,570
81,406
809,753
49,892
14,845
46,206
233,320
745,078
312,966
$ 10,046,769
$
353,525
364,669
47,405
151,062
246,146
349,619
96,393
415,428
356,270
709,128
21,871
227,297
9,768
36,384
153,141
285,208
82,116
$ 3,905,430
Asset
Value
$ 28,168
865,202
547,004
169,828
230,173
372,466
119,257
411,971
290,328
59,127
1,636,485
1,246,707
140,691
534,404
136,261
1,000,570
81,406
809,753
49,892
14,845
46,206
233,320
745,078
333,966
$ 10,103,108
Subscription Asset
Accumulated
Amortization
$ (27,020)
(517,683)
(94,713)
(120,122)
(25,362)
(89,929)
(119,036)
(109,683)
(262,102)
(56,015)
(1,592,095)
(1,212,076)
(122,323)
(122,220)
(132,579)
(272,377)
(59,808)
(681,897)
(33,769)
(2,903)
(6,186)
(13,394)
(438,768)
(267,173)-
$ (6,79,233)
Net
Asset
$ 1,148
347,519
452,291
49,706
204,811
282,537
221
302,288
28,226
3,112
44,390
34,631
18,368
412,184
3,682
728,193
21,598
127,856
16,123
11,942
40,020
219,926
306,310
66,793
$ 3,723,875
All amounts paid were previously included in the measurement of the subscription liability and there were no other related
outflows of resources for the period such as variable payments or termination penalties. In addition, there were no
commitments incurred prior to commencement of any SBITA term and there were no impairment losses related to SBITA
assets.
The future principal and interest SBITA payments as of September 30, 2025, were as follows:
Fiscal
Year
2026
2027
2028
2029
2030
2031- 2035
Principal
$ 2,007,836
1,141,278
177,410
182,972
178,887
217,047
$ 3,905,430
$
$
Interest
99,383
47,815
23,101
17,540
11,803
9,332
208,974
$
$
Total
2,047,628
1,444,100
525,975
190,690
190,690
417,068
4,816,151
58 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 6 — Interfund Transactions
A summary of interfund transfers, the purpose of which is to cover operational expenses/expenditures, for the year ended
September 30, 2025, is as follows:
General Fund
Debt Service Fund
Capital Projects Fund
Pearland Economic Development Corporation
Tax Increment Reinvestment Zone #2
Development Authority of Pearland
Non -major Governmental Funds
Water and Sewer Fund
Internal Service Fund
Transfers In
$ 6,995,692
19,362,029
6,400,801
29,709,430
4,099,626
96,812,823
4,353,726
$ 167,734,127
Transfers Out
$ (7,641,263)
(2,651,133)
(5,959,201)
(29,709,430)
(16,750,302)
(655,592)
(104,367,206)
$ (167,734,127)
A summary of interfund balances, the purpose of which is to make payments for expenditures/expenses from a pooled
operating bank account in the general fund, as of September 30, 2025, is as follows:
General Fund
Non -major Governmental Funds
Due From
Other Funds
$ 8,266,504
$ 8,266,504
Due To
Other Funds
8,266,504
$ 8,266,504
59 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 7 - Leases Receivable
Governmental Activities
Lessor activity for the current year and future maturities for the City's Governmental Activities for the current year is as
follows:
Lease Receivable
Cell tower leases:
T -Mobile
Clear wireless
Natatorium
Total Lease Receivable
Deferred Inflow of Resources
Cell tower leases:
T -Mobile
Clear wireless
Natatorium
Total Deferred Inflow of Resources
Fiscal
Year
2026
2027
2028
2029
2030
2030 - 2034
2035 - 2039
2040 - 2044
$
$
Beginning
Balance Additions
$ 784,723 $
903,665
119,246
$ 1,807,634 $
Ending
Reductions Balance
- $ (30,053) $ 754,670
- (61,238) 842,427
- (119,246)
- $ (210,537) $ 1,597,097
Beginning
Balance Additions
$ 746,412 $
836,099
213,286
$ 1,795,797 $
Principal
Payments
62,688
65,272
67,938
70,689
73,527
413,454
499,137
344,392
1,597,097
Interest
Payments
$ 10,069
9,668
9,250
8,815
8,362
34,347
19,987
4,167
$ 104,665
Ending
Reductions Balance
- $ (40,686) $ 705,726
- (41,455) 794,644
- (119,228) 94,058
- $ (201,369) $ 1,594,428
$
$
Total
Payments
72,757
74,940
77,188
79,504
81,889
447,801
519,124
348,559
1,701,762
60 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 8 — Fund Balance/Net Position
Fund Balance Restrictions, Commitments, and Assignments
The City has classified ending fund balance based on the availability of funds for expenditure on programs and services. As of
September 30, 2025, the following balances were restricted, committed, or assigned in the governmental fund balances:
Restricted
Debt service
Capital projects
Tourism
Public safety
Community development
Grants
Economic development
Total Restricted Fund Balance
Committed
Capital projects
Total Committed Fund Balance
Assigned
Public works
Grants
Total Assigned Fund Balance
Net Position Restricted for Debt Service
$ 4,239,170
98,111, 853
9,236,516
686,510
4,678,839
106,869
75,075,927
$ 192,135,684
$ 4,278,790
$ 4,278,790
$ 1,016,522
240,936
$ 1,257,458
Net position restricted for debt service as of September 30, 2025 consisted of the following:
Cash restricted for debt service
Plus recognition of unavailable revenue:
l&S property taxes
UHCL receivable
Less: accrued interest payable
Restricted for Debt Service
Governmental Business -type
Activities Activities
$ 4,239,170 $ 14,558,316
911,057 -
2,408,485 -
(1,817,078) (1,709,294)
$ 5,741,634 $ 12,849,022
61 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Net Investment in Capital Assets
Net investment in capital assets as of September 30, 2025 consisted of the following:
Capital assets, net
Less:
Bonds payable
Unamortized premium
Leases, SBITAs, and financed purchases
Other capital -related liabilities (retainage)
Plus:
Deferred charge on refunding
Unspent bond proceeds
Fund Balance/Net Position Deficits
Governmental
Activities
$ 962,608,425
(426,435,000)
(23,108,723)
(4,841,903)
19,256,063
1,818,820
78,103,190
$ 607,400,872
The following funds reported deficit fund balances/net position as of September 30, 2025:
Nonmajor Governmental Funds:
CDBG Grant Fund
CDBG Disaster Recovery Fund
Disaster Recovery Fund
Hazard Mitigation Fund
U of H Fund
$ 215,387
2,365,813
4,356,162
1,046,848
27,299
Enterprise Funds:
Solid Waste Fund 198,970
Note 9 — Deferred Compensation Plan
Business -type
Activities
$ 684,937,995
(614,375,000)
(19,039,065)
(7,612,371)
548,632
89,588,022
$ 134,048,213
The City maintains, for its employees, a tax -deferred compensation plan meeting the requirements of Internal Revenue Code
Section 457. The plan was established in the 1995 fiscal year by City Ordinance, and MissionSquare Retirement is the plan
record keeper. The deferred compensation is not available to employees until termination, retirement, death, or unforeseen
emergency. The plan's trust arrangements are established to protect deferred compensation amounts of employees under
the plan from any other use other than intended under the plan (eventual payment to employees deferring the
compensation) in accordance with federal tax laws. Amounts of compensation deferred by employees under plan provisions
are disbursed bi-weekly by the City to a third -party administrator. The City does not contribute to the plan. The third -party
administrator handles all funds in the plan and makes investment decisions and disburses funds to employees in accordance
with plan provisions.
62 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 10 — Employee Retirement System
Texas Municipal Retirement System
Plan Description and Provisions
The City participates as one of 934 plans in the nontraditional, joint contributory, hybrid defined benefit pension plan
administered by the Texas Municipal Retirement System (TMRS). TMRS is an agency created by the State of Texas and
administered in accordance with the TMRS Act, Subtitle G, Title 8, Texas Government Code (the TMRS Act) as an agent
multiple -employer retirement system for municipal employees in the State of Texas. The TMRS Act places the general
administration and management of the System with a six -member Board of Trustees. Although the Governor, with the advice
and consent of the Senate, appoints the Board, TMRS is not fiscally dependent on the State of Texas. TMRS's defined benefit
pension plan is a tax -qualified plan under Section 401 (a) of the Internal Revenue Code. TMRS issues a publicly available
annual comprehensive financial report that can be obtained at www.tmrs.com. All eligible employees of the City are required
to participate in TMRS.
Benefits Provided
TMRS provides retirement, disability, and death benefits. Benefit provisions are adopted by the governing body of the City,
within the options available in the state statutes governing TMRS. At retirement, the benefit is calculated as if the sum of the
employee's contributions, with interest, and the City -financed monetary credits with interest were used to purchase an
annuity. Members may choose to receive their retirement benefit in one of seven actuarially equivalent payments options.
Members may also choose to receive a portion of their benefit as a partial lump -sum distribution in an amount equal to 12,
24, or 36 monthly payments, which cannot exceed 75 percent of the member's deposits and interest. At the date the plan
began, the City granted monetary credits for service rendered before the plan began of a theoretical amount equal to two
times what would have been contributed by the employee, with interest, prior to establishment of the plan. Monetary credits
for service since the plan began are 200 percent of the employee's accumulated contributions. A summary of plan provisions
for the City are as follows:
Employee deposit rate
Matching ratio (City to employee)
Years required for vesting
Service requirement eligibility
(expressed as age/years of service)
Updated service credit
Annuity increase (to retirees)
7.00%
2 to 1
5
60/5, 0/20
100% Repeating,
Transfers
70% of CPI Repeating
At the December 31, 2024, valuation and measurement date, the following employees were covered by the benefit terms:
Inactive employees or beneficiaries currently receiving benefits
Inactive employees entitled to but not yet receiving benefits
Active employees
Total
362
549
816
1,727
63 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Contributions
The contribution rates for employees in TMRS are either 5 percent, 6 percent, or 7 percent of employee gross earnings, and
the City matching percentages are either 100 percent, 150 percent, or 200 percent, both as adopted by the governing body
of the City. Under the state law governing TMRS, the contribution rate for each City is determined annually by the consulting
actuary, using the Entry Age Normal (EAN) actuarial cost method. The actuarially determined rate is the estimated amount
necessary to finance the cost of benefits earned by employees during the year, with an additional amount to finance any
unfunded accrued liability.
Employees for the City were required to contribute 7 percent of their annual gross earnings during the fiscal year. For fiscal
year 2025, the City's contribution rate was 13.44% for the months in 2024 and 14.44% for the months in 2025. The City's
contributions to TMRS for the year ended September 30, 2025, were $10,921,927 and were equal to the required
contributions.
Net Pension Liability
The City's Net Pension Liability (NPL) was measured as of December 31, 2024, and the Total Pension Liability (TPL) used to
calculate the Net Pension Liability was determined by an actuarial valuation as of that date.
Actuarial Assumptions
The Total Pension Liability in the December 31, 2024, actuarial valuation was determined using the following actuarial
assumptions:
Actuarial Cost Method
Amortization Method
Remaining Amortization Period
Asset Valuation Method
Inflation
Salary Increases
Investment Rate of Return
Retirement Age
Mortality
Entry Age Normal
Level Percentage of Payroll, Closed
21 years (longest amortization ladder)
10 Year smoothed market; 12% soft corridor
2.50%
3.60% to 11.85% including inflation
6.75%
Experience -based table of rates that vary by age. Last updated for the
2023 valuation pursuant to an experience study of the period ending
2022.
Post -retirement: 2019 Municipal Retirees of Texas Mortality Tables.
Male rates are multiplied by 103% and female rates are multiplied by
105%. The rates are projected on a fully generational basis by the
most recent Scale MP -2021 (with immediate convergence).
Pre -retirement: PUB(10) mortality tables, with the 110% of the Public
Safety table used for males and the 100% of the General Employee
table used for females. The rates are projected on a fully generational
basis by the most recent Scale MP -2021 (with immediate
convergence).
64 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Actuarial Assumptions
The long-term expected rate of return on pension plan investments was determined using a building-block method in which
best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and
inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of
return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected
inflation. The target allocation and best estimates of real rates of return for each major asset class are summarized in the
following table.
Asset Class
Global public equity
Core fixed income
Non -core fixed income
Hedge funds
Private equity
Prviate debt
Real estate
Infrastructure
Other private markets
Total
Discount Rate
Target Allocation
35.0%
6.0%
6.0%
5.0%
13.0%
13.0%
12.0%
6.0%
4.0%
100.0%
Long -Term Expected Real Rate of
Return (Arithmetic)
7.10%
5.00%
6.80%
6.40%
8.50%
8.20%
6.70%
6.00%
7.30%
The discount rate used to measure the Total Pension Liability was 6.75 percent. The projection of cash flows used to
determine the discount rate assumed that employee and employer contributions will be made at the rates specified in
statute. Based on that assumption, the pension plan's Fiduciary Net Position was projected to be available to make all
projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate of return
on pension plan investments was applied to all periods of projected benefit payments to determine the Total Pension Liability.
Changes in the Net Pension Liability
Balance at January 1, 2024
Changes for the year:
Service cost
Interest
Difference between expected and
actual experience
Contributions - employer
Contributions - employee
Net investment income
Benefit payments, including refunds,
of employee contributions
Administrative expense
Other
Net changes
Balance at December 31, 2024
Plan Fiduciary NPL
TPL (a) Net Position (b) (a) - (b)
$ 254,070,272 $ 218,311,068 $ 35,759,204
12,805,534 12,805,534
17, 311, 902 17, 311, 902
2,317,689 2,317,689
9,707,069 (9,707,069)
5,055,767 (5,055,767)
22,746,834 (22,746,834)
(8,000,834) (8,000,834) -
(145,478) 145,478
(3,404) 3,404
24,434,291 29,359,954 (4,925,663)
$ 278,504,563 $ 247,671,022 $ 30,833,541
65 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The following presents the net pension liability of the City, calculated using the discount rate of 6.75 percent, as well as what
the City's net pension liability would be if it were calculated using a discount rate that is 1 -percentage -point lower (5.75
percent) or 1 -percentage -point higher (7.75 percent) than the current rate.
Current Single Rate
1% Decrease Assumption 1% Increase
(5.75%) (6.75%) (7.75%)
Net Pension Liability (Asset) $ 77,390,242 $ 30,833,541 $ (6,713,671)
Pension Plan Fiduciary Net Position
Detailed information about the pension plan's Fiduciary Net Position is available in a separately issued TMRS financial report.
That report may be obtained at tmrs.com.
Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
For the year ended September 30, 2025, the City recognized pension expense of $12,460,754.
At September 30, 2025, the City reported deferred outflows and inflows of resources related to pensions from the following
sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Differences between actuarial assumptions
and actual experience
Changes in actuarial assumptions
Differences between projected and actual
pension plan investment earnings
Contributions subsequent to the
measurement date
Total
$ 5,712,492 $
(703,287)
(2,943,921)
8,118,737 -
$ 13,831,229 $ (3,647,208)
Deferred outflows of resources related to pensions resulting from contributions subsequent to the measurement date will
be recognized as a reduction of the net pension liability in the fiscal year subsequent to 2025. Other amounts reported as
deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows:
Fiscal Year
2026
2027
2028
2029
Total
2,051,053
3,858,420
(2,539,937)
(1,304,252)
2,065,284
66 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 11— Other Post -Employment Benefits (OPEB)
The City offers two other postemployment benefit (OPEB) plans; the Retiree Health Care Plan and the TMRS-Supplemental
Death Benefits Fund as discussed below. OPEB items for the two plans are as follows:
TMRS -
Supplemental
Death Benefits Retiree Health
Fund Care Plan Total
Total OBEB Liability $ 1,645,319 $ 5,388,724 $ 7,034,043
Deferred Outflows of Resources 257,725 476,673 734,398
Deferred Inflows of Resources (649,560) (1,918,258) (2,567,818)
OPEB expense 77,542 365,219 442,761
TMRS Supplemental Death Benefits Fund
Benefit Plan Description
The City also participates in the single -employer defined benefit group -term life insurance plan operated by the Texas
Municipal Retirement System (TMRS) known as the Supplemental Death Benefits Fund (SDBF). The City elected, by ordinance,
to provide group -term life insurance coverage to both current and retired employees. The City may terminate coverage under
and discontinue participation in the SDBF by adopting an ordinance before November 1 of any year to be effective the
following January 1. No assets are accumulated in a trust that meets the criteria of paragraph 4 of GASB Statement No 75.
The death benefit for active employees provides a lump -sum payment approximately equal to the employee's annual salary
(calculated based on the employee's actual earnings, for the 12 -month period preceding the month of death); retired
employees are insured for $7,500; this coverage is OPEB. As the SDBF covers both active and retiree participants, with no
segregation of assets, the SDBF is considered to be an unfunded OPEB plan (i.e. no assets are accumulated).
Membership in the plan as of the measurement date of December 31, 2024 was as follows:
Inactive employees currently receiving benefits 267
Inactive employees entitled to but not yet receiving benefits 151
Active Employees 816
1,234
Contributions
Contributions are made monthly based on the covered payroll of employee members of the participating member city. The
contractually required contribution rate is determined annually for each city (currently 0.19% of covered payroll and 0.05%
for the retiree -only portion). The rate is based on the mortality and service experience of all employees covered by the SDBF
and the demographics specific to the workforce of the City. There is a one-year delay between the actuarial valuation that
serves as the basis for the employer contribution rate and the calendar year when the rate goes into effect. The funding policy
of this plan is to assure that adequate resources are available to meet all death benefit payments for the upcoming year; the
intent is not to prefund retiree term life insurance during employees' entire careers. As such, contributions are utilized to
fund active member deaths on a pay-as-you-go basis; any excess contributions and investment income over payments then
become net position available for benefits.
67 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Discount Rate
The TMRS SDBF program is treated as unfunded OPEB plan because the SDBF trust covers both active employees and retirees
and the assets are not segregated for these groups. Under GASB Statement No. 75, the discount rate for an unfunded OPEB
plan should be based on 20 -year tax-exempt AA or higher Municipal Bonds. Therefore, a discount rate of 4.08% based on the
20 -Year Municipal GO AA Index rate published by bondbuyer.com is used as of the measurement date of December 31, 2024.
Actuarial Assumptions
The City's total OPEB liability was measured at December 31, 2024, and was determined by an actuarial valuation as of that
date using the following actuarial assumptions.
Valuation Date: December 31, 2024
Methods and Assumptions:
Inflation 2.50%
Salary Increases 3.60% to 11.85%, including inflation
Discount rate* 4.08%
Retirees' share of benefit related costs $0
Administrative expenses All administrative expenses are paid through the
Pension Trust and accounted for under reporting
requirements under GASB Statement No. 68.
Mortality rates - services retirees 2019 Municipal Retirees of Texas Mortality Tables.
Male rates are multiplied by 103% and female rates are
multiplied by 105%. The rates are projected on a fully
generational basis by the most recent Scale MP -2021
(with immediate convergence).
Mortality rates - disabled retirees
2019 Municipal Retirees of Texas Mortality Tables with
a 4 year set forward for males and a 3 year set -forward
for females. In addition, a 3.5% and 3% minimum
mortality rate will be applied to reflect the impairment
for younger members who become disabled for males
and females, respectively. The rates are projected on a
fully generational basis by the most recent Scale MP -
2021 (with immediate convergence) to account for
future mortality improvements subject to the floor.
* The discount rate was based on the Bond Buyer "20 -Bond GO Index" rate closest to,
but not later than, December 31, 2024.
Other Information
The actuarial assumptions used in the December 31, 2024, valuation were based on the results of an actuarial experience
study for the period ending December 31, 2024.
68 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Changes in the Total OPEB Liability
Balance at January 1, 2024
Changes for the year:
Service cost
Interest on total OPEB liability
Differences between expected and
actual experience
Change of assumptions
Benefit payments
Balance at December 31, 2024
Sensitivity Analysis
Total OPEB
Liability
$ 1,660,922
86,670
63,570
(31,178)
(98,552)
(36,113)
$ 1,645,319
The following presents the total OPEB liability of the employer, calculated using the discount rate of 4.08%, as well as what
the City's total OPEB liability would be if it were calculated using a discount rate that is 1 -percentage -point lower or 1 -
percentage -point higher than the current rate. Note that the healthcare cost trend rate does not affect the total OPEB liability,
so sensitivity to the healthcare cost trend rate is not shown.
1% Decrease in
Discount
Rate (3.08%)
Total OPEB Liability $ 1,993,772
Current
Discount
Rate (4.08%)
$ 1,645,319
1% Increase in
Discount
Rate (5.08%)
$ 1,375,693
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB Activity
For the year ended September 30, 2025, the City recognized OPEB expense of $88,263. As of September 30, 2025, the City
reported deferred outflows of resources related to OPEB from the following sources:
Difference between expected and actual experience
Changes of assumptions
Contributions subsequent to measurement date
Total
Deferred
Outflows of
Resources
$ 20,867
208,746
28,112
$ 257,725
Deferred
Inflows of
Resources
$ (83,418)
(566,142)
$ (649,560)
69 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The deferred outflows of resources related to OPEB resulting from City contributions subsequent to the measurement date
will be recognized as a reduction of the total OPEB liability in the fiscal year subsequent to fiscal year 2025. Amounts currently
reported as deferred outflows and deferred inflows of resources related to OPEB, excluding contributions subsequent to the
measurement date, will be recognized in OPEB expense as follows.
Fiscal Year
2026 $ (80,571)
2027 (94,881)
2028 (128,458)
2029 (95,763)
2030 (14,894)
Thereafter (5,380)
Total $ (419,947)
Retiree Health Care Plan (RHCP)
Plan Description
The City's defined benefit OPEB plan, City of Pearland Retiree Health Care Plan (RHCP), provides OPEB through an implicit
healthcare premium for retirees for all permanent full-time employees of the City. RHCP is a single -employer defined benefit
OPEB plan administered by the City. At this time, no assets are accumulated in a trust to fund the future requirements of the
RHCP.
Benefits Provided
Retirees who are entitled to receive retirement benefits under the City's retirement plan may purchase continued health
benefits coverage for the retiree and the retiree's dependents, but shall pay 100 percent of the premium for coverage. The
retiree, however, is able to receive a lower rate by participating in the City's plan as opposed to individually purchasing health
insurance. The City's coverage is secondary to Medicare when the person becomes eligible for these benefits.
Employees covered by benefit terms. At October 1, 2023, the actuarial valuation date, the following employees were covered
by the benefit terms:
Inactive employees currently receiving benefits
Inactive employees entitled to but not yet receiving benefits
Active Employees
Total
12
777
789
70 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Actuarial Assumptions and Methods
The City's total OPEB liability was measured as of September 30, 2025, and was determined by an actuarial valuation as of
October 1, 2023. The total OPEB liability was determined using the following actuarial assumptions, applied to all periods
included in the measurement, unless otherwise specified:
Valuation Date
Methods and Assumptions:
Measurement Date
Actuarial Cost Method
Amortization period (in years)
Amortization method
Discount Rate*
Salary Increases*
Healthcare cost trends rates*
October 1, 2023
September 30, 2025
Entry Age Normal as a level percentage of salary
The expected remaining service of all employees eligible for or currently
receiving OPEB through the OPEB plan.
Straight line amortization
4.90% per annum
3.00% per annum
6.21% initial medical trend rate for retirees decreasing to an ultimate rate of
4.14% in the year 2042
* An embedded inflation rate of 2.50% is included in these rates.
Discount Rate
The discount rate of 4.90% is based upon the yield of 20 -year tax-exempt general obligation municipal bonds with an average
rating of AA/Aa or higher. The other financial assumptions for long-term inflation, payroll growth, and salary scale were taken
from the TMRS actuary study. The per capita claims costs and how these costs are expected to escalate in the future were
set by HUB International who develops the funding rates.
Plan Assets
There are no plan assets accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.
Changes in the Total OPEB Liability
The retiree medical plan sponsored by the City is offered to all former employees who satisfy the retirement eligibility
provisions of the plan, however only those employees who retire after September 30, 2018 may be eligible for a City subsidy.
The following table shows the changes in total OPEB liability:
Balance at October 1, 2024
Changes for the year:
Service cost
Interest on total OPEB liability
Change of assumptions
Benefit payments
Balance at September 30, 2025
Assumption Changes. The discount rate decreased from 4.06% to 4.90%.
Total OPEB
Liability
$ 5,185,879
356,512
269,161
(324,190)
(98,638)
$ 5,388,724
71 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Sensitivity of the Total OPEB Liability to Changes in the Discount Rate
The following presents the plan's total OPEB liability, calculated using the discount rate, as well as what the plan's total OPEB
liability would be if it were calculated using a discount rate that is 1 -percentage -point lower or 1 -percentage -point higher
than the current rate:
Current Discount Rate
1% Decrease in Discount Assumption 1% Increase in Discount
Rate (3.90%) (4.90%) Rate (590%)
Total OPEB Liability $ 6,147,851 $ 5,388,724 $ 4,987,688
Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates
The following presents the plan's total OPEB liability, calculated using the assumed trend rates as well as what the plan's total
OPEB liability would be if it were calculated using a trend rate that is 1 -percentage -point lower or 1 -percentage -point higher
than the current healthcare cost trend rate:
Total OPEB Liability $
Current
Healthcare Cost
1% Decrease Trend Rates Assumption 1% Increase
(5.21%) (6.21%) (7.21%)
4,599,229 $ 5,388,724 $ 6,415,042
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
For the year ended September 30, 2025, the City recognized OPEB expense of $365,219. At September 30, 2025, the City
reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:
Differences between expected and actual experience
Changes assumptions
Deferred Deferred
Outflows of Inflows of
Resources Resources
$ 63,173 $ (24,829)
413,500 (1,893,429)
$ 476,673 $ (1,918,258)
Amounts currently reported as deferred outflows and inflows of resources related to OPEB will be recognized in OPEB
expense as follows.
Fiscal Year
2026 $ (274,905)
2027 (274,905)
2028 (274,905)
2029 (404,456)
2030 (109, 649)
Thereafter (102,765)
Total $ (1,441,585)
72 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 12 — Commitments and Contingencies
Litigation and Other Contingencies
The City was involved in various lawsuits and arbitration proceedings at September 30, 2025. The City and its legal counsel
believe that any amounts which the City might ultimately be required to pay will not exceed underlying insurance coverage.
Reimbursements Due to Developers/Business Assistance
Pursuant to the Local Government Code, the Economic Development Corporation offers incentives to attract and retain
businesses to the City. The following are the current incentives:
Brask
Burns & McDonnell
Crain Group
JASH USA/Rodney Hunt
Millar Inc.
Rollac Shutter of Texas
SolvChem
Syzygy Plasmonics
United Imaging
Amounts Paid
Original Amount Prior Years Current Year Amendments Balance
$ 419,500 $ - $ - $ - $ 419,500
180,000 - 180,000
300,000 - 300,000
500,000 - 500,000
975,500 683,000 - 292,500
195,000 - 195,000
530,500 - 530,500
565,000 434,500 - 130,500
550,000 - 550,000
$ 4,215,500 $ 1,117,500 $ - $ - $ 3,098,000
Regular amendments are made to these agreements over time. Only agreements for which payments were received during
the fiscal year or a balance existed as of September 30, 2025 are listed above.
Lower Kirby Urban Center Master Plan
One of the strategies of the Pearland Prosperity Strategic Plan is to implement plans to develop the Lower Kirby Urban Center
as Pearland's most intensive mixed -use employment, residential, and entertainment district. The Lower Kirby Master Plan
identified $48 million in priority construction projects that include drainage, water, sewer, streets, traffic, sidewalks, and
streetscape necessary to facilitate development of the area. On March 10, 2014, the City entered into a Master Financing
Agreement with Lower Kirby Pearland Management District (LKMD) and Pearland Municipal Management District (PMMD
#1) which outlines the process for the City to advance funds to the District(s) in order to facilitate the development. The City
will be reimbursed from the District(s) from bond sales as the area is developed and the Districts' taxable values support bond
issuances. Each project is taken on a case by case basis and is approved via a Letter of Financing Agreement (LFA).
73 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
The following LFA's have been approved by and between the City and the LKMD and the PMMD #1. The City had receivable
balances at September 30, 2025 of $3,374,014 from the PMMD #1 and $3,937,168 from the LKMD.
Pearland Economic
Capital Development
Projects Fund Corporation
Pearland Municipal Management District #1
Detention Pond Acquisition
Detention Analysis
Detention Phasing Plan
LK PER Phase 1
TxDOT Ditch Acquisition
West Conveyance Pond
South Spectrum PER
South Spectrum West
LK Regional Detention Property Acquisition
Total Pearland Municipal Management District #1
Lower Kirby Pearland Management District
LK Park Improvements
LK Regional Detention Acquisition PH 2
LK Labrador Rd & Beltway 8 Waterline
LK Furge Rd ROW Acquisition
Total Lower Kirby Pearland Management District
Total LFA Receivables
1,000,000
1,000,000
539,528
34,276
4,992
43,717
128,508
154,279
86,124
1,228,377
154,213
2,374,014
1,000,000
1,257,168
1,600,000
80,000
3,937,168
$ 1,000,000 $ 6,311,182
City funding for these LFAs is via Reimbursement Agreements with the Pearland Economic Development Corporation,
whereby the City gets reimbursed for the cost of these projects by the Corporation; so that the City is not actually out any
dollars.
74 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
Note 13 — Risk Management
The City is exposed to various risks of loss related to torts: theft of, damage to, and destruction of assets; errors and omissions;
injuries to employees; and natural disasters. The City's risk management program mainly encompasses obtaining property
and liability insurance through Texas Municipal League's Intergovernmental Risk -Pool (TML-IRP), and through commercial
insurance carriers. The participation of the City in TML-IRP is limited to payment of premiums. The City has not had any
significant reduction in insurance coverage, and the amounts of insurance settlements have not exceeded insurance coverage
for any of the last three years.
The City also provides Workers' Compensation insurance on its employees through TML-Workers' Compensation Fund.
Workers' Compensation premiums are subject to change when audited by TML Workers' Compensation Fund. At the end of
fiscal year 2025, the City believed the amounts paid on Workers' Compensation would not change significantly from the
amounts recorded.
The City uses the Property Liability Insurance Internal Service Fund to account for the activities of the City's property and
casualty insurance. Coverage includes general liability, law enforcement, public official and employees' liability, auto liability,
physical damage and multi -peril, mobile equipment, real and personal property, and windstorm coverage. The fund accounts
for the annual premiums and accounts for insurance recovery funds on eligible claims.
The City uses the Health Claims Fund, a medical self-insurance fund, to account for and finance the City's employee health
insurance medical claims. The fund accounts for employee, City, retiree and COBRA contributions, claims and administrative
fees.
Changes in the balance of claims liabilities as reported in the Health Claims Fund (an Internal Service Fund) during the current
and past two years are as follows:
Year Ended September 30,
2023 2024 2025
Beginning Liability $ 527,892 $ 362,526 $ 386,085
Claims incurred 8,025,584 9,060,190 10,600,975
Claims payments (8,190,950) (9,036,631) (11,148,566)
Ending Liability $ 362,526 $ 386,085 $ (161,506)
75 City of Pearland, Texas 2025 ACFR
76 City of Pearland, Texas 2025 ACFR
REQUIRED SUPPLEMENTARY INFORMATION
(UNAUDITED)
77 City of Pearland, Texas 2025 ACFR
78 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
GENERAL FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Property taxes
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Total Expenditures
$ 45,520,000 $ 45,794,387 $ 43,218,171 $ (2,576,216) $ 40,946,317
31,226,000 31,640,887 32,208,512 567,625 31,014,354
6,729,055 6,886,806 7,339,412 452,606 7,037,329
3,051,871 3,312,893 4,233,596 920,703 3,486,738
1,990,185 2,195,409 2,257,800 62,391 2,095,237
23,810,336 24,804,759 26,357,807 1,553,048 24,998,098
4,593,276 4,111,133 3,688,619 (422,514) 2,621,790
1,158,572 1,418,744 260,172
471,870 247,103 471,327 224,224 1,208,705
117, 392,593 120,151,949 121,193,988 1,042,039 113,408,568
11,347,873
74,899,457
14,471,638
5,299,717
9,897,715
1,164,551
117,080,951
Excess (Deficiency) of Revenues
Over Expenditures 311,642
12,690,711
76,371,521
13, 615,441
5,514,048
10,145,688
124,002
7,999
2,407,773
120,877,183
13,324,859
77,017,633
12,395,001
5,282,856
9,743,621
281,668
71,709
1,137,870
119, 255, 217
(725,234) 1,938,771
(634,148) 9,816,585
(646,112) 69,696,027
1,220,440 11,665,483
231,192 4,782,140
402,067 8,330,421
(157,666) 270,158
(63,710) 77,711
1,269,903 2,014,364
1,621,966 106, 652, 889
2,664,005 6,755,679
Other Financing Sources (Uses)
Transfers in 6,995,692 6,995,692 6,995,692 - 4,369,155
Transfers out (5,985,421) (8,641,263) (7,641,263) 1,000,000 (8,935,988)
Issuance of debt - financing arrangement - - 1,485,812
Sale of general capital assets 23,000 297,317 308,280 10,963 26,362
Total Other Financing Sources (Uses) 1,033,271 (1,348,254) (337,291) 1,010,963 (3,054,659)
Net Change in Fund Balances 1,344,913 (2,073,488) 1,601,480 3,674,968 3,701,020
Fund Balances - Beginning
Fund Balances - Ending
35,024,604 35,024,604 35,024,604 - 31,323,584
$ 36,369,517 $ 32,951,116 $ 36,626,084 $ 3,674,968 $ 35,024,604
79 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
PEARLAND ECONOMIC DEVELOPMENT CORPORATION
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Sales and use taxes
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
Economic development
Debt Service:
Principal
Interest and other charges
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Sale of general capital assets
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original Final
Budget Budget
Variance with
Actual Final Budget 2024
$ 15,457,502 $ 15,843,939 $ 15,888,222 $ 44,283 $ 15,301,040
1,120,175 1,800,000 1,805,335 5,335 2,081,390
12,000 12,000 9,000 (3,000) 15,000
10,000 10,000 113,110 103,110 18,591
16,599,677 17, 665,939 17,815,667 149,728 17,416,021
5,393,603 4,936,534
250,000 250,000
11,800 11,800
4,135,305 2,760,305
9,790,708 7,958,639
6,808,969 9,707,300
2,765,000
(32,886,989) (12,872,870)
(32,886,989) (10,107,870)
(26,078,020) (400,570)
3,538,241 1,398,293 4,271,209
250,000 - 250,000
11,800 - 17,700
827,980 1,932,325 2,101,351
4,628,021 3,330,618 6,640,260
13,187,646 3,480,346 10,775,761
(5,959,201)
247,537
(5,711,664)
7,475,982
39,562,483 39,562,483 39,562,483
$ 13,484,463 $ 39,161,913 $ 47,038,465 $
(2,765,000)
6,913,669
247,537
4,396,206
(5,856,580)
(5,856,580)
7,876,552 4,919,181
34,643,302
7,876,552 $ 39,562,483
80 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY BUDGET INFORMATION
For the Year Ended September 30, 2025
Budgetary Compliance
The City has complied with all material budget requirements for the year ended September 30, 2025.
Annual appropriated budgets are adopted for the General, Special Revenue and Debt Service Funds, using the same basis of
accounting as for financial reporting. All annual appropriations lapse at the end of the fiscal year. Project length budgets are
adopted for the Capital Project Funds. The City, for management control, approves a financial plan for the Enterprise Fund.
The City does not legally adopt an annual appropriated budget for the Development Authority of Pearland or TIRZ #2.
Expenditures may not legally exceed budgeted appropriations at the fund level (i.e. General Fund, Debt Service Fund, etc.).
Expenditure requests, which would require an increase in total budgeted appropriations, must be approved by City Council
through a formal budget amendment. At any time in the fiscal year, the Council may make emergency appropriations to meet
a pressing need for public expenditure in order to protect the public health, safety, or welfare. The Council has the power to
transfer any unencumbered funds allocated by the budget from one activity, function, or department, to another activity,
function, or department, to re -estimate revenues and expenditures, and to amend the budget.
Because City Council adopts the budget at the fund level, management has the authority to transfer available funds allocated
by the budget from one function/department or activity to another function or activity within the same department. In
cooperation with the directors and department heads of the City, the Budget Officer, the Chief Financial Officer and the City
Manager prepare an annual budget for the General Fund, Special Revenue Funds and Debt Service Fund for the ensuing fiscal
year, in a form and style as deemed desirable by the City Manager. The City Manager shall submit to the Council, for its
review, consideration, and revision, both a letter describing the proposed new budget, as well as a balanced budget for the
forthcoming fiscal year, between 60 and 90 days prior to the beginning of the fiscal year. The budget, as adopted, must set
forth the appropriations for services, functions, and activities of the various City departments and agencies, and shall meet
all fund requirements provided by law and required by bond covenants. Capital projects are budgeted on a project -length
basis.
Amounts reported in the accompanying financial statements represent the budgeted amount with all supplemental
appropriations.
81 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS
Texas Municipal Retirement System
Last Ten Measurement Years
2015
Total Pension Liability
Service cost
Interest
Difference between expected
and actual experience
Change in assumptions
Benefit payments, including refunds of
employee contributions (3,808,062)
Net Change in Total Pension Liability 10,449,004
Total Pension Liability - Beginning 108,601,188
Total Pension Liability - Ending (a) $ 119,050,192
Plan Fiduciary Net Position:
Contributions - employer
Contributions - employee
Net investment income
Benefit payments, including refunds of
employee contributions
Administrative expense
Other
Net Change in Plan Fiduciary Net Position
Plan Fiduciary Net Position - Beginning
Plan Fiduciary Net Position - Ending (b)
Net Pension Liability - Ending (a) - (b)
Plan Fiduciary Net Position as a
Percentage of Total Pension Liability
Covered -Employee Payroll
Net Pension Liability as a Percentage
of Covered -Employee Payroll 66.22%
$ 6,035,636 $
7,679,417
2016 2017
2018
Measurement Year
2019 2020
2021
2022
2023
2024
2,317,689
(8,000,834)
24,434,291
254,070,272
278,504,563
9,707,069
5,055,767
22,746,834
(8,000,834)
(145,478)
(3,404)
29,359,954
218,311,068
247,671,022
30,833,541
88.93%
6,756,543 $ 7,548,267 $ 7,869,363 $ 8,361,735 $ 9,324,466 $ 9,811,113 $ 10,527,935 $ 11,255,589 $
846,833 1,159,738 33,887
(304,820)
Notes to the Required Supplementary Information
$ 4,786,602
2,498,961
135,758
(3,808,062)
(82,673)
(4,082)
3,526,504
91,984,661
95,511,165
$ 23,539,027
(2,875,256)
13,207,949
119,050,823
$ 132,258,772
$ 5,253,253
2,749,756
6,458,752
(2,875,256)
(72,899)
(3,927)
11,509,679
95,511,165
107,020,844
$ 25,237,928
80.23% 80.92%
(3,481,143)
13,165,744
132,258,772
$ 145,424,516
$ 5,991,467
3,081,580
14,836,941
(3,481,143)
(76,869)
(3,896)
20,348,080
107,020,843
127,368,923
$ 18,055,593
87.58%
41,404
(4,953,354)
12,871,983
145,424,516
$ 158,296,499
$ 6,225,163
3,216,353
(3,818,135)
(4,953,354)
(73,737)
(3,853)
592,437
127,368,923
127,961,360
$ 30,335,139
80.84%
249,817
952,323
(5,414,199)
14,934,169
158,296,499
$ 173,230,668 $
$ 6,543,589 $
3,439,022
19,805,631
(5,414,199)
(111,780)
(3,359)
24,258,904
127,961,360
152,220,264
$ 21,010,404 $
87.87%
847,255
(4,807,485)
17,209,754
173,230,668
190,440,422
7,258,507
3,866,781
11,569,310
(4,807,485)
(74,766)
(2,917)
17,809,430
152,220,264
170,029,694
20,410,728
89.28%
2,320,691
(5,978,894)
19,136,976
190,440,422
$ 209,577,398
$ 7,623,084
4,073,416
22,200,809
(5,978,894)
(102,560)
702
27,816,557
170,029,694
197,846,251
$ 11,731,147
94.40%
3,479,388
(6,347,455)
21,947,434
212,387,856
$ 234,335,290
$ 8,056,797
4,358,391
(14,471,304)
(6,347,455)
(124,973)
149,131
(8,379,413)
161,650,281
153,270,868
$ 81,064,422
65.41%
3,114,314
(1,196,823)
(6,418,808)
22,545,440
231,524,832
$ 254,070,272
$ 8,730,203
4,682,869
21,990,446
(6,418,808)
(139,505)
(975)
28,844,230
189,466,838
218,311,068
$ 35,759,204
85.93%
$ 35,545,557 $ 39,282,225 $ 44,013,221 $ 45,939,075 $ 49,128,879 $ 55,239,728 $ 58,191,657 $ 62,258,636 $ 66,878,131 $ 72,225,212
64.25% 41.02%
66.03%
42.77%
36.95%
20.16%
(a) Amounts presented are for each measurement year, which end the preceding December 31 of the City's fiscal year-end.
130.21%
53.47%
42.69%
82 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF CONTRIBUTIONS
Texas Municipal Retirement System
Last Ten Fiscal Years
Actuarially determined contribution
Contribution in relation of the actuarially
determined contribution
Contribution deficiency (excess)
Covered payroll
Contributions as a percentage of covered
payroll
Actuarially determined contribution
Contribution in relation of the actuarially
determined contribution
Contribution deficiency (excess)
Covered payroll
Contributions as a percentage of covered
payroll
Fiscal Year
2021 2022 2023 2024 2025
$ 7,545,831 $ 7,989,951 $ 8,669,461 $ 9,413,709 $ 10,921,927
7,545,831 7,989,951 8,669,461 9,413,709 10,921,927
$ - $ - $ $ - $ -
$ 57,237,508 $ 61,538,157 $ 65,580,842 $ 70,600,572 $ 77,081,009
13.18% 12.98% 13.22% 13.33% 14.17%
Fiscal Year
2016 2017 2018 2019 2020
$ 5,295,359 $ 5,924,405 $ 6,072,762 $ 6,461,150 $ 6,818,604
5,295,359 5,924,405 6,072,762 6,461,150 6,818,604
$ - $ - $ $ - $ -
$ 39,566,838 $ 43,703,166 $ 44,772,623 $ 48,297,918 $ 51,414,583
13.38% 13.56% 13.56% 13.38% 13.26%
83 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NOTES TO REQUIRED PENSION SYSTEM SUPPLEMENTARY INFORMATION
For the Year Ended September 30, 2025
Methods and Assumptions Used to Determine Contribution Rates:
Valuation Date:
Notes
Methods and Assumptions Used
Actuarial Cost Method
Amortization Method
Remaining Amortization Period
Asset Valuation Method
Inflation
Salary Increases
Investment Rate of Return
Retirement Age
Mortality
Other Information:
Notes:
Actuarial determined contribution rates are calculated as of
December 31 and become effective in January 13 months later.
to Determine Contribution Rates:
Entry Age Normal
Level Percentage of Payroll, Closed
22 years (longest amortization ladder)
10 Year smoothed market; 12% soft corridor
2.50%
3.60% to 11.85% including inflation
6.75%
Experience -based table of rates that vary by age. Last updated for
the 2023 valuation pursuant to an experience study of the period
ending 2022.
Post -retirement: 2019 Municipal Retirees of Texas Mortality Tables.
Male rates are multiplied by 103% and female rates are multiplied
by 105%. The rates are projected on a fully generational basis by
the most recent Scale MP -2021 (with immediate convergence).
Pre -retirement: PUB(10) mortality tables, with the 110% of the
Public Safety table used for males and the 100% of the General
Employee table used for females. The rates are projected on a fully
generational basis by the most recent Scale MP -2021 (with
immediate convergence).
There were no benefit changes during the year.
84 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS
Texas Municipal Retirement System Supplemental Death Benefits Fund
Last Eight Measurement Years
Total OPEB Liability
Service cost
Interest
Changes of benefit terms
Difference between expected
and actual experience
Changes of assumptions
Benefit payments, including refunds
of employee contributions
Net Change in Total OPEB Liability
Total OPEB Liability - Beginning
Total OPEB Liability - Ending
2017 2018
$ 66,020 $
39,025
111,349
(4,401)
211,993
1,001,605
$ 1,213,598
Covered Payroll $ 44,013,221
Total OPEB Liability as a Percentage
of Covered Payroll
2.76%
Notes to the Required Supplementary Information
2019
82,690 $ 73,693 $
41,463 52,362
143,594
(99,775)
(4,594)
163,378
1,213,598
$ 1,376,976
$ 45,939,075
3.00%
(224,466)
276,531
(4,913)
173,207
1,376,976
$ 1,550,183
Measurement Year
2020 2021
110,479 $ 139,660 $
44,073 40,441
(27,031)
291,685
(5,524)
413,682
1,550,183
$ 1,963,865
$ 49,128,879 $ 55,239,728
3.16%
3.56%
(35,262)
73,519
(23,277)
195,081
1,963,865
$ 2,158,946
2022 2023
149,421 $
40,870
30,912
(870,455)
(24,903)
(674,155)
2,158, 946
$ 1,484,791
$ 58,191,657 $ 62,258,636
3.71%
Amounts presented are for each measurement year, which end the preceding December 31 of the City's fiscal year-end.
Ten years of data should be presented in this schedule, but data was unavailable prior to 2017.
There are no plan assets accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.
2.38%
66,878 $
60,811
(4,088)
85,969
(33,439)
176,131
1,484,791
$ 1,660,922
$ 66,878,131
2.48%
$
$
2024
86,670
63,570
(31,178)
(98,552)
(36,113)
(15,603)
1,660,922
1,645,319
77,081,009
2.13%
85 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF CHANGES IN THE TOTAL OPEB LIABILITY AND RELATED RATIOS
City Of Pearland Retirement Health Care Plan
Last Eight Fiscal Years
Total OPEB Liability
Service cost
Interest
Changes of benefit terms
Difference between expected
and actual experience
Changes of assumptions
Benefit payments, including refunds
of employee contributions
Net change in total OPEB liability
Total OPEB Liability - Beginning
Total OPEB Liability - Ending
Covered -Employee Payroll
Total OPEB Liability as a Percentage
of Covered -Employee Payroll
2018
2019 2020
$ 456,161 $ 295,552 $
240,852 157,119
(2,314,150) -
361,831
43,043
(127,339)
(1,339,602)
5,266,971
$ 3,927,369
$ 44,772,623
8.77%
Notes to the Required Supplementary Information
Fiscal Year
2021 2022
364,519 $ 515,331 $
167,755 140,612
(74,479)
101,145 1,240,492
(66,167)
487,649
3,927,369
$ 4,415,018
(38,350)
1,659,937
4,415,018
$ 6,074,955
$ 48,297,918 $ 51,067,300
9.14%
11.90%
2023
531,977 $ 304,981 $
169,734 241,690
28,290
(203,273) (2,206,085)
(39,277)
413,393
6,074,955
$ 6,488,348
(127,324)
(1,603,408)
6,488,348
$ 4,884,940
$ 54,267,466 $ 62,799,942
11.96%
Ten years of data should be presented in this schedule, but data was unavailable prior to fiscal year 2018.
There are no plan assets accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.
7.78%
(55,038)
(246,107)
245,526
4,884,940
$ 5,130,466
$ 63,986,647
8.02%
2024 2025
346,970 $ 356,512
264,649 269,161
112,509
65,369
(517,028)
(217,056)
55,413
5,130,466
$ 5,185,879
$ 65,906,246
7.87%
(324,190)
(98,638)
202,845
5,185,879
$ 5,388,724
$ 78,161,719
6.89%
86 City of Pearland, Texas 2025 ACFR
OTHER SUPPLEMENTARY INFORMATION
87 City of Pearland, Texas 2025 ACFR
88 City of Pearland, Texas 2025 ACFR
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
89 City of Pearland, Texas 2025 ACFR
90 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Hotel/Motel Occupancy Tax Fund
A fund created to account for hotel/motel occupancy tax revenue.
Municipal Court Security Fund
A fund created to account for the receipt and expenditure of revenues from court fines for court security.
City Wide Donation Fund
A fund created to account for miscellaneous donations for all City departments except parks.
Court Technology Fund
This fund is used to account for the receipt and expenditure of revenues from court fines for court technology.
Street Assessment Fund
A fund created to account for the revenue and expenditure of street assessments as approved by City Council for a
designated street(s).
Park Donations Fund
A fund used to account for park donations for park special events and development of parks. This fund also includes
funds from tree trust donations.
Tree Trust Fund
Tree Trust Fund Ordinance 772 established to protect healthy trees, preserve the natural ecological environment and
aesthetic qualities of the City, and to protect and increase the value of residential and commercial properties within the
City. This fund is used to account for tree trust donations from developers who cannot mitigate for trees removed during
development; the fee is determined by a tree survey, based on how many caliper inches are mitigated.
Parks Financial Assistance Donations Fund
The Financial Assistance Program, funded by the Forever Parks Foundation, assists individuals who are financially unable
to participate in programs provided by the Parks & Recreation department.
Police State Seizure Fund
A fund created to account for state seizure funds which are used solely for law enforcement purposes.
Police Federal Seizure Fund
A fund created to account for federal seizure funds which are used solely for law enforcement purposes.
Community Safety Fund
The Community Safety grant was implemented in FY22 for Pearland communities to apply for funds to assist with
neighborhood safety.
Parks & Recreation Development Fund
A fund created to account for the receipt and expenditure of payment in lieu of parkland for the development of parks.
Sidewalk Fund
A fund created to account for resources designated for sidewalks.
91 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Drainage Maintenance Fund
The drainage fund was initiated in Fiscal Year 2023 as the City proposed to develop a more program -based approach to
drainage maintenance. The City of Pearland develops, maintains, and operates a drainage system that facilitates the
collection and movement of stormwater runoff throughout the community and into receiving streams. The City currently
has inventoried and maintains 322 miles of enclosed storm sewer, 145 miles of open ditch, 12,237 inlets and 179
detention sites.
Grant Fund
To account for all revenues and expenditures associated with federal, state and local grants, except CDBG.
CDBG Grant Fund
The Community Development Block Grant Fund is funded through the U.S. Department of Housing and Urban
Development (HUD) for use in providing programs, services and local infrastructure improvements that benefit low- and
moderate -income families.
CDBG Disaster Recovery Fund
The Texas General Land Office administers the State's funding from the U.S. Department of Housing & Urban
Development (HUD) for the purpose of Community Development Block Grant - Disaster Recovery (CDBG-DR) funding;
specifically, Hurricane Harvey federal disaster no. DR -TX -4332.
Disaster Recovery Fund
The Disaster Recovery Fund is specifically designed to account for various expenditures associated with major, federally
declared catastrophes that may be the subject of FEMA Public Assistance, or some other federal and/or State grant that
covers eligible costs involving the City's of local disaster response/recovery.
Hazard Mitigation Fund
The Texas Division of Emergency Management (TDEM) and the Texas Water Development Board (TWDB) separately
administer various types of hazard and flood mitigation assistance to localities with post -disaster recovery needs;
specifically, buyouts of flood -damaged residential property, elevation of flood -damaged homes, generators for public
safety and emergency management facilities, and other eligible mitigation investments. The City of Pearland is
repetitively impacted by hurricanes, tropical storms and other severe weather events that produce damages to private
and public property via high winds, wind -driven rain, torrential rain, flooding, and other harmful meteorological
conditions.
Coronavirus Relief Fund
The City of Pearland was a recipient of a direct allocation of Coronavirus Aid, Relief and Economic Security (CARES) Act
funding for COVID-19 preparedness, response, prevention and recovery, issued by the State of Texas - Division of
Emergency Management (TDEM) for the Brazoria County portion of the City. This allocation of funds was based on the
U.S. Treasury method of distribution outlined in the CARES Act - $55 per capita for the applicable population within the
jurisdiction. For the Brazoria County portion of population within the City of Pearland city limits, this amounted to
$6,374,005 for the 2019 Census Bureau 115,891 population.
92 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
ARPA Fund
After the expiration of the 116th Congress' Coronavirus Aid, Relief, and Economic Security (CARES) Act in 2020, the 117th
Congress passed additional Coronavirus recovery stimulus measures in the form of the American Rescue Plan Act (ARPA)
in 2021. In addition to the expenditure allowances provided in the CARES Act, ARPA provides eligible jurisdictions with
the ability to engage in economic recovery efforts involving the use of these funds for water and wastewater treatment
projects, broadband infrastructure, as well as public entity economic recovery from COVID-19 revenue losses. The City of
Pearland received $11,888,971 in ARPA State & Local Fiscal Recovery Funds (SLFRF) in two equal payments, the first of
which was made in June of 2021 in the amount of $5,944,486, with the second payment of the remaining balance of the
award being made in FY 2022. Funds may be used the same as allowable with the CARES Act, in addition to being able to
cover revenue losses from COVID-19, water/wastewater facility improvements, and broadband infrastructure. All funds
must be obligated for expenditures by December 31, 2024 and fully expended by December 31, 2026.
Opioid Settlement Fund
To account for all revenues and expenditures associated with the Opioid Settlement funds.
Traffic Impact Improvement Fund
A fund created to account for resources and expenditures from traffic impact analysis.
Truancy Prevention and Diversion Fund
A fund created to account for receipt and expenditure of revenues from court fines for juvenile case manager.
Municipal Jury Fund
Effective January 1, 2020, Senate Bill 346 created the Local Consolidated Fee total $14 of which $0.10 is allocated to the
Local Municipal Jury Fund. Money allocated under Section 134.101, 134.102, or 134.103 to the county or municipal jury
fund maintained in the county or municipal treasury, as applicable, and as required by Section 134.151 may be used by a
county or a municipality only to fund juror reimbursements and otherwise finance jury services.
Municipal Channel (PEG) Fund
A fund created to account for the revenues and expenditures associated with the purchase of equipment for public -
access television broadcasting under rules set forth by the Federal Communications Commission (FCC).
U of H Fund
A fund created to account for lease revenues and the operating expenditures related to the University of Houston Clear
Lake-Pearland Campus built by the City and leased to the University of Houston Clear Lake and the Pearland Economic
Development Corporation.
Regional Detention Fund
The Regional Detention Fund accounts for regional detention development.
Infrastructure Reinvestment Fund
A fund used to account for the repair and maintenance of streets and sidewalks.
93 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
Hotel/Motel
Occupancy Tax
Fund
Municipal Court
Security Fund
$ 8,842,097 $
450,763
12,923
$ 9,305,783 $
$ 16,512 $
39,832
56,344
12,923
9,236,516
9,249,439
$ 9,305,783 $
Page 1 of 8
City Wide Court
Donation Fund Technology Fund
99,915 $ 267,204 $
99,915 $ 267,204 $
$ $
2,497
2,497
97,418 267,204
97,418 267,204
99,915 $ 267,204 $
24,985
24,985
487
3,084
3,571
21,414
21,414
24,985
94 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
$
Page 2 of 8
Street Parks Financial
Assessment Park Donations Assistance
Fund Fund Tree Trust Fund Donations Fund
57 $ 107,407 $ 1,758,307 $ 4,866
$ 57 $ 107,407 $ 1,758,307 $ 4,866
$ - $ 10,200 $ - $
$
- 10,200
57
97,207 1,758,307 4,866
57 97,207 1,758,307 4,866
57 $ 107,407 $ 1,758,307 $ 4,866
95 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
Police State
Seizure Fund
Police Federal Community
Seizure Fund Safety Fund
Page 3 of 8
Parks &
Recreation
Development
Fund
$ 186,460 $ 435,159 $ 45,813 $ 1,369,513
- 28,219 -
$ 186,460 $ 463,378 $ 45,813 $ 1,369,513
$ 3,664 $
3,664
182,796
182,796
$ 186,460 $
151,077 $ - $
151,077
312,301 45,813 1,369,513
312,301 45,813 1,369,513
463,378 $ 45,813 $ 1,369,513
96 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
Page 4 of 8
Drainage
Maintenance CDBG Grant
Sidewalk Fund Fund Grant Fund Fund
$ 139,510 $ 757,733 $ 168,518 $ 259,739
- 80,879
$ 139,510 $ 757,733 $ 249,397 $ 259,739
$ - $ 32,030 $ - $ 119,165
- 81,725 8,461 -
- - 355,961
- 113,755 8,461 475,126
139,510 643,978 240,936 -
- - (215,387)
139,510 643,978 240,936 (215,387)
$ 139,510 $ 757,733 $ 249,397 $ 259,739
97 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
CDBG Disaster
Recovery Fund
Page 5 of 8
Disaster Hazard Coronavirus
Recovery Fund Mitigation Fund Relief Fund
$ - $
960,134
$ 960,134 $
2,250
2,250 $
$ 191,956 $
128,325
3,005,666 4,358,412
3,325,947
4,358,412
$
$
$ 144,422 $
902,426
1,046,848
(2,365,813) (4,356,162) (1,046,848)
(2,365,813) (4,356,162) (1,046,848)
$ 960,134 $ 2,250 $ - $
98 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
Opioid
ARPA Fund Settlement Fund
Traffic Impact
Improvement
Fund
$ 1,781,236 $ 105,361 $ 437,797
Page 6 of 8
Truancy
Prevention and
Diversion Fund
$ 24,752
$ 1,781,236 $ 105,361 $ 437,797 $
$
1,779,728
1,779,728
$
1,508
1,508
$ 1,781,236 $
$
24,752
$ -
- 1,735
105,361 437,797
105,361 437,797
105,361 $ 437,797 $
1,735
23,017
23,017
24,752
99 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
Municipal Jury
Fund
Municipal
Channel (PEG)
Fund
U of H Fund
Page 7 of 8
Regional
Detention Fund
$ 3,811 $ 734,972 $ - $ 233,034
- 8,916
$ 3,811 $ 743,888 $ $ 233,034
$ 60 $ $ - $
- 27,299
60 27,299
3,751 743,888
- - 233,034
- (27,299) -
3,751 743,888 (27,299) 233,034
$ 3,811 $ 743,888 $ - $ 233,034
100 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING BALANCE SHEET - NON -MAJOR GOVERNMENTAL FUNDS
September 30, 2025
Assets
Cash and cash equivalents
Receivables (net of allowance
for uncollectibles)
Prepaids
Total Assets
Liabilities
Accounts payable
Accrued liabilities
Due to other funds
Unearned revenue
Total Liabilities
Total
Infrastructure Nonmajor
Reinvestment Governmental
Fund Funds
$ 757,291 $ 18,545,537
- 1,531,161
- 12,923
757,291 $ 20,089,621
$ 669,573
4,691 297,649
- 8,266,504
- 2,135,689
4,691 11,369,415
Fund Balances
Nonspendable - 12,923
Restricted - 14,708,734
Committed 752,600 752,600
Assigned - 1,257,458
Unassigned - (8,011,509)
Total Fund Balances 752,600 8,720,206
Total Liabilities and Fund Balances $ 757,291 $ 20,089,621
Page 8 of 8
101 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
Page 1 of 8
Hotel/Motel
Occupancy Tax Municipal Court City Wide Court
Fund Security Fund Donation Fund Technology Fund
$ 1,808,429 $ - $ - $
50,758 37,241
369,744 3,260
5,050
2,183,223 54,018
10,194 817
25,078
35,272
- 17,006
1,140,380
85,251
208
73,941
1,299,780
883,443
38,058
30,938 33,600
30,938
23,080
17,006 33,600
18,266 4,458
(39,438)
(39,438)
844,005 23,080 18,266 4,458
8,405,434 74,338 248,938 16,956
$ 9,249,439 $ 97,418 $ 267,204 $ 21,414
102 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Street
Assessment
Fund
$
Park Donations
Fund
$
Tree Trust Fund
Page 2 of 8
Parks Financial
Assistance
Donations Fund
- $
- 379,850 -
2 3,309 58,054 117
- 181,805 5,000
2 185,114 437,904 5,117
36,595 -
139,012 3,245
97,043
139,012 133,638
3,245
Excess (Deficiency) of Revenues
Over Expenditures 2 46,102 304,266 1,872
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
2 46,102 304,266
1,872
Fund Balances (Deficits) - Beginning 55 51,105 1,454,041 2,994
Fund Balances (Deficits) - Ending $ 57 $ 97,207 $ 1,758,307 $ 4,866
103 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
Page 3 of 8
Parks &
Recreation
Police State Police Federal Community Development
Seizure Fund Seizure Fund Safety Fund Fund
593,738
6,398 8,521 1,717 54,263
60,679 264,260
67,077 272,781 1,717 648,001
9,664 28,254
147,741
9,664 175,995
57,413 96,786 1,717 648,001
- (616,154)
(616,154)
57,413 96,786 1,717 31,847
125,383 215,515 44,096 1,337,666
$ 182,796 $ 312,301 $ 45,813 $ 1,369,513
104 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
Drainage
Maintenance
Sidewalk Fund Fund
$ - $
66,683
3,761
70,444
70,444
70,444
69,066
$ 139,510 $
$
50,442
50,442
1,874,834
1,874,834
(1,824,392)
1,132,500
1,132,500
(691,892)
1,335,870
643,978 $
Grant Fund
10,382
543,838
554,220
26,596
292,287
81,554
400,437
153,783
Page 4 of 8
CDBG Grant
Fund
$
377,121
377,121
68,256
275,039
184,339
527,634
(150,513)
153,783 (150,513)
87,153 (64,874)
240,936 $ (215,387)
105 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
CDBG Disaster
Recovery Fund
$
960,134
235,013
1,195,147
9,147
3,177,573
12,169
3,198,889
(2,003,742)
(2,003,742)
Disaster Hazard Coronavirus
Recovery Fund Mitigation Fund Relief Fund
(362,071)
$ (2,365,813) $
- $ $
606,043
606,043
(606,043)
(606,043)
420,794
420,794
1,052,015
60,358
1,112,373
(691,579)
(691,579)
(3,750,119) (355,269)
(4,356,162) $ (1,046,848) $
Page 5 of 8
1,412,395
1,412,395
1,412,395
(1,412,395)
106 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
$
Page 6 of 8
Traffic Impact Truancy
Opioid Improvement Prevention and
ARPA Fund Settlement Fund Fund Diversion Fund
1,508
899,161
589
67,955
14,065
46,584
396
900,669 589 82,020 46,980
- 18,687
886,841
886,841
18,687
13,828 589 82,020 28,293
13,828 589 82,020
28,293
(12,320) 104,772 355,777 (5,276)
$ 1,508 $ 105,361 $ 437,797 $ 23,017
107 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
Municipal
Municipal Jury Channel (PEG)
Fund Fund
$
- $ - $
- 162,251
907
138 26,539
1,045 188,790
770 23,317
U of H Fund
Page 7 of 8
Regional
Detention Fund
736
8,732
9,468
770 23,317 - -
275 165,473 9,468
275 165,473 9,468
3,476 578,415 (27,299) 223,566
$ 3,751 $ 743,888 $ (27,299) $ 233,034
108 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NON -MAJOR GOVERNMENTAL FUNDS
For the Year Ended September 30, 2025
Revenues
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Public works
Community services
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances (Deficits) - Beginning
Fund Balances (Deficits) - Ending
Total
Infrastructure Nonmajor
Reinvestment Governmental
Fund Funds
$ $ 1,808,429
162,251
593,738
135,490
515,224
6,382 639,330
3,201,048
776,885
6,382 7,832,395
710,042
347,211
246,105 2,120,939
143,907
1,282,637
85,251
208
307,677 6,099,424
256,866
553,782 11,046,485
(547,400) (3,214,090)
1,554,731 4,099,626
(655,592)
1,554,731 3,444,034
1,007,331 229,944
(254,731) 8,490,262
$ 752,600 $ 8,720,206
Page 8 of 8
109 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
DEBT SERVICE FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Property taxes
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
Debt Service:
Principal
Interest and other charges
Bond issuance costs
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Issuance of debt - bonds
Premium on bonds issued
Payment to refunded bond escrow agent
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original Final
Budget Budget
$ 40,680,000 $ 40,750,439 $
14,599,978
55,279,978
27,370,000
17,026,661
11,643,128
3,870,158
59,909,947
(4,629,969)
2,656,885
1,424,790
17,417,255
59,592,484
27,060,000
17,080,524
12,988,251
3,786,531
60,915,306
(1,322,822)
2,611,727
2,656,885 2,611,727
(1,973,084) 1,288,905
Variance with
Actual Final Budget 2024
38,447,756 $ (2,302,683) $ 39,578,274
77,805 77,805 966,443
1,428,510 3,720
667,635 (16,749,620) 692,978
40,621,706 (18,970,778) 41,237,695
40,005,000 (12,945,000) 34,985,000
16,171,084 909,440 15,203,893
1,078,017 11,910,234 783,864
3,786,531 - 3,516,458
61,040,632 (125,326) 54,489,215
(20,418,926) (19,096,104) (13,251,520)
19,362,029 16,750,302 11, 315, 319
23,550,000 23,550,000 -
1,200,598 1,200,598
(25,141,729) (25,141,729) -
18,970,898 16, 359,171 11, 315,319
(1,448,028) (2,736,933) (1,936,201)
5,687,198 5,687,198 5,687,198 - 7,623,399
$ 3,714,114 $ 6,976,103 $ 4,239,170 $ (2,736,933) $ 5,687,198
110 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
HOTEL/MOTEL OCCUPANCY TAX FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Sales and use taxes
Investment earnings
Other
Total Revenues
Expenditures
Current:
Parks and recreation
Debt Service:
Principal
Interest and other charges
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers out
Total Other Financing Sources (Uses)
Net change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original Final
Budget Budget
Actual
Variance with
Final Budget 2024
$ 1,800,000 $ 1,852,800 $ 1,808,429 $ (44,371) $ 1,919,535
383,122 377,615 369,744 (7,871) 401,344
15,000 5,050 5,050 1,947
2,198,122 2,230,415 2,183,223 (47,192) 2,322,826
1,599,722 1,623,412 1,140,380 483,032 1,003,489
85,251 (85,251) 21,185
208 (208) 150
600,000 600,000 73,941 526,059 -
2,199,722 2,223,412 1,299,780 923,632 1,024,824
(1,600) 7,003 883,443 876,440 1,298,002
(39,438) (39,438) (39,438) - (636,221)
(39,438) (39,438) (39,438) - (636,221)
(41,038) (32,435) 844,005 876,440 661,781
8,405,434 8,405,434 8,405,434 - 7,743,653
$ 8,364,396 $ 8,372,999 $ 9,249,439 $ 876,440 $ 8,405,434
111 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
MUNICIPAL COURT SECURITY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Fines and forfeitures
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 36,500 $ 44,370 $ 50,758 $ 6,388 $ 41,763
2,200 3,395 3,260 (135) 3,021
38,700 47,765 54,018 6,253 44,784
32,326 31,461 30,938 523 28,980
32,326 31,461 30,938 523 28,980
6,374 16,304 23,080 6,776 15,804
74,338 74,338 74,338 - 58,534
$ 80,712 $ 90,642 $ 97,418 $ 6,776 $ 74,338
112 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
CITY WIDE DONATION FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Other
Total Revenues
Expenditures
Current:
Public safety
Capital outlay
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 12,021 $ 10,872 $ 10,194 $ (678) $ 10,405
47,300 34,000 25,078 (8,922) 41,195
59,321 44,872 35,272 (9,600) 51,600
71,500 46,078 17,006 29,072 27,943
49,998 - 49,998 -
71,500 96,076 17,006 79,070 27,943
(12,179) (51,204) 18,266 69,470 23,657
248,938 248,938 248,938 - 225,281
$ 236,759 $ 197,734 $ 267,204 $ 69,470 $ 248,938
113 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
COURT TECHNOLOGY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Fines and forfeitures
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 45,000 $ 37,000 $ 37,241 $ 241 $ 34,245
455 877 817 (60) 598
45,455 37,877 38,058 181 34,843
41,770 36,370 33,600 2,770 24,024
41,770 36,370 33,600 2,770 24,024
3,685 1,507 4,458 2,951 10,819
16,956 16,956 16,956 - 6,137
$ 20,641 $ 18,463 $ 21,414 $ 2,951 $ 16,956
114 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
STREET ASSESSMENT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Investment earnings
Total Revenues
Expenditures
Total Expenditures
Net Change in Fund Balances
Original
Budget
$
Final
Budget
Actual
Variance with
Final Budget 2024
5 $ - $ 2 $ 2 $ 3
5 - 2
5 - 2
Fund Balances - Beginning 55
Fund Balances - Ending $ 60 $
2 3
2 3
55 55 - 52
55 $ 57 $ 2 $ 55
115 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
PARK DONATIONS FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Other
Total Revenues
Expenditures
Current:
Parks and recreation
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 5,628 $ 3,577 $ 3,309 $ (268) $ 4,486
206,550 206,500 181,805 (24,695) 124,328
212,178 210,077 185,114 (24,963) 128,814
250,000 250,000 139,012 110,988 163,035
250,000 250,000 139,012 110,988 163,035
(37,822) (39,923) 46,102 86,025 (34,221)
51,105 51,105 51,105 - 85,326
$ 13,283 $ 11,182 $ 97,207 $ 86,025 $ 51,105
116 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
TREE TRUST FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Charges for services
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Capital outlay
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 2,000 $ 51,900 $ 379,850 $ 327,950 $ 155,994
70,519 58,551 58,054 (497) 62,871
72,519 110,451 437,904 327,453 218,865
67,500 69,900 36,595 33,305 64,167
367,250 1,168,595 97,043 1,071,552 95,961
434,750 1,238,495 133,638 1,104,857 160,128
(362,231) (1,128,044) 304,266 1,432,310 58,737
1,454,041 1,454,041 1,454,041 - 1,395,304
$ 1,091,810 $ 325,997 $ 1,758,307 $ 1,432,310 $ 1,454,041
117 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
PARKS FINANCIAL ASSISTANCE DONATIONS FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Other
Total Revenues
Expenditures
Current:
Parks and recreation
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 125 $ 175 $ 117 $ (58) $ 131
5,000 5,000 5,000 - 5,000
5,125 5,175 5,117 (58) 5,131
5,000 5,000 3,245 1,755 5,000
5,000 5,000 3,245 1,755 5,000
125 175 1,872 1,697 131
2,994 2,994 2,994 - 2,863
$ 3,119 $ 3,169 $ 4,866 $ 1,697 $ 2,994
118 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
POLICE STATE SEIZURE FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Other
Total Revenues
Expenditures
Current:
Public safety
Capital outlay
Total Expenditures
$ 11,134 $ 6,548 $ 6,398 $ (150) $ 8,207
41,386 60,679 19,293 63,126
11,134 47,934 67,077 19,143 71,333
31,200
31,200
Net Change in Fund Balances (20,066)
Fund Balances - Beginning
Fund Balances - Ending
16,200 9,664 6,536 22,689
100,000 - 100,000 105,560
116,200 9,664 106,536 128,249
(68,266) 57,413 125,679 (56,916)
125,383 125,383 125,383 - 182,299
$ 105,317 $ 57,117 $ 182,796 $ 125,679 $ 125,383
119 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
POLICE FEDERAL SEIZURE FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Other
Total Revenues
Expenditures
Current:
Public safety
Capital outlay
Total Expenditures
$ 6,824 $ 8,020 $ 8,521 $ 501 $ 6,084
7,430 264,260 256,830 98,908
6,824 15,450 272,781 257,331 104,992
75,200
75,200
Net Change in Fund Balances (68,376)
Fund Balances - Beginning
Fund Balances - Ending
40,200 28,254 11,946 -
150,000 147,741 2,259 83,347
190,200 175,995 14,205 83,347
(174,750) 96,786 271,536 21,645
215,515 215,515 215,515 - 193,870
$ 147,139 $ 40,765 $ 312,301 $ 271,536 $ 215,515
120 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
COMMUNITY SAFETY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Total Revenues
Expenditures
Intergovernmental
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 8,000 $ 1,898 $ 1,717 $ (181) $ 6,241
8,000 1,898 1,717 (181) 6,241
18,700
18,700
8,000 1,898 1,717 (181) (12,459)
(168,515)
(168,515)
8,000 1,898 1,717 (181) (180,974)
44,096 44,096 44,096 - 225,070
$ 52,096 $ 45,994 $ 45,813 $ (181) $ 44,096
121 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
PARKS & RECREATION DEVELOPMENT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Licenses and permits
Investment earnings
Total Revenues
Expenditures
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
$ 409,000 $ 409,000 $ 593,738 $ 184,738 $ 471,787
37,115 56,100 54,263 (1,837) 39,454
446,115 465,100 648,001 182,901 511,241
900,000 900,000 - 900,000
900,000 900,000 - 900,000
(453,885) (434,900) 648,001 1,082,901 511,241
Net Change in Fund Balances (453,885)
Fund Balances - Beginning
Fund Balances - Ending
(616,154) (616,154)
(616,154) (616,154)
(1,051,054) 31,847
234,098
234,098
1,082,901 745,339
1,337,666 1,337,666 1,337,666 - 592,327
$ 883,781 $ 286,612 $ 1,369,513 $ 1,082,901 $ 1,337,666
122 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
SIDEWALK FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Charges for services
Investment earnings
Total Revenues
Expenditures
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 5,000 $ 30,283 $ 66,683 $ 36,400 $
3,472 3,778 3,761 (17) 3,001
8,472 34,061 70,444 36,383 3,001
8,472 34,061 70,444 36,383 3,001
69,066 69,066 69,066 - 66,065
$ 77,538 $ 103,127 $ 139,510 $ 36,383 $ 69,066
123 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
DRAINAGE MAINTENANCE FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Total Revenues
Expenditures
Current:
Public works
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 46,693 $ 60,416 $ 50,442 $ (9,974) $ 45,256
46,693 60,416 50,442 (9,974) 45,256
2,224,449 2,037,505 1,874,834 162,671 1,296,070
2,224,449 2,037,505 1,874,834 162,671 1,296,070
(2,177,756) (1,977,089) (1,824,392) 152,697 (1,250,814)
1,600,000 1,100,000 1,132,500 32,500
1,600,000 1,100,000 1,132,500 32,500
(577,756) (877,089) (691,892) 185,197
2,130,458
2,130,458
879,644
1,335,870 1,335,870 1,335,870 - 456,226
$ 758,114 $ 458,781 $ 643,978 $ 185,197 $ 1,335,870
124 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
GRANT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Investment earnings
Intergovernmental
Total Revenues
Expenditures
Current:
General government
Public safety
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original Final
Budget Budget
Actual
Variance with
Final Budget 2024
10,382 10,382
$ 378,190 $ 463,174 $ 543,838 $ 80,664 $ 358,780
378,190 463,174 554,220 91,046 358,780
27,042 30,329
168,504 228,751
70,953
195,546 330,033
182,644 133,141
26,596
292,287
81,554
400,437
3,733
(63,536)
(10,601)
(70,404)
153,783 20,642
1,500
125,485
300,513
427,498
(68,718)
(88,665)
(88,665)
182,644 133,141 153,783 20,642 (157,383)
87,153 87,153 87,153 - 244,536
$ 269,797 $ 220,294 $ 240,936 $ 20,642 $ 87,153
125 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
CDBG GRANT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Intergovernmental
Total Revenues
Expenditures
Current:
General government
Community services
Capital outlay
Intergovernmental
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
$ 456,770 $ 3,752,350 $ 377,121 $ (3,375,229) $ 338,343
456,770 3,752,350 377,121 (3,375,229) 338,343
73,633 73,633 68,256 5,377 -
15,227
293,613 3,491,435 275,039 3,216,396 -
89,524 309,488 184,339 125,149 450,781
456,770 3,874,556 527,634 3,346,922 466,008
(122,206) (150,513) (28,307) (127,665)
(64,874) (64,874) (64,874) 62,791
$ (64,874) $ (187,080) $ (215,387) $ (28,307) $ (64,874)
126 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
CDBG DISASTER RECOVERY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Intergovernmental
Other
Total Revenues
Expenditures
Current:
General government
Capital outlay
Intergovernmental
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
Original
Budget
$
Final Variance with
Budget Actual Final Budget
$ 16,494,344 $ 960,134 $ (15,534,210) $
235,013 235,013
16,494,344 1,195,147 (15,299,197)
2024
58,793 9,147 49,646 -
14,858,845 3,177,573 11,681,272 53,653
1,581,689 12,169 1,569,520 648
16,499,327 3,198,889 13,300,438 54,301
(4,983) (2,003,742) (1,998,759) (54,301)
(362,071) (362,071) (362,071) (307,770)
$ (362,071) $ (367,054) $ (2,365,813) $ (1,998,759) $ (362,071)
127 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
DISASTER RECOVERY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Other
Total Revenues
Expenditures
Current:
General government
Total Expenditures
Original Final
Budget Budget
$ $
Actual
Variance with
Final Budget 2024
$ $
606,043
606,043
$ 2,246
2,246
(606,043) 3,683,963
(606,043) 3,683,963
Net Change in Fund Balances - - (606,043) (606,043) (3,681,717)
Fund Balances - Beginning
Fund Balances (Deficit) - Ending $ (3,750,119) $ (3,750,119) $ (4,356,162) $ (606,043) $ (3,750,119)
(3,750,119) (3,750,119) (3,750,119) (68,402)
128 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
HAZARD MITIGATION FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Intergovernmental
Other
Total Revenues
Expenditures
Current:
Capital outlay
Intergovernmental
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
$ $ 7,155,756 $ 420,794 $ (6,734,962) $
47,179
7,155,756 420,794 (6,734,962) 47,179
4,758,302
2,397,454
7,155,756
1,052,015 3,706,287 308,854
60,358 2,337,096 9,900
1,112,373 6,043,383 318,754
(691,579) (691,579) (271,575)
(355,269) (355,269) (355,269) - (83,694)
$ (355,269) $ (355,269) $ (1,046,848) $ (691,579) $ (355,269)
129 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
CORONAVIRUS RELIEF FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Total Revenues
Expenditures
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
Original Final Variance with
Budget Budget Actual Final Budget 2024
$ - $ $ - $ $
1,412,395
1,412,395
1,412,395
1,412,395
1,412,395 1,412,395
(1,412,395) (1,412,395) (1,412,395) (1,412,395)
$ (1,412,395) $ - $ - $ - $ (1,412,395)
130 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
ARPA FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Investment earnings
Intergovernmental
Total Revenues
Expenditures
Current:
General government
Capital outlay
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
Original
Budget
$
$
(12,320)
$ (12,320) $
Final
Budget
2,561,833
2,561,833
Actual
$ 1,508
899,161
900,669
Variance with
Final Budget
$ 1,508 $
(1,662,672)
(1,661,164)
2024
1,683,528 - 1,683,528 12,320
42,365 886,841 (844,476) -
1,725,893 886,841 839,052 12,320
835,940 13,828 (822,112) (12,320)
(12,320) (12,320) - -
823,620 $ 1,508 $ (822,112) $ (12,320)
131 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
OPIOID SETTLEMENT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Total Revenues
Expenditures
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
589 589
589 589
589 589
104,772 104,772 104,772 - 104,772
$ 104,772 $ 104,772 $ 105,361 $ 589 $ 104,772
132 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
TRAFFIC IMPACT IMPROVEMENT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Charges for services
Investment earnings
Total Revenues
Expenditures
Current:
Public works
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original Final
Budget Budget
Actual
Variance with
Final Budget 2024
67,955 67,955
$ 17,480 $ 14,958 $ 14,065 $ (893) $ 15,457
17,480 14,958 82,020 67,062 15,457
214,920
214,920
(197,440) 14,958 82,020 67,062 15,457
355,777 355,777 355,777 - 340,320
$ 158,337 $ 370,735 $ 437,797 $ 67,062 $ 355,777
133 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
TRUANCY PREVENTION AND DIVERSION FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Fines and forfeitures
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
$ 38,000 $ 46,370 $ 46,584 $ 214 $ 42,825
194 396 202
38,000 46,564 46,980 416 42,825
21,267 20,867 18,687 2,180 43,773
21,267 20,867 18,687 2,180 43,773
16,733 25,697 28,293 2,596 (948)
(5,276) (5,276) (5,276) - (4,328)
$ 11,457 $ 20,421 $ 23,017 $ 2,596 $ (5,276)
134 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
MUNICIPAL JURY FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Fines and forfeitures
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ 1,100 $ 900 $ 907 $ 7 $ 1,204
166 195 138 (57) 150
1,266 1,095 1,045 (50) 1,354
1,000 960 770 190 420
1,000 960 770 190 420
266 135 275 140 934
3,476 3,476 3,476 - 2,542
$ 3,742 $ 3,611 $ 3,751 $ 140 $ 3,476
135 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
MUNICIPAL CHANNEL (PEG) FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Franchise fees
Investment earnings
Total Revenues
Expenditures
Current:
Community services
Capital outlay
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
Original
Budget
$ 235,000
24,244
259,244
Final
Budget
$ 180,000
26,957
206,957
Variance with
Actual Final Budget
$ 162,251
26,539
188,790
$ (17,749) $
(418)
(18,167)
2024
179,526
25,413
204,939
101,000 80,300 23,317 56,983 15,676
150,425
101,000 80,300 23,317 56,983 166,101
158,244 126,657 165,473 38,816 38,838
578,415 578,415 578,415 - 539,577
$ 736,659 $ 705,072 $ 743,888 $ 38,816 $ 578,415
136 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
U OF H FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Revenues
Total Revenues
Expenditures
Total Expenditures
Original Final Variance with
Budget Budget Actual Final Budget 2024
$ $ - $ $ - $
Net Change in Fund Balances - -
Fund Balances - Beginning
Fund Balances (Deficit) - Ending
$ (27,299) $ (27,299) $ (27,299) $
$ (27,299) $ (27,299) $ (27,299) $
$ (27,299)
$ (27,299)
137 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
REGIONAL DETENTION FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Charges for services
Investment earnings
Total Revenues
Expenditures
Total Expenditures
Net change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
$ - $ 736 $ 736 $ - $ 7,000
10,739 9,447 8,732 (715) 9,568
10,739 10,183 9,468 (715) 16,568
10,739 10,183 9,468
(715) 16,568
223,566 223,566 223,566 - 206,998
$ 234,305 $ 233,749 $ 233,034 $ (715) $ 223,566
138 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
INFRASTRUCTURE REINVESTMENT FUND
For the Year Ended September 30, 2025
With Comparative Actual for the Year Ended September 30, 2024
Original Final Variance with
Budget Budget Actual Final Budget 2024
Revenues
Investment earnings
Total Revenues
Expenditures
Current:
Public works
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
Over Expenditures
Other Financing Sources (Uses)
Transfers in
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances (Deficit) - Ending $ (724,180) $ (932,101) $ 752,600 $ 1,684,701 $ (254,731)
$ 65,369 $ - $ 6,382 $ 6,382 $ 42,364
65,369 - 6,382 6,382 42,364
1,129,858 1,527,141 246,105 1,281,036 2,344,366
704,960 704,960 307,677 397,283 701,740
1,834,818 2,232,101 553,782 1,678,319 3,046,106
(1,769,449) (2,232,101) (547,400) 1,684,701 (3,003,742)
1,300,000 1,554,731 1,554,731 - 1,300,000
1,300,000 1,554,731 1,554,731 - 1,300,000
(469,449) (677,370) 1,007,331 1,684,701 (1,703,742)
(254,731) (254,731) (254,731) - 1,449,011
139 City of Pearland, Texas 2025 ACFR
140 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
INTERNAL SERVICE FUNDS
September 30, 2025
Internal Service Funds are used to account for the financing of goods or services provided by one department or agency to
other departments or agencies of the government and to other government units, on a cost reimbursement basis.
Property Liability Insurance Fund — To account for the activities of the City's property and casualty insurance. Coverage
includes general liability, law enforcement, public official and employees' liability, auto liability, physical damage and multi -
peril, mobile equipment, real and personal property, and windstorm coverage.
Employee Benefits Fund — City to employees except for health insurance.
Health Claims Fund —To account for the activities of the City's employee health insurance. The fund accounts for retiree and
COBRA contributions, claims and coverage.
Motor Pool Fund — To account for the operations and maintenance of the City's fleet. Its customers are City departments,
and its primary revenue source is payments from those departments for vehicle and equipment maintenance and
replacement.
Facilities Fund — To account for the funding for building -related repair and maintenance, equipment maintenance, capital
replacement, or asset recapitalization, and janitorial services.
Information Technology Fund — To account for technology services in order to better anticipate the current and future
technology needs of the City.
Capital Fund — To account for certain capital -related lease or financing arrangements.
141 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF NET POSITION - INTERNAL SERVICE FUNDS
September 30, 2025
Assets
Current assets:
Cash and cash equivalents
Receivables, net
Prepaids
Inventories
Restricted cash and cash equivalents
Total current assets
Noncurrent assets:
Capital assets:
Machinery and equipment
Right -to -use software
Less accumulated
depreciation/amortization
Total noncurrent assets
Total Assets
Deferred Outflows of Resources
Pension related
OPEB related
Total Deferred Outflows of Resources
Liabilities
Current liabilities:
Accounts payable
Accrued liabilities
Accrued interest
Customer deposits
Current portion of noncurrent liabilities:
SBITA payable
Total current liabilities:
Noncurrent liabilities:
Compensated absences
SBITA payable
Net pension liability
Total OPEB liability
Total noncurrent liabilities:
Total Liabilities
Deferred Inflows of Resources
Pension related
OPEB related
Total Deferred Inflows of Resources
Net Position
Net investment in capital assets
Unrestricted
Total Net Position
Risk
Management Employee Health Claims Motor Pool
Fund Benefits Fund Fund Fund
$ 3,557,963 $ 370,938 $ 1,748,037 $ 9,755,086
18,752 9,399 19,412 173,761
4,524
754,350
5,000 271,315 -
3,581,715 380,337 2,038,764 10,687,721
16,823,638
(9,342,443)
7,481,195
3,581,715 380,337 2,038,764 18,168,916
8,342 83,417
443 4,429
8,785 87,846
35,523 987 514,666
(23,345) 302,888 (152,370) 64,193
(23,345)
14,711
338,411 (136,672)
578,859
56,049
18,597 - - 185,958
4,242 - - 42,423
22,839 - - 284,430
(506) 338,411 (136,672) 863,289
2,200
1,549
3,749
21,996
15,487
37,483
- 7,481,195
3,587,257 41,926 2,175,436 9,874,795
$ 3,587,257 $ 41,926 $ 2,175,436 $ 17,355,990
Page 1 of 2
142 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF NET POSITION - INTERNAL SERVICE FUNDS
September 30, 2025
Assets
Current assets:
Cash and cash equivalents
Receivables, net
Prepaids
Inventories
Restricted cash and cash equivalents
Total current assets
Noncurrent assets:
Capital assets:
Machinery and equipment
Right -to -use software
Less accumulated
depreciation/amortization
Total noncurrent assets
Total Assets
Deferred Outflows of Resources
Pension related
OPEB related
Total Deferred Outflows of Resources
Liabilities
Current liabilities:
Accounts payable
Accrued liabilities
Accrued interest
Customer deposits
Current portion of noncurrent liabilities:
SBITA payable
Total current liabilities:
Noncurrent liabilities:
Compensated absences
SBITA payable
Net pension liability
Total OPEB liability
Total noncurrent liabilities:
Total Liabilities
Deferred Inflows of Resources
Pension related
OPEB related
Total Deferred Inflows of Resources
Net Position
Net investment in capital assets
Unrestricted
Total Net Position
Information
Technology Total Internal
Facilities Fund Fund Capital Fund Service Funds
$ 1,415,902 $ 2,338,934 $ 8,648,459 $ 27,835,319
- - 221,324
- - 4,524
- - 754,350
- - 276,315
1,415,902 2,338,934 8,648,459 29,091,832
16,823,638
10,103,108 - 10,103,108
- (6,379,233) (15,721,676)
- 3,723,875 11,205,070
1,415,902 6,062,809 8,648,459 40,296,902
156,770 1,091,868
87,874 263,078
248,384
2,007,836
244,644 3,611,166
112,088 594,701
1,897,594
112,088 2,492,295
356,732 6,103,461
1,059,170
$ 1,059,170
$
91,759
4,872
96,631
1,799,814
542,318
248,384
14,711
2,007,836
4,613,063
762,838
1,897,594
204,555
46,665
2,911,652
7,524,715
24,196
17,036
41,232
(181,555) - 7,299,640
140,903 8,648,459 25,527,946
(40,652) $ 8,648,459 $ 32,827,586
Page 2 of 2
143 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN
NET POSITION - INTERNAL SERVICE FUNDS
For the Year Ended September 30, 2025
Operating Revenues
Charges for services:
Risk management
Equipment management
Miscellaneous
Total Operating Revenues
Operating Expenses
Personnel services
Supplies and materials
Buildings and grounds
Repairs and Maintenance
Contractual Services
Miscellaneous
Depreciation and amortization
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues (Expenses)
Investment earnings
Gain (loss) on disposal of property
Interest expense
Total Nonoperating Revenues (Expenses)
Income (Loss) Before Capital
Contributions and Transfers
Transfers in
Change in Net Position
Net Position (Deficit) - Beginning
Net Position (Deficit) - Ending
Risk
Management Employee Health Claims
Fund Benefits Fund Fund
Page 1 of 2
Motor Pool Fund
$ 732,387 $ - $ 10,540,246 $ -
- - - 6,804,610
462,116 - 586,419 -
1,194,503 - 11,126,665 6,804,610
63,500 - - 720,074
119 - - 19,322
96 - - 1,793,921
3,609,026 - 12,374,772 108,527
19,152 2,762,061
2,824,013
3,672,741 - 12,393,924 8,227,918
(2,478,238) - (1,267,259) (1,423,308)
86,344
86,344
765
765
81,715
81,715
431,316
220,101
(3,072)
648,345
(2,391,894) 765 (1,185,544) (774,963)
3,943,726 - - -
1,551,832 765 (1,185,544) (774,963)
2,035,425 41,161 3,360,980 18,130,953
$ 3,587,257 $ 41,926 $ 2,175,436 $ 17,355,990
144 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN
NET POSITION - INTERNAL SERVICE FUNDS
For the Year Ended September 30, 2025
Operating Revenues
Charges for services:
Risk management
Equipment management
Miscellaneous
Total Operating Revenues
Operating Expenses
Personnel services
Supplies and materials
Buildings and grounds
Repairs and Maintenance
Contractual Services
Miscellaneous
Depreciation and amortization
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues (Expenses)
Investment earnings
Gain (loss) on disposal of property
Interest expense
Total Nonoperating Revenues (Expenses)
Income (Loss) Before Capital
Contributions and Transfers
Transfers in
Change in Net Position
Net Position (Deficit) - Beginning
Net Position (Deficit) - Ending
Page 2 of 2
Information Total Internal
Facilities Fund Technology Fund Capital Fund Service Funds
$ $ $ - $ 11,272,633
3,284,365 10,837,207 3,644,964 24,571,146
- 10,000 - 1,058,535
3,284,365 10,847,207 3,644,964 36,902,314
869,785 3,018,742 - 4,672,101
31,336 34,855 - 85,632
1,169,359 - - 1,169,359
306,503 3,583,476 - 5,683,996
854,028 429,126 - 17,375,479
8,099 1,131,209 435,000 4,355,521
2,668,971 - 5,492,984
3,239,110 10,866,379 435,000 38,835,072
45,255 (19,172) 3,209,964 (1,932,758)
50,362 41,129 47,617 739,248
- - - 220,101
- (143,221) - (146,293)
50,362 (102,092) 47,617 813,056
95,617 (121,264) 3,257,581 (1,119,702)
- 410,000 - 4,353,726
95,617 288,736 3,257,581 3,234,024
963,553 (329,388) 5,390,878 29,593,562
$ 1,059,170 $ (40,652) $ 8,648,459 $ 32,827,586
145 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF CASH FLOWS - INTERNAL SERVICE FUNDS
For the Year Ended September 30, 2025
Cash Flows from Operating Activities
Receipts from interfund charges for services
Other receipts
Payments to employees for salaries and benefits
Payments to suppliers and service providers
Net Cash Provided (Used) by Operating Activities
Cash Flows from Noncapital Financing Activities
Transfers from other funds
Net Cash Provided (Used) by Noncapital Financing Activities
Cash Flows from Capital and Related Financing Activities
Acquisition and construction of capital assets
Principal payments on leases
Principal payments on SBITAs
Interest paid on capital related debt
Net cash Provided (Used) by Capital and
Related Financing Activities
Cash Flows from Investing Activities
Interest on investments
Net Cash Provided (Used) by Investing Activities
Net Increase (Decrease) in Cash and Cash Equivalents
Beginning Cash and Cash Equivalents
Ending Cash and Cash Equivalents
Reconciliation to the Statement of Net Position -
Proprietary Funds
Unrestricted cash and cash equivalents
Restricted cash and cash equivalents
Ending Cash and Cash Equivalents
Page 1 of 2
Risk Management Employee Health Claims Information Total Internal
Fund Benefits Fund Fund Motor Pool Fund Facilities Fund Technology Fund Capital Fund Service Funds
$ 732,387 $ - $ 10,540,246 $ 6,804,610 $ 3,284,365 $ 10,837,207 $ 3,644,964 $ 35,843,779
474,174 (6,155) 580,928 (172,633) 12,736 10,000 - 899,050
(62,499) - - (674,671) (845,324) (2,707,747) - (4,290,241)
(3,631,469) 374,576 (12,931,539) (4,745,823) (2,266,047) (4,319,117) (435,000) (27,954,419)
(2,487,407) 368,421 (1,810,365) 1,211,483 185,730 3,820,343 3,209,964 4,498,169
3,943,726 - - - - 410,000 - 4,353,726
3,943,726 - - - - 410,000 - 4,353,726
(1,403,951) - (1,978,418) - (3,382,369)
(63,568) - - - (63,568)
- - (589,106) - (589,106)
(3,072) - (143,221) - (146,293)
(1,470,591) - (2,710,745) - (4,181,336)
86,344 765 81,715 431,316 50,362 41,129 47,617 739,248
86,344 765 81,715 431,316 50,362 41,129 47,617 739,248
1,542,663 369,186 (1,728,650) 172,208 236,092 1,560,727 3,257,581 5,409,807
2,020,300 1,752 3,748,002 9,582,878 1,179,810 778,207 5,390,878 22,701,827
$ 3,562,963 $ 370,938 $ 2,019,352 $ 9,755,086 $ 1,415,902 $ 2,338,934 $ 8,648,459 $ 28,111,634
$ 3,557,963 $ 370,938 $ 1,748,037 $ 9,755,086 $ 1,415,902 $ 2,338,934 $ 8,648,459 $ 27,835,319
5,000 - 271,315 - - - - 276,315
$ 3,562,963 $ 370,938 $ 2,019,352 $ 9,755,086 $ 1,415,902 $ 2,338,934 $ 8,648,459 $ 28,111,634
146 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
COMBINING STATEMENT OF CASH FLOWS - INTERNAL SERVICE FUNDS
For the Year Ended September 30, 2025
Reconciliation of Operating Income (Loss) to Net
Cash Provided (Used) by Operating Activities
Operating income (loss)
Adjustment to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Depreciation and amortization expense
(Increase) decrease in assets
Accounts receivable, net
Prepaids
Inventories
Increase (decrease) in liabilities:
Accounts payable
Accrued liabilities
Customer deposits
Compensated absences
Net pension liability and related amounts
Total OPEB liability and related amounts
Net Cash Provided (Used) by Operating Activities
Non -cash Capital and Related Financing Activities
Gain (loss) on disposition of capital assets
Page 2 of 2
Risk Management Employee Health Claims Information Total Internal
Fund Benefits Fund Fund Motor Pool Fund Facilities Fund Technology Fund Capital Fund Service Funds
$ (2,478,238) $
12,058
$ (1,267,259) $ (1,423,308) $ 45,255 $ (19,172) $ 3,209,964 $ (1,932,758)
(6,155) (5,491)
2,824,013 - 2,668,971 - 5,492,984
(172,633)
(4,524)
(99,066)
12,736
1,500 6,914
(159,485)
3,890
(99,066)
- 35,523 987 59,211 98,019 960,862 - 1,154,602
(22,228) 339,053 (550,723) (17,613) 3,759 (108,227) - (355,979)
- - 12,121 - - - - 12,121
- - - 20,003 24,461 310,995 - 355,459
851 - - 19,139 - 19,990
150 - 6,261 6,411
$ (2,487,407) $ 368,421 $ (1,810,365) $ 1,211,483 $ 185,730 $ 3,820,343 $ 3,209,964 $ 4,498,169
$ $ $ $ 220,101 $ $ $ $ 220,101
147 City of Pearland, Texas 2025 ACFR
148 City of Pearland, Texas 2025 ACFR
STATISTICAL SECTION
149 City of Pearland, Texas 2025 ACFR
150 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
STATISTICAL SECTION (UNAUDITED)
September 30, 2025
This part of the City of Pearland's annual comprehensive financial report presents detailed information as a context for
understanding what the information in the financial statements, note disclosures, and required supplementary information
says about the City's overall financial health.
Contents Page
Financial Trends 152
These schedules contain trend information to help the readers understand how the City's financial
performance and well-being have changed over time.
Revenue Capacity 162
These schedules contain information to help the reader assess the City's most significant local revenue
sources, sales and property tax.
Debt Capacity 174
These schedules present information to help the reader assess the affordability of the City's current levels
of outstanding debt and the City's ability to issue additional debt in the future.
Demographic and Economic Information 180
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the City's financial activities take place.
Operating Information 183
These schedules contain service and infrastructure data to help the reader understand how the
information in the City's financial report relates to the services the city provides and the activities it
performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the annual
comprehensive financial reports for the relevant year.
151 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NET POSITION BY COMPONENT
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
2016
Governmental Activities
Net investment in capital assets $ 439,923
Restricted 60,640
Unrestricted 3,185
Total Governmental Activities
Net Position $ 503,748
2017
$ 449,141
60,310
(5,045)
2018
$ 454,670
67,263
(2,500)
2019
$ 488,077
56,491
(734)
Page 1 of 2
2020
$ 490,304
44,928
33,179
$ 504,406 $ 519,433 $ 543,834 $ 568,411
Business -Type Activities
Net investment in capital assets $ 187,937 $ 205,827
Restricted 15,852 13,972
Unrestricted 13,351 6,972
Total Business -Type Activities
Net Position $ 217,140 $ 226,771
Primary Government
Investment in capital assets
Restricted
Unrestricted
Total Primary Government
Net Position
$ 210,674
14,525
20,663
$ 214,672 $ 213,081
15,270 16,776
29,806 39,015
$ 245,862 $ 259,748 $ 268,872
$ 627,860 $ 654,968 $ 665,344 $ 702,749 $ 703,385
76,492 74,282 81,788 71,761 61,704
16,536 1,927 18,163 29,072 72,194
$ 720,888 $ 731,177 $ 765,295 $ 803,582 $ 837,283
152 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
NET POSITION BY COMPONENT
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
2021
Governmental Activities
Net investment in capital assets $ 493,671
Restricted 45,162
Unrestricted 52,796
Total Governmental Activities
Net Position
2022
$ 511,377
48,792
59,628
2023
$ 520,909
79,137
29,248
Page 2 of 2
2024 2025
$ 556,467
89,754
31,189
$ 607,401
95,526
14,404
$ 591,629 $ 619,797 $ 629,294 $ 677,410 $ 717,331
Business -Type Activities
Net investment in capital assets $ 161,157 $ 216,661 $ 221,205 $ 243,043 $ 134,048
Restricted 30,064 32,025 34,269 30,317 22,096
Unrestricted 81,185 20,264 28,548 29,985 155,504
Total Business -Type Activities
Net Position $ 272,406 $ 268,950 $ 284,022 $ 303,345 $ 311,648
Primary Government
Investment in capital assets
Restricted
Unrestricted
Total Primary Government
Net Position
$ 654,828 $ 728,038 $ 742,114 $ 799,510 $ 741,449
75,226 80,817 113,406 120,071 117,623
133,981 79,892 57,796 61,174 169,908
$ 864,035 $ 888,747 $ 913,316 $ 980,755 $ 1,028,980
153 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN NET POSITION
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
Primary Government 2016
Expenses
Governmental activities:
General government $ 18,016
Public safety 38,933
Public works 46,449
Community services 3,711
Parks and recreation 4,820
Economic development 31,330
Intergovernmental
Interest on long-term debt 15,946
Total government activities expenses 159,205
Business -type activities:
Water and Sewer 37,941
Solid Waste 6,833
Total Business -type activities 44,774
Total Expenses $ 203,979
Program Revenue
Governmental activities:
Charges for services:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Operating grants and contributions:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Capital grants and contributions:
Public works
Total governmental activities
Business -type activities:
Charges for services:
Water and sewer
Solid waste
Operating grants and contributions:
Water and sewer
Capital grants and contributions:
Water and sewer
Total Business -type activities
Total Program Revenue
2017
$ 20,121
44,343
49,221
5,107
8,823
31,293
14,422
173,330
41,475
7,059
48,534
$ 221,864
2018
$ 20,360
43,275
53,271
4,509
7,194
29,521
14,441
172,571
41,683
7,441
49,124
$ 221,695
2019
Page 1 of 4
2020
$ 21,249 $ 25,504
47,948 51,031
46,631 44,862
4,616 4,383
7,683 8,197
33,470 28,683
14,017 14,042
175,614 176,702
39,413
7,752
47,165
$ 222,779
45,055
7,930
52,985
$ 229,687
$ 8,547 $9,518.00 $ 10,414 $ 10,826 $ 12,424
4,276 3,949 3,777 4,413 4,772
320 1,395 253 1,379 113
8,520 8,026 6,566 6,888 6,100
2,218 2,001 2,766 2,328 992
13 3,886 3,503 1,951 460
2,595 - - - 6,609
- 11 - -
11,123 12,459 5,884 8,765 14,164
575 232 239
24,636
62,248
43,677
6,945
30
10,107
51,916
51,544
6,549
19,241
52,647
55,593
7,842
16,678 7,148
53,467 52,782
55,696 54,710
8,621 7,755
1,497 225
4,094 2,027 4,613 4,113 1,456
54,746 60,120 68,048 69,927 64,146
$ 116,994 $ 112,036 $ 120,695 $ 123,394 $ 116,928
154 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN NET POSITION
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
Primary Government 2021
Expenses
Governmental activities:
General government $ 27,596
Public safety 53,503
Public works 48,115
Community services 4,465
Parks and recreation 6,799
Economic development 30,653
Intergovernmental -
Interest on long-term debt 13,604
Total government activities expenses 184,735
Business -type activities:
Water and Sewer 44,654
Solid Waste 8,094
Total Business -type activities 52,748
Total Expenses $ 237,483
Program Revenue
Governmental activities:
Charges for services:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Operating grants and contributions:
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Capital grants and contributions:
Public works
Total governmental activities
Business -type activities:
Charges for services:
Water and sewer
Solid waste
Operating grants and contributions:
Water and sewer
Capital grants and contributions:
Water and sewer
Total Business -type activities
Total Program Revenue
$ 15,425
5,048
157
6,090
1,090
445
1,693
17,584
729
1,876
50,137
52,649
8,064
2022
$ 34,580
52,440
33,363
4,834
8,041
39,101
13,238
185,597
48,592
7,158
55,750
$ 241,347
$ 17,816
5,746
186
5,732
1,614
5,740
14,008
368
51,210
55,352
6,855
35
2023
$ 15,525
69,571
51,591
5,577
10,145
41,692
8,171
13,763
216,035
56,013
7,556
63,569
$ 279,604
$ 11,808
7,743
289
4,067
2,106
1,375
11,564
4,110
12
43,074
68,700
7,473
2024
$ 27,355
73,557
56,711
5,234
11,800
19,773
4,097
13,129
211,656
65,977
8,187
74,164
$ 285,820
$ 15,534
9,546
344
4,126
1,785
1,680
697
649
15
34,376
75,429
8,241
Page 2 of 4
2025
$ 28,273
82,611
59,751
5,937
14,020
18,864
4,043
15,068
228,567
77,067
8,528
85,595
$ 314,162
$ 15,272
11,079
327
5,219
2,196
(248)
891
2,191
9
36,936
82,266
8,464
1,007 - - -
61,720 62,242 76,173 83,670 90,730
$ 111,857 $ 113,452 $ 119,247 $ 118,046 $ 127,666
155 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN NET POSITION
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
Page 3 of 4
2016 2017 2018 2019 2020
Net (Expense)/Revenue
Governmental activities $ (96,957) $ (121,414) $ (119,924) $ (122,147) $ (123,920)
Business -type activities 9,972 11,586 18,924 22,762 11,161
Total Primary Government Net Expense $ (86,985) $ (109,828) $ (101,000) $ (99,385) $ (112,759)
General Revenues and Other
Changes in Net Position
Governmental Activities:
Taxes:
Property taxes
Sales and use taxes
Franchise taxes
Investment earnings
Miscellaneous
Gain on sale of assets
Transfers
Total Governmental Activities
Business -Type Activities:
Sales and use taxes
Investment earnings
Miscellaneous
Transfers
Total Business -Type Activities
Total Primary Government
Change in Net Position:
Governmental activities
Business -type activities
Total Primary Government
$ 67,644 $ 76,686 $ 83,803 $ 89,930 $ 97,106
31,293 31,976 35,437 34,872 34,928
7,228 7,263 7,358 7,480 7,270
729 622 1,651 3,293 1,626
5,957 3,108 4,691 562 4,865
6,464 2,417 3,103 11,364 5,460
119,315 122,072 136,043 147,501 151,255
294 396 1,361 2,947 1,277
166 66 7 2,361 13
(6,464) (2,417) (3,103) (11,364) (5,460)
(6,004) (1,955) (1,735) (6,056) (4,170)
$ 113,311 $ 120,117 $ 134,308 $ 141,445 $ 147,085
$ 22,358 $ 658 $ 16,119 $ 25,354 $ 27,335
3,968 9,631 17,189 16,706 6,991
$ 26,326 $ 10,289 $ 33,308 $ 42,060 $ 34,326
156 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN NET POSITION
Last Ten Fiscal Years
Amounts in (000's)
(Accrual Basis of Accounting)
Page 4 of 4
2021 2022 2023 2024 2025
Net (Expense)/Revenue
Governmental activities $ (134,598) $ (134,387) $ (172,961) $ (177,280) $ (191,630)
Business -type activities 8,972 6,492 12,604 9,506 5,136
Total Primary Government Net Expense $ (125,626) $ (127,895) $ (160,357) $ (167,774) $ (186,494)
General Revenues and Other
Changes in Net Position
Governmental Activities:
Taxes:
Property taxes
Sales and use taxes
Franchise taxes
Investment earnings
Miscellaneous
Gain on sale of assets
Transfers
Total Governmental Activities
Business -Type Activities:
Sales and use taxes
Investment earnings
Miscellaneous
Transfers
Total Business -Type Activities
Total Primary Government
Change in Net Position:
Governmental activities
Business -type activities
Total Primary Government
$ 100,075 $ 101,524 $ 105,407 $ 124,388 $ 125,324
40,248 44,699 47,418 48,235 49,905
6,940 6,870 7,383 7,217 7,502
209 472 8,577 12,868 12,766
4,793 5,206 16,393 2,371 2,709
- - 60 26 776
5,548 6,079 7,142 4,760 7,554
157,813 164,850 192,380 199,865 206,536
- - 4 4 4
94 1,161 6,788 7,328 8,276
16 45 348 124 490
(5,548) (6,079) (7,142) (4,760) (7,554)
(5,438) (4,873) (2) 2,696 1,216
$ 152,375 $ 159,977 $ 192,378 $ 202,561 $ 207,752
$ 23,215 $ 30,463 $ 19,419 $ 22,585 $ 14,906
3,534 1,619 12,602 12,202 6,352
$ 26,749 $ 32,082 $ 32,021 $ 34,787 $ 21,258
157 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
General fund
Non -spendable
Assigned
Unassigned
Total General Fund
Page 1 of 2
2016 2017 2018 2019 2020
$ 151 $ 101 $ 136 $ 15 $ 28
3,994 3,000 1,538 1,521 648
16,774 11,262 12,314 15,666 28,400
$ 20,919 $ 14,363 $ 13,988 $ 17,202 $ 29,076
All Other Governmental Funds
Non -spendable $ $ 4 $ $ $
Restricted 94,411 107,916 101,810 100,773 131,286
Committed
Assigned
Unassigned (28) (52) (28) (27)
Total All Other Governmental Funds $ 94,411 $ 107,892 $ 101,758 $ 100,745 $ 131,259
158 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
General fund
Non -spendable
Assigned
Unassigned
Total General Fund
Page 2 of 2
2021 2022 2023 2024 2025
$ 3 $ - $ 7 $ 67 $ 43
216 - - -
32,305 34,658 31,316 34,957 36,583
$ 32,524 $ 34,658 $ 31,323 $ 35,024 $ 36,626
All Other Governmental Funds
Non -spendable $ - $ $ 11 $ 44 $ 13
Restricted 135,755 152,809 107,122 193,310 192,136
Committed - 9,279 6,383 4,279
Assigned - 974 1,716 1,257
Unassigned (4,796) (3,389) (2,553) (6,293) (8,060)
Total All Other Governmental Funds $ 130,959 $ 149,420 $ 114,833 $ 195,160 $ 189,625
159 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
Page 1 of 2
2016 2017 2018 2019 2020
Revenues
Property taxes $ 67,569 $ 76,562 $ 83,484 $ 90,252 $ 97,106
Sales and use taxes 31,293 31,976 35,437 34,872 34,928
Franchise fees 7,228 7,263 7,358 7,480 7,270
Licenses and permits 5,677 5,435 4,146 4,198 4,424
Fines and forfeitures 2,931 2,654 2,468 2,712 1,723
Charges for services 15,313 16,015 16,769 17,726 18,714
Investment earnings 728 619 1,600 3,186 1,583
Intergovernmental 15,959 16,010 8,579 10,329 19,480
Other 5,065 5,736 7,200 3,947 2,553
Total Revenues 151,763 162,270 167,041 174,702 187,781
Expenditures
General government 11,609 11,223 11,300 11,173 12,513
Public safety 36,818 40,858 41,273 42,716 47,218
Public works 13,292 17,365 16,968 12,596 11,693
Community services 4,294 4,837 4,313 4,219 4,452
Parks and recreation 6,458 6,419 5,959 6,065 5,483
Economic development 31,051 29,001 29,195 38,288 25,843
Debt service:
Principal 19,736 24,341 23,547 38,007 27,796
Interest and other charges 15,841 15,221 15,814 15,646 15,939
Bond issuance costs - - - -
Capital outlay 31,982 43,860 43,474 39,541 38,359
Intergovernmental 4,847 6,937 7,168 7,325 7,769
Total Expenditures 175,928 200,062 199,011 215,576 197,065
Excess of Revenues Over
(Under) Expenditures (24,165) (37,792) (31,970) (40,874) (9,284)
Other Financing Sources (Uses)
Transfers in 26,062 28,466 24,456 34,200 31,561
Transfers out (20,844) (26,860) (22,266) (22,866) (26,101)
Bonds issued 142,701 115,718 24,223 44,292 44,798
Payment to Escrow Agent (89,638) (72,608) (12,551) -
Issuance of debt - financing arrangement 1,918 - - -
Other - - - -
Total Other Financing Sources (Uses) 60,199 44,716 26,413 43,075 50,258
Net Change in Fund Balances $ 36,034 $ 6,924 $ (5,557) $ 2,201 $ 40,974
Debt Service as a Percentage of
Noncapital Expenditures 24.8% 25.3% 24.9% 30.3% 27.6%
160 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
Revenues
Property taxes
Sales and use taxes
Franchise fees
Licenses and permits
Fines and forfeitures
Charges for services
Investment earnings
Intergovernmental
Other
Total Revenues
Expenditures
General government
Public safety
Public works
Community services
Parks and recreation
Economic development
Debt service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Bonds issued
Payment to Escrow Agent
Issuance of debt - financing arrangement
Other
Total Other Financing Sources (Uses)
Page 2 of 2
2021 2022 2023 2024 2025
$ 100,528 $ 101,524 $ 105,169 $ 123,885 $ 125,608
40,248 44,699 47,418 48,235 49,905
6,940 6,870 7,383 7,217 7,502
4,258 4,613 3,622 3,959 4,827
1,868 2,112 1,870 2,215 2,393
19,858 23,301 20,521 25,161 26,873
208 1,006 7,804 11,886 12,027
19,880 19,982 9,836 1,361 8,249
3,207 5,201 15,691 2,304 2,318
196,995 209,308 219,314 226,222 239,703
19,460 15,957 9,359 13,514 14,035
52,191 59,493 64,526 69,872 77,365
12,483 13,957 12,962 15,306 15,516
4,249 4,764 4,938 4,974 5,427
6,102 6,704 8,749 9,502 11,026
29,175 27,346 41,166 19,733 18,755
29,577 30,180 28,404 46,001 51,402
17,357 17,283 17,660 17,267 17,920
- - 10,285 1,768 1,515
77,114 57,619 57,848 34,872 59,506
7,116 7,289 8,171 3,996 4,043
254,824 240,592 264,068 236,807 276,509
(57,829) (31,284) (44,754) (10,585) (36,806)
33,261 35,586 47,258 53,621 66,568
(27,713) (29,507) (46,017) (55,891) (63,367)
46,562 44,674 18,155 91,117 54,258
- - (4,376) - (25,142)
- - 106 1,486 -
7,174 1,155 2 26 556
59,284 51,908 15,128 90,359 32,873
Net Change in Fund Balances $ 1,455 $ 20,624 $ (29,626) $ 79,774 $ (3,933)
Debt Service as a Percentage of
Noncapital Expenditures 26.4%
25.9% 22.3%
31.2% 31.9%
161 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SPENDING AND GROWTH ANAYLSIS — GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
Amounts in (000's)
Expenditures
General government
Public Safety
Public Works
Community Services
Parks & recreation
Economic Development
Debt service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total
Distribution of Spending
General government
Public Safety
Public Works
Community Services
Parks & recreation
Economic Development
Debt service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total
Adjusted for CPI
POPULATION
PER CAPITA
2016
$ 11,609
36,818
13,292
4,294
6,458
31,051
19,736
15,841
31,982
4,847
$ 175,928
2017
$ 11,223
40,858
17,365
4,837
6,419
29,001
24,341
15,221
43,860
6,937
$ 200,062
4.2% 4.1%
49.7% 42.4%
4.8% 6.3%
1.6% 1.7%
2.3% 2.3%
11.2% 10.5%
7.1% 8.8%
5.7% 5.5%
0.0% 0.0%
11.6% 15.9%
1.8% 2.5%
100.0% 100.0%
117,100 121,500
2018
$ 11,363
41,281
16,998
4,313
5,960
29,195
23,547
15,814
44,321
7,168
$ 199,960
4.1%
42.6%
6.1%
1.6%
2.2%
10.6%
8.5%
5.7%
0.0%
16.0%
2.6%
100.0%
2019
$ 11,173
42,716
12,596
4,219
6,065
38,288
38,007
15,646
39,541
7,325
$ 215,576
4.0%
37.6%
4.6%
1.5%
2.2%
13.8%
13.7%
5.7%
0.0%
14.3%
2.6%
100.0%
125,198 127,500
2020
$ 12,513
47,218
11,693
4,452
5,483
25,843
27,796
15,939
38,359
7,769
$ 197,065
4.5%
45.8%
4.2%
1.6%
2.0%
9.3%
10.1%
5.8%
0.0%
13.9%
2.8%
100.0%
Page 1 of 2
2021
$ 19,460
52,191
12,483
4,249
6,102
29,175
29,577
17,357
77,114
7,116
$ 254,824
7.0%
26.7%
4.5%
1.5%
2.2%
10.6%
10.7%
6.3%
0.0%
27.9%
2.6%
100.0%
131,448 125,828
$ 1,502 $ 1,647 $ 1,590 $ 1,691 $ 1,499 $ 2,025
162 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
SPENDING AND GROWTH ANAYLSIS — GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Amounts in (000's)
(Modified Accrual Basis of Accounting)
Amounts in (000's)
Expenditures
General government
Public Safety
Public Works
Community Services
Parks & recreation
Economic Development
Debt service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total
Distribution of Spending
General government
Public Safety
Public Works
Community Services
Parks & recreation
Economic Development
Debt service:
Principal
Interest and other charges
Bond issuance costs
Capital outlay
Intergovernmental
Total
Adjusted for CPI
POPULATION
PER CAPITA
2022
$ 15,957 $
59,493
13,957
4,764
6,704
27,346
30,180
17,283
57,619
7,289
$ 240,592
2023 2024 2025
9,359 $ 13,514 $ 14,035
64,526 69,872 77,365
12,962 15,306 15,516
4,938 4,974 5,427
8,749 9,502 11,026
41,166 19,733 18,755
28,404
17,660
10,285
57,848
8,171
$ 264,068
46,001 51,402
17,267 17,920
1,768 1,515
34,872 59,506
3,996 4,043
$ 236,807 $ 276,509
5.8% 3.4% 4.9% 5.1%
34.6% 27.7% 39.9% 27.9%
5.0% 4.7% 5.5% 5.6%
1.7% 1.8% 1.8% 2.0%
2.4% 3.2% 3.4% 4.0%
9.9% 14.9% 7.1% 6.8%
10.9% 10.3% 16.6% 18.6%
6.3% 6.4% 6.2% 6.5%
0.0% 3.7% 0.6% 0.5%
20.8% 20.9% 12.6% 21.5%
2.6% 3.0% 1.4% 1.5%
100.0% 100.0% 100.0% 100.0%
129,600 124,478
125,983 127,514
$ 1,856 $ 2,121 $ 1,880 $ 2,168
Ten
Year
% CHG
20.9%
110.1%
16.7%
26.4%
70.7%
- 39.6%
160.4%
13.1%
0.0%
86.1%
- 16.6%
57.2%
Page 2 of 2
Average
Compounded
Growth Rate
1.92%
7.71%
1.56%
2.37%
5.50%
- 4.92%
10.05%
1.24%
0.00%
6.41%
- 1.80%
4.63%
Growth Rate
0.86%
3.74%
163 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
ASSESSED VALUE AND ESTIMATED ACTUAL VALUE
OF TAXABLE PROPERTY
Last Ten Fiscal Years
Fiscal Tax
Year Year
2016 2015 $
2017 2016
2018 2017
2019 2018
2020 2019
2021 2020
2022 2021
2023 2022
2024 2023
2025 2024
Residential
6,687,172,478
7,800,700,555
8,160, 296,748
8,388,984,355
8,795,872,742
10, 759, 083, 987
11,111, 640, 283
12,134,105,105
13,967,352,279
14,829,152,032
Commercial
$ 2,200,841,575
2,552,439,217
3,201,012,344
3,467,102, 770
3,632,391,578
1,941,047,529
1,901, 930,199
5,006,577,583
6,048,655,510
4,401,381,757
Personal
Property
$ 677,182,023
776,125,452
801,094,174
880,377,068
1,018,446,748
865,343,567
797,254,587
847,748,246
987,793,152
1,349,995,582
Less Tax Exempt
Property
$ (677,182,023)
(835,697,201)
(916,937,992)
(882,979,174)
(903,424,894)
(974,936,904)
(1,020, 672,002)
(2,996,311,916)
(4,110,179,073)
(1,430,319,689)
Page 1 of 2
164 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
ASSESSED VALUE AND ESTIMATED ACTUAL VALUE
OF TAXABLE PROPERTY
Last Ten Fiscal Years
Fiscal Tax
Year Year
2016 2015
2017 2016
2018 2017
2019 2018
2020 2019
2021 2020
2022 2021
2023 2022
2024 2023
2025 2024
Less Other
Exemptions and
Abatements
$ (423,238,764)
(571,315,443)
(681,810,199)
(904,072,816)
(1,004, 810,809)
(813,268,531)
(908,022,173)
(1,481,214,007)
(1,684,131,352)
(2,179,576,253)
Total Taxable
Assessed Value
$ 8,464,775,289
9,722,252,580
10,563,655,075
10,949,412,203
11,538,475,365
11,777,269,648
11,882,130,894
13, 510, 905, 011
15, 209,490, 516
16,970,633,429
Total Direct Tax
Rate
$ 0.705300
0.681200
0.685059
0.709158
0.741000
0.720000
0.701000
0.624000
0.655400
0.655400
Estimated Actual
Taxable Value
$ 8,464,775,289
9,722,252,580
10,563,655,075
10, 949,412, 203
11,538,475,365
11, 777, 269, 648
11,882,130,894
13, 510, 905, 011
15, 209,490, 516
16,970,633,429
Page 2 of 2
Assessed Value
as a Percent of
Actual Taxable
Value
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
165 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DIRECT AND OVERLAPPING PROPERTY TAX RATES
Last Ten Fiscal Years
(rate per $100 of assessed value)
Page 1 of 3
City of Pearland Overlapping Rates (a)
Pearland Pasadena Alvin
Independent Independent Independent Alvin
Fiscal M & 0 I & S Total School School School Comm Brazoria
Year Rate Rate Direct District District District College County
2016 $ 0.2225 $ 0.4828 $ 0.7053 $ 1.4160 $ 1.3500 $ 1.4170 $ 0.2040 $ 0.4860
2017 0.2412 0.4400 0.6812 1.4160 1.3500 1.4500 0.1920 0.4574
2018 0.2551 0.4300 0.6851 1.4156 1.4800 1.4500 0.1808 0.4402
2019 0.2792 0.4300 0.7092 1.4156 1.4160 1.4500 0.1878 0.3679
2020 0.3070 0.4340 0.7410 1.3960 1.3780 1.3980 0.1860 0.3650
2021 0.3050 0.4150 0.7200 1.3190 1.3830 1.3980 0.1830 0.3920
2022 0.3090 0.3920 0.7010 1.3150 1.3160 1.3980 0.1830 0.3865
2023 0.2850 0.3390 0.6240 1.3080 1.3350 1.3780 0.1640 0.3911
2024 0.3325 0.3229 0.6554 1.1373 1.1382 1.1923 0.1513 0.2707
2025 0.3350 0.3000 0.6350 1.1350 1.1722 1.1700 0.1560 0.2616
Source: Brazoria County, Harris County, and Fort Bend County Appraisal Districts.
lal Overlapping rates are those of local and county governments that apply to property owners
within the City of Pearland. Not all overlapping rates apply to all Pearland property owners.
For example, the county property tax rates apply to all.
166 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DIRECT AND OVERLAPPING PROPERTY TAX RATES
Last Ten Fiscal Years
(rate per $100 of assessed value)
Overlapping Rates (a)
Harris Harris Harris Brazoria/
Fort Port of County County County Ft Bend
Fiscal Bend Harris Houston Flood Hospital Dept of MUD MUD
Year County County Authority Control District Education No. 1 No. 17
2017 $ 0.4860 $ 0.4190 $ 0.0130 $ 0.0270 $ 0.1700 $ 0.0050 $ 0.8480 $ 0.4600
2018 0.4740 0.4166 0.0133 0.0283 0.1718 0.0052 0.8480 0.4100
2019 0.4580 0.4180 0.0126 0.0283 0.1711 0.0052 0.8480 0.3800
2020 0.4450 0.4186 0.0116 0.0288 0.1711 0.0052 0.8480 0.3800
2021 0.4450 0.4070 0.0110 0.0280 0.1660 0.0050 0.8480 0.3600
2022 0.4359 0.3910 0.0100 0.0310 0.1670 0.0050 0.8480 0.3400
2023 0.4568 0.3770 0.0090 0.0340 0.1620 0.0050 0.8480 0.3300
2024 0.4568 0.3440 0.0080 0.0310 0.1480 0.0050 0.8480 0.3000
2024 0.4120 0.3501 0.0057 0.0311 0.1434 0.0048 0.4300 0.2400
2025 0.4220 0.3853 0.0062 0.0490 0.1635 0.0048 0.0420 0.2000
Source: Brazoria County, Harris County, and Fort Bend County Appraisal Districts.
lal Overlapping rates are those of local and county governments that apply to property owners
within the City of Pearland. Not all overlapping rates apply to all Pearland property owners.
For example, the county property tax rates apply to all.
Page 2 of 3
167 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DIRECT AND OVERLAPPING PROPERTY TAX RATES
Last Ten Fiscal Years
(rate per $100 of assessed value)
Overlapping Rates (a)
Fiscal MUD MUD MUD MUD MUD MUD MUD
Year No. 18 No. 19 No. 23 No. 26 No. 28 No. 34 No. 35
2017 $ 0.3900 $ 0.4500 $ 0.5400 $ 0.6900 $ 0.8200 $ 0.8200 $ 1.0200
2018 0.3500 0.4000 0.4800 0.6900 0.8200 0.8000 1.0200
2019 0.3100 0.3800 0.4700 0.6900 0.8200 0.8000 1.0000
2020 0.3100 0.3600 0.4600 0.6900 0.8200 0.7800 1.0000
2021 0.2900 0.3500 0.4600 0.6900 0.8200 0.7500 1.0000
2022 0.2700 0.3100 0.4600 0.5300 0.8200 0.7300 1.0000
2023 0.2500 0.2900 0.4400 0.1000 0.8200 0.6900 1.0000
2024 0.2250 0.2700 0.4400 0.0900 0.7600 0.6200 1.0000
2024 0.2000 0.2200 0.4000 0.0850 0.5800 0.5500 0.9600
2025 0.1900 0.2000 0.3900 0.0800 0.5600 0.5200 0.8600
Source: Brazoria County, Harris County, and Fort Bend County Appraisal Districts.
lal Overlapping rates are those of local and county governments that apply to property owners
within the City of Pearland. Not all overlapping rates apply to all Pearland property owners.
For example, the county property tax rates apply to all.
Page 3 of 3
168 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years
Taxes Levied
Fiscal for the
Year Fiscal Year
2016 $ 58,829,331
2017 64,977,413
2018 70,633,922
2019 75,680,458
2020 83,055,340
2021 86,120,247
2022 87,070,808
2023 87,756,604
2024 105,875,951
2025 108,011,639
Amount
$ 58,545,664
64,579,894
70, 216, 601
75, 276, 247
82, 617,167
85,751,572
86, 638,471
87, 297, 753
105,073,320
107,410,913
Source: Brazoria County Tax Office
Collected within the
Fiscal Year of the Levy
Percentage
of Levy
Note: Taxes levied based on adjusted tax roll.
Collections
in Subsequent
Years
Total Collections to Date
Percentage
Amount of Levy
99.52% $ 236,639 $ 58,782,303
99.39% 336,391 64,916,285
99.41% 351,220 70,567,821
99.47% 327,237 75,603,484
99.47% 351,023 82,968,190
99.57% 272,148 86,023,720
99.50% 319,804 86,958,275
99.48% 304,509 87,602,262
99.24% 553,617 105,626,937
99.44% 107,410,913
99.9%
99.9%
99.9%
99.9%
99.9%
99.9%
99.9%
99.8%
99.8%
99.4%
169 City of Pearland, Texas 2025 ACFR
170 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
PRINCIPAL PROPERTY TAXPAYERS
Current Year and Nine Years Ago
Taxpayer
Pearland Town Center, LP
Shadow Creek Retail Associates, LLC
HCA Healthcare Corp
Longbow Bess
Shadow Creek Owner LP
Centerpoint Energy, Inc.
WRPV XIV SC Pearland LLC
KV Shadow Creek Apartements, LLC
DD SCR VI LLC
Azure Townes LP
Weatherford U.S., Inc.
Amerit SPF Shadow Creek, LP
Mar Shadow Creek LP
MHI Compressor
12400 Shadow Creek Parkway LLC
Discovery Shadow Creek
Shadow Kirby LTD Partnership
Total
2025
Percentage
of Total City
Taxable Taxable
Assessed Assessed
Value Rank Value
$ 120,078,990 1 0.71%
104,072,870 2 0.61%
95,193,430 3 0.56%
86,459,590 4 0.51%
85,795,100 5 0.51%
61,302,262 6 0.36%
58,227,370 7 0.34%
48,904,270 8 0.29%
48,116,990 9 0.28%
48,000,000 10 0.28%
$ 756,150,872
Source: Brazoria County Appraisal District
2016
Percentage
of Total City
Taxable Taxable
Assessed Assessed
Value Rank Value
$ 81,224,456 1 0.96%
69,698,780 2 0.82%
59,511,450 4 0.70%
60,419,650 3 0.71%
54,172,342 5 0.64%
53,984,940 6 0.64%
40,124,109 7 0.47%
35,701,460 8 0.42%
34,401,370 9 0.41%
33,000,000 10 0.39%
4.46% $ 522,238,557 6.17%
171 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
TAXABLE SALES BY CATEGORY
Last Ten Calendar Years
(in thousands of dollars)
Retail Trade
Accommodations & Food Services
Real Estate/Rental/Leasing
Manufacturing
Wholesale Trade
Other Services (Except Public Admin)
Information
Construction
Arts, Entertainment & Recreation
Mining, Quarrying, Oil and Gas
Admin/Support/Waste Mgmt/
Remediation
Professional/Scientific/Technical
Health Care/Social Assistance
Finance, Insurance
Agriculture, Forestry, Fishing
Transportation/Warehousing
Educational Services
Utilities
Total
City direct sales tax rate a
2016
$ 999,033
298,860
32,786
40,192
48,114
40,181
33,449
24,655
16,020
8,141
12,725
12,177
2,307
2,182
2,112
372
406
$ 1,573,712
1.00%
2017
$ 1,042,624
316,070
44,540
39,860
49,702
41,711
35,824
21,363
16,344
11,682
14,489
6,689
3,751
2,108
3,471
560
439
$ 1,651,227
1.00%
Calendar Year
2018
$ 1,056,690
341,462
44,467
39,133
56,347
43,812
39,187
27,310
17,127
11,125
16,918
8,371
3,355
1,906
2,496
678
512
$ 1,710,896
1.00%
2019
$ 1,030,791
375,329
32,215
58,202
42,928
34,340
33,948
3,794
30,721
43,987
763
5,103
$ 1,692,121
1.00%
Page 1 of 2
2020
$ 1,056,636
343,407
39,671
20,889
47,894
41,106
22,832
31,595
15,182
2,287
17,681
8,852
4,386
1,853
2,049
538
390
5
$ 1,657,253
Source: Source: State Comptroller's Office: https://mycpa.cpa.state.tx.us/allocation/HistSales
a The City direct sales tax rate includes the City only and excludes the Pearland Economic Development Corp.
1.00%
172 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
TAXABLE SALES BY CATEGORY
Last Ten Calendar Years
(in thousands of dollars)
Retail Trade
Accommodations & Food Services
Real Estate/Rental/Leasing
Manufacturing
Wholesale Trade
Other Services (Except Public Admin)
Information
Construction
Arts, Entertainment & Recreation
Mining, Quarrying, Oil and Gas
Admin/Support/Waste Mgmt/
Remediation
Professional/Scientific/Technical
Health Care/Social Assistance
Finance, Insurance
Agriculture, Forestry, Fishing
Transportation/Warehousing
Educational Services
Utilities
Total
City direct sales tax rate a
2021
$ 1,252,310
435,702
30,393
21,765
61,786
50,165
26,644
36,189
19,263
2,528
2022
$ 1,295,200
473,006
71,531
28,015
63,330
61,008
29,577
41,704
21,370
5,519
Calendar Year
2023
$ 1,290,850
503,718
85,434
25,555
25,493
71,273
28,941
40,043
23,515
8,098
2024
$ 1,272,772
510,049
112,450
25,507
21,042
68,752
27,054
38,395
23,899
2,932
Page 2 of 2
2025
$ 1,277,303
528,864
104,219
25,757
32,975
67,751
68,818
53,084
25,191
4,896
18,258 18,933 18,525 16,572 17,152
11,512 10,593 12,896 12,808 13,904
3,175 4,072 4,472 6,489 7,417
3,094 2,036 1,663 1,705 1,582
3,654 2,737 2,462 2,503 2,395
234 326 344 470 1,159
1,017 1,085 1,295 1,277 1,298
284 511 607 999 1,070
$ 1,977,973 $ 2,130,553 $ 2,145,184 $ 2,145,675 $ 2,234,835
1.00%
1.00% 1.00%
1.00%
Source: Source: State Comptroller's Office: https://mycpa.cpa.state.tx.us/allocation/HistSales
a The City direct sales tax rate includes the City only and excludes the Pearland Economic Development Corp.
1.00%
173 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years
(dollars in thousands, except per capita)
Governmental Activities
General General
General Obligation Obligation Revenue Unamortized
Fiscal Obligation MUD Bonds- Certificates Revenue Bonds- Premiums/ Financed Leases SBITAs
Year Bonds #16 Private of Obligation Bonds Private (Discounts) Purchases Payable Payable
2016 $ 262,865 $ - $ $ 50,070 $ 91,370 $ $ 18,793 $ 4,229 $ - $ -
2017 283,140 - 37,505 97,215 25,832 1,838
2018 278,175 - - 41,750 98,025 - 23,844 1,282 - -
2019 269,520 - 51,620 85,065 26,639 761
2020 268,680 - - 66,405 81,445 - 29,963 541 - -
2021 260,840 - 86,220 73,235 38,710 381 -
2022 265,615 - - 101,660 64,810 - 36,213 131 42 -
2023 246,090 4,420 89,950 56,160 12,185 29,644 - 109 6,370
2024 267,925 - 3,600 120,000 47,285 10,335 27,559 1,218 149 4,495
2025 255,840 10,565 2,750 121,255 38,175 8,415 23,109 936 - 3,905
Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
Page 1 of 2
174 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years
(dollars in thousands, except per capita)
Fiscal Revenue
Year Bonds
2016 $ 173,570
2017 196,200
2018 214,705
2019 232,415
2020 335,435
2021 400,840
2022 382,785
2023 363,085
2024 344,190
2025 325,025
Certificates
of Obligation
$
Business -Type Activities
45,710
45,710
176,565
289,350
Permanent
Improvement
Bonds
$ 9,775
7,360
4,845
4,480
4,110
3,020
2,710
2,380
1,245
Unamortized
Premiums/
(Discounts)
$ 850
9,395
10,897
16,808
16,168
16,917
18,575
16,073
17,668
19,039
Financed
Purchases
$ 375
257
173
86
Total
Primary
Government
$ 611,897
658,742
673,696
687,394
802,747
880,163
918,251
872,176
1,024,258
1,098,364
Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
175
Percentage
of Personal
Income
13.2%
15.3%
13.1%
12.9%
13.3%
14.6%
15.9%
14.9%
16.3%
16.8%
Total
Per
Capita
$ 5,225
5,422
5,381
5,391
6,107
6,791
7,085
7,007
8,130
8,614
Page 2 of 2
City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
RATIO OF NET GENERAL BONDED DEBT TO ASSESSED
VALUE AND NET BONDED DEBT PER CAPITA
Last Ten Fiscal Years
(dollars in thousands, except per capita)
Fiscal Tax
Year Year
2016 2015
2017 2016
2018 2017
2019 2018
2020 2019
2021 2020
2022 2021
2023 2022
2024 2023
2025 2024
Less Debt Net
General Bonded Service Bonded
Debt a Funds Debt
312,935 (5,034) 307,901
320,645 (8,276) 312,369
319,925 (5,911) 314,014
321,140 (6,797) 314,343
335,085 (5,427) 329,658
347,060 (5,427) 341,633
367,275 (3,436) 363,839
340,460 (3,370) 337,090
391,525 (5,687) 385,838
379,845 (4,239) 375,606
Ratio of Net
Bonded Debt to
Assessed Value
3.6%
3.2%
3.0%
2.9%
2.9%
2.9%
3.1%
2.5%
2.5%
2.2%
Percentage of
Personal
Income b
6.6%
7.3%
6.1%
5.9%
5.5%
5.7%
6.3%
5.8%
6.1%
5.8%
Per
Capita b
2,629
2,571
2,508
2,465
2,508
2,636
2,807
2,708
3,063
2,946
Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
a Includes general obligation bonds, certificates of obligation.
b Population and personal income data can be found in demographic and economic statistics table.
176 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
September 30, 2025 and 2024
Taxing Jurisdiction
Alvin Community College District
Alvin Independent School District
Brazoria County
Brazoria County MUD No. 6
Brazoria County MUD No. 17
Brazoria County MUD No. 18
Brazoria County MUD No. 19
Brazoria County MUD No. 21
Brazoria County MUD No. 22
Brazoria County MUD No. 23
Brazoria County MUD No. 28
Brazoria County MUD No. 34
Brazoria County MUD No. 35
Brazoria-Fort Bend Counties MUD No. 1
Clear Creek Independent School District
Fort Bend County
Fort Bend County Drainage District
Friendswood Independent School District
Harris County (a)
Harris County Dept. of Education
Harris County Flood Control District
Harris County Hospital District
Harris-Brazoria Counties MUD No. 509
Houston Community College District
Houston Independent School District
Lower Kirby Pearland Management District
Pasadena Independent School District
Pearland Independent School District
Port of Houston Authority
San Jacinto Community College District
Total Estimated Overlapping
The City
Total Direct and Estimated Overlapping Debt
Population
Per Capita Debt - Direct and Overlapping Debt
Debt as of
September 30,
2025
$ 17,050,000
1,053,710,000
226,118,313
4,295,000
11,425,000
11, 490, 000
13, 515, 000
23, 440, 000
69, 300, 000
10,035,000
48,865,000
25,460,000
6,085,000
29, 315, 000
1,151,620,000
1,235,264,389
21, 645, 000
180,565,000
2,257,734,736
28,960,000
937,165,000
867,820,000
60,800,000
396,510,000
1,592,875,000
30, 235, 000
865,510,000
355,185,000
406,509,397
505,569,308
Overlapping
Percent Amount
22.19% $
24.83%
21.28%
0.36%
100.00%
100.00%
100.00%
1.67%
1.90%
100.00%
100.00%
100.00%
100.00%
100.00%
0.98%
0.67%
0.67%
0.03%
0.29%
0.29%
0.29%
0.29%
100.00%
0.27%
0.20%
100.00%
2.88%
80.71%
0.29%
1.26%
$ 464,950,626 100.00%
3,783,395
261,636,193
48,117,977
15,462
11,425,000
11,490,000
13,515,000
391,448
1,316,700
10,035,000
48,865,000
25,460,000
6,085,000
29,315,000
11,285,876
8,276,271
145,022
54,170
6,547,431
83,984
2,717,779
2,516,678
60,800,000
1,070,577
3,185,750
30,235,000
24,926,688
286,669,814
1,178,877
6,370,173
917,515,265
464,950,626
$ 1,382,465,891
127,514
$ 10,842
Source: Individual jurisdictions and/or Texas Municipal Reports.
(a) Harris County Toll Road Certificates are considered self-supporting and are not included
in the amount shown for Harris County.
Page 1 of 2
177 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
September 30, 2025 and 2024
Taxing Jurisdiction
Alvin Community College District
Alvin Independent School District
Brazoria County
Brazoria County MUD No. 6
Brazoria County MUD No. 17
Brazoria County MUD No. 18
Brazoria County MUD No. 19
Brazoria County MUD No. 21
Brazoria County MUD No. 22
Brazoria County MUD No. 23
Brazoria County MUD No. 28
Brazoria County MUD No. 34
Brazoria County MUD No. 35
Brazoria-Fort Bend Counties MUD No. 1
Clear Creek Independent School District
Fort Bend County
Fort Bend County Drainage District
Friendswood Independent School District
Harris County (a)
Harris County Dept. of Education
Harris County Flood Control District
Harris County Hospital District
Harris-Brazoria Counties MUD No. 509
Houston Community College District
Houston Independent School District
Lower Kirby Pearland Management District
Pasadena Independent School District
Pearland Independent School District
Port of Houston Authority
San Jacinto Community College District
Total Estimated Overlapping
The City
Total Direct and Estimated Overlapping Debt
Population
Per Capita Debt - Direct and Overlapping Debt
Debt as of
September 30,
2024
$ 19,520,000
918,045,000
202,278,313
4,740,000
13,065,000
13,210,000
15,305,000
20,885,000
58,860,000
11,005,000
51,425,000
27,495,000
6,530,000
32,785,000
1,065,675,000
1,139, 374,190
22,655,000
187,375,000
2,424,019,039
28,960,000
968,445,000
65,285,000
54,105,000
422, 215,000
1,773,440,000
32,060,000
896,800,000
383,840,000
426,134,397
520,862,492
Percent
22.19%
24.83%
21.28%
0.36%
100.00%
100.00%
100.00%
1.67%
1.90%
100.00%
100.00%
100.00%
100.00%
100.00%
0.98%
0.67%
0.67%
0.03%
0.29%
0.29%
0.29%
0.29%
100.00%
0.27%
0.20%
100.00%
2.88%
80.71%
0.29%
1.26%
Overlapping
Amount
$ 4,331,488
227,950,574
43,044,825
17,064
13, 065, 000
13, 210, 000
15,305,000
348,780
1,118, 340
11, 005, 000
51,425,000
27,495,000
6,530,000
32,785,000
10,443,615
7,633,807
151,789
56,213
7,029,655
83,984
2,808,491
189,327
54,105, 000
1,139,981
3,546,880
32,060,000
25,827,840
309,797,264
1,235,790
6,562,867
910,303,574
$ 444,927,257 100.00% 444,927,257
$ 1,355,230,831
125,983
$ 10,757
Source: Individual jurisdictions and/or Texas Municipal Reports.
(a) Harris County Toll Road Certificates are considered self-supporting and are not included
in the amount shown for Harris County.
Page 2 of 2
178 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
PLEDGE REVENUE COVERAGE
Last Ten Fiscal Years
Amounts in (000's)
Water & Sewer Revenue Bonds
Net
Less: Revenue Debt Service Due in One Year
Fiscal Gross Operating Available for
Year Revenues Expenses Debt Service Principal Interest Total Coverage
2016 44,163 21,167 22,996 7,630 4,918 12,548 1.83
2017 52,005 24,178 27,828 9,195 4,297 13,492 2.06
2018 56,960 24,247 32,713 10,630 5,129 15,759 2.08
2019 61,001 22,340 38,661 11,770 6,586 18,356 2.11
2020 56,221 26,128 30,093 15,935 6,867 22,802 1.32
2021 52,681 25,550 27,131 18,055 9,743 27,798 0.98
2022 56,590 26,245 30,345 19,700 7,372 27,072 1.12
2023 75,836 31,664 44,172 18,895 6,975 25,870 1.71
2024 82,873 36,414 46,459 19,165 6,607 25,772 1.80
2025 91,020 41,673 49,347 19,660 6,211 25,871 1.91
Note: Details regarding the City's outstanding debt can be found in the notes to the financial
statements. Operating expenses do not include interest, depreciation, or amortization expenses.
Debt service excludes Permanent Improvement Bonds paid with system revenues, as those bonds
do not require bond coverage.
179 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
DEMOGRAPHIC AND ECONOMIC STATISTICS
Last Ten Fiscal Years
Fiscal Population
Year (A)
2016 117,100
2017 121,500
2018 125,198
2019 127,500
2020 131,448
2021 129,600
2022 129,600
2023 124,478
2024 125,983
2025 127,514
Personal
Income
(in $000's)
$ 4,637,394
4,305,839
5,134,370
5,313,435
6,015,060
6,015,060
5,758,128
5,860,050
6,279,623
6,523,234
Per Capita
Personal
Income Median Age
(B) (A)
$ 39,602 33.9
35,439 36.1
41,010 34.7
41,674 35.3
45,760 36.1
46,413 36.1
44,430 35.3
47,077 36.2
49,845 36.5
51,157 37.1
Education
Level in Years
of Schooling
14.2
14.2
14.2
14.2
14.2
14.2
14.2
14.2
14.2
14.2
School
Enrollment
(C)
24,096
24,400
30,739
37,400
28,568
28,568
28,568
28,867
20,862
20,652
Unemployment
Rate
(D)
3.8%
4.0%
3.5%
2.7%
6.7%
4.1%
3.2%
3.9%
4.2%
3.7%
(A) Source: Pearland Economic Development Corporation, 2024 American Community Survey five-year estimate (DP05).
(B) Source: Pearland Economic Development Corporation, 2024 American Community Survey five-year estimate (DP03).
(C) Source: https://www.pearlandisd.org/about-us/our-district/campus-district-enrollment-report
(D) Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (Laus) Report, 2023
180 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
PRINCIPAL EMPLOYERS
Current Year and Nine Years Ago
Employer
2025 2016
Percentage Percentage
of Total City of Total City
Employees Rank Employment Employees Rank Employment
Pearland ISD
Kelsey Seybold
Lonza
City of Pearland
Alvin ISD
Memorial Hermann
HCA (Pearland Medical Center)
Buc-ee's
Kemlon
Third Coast
Merit medical
Pearland Medical Center
Dover Energy
TurboCare
Total
Sources:
Pearland Economic Development Corp.
2,666 1 3.86% 2,660 1 4.72%
1,684 2 2.44% 873 2 1.55%
950 3 1.38%
913 4 1.32% 781 3 1.39%
753 5 1.09% 450 4 0.80%
540 6 0.78% 370 5 0.66%
400 7 0.58%
320 8 0.46%
304 9 0.44% 300 7 0.53%
300 10 0.43%
330 6 0.59%
300 7 0.53%
205 9 0.36%
180 10 0.32%
8,830 12.78% 6,449 11.46%
Note: Does not include retail employers, such as Wal-Mart, Super Target, Lowe's, Home Depot, HEB.
181 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
FULL-TIME EQUIVALENT CITY GOVERNMENT
EMPLOYEES BY FUNCTION/PROGRAM
Last Ten Fiscal Years
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Function/Program
Governmental Activities:
General Government 62 52 54 55 66 64 98 94 102 102
Public Safety 370 370 379 390 408 424 433 442 440 440
Public Works 54 65 73 85 80 76 60 64 62 62
Community Services 42 50 46 46 48 47 49 49 44 44
Parks and Recreation 89 84 89 90 94 97 98 114 101 101
Business Type Activities:
Water & Sewer 106 109 114 108 117 134 148 147 147 147
Component Unit:
Economic Development 5 5 6 6 6 6 7 7 7 7
CVB/Visit Pearland 4 5
Total 728 735 761 780 819 848 893 917 906 908
Source: City Budget
182 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Page 1 of 6
Function/Program 2016 2017 2018 2019 2020
GENERAL GOVERNMENT
Finance:
Number of purchase orders 2,159 589 1,811 1,673 1,724
Number of invoices paid 26,675 24,548 21,547 17,641 16,482
Average number of employees paid per month 1,536 1,704 1,641 1,665 1,713
Human Resources:
Number of hires 194 170 163 183 161
Number of applications received 10,420 13,010 15,452 17,382 16,610
Legal:
Number of resolutions and ordinances prepared 279 276 290 340 307
Information Technology:
Average monthly service requests 871 894 325 400 347
Number of PC's supported 680 706 715 732 782
PUBLIC SAFETY
Police:
Part 1 Crimes
Traffic Crashes
Arrests
Citizen Calls for Service
Traffic Stops
Priority 1 Average Response Time
Fire:
Total number of arson incidents
Fires investigated
Total annual inspections
Total code violation cases
Total calls for service
Patients treated
Sources: Various city departments.
2,202 2,193 1,962 2,175 1,934
1,728 1,813 2,150 2,150 1,719
5,044 4,865 4,844 4,604 2,613
31,744 31,945 31,579 32,548 30,341
35,764 37,025 33,101 33,559 21,764
4:11 3:40 4:03 3:53 3:59
7 4 2 2 4
27 19 15 23 60
1,244 2,607 3,123 1,263 1,155
2,560 2,302 2,034 2,387 1,577
9,904 9,965 10,666 10,720 10,587
6,117 4,610 6,273 7,181 7,618
183 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Page 2 of 6
Function/Program 2021 2022 2023 2024 2025
GENERAL GOVERNMENT
Finance:
Number of purchase orders 2,090 2,126 1,837 2,516 2,237
Number of invoices paid 17,387 16,424 17,635 19,288 20,005
Average number of employees paid per month 1,800 845 866 879 895
Human Resources:
Number of hires 212 242 259 194 237
Number of applications received 12,226 12,450 11,542 9,519 12,893
Legal:
Number of resolutions and ordinances prepared 310 308 342 326 237
Information Technology:
Average monthly service requests 380 335 297 237 284
Number of PC's supported 810 794 765 780 786
PUBLIC SAFETY
Police:
Part 1 Crimes
Traffic Crashes
Arrests
Citizen Calls for Service
Traffic Stops
Priority 1 Average Response Time
Fire:
Total number of arson incidents
Fires investigated
Total annual inspections
Total code violation cases
Total calls for service
Patients treated
Sources: Various city departments.
1,876 2,325 2,282 1,925 1,719
1,857 1,850 1,942 1,987 1,905
3,018 3,903 3,752 3,793 3,801
31,092 33,842 33,523 32,047 31,113
26,806 30,710 28,766 28,697 35,694
4:00 4:29 4:13 3:53 3:59
9 8 2 3 4
47 54 83 91 47
569 589 623 2,739 2,005
1,866 1,321 798 946 908
12,677 13,114 13,548 11,778 14,197
8,891 7,788 10,398 8,116 10,069
184 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Function/Program (continued)
PUBLIC WORKS
Fleet Maintenance:
Fleet maintenance jobs completed
Preventative maintenance performed
Other Public Works:
Fuel issued (gallons)
Street sweeping (miles)
Street signs maintained/replaced
Total work orders completed
PARKS AND RECREATION
All Parks and recreation:
ROW maintained - acres
Trees maintained
Acres of city property mowed
Total number of park work orders received
Parkland - acres
Total number of special events held
Total number of tournaments held
Number of recreation classes offered (1)
Average monthly attendance (all locations) (2)
Sources: Various city departments.
Page 3 of 6
2016 2017 2018 2019 2020
1,452 1,797 1,382 1,998 1,632
750 742 663 856 645
265,669 331,005 315,941 323,734 351,123
1,160 1,112 1,815 497 564
1,370 1,179 1,471 1,511 4,638
31,163 25,688 24,529 20,791 17,696
459 327 345 404 381
7,922 8,355 8,523 8,873 9,223
632 664 443 523 523
190 114 147 55 19
337 388 392 547 547
16 19 17 23 13
26 - 5 12 18
384 265 868 908 289
19,636 16,814 24,035 19,518 9,661
Information not presented was not available at time of publication.
(11 In FY2020 and FY2021, recreation classes were cancelled due to COVID-19.
(2) In FY2020 and FY2021, attendance was down due to COVID-19.
185 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Function/Program (continued)
PUBLIC WORKS
Fleet Maintenance:
Fleet maintenance jobs completed
Preventative maintenance performed
Other Public Works:
Fuel issued (gallons)
Street sweeping (miles)
Street signs maintained/replaced
Total work orders completed
PARKS AND RECREATION
All Parks and recreation:
ROW maintained - acres
Trees maintained
Acres of city property mowed
Total number of park work orders received
Parkland - acres
Total number of special events held
Total number of tournaments held
Number of recreation classes offered (1)
Average monthly attendance (all locations) (2)
Sources: Various city departments.
Page 4 of 6
2021 2022 2023 2024 2025
1,704 1,699 1,219 1,964 1,589
721 784 340 531 332
277,230 375,002 397,177 399,600 434,262
453 671 663 217 432
662 856 459 657 592
17,431 16,153 5,171 3,702 5,077
299 353 334 334 334
10,873 13,688 14,030 23,570 8,017
561 561 817 817 921
22 51 65 18 85
547 547 547 547 562
11 35 44 43 47
19 9 11 19 22
237 1,735 2,705 2,968 2,423
9,872 33,371 21,416 55,717 43,734
Information not presented was not available at time of publication.
(11 In FY2020 and FY2021, recreation classes were cancelled due to COVID-19.
(2) In FY2020 and FY2021, attendance was down due to COVID-19.
186 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Function/Program (continued)
COMMUNITY SERVICES
Animal Control:
Animal Services Calls for Service
Animal Shelter Live Release %
Inspection Services
Total building inspections
Total permits issued
Number of plans reviewed
Municipal Court:
Number of trials (3)
Number of charges (3)
Warrants cleared (3)
WATER & SEWER
Distribution and Collection:
Fire hydrant maintenance and inspections (4)
Backed up sewer repairs
Water mains repaired
Water Production:
Water produced - wells
(in millions of gallons)
Surface Water Produced
(in millions of gallons)
Surface Water Purchased
(in millions of gallons)
Billing & Collections:
Annual meter reads
Number of bills
Wastewater Treatment:
Wastewater treated
(in millions of gallons)
Sources: Various city departments.
Page 5 of 6
2016 2017 2018 2019 2020
5,484 5,153 4,699 4,582 4,596
54% 56% 56% 55% 80%
37,206 34,880 36,774 36,481 30,781
14,612 13,075 8,894 7,270 5,545
1,349 1,278 1,971 2,419 2,196
443 656 567 664 390
17,611 16,334 15,463 19,020 9,577
7,525 8,463 5,801 6,095 3,757
854 186 114 87 2,358
497 545 308 196 233
120 102 126 125 114
2,190 2,417 3,024 2,333 3,816
2,517 2,584 2,545 2,754 2,975
445,154 461,502 467,910 469,499 469,908
417,312 471,549 445,446 449,933 452,465
3,367 3,455 3,308 3,775 3,577
Information not presented was not available at time of publication.
(3) In FY2020 and FY2021, COVID-19 impacted Municipal Court operations.
(4) Prior to FY2020, fire hydrant maintenance and inspections was contracted out.
187 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Function/Program (continued)
COMMUNITY SERVICES
Animal Control:
Animal Services Calls for Service
Animal Shelter Live Release %
Inspection Services:
Total building inspections
Total permits issued
Number of plans reviewed
Municipal Court:
Number of trials (3)
Number of charges (3)
Warrants cleared (3)
WATER & SEWER
Distribution and Collection:
Fire hydrant maintenance and inspections (4)
Backed up sewer repairs
Water mains repaired
Water Production:
Water produced - wells
(in millions of gallons)
Surface Water Produced
(in millions of gallons)
Surface Water Purchased
(in millions of gallons)
Billing & Collections:
Annual meter reads
Number of bills
Wastewater Treatment:
Wastewater treated
(in millions of gallons)
Sources: Various city departments.
Page 6 of 6
2021 2022 2023 2024 2025
5,237 4,420 2,612 2,419 2,404
94% 93% 94% 95% 94%
29,525 27,919 22,848 15,159 28,474
11,066 10,794 8,365 7,655 8,904
1,926 2,052 1,619 1,546 2,474
233 506 175 95 89
11,351 13,159 11,222 12,842 14,521
3,873 4,866 3,879 4,193 3,881
903 1,412 75 1,851 3,924
178 60 277 66 83
121 252 180 125 234
2,211 2,939 2,809 2,859 1,863
- - 1,869
2,506 2,533 3,002 2,338 1,480
486,717 464,691 491,661 487,558 489,549
460,147 482,741 473,196 487,558 479,376
3,737 3,380 3,785 3,257 3,337
Information not presented was not available at time of publication.
(3) In FY2020 and FY2021, COVID-19 impacted Municipal Court operations.
(4) Prior to FY2020, fire hydrant maintenance and inspections was contracted out.
188 City of Pearland, Texas 2025 ACFR
189 City of Pearland, Texas 2025 ACFR
CITY OF PEARLAND, TEXAS
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Function/Program 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
PUBLIC SAFETY
Police
Police stations 1 1 1 1 1 1 1 1 1 1
Police vehicles 186 194 209 211 210 201 202 203 206 200
Police K9s 4 5 5 5 5 4 4 5 3 3
FARO Laser Scanning System(1) 1 1 1 1 1 1 1 1 1 1
Pole Camera System(1) - - 1 1 3 3 3 2
Animal Services
Animal Services building (shelter) 1 1 1 1 1 1 1 1 1 1
Animal Services vehicles (2) 10 10 11 11 11 11 11 11 11 10
Fire
Fire stations 6 7 6 5 6 6 6 6 6 6
Fire vehicles 42 56 60 61 56 55 41 45 15 15
Ambulances (1) 9 9 10 10 9 9 10 11 11 11
PUBLIC WORKS
Streets (miles) (2) 936 928 940 978 978 971 971 980 980 1003
Vehicle inventory (31 451 385 338 434 502 443 626 653 674 706
Traffic signals 87 91 96 97 100 104 109 115 115 116
PARKS AND RECREATION
Developed acreage (4) 334 388 392 443 458 458 458 547 547 562
Pools 3 3 3 2 2 2 2 2 2 2
Outdoor basketball courts 6 6 6 8 8 8 8 8 8 8
Soccer fields 18 12 14 12 12 11 13 13 13 13
Activity buildings 3 3 3 4 4 4 4 4 4 4
Baseball/softball fields 6 14 16 16 16 16 17 17 17 17
WATER AND SEWER
Water Production
Water wells 10 10 10 10 10 10 10 10 10 10
Pumping stations 3 3 3 3 3 3 2 2 2 2
Ground storage tanks 15 15 15 15 15 16 16 16 16 16
Elevated towers 6 6 6 6 6 6 6 6 6 6
Wastewater
Treatment plants 5 5 5 6 5 5 5 5 5 5
Lift stations 74 72 78 69 69 68 68 68 78 70
Distribution and Collection
Water mains (miles) 537 546 551 553 553 538 545 571 572 574
Sanitary sewers (miles) 440 448 456 459 459 453 455 470 471 472
Sources: Various city departments.
Note: No capital asset indicators are available for the general government and community services functions.
Information not presented was not available at time of publication.
190 City of Pearland, Texas 2025 ACFR
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CITY OF PEARLAND, TEXAS
FEDERAL SINGLE AUDIT REPORT
For the Year Ended September 30, 2025
CITY OF PEARLAND, TEXAS
TABLE OF CONTENTS
Page
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
Independent Auditors' Report on Compliance for each Major Federal Program; Report on
Internal Control over Compliance; and Report on Schedule of Expenditures of Federal
Awards Required by the Uniform Guidance
Schedule of Findings and Questioned Costs
Schedule of Expenditures of Federal Awards
Notes to Schedule of Expenditures of Federal Awards
Summary Schedule of Prior Audit Findings
Corrective Action Plan
1
3
6
7
8
9
10
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 Honorable Mayor and
Members of City Council
City of Pearland, Texas
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, the business -type activities, each major fund, and
the aggregate remaining fund information of City of Pearland, Texas (the "City"), as of and for the year ended September
30, 2025, and the related notes to the financial statements, which collectively comprise the City's basic financial statements
and have issued our report thereon dated March 23, 2026.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control over financial
reporting (internal control) as a basis for designing 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 City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City'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 City'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 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 or significant deficiencies may exist that were not identified.
1 City of Pearland, Texas 2025 FSA
To the Honorable Mayor and
Members of City Council
City of Pearland, Texas
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City'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 City'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 City's internal
control and compliance. Accordingly, this communication is not suitable for any other purposes.
Houston, Texas
March 23, 2026
2 City of Pearland, Texas 2025 FSA
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM;
REPORT ON INTERNAL CONTROL OVER COMPLIANCE; AND REPORT ON
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED
BY THE UNIFORM GUIDANCE
To the Honorable Mayor and
Members of City Council
City of Pearland, Texas
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited City of Pearland, Texas' (the "City") compliance with the types of compliance requirements identified as
subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the City's major
federal programs for the year ended September 30, 2025. The City's major federal programs are identified in the summary
of auditor's results section of the accompanying schedule of findings and questioned costs.
In our opinion, the City complied, in all material respects, with the compliance requirements referred to above that could
have a direct and material effect on each of its major federal programs for the year ended September 30, 2025.
Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of
America (GAAS); the standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States (Government Auditing Standards); and the audit requirements of Title 2 U.S. Code
of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal
Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in
the Auditor's Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with relevant
ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a
legal determination of the City's compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation,
and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules
and provisions of contracts or grant agreements applicable to the City's federal programs.
3 City of Pearland, Texas 2025 FSA
To the Honorable Mayor and
Members of City Council
City of Pearland, Texas
Auditor's Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance
requirements referred to above occurred, whether due to fraud or error, and express an opinion on the City's compliance
based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a
guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance
will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from
fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to
above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the
judgment made by a reasonable user of the report on compliance about the City's compliance with the requirements of
each major federal program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform
audit procedures responsive to those risks. Such procedures include examining, On a test basis, evidence regarding
the City's compliance with the compliance requirements referred to above and performing such other procedures
as we considered necessary in the circumstances.
• Obtain an understanding of the City's internal control over compliance relevant to the audit in order to design audit
procedures that are appropriate in the circumstances and to test and report on internal control over compliance in
accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of
the City's internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we
identified during the audit.
Report on Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not
allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and
correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness
in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance,
such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal
program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over
compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance
requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the Auditor's
Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal
control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance.
Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal
control over compliance may exist that were not identified.
4 City of Pearland, Texas 2025 FSA
To the Honorable Mayor and
Members of City Council
City of Pearland, Texas
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal
control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly,
this report is not suitable for any other purpose.
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and
the aggregate remaining fund information of the City as of and for the year ended September 30, 2025, and the related
notes to the financial statements, which collectively comprise the City's basic financial statements. We issued our report
thereon dated March 23, 2026, which contained unmodified opinions on those financial statements. Our audit was
conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial
statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis
as required by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the
responsibility of management and was derived from and relates directly to the underlying accounting and other records
used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in
the audit of the financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial statements or to the
basic financial statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in
all material respects in relation to the basic financial statements as a whole.
Houston, Texas
March 23, 2026
5 City of Pearland, Texas 2025 FSA
CITY OF PEARLAND, TEXAS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For The Year Ended September 30, 2025
I. Summary of Auditors' Results
Financial Statements
Type of auditors' report issued:
Internal control over financial reporting:
Material weakness (es) identified?
Significant deficiencies identified that are not considered
to be material weaknesses?
Noncompliance material to financial statements noted?
Federal Awards
Internal control over major programs:
Material weakness (es) identified?
Significant deficiencies identified that are not considered
to be material weaknesses?
Type of auditors' report issued on compliance
with major programs:
Any audit findings disclosed that are required to be
reported in accordance with 2 CFR 200.516 (a) ?
Unmodified
No
None reported
No
No
None reported
Unmodified
No
Identification of major programs:
Name of Federal Program or Cluster Assistance Listing Number (ALN)
U.S. Department of Housing and Urban Development
CDBG- Disaster Recovery Grants (CDBG-DR Infrastructure)
CDBG- Hazard Mitigation Grants (CDBG-MITMOD Infrastructure)
14.228
14.228
Dollar Threshold Considered Between Type A and
Type B Federal Programs $1,000,000
Auditee qualified as low risk auditee? Yes
II. Financial Statement Findings
None reported
III. Federal Award Findings and Questioned Costs
None reported
6 City of Pearland, Texas 2025 FSA
CITY OF PEARLAND, TEXAS
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Year Ended September 30, 2025
Federal Grantor/Pass-Through Grantor/Program Title
U.S. Department of Housing and Urban Development
Direct:
CDBG/Entitlement Grants (HUD PY 2019)
CDBG/Entitlement Grants (HUD PY2020 - CoP FY2021)
COVID-19 - CDBG/Entitlement Grants COVID 19 Stimulus (HUD PY 20)
CDBG/Entitlement Grants (HUD PY 2024 - CoP FY 2025)
Total CDBG - Entitlement Grants Cluster (ALN 14.218)
Passed Through Texas General Land Office (GLO):
CDBG- Disaster Recovery Grants (CDBG-DR Infrastructure)
CDBG- Hazard Mitigation Grants (CDBG-MITMOD Infrastructure)
Total CDBG - Non -Entitlement Grants (ALN 14.228)
Total U.S. Department of Housing and Urban Development
U.S. Department of Justice
Direct:
Equitable Sharing Program
Passed -through Texas Office of the Governor - Criminal Justice Division (CJD):
Victims of Crime Act
VOCA Peer Support
Total ALN 16.575
Total U.S. Department of Justice
U.S. Department of Transportation
Passed -through the Texas Department of Transportation:
Highway Planning and Construction - Safe Routes to Schools (TR1602)
Highway Planning and Construction - Smith Ranch Road Expansion (TR1501)
Highway Planning and Construction - Mykawa Road Widening (TR0601)
Total ALN 20.205
DWI STEP COMP Grant
DWI STEP CMV Grant
DWI STEP CIOT
DWI STEP SLOW
Total Highwey Safety Cluster (ALN 20.600)
Total U.S. Department of Transportation
U.S. Department of Treasury
Direct:
COVID-19 - American Rescue Plan Act
Total U.S. Department of Treasury
U.S. Environmental Protection Agency
Passed through Texas Water Development Board:
DWSRF (SWP WA1605)
Total U.S. Environmental Protection Agency
Executive Office of the President
Passed through Drug Enforcement Agency:
High -intensity Drug Trafficking Area
Total Executive Office of the President
U.S. Department of Homeland Security
Passed through Texas Division of Emergency Management:
Hazard Mitigation Grant
Passed through Texas Water Development Board:
Flood Mitigation Assistance
Total U.S. Department of Homeland Security
Pass -Through
Entity Identifying Passed Through Federal
ALN Number to Subrecipients Expenditures
14.218 B -19 -MC -48-0400 $ $ 192,075
14.218 B -20 -MC -48-0399 - 54,667
14.218 B -20 -MW -48-0400 - 28,298
14.218 B -24 -MC -48-0400 36,821 252,596
36,821 527,636
14.228 20-065-106-C288 - 2,194,961
14.228 24-065-017-E174 - 875,603
3,070,564
36,821 3,598,200
16.922 TX0201000 - 175,995
16.575 23623-11 - 135,580
16.575 48360-02 - 65,850
201,430
377,425
20.205 CSJ: 0912-31-318 - 65,789
20.205 CSJ: 0912-31-293 - 4,087,211
20.205 CS1:0912-00-543 - 751,794
4,904,794
20.600 2025-pearlaPD-S-CMV-00048 - 11,986
20.600 2025-pearlaPD-S-1YG-00141 - 11,256
20.600 2025-pearlaPD-CIOT-RFR-00086 - 2,280
20.600 2025-pearlaPD-OpSlow-00048 - 2,440
27,962
4,932,756
21.027 SLT-0851 - 899,161
899,161
66.468 L1000612 - 1,066,378
1,066,378
95.001 G23HN0028A - 8,983
8,983
97.039 DR -4332-283 - 232,638
97.029 1900012532 - 879,736
1,112,374
Total Expenditures of Federal Awards $
36,821 $ 11,995,277
7 City of Pearland, Texas 2025 FSA
CITY OF PEARLAND, TEXAS
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Note 1— Summary of Significant Accounting Policies
The City accounts for awards under federal programs in the general and special revenue governmental funds.
In the governmental funds, these programs are accounted for using a current financial resources measurement focus. With
this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating
statements of these funds present increases (i.e. revenues and other financing sources) and decreases (i.e. expenditures
and other financing uses) in net current assets. The modified accrual basis of accounting is used for these funds. This basis
of accounting recognizes revenues in the accounting period in which they become susceptible to accrual, i.e., both
measurable and available, and expenditures in the accounting period in which the liability is incurred, if measurable, except
for certain compensated absences and claims and judgments, which are recognized when the obligations are expected to
be liquidated with expendable available financial resources. Expenditures are recognized following the cost principles
contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited to
reimbursement. Pass -through entity identifying numbers are presented where available.
Federal grants are considered to be earned to the extent of expenditures made under the provisions of the grant, and,
accordingly, when such funds are received, they are recorded as unearned revenues until earned. Generally, unused
balances are returned to the grantor at the close of specified project periods.
Note 2 - Basis of Presentation
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal grant activity of the
City under programs of the federal government for the year ended September 30, 2025. The information in this schedule is
presented in accordance with the requirements of the Uniform Guidance. Because the schedule presents only a selected
portion of the operations of the City, it is not intended to and does not present the financial position, changes in net
position or cash flows of the City.
Note 3 — Indirect Cost Rate
In accordance with 2 CFR 200.414(f), recipients and subrecipients that do not have a current Federal negotiated indirect
cost rate may elect to charge a de minimis rate of up to 10 percent of modified total direct costs (MTDC). For federal
awards issued on or after October 1, 2024, revisions to the Uniform Guidance increased the allowable de minimis rate to 15
percent. The City did not elect to use the de minimis indirect cost rate of 10 percent or 15 percent.
Note 4 - Outstanding Loans
The City has outstanding loan commitments under the Clean Water State Revolving Loan Fund (ALN #66.458) and Drinking
Water State Revolving Loan Fund (ALN #66.468) from the Texas Water Development Board, as a pass -through agency for
the Environmental Protection Agency. As of September 30, 2025, the outstanding loan payable balances were:
Loan Balance as of
Program Title ALN September 30, 2025
Clean Water State Revolving Funds, Series 2016A 66.458 $ 4,880,000
Clean Water State Revolving Funds, Series 2016C 66.458 34,005,000
TWDB Drinking Water State Revolving Funds, Series 2017A 66.468 2,100,000
TWDB Drinking Water State Revolving Funds, Series 2017B 66.468 9,285,000
TWDB Drinking Water State Revolving Funds, Series 2018A 66.468 6,630,000
TWDB Drinking Water State Revolving Funds, Series 2019A 66.468 16,800,000
TWDB Drinking Water State Revolving Funds, Series 2020A 66.468 89,660,000
TWDB Drinking Water State Revolving Funds, Series 2021A 66.468 65,685,000
$ 229,045,000
8 City of Pearland, Texas 2025 FSA
CITY OF PEARLAND, TEXAS
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
For the Year Ended September 30, 2025
Federal regulations, Title 2 U.S. Code of Federal Regulations Section 200.511 states, "The auditee is responsible for follow-
up and corrective action on all audit findings. As part of this responsibility, the auditee must prepare a summary schedule of
prior audit findings." The summary schedule of prior audit findings must report the status of the following:
• All audit findings included in the prior audit's schedule of findings and questioned costs and
• All audit findings reported in the prior audit's summary schedule of prior audit findings except audit findings listed as
corrected.
I. Prior Audit Findings
N/A
9 City of Pearland, Texas 2025 FSA
CITY OF PEARLAND, TEXAS
CORRECTIVE ACTION PLAN
For the Year Ended September 30, 2025
Federal regulations, Title 2 U.S. Code of Federal Regulations §200.511 states, "At the completion of the audit, the auditee
must prepare a corrective action plan to address each audit finding included in the auditor's report for the current year. The
corrective action plan must be a document separate from the auditor's findings described in § 200.516."
I. Corrective Action Plan
N/A
10 City of Pearland, Texas 2025 FSA